Bitstamp review and test: How good is the cryptocurrency exchange?
(4.8 / 5)
20 coins +
Crypto, fiat deposit and withdrawals
One of the things both new and experienced crypto traders look for in the exchange they use is reliability. Knowing that an exchange is safe to use, and everything that happens on it is regulated gives you the peace of mind you need to make the right trades.
Bitstamp is based in Europe and is one of the oldest cryptocurrency exchanges in the industry. But what features does it offer? Does the fee structure make sense? And more importantly, does it offer the reliability a crypto trader is looking for? This in-depth Bitstamp review will help answer those questions and many more.
What is Bitstamp? – Introduction for investors
Bitcoin was created in 2009, and it didn’t take long for the cryptocurrency to gain popularity. Exchanges soon popped up, and in 2011, two friends in Slovenia decided to start Bitstamp. Nejc Kodric and Damijan Merlak created the exchange to compete against Mt. Gox, which was arguably the most popular crypto exchange at the time.
While Mt. Gox was easy to use and had become the go-to crypto exchange for many, it had security issues, which led to its eventual downfall. The platform was hacked in 2011, and by 2014, it went bankrupt.
The blockchain is one of the most secure technologies out there, the exchanges that work on the technology aren’t always secure. The importance of security was evident to the founders of Bitstamp, and they understood that traders would only use an exchange they knew they could trust.
So, in 2013, the founders decided to move the company’s operations to London to position their firm in the center of European banking. But unfortunately, the UK didn’t have any regulations in place that would guide the sale of crypto.
And then something clicked for the founders.
They realized that the lack of regulation is why so many customers stray away from trading cryptocurrencies in the first place. All they needed to do to make Bitstamp more reliable is a move to a country that regulates cryptocurrencies. Taking advice from David Marcus, the former president of PayPal, the founders decided to shift operations to Luxembourg. In early 2016, they held meetings with the country’s government, and by April in the same year, Bitstamp was the world’s first nationally licensed cryptocurrency exchange.
The licensing enabled the company to operate in all of the EU, increasing the potential size of its userbase. Getting licensed was a big win for the company.
Bitstamp has since continued to bank on their strategy, and have partnered with several financial institutions worldwide. Partnering with the likes of Swissquote and the Chicago Mercantile Exchange, among others, has made Bitstamp one of the most reliable crypto exchanges in the industry.
(Risk Warning: Your capital can be at risk)
Bitstamp – Who it is for:
Bitstamp focuses on quality over quantity. While you may not find an endless variety of crypto or advanced order types, the services the company does offer work great and are convenient to avail. Bitstamp only allows you to place market orders, limit orders, stop orders, and instant orders. You can place these orders using the simple homepage interface or using Tradeview, the company’s advanced interface.
Ease of trading:
- Intuitive interface
- Instant deposit options
- Cash-out directly to your bank account
- 98% of assets are stored safely offline
- Highly encrypted personal data
- Whitelisting and transaction confirmations
- Exchange bitcoin since 2011
- 24/7 dedicated support
- Industry-leading uptime
Tradeview provides access to several analytical tools and supplies some powerful order types, making it easier for you to execute your strategy. You can also use the mobile app to execute your trades. It comes with all of the functionality that the desktop version of Bitstamp does, which is a big plus.
In addition to placing and managing your orders, you can check the charts, withdraw and deposit funds, and send and receive cryptocurrencies. The app gives you access to Tradeview, allowing you to use its vast range of analytical tools to make good trades when you’re on the move.
The secure mobile wallet makes trading on the go that much more convenient. The Bitstamp app is available for both Android and iOS.
Real-time data streams are available 24/7 thanks to the FIX, HTTP, and WebSocket APIs. What makes it more impressive is that the company’s APIs have been rated the fastest and most stable by both institutions and individual traders in many instances. The exchange is powered by a Nasdaq matching engine, guaranteeing optimal trading speed and reliability.
