LITEBIT REVIEW: BEST CRYPTOCURRENCY EXCHANGE FOR NEW TRADERS?
If you’ve never traded cryptocurrencies before, it is natural to be a little skeptical about the various options available to you.
LiteBit has been a recognized broker in the cryptocurrency industry since its inception.
But just because it has been operating for longer does not mean it is the best broker around. As a trader, albeit a new one, you must ask yourself:
What makes LiteBit better than the competition? Are the fees lower? Is the interface more feature-loaded? Is the security impressive?
In this LiteBit review, we answer all of these questions to help you understand if LIteBit is worth signing up for.
WHAT IS LITEBIT? – BACKGROUND
While LiteBit may not be the most popular of crypto exchanges, it is one of the oldest in the industry. The company was founded in 2013 by two crypto enthusiasts in The Netherlands – the two founders aimed to make investing in cryptocurrencies easier for the layman.
Only Litecoin was listed on the website initially, and later, Bitcoin was made available for trading. Currently, LiteBit enables users to trade over 50 cryptocurrencies.
The company’s growth was slow – it wasn’t till 2017 till its userbase grew to a respectable size, and by the end of the year, the company had a new and impressive website. Litebit was noticed by investors, and post a round of investments, it flourished.
The company outgrew its old headquarters, and with 14 employees handling operations, LiteBit moved to a new HQ in Rotterdam.
Since then, LiteBit has hired more and welcomed hundreds of thousands of users. The team is 50 strong, and LiteBit is currently one of the best-known cryptocurrency brokers in Europe.
LiteBit won the ‘Best Crypto Broker’ award for two years a row (2019 and 2020).
Who it is for
LiteBit is one of the few trusted brokers that offers over 50 different cryptocurrencies – if you’re looking to invest in a lesser-known altcoin, there is a good chance you will find it on the platform.
Paying for these currencies is easy. LiteBit supports several payment methods, and you’re not limited to making a crypto wallet-to-wallet transfer to pay for your cryptocurrency.
The company offers excellent customer support – you can instantly chat with the customer support team using the live chat feature.
Another advantage with LiteBit is that every user gets a secure wallet to store their funds. The EU is known for its strict rules when it comes to data security and privacy, and since LiteBit is headquartered in Rotterdam, you don’t have to be concerned about the company’s legitimacy.
The interface is easy to use, and while it doesn’t have many features, it offers just enough features for an inexperienced trader to make successful trades. LiteBit is not right for a seasoned trader.
However, you must note that if you’re from the U.S., you cannot use the platform. You will need to find an alternative.
LITEBIT: REGULATION AND SAFETY
LiteBit offers over four dozen different cryptocurrencies and has a daily trading volume of over $15 million.
The company understands the stakes and also realizes that security plays a big role in its reputation.
However, compared to other exchanges, LiteBit’s security measures seem lackluster. The platform has been hacked on several occasions, and while no customer funds were lost, the slip-ups have left a dent in its reputation.
The official website does not reveal much about the company’s security measures to keep user data and funds.
We don’t even know if the company uses cold wallets to keep funds secure like most other exchanges do.
LiteBit allows its users to enable two-factor authentication (2FA), adding another layer of security to each account. Furthermore, every user gets access to an e-wallet, and user funds can be transferred to an external wallet.
No further information about the security measures taken by LiteBit is available on their website, which indicates a lack of transparency.
Hacking attempts and security slip-ups
Several exchanges have been hacked once, and only a handful have never been hacked.
But LiteBit is one of the only exchanges that have been hacked more than once. In 2017, in about a month, LiteBit was hacked twice.
The first attack happened on 5th August, and while the company reported suspicious activity on its servers, it is unclear whether the hackers got hold of any data.
On 12th September, the company was attacked again, and it was revealed that the hackers got access to customer emails, hashed passwords, bank account numbers, and even addresses.
While the fallout was devastating for the company’s reputation, no customer funds were stolen.
LiteBit hasn’t been hacked since; however, these incidents reveal that LiteBit couldn’t get their guard up even after the first hack. There is no guarantee that their website is safe, and since the company does not have any insurance, many customers find using the portal to buy crypto risky.
If you always move your funds to your external crypto wallet, though, you have nothing to worry about.
It’s no secret that cryptocurrencies have been used to facilitate illicit activities – the most well-known of which remains to be money laundering.
While regulatory authorities have appeared in most countries to ensure that the technology is harnessed for good, there still are exchanges and brokers that do not comply with regulations.
LiteBit is officially registered with The Dutch Central Bank (De Nederlandse Bank), and as far as legitimacy goes, you don’t have anything to worry about.
However, the company does not operate in the United States, and hence evades approval from favored regulatory authorities.
Consequently, it does not have the New York Virtual Currency License (BitLicense), which is considered by many as the gold-standard of regulatory approval.
