Selecting the appropriate trading platform is a crucial decision for any cryptocurrency trader. With numerous options available, it’s easy to get overwhelmed and choose a platform that doesn’t fulfill your needs. Bitstamp is one of the earliest and most popular cryptocurrency exchanges, and in this review, we’ll assess its features to determine the type of traders it’s best suited for.
Bitstamp is a well-established cryptocurrency exchange that has been in operation since 2011. It offers a user-friendly interface, a wide range of trading pairs, and a variety of features that cater to different types of traders. Whether you’re a seasoned trader or a beginner, Bitstamp has something to offer.
In this review, we’ll delve into Bitstamp’s features, fees, security measures, and more. We’ll also discuss the pros and cons of using Bitstamp and help you decide if it’s the right platform for you.
What is Bitstamp?
Bitstamp is a well-established cryptocurrency exchange that has been in operation since 2011. Registered in Luxembourg but headquartered in the United Kingdom, the platform has gained popularity among traders worldwide. Bitstamp’s user-friendly design caters to both beginner and experienced traders, making it an ideal choice for a wide range of users.
Bitstamp Review – Pros
The Bitstamp trading platform has several advantages associated with it, which include:
Supports Credit or Debit Card Purchases
One of Bitstamp’s key advantages is its support for credit and debit card transactions. This feature makes it easy for users to purchase cryptocurrencies using these payment methods, giving Bitstamp an edge over other exchanges that don’t offer this option.
While Bitstamp does charge fees for credit and debit card transactions, the convenience of having this option outweighs the costs. The ability to add funds quickly and easily through credit and debit cards makes Bitstamp a more appealing choice than other platforms that only support bank transfers and wires, which can take several days to process.
The almost instantaneous deposit process is another significant benefit of using Bitstamp. With credit and debit card support, users can add funds to their accounts quickly, allowing them to take advantage of market opportunities without delay.
Competitive Trading Fees
Bitstamp’s competitive trading fees are another significant advantage of using the platform. The fees are structured in a commission-based system, where users are charged based on their trading volumes. This system rewards active traders and investors who make a high volume of trades, as they can enjoy lower trading fees.
Compared to industry standards, Bitstamp’s trading fees are significantly lower, making it an attractive choice for those who frequently trade cryptocurrencies. This fee structure incentivizes users to trade more, as they can save on fees while still enjoying the platform’s other benefits.
Regulated Exchange
One of Bitstamp’s key advantages is its fully regulated and licensed status in the European Union. This sets it apart from many other cryptocurrency exchanges, which often lack regulatory oversight. The cryptocurrency market’s volatility makes regulated exchanges like Bitstamp all the more important, as they provide a safe and secure environment for users to trade and store their digital assets.
While many exchanges are still in the process of growing and expanding, Bitstamp has established itself as a leader in regulatory compliance. This commitment to safety and security should reassure investors that their funds are in good hands.
Available Worldwide
One of the fundamental principles of the cryptocurrency and blockchain industry is accessibility, allowing users to transact with anyone worldwide. However, many popular exchanges limit their reach due to regulatory restrictions, hindering their global accessibility.
Bitstamp stands out in this regard, as its regulatory compliance with EU authorities enables the platform to offer its services to users from all over the world. This means that anyone can access the platform and trade various cryptocurrencies, regardless of their location.
While some countries may have limitations on deposit methods, such as bank transfers or credit/debit cards, Bitstamp ensures that users can still deposit cryptocurrencies. This highlights Bitstamp’s commitment to accessibility and its goal of making cryptocurrency trading available to everyone, everywhere.
Good Customer Support
One of the platform’s significant advantages is its excellent customer support, which is available 24/7. Bitstamp’s customer support services are divided into three parts, ensuring that users can quickly and easily find solutions to their issues.
Firstly, users can utilize the live chat feature, which is available 24/7 and can assist with basic and common queries. This feature is convenient and efficient, allowing users to quickly resolve their issues without having to wait.
If a user’s issue is more complex, they can contact Bitstamp’s phone support helpline, which is also available 24/7. This ensures that users can receive instant assistance, even if their query is more complicated.
For even more complex queries, Bitstamp offers email support, which has a fast turnaround time. This means that users won’t have to wait long for a response, ensuring that their issues are resolved promptly.
In addition to these support options, Bitstamp also has an extensive FAQs page that answers many basic questions, allowing users to quickly find solutions to their problems without needing to contact customer support.
Overall, Bitstamp’s customer support services are top-notch, providing users with multiple options for resolving their issues quickly and efficiently.
Charting Tools
As previously mentioned, Bitstamp offers a range of tools and features that cater to both novice and experienced traders.
One of the platform’s standout features is its comprehensive charting tools, which provide traders with a wealth of options for analyzing charts in detail. These tools enable traders to make better-informed trading decisions, making Bitstamp an attractive choice for those seeking a reliable and versatile platform.
The charting tools available on Bitstamp are designed to be highly customizable, allowing traders to tailor their charts to suit their individual needs and trading strategies. Whether you’re a seasoned trader or just starting out, Bitstamp’s charting tools will help you gain valuable insights into market trends and movements.
