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Coinmama Review - 5 Things To Know Before Using in 2021

Coinmama is a platform for buying and selling cryptocurrency founded by Nimrod (Nimi) Gruber and his colleagues in 2013. According to Coinmama’s website, the primary objective of the exchange is to further the original ambition of cryptocurrency and to rid the financial sphere of middle-men and hidden fees. 

The exchange obtained its license in Slovakia, but its operational headquarters is in Israel. Coinmama serves millions of customers in 188 countries. The exchange stands out as a platform that helps people around the world access digital currencies fast and safely. 

How to Get Started with Coinmama

1

Register

The signup process on Coinmama is fast and straightforward. You need to provide a valid email address at the registration phase, and that is it, you’re in! However, you cannot buy Bitcoin or any other cryptocurrency before you complete your profile. You will need to provide a valid government-issued ID and a recent passport photo of yourself to complete the profile.

2

Deposit Funds

Coinmama only supports the buying and selling of digital currency and does not take deposits. When you want to transact, say to buy bitcoins, you will provide the payment method you want to use, and money will come directly from your bank account to Coinmama’s bank account. The exchange accepts payments from SEPA, VISA and Mastercard payment cards, and bank transfers.

3

Start Trading

With your payment option ready, you can now go to the ‘Buy’ tab and initiate the purchasing process. Coinmama offers three Bitcoin packages of $100, $500 and $1,000, but you can also specify another amount. The most striking thing when purchasing Bitcoin and other cryptocurrencies on Coinmama is the simplicity of the interface. The interface is minimalist and easy to navigate.

Coinmama Interface and User Experience

Coinmama’s interface is designed to be simple and easy to use. To achieve such simplicity, while providing all the information one needs to accomplish one’s goal, is a remarkable achievement.

The different bundles for buying cryptocurrency take up the bulk of the interface. If one of the bundles is right for you, all you need to do is click on the ‘Buy’ button and complete the details of the transaction. On the far right side of the page, you can enter a different dollar amount for the cryptocurrency you wish to obtain. 

The experience is the same when you want to sell your cryptocurrency on the platform. Coinmama gives you clear directions, sometimes accompanied by a few points of explanation. Arguably, Coinmama is a breath of fresh air in an industry where most exchanges gather numerous services under one roof, with the aim to sell as much as they can. On the contrary, it seems Coinmama cares more about the experience you will have rather than the fees and commissions they can squeeze out of its users.

Key Considerations for Coinmama

Besides simplicity and a great user experience, Coinmama stands out in other aspects also. We guide you through a few of them below: 

Limits and Liquidation 

There are four account levels on Coinmama, each with a specific transaction limit. 

  • Level 1 – this is the most basic account where the user verifies their email address, as well as their identity by providing a government-issued ID and a photo of themselves holding their ID. The transaction limit for this account is $15,000 per month and $5,000 per day.

  • Level 2 – you are eligible for a Level 2 account if you have already purchased $7,500 worth of cryptocurrency with Coinmama. Additionally, you will need to fill and upload a know-your-customer (KYC) questionnaire, and provide more personal information and supporting documents, such as a utility bill (if you already have a Level 1 account).This account has a daily transaction limit of $5,000 for bank cards and $35,000 limit for wire transfers. The monthly transaction limits are $30,000 for bank cards and $50,000 for wire transfers. 

  • Level 3 – you meet the requirements for this account level after you have spent $50,000 to buy cryptocurrency. The daily transaction limit for bank cards is $7,500 and $50,000 for wire transfers. On the monthly side, the transaction limit for bank cards is $40,000 and $100,000 for wire transfers.

  • Level 4 – this is the ultimate Coinmama account. Because of the special status of customers wishing to transact at this level, Coinmama encourages interested users to contact the VIP customer support team for further directions. 

Safety, Security and Privacy

NBV International is the company that owns New Bit Ventures, which in turn oversees Coinmama’s operations. Nimrod Gruber and fellow co-founders incorporated NBV International in Slovakia under the Transactional Functions licence. This licence is Coinmama’s first level of security for its customers.

Furthermore, Coinmama obtained a significant nod from the US when the Financial Crimes Enforcement Network (FinCEN) certified the exchange as a safe platform for financial transactions. FinCEN enforces US regulations concerning financial crimes, and it must greenlight any business that would like to serve US citizens.

Coinmama has strong guidelines in place against financial crimes, including stringent procedures covering counter-terrorist financing (CTF), know-your-customer (KYC), and anti-money laundering (AML). The platform collects personal information about its users, and it assesses the AML and CTF risks associated with the users’ activities.

On the issue of privacy, Coinmama is upfront concerning the information it collects from users and how it is used. According to Coinmama’s website, the platform collects information about users’ activities, KYC details, communication data and device information. The information goes a long way in helping the platform to enforce safety measures and make things convenient for its users. From our perspective, Coinmama’s activities are an industry standard and are in line with privacy laws across major jurisdictions such as the EU and the US. 

Deposit Times and Transaction Speeds

As mentioned above, Coinmama only offers the means to buy and sell cryptocurrency, and does not offer many other features. For this reason, the exchange does not take deposits from users. Instead, users transfer money directly from their bank accounts to Coinmama’s bank account after quoting the amount of cryptocurrency they wish to buy. 

The transaction times are determined by the payment method you choose to use. For instance, a wire transfer takes the shortest time to complete because the verification process is simpler as it happens with bank transfers. However, the transaction speeds involving the transfer of cryptocurrency is almost instant. The tokens will appear in your wallets in a matter of minutes after you make the necessary payments. 