LiteBit could undoubtedly do better at highlighting the security measures taken. The company hasn’t announced that it will be seeking regulatory approval any time soon, so if you’re a seasoned trader or are looking to invest a lot of money into crypto, there are safer alternatives that you can trade with.
One of the things that caught us off guard when reviewing LiteBit is that it isn’t an anonymous exchange. To use the platform, you need to complete several checks and get your account verified.
In 2020, The Netherlands introduced new laws requiring brokers to verify all users’ identities, and the company complies with the law to continue operations.
You must submit verifying the following details if you want to trade with LiteBit:
- Address proof
- State-issued ID proof
- Bank account documents
- Documents proving the date of birth and nationality
While most of the verification process is automatic, at least one staff member will check your documents manually after you upload the documents.
Most times, verification is complete in 24 hours. However, if the company receives an excessive amount of verification requests when you apply, it may take longer for your account to get verified.
Like most other brokers, LiteBit charges a fee every time you purchase crypto. It is important to note that the fees aren’t fixed and differ from currency to currency.
If you’re buying Bitcoin, Ethereum, or Ripple, you will need to pay ≈1% of your purchase value. Binance, one of the best-known crypto exchanges, charges a 1% fee – you don’t have to be worried about overpaying when trading with LiteBit.
However, if you want to buy altcoins, the fees range between two and five percent.
Some platforms offer a cheaper rate for buying altcoins, and if you intend to trade altcoins, you could save a lot of money picking an alternative.
LiteBit charges higher fees because most altcoins only allow trading with BTC.
But it’s not all bad. LiteBit makes up for the higher fees by offering a wide array of payment options. You can pay with Giropay, MyBank, SOFORT, iDEAL, and Bancontact.
You can also pay using debit cards and do a bank transfer. If you trade often, you can buy LiteBit credits and pay with those.
However, credit card payments are not allowed on LiteBit, which is seen as a massive disadvantage by some traders.
LiteBit limits and liquidation
While you can use LiteBit without verifying your account, you will need to deal with the lower transaction limits.
An unverified user can only transact 75 Euros worth of crypto daily. The weekly limit for unverified users is 225 Euros, and you will only be able to transact a maximum of 2100 Euros every month.
If you get your account verified, you will be put in one of three tiers. In the first tier, you have a daily limit of 350 Euros. The weekly and monthly limits are 1050 Euros and 4200 Euros, respectively.
Tier two users can transact 500 Euros daily and have a weekly and monthly limit of 3,500 and 14,000 Euros.
If you upgrade to a tier-three account, you can transact over 35,000 Euros every day. For these account holders, the weekly and monthly limits are raised to 245,000 Euros and 500,000 Euros, respectively.
The company shares some of your data with third-parties for hosting, marketing, and payment services.
- Your account can only be accessed if the right username and password are entered.
- LiteBit takes physical measures to ensure that the servers with your data on them remain inaccessible.
- All the communication between you and the website is encrypted with Transport Link Security.
- The company logs every request for access to personal data.
- Multi-factor authentication is employed wherever applicable.
- The company only hosts with providers that take special care in handling sensitive data.
- LiteBit employees receive special security training to ensure the upkeep of company security.
TEST OF THE LITEBIT TRADING PLATFORM
LiteBit has a comparatively simpler trading interface that you can access by visiting the “Buy” section via the main menu on the site.
There are no charts and trading statistics to help you make an informed trading decision. If you’re an experienced trader, this isn’t the right platform for you.
But if you’re a beginner, you can use features like the cryptocurrency price alert feature to get your crypto at the price you want to. If you enable the feature, when your cryptocurrency of choice rises or comes down to the specified price, you will receive an email.
The lack of charting and analysis tools makes it lackluster, and if you’ve looking to do anything other than simply purchasing and selling of cryptocurrencies, LiteBit isn’t right for you.
One advantage with LiteBit is that you can buy and sell crypto when you’re on the move using the mobile app. The LiteBit trading app is available on the Google Play Store and the Apple App Store.
HOW TO TRADE WITH LITEBIT?
You can buy crypto with LiteBit quickly. There is no need to deposit credit into your account first since you can convert euros to crypto using local payment methods.
All you need to do is navigate to the “Buy” section in the menu, select the crypto you want and the amount you want to buy, and then pay for your purchase.
You can either have the crypto transferred to a private wallet or indicate that you want your crypto in your LiteBit wallet when you’re making the payment.
Regardless of where you have the crypto transferred, you will need to pay the transaction fees imposed by the company. It varies from 1% – 5% depending on the cryptocurrency.
If you want to sell your crypto, you must follow these steps:
- Navigate to your wallet and click “Sell.”
- Enter the amount of crypto you want to sell.
