Bitstamp Exchange | Honest Review 2018 | Read This First!
So you’re looking to start trading Bitcoin on one of Europe’s leading Bitcoin exchanges? Good idea. Bitstamp is one of the most established and respected exchanges on the market. But my research proved it might not be suitable for everyone. Bitstamp caters to a specific customer and if you are not this kind, you may end up paying much more than you should.
Read this honest review of Bitstamp.net for 2018 before trading. You’re about to learn everything you need to know.
Bitstamp is a European Bitcoin exchange founded in 2011 and currently based in Luxembourg. Founded in Slovenia, it was the first fully-regulated virtual currency exchange in the EU. It offers a simple buy/sell mechanism for purchasing BTC with credit cards and in-depth tools for trading.
It’s particularly popular with advanced volume traders from the European Union (we’ll cover this later).
Its growing share of the market, strong community sentiment, and tight security are proof that it has recovered from an alleged hack.
It is a powerhouse in the industry, especially now that it’s backed by blockchain venture capitalists. But it isn’t for everyone. Its cumbersome tools and bureaucratic red tape make it best for intermediate and advanced traders.
As a beginner myself, I’ve used the site and researched the web to bring you this honest review from my perspective.
"We believe bitcoin is here to stay. Our goal is to provide reliable, easy to use service for companies and individuals to exchange bitcoins."
— Nejc Kodrič, CEO
Bitstamp is regulated by the CSSF, Luxembourg’s financial regulatory body. 98% of funds are stored offline and they produce a yearly audit for regulatory body scrutiny.
Privacy is reduced for the sake of security. Bitstamp has high verification hurdles including personal details, identity document, and residency verification standards.
Ease of Use
Verification is difficult and the interface is a bit confusing. But buying/selling is easy and the dashboard is straightforward.
In-depth tools, a detailed interface, and lush markets make Bitstamp’s trading experience one of the best in the business.
Bitstamp’s support is highly respected by the community. They are generally very responsive and quick to resolve issues.
Bitstamp is a highly respected and active exchange, but it’s best left to advanced volume traders. Its volume fee system, heavy verification requirements, and base in the EU make it suitable for high-volume traders from the European Union, not beginners. It is not a good exchange to buy your first Bitcoin.
“Bitstamp – the backbone of the Bitcoin economy” - Forbes
Bitstamp was founded in Slovenia in 2011 by Damijan Merlak and Nejc Kodrič as a European-alternative to the Mt. Gox exchange in Japan. According to Kodrič, it was started with €1,000, 2 laptops, and 1 server.
Due to financial and regulatory difficulties in their native Slovenia, they moved operations to London. in 2016, it became the first fully-regulated EU Bitcoin exchange when the government of Luxembourg granted it a financial license. It is now headquartered in Luxembourg but maintains offices in Slovenia, the UK, and the USA.
The company trades in USD, but allows Single European Payments Area (SEPA) transfers.
In 2015, the company allegedly suffered a hack that resulted in the theft of ~19,000 BTC ($5 million at 2015 rates). However, the company has fully rehabilitated its image and doubled down on security efforts since then.
The site’s usability isn’t the most straightforward (except buying BTC) and verification is quite difficult due to regulation. Still, the exchange currently possess over 10% market share.
Traders love the security, stability, and high-liquidity of the site (20,000 BTC 24-hour volume as of 1-19-18). Detractors detest the lack of privacy and altcoins as well as the high credit card fees. Still, for purchasing Bitcoin, Litecoin, Ethereum, and Ripple*, and trading in high volumes, Bitstamp is a clear market leader.
* Ripple (XRP) - Ripple and the associated cryptocurrency (XRP) is a global settlements network. This means Ripple is a common currency underlying all international transfers. The transfers are instant and the fees are low. For more on this exciting payment method, read this step-by-step guide.
How Does Bitstamp Work?
Bitstamp is a cryptocurrency exchange. An exchange is a platform that facilitates the trading of fiat currency for Bitcoin (or other currencies) or vice versa. It matches a buyer with a seller and takes a fee for its troubles.
You can also purchase BTC directly from Bitstamp via credit card. This is in contrast to a peer-to-peer network like LocalBitcoins (which is like Craigslist) or a Bitcoin broker like Coinbase (like the currency exchange at an airport).
Is Bitstamp Safe?
In my research, I found that potential users were worried about security at Bitstamp. This is mainly due to the hack that it suffered in 2015. I can say with confidence that Bitstamp is now one of the most secure and heavily regulated exchanges in existence. In fact, it is so heavily regulated that many traders don’t like to trade there.
Bitstamp has always been on the cutting edge of security. It was one of the first companies to institute fully-insured cold storage.
The company is fully-regulated within the European Union, is regularly audited, and is serious about its internal self-regulating procedures.
Is Bitstamp safe? Yes. Here’s why:
What Are Bitstamp Fees for US/EU Users?
Bitstamp accepts a wide range of deposit options and works on a volume-tiered fee schedule. The more you trade, the less you pay. In general, fees are low, but they are a bit higher than competitors. Community sentiment agrees that Bitstamp is good for EU and high-volume traders, but a bit expensive for others.
