Bitstamp is a cryptocurrency exchange that can boast a solid, good reputation and relatively low fees. Bitstamp is headquartered in Luxembourg, after the company left Slovenia, the place where it was founded, while seeking fewer regulations with the bitcoin activities. For a short period of time, the company resided in the United Kingdom, but later ended up in Luxembourg. Bitstamp is one of those exchanges that are quite complicated for beginners, and our Bitstamp review will disclose this and many other aspects about this cryptocurrency exchange.
General Information About Bitstamp
Company’s Foundation Year: 2011.
Headquarters: Luxembourg and Slovenia.
Deposit Methods: Bank transfer, credit cards, cryptocurrencies (since recently; known as altcoins).
Withdrawal Methods: Bank transfer, altcoins (also since recently).
Fiat Currencies Supported: USD, EUR.
Mobile App: Yes.
Friendly Towards Beginners: No.
Fees: From average to low.
Customer Support: Average.
Community Trust: Very Good.
Bitstamp Review: General Overview
Bitstamp tends to be one of the oldest cryptocurrency exchanges, as it was founded in 2011 (Kraken was founded then too) – at day of the bitcoin development. And in many instances, Bitstamp is a really great platform for investing in bitcoins and other cryptos. The only thing that stops Bitstamp for overtaking Kraken and Coinbase is the exchange’s quite difficult interface, which scares off many beginners.
At the beginning, Bitstamp was created as an alternative to Mt. Gox, a Japanese bitcoin exchange that dominated the European market. After Mt. Gox went bankrupt in 2014 (at one point, it had the share of the world bitcoin market of 70%), such exchanges like Bitstamp, Coinbase, and Kraken grew in popularity and gained sympathy and trust from the users.
Now, when Bitstamp became headquartered in Luxembourg, it allows depositing and withdrawing funds in both USD and EUR. For the European users, it is fairly convenient and lucrative (due to low fees) to deposit their funds in EUR via SEPA bank transfers. This partly has led to the fact that Bistamp is one of the largest crypto exchanges in the European market nowadays. One of the advantages of Bitstamp is that this exchange also offers API keys, which allows the users and developers to create data analytics tools and custom software.
When it comes to positive opinions about Bitstamp, the majority of the users (and this Bitstamp review is not an exception) leave very good feedback about the fees at this exchange. Especially that stands for the European clients (depositing money via SEPA wire transfers is free). The trading fees lower than 0.25% are also something that draws many clients to this exchange. Besides, numerous claims of users who confess that the exchange’s support is far better than those of many major exchanges is also a good sign. Besides, the fact that Bitstamp is licensed also evokes confidence and trust.
On the other hand, depositing fiat money with credit cards is not recommended – that can be salaciously expensive. Though, the fact that depositing funds with credit cards can be expensive is a common thing among cryptocurrency exchanges. Considering that many traders have flocked to Bitstamp recently, it shouldn’t be surprising for you that the verification process may take quite a bit of time.
Another criticism towards Bitstamp is the limited amount of cryptocurrencies available for trading. At the present time, Bitstamp allows to trade only 4 cryptos: bitcoins, Litecoin, Ethereum, and Ripple. Though, one must say that Bitstamp was founded as a bitcoin-only exchange, but later went on to introduce other popular cryptocurrencies.
One of the things many Bitstamp clients lament about is the difficulty of withdrawing the funds via wire transfers. That is connected with the fact that many European banks are quite hostile towards bitcoin-connected operations and crypto exchanges. Even though this doesn’t tend to be the fault of Bitstamp, it gets a large deal of the blame for this as well.
In the previous parts of our Bitstamp review it has already been mentioned that the fees at this exchange tend to be relatively low. Fees for international wire deposits are around 0.05%, though with a minimum fee of 7.50 USD/EUR. The fees for withdrawals via international wire is 0.09% or, at least, 15 USD/EUR. Both deposits and withdrawals are carried out within 2-5 days.
Bitcoin trading fees start with 0.25%. Though, they can be lower for those traders who have reached certain levels of monthly trading volumes:
- 0.24% if the trading volume is more than $20 but less than $100,000.
- 0.22% if the trading volume is less than $200,000.
- 0.20% if the trading volume is less than $400,000.
- 0.15% if the trading volume is less than $600,000.
- 0.14% if the trading volume is less than $1,000,000.
- 0.01% if the trading volume is more than $20,000,000.
Besides, Bitstamp also offers a very useful feature: free bitcoin withdrawals. So if you want to trade bitcoins on other exchanges, you can easily withdraw them from Bitstamp for free. That is achieved in the following way: the company accumulates such requests from many users, withdraws the bitcoins, and then allocates them to those users while covering the fees.
Is Bitstamp Safe?
Our Bitstamp review contains quite complimentary words about the safety of Bitstamp, and that’s not surprising. Even though every investment bears a risk (and especially in cryptos), Bitstamp tends to be among the safest cryptocurrency exchanges.
And even though luckless events may happen to any crypto exchange, it is worth taking a note of how the company dealt with them. First of all, the company suspended withdrawals of bitcoins in February 2014, when it was supposed to be attacked by hackers. The same security measure was undertaken in January 2015, when 19,000 bitcoins were stolen – that stands in a sharp contrast from 850,000 bitcoins, stolen from Mt. Gox.
The interface at Bitstamp
Since those events, everything has been more or less smooth at Bitstamp. At the present time, Bitstamp stores over 98% of all the cryptos in cold wallets, thus keeping the funds of its customers offline in secret vaults. The remaining less than 2% of the cryptos are available for trading.
It is worth noting that Bitstamp is among the leaders in the cryptocurrency world in terms of the security measures. At the present time, the following security measures are available at Bitstamp:
- SMS and email alerts.
- Mandatory email confirmation.
- Two-step verification.
- Fully insured cold storage wallets.
- Pretty Good Privacy (PGP) data encryption used for all the files uploaded to Bitstamp.
Advantages and Disadvantages of Bitstamp
At the end of our Bitstamp review, we would like to summarize the entire article with the list of advantages and drawbacks of this crypto exchange. This can give you a better understanding of where Bitstamp beats its other main competitors.
So, the following advantages of this crypto exchange draw many customers to Bitstamp:
- Large trading volumes, which makes this place a good one for large deals and purchases.
- Allows to buy cryptocurrencies with debit and credit cards.
- Able to boast a very good reputation and absence of prolonged shutdowns in trading.
- Trading and deposit/withdrawal fees are extremely low, if compared to other major cryptocurrency exchanges.
- Tends to be a secure exchange with many advanced security measures.
- Allows the users to obtain API keys.
- Provides the users with detailed graphs and charts.
At the same time, the following disadvantages of Bitstamp make it less attractive for a number of traders:
- The user interface is not that simple and doesn’t suit to beginners.
- Despite being a highly secure exchange, Bitstamp retains control over the private keys to the wallets of its users.
- Depositing funds via credit/debit cards tend to be very expensive.
- Very few cryptocurrencies are available for trading on this platform.
- The exchange is available for users from certain countries, not to everyone.
- The process of account verification tends to be rather long and may exceed 3 days.
- Bitstamp tends to collect extra information about its users, including which competitor services they use.