Staking rewards
Cryptocurrency traders often hold their assets during market downtime, awaiting favorable conditions to trade. For these traders, it’s beneficial to use an exchange that offers staking, allowing them to earn passive income on their idle cryptocurrencies. Unfortunately, many exchanges don’t provide this feature.
However, Bitstamp does. By staking your cryptocurrencies, you can earn rewards in exchange. Bitstamp’s staking services make it easy and convenient for you to stake your assets and start earning rewards.
When you use Bitstamp’s staking services, the rewards you earn will be transferred to your account minus a 15% fee, which is in line with industry standards. This fee covers the cost of Bitstamp providing a seamless staking experience for you.
Currently, Bitstamp offers staking opportunities for users with Ethereum and Algorand cryptocurrencies in their accounts. Take advantage of this feature to earn passive income on your idle assets and maximize your trading experience with Bitstamp.
Bitstamp Review – Cons
Here are some potential downsides to consider when using the Bitstamp trading platform:
Small Range of Cryptocurrencies
While Bitstamp offers a number of benefits, it also has some drawbacks, primarily related to the limited number of cryptocurrencies available for trading.
We’ll dive deeper into the specific cryptocurrencies available on the platform later in this review, but it’s worth noting upfront that the selection is limited to just a few major currencies. This may make Bitstamp less appealing to traders looking to trade altcoins.
Lengthy Verification Process
As a secure and reliable exchange, Bitstamp requires users to go through a lengthy verification process to ensure their identity and address are authentic.
However, the platform’s approval process is notorious for requesting an excessive amount of personal information from users, which goes against the principles of anonymity that are central to the cryptocurrency world. This invasive verification process may deter some users from setting up an account with Bitstamp.
Shorting is Not Available
Cryptocurrency traders typically engage in two types of transactions: going long (buying assets with the expectation of price appreciation) and going short (selling assets with the expectation of price depreciation). While other exchanges accommodate both strategies, Bitstamp does not allow users to short cryptocurrencies through its web platform or mobile app.
This limitation is problematic as it restricts traders from utilizing a variety of trading strategies that involve short selling. As a result, Bitstamp may lose appeal as a cutting-edge trading platform.
No Maker-Taker Fee Structure
Unlike many other major exchanges, Bitstamp does not adopt a maker-taker commission structure. Typically, maker-taker fee structures incentivize users to add liquidity to the market by charging lower fees for makers and higher fees for takers.
However, Bitstamp charges a flat fee for all trades, regardless of whether the user is a maker or a taker. While this fee structure may seem straightforward, it may deter advanced traders who rely on the maker-taker system to optimize their trading strategies.
Cryptocurrencies Available on Bitstamp
While Bitstamp provides access to a range of cryptocurrencies, its selection is limited compared to other major crypto exchanges.
Currently, Bitstamp offers over 54 cryptocurrencies, including:
- Bitcoin
- XRP (Ripple)
- Litecoin
- Ethereum
- ALGO
- Bitcoin Cash
- XLM
- Link
- OMG Network
- USD Coin
- PAX
These cryptocurrencies can be traded against other digital assets or fiat currencies like USD, GBP, and EUR through the Bitstamp platform.
Bitstamp Review – Fees
All trading platforms charge two types of fees: trading fees and non-trading fees.
Bitstamp Trading Fees
Trading fees are charges incurred for placing orders on the platform and executing them. Most cryptocurrency exchanges charge trading fees through spreads or commissions.
Spreads
Spreads refer to the difference between the bid price and the ask price. This model is used by market-maker trading platforms that act as counterparties in trades. As a result, there’s a difference between the buy and sell prices at any given time, resulting in a spread fee.
When buying and selling an asset simultaneously, the spread fee can incur a loss.
Commissions
The alternative trading fee is a flat commission on every trade, usually a small percentage of the trading volume. This commission decreases as trading volume increases.
Bitstamp Fee Structure
Bitstamp operates a straightforward commission-based fee structure, with fees dependent on your 30-day trading volume. Unlike other platforms, Bitstamp does not charge spreads.
Bitstamp Non-Trading Fee
In addition to trading fees, cryptocurrency platforms often charge various incidental fees. Bitstamp’s fees are as follows:
Deposit Fees
Bitstamp charges fees for depositing funds, depending on the method used:
- Debit card: $10 fixed fee for deposits under $10,000; 2% flat fee for deposits above $10,000
- Credit card: 5% of deposit amount
- SEPA European Bank Transfers, cryptocurrency transfers, ACH transfers, and Faster Payments for UK users: free
Withdrawal Fees
Withdrawal Fees
Like deposit fees, most cryptocurrency exchanges charge withdrawal fees. Bitstamp’s fees are as follows:
- Debit/credit card withdrawals: free
- SEPA Bank withdrawals: 3 Euros
- Wire transfers to a bank account: 25 Euros
Bitstamp Platform Features
The Bitstamp exchange has gained popularity among cryptocurrency traders due to its unique features. These features are discussed in detail below:
Fiat-to-Crypto Gateway
One of the key benefits of using Bitstamp is the ability to trade cryptocurrencies using fiat currencies such as USD, GBP, and EUR. This allows users to easily convert their fiat currencies into crypto and vice versa, all while paying competitive fees and enjoying the benefits of a highly liquid exchange.
