Bitstamp is a digital currency exchange platform that has been in operation since its inception in 2011. Its founders, Nejc Kodric and Damijan Merlak, created Bitstamp in a bid to create a customized European exchange platform that would extend its services to European users. At the time, Mt. Gox was the only existing Bitcoin exchange platform. However, it was based in Japan and, therefore, wiring funds to Mt. Gox took several days and often resulted in a capital loss due to Bitcoin’s volatile nature. The two founders thus created it as an easier alternative to Mt. Gox for European users. In 2014, Mt. Gox collapsed leaving Bitstamp as the only convenient digital currency exchange. It has gained popularity among its users since then.
Having been in operation since August 2011, Bitstamp is accorded as one of the oldest, most respected and reliable digital currency exchange in the industry. It was originally founded in Slovenia, but later its registration was moved to the United Kingdom in April 2013. It later moved to Luxembourg in 2016. It is currently the best exchange platform for intermediate or expert traders. It is especially convenient for traders who wish to trade in large amounts of digital currency as it offers low fees to exchange them.
Is Bitstamp a Scam? Is it Safe?
As suggested earlier, Bitstamp is considered one of the most respected and reliable exchanges out there. It is not a scam. Any long-term user of Bitstamp can attest to the fact it has gone through some rough patches in the years of 2014 and 2015. During these two years, Bitstamp suffered cybercrimes where it was even forced to suspend trading. In 2014, Bitstamp specifically stopped withdrawals for up to two days for some users in a bid to stop hackers from accessing private keys. The hackers were demanding a sum of 75 Bitcoins which Nejc Kodric, CEO of Bitstamp, refused to negotiate with the hackers citing that they don’t negotiate with terrorists.
In 2015, a hefty sum of 19,000 Bitcoins were stolen by hackers from Bitstamp. The hackers utilized Skype and email communications with Bitstamps’s employees to successfully introduce malware into Bitstamp’s system. In this manner, they were able to access private keys and made away with 19,000 Bitcoins. News about the hack was kept quiet for about six months until someone from the inside leaked information to the public about the hack.
However, since the last hack in 2015, operations on Bitstamp have been relatively smooth. After suffering those two major attacks, it seems like Bitstamp did learn from this incidents and took measures to update its security features to make it safe for users.
What currencies can you buy, sell and margin trade on Bitstamp
Bitstamp was originally a Bitcoin exchange platform until January 2017. Currently, it supports other cryptocurrencies such as Litecoin, Ripple, and Ether. Ether was added to the platform on August 17, 2017. Bitstamp doesn’t accept other digital currencies at the moment. Apart from digital currencies, Bitstamp also accepts trading between digital currency and fiat currency such as USD and EUR.
Current Bitstamp Login and Security Features
secure After the hacking attempts earlier, Bitstamp ensured that it brought in some concrete ways to the exchange platform for its users. For instance, Bitstamp holds private keys of the user’s in its platform. Therefore, users of the platform must put 100% trust in the company to safeguard and protect their cryptocurrency. However, it would be a splendid idea to store your digital currency in an outside wallet where you have control over your funds. It’s always recommended that you use the platform only when you are ready to trade. For Bitstamp login, users must use passwords and two-factor authentication (2FA).
Their security features are strict and thorough. It is proven by the rigorous screening one goes through upon registration to their system. After filling up the registration form, a customer ID and password is sent to your email inbox. These logins are used by you to login to their site whereby you will be prompted to change your password immediately. Afterwards, you are asked to verify your account by providing the following
• ID number and a full scan copy of the ID.
• Your names as they appear on the ID.
• Postal address.
• Date of birth.
• A scanned copy of a utility bill of no later than three months.
• Country of residence.
• A phone number.
Bitstamp uses the ID scan and the utility bill to prove your name and address. The scanned copies should be of high quality and not expired. After that, Bitstamp takes up to three business days for Bitstamp support to accept your application.
Bitstamp Fees
Bitstamp charges some fees for different services such as depositing, withdrawing and trading. It also charges its customers a monthly operational charge. Below are some of the ways Bitstamp charges for services.