Bitstamp is both feature-rich and convenient to use, making it apt for use by new and experienced crypto traders alike.
Bitstamp regulation and safety – How safe is the exchange?
As mentioned earlier, the company enables the trading of ten cryptocurrencies, including Bitcoin, Litecoin, and Ether, and has 42 trading pairs. Bitstamp is the seventh-largest cryptocurrency exchange by trading volume and accounts for 2% of all crypto trading globally. Bitstamp hasn’t just stood the test of time – it has managed to thrive in the industry.
However, the exchange has been hacked into twice. While this may seem like a dealbreaker, it is important to note that no customer funds were lost, and Bitstamp maintained full transparency during both events. Here are some more details about the two hacks:
Bitstamp Hacks 2014 and 2015
The 2015 Bitstamp hack caused a lot more damage than the hack of 2014. The hackers managed to steal 19,000 Bitcoins from the exchange, making it one of the biggest crypto exchange hacks to date.
But, as you can tell, the company hasn’t gone bankrupt and is still trusted by top traders. This is because none of the customers lost their money. The company also reported that the hack resulted from a successful phishing attempt rather than an internal security failure.
The company had shut down operations after the hack briefly to recuperate. The security measures taken by Bitstamp have proven effective – the exchange hasn’t been hacked in six years now.
Bitstamp takes some impressive security measures to keep its user’s data and funds safe.
98% of the company’s crypto assets are air-gapped, or in other words, stored offline where no one can access them. Since the coins are inaccessible, there’s no chance of them getting stolen. The coins are only ever brought out of cold storage if customers require access to more coins in their “Hot Wallet.”
Hot wallets are internet-connected wallets that enable users to trade and make transactions. Since Bitstamp only gives customers access to multi-sig wallets, there is no reason for you to worry about your wallet’s security. A transaction from these wallets only goes through if multiple keys sign it. For this to happen, the transaction must be approved by at least a handful of staff at Bitstamp.
The implementation of multi-sig wallets protects the company from becoming victim to phishing attempts. Obtaining all the staff’s keys only to approve a transaction is impossible for hackers to do. On top of all this, all of the funds that Bitstamp holds is secured by BitGo’s insurance. Even if hackers were to bypass heavy security somehow, the funds would be replaced.
Now that you know how the company secures its funds, it is obvious for you to ask how the company protects its users. Bitstamp has several measures in place to decrease the risk of user accounts being hacked.
The most useful of which is two-factor authentication. Using 2FA to secure online accounts has become common since it serves as an effective security measure.
However, it is not enabled by default on Bitstamp, and we advise you to enable it as soon as you create your account. But one feature enabled by default is email confirmation. Every time you send out funds from your wallet, you will need to confirm the transaction from the email you receive.
While Bitstamp does an excellent job of keeping your funds secure, it is best practice to avoid storing many coins on the exchange. Putting your funds in a private wallet when not in use is the right way to go.
The company’s website uses AES 256-bit encryption to make your connection to their servers secure. The green padlock on your browser will help you confirm this every time you visit Bitstamp.
Additionally, during the verification process, your documents are secured using PGP encryption. Even if the hackers manage to access the server with your data on it, your information will be safe since it is encrypted. These are some of the many features that make Bitstamp one of the industry’s most secure exchanges.
As mentioned earlier, the company relies on regulatory compliance to make customers feel at ease. Besides having all the licenses required to operate all across the US and EU, Bitstamp also possesses the famed BitLicense, enabling traders in New York to trade crypto.
On top of that, the 2018 Virtual Markets Integrity Initiative Report produced by the New York Attorney General’s Office confirmed that Bitstamp had the approval to operate in New York. Approval at this level indicates that the company agrees to actively protect customer’s funds and prevent illegal activity on its platform. Bitstamp is one of the few companies that block access to their website when accessed over VPNs, ensuring that every user only accesses the features made
Trading conditions – What can the exchange offer?
