Throughout this Bitstamp vs Kraken review, we will cover what are each platform’s strengths and weaknesses in order to help you decide which is the better choice.
Bitstamp and Kraken are two massive players on the crypto exchange market, having a combined daily trading volume of more than $300,000,000.
|Buy/Deposit Methods||Bank Transfer, Credit/Debit Card, Cryptocurrency||Debit Card, Bank Transfer|
|Sell/Withdraw Methods||Bank Transfer, Credit/Debit Card, Cryptocurrency||PayPal, Bank Transfer, Cryptocurrency|
|Available Cryptocurrencies||5 – Ripple, Bitcoin, Ethereum, Bitcoin Cash, and Litecoin||31, including Ripple, Bitcoin, and Ethereum|
Bitstamp was founded by Nejc Kodric and Damian Mertek in 2011 in order to compete with the then-giant Mt. Gox ( Currently Closed ). Initially located in Slovenia, the central office of the business was moved in the UK in 2013 and in Luxembourg in 2016.
Kraken is a US-based cryptocurrency trading platform located in San Francisco. The company was founded by Jesse Powell in 2011 as a response to the Mt. Gox security breach but was released on the market in 2013.
Initially accepting only Bitcoin and Litecoin for cryptocurrency trading, today Kraken has extended its support to 31 cryptocurrencies as well as numerous currencies including Euro, US Dollar, and Canadian Dollar.
Bitstamp vs Kraken – Getting started
When it comes to trading cryptocurrencies, neither Bitstamp nor Kraken were designed for beginners.
Both platforms offer advanced trading options, which may seem intimidating for users that are just getting started with crypto trading.
Setting up an account on Kraken is pretty straightforward. All you have to do is register and confirm your account via email, and provide basic personal information such as name, date of birth, country, and phone number. However, Kraken imposes certain deposits on its users, consisting of a maximum deposit/withdrawal of $2,000 per day or $10,000 per month.
In order to increase your limit, you will need to provide identity proof through a government-issued ID. This will increase your limits to $50,000/week and $200,000/month.
Bitstamp, however, is a bit more complicated when it comes to registration. In order to start trading on their platform, you have to provide front and back photos of a government-issued ID and a bank or utility statement, along with basic personal information.
While these procedures may seem to be on the opposite end of the anonymity concept that surrounds the crypto industry, they are necessary when it comes to security.
But despite Bitstamp’s complicated sign-up process, one of their huge advantages is the support for debit and credit cards.
If you want to make a fiat deposit on Kraken, you’re stuck with a bank transfer that can take anywhere between 1 and 5 business days. With Bitstamp, you can make a payment with your card and your deposit will be available in a matter of minutes.
Bitstamp vs Kraken – Trading
As I mentioned above, Bitstamp and Kraken were both developed for more experienced traders.
Bitstamp takes a “quality over quantity” approach, providing only a few trading options that work very well. Their platform allows you to place the following types of orders:
Kraken, on the other hand, provides a plethora of trading options for its users, tailoring to very experienced traders.
One of its major services is margin (leverage) trading, which allows users to trade using more capital than they actually have.
This means that if you deposit $500 worth of ETH, you can trade with a maximum of 5x leverage. Therefore you can buy $2,500 worth of ETH using only $500.
While this is a great method to capitalize on your investment, it can also be a quick way to drain your account. If the price of ETH rises, your investment could be worth $5,000 instead of $2,500, enabling you to earn massive profits. But if the price of ETH drops, you could find yourself at a loss, owing Kraken several hundreds or thousands of dollars, depending on your investment.
Kraken also provides OTC (Over The Counter) services for individuals and businesses who are looking to trade upwards of $100,000. OTC trading takes place on a separate platform, allowing crypto whales to trade their funds without impacting the price of a currency.
Bitstamp vs Kraken – Trading Fees
Both Bitstamp and Kraken have a variable fee system based on a user’s 30-day trading volume.
Bitstamp charges a 0.50% fee for all trading pairs on a 30-day volume of less than $10,000, with the fee dropping to 0% for a trading volume of over $10,000,000,000.