- International Wire Transfers.
International wire transfers cost you about 0.05% to deposit. The minimum fee is set at $7.5. Withdrawals through international wire transfers cost 0.09% with the minimum being set at $15. - Credit Cards.
The fees for using a credit card to make purchases vary depending on the amount of transaction involved. For transactions less than $500, it charges 8%. For amounts between $500 and $1000, it charges 7%. For any amounts between $1,000 and $5,000, it costs 6% for purchases made. For any purchases above $5,000, its costs 5%.
For withdrawing funds from the platform using credit cards, Bitstamp charges a flat rate of $10 for amounts that don’t exceed $1,000. For any transfers exceeding the $1,000 amount, you are charged a standard fee of 2% of the overall amount. As seen, it is highly convenient and cheaper for high volumes of transactions. - Trading.
For trading, the costs depend on the number of volumes traded. The percentage cost usually ranges between 0.10% and 0.25%. The higher the amount traded, the lower the percentage cost incurred and vice versa. - Operational Fees.
Bitstamp charges certain amounts for the use of its platform. A fee of $1.95 is charged to every account monthly. Declined cash withdrawals are charged $0.55. For an account that is dormant, charges are $5.
Withdrawing using BitGo instant costs about 0.1%. It is free to deposit using SEPA. However, you will incur a cost of 0.90 EUR to withdraw using SEPA.
Transfer limits On Bitstamp platform
Bitstamp stipulates a minimum dollar value of $5 for all trading in pairing on the platform to reduce the effect of rounding. For withdrawals with SEPA, the minimum cost is $10.
The Benefits of Bitstamp
In as much as Bitstamp has suffered major hacking attempts, it’s still considered the most reliable platform. It has remained so because of the following:
• It has a very simple interface that is compatible with all devices, thereby, making it easy and quick to use.
• It offers low fees for significant trading transactions, thereby, facilitates large volumes for buying and selling.
• It supports the use of debit cards, credit cards and bank transfers for the purchase and sale of cryptocurrencies.
• It stores 98% of its coins in cold storage. It does so to protect customer’s digital currency in secure vaults. The rest is kept online for trading purposes.
• It recently extended its services to multiple countries and, thus, it is available globally.
The Challenges of Bitstamp
Like any other innovation out there, Bitstamp is not immune to challenges that affect it. The following are some of the key identifiable challenges that you can accept if you chose to use Bitstamp. These include:
• It is not newbie friendly. It is difficult for a newbie to instantly use the platform. However, it is not impossible.
• It charges a higher fee of between 5 to 8% for credit card deposits and purchases.
• Users are required to supply an immense amount of personal information as a standard vetting procedure especially when transactions hit a certain threshold.
• It favours user’s transacting in large volumes of digital currencies unlike lower quantities of cash. It translates to higher fees for smaller volumes of transactions.
• Bitstamp does not support all digital coins. It only supports a few, and it is extremely slow to add on to the list other major altcoins.
• Verification of identity along with address is a must and takes up to three days for approval.
Bitstamp versus Kraken
Compared with alternative digital currency exchanges such as Kraken, Bitstamp seems to be way ahead and doing even much better. For example, Kraken charges both deposit and withdrawal fees whereas, withdrawing and depositing is free with Bitstamp. Kraken also offers a weak user interface for mobile users, unlike Bitstamp’s interface which is user-friendly and easy to use even on mobile. However, Bitstamp is not at all positive as it has recently started receiving negative comments from users globally. However, when compared to Kraken, Bitstamp is more reliable and reputable as it has been in the industry for the longest time.
Customer Support
Bitstamp’s customer support usually responds to user queries within an hour. However, there are conflicting views from different users of the platform. Some people claim that Bitstamp’s customer support was very friendly and prompt in responding to their emails. Others claim that their emails went unanswered for weeks with some getting replies and others feeling ignored. The best option for users is to familiarise themselves with charges incurred for services. It is a sure way to avoid getting in touch with customer support. Unless it is an unexpected occurrence, then you can use the platform without the consistent need for customer support.