Bithumb Review

About Bithumb

It hasn't always been smooth sailing for Bithumb, which is owned by BTC Korea. The exchange suffered near-crippling hacks in April 2017 and then again in the summer of 2017 that aside from the leaked customer data and tens of thousands of dollars in lost cryptocurrency funds led to a change in leadership at the helm.

 It has also had to work through regulatory delays that prevented it from taking new users for a while as South Korea stiffened know-your-customer (KYC) laws. This has resulted in greater security measures for users as well as more collaboration with banks. Users on social media platforms often point to a higher price for BTC on Bithumb versus other exchanges. On average, bitcoin trades 43% higher in South Korea versus the United States. International traders looking for arbitrage opportunities are typically met with a rude awakening amid strict bank transfer laws that prevent them from cashing in on a quick trade.

Bithumb supports the following coins:

Bitcoin, Ethereum, Dash, Litecoin, Ethereum Classic, Ripple, Bitcoin Cash, Monero, Zcash, Qtum, Bitcoin Gold and EOS. There's already a great deal of history behind the exchange, which first launched in 2014, and there appears to be a lot in store for Bithumb up ahead.

Advantages of Bithumb

• A trio of simple spot trading options = general trade/easy trade/reserved trade
• The website platform is available in six languages Korean, English, Spanish, Hindi, Chinese and Japanese
• Bithumb's mobile platform for 24/7 cryptocurrency trading launched on Oct. 18, 2017
• Numerous cryptocurrencies paired against the KRW
• Order book and order history
• Cheap trading fees
• Real-time data and charting on the dashboard
• International users can sign-up via mobile
• Brick-and-mortar customer support centre in Gangnam supporting four languages (Korean, Japanese, Chinese and English)
• Increasingly being integrated into the mainstream (malls, kiosks, etc)
• Trading pairs in KRW
• Increased security amid tighter regulatory controls surrounding KYC
• Employees are treated well (overtime pay, stock options, unlimited purchase credits, etc.)

Disadvantages of Bithumb

• No trading on margin (spot trading only while more sophisticated trading features are increasingly making their way to competing exchanges)
• Website appears geared toward Korean locals
• Only supports won among fiat currencies
• Fees for certain small deposits
• Deposits are only accepted in KRW (no other fiat currency) and supported cryptocurrencies
• Transfer fees and exchange rates offset otherwise low fees for international users (South Koreas BTC price is typically 43% higher than the US BTC price)
• No cryptocurrency pair trading available (only cryptocurrency to KRW)
• International users may be prohibited from making withdrawals via mobile amid multi-step identification verification process unless they use Korean telecom service provider
• Users under the age of 19 may be restricted from trading
• Suffered a hack
• Management shakeup
• Users demand more coins
• International bank transfer fees (despite cheap trading fees for locals)

Security at Bithumb

Bithumb for all of its progress suffered a major setback in 2017 when an employees computer was hacked and the personal data of some 30,000 users, including email addresses and phone numbers but not passwords, was compromised. The security breach was not of the Mt. Gox proportions (in which $460 million in BTC was lost.) Bithumb was able to regroup but not before losing somewhere around $82.7 million, according to estimates, in bitcoin and Ethereum. Bithumb also faced a fine from the South Korean government to the tune of $55,000 for failing to protect the personal information of its members, and regulators took the opportunity to bring security standards to the next level. While Bithumb was quick to point out that the security breach was the result of a single computer and not the exchange's servers, things took a turn for the worse shortly after. They suffered an outage in November 2017 when servers went down amid a surge in traffic, which resulted in deposit and withdrawal delays for users. Bithumb wasn't prepared for the 800% spike in trading volume from October 2017 to the following month. The exchange blamed the change in dynamics surrounding Bitcoin Cash, which resulted in users choosing to speculate on other digital coins. Meanwhile, though cryptocurrency exchanges remain loosely regulated around the world, South Korean regulators clamped down on trading following the hack. South Koreas Financial Services Commission abolished the use of anonymous bank accounts for trading bitcoin, etc., which was previously allowed at Bithumb. Regulators instead rolled out KYC protocols/real-name verification standards for banks in the country to prevent money laundering activity from taking place. Bithumb in response made it possible for users to verify their identity through Nonghyup Bank and Shinhan Bank to start and did so in 10 days, which was faster than competing exchanges. Bithumb is somewhat transparent with its users on social media. For instance, in response to requests to add more coins, Bithumb explained that they won't even tip their hand to employees about new coins that are in the pipeline. This is the right approach in light of a class-action lawsuit that was filed against competing for Bitcoin exchange Coinbase, which was sued for allegedly providing insider information to employees about supporting Bitcoin Cash. Meanwhile, according to this Reddit thread, Bithumb adds no more than one new digital coin monthly because of the operational learning curve for each one. David Lim, Bithumbs global business development manager at Bithumb, told Fortune: Bithumb considers the coins security, technology and investment worth when listing a coin. Bithumb will continuously introduce competitive coins in [the] Korean market by studying their technology and considering the cryptocurrency market status. The exchange also experienced a management shakeup in 2017 in which the company's CEO, Richard Jung, who is largely responsible for creating Bithumb, was replaced by gaming executive Jeon Soo-Yong. The new chief executive has committed to creating a healthy environment in cooperation with regulators.