When it comes to fiat fees, most of Bitstamp’s deposit fees are free of charge, except for international wire transfers where they charge a 0.05% fee
In terms of withdrawals, Bitstamp has the following fees:
- 3.00 EUR for SEPA withdrawals;
- 0.1% for international wire transfers.
For credit card payments, Bitstamp charges a 5% fee regardless of the amount, and additional fees may be charged by the user’s bank.
Kraken’s fees range from 0% to 0.26% of the total transaction value, depending on your 30-day trading volume and your role in the transaction (maker or taker).
A user with a trading volume between $0 and $50,000 is charged a 0.16% if he is a maker and 0.26% if he’s a taker. Just like in Bitstamp’s system, the fees can go as low as 0% for makers and 0.10% for takers with a trading volume of more than $10,000,000.
Kraken applies two additional fees for margin trading:
- A margin opening fee;
- A margin rollover fee.
When it comes to fiat transactions, Kraken charges according to the payment partner.
- US wire transfer (USD) – flat rate or $5 for deposits/withdrawals;
- SEPA bank transfer (EUR) – free deposits, EUR 0.09 for withdrawals;
- Canadian wire transfer (CAD) – free deposits, but the bank charges a fee of around $10.
- Electronic funds transfer (CAD) – 0.25% withdrawal fee.
Kraken is known to be one of the most competitive crypto exchanges when it comes to trading fees, and this can also be observed in its comparison to Bitstamp.
However, Bitstamp’s fees are still low when compared to other major crypto exchanges.
Bitstamp vs Kraken – Available currencies
When it comes to available currencies, Kraken is clearly in the win in the Bitstamp vs Kraken debate.
Kraken accepts 5 fiat currencies – Euro (EUR), US Dollar (USD), Canadian Dollar (CAD), British Pounds (GBP, and Japanese Yen (JPY) and 31 cryptocurrencies, including:
- Ripple (XRP);
- Bitcoin (BTC);
- Bitcoin Cash (BCH);
- Ethereum (ETH)
- Ethereum Classic (ETC);
- DASH (DASH);
- Litecoin (LTC).
Bitstamp, on the other hand, accepts only 2 fiat currencies – Euro (EUR) and US Dollar (USD) and 5 cryptocurrencies – Ripple (XRP), Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH).
Bitstamp vs Kraken – Security
Kraken is the only major cryptocurrency exchange that has never been hacked. However, there have been numerous instances where traders complained of delayed bids and transactions.
For example, one of the most common issues on Kraken is caused by lagged transactions. Several users submitted a buy/sell order, only to discover their order was not completed. They then proceeded to submit it again, with both orders ending up being completed at the same time.
Bitstamp was the target of a major attack back in January 2015. 19,000 BTC were stolen, causing losses of more than $5,000,000. And while that may be enough to force numerous crypto exchanges to close shop, Bitstamp was (and still is) a reputable player on the market, and paid back all customers from their profits.
Bitstamp vs Kraken – Availability
Kraken is (almost) available on a global level, with a few exceptions:
- North Korea;
Additionally, due to several local restrictions and regulatory compliances, Kraken isn’t available to residents of Washington and New York.
Bitstamp is available in all of Europe’s 28 member states, as well as in almost 50 other countries, including Australia, Brazil, China, U.S., and South Korea.
Bitstamp vs Kraken – Customer Support
When it comes to crypto trading, the customer support provided by the platform is crucial.
Bitstamp offers email support, with users being able to submit tickets through their website. Their response time varies from 24 to 72 hours, but they also have an emergency phone number which you can use in case of, well, an emergency.
Kraken can also be contacted via website tickets, with their response time being similar to that of Bitstamp’s - between 1 and 3 business days. However, several users have complained about issues in Kraken’s account verification process.
In my opinion, in the Bitstamp vs Kraken debate, Kraken takes the win. They support more cryptocurrencies, are available in more locations, and have better trading fees than Bitstamp.
And even though they get a minus in the customer support category, their excellent security plays a big role in them being called “the top crypto exchange” by many.
However, Bitstamp is still a strong player on the market, and despite them providing fewer services than Kraken, they clearly state that they focus on quality rather than quantity. And this can be observed in their reaction to the 2015 hack, where they paid back all their users from the company profit.