The fees are as follows:
Extremely cheap fiat deposits within the EU make Bitstamp advantageous for EU traders.
Bitstamp International Wire
Bitstamp Trading Fees
Bitstamp works on a volume-tiered trading fee schedule. For 30-day volumes under $20,000, the fee is slightly high (.25%). If you’re trading over $20,000,000 (who isn’t these days?), it’s pretty low (.1%). Here’s the full chart:
For a full explanation of Bitstamp’s fees, see their fee page.
Bitstamp Fee to Compared to Competitors
Bitstamp’s fees are generally considered a bit on the high side. It’s the price you pay for security and stability. Here’s how it stacks up against competition.
What Are Bitstamp’s Trading, Deposit, and Withdrawal Limits for Verified Users?
Bitstamp is rare in that it does not impose any hard limits on its verified users. Once your account is verified (find out how to do this next!), you won’t be subject to monthly limits. However, support will regularly request information and ask you for details, especially when limits begin to surpass $10,000.
You may begin to experience delays or have to answer certain questions. For example, one user claimed the exchange asked where he got his Bitcoins from, if he was affiliated with any other exchanges, and if he was using any of his coins for gambling.
Unverified users are not allowed to use the platform.
Note - January 19th, 2018: As of now, there are reports across social media and forums of verification, withdrawals, and deposits taking much longer than expected.
The company warns of possible delays via a banner on the website.
How to Purchase Bitcoins from the EU/USA With Bitstamp
Bitstamp represents one of the most convenient ways for American or EU customers to get their hands on some cold hard BTC. For EU and US customers, there are two main options: Bank Account or Credit Card. Credit card is available to all EU, UK, and USA customers. For EU customers, SEPA transfers are fast and cheap. For American customers, there’s international bank wire. As of January, 2018, deposit times are unreliable.
Buying is pretty easy, but you’ll need to get verified first. If that isn’t something you’re willing to deal with, consider a different exchange.
Step 1) Register and Get Your Username and Password
Go to Bitstamp.net and click Register in the top right.
Now go back to Bitstamp and log in with your credentials. You will be prompted to change your password immediately. Be sure to set a VERY strong password.
Step 2) Verify Your Account
Bitstamp Verification Requirements
Bitstamp is heavily regulated and compliant with Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures. To keep up with these high financial industry standards, the company wants to know it’s really you hiding behind that account.
Verify your ID document. Pay special attention to the requirements. Your document WILL NOT PASS VERIFICATION IF YOU DON’T FOLLOW THESE RULES. This Reddit thread spells out the issues plainly. User Domerocked7 (where do people come up with these names?) says:
“Waited 8 days to be verified, they finally responded saying they didn't like the color scanned photo of my ID that I submitted. Now I'm assuming I have to wait another 7-8 days?!”.
January 20th, 2018: In these exciting times for Bitcoin, Bitstamp (like competitors) is suffering major overload. Trading volume at Bitstamp increased a mind-boggling 1,384% in 2017! Bitstamp is facing delays across the board. Here is their official statement. Don’t be surprised to see delays of a few weeks or more.
Step 3) Deposit Funds
Step 4) Choose Your Deposit Method
Step 5) Buy Bitcoins
Buying Bitcoins is actually the easiest part of the entire process. Go to the trading section and select instant buy. This will automatically buy Bitcoin for the lowest price on the market. You should set a limit order. This will set a limit on the price at which you are willing to buy Bitcoin.
Bitstamp Reviews: Is Bitstamp Safe? Is it a Scam? Is It the Best and Cheapest Exchange?
Despite a hack in 2015, Bitstamp has maintained a solid reputation in the community. It is one of the most respected exchanges on the market. Community sentiment and trust is strong; however, customers are growing restless with delays as of early 2018. That doesn’t change the fact that, unlike many competitors, Bitstamp is almost universally liked.
Support certainly has its issues, but they are quite active on Reddit. You can open a ticket and most issues get resolved quickly.
“Bitstamp is a Big Four digital asset exchange that has earned the trust of the global blockchain community”
Positive reviews focused on good customer support, fast deposits, a simple interface, and ease of buying. Negative reviews, interestingly enough, focused on bad customer support, slow deposits, and difficulties trading. It seems like the experience you have is highly dependent on if customer support reaches you. Check out this thread from a review website:
Good Reviews Say:
Bad Reviews Say:
Verdict: Bitstamp is a reputable and secure exchange with high community trust. Overall, the experience is good and support attends to you. If you are waiting, open a ticket and go to Reddit for help. One forum user aptly sums up Bitstamp in this comment:
“Bitstamp is perfectly fine. So many bad reviews here are just complaints about how they can't get an account now that the entire world is trying to trade crypto. I've been with bitstamp for almost 4 years and I've had zero problems. If you're not an idiot and able to fill out forms correctly, bitstamp works perfectly well.”