Bithumb Fees

Bithumb boasts attractive fees, particularly for local residents. The exchange offers zero-commission deposits across both cryptocurrencies including BTC, Ethereum and the others its supports as well as fiat money. Bithumb does charge withdrawal fees, including KRW 1,000 for fiat money withdrawals. Bithumb adheres to the following fee structure - Source: Bithumb.com Between Asian cryptocurrency exchanges Bithumb, Huobi, Bitfinex and Upbit, the average transaction fee is 3%, while the average trading volume among this group is between $600 million and $1.4 billion. The following top 10 exchanges are inching closer toward generating more than $1 billion in yearly revenue, as per Bloomberg data based on trading volume and fees.

Using Bithumb

Contrary to popular belief, international users can sign up on Bithumb, including on the mobile app (though there are some restrictions tied to mobile app withdrawals for international users.) The sign-up process is fueled by the user's email address, which is also used as a customer ID. The email is also vital for making withdrawals, so users are urged to enter their information accurately. Bithumb recommends users select passwords that they don't use elsewhere and to incorporate special symbols with passwords. Here's an example of what you'll see when you begin to sign-up for Bithumb: To sign up, users must first verify their identity through a series of steps outlined below. Once signed up, users gain access to my page, which displays details such as your verification level (Level 1, Level 2 Level 3 and Level 4). Your verification level determines the number of hoops you'll have to jump through when proving your identity for transactions on the website and via mobile. Level 1 = mobile phone SMS and verification email Level 2 = ID confirmation via mobile phone/PIN/ID-Passport Level 3 = corporate agreement and personal agreement Level 4 = proof of residence Next you can begin trading. Your funds are kept in a digital wallet hosted by Bithumb or you can transfer to an external wallet for safekeeping.

Customer Support

Bithumb takes customer support to another level with its brick-and-mortar support centre located in Gangnam, South Korea. Hundreds of customers visit the hub daily, which operates around the clock and is staffed with hundreds of support personnel, many of whom spend the day wearing their slippers, which is customary in the region. Among the visitors are elderly people who are looking to understand cryptocurrencies. Bithumb agents also field thousands of calls per day, many of which are from customers that are having trouble with the verification process or who want to know more about cryptocurrency trading. Bithumb in response to demand at the Gangnam location plans to expand with more physical hubs in Seoul as well as other cities throughout the country. Bithumb also provides an email address for users to report issues, at [email protected]. Or the following phone number - 82 1661- 5551 (when prompted, press 1 for English.)

Bithumb Mobile

Bithumb launched its official mobile app in October 2017. The app was initially launched on Android with plans to expand to iOS soon. The mobile app launched with plans to facilitate 24/7 cryptocurrency trading, which is more than some other cryptocurrency exchange apps that merely display digital coin prices. Bithumb mobile is only available in Korean and English languages, which may frustrate users in India, for example. But Bithumb mobile boasts similar features to its website, which in addition to trading include deposits via QR code for money transfers. There's also an address import tool that removes the need to manually enter user information such as an email address for SMS verification. Users like the one-time registration for the mobile app but there are also complaints, with Bithumb earning barely a 3- out of 5-star rating. One of the complaints is that the app doesn't remember the user's language preference, and as a result, that feature must be changed for every single trade. A user in The Republic of Cyprus complained that Bithumb wouldn't recognize the country's area code, preventing the user to complete the identity verification process and access the app. Bithumb addresses situations like this on its website, saying that international users who run into problems verifying their account should visit the account support page and upload an image of their passport. Source: Tech for Korea

Summary

The security breach that Bithumb suffered remains top of mind for users. But the fact that South Korean regulators responded by clamping down on KYC protocols and stricter bank account requirements offers users a greater sense of security. Bithumb, which is owned by BTC Korea, is more user friendly than many of the other exchanges out there, with both a physical support location already established in South Korea and plans for more brick-and-mortar centres throughout the country. Its ease of use for local investors notwithstanding, Bithumb overall is a competitive global player. The exchange is innovative, and its brand is increasingly being spread throughout mainstream businesses. It's clear why Bithumb is widely used in South Korea and its popularity should surge alongside the adoption of bitcoin and other cryptocurrencies in the region. While vulnerabilities were uncovered, Bithumb appears to be more secure as a result of these breaches and is taking its users privacy seriously, as evidenced by change at the helm. This focus on security has resulted in frustration amid withdrawal delays and verification issues, particularly among international users, but it's a theme that's pervasive among bitcoin exchanges, not just Bithumb.

More Resources:

• Payment Methods
• All Cryptocurrency Exchanges
• Cryptocurrency Exchanges by Country