To trade using Bitstamp, you must:
- Prove that you are at least 18 years of age
- Upload a valid identity document like a driver’s license
- Upload a document to prove residency, such as a utility bill
Your account will remain blocked from using the exchange until your details have been verified. Also, during the verification process, you will not be allowed to terminate your account or request the deletion of your data.
Bitstamp complies with KYC and international AML regulations – while opening an account is easy, you must go through the verification process before using the platform.
The verification process typically takes a few days to complete. In 2017, Bitstamp saw a massive surge in verification requests, and over 100,000 accounts were being made daily. It took some users months to get verified. But the good news is, the company has sped up its verification process, and if you were to sign up to Bitstamp today, your account would be verified in a few hours.
Bitstamp fees and conditions:
The trading fees for all pairs are as follows:
30-day trading volume:
The tiers are based on trading volume over the past 30 days up to this moment. You’re moved to the next tier a few minutes after you meet the requirements. To learn more details and fee options, you can email Bitstamp at [email protected].
Bitstamp limits and liquidation
Most other crypto exchanges allow users to begin using the platform right after they sign up. New users can trade all they like, but their withdrawals will be limited to 2 BTC a day. Only after the user has verified their account will they be able to withdraw more crypto in a day – the limit is usually raised to 100 BTC.
However, Bitstamp isn’t like the other exchanges. You cannot use the platform until your account is verified. There are no account levels, either, and you will need to wait until your account is enabled. Once your account is verified, though, there are no withdrawal limits whatsoever. This characteristic makes Bitstamp an excellent choice for those that trade in high volumes.
- Unverified users can withdrawal a maximum of 2 BTC per day
- Verified users can withdrawal a maximum of 100 BTC per day
- Verified users have no withdrawal limits
(Risk Warning: Your capital can be at risk)
Test of the Bitstamp trading platform
One of the many things that attract experienced crypto traders to Bitstamp is the interface. In the picture below you will see the Bitstamp trading platform:
Switching between trading pairs is as simple as navigating the dropdown menu on the top-left. In the center of Bitstamp’s “Tradeview” interface, you will find the trading chart, where candlesticks represent price changes.
The order book on the bottom right shows you all the currently open buying and selling limit orders. There’s a depth chart right next to the order book, giving a visual representation of the order book.
The Trades column on the left displays all the recently executed trades, and the New Order column on the right is what enables you to make trades. Adjusting the chart to make the most of the exchange is made uncomplicated and straightforward.
You can change the time interval and switch the default candlestick representation for hollow candles, bars, baseline, area, and many more. The indicators menu on the top left of the trading chart gives you access to several indicators, enabling you to make smarter decisions. You can search the list of indicators and activate them with a single mouse click.
Changing the length, source, and offset of indicators is also easy and allows you to get a more in-depth look at the currency’s patterns at a glance. The panel on the left of the chart gives you access to different mouse pointer options, line drawing tools, over a dozen charting tools such as fib retracements, brushes, text notes, patterns, and much more.
How to trade with Bitstamp?
You don’t always have to use the Tradeview interface to place orders using Bitstamp. You can place an order using the Buy/Sell option on the homepage.
To make your first trade with Bitstamp:
- Log into your account with your username and password, and then enter the six-digit authentication code that you’ll receive on your phone.
- Navigate to the upper-right corner of the homepage, and select the trading pair you want.
- Click on the Buy/Sell button on the top-right corner of the screen.
- Choose the type of order you want to place – your options include Limit Order, Market Order, Stop Order, and Credit Card Purchase. You can also just stick with the default Instant Order option.
- Enter the amount you want to spend, or if you want to, you can choose to buy a portion of the cryptocurrency of your choice.
- Click the “Buy” button.
To check whether the order is completed, click on the “Account” button that’s right next to the Buy/Sell button. You will see that your balance has been updated.
How to open an account with Bitstamp?
To create a personal Bitstamp account:
- Visit bitstamp.net and begin the onboarding process. Alternatively, click here, and choose “Personal account.”
- Enter your name, phone number, and set your username and password.
