Bitstamp Review - Is It the Right Crypto Exchange for You?

Anna Petrov -

Summary

Bitstamp Offers lower fees compared to many of its competitors, Bitstamp presents itself as an attractive option for investors who are mindful of costs. Its user-friendly interface caters to a range of users, from novices to seasoned crypto traders. However, it's worth noting that some key cryptocurrencies are absent from its offering. Dive into our in-depth Bitstamp review to determine if it's the right platform for your trading needs.

About Bitstamp:

Bitstamp is one of the oldest active cryptocurrency exchanges, having been founded in 2011. It's considered a user-friendly platform with very reasonable trading fees, making it a good choice for those who are just starting out in the world of cryptocurrency. Bitstamp offers access to the leading cryptocurrencies and many popular altcoins, with a total of 70 different cryptocurrencies available for trading.

How does Bitstamp Work?

Bitstamp operates as a cryptocurrency exchange platform where users can purchase, sell, and trade a variety of digital currencies. It provides several methods for depositing and withdrawing funds, such as ACH bank transfers, debit and credit card transactions, and international wire transfers. For cost-effectiveness, bank transfers are the most suitable option since ACH deposits and withdrawals are free of charge.

The Bitstamp platform is accessible through a web browser or via its mobile application, which is available for both iOS and Android devices. While its standard trading platform suffices for a majority of investors, Bitstamp also provides Tradeview, a platform designed to cater to the needs of more advanced traders.

For those interested in earning additional cryptocurrency rewards, Bitstamp offers a feature known as Bitstamp Earn. This feature allows users to stake certain cryptocurrencies, enabling your digital assets to generate returns.

Bitstamp Fee Breakdown:

Bitstamp implements a tiered fee system, where the trading fees are determined based on your trading volume over a 30-day period. Here's a glimpse of the fee structure for users with a monthly trading volume of up to $50 million:

  • Under $10,000: 0.50%
  • Under $20,000: 0.25%
  • Under $100,000: 0.24%
  • Under $200,000: 0.22%
  • Under $400,000: 0.20%
  • Under $600,000: 0.15%
  • Under $1,000,000: 0.14%
  • Under $2,000,000: 0.13%
  • Under $4,000,000: 0.12%
  • Under $20,000,000: 0.11%
  • Under $50,000,000: 0.10%
  • Under $100,000,000: 0.07%
  • Under $500,000,000: 0.05%
  • Under $2,000,000,000: 0.03%
  • Under $6,000,000,000: 0.01%
  • Under $20,000,000,000: 0.005%
  • More than $20,000,000,000: 0.0%  (Data Source: Bitstamp)

ACH transfers, encompassing both deposits and withdrawals, are processed free of charge. Thus, by using bank account transfers, you only incur Bitstamp's reasonable trading fees.

However, credit and debit card purchases on Bitstamp are subject to a 5% fee. While it's common for cryptocurrency exchanges to levy fees on card purchases, a 5% fee is somewhat steep compared to many other platforms. Nonetheless, the most economical method for purchasing cryptocurrency remains to be via ACH transfer.

Are Your Funds Safe with Bitstamp?

Bitstamp is highly secure and ranks among the safest platforms for cryptocurrency. It holds 98% of assets in offline, or cold, crypto storage, which is considered the most secure method for storing cryptocurrency because it's immune to online hackers. Only a minimal portion of funds kept in hot storage (online) are utilized for daily trading activities.

Furthermore, Bitstamp enhances its security through a crime insurance policy that provides coverage against theft. However, it's important to note that this insurance applies only when the exchange itself is compromised, not when individual accounts are breached due to stolen login credentials.

Bitstamp also provides additional security measures to ensure the safety of accounts and customer assets. These include two-factor authentication (2FA) and address whitelisting. With 2FA, you are required to authenticate your login with a password and an additional verification method, like a code sent to your mobile device. Address whitelisting, on the other hand, allows you to designate specific addresses that are authorized to receive withdrawals from your account.

What are Bitstamps Limitations?

However, Bitstamp also has some limitations. It experienced a significant security incident in 2015, which resulted in the loss of $5.2 million worth of Bitcoin. Furthermore, the platform does not support margin trading, a feature desired by many experienced traders.

Bitstamp also lacks a rewards card, a feature common in many other exchanges that allow users to use their crypto without having to cash out. On the security ranking site CER.live, Bitstamp received a BB ranking, and it doesn't hold a spot among CER's top 50 best-ranked cryptocurrency exchanges. The platform also doesn't offer live chat support, though users can send a support ticket via email if they prefer text-based customer support.

In Conclusion

In conclusion, Bitstamp stands out as one of the oldest and most established cryptocurrency exchanges in the industry. Its user-friendly platform, wide selection of leading cryptocurrencies and popular altcoins, and a variety of order types cater to both beginners and more advanced traders.

Bitstamp's competitive fee structure and unique offering of phone support further enhances its appeal. However, despite these strengths, it is not without its shortcomings.

The platform's past security incident, lack of margin trading, absence of a rewards card, and lower security ranking on CER.live are areas where improvement could be made.

As with any financial decision, potential users should thoroughly research and consider these factors to determine if Bitstamp is the right cryptocurrency exchange for their specific needs and risk tolerance.