Coinmama Review – A Straightforward Cryptocurrency Exchange

About Coinmama

For a quick and easy way to buy Bitcoin and other cryptocurrencies, many people search for a non-custodial option that allows them to buy without having to time the market for the best price. In the cryptocurrency space, there are many such options to choose from, and one may inevitably come across Coinmama in their searches. What does this straightforward exchange have to offer customers?

A Brief History of Coinmama

The Coinmama exchange was founded in Israel by New Bit Ventures, during the phase of the world’s booming interest in cryptocurrency, in 2013. New Bit Ventures is currently registered in Slovakia, but the exchange still operates in Israel, today. Coinmama has slowly built a reputation as a dependable exchange for the purchasing of cryptocurrencies, serving over 1.8 million people worldwide. 

Coinmama Product Offerings

As of 2019, Coinmama supports the purchasing of Bitcoin (BTC); Bitcoin Cash (BCH); Ethereum (ETH); Litecoin (LTC); Ripple (XRP); Quantum (QTUM); Cardano (ADA); and Ethereum Classic (ETC). Bitcoin can also be sold on the exchange. These cryptocurrencies can be bought using a bank transfer, or with credit cards (VISA/Mastercard only), using USD; EUR; GBP; CAD; and AUD; thus catering to a large population of the world. The minimum one must spend is $60 USD (or its equivalent in any of the other supported currencies). Users can sell between 0.007 to 1.4622 BTC on the exchange, with the money being deposited into the user’s bank account (SEPA if using a European bank). Users have a daily limit of $5000 (USD), with a monthly limit of $20,000.

Opening an Account on Coinmama

Before signing up with Coinmama, any potential customers should make sure their country is supported by the exchange. Currently, Coinmama serves over 188 countries worldwide, with more countries being added regularly. Due to regulatory restrictions, Coinmama does not provide service for China; Cuba; Crimea; Iran; Israel; Lebanon; Nigeria; North Korea; the Palestinian Territories; Somalia; South Sudan; Syria; and Zimbabwe. Furthermore, because each U.S. state requires its own licensing, Coinmama is not offered in the states of Connecticut; the District of Columbia; Florida; Hawaii; Idaho; Iowa; New Mexico; New York; Oregon; Utah; and Vermont; as well as the U.S. territories of American Samoa; Guam; the Northern Mariana Islands; Puerto Rico; the U.S. Minor Outlying Islands; and the Virgin Islands. If your country is not listed, it is recommended to find another (similar) exchange that operates within the legal framework of your residing country. 

If your country/state is in fact supported by Coinmama, the process of creating an account is easy. Simply click on the blue “Sign Up” button, found at the top header of Coinmama’s website. The new customer will be required to enter their email address, desired password, first and last name, and country/state of residence. All customers must be 18 or older to join the exchange. Once the required credentials are entered into the corresponding boxes, and the user clicks “Create Account,” Coinmama will send a verification email to the given email address. This email contains a link that will verify that the email provided is valid; users will not have access to their accounts until the email is verified. 

Once the email is verified, the new user will be required to verify their identity before any purchases can be made on the exchange. This is to comply with Anti-Money Laundering and Know-Your-Customer regulations to prevent fraudulent activity on the exchange. The first tier of verification requires information such as: full name; phone number; gender; home address; city; country; zip code; and state (if in U.S.). The next step in verification requires the upload of a photo of a personal government ID (driver’s license, passport, etc.). The first tier of verification will allow the customer to purchase up to $10,000 in cryptocurrencies. Level 2 verification requires the upload of a utility bill (to further verify identity), as well as a selfie with the previously uploaded ID. To advance to Level 3 of verification, one needs to contact support to enter the proper steps. Please note that an account only needs a minimum of Level 1 verification in order to use the platform. From there, the customer is free to use the platform as they may see fit (within account limits). According to Coinmama, verification time runs about 30 minutes. 

Coinmama Fees

Because Coinmama is a brokerage platform, the fees are slightly higher than those found on spot trading platforms. This is because the brokerage is acting as the middle man between the customer and the cryptocurrency exchange, allowing customers to purchase cryptocurrencies without having to “time” the markets for the best price. Coinmama establishes their prices based upon the XBX Index from TradeBlocks. For all purchases, Coinmama has a 5.9% fee. This 5.9% fee is already added into the price that customers see prior to purchasing. 

If a customer is using a credit card to complete their purchase, an additional 5% fee will be added to the total cost of the purchase, not including any fees from the credit card company itself. This method can end up being pretty costly, as the total a customer will be paying will be at least 10.9% above the market price at any given time. Bank transfers are much more cost effective, as SEPA payments have a 0% processing fee (with Coinmama’s 5.9% fee still intact). SWIFT transactions carry a £20 (GBP) transaction fee for any transaction that happens to be less than $1000 (USD), with no processing fee for any transaction above $1000 USD. SEPA and SWIFT transactions may also have bank transaction fees that are inherent to the customer’s bank itself.

