Cryptocurrency trading these days is unimaginable without cryptocurrency exchanges. These exchanges enable traders to access several cryptocurrencies in one place and carry out any type of trade they want. Often, cryptocurrency exchanges also provide staking opportunities and the option to pay for things with your crypto balance.
Cryptocurrency exchanges are a dime a dozen but finding one that you actually like can be difficult. There are so many options and so many factors that need to be taken into consideration that choosing a cryptocurrency exchange can seem more difficult than it actually is.
Considering the FTX debacle in 2022, many traders these days want a safe, reliable, and properly regulated exchange. Bitstamp, which has been in the business for more than a decade, is one such exchange. In this review, you will learn about the way Bitstamp works, its trading fees and its security infrastructure which will help you decide whether it is the right place for you or not.
Bitstamp Overview
Bitstamp is one of the oldest centralized cryptocurrency exchanges in operation. It was founded in 2011 in Slovenia by Nejc Kodrič and Damijan Merlak. Later, it moved its registration to the UK and finally to Luxembourg in 2016. However, Bitstamp’s headquarters are still located in London.
After being licensed as a Payment Institution in Luxembourg in 2016, Bitstamp was allowed to do business across all European Union(EU) member states. Today, Bitstamp hosts 82 cryptocurrencies such as Bitcoin, Litecoin, Ether, Dogecoin, and several others.
Additionally, it also allows users to withdraw and deposit fiat currencies like the United States Dollar(USD), the Euro(EUR), and the Pound Sterling(GBP).
Cryptocurrencies Available
Bitstamp has 82 cryptocurrencies available for trading. Though limited in number, it does carry most of the popular cryptocurrencies such as:
- Bitcoin(BTC)
- Ether(ETH)
- Dogecoin(DOGE)
- Cardano(ADA)
- Solana(SOL)
- Polygon(MATIC)
- USD Coin(USDC)
- Tether(USDT)
- Litecoin(LTC)
- Shiba Inu(SHIB)
Bitstamp Fees
The fees at Bitstamp, at least for low-volume trades, are what we would call standard fees. They are not extraordinarily low but not the highest either.
Trading Fees
Bitstamp employs the widely used maker-taker model for determining trading fees. The highest rate is 0.30% maker fees and 0.40% taker fees for 30-day trading volume above $1,000 but less than $10,000. After that, the fees progressively keeps decreasing as the trading volume increases. The maker fee, in fact, becomes 0% for trades above $250,000,000.
Interestingly, no maker or taker fee is charged on low-volume trades of value less than $1,000.
Further, Bitstamp gives an 80% reduction on the maker-taker fees charged for FX/Stablecoin pairs. For example, for pairs such as USDC/EUR or USDC/USDT where the trade volume is greater than $1,000, you only have to pay a 0.060% maker fee and 0.080% taker fee.
Staking Fees
Bitstamp does not exactly charge fees for staking or unstaking assets. However, it takes a 15% commission from the total collected reward pool. It is only after taking the commission that the rewards are distributed among the individual customers.
Lending Fees
Again, Bitstamp does not directly charge fees on lending crypto assets but takes a certain percentage from the total rewards as commission. This commission differs from asset to asset. For instance, it is 27.27% for BTC while the same is 23.08% for ETH.
Deposit and Withdrawal Fee
There are no fees on Bitstamp for deposits though it does charge a withdrawal fee which differs from crypto to crypto. It is 0.0005 BTC for withdrawing Bitcoin and 0.006 ETH for withdrawing Ether.
Bitstamp Security Review
Bitstamp is a platform that has been built on the cornerstones of security, transparency, and regulation. As the first step towards building a reliable cryptocurrency exchange, it has obtained appropriate licenses in all the key territories where it operates.
Bitstamp is registered as a Money Service Business(MSB) in the US and Canada and has a Virtual Asset Service Provider(VASP) license in Italy, France, Luxembourg, Spain and the Netherlands. Apart from that, it has ISO 27001 certification and its SOC2 Type 2 attestation assures that its security controls adhere to the criteria set by the American Institute of Certified Public Accountants(AICPA).
Bitstamp holds customer assets on a 1:1 basis and this is assessed and validated by the exchange’s annual global financial statements which are audited by a Big Four global accounting firm.
Additionally, Bitstamp maintains strict segregation between customer and corporate assets, and 95% of these customer assets are kept offline in bank-grade Class III vaults. The user assets held in cold storage are also insured.
Apart from that, Bitstamp has mandatory KYC and AML requirements like pretty much all centralized exchanges. It is also a good idea to set up multi-factor authentication(MFA) and keep a unique password while signing up for an account on Bitstamp.