As one of the oldest and most reputable cryptocurrency exchanges in the world, Bitstamp continues to expand its offerings through initial coin offerings and direct listings, making it a popular choice for both beginner and advanced users.
Another unique advantage of Bitstamp is its ability to seamlessly convert fiat currencies into crypto, a feature that sets it apart from many other exchanges in the market.
Regulatory Compliance
In the nascent crypto industry, regulation plays a vital role in safeguarding users’ assets and preventing fraudulent activities. While many crypto platforms remain unregulated due to their lack of a fixed base and unclear legal frameworks, Bitstamp has taken the lead in regulatory compliance.
Bitstamp is the first fully licensed custodial cryptocurrency exchange in Europe, regulated by the Luxembourg Financial Industry Supervisory Commission (CSSF). This distinction makes it an attractive option for investors seeking a secure and reliable platform to hold their digital assets.
As one of the few exchanges worldwide with this license, Bitstamp sets a benchmark for industry standards and demonstrates its commitment to providing a safe and secure trading environment.
Debit and Credit Card Purchases
Bitstamp offers users the convenience of purchasing cryptocurrencies directly through their credit or debit cards, eliminating the need for traditional deposit methods like bank transfers that can take several days to process.
Through the Bitstamp mobile app, users can instantly buy cryptocurrencies with just a few clicks. The process is simple: go to the asset’s page, select the desired quantity, choose the debit or credit card for the transaction, and click “buy.” The transaction is executed almost instantly.
Please note that instant buy functionality may be limited to Bitcoin and a few other major cryptocurrencies, but this selection is expanding over time.
Low Fees for SEPA
In addition to credit and debit cards, Bitstamp offers European users the convenience of depositing and withdrawing funds directly to their bank accounts via SEPA transfers or international wire transfers.
While wire transfers may incur slightly higher fees compared to SEPA transfers, Bitstamp’s fees are competitively low, as discussed in the Non-Trading fees section of this review.
By providing users with the option of easy deposits and withdrawals through SEPA or bank transfers, Bitstamp makes it easy and affordable for European traders to use their platform.
Mobile App
Bitstamp’s mobile app is designed for convenience and accessibility, available on both iOS and Android devices. Users can easily download the app, sign in, and start trading assets directly through the mobile interface.
The app’s user-friendly design makes it easy for beginners to navigate and use, while more advanced traders can customize the interface and add features to suit their needs for effective trading.
Bitstamp’s mobile app aims to cater to traders at all levels of experience, ensuring that everyone can use it with ease.
Bitstamp Safety Measures
In 2015, Bitstamp fell victim to a hacking incident that resulted in the loss of over $5 million (19,000 BTC). This targeted phishing attack was one of the most significant cyber attacks on a cryptocurrency exchange at the time and led to a decline in customer confidence in the platform.
However, Bitstamp has since strengthened its security measures to ensure that such an incident does not recur. The platform has implemented industry-grade security features, which are discussed below, to protect its users’ assets.
Offline Storage
Bitstamp sets itself apart from other cryptocurrency exchanges by storing over 85% of its assets in cold wallets that are not connected to the internet. By keeping the majority of assets offline, Bitstamp ensures that they are not vulnerable to digital threats, providing an added layer of security for its users.
Multi-Signature Wallets
In response to the 2015 security breach, Bitstamp introduced multi-signature wallets as part of their efforts to enhance the exchange’s security systems.
These wallets provide an additional layer of protection, requiring multiple private keys to authorize transactions. This makes it significantly more difficult for hackers to gain access to a user’s wallet and perform fraudulent transactions, providing greater security for users’ assets.
Auditing
As a regulated exchange, Bitstamp is required to undergo an annual audit of its finances and liquidity by one of the Big 4 auditing firms. This ensures that the exchange’s financial stability and liquidity are maintained, providing users with added security and peace of mind.
Two-Factor Authentication
To enhance security, Bitstamp encourages users to enable two-factor authentication (2FA) on their accounts. This means that transactions cannot be completed without verification through a code provided by the Google Authenticator app.
This additional layer of security ensures that accounts and wallets are protected from unauthorized access, preventing transactions from being made without the user’s physical device.
Summary
Bitstamp is a popular cryptocurrency trading platform in Europe, but it’s essential to carefully evaluate its features before deciding to use it.
On the positive side, Bitstamp offers a user-friendly interface and competitive fees. The customer service is responsive and helpful, and the platform supports various payment methods.
However, there are some drawbacks to consider. Bitstamp lacks a maker-taker fee schedule, and it has been hacked in the past, which raises concerns about security. Additionally, the platform’s cryptocurrency offerings are limited compared to other larger exchanges.
Ultimately, it’s crucial to weigh these factors and make an informed decision about whether Bitstamp is the right platform for your cryptocurrency trading needs.
