Bitstamp Review – How Does This Cryptocurrency Exchange Measure Up?

As one of the oldest exchanges in the cryptocurrency space, Bitstamp has been attracting users around the world to use their services. What makes this exchange so reputable, and how have their services evolved over time?

A Brief History of Bitstamp

Bitstamp was founded in Slovenia, by Damijan Merlak and Nejc Kodrič, in 2011. The project was aimed at providing European customers a competitive solution to Mt. Gox, which was (at the time) the dominating exchange to buy and sell Bitcoin. With Mt. Gox being the primary exchange (handling up to 70% of all Bitcoin transactions), users often had to wait extensive periods of time for their transactions to complete, as Mt. Gox’s business practices were not necessarily practical. Bitstamp emerged onto the scene to raise the bar for how Bitcoin and other cryptocurrencies should be traded. Nathaniel Popper’s “Digital Gold” features a cameo of the Bitstamp team, as Bitcoin’s early history is chronicled from its mysterious beginning to the start of its adoption, and is a recommended read for anyone interested in cryptocurrency. 

Since their start, Bitstamp has opened their doors to worldwide clients, opening offices in the UK in 2013, Luxembourg in 2016, as well as current offices in New York and London. At its peak, Bitstamp was perhaps the leading exchange in the space, trading over $700 million a day. Today, with a growing number of exchanges opening in the industry, Bitstamp isn’t as popular, but still remains a valid exchange for anyone needing a reliable exchange to buy and sell crypto assets. 

Opening an Account on Bitstamp

To open an account on Bitstamp, simply click on the green “Register” button found at the top right-hand corner of Bitstamp’s front page. From there, Bitstamp will ask if the account is for Personal Use, or for Corporate Use; click the proper option. 

Bitstamp will then ask for the user’s first and last name, email address, and compliance with Bitstamp’s Terms of Use and Privacy Policy (read the terms and put a checkmark in the box). 

After providing the required credentials, Bitstamp will send an email containing a verifying link; once the user clicks the embedded link to verify the account, Bitstamp will then allow the user to create a password. 

After creating a password, Bitstamp will issue a unique User ID, which can be used to login to the site. Before users will be able to access their accounts, they will be required to enter and upload personal documents, financial information, and enable security functions. This request may seem hefty, but this information is required to meet AML/KYC regulations. 

Once all of the required information is submitted, the user can deposit funds and begin to use the platform. Bitstamp currently offers their services to all 28 member countries of the EU, as well as support for well over 50 countries outside of the EU, including the U.S., South Korea, and Australia. Bitstamp has a minimum order size of 25.00 USD/EUR for all USD/EUR trading pairs, and a 0.001 BTC minimum order for any trading pair with BTC as the denominator. 

Bitstamp Product Offerings

There are currently 6 tradable assets on Bitstamp, offered in different pairs. Bitcoin is tradable as BTC/USD and BTC/EUR. Litecoin is tradable as LTC/USD, LTC/EUR, and LTC/BTC. Ethereum is offered on the platform as ETH/USD, ETH/EUR, and ETH/BTC. Bitstamp also offers Bitcoin Cash as BCH/USD, BCH/EUR, and BCH/BTC; as well as XRP as XRP/USD, XRP/EUR, and XRP/BTC. A unique offering that Bitstamp makes available is a USD/EUR trading pair, allowing customers to swap fiat currencies. Bitstamp allows users to buy/sell instantly, as well as placing Market, Limit, and Stop orders. 

Bitstamp’s Fees

Bitstamp operates on a sliding scale Fee Schedule, starting at 0.5% per trade for transactions totaling $10,000 or less over a 30-day period, with 0.0% fee for $10 billion traded over 30 days. Users will be moved to the next tier immediately after meeting the volume requirements over a 30-day time span. 

SEPA deposits to the exchange warrant no fee from the user, however, a SEPA withdrawal will incur a 3.00 EUR fee. Credit Card purchases have a 5% fee on all purchases, not including any additional fees that may be added by the credit card company.

Bitcoin, Litecoin, Ripple (XRP), Ethereum, and Bitcoin Cash deposits do not have any deposit fees. There is a 0.0005 BTC fee for withdrawals from the platform, or a 0.1% fee using BitGo Instant to withdraw. Litecoin’s withdrawal fee comes at 0.001 LTC; XRP’s withdrawal at 0.02 XRP; Ethereum at 0.001 ETH; and Bitcoin Cash’s withdrawal fee set at 0.0001 BCH. 

Bitstamp’s fee schedule can be found here. 

Bitstamp’s Platform and Tools

Bitstamp’s trading platform allows customers to spot-trade in any of the pairs of the 6 assets offered. The trading window can be found by clicking the Tradeview button. The trading window features a sleek design on a dark colored background. Users can select their desired asset in a drop-down button found below the header bar at the top of the screen.

In the middle of the window, a candle chart equipped with TradingView’s plethora of tools is offered to the user, optimizing the trading experience. The trading history for the selected asset is found on the left hand side of the window, with a current order book located under the chart. The order book can be switched to a depth chart with the click of a button. Users can place their orders to the right of the window, with their open orders found below the order terminal. At this time, Bitstamp does not offer leveraged margin trading or contracts. 

Bitstamp does offer a mobile application for trading on-the-go. The features of the application are nearly identical to the desktop version of Bitstamp. The app is supported by both Apple and Android phones, and can be found in the App Store/Google Play. 

Bitstamp’s Customer Service 

For any questions that a customer may have, an FAQ is provided, featuring answers to any common questions that may arise. Most of the question/answers provided are fairly basic in nature. For anyone that may have problems larger than what the FAQ covers, users are encouraged to email Bitstamp’s support team. Their email can be found in the Contact section, located at the bottom footer section of their web pages, on the right hand side. 

What Sets Bitstamp Apart From Other Exchanges?

Bitstamp offers users a straightforward way of spot-trading a small amount of crypto assets. While the list of assets offered is small, those certain cryptocurrencies tend to have more volume, allowing the customers to execute their orders with ease. Back in the days of cryptocurrency’s infancy, Bitstamp offered users the ability to trade Bitcoin much like traders on Wall Street, without having to deal with Mt. Gox’s faulty business practices. It could be said that Bitstamp helped pave the way for how exchanges operate in the industry today.

How Trustworthy is Bitstamp?

Bitstamp requires the use of 2-Factor Authentication to use their website, as well as full identity verification to make deposits and trades on their exchange. This certainly does not do much to protect users, however, their Customer Support does tend to resolve issues. Many users on Trustpilot have given Bitstamp a mid-grade level, with many people claiming to be locked out of their funds. Sites like these can make it hard to discern fact from fiction, as many companies pay for reviews (good reviews for them, or bad reviews against other competing companies). Regardless, these issues should be taken into account. 

The exchange has suffered some fatal blows in its history as an exchange. The first came in 2014, in which the exchange was attacked with a distributed denial-of-service, with the attackers demanding 75 BTC from the exchange. Bitstamp was suspended for multiple days. Kodrič, the CEO, refused to pay the ransom, as complying with “terrorists” was against company policy. The second came in 2015, in which Bitstamp suspended all of their services for a week, after nearly 19,000 BTC was stolen from the exchange. These types of attacks were almost common occurrences on many exchanges in the early days of Bitcoin. 

Conclusion

In the infant days of Bitcoin, Bitstamp offered a viable solution to the travesty of Mt. Gox. The exchange worked their way to the top of the food chain, trading top volumes across the industry. Today, however, Bitstamp’s popularity is waning in the wake of the booming number of cryptocurrency exchanges that have a larger amount of tokens and trading tools to offer to users.