- Choose the “Personal account verification” option to begin the verification process.
- Fill out the form and upload the requested documents. You will need to upload a picture of a valid ID and also a document to prove residency.
- Wait for your account to be verified. After approval, you will need to fill out the KYC form to ensure that your deposits and withdrawals go through quickly.
And that’s it after you fill out the KYC form, you’ll be able to use Bitstamp restriction-free. You will receive an email when your account has been verified and is ready to use.
Bitstamp shares the data it collects from you with some third-parties in order to prevent fraud and other financial crimes.
However, utmost care is taken to ensure that the data collected remains confidential.
The company takes several steps in this direction:
- The directories and databases are secured with passwords.
- Secure Sockets Layered technology is employed to make sure your data is encrypted before it’s sent across the internet.
- PCI Scanning is carried out to protect Bitstamp servers from hackers and malware.
All of the information you send Bitstamp for verification is only made accessible to authorized personnel. The data is treated as highly confidential, and the security measures in place are regularly reviewed.
The company never asks you for your financial information, like your bank account number of your credit card details over email or text. As long you ignore any suspicious requests, your funds will be safe.
The company requests its customers to report emails, texts, and calls enquiring about your financial information on behalf of Binance to one of their Service representatives.
(Risk Warning: Your capital can be at risk)
Does Bitstamp offer demo accounts?
Demo accounts are an invaluable tool for new traders. These accounts enable traders to test out trading strategies without needing to invest a single penny. While a handful of exchanges offer this feature, Bitstamp isn’t one of them. However, you can buy $25 worth of crypto with Bitstamp and play with it to gain real-world experience.
Is there a Negative Balance Protection in Bitstamp?
Bitstamp does not offer negative balance protection to its customers.
Bitstamp deposits and withdrawals
Deposits on Bitstamp are free regardless of if you use SEPA, ACH, or are making a cryptocurrency deposit. However, international deposits have a fee of 0.05%, and if you wish to make a card purchase, you must pay a 5% instant service fee.
While ACH withdrawals are free, SEPA withdrawals incur a fee of 3 EUR, and international withdrawals attract a 0.1% fee.
The company is quite competitive when it comes to pricing; however, it’s important to note that they keep updating their fee schedule from time to time. You can look at the latest fee schedule here.
Methods offered by Bitstamp:
- Credit cards
- Debit cards
- Bank transfer
- Multiple cryptocurrencies
Support and service
Bitstamp has an extensive FAQ page where you can search for solutions to any problem you come across. You can reach out to the company’s global customer support team via telephone and email, and you can also tag them on social media to get support.
If you’re a high-volume trader, you will get access to a dedicated account manager who will help you if you ever run into an issue. Customers report that while telephone support is great, getting a response from the company when contacting them via email takes a few hours. While support isn’t bad, it could be better.
- Account managers for high volume traders
- Fast ticket and email support
Accepted countries and forbidden countries
Bitstamp is available in all member states of the EU and the US and is also available in most other major crypto markets.
UK, Switzerland, Hong Kong, China, Singapore, and over two dozen other countries are supported. You can check if your country is supported on their FAQ page or by clicking here.
Conclusion of the Bitstamp review: Easy to use cryptocurrency exchange
Bitstamp has several security measures in place, complies with all regulations, and supplies an interface that both new and expert crypto traders can take advantage of.
The competitive fees and excellent customer support make Bitstamp an exchange any trader can rely on, without hesitating. This exchange is good for beginners and even professional traders. It has a user-friendly interface and also mobile trading is available. You will get access to the markets 24/7. We can recommend this cryptocurrency exchange:
Advantages of Bitstamp:
- High-security measures
- User-friendly trading platform
- Mobile trading possible
- Competitive fees
- Fast support
- Fast verification
- Buy crypto with fiat very easily
Bitstamp is an exchange suitable for beginners and experienced traders. It has competitive trading conditions. (4.8 / 5)
(Risk Warning: Your capital can be at risk)