- After you specify all of the required details, you will receive the payout.
- The transaction can take up to one day to complete, but typically, the money is credited to your bank account within an hour.
The process of selling crypto from your wallet is entirely different. You must first create a sell order and then transfer the cryptocurrency to the wallet address you receive.
How to open an account with LiteBit?
Opening an account with LiteBit takes seconds. All you have to do is:
- Navigate to https://www.litebit.eu/en and click on “Get Started.”
- Enter your name, email, and set your password.
- Also, enter your country of residence and nationality.
- Verify your email address by clicking on the link in the email you receive.
- Verify your phone number by entering the code in the SMS.
- Enable two-factor authentication and choose your preferred method.
And that’s it; your LiteBit account is ready. However, you won’t be able to use all the features until you verify your account.
You can verify your account quickly as long as:
- You have your phone handy.
- You’re in a well-lit environment.
- You have your password or ID card with you.
Does LiteBit offer demo accounts?
Demo accounts are a trendy feature that enables traders to apply their strategies without investing real money. Think a sandbox trading platform that reflects real-time pricing and uses dummy-money so traders can learn how to think faster.
There are only a handful of companies that offer demo accounts, and unfortunately, LiteBit isn’t one of them.
Is there a Negative Balance Protection in LiteBit?
Negative balance protection can come in very handy and save you from falling into debt if the market begins to move rapidly against your trade.
The feature can be especially useful for new traders that aren’t familiar with how quickly the tables can turn during announcements and market openings.
If you’re in a losing protection, the feature ensures that you don’t end up with a negative balance in your account. If you’re losing money fast, a margin call will kick in and protects you from going into debt by closing the positions.
Unfortunately, LiteBit does not offer this feature either.
LITEBIT DEPOSITS AND WITHDRAWALS
LiteBit only allows you to send and receive the currencies that are listed on the platform. However, there is no information on the website or the help page about the deposit and withdrawal charges.
The lack of transparency is off-putting, and not knowing how much they will end up paying deters traders from using LiteBit.
But the nice thing about the platform is that you can pay using both crypto and fiat currencies using several methods except credit cards. It opens up crypto trading to complete beginners.
After you connect your bank account to the portal, you will be able to withdraw and deposit Euros in your account with ease.
How to deposit crypto
To deposit crypto into your LiteBit account:
- Navigate to the wallet section from the main menu.
- Select the currency you want to deposit.
- When depositing for the first time, generate a new address.
- Copy the address into your wallet.
- Enter the amount and complete the transaction.
After your first deposit on LiteBit, you may reuse the address you generated or create a new one. If you choose to generate a new address, the older address won’t be visible in the deposit menu, although it will remain valid.
How to withdraw crypto
In order to withdraw crypto, please follow these steps:
- Navigate to the wallet section from the main menu.
- Select the currency you want to withdraw.
- Click on the “Withdraw” button next to the currency you want to withdraw.
- Enter the address of the wallet you want to withdraw the currency to.
- Enter your two-factor authentication token when prompted.
No information about the company’s deposit and withdrawal fees is available, but since the company works on the broker model, we assume that the fees are set dynamically.
Support and service
One of the best things about LiteBit is the customer support. The website and the customer support is available in four languages: English, Dutch, French, and German.
This shows that the company is committed to serving its limited users well. The website is easy to navigate, and you will be able to find whatever feature you’re looking for without much trouble.
Customer support is available to all the customers over the phone between 9 am and 9 pm. You can reach out to a customer support executive by calling LiteBit at +31 (0) 10 310 41 75.
You can connect to the customer support team by starting an instant chat on their contact page.
Alternatively, you can also send them a support request at this link. You can expect a response in under 24 hours.
Accepted countries and forbidden countries
The broker only operates in the EU and isn’t available for use in the United States. If you’re in the U.S., you aren’t even allowed to register an account on LiteBit.
The company enables traders from Hong Kong, Singapore, Mexico, and dozens of other countries to trade cryptocurrencies.
You can find an updated list of the countries LiteBit supports on this page.
CONCLUSION OF THE LITEBIT REVIEW
At first blush, LiteBit seems like a convenient to use a broker that you can trust. It is quite popular, especially in the EU, making it seem that much more trustworthy.
While the company offers up many altcoins and supplies several payment methods, the fees it charges are notably higher than its competition.
Furthermore, LiteBit’s security has been compromised twice, leaving a dent in its reputation that will never be fixed.
There isn’t a lot of information about the security measures it takes, and the company also does not reveal the details of its pricing scheme on its website.
Is LiteBit usable? Yes.
But should you use it?
Several other brokers and exchanges charge significantly lower fees, offer better security, and offer a much richer interface.
We recommend relying on other companies to fulfill your crypto trading needs – there certainly isn’t a shortage of good options.