If you’ve been following our blockchain and cryptocurrency series, you know that there are several platforms where you can trade your cryptocurrency. So far, we’ve looked at Coinbase and Gemini. Now we’ll look at the Hong Kong-based Bitfinex cryptocurrency exchange.
Bitfinex (BFX) is the world’s largest Bitcoin exchange. Bitfinex cryptocurrency exchange allows traders to exchange U.S. Dollars for Bitcoin and several other altcoins, including Monero and Ethereum.
Ease of Use
Bitfinex offers a traditional exchange, but they also offer larger, private trades with their Over The Counter service.
Here’s the long list of available cryptocurrencies you can trade on Bitfinex: Ethereum, Bitcoin, Bcash, Litecoin, Iota, OmiseGO, Zcash, EOS, Ethereum Classic, Ripple, Dash, Monero, and Santiment against USD or BTC.
The app (available on iOS and Android) lets you execute and monitor trades and get important updates. It is recommended to execute larger trades on a secured desktop or laptop. You can add an API key instead of your username and password for a more secure mobile transaction.
More seasoned traders will love their variety of order types and the ability to make passive income with margin lending. For automated traders, Bitfinex cryptocurrency exchange offers an API.
The desktop interface is highly customizable, responsive, and full of details.
Bitfinex has the largest volume of any Bitcoin exchange, and as such, it is the world’s largest Bitcoin exchange. With the large volume though, it’s important to consider that buying and selling prices are more stable and closer together. With a low spread, traders can’t earn as much in a single trade.
High volume also affords Bitfinex high liquidity; buying a lot of Bitcoins isn’t going to move the charts much.
But Bitfinex also has the most traders due to being the largest Bitcoin exchange. This consistently high number of traders must mean that Bitfinex is doing something right.
Some people use Bitfinex’s Bitcoin price is a good indicator of price movement across the other exchanges.
Cost and Fees
Fees are low; takers pay 0.2%, makers pay 0.1%. Makers who exceed $7.5 million traded will not be subject to fees. Takers with $7.5 million traded may see fees as low as 0.1%.
Bitfinex has a history of bank issues regarding withdrawals and deposits. The best option is to buy Bitcoins from another exchange and deposit them into Bitfinex. This is an especially good plan when you consider that all other options except bank transfers are free to deposit into your account.
By circumventing bank transfer, you are able to quickly deposit your cryptocurrency, since it requires no identity verification.
The same goes for withdrawals. Between inconsistent withdrawal times and the withdrawal fees associated with USD withdrawals, it would be better to withdraw with a cryptocurrency and sell it elsewhere.
Bitfinex allows leveraged trading of up to 3.3 times.
Bitfinex uses two-factor authentication. It stores approximately 99.5% of user funds in an offline, multi-signature wallet.
A year ago, in August 2016, Bitfinex experienced a theft of 120,000 Bitcoins, worth $72 million USD at the time.
Bitfinex handled that situation by spreading the losses across all users. The users were told they’d eventually be compensated. Then, Bitfinex issued custom BFX tokens to all affected users. The tokens were proportional to the affected users’ losses. Those users have the option to wait for Bitfinex to buy back their tokens, convert the tokens to company equity, or trade them through the exchange. In April 2017, Bitfinex said they’d repay 100% of the tokens “shortly”, leaving behind no more debts to their users.
Since the 2016 hack, Bitfinex ensures its users that it has boosted security measures for the platform.
Like most other exchanges, Bitfinex doesn’t offer live chat support. Unlike other exchanges, however, Bitfinex does have an extensive knowledge base. While we haven’t tried to contact support, Bitfinex offers email customer service as well.
Between the banking issues and 2016 hack, many users are looking to other platforms to fill their needs securely and quickly. Though there are only a handful of secure, fast exchanges, Bitfinex cryptocurrency exchange is still a top contender.
*** Update 10/23/17: Bitfinex recently announced that it is terminating business for U.S. traders, effective November 9, 2017. This includes all functionality: trading, deposits, and withdrawals. If you are based in the U.S., please take a look at the other exchanges available to you. ***