Coinmama Fees

Coinmama has two sets of fees, one set for cryptocurrency buyers and another for sellers. Before we get down to details of the fees, let us point out that the exchange determines these based on the TradeBlock XBX index. The TradeBlock XBX index provides an average market rate for cryptocurrencies, bearing in mind that the crypto market comprises various providers, each with a unique rate. 

  • Fees incurred on buy orders – Coinmama determines the fees based on the payment method and the user’s loyalty level. All buy orders are subject to a commission at a flat rate of up to 3.90%. Transactions with bank cards (debit/credit/virtual cards) incur an express fee of 5.00%. On the other hand, bank transfers (SWIFT transfer) incur a flat fee of £20 (for non-UK customers). 

  • Fees incurred by sell orders – loyalty levels determine your fee and rate when selling cryptocurrency on Coinmama. Curious loyalty level (the lowest level) users incur 2.9% of the total order in fees, while Enthusiast and Believer level users incur 2.5% and 2.1% in fees respectively.  

Customer Support

Coinmama has a strong customer service team called Happiness Heroes. You can reach the Happiness Heroes via a contact form on the Coinmama website. We found this venue to be the most reliable means of communicating issues because you have time and space to articulate them as best as possible. Also, the Happiness Heroes reach out faster on this venue. Alternatively, you could use the customer support email, but the response time is not as fast as with the former. 

Furthermore, our research on various online platforms found that users prefer the contact form because it is handy and gets timely responses. With this background in mind, we have no doubt saying that the Coinmama customer support is of great quality.

How to Use Coinmama

While Coinmama offers more focused services, it does not imply that the platform does not require some orientation for best usage. That is why this section offers to guide you through its primary processes: 

How to Deposit on Coinmama

Coinmama does not feature an in-built wallet function, so you cannot deposit your existing Bitcoin holdings to the exchange.

You can use the platform to access the digital currency you want and pay for it straight from your bank account.

How to Buy Bitcoin on Coinmama

After verifying your details after setting up your account, it is time to get down to business. To buy Bitcoin or any other cryptocurrency, select the amount in US Dollars you wish to purchase. You might want to select one of the packages from the given list. A specific amount in the provided space will suffice if your choice is not in the package list. Click ‘Buy Now’ afterwards.

Now you need somewhere to keep the Bitcoin that Coinmama will hand over. The exchange suggests ZenGo and EXODUS (hot cryptocurrency wallets) and Ledger and TREZOR (cold wallets). A hot wallet is one users can easily access online, while a cold wallet is offline, often on a USB-drive like device, and the safest because they are out of a hacker’s reach.

The next step is to choose your preferred payment method. Coinmama supports VISA and Mastercard, SEPA and bank transfers. For the last time, you need to confirm the address of the wallet that should receive the coins. Coinmama will send the bought coins immediately after you cover all the steps.  

How to Send Bitcoin on Coinmama

Coinmama does not provide cryptocurrency storage services. There are many crypto wallets on offer out there to use for this purpose

How to Withdraw Money on Coinmama

Coinmama does not hold users’ funds since the money moves from your bank account to the exchange’s bank account. As such, the exchange does not include a ‘Withdraw’ option. 

Coinmama Pros and Cons

Pros

Coinmama offers high limits for purchasing cryptocurrency
Instant purchase of crypto using bank cards
The service is accessible virtually everywhere in the world
Easily reachable and responsive customer support team
Simple interface that is beginner-friendly
Lower fees compared to most crypto exchanges

Cons

Does not have a mobile app
The Sell option is not available to all users
A narrow range of digital currencies one can sell

Final Thoughts | Is Coinmama Legit?

One of the limiting factors of cryptocurrency is the technical nature of the concept as well as its usage. Thanks to Coinmama and a few other platforms, you are now able to own digital coins without having to master the technology behind them. Also, the platform has simplified the process of converting your coins into fiat currency. 

Nevertheless, as the Coinmama website aptly explains, digital currencies carry an inherent risk due to price volatility and other factors. Importantly, make sure you understand the crypto market fully, how the price of each coin fluctuates and what causes it, among other details, before buying.

Overall, Coinmama does a great job to give its users the best experience by using Happiness Heroes and other techniques. Coinmama faces competition from exchanges that are equally as innovative, but we are confident that the industry of its team will propel it to a higher pedestal.

Frequently Asked Questions

  1. Coinmama is an exchange where you can buy and sell digital coins. It supports a range of payment methods that not only lighten the weight of transactions but also make it more convenient.

  2. You will receive your coins immediately after Coinmama confirms your wallet address and your payment.

  3. Coinmama uses the TradeBlock XBX benchmark to determine its fees, making it one of the fairest on the market. The exchange charges a commission of up to 3.92% on buy orders and up to 0.9% for sell orders. Transactions with bank cards incur a 5% momentum fee while SEPA is free. Altogether, Coinmama charges competitive rates as reported by many online reviews, and perhaps that is why it appeals to more than 2.4 million people in 188 countries.

  4. Coinmama accepts all currencies from all countries in which it operates.

  5. Coinmama does not operate as a broker but an active crypto buyer and seller. The exchange stores all the coins it buys in a personal inventory, the same way it sells coins from its inventory. Transactions between you and Coinmama are safe because you are dealing with the platform itself, not third parties.

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