Coinmama Platform & Tools

Making a purchase/sell order on Coinmama is very simple. To buy, simply hover over the “Buy” button at the top header of the website. This will bring into view a dropbox with all of Coinmama’s available cryptocurrencies. 

After selecting the desired asset, Coinmama will allow the customer to choose which base currency they will be using to complete the order (USD/EUR/CAD/GBP/AUD). 

Coinmama does offer 3 preset options: a $100 buy, a $500 buy, and a $1000 buy. The customer is free to purchase as much or as little as they would like (within the limits). After inputting the amount the customer would like to spend, clicking “Buy Now” will start the process of completing the order. Coinmama will then ask for the customer’s wallet address. After completing the purchase, the funds are sent immediately to the given wallet address. 

To sell Bitcoin (the only cryptocurrency customers can sell on Coinmama), simply click on the “Sell” button on the header of any of Coinmama’s webpages.

 This will direct the customer to a terminal that allows the user to input the total amount of BTC they wish to sell, and in which currency they choose to receive the payout. All payouts are sent to a bank account, with all European bank transactions using SEPA transactions for payouts. As mentioned previously, users can only sell between 0.007 to 1.4622 BTC on the platform. 

Coinmama also has an Affiliate program that allows users to capitalize on referring friends and family to use the exchange. Users can earn 15% commission on all purchases made by the referred users, with no limits to how much can be made. This is an enticing incentive to bring others to use their platform. Earnings can be paid in BTC or via wire transfer, and will only be paid out after 3 different users have completed 3 successful orders. 

Coinmama Security & Customer Service

Because Coinmama is not a custodial exchange, Coinmama has a slightly smaller chance of being compromised. If it had been compromised, user funds (in cryptocurrency) would likely not be affected, as no user funds are held on the site, though it must be said that user data and information would likely be compromised.

However, in the case of any problem one may hve, Coinmama does have a Knowledge Base in which customers can find articles relating to many different subjects covering the gamut of Coinmama’s business workings. 

Should users not find the needed answers in the Knowledge Base, they are more than welcome to open up a support ticket with Customer Service. A live chat function is also available for any user needing immediate assistance. 

What Makes Coinmama Different?

Coinmama is far different than spot trading and margin trading exchanges like Binance and Bittrex because Coinmama is purely a brokerage exchange, allowing users to buy and sell without having to read charts and time the markets just right. Coinmama also provides services to a wide swath of countries, allowing purchases to be made in multiple currencies via bank transfers or credit cards. Coinmama also sends users their purchased cryptocurrency immediately, as opposed to other brokerages where a user may have to wait multiple days before they can even withdraw the funds from the exchange. This allows users to capitalize on the price at any given moment (fees aside). Their referral program is also highly enticing as many referral programs simply pay out a small one-time amount of fiat or crypto for every user signed up, whereas the amount of commissions a customer could make on Coinmama is limitless. 

Is Coinmama Trustworthy?

The issue of Coinmama’s trustworthiness is a topic of debate. Many people have successfully purchased and sold cryptocurrency on the exchange in the past, with many still using the platform with no problems. This is a given. However, if one were to search for reviews on the exchange, many have given poor feedback regarding Coinmama, in particular that Coinmama is a scam. Granted, if one were to search for customer reviews on nearly any exchange, there is almost certainly going to be a few people claiming that the given exchange is a scam. However, these customer reviews do need to be taken with a grain of salt, as many companies do pay individuals to leave negative reviews on other companies. Coinmama does require a hefty amount of personal information up front, before any cryptocurrency can be bought at all. Many people do not feel comfortable having to provide more than just the basic name/address information (or none at all) on any exchange. If Coinmama were to be a scam, many users’ delicate personal information (ID’s, addresses, selfies, bank accounts, etc.) would be compromised immediately. With that being said, Coinmama has been around since 2013 (6 years as of this writing), yet has only serviced over 1.8 million customers worldwide. Perhaps Coinmama isn’t as popular as other brokerage exchanges, but these are some thoughts that every potential customer should consider prior to opening an account. Every individual has the sole responsibility of performing the necessary research needed before making financial decisions. 

Conclusions For Coinmama

Coinmama provides a great option for anyone that may be curious and speculating on cryptocurrencies, as well as the crypto user that wishes to have a simple and straightforward method of purchasing and selling crypto. Though the platform fees can run high, users can be sure they will have a convenient experience.