Bitstamp Pros
Well-Established Platform
Bitstamp is an old and well-established platform that has been operating for more than a decade. It has been around since 2011- a time when the crypto industry as a whole was in a nascent stage. Bitstamp has, therefore, proved its mettle in front of several crypto exchanges that came after it and collapsed unceremoniously after some time.
Competitive Fees
The trading fees at Bitstamp are fairly standard and competitive. It follows the simple maker-taker formula and there are no hidden charges. Further, there are no fees charged on trades with a 30-day trading volume below $1,000. The highest taker fee rate is 0.40% which keeps decreasing with increasing trading volume.
Easy to Use
Bitstamp is a straightforward exchange with a smooth interface. There is not much of a learning curve involved and you can easily navigate it even if you don’t have much experience with cryptocurrency trading. It is a good fit for beginners and casual crypto traders who just want to buy and sell cryptocurrency.
Mobile App
Bitstamp’s mobile app is highly rated on both Google Play and the iOS App Store. It has all the functionalities of the web version and enables crypto trading while on the go. There is also a Bitstamp Pro app available for more advanced traders.
Several Payment Options
Bitstamp supports debit and credit card transactions in nearly all the places where it operates. Even US users in most states can directly purchase crypto with their credit cards though it may require additional ID verification. Bank transfers are also supported on Bitstamp.
Additionally, US users can also use ACH for funding their accounts. Instant SEPA deposits are also available for some countries in the Eurozone such as Belgium, Germany, Lithuania and Finland etc.
Bitstamp Cons
No Margin Trading
Bitstamp does not support margin trading which is a common feature in most cryptocurrency exchanges these days. So, traders wanting to get into margin trading need to look elsewhere.
No Live Chat Option
Bitstamp customer service representatives can be contacted only via e-mail or the phone number mentioned on its website. There is neither a chatbot nor a live chat support option available here.
Slow Verification
KYC verification is mandatory on Bitstamp. However, the process for the same can be lengthy and tedious which combined with the amount of time taken to complete verification can be a frustrating experience for the customer.
Limited Staking Options
Bitstamp only has two assets- ETH2 and ALGO available for staking which is quite low compared to rival exchanges that have dozens of assets with high APYs available for staking. This, combined with the 15% service fee it takes from the total staking rewards makes Bitstamp an unattractive option for crypto staking.
Customer Support
Bitstamp has an extensive FAQ section with answers for every possible query. Apart from that, Bitstamp customer service can be contacted anytime at the email address mentioned on the website.
It is also one of the few cryptocurrency exchanges that have listed phone numbers on their website where you can directly talk to a customer service representative.
Customer Reviews
Bitstamp has a score of 2.3 out of 5 on Trustpilot with 692 reviews and is rated ‘Poor.’ Customers praise its ease of use and convenient mobile app. Negative reviews, however, point out the at times unhelpful customer service and problems faced while withdrawing funds.
Bitstamp is a simple and convenient exchange
Bitstamp is a trusted platform that performs well
Bitstamp’s customer service can be sometimes unhelpful
Customers have faced withdrawal problems on Bitstamp
Bitstamp Frequently Asked Questions(FAQs)
Is Bitstamp Legal?
Yes, Bitstamp is a duly licensed and regulated platform in several territories. It is registered as a Money Service Business(MSB) in Canada and USA and as a Virtual Asset Service Provider(VASP) in Italy, France, Spain, and the Netherlands, etc. Bitstamp is also ISO 27001 certified and SOC Type 2 attested.
Which Countries Accept Bitstamp?
Bitstamp is available in several countries globally including all EU member states. It is also available in the USA though certain services may not be in some states. Further, Bitstamp can be used in the UK, Switzerland, Norway, Serbia, Turkey, Taiwan, South Korea, Australia, Japan, and many other territories.
Does Bitstamp need KYC?
Yes, you need to get your KYC verified before trading on Bitstamp. KYC is necessary for verifying the customer’s identity and preventing financial crimes such as money laundering, fraud, and terrorism financing. The Financial Action Task Force(FATF) also issued the Travel Rule in 2019 to help member states coordinate efforts toward preventing money laundering via digital assets.
The Bottom Line
Bitstamp is an old and reliable exchange where you can safely buy and sell cryptocurrency at competitive rates. It is a simple and straightforward platform that is perfect for people that have just started getting into cryptocurrency. However, advanced traders may want to look elsewhere as Bitstamp’s limited cryptocurrency selection and features may not be enough for their needs.
However, Bitstamp is a good choice if you’re just looking to build a basic cryptocurrency portfolio. Either way, it is a good idea to get advice from a qualified professional before investing your money into cryptocurrency as they are highly volatile and speculative assets.