Top 3 Bitstamp Alternatives for US Customers
Bitstamp is a great exchange, but there’s no doubt it’s geared toward EU customers. Fast SEPA transfers make it the exchange of choice for Europeans. Also, verification is a major headache. If you’re an American customer seeking better deposit options or more privacy, here are the top 3 Bitstamp alternatives.
LocalBitcoins is what’s known as a peer-to-peer (P2P) exchange. Some call it the eBay of Bitcoins. It’s far less secure than Bitstamp, but it offers unmatched privacy. Everything is 100% anonymous and setting up an account takes no time at all. Sign up, choose your seller, and pay with a myriad of options anonymously!
Coinbase is the web’s leading Bitcoin exchange. Over $20 billion dollars worth of crypto has been traded here. For the first-time buyer wanting to buy with a credit card, it is by far the best option. The credit card fee is lower than Bitstamp (3.99%), and it’s much easier to navigate the website. Check out this in-depth review of Coinbase before buying from them.
Bittrex is one of the web’s leading exchanges. It offers a bevy of currencies to choose from and a wide range of deposit options. The best thing about Bittrex is the range of altcoins available for trading. It’s just as heavily regulated at Bitstamp though, so expect verification hurdles as well.
Bitcoin Exchange Comparison: Coinbase Vs. Bitstamp - Which is Better?
Coinbase and Bitstamp are two of the most trusted names on the market. When it comes to buying Bitcoin with a credit card, these two names inevitably butt heads. Both are heavily regulated, secure, and fast; however, they serve two completely different purposes.
Let’s look at the difference between the two.
Here are some of the advantages of using Coinbase:
Verdict: Coinbase for beginners and US customers. Bitstamp for EU customers. Note: this is for buying Bitcoin, not trading.
Coinbase is a broker that only sells BTC. However, you can use GDAX to trade crypto. Bitstamp’s interface is simple enough, but can be extremely intimidating for new users. Verification hurdles are a headache regardless of where you reside, so no way of escaping that. In general, Coinbase offers the fastest and most secure way to get Bitcoin for new users. However, the ease of SEPA transfers for EU residents is too hard to ignore. So, in my opinion, if you’re in the EU, just use Bitstamp. If you’re in the US, Coinbase.
I’ve trolled the web for information. I’ve peered into the deepest, darkest reaches of the internet. I’ve even visited Bitstamp. The result is this awesome FAQ to answer your queries.
Don’t trade on Bitstamp until you’ve read these.
Q: Is Bitstamp Safe?
A: Yes. Bitstamp is one of the most highly regarded exchanges. It is fully licensed and regulated. Heavy verification requirements and consistent government auditing make it one of the safest places to trade hands down.
Q: Does Bitstamp Accept Credit Card?
A: Yes, you can buy Bitcoin with a Credit Card from Bitstamp. The fee is 5%.
Q: Is Bitstamp Also a Wallet?
A: Yes. You can store your BTC on the site. However, this is not recommend. Any time your private keys are held elsewhere, you put yourself at risk. Keep only what’s necessary for trading in your wallet. Move your BTC into a wallet that you control. Think of it like carrying cash—you wouldn’t keep your life’s savings in your back pocket, would you? Keep cash on hand for what you need, and keep the rest in your bank account.
Q: Does Bitstamp Work in the US?
A: Until May of 2017, Bitstamp did not allow American customers to use a credit card. Now, US customers are allowed to use a credit card to purchase coins.
Q: How Long Does a Deposit Take?
A: According to support, SEPA transfers should take up to 24 hours. Sometimes up to 3 days. International wire transfers could take up to 5 days.
Q: How Long Does Bitstamp Verification Take?
A: Support claims that verification usually take 3 business days; however, as of January, 2018, these times vary.
If you are having any issues with Bitstamp, open a ticket with customer support.
What Cryptopositive Likes/Dislikes
Bitstamp has a lot to offer, but its flaws are hard to ignore. But I want to judge Bitstamp for everything it is rather than what it’s not.
It advertises itself as one of the most secure, reliable, and liquid ways to trade Bitcoin, Litecoin, Ripple, and Ethereum—it delivers. It is not one of the more comprehensive exchanges, though. Still, compared to many other exchanges, Bitstamp has some seriously attractive qualities.
Hey, if everything were perfect, life would be boring!
Bitstamp is one of the market’s largest, most trusted, and most reputable exchanges. It’s high security, in-depth trading tools, simplified buying process, and stability make it one of the most secure trading platforms. But you pay for what you get.
If you want to use Bitstamp, you will have to provide some serious verification. On top of that, you’ll pay slightly higher fees. You also can only trade in Bitcoin, Litecoin, Ethereum, Ripple, and Bitcoin Cash as well as USD and EUR.
If you want fast, secure, and stable trading markets, Bitstamp is one of the best to start trading on. Just be warned that its verification hurdles and in-depth interface mean it is not user friendly.
Verdict: Bitstamp is great for serious traders, especially from the EU. In order for it to be worth the hassle, you need serious trading volume. If you want more privacy, try LocalBitcoins. If you want a wider range of coins, try Bittrex or Poloniex.