What is Bitstamp Exchange?

What is Bitstamp Exchange

Bitstamp Exchange is a cryptocurrency/digital asset exchange founded in August 2011 by Nejc Kodric and co-founder Damijan Merlak, with two laptops and $1000 EUR in a garage. Today it is a multimillion-dollar international, cryptocurrency exchange company with high-security features and follows international regulatory rules.  It is based in Luxembourg (small European country), but operates all over the world. It has offices in London, UK as well as in New York, USA. 

In October 2018 the Bitstamp Exchange was acquired by NXMH, a privately owned Belgium-based investment company for a rumoured $400 million. The founders have assured their users in a press release that Bitstamp will retain its name, mission, leadership and vision. 

Find the Bitstamp Twitter Account here. 

What is Bitstamp – Platform, Digital Assets and Fiat 

The Bitstamp Exchange offers a desktop/laptop platform as well as a mobile app platform to buy and sell cryptocurrencies. 

Bitstamp claims to have over 3 million traders on their platform. Their available cryptocurrencies are limited right now likely due to their tight following of regulatory movements in the US and Europe. 

What is Bitstamp Cryptocurrencies
Some of the cryptocurrencies offered by Bitstamp Exchange.
  • Bitcoin – BTC 
  • Ethereum – ETH 
  • XRP – XRP 
  • Litecoin – LTC 
  • Bitcoin Cash – BCH 
  • Fiat 
    • USD 
    • CAD
    • EUR
    • AUS
    • British Pound
    • Swiss Franc
    • Japanese Yen

What is Bitstamp Exchange – Regulation and Trustworthiness

In Bitstamp’s early days (2013 time-period) they functioned in the UK prior to relocating to Luxembourg and were told at the time that no regulation was needed since Bitcoin was not deemed a currency. However, they engaged in self-regulatory practices, collecting identifications of all users with two pieces of government-issued ID. In 2016, the Luxembourg government granted Bitstamp a license to be considered a fully regulated payment institution entity in the European Union, opening it up to the 28 member states. 

In the research published by Bitwise Asset Management that was presented to the SEC, Bitstamp stood out as one of the honest exchanges that did not fake Bitcoin trading volume. This immediately categorizes it as one of the more trustworthy cryptocurrency exchanges.  

Bitstamp has practiced good integrity and has a long track record of success and transparency. Because of this and its compliance with regulations, in 2017 the Chicago Mercantile Exchange created the Bitcoin Reference Rate (BRR), which is a once daily reference price of Bitcoin. This responsibility falls on the shoulders of: Bitstamp, GDAX, itBit and Kraken, all reputable cryptocurrency exchanges. 

At the time the same research report above was published, Bitstamp was regulated in America as an MSB. Although, recently Bitstamp received its BitLicense from New York State, making it regulated all over the USA. 

What is Bitstamp – Exchange Hack, and Remedy

Bitstamp is actually featured in my post on the Top 6 Cryptocurrency Exchange Hacks – having lost ~19,000 BTC back in 2015 after a hack occurred. The hack was due to employee error. There were relentless phishing attempts sent to the Bitstamp employee team, and eventually one of the employees “accidentally” succumbed to a phishing attempt. (Learn how to avoid cryptocurrency phishing attempts). 

Fortunately, the Bitstamp team had a back up of the exchange and were able to have it up and running again within weeks. They now have very tight security, storing the majority (98%) of their cryptocurrency offline in cold wallets and employ multisig wallets to prevent any individual hacker from accessing any hot or cold wallet. 

What is Bitstamp Exchange – Account and Trading 

The Bitstamp Exchange is compliant with all AML/KYC laws and has the option for you to set up a personal and/or corporate trading account. They have several account funding options available (SEPA, International Wire Transfer, or credit card). 

Once you begin trading they have various trading options including instant orders, limit orders, market orders, stop orders and trailing stop orders. 

What is Bitstamp – xRapid Partner

Additionally, the Bitstamp exchange is an xRapid partner with Ripple to facilitate XRP liquidity and exchange for international/global payments on the RippleNet. This news was announced at the end of 2018. 

It is highly speculated that because Bitstamp is an xRapid partner, and it also obtained its BitLicense (which is a strict, difficult to obtain license that is rarely issued in New York State) that this is unofficial approval/regulatory clarity that XRP is not a security, which has been the subject of debate for a while. 

Markshire Crypto Conclusion – What is Bitstamp Exchange

Overall, the Bitstamp Exchange is a high-quality compliant cryptocurrency exchange that is working at a good pace to advance their platform, and cryptocurrency adoption, all while staying within existing regulatory frameworks. 

I have read and heard many good things about the Bitstamp Exchange. Despite their hack issue back in 2015, they have since been able to recover from the incident. Given that cryptocurrency hacks are numerous and in early days without sufficient technology and experience for consumer protection, it is forgivable. However, it is only forgivable because they remedied the situation quickly and only improved their service since

For one, obtaining a BitLicense from New York State is not easy. It emphasizes clarity/transparency, AML/KYC, security, accountability, and consumer protection. This holds Bitstamp to the same high standard that is held by traditional/legacy financial institutions. 

Moreover, the fact that Bitstamp has been around since 2011 is a significant achievement of its own. 

While this is not a detailed review of the Bitstamp Exchange, I think that I’ve answered the question: What is Bitstamp Exchange

Please feel free to drop a comment, question, or note for me. I love hearing from my readers

Please follow and like us:

Author: Markshire Crypto

Millennial cryptocurrency investor, researcher, and writer. Medical professional, avid reader, proud nerd, and intellectual. Founder of Markshire Crypto. Mark has been into cryptocurrency since 2017, following the industry daily and creating content.

Leave a Reply

Your email address will not be published.