Coinmama is one of the fastest growing cryptocurrency exchanges due to it being easy, fast, and secure. It also allows the crypto curious to buy digital currency with credit cards.
COINMAMA REVIEW AT A GLANCE
- Multiple payment options
- Available in over 188 countries
- Top tier customer support
- Instant order delivery
Top rated Bitcoin exchange
Pros & Cons
Coinmama isn’t one of the larger crypto exchanges, nor is it often mentioned when newcomers are asking for the best places to trade.
Still, it has found its feet in the cryptocurrency ecosystem and when discussing exchanges, it’s likely to surface sooner than later.
Since Coinmama isn’t a huge exchange, it can’t boast of a huge transactional size as Binance does, nor can it boast of the number users as Coinbase does.
It can however make a meal of its experience in the market, since the exchange has been around since 2013, but to be fair, plenty of the big exchanges today have been around for almost a decade.
Account Minimum: $0
Fees: 5.50% per transaction
Promotion: No deposit or withdrawal fees
What is Coinmama Exchange?
Coinmama’s selling point to attract people is simple: It offers credit card purchases for Bitcoin, Ethereum, Bitcoin Cash and a handful of altcoins as a leading feature.
While this might seem like a silly way to attract customers, it does work – most exchanges don’t allow credit card purchases, and the ones that do are either heavily regulated, offer ridiculous minimal purchases when using credit cards, or simply don’t mention they accept them anywhere.
It is this feature what has allowed Coinmama to grab a portion of the market, particularly among newcomers who might not be able to make purchases via bank transfers.
However, the question remains: Is Coinmama a decent exchange if we ignore its selling point?
There will be answers for both sides of the divide here, and one thing you can be sure of is that there are enough points to chew on.
Who is behind Coinmama?
Schuster and Newman were Bitcoin enthusiasts who were looking into investments back in the days when high fees and difficult payment methods were the norm.
Rather than giving up, the duo decided to start their own company, one that operated in the mode of easy and fluid pattern of online business. Both founders seem to have moved onto other projects since.
Asap Schulman was its CEO since 2017 until earlier this year. He has been a part of the crypto scene since 2013, and before then, he had experience with tech solutions in Israel and Australia, particularly on cyber security systems.
He was also responsible for the first Bitcoin ATM in Israel. More importantly, Schulman was at one point the General Manager for eToro’s operations in Australia, an experience that likely helped his leadership in Coinmama.
Operational spread and strength
Although registered in Slovakia for business purposes, Coinmama’s base of operation is still in Israel. Coinmama’s current offices are located in Raánana, and there are no alternate offices anywhere in the world.
The reason for the Slovakian registration is that Coinmama itself is owned by a Slovakian company. As to expansion and future plans, there are no insights at present in that regard.
Payment Methods and Fees
In the past, Coinmama attracted some criticism for its limited selection of payment methods - but this has now changed.
In 2022, at the time of writing, Coinmama accepts:
- SEPA Instant
- Swift (Global)
- Swift Fast Payment (UK)
- Open Banking (UK)
- Bank card
- Apple Pay
- Google Pay
Only Fedwire and SEPA are accepted for sell transactions - but for buying orders, there are generally multiple options for your local fiat currency.
Rates to expect for withdrawals and deposits
Coinmama doesn’t charge anything for standard withdrawals and deposits. That’s not because it makes no money.
This is so because Coinmama doesn’t allow withdrawals or deposits. All transactions using Coinmama are paid directly from the source fiat currency and delivered straight to a crypto wallet that you specified.
Coinmama doesn’t have its own crypto or fiat wallets, so it’s impossible to keep your money stored on the platform.
Even if you sell BTC to Coinmama (the only crypto it buys) you get paid directly to your bank account, so it’s impossible to keep a balance on the site.
When using credit or debit cards, be aware that you might incur cash advance fees from your card issuer.
Also, keep in mind that even when Coinmama says it charges a 0% rate, there’s already a margin for the site calculated in the price you’re offered, the site is just not charging you any transaction fees on top of that.
Any seasoned crypto enthusiast will tell you - nothing is ever free.
Rates for buy/sell transactions
For purchases, Coinmama’s fees vary depending on the payment method used. When purchasing using a credit or debit card, there’s an additional 5% processing fee on top of the transaction value.
When purchasing via a SEPA bank transfer, there is no processing fee, although your bank might charge fees on their own. When purchasing via a SWIFT bank transfer, all orders under 1000USD have to pay a 20GBP fee.
Orders above 1000USD incur no processing fees. As with SEPA transfers, your bank might add extra fees on top of these.
Coinmama only accepts credit cards, debit cards, and bank accounts to pay for transactions. To be specific, the site accepts:
- VISA and MasterCard credit or debit cards. American express and Discover cards are NOT accepted.
- SEPA Bank Transfers.
No other payment methods are accepted.
Since Coinmama doesn’t have its own crypto wallet, all purchase transactions are automatically sent to the customer’s own wallet – and therefore, there is no need to cash-out your cryptocurrencies.
For fiat cash-outs, this changes. First, you can only cash-out fiat if you sell Bitcoin to Coinmama. The company doesn’t buy any other types of crypto, even when they do sell several currencies.
Bitcoin sales made to Coinmama are paid via SEPA or SWIFT bank transfers. No other payout methods are available.
Transaction Completion Periods
The one advantage that Coinmama’s meager offerings on the payment and payout methods has is that it’s not difficult to know or understand what the transaction completion periods are.
For purchases, the transaction periods depend on your funding source – once again, since you can’t have funds in your account, you’ll always have to use one of those.
Transactions via credit or debit card usually clear within a few hours.
While “a few hours” is vague and unusually long for a credit card purchase, this is due to Coinmama’s system, which forces the transaction to be confirmed.
Thus, a credit card purchase has to:
- Get confirmation from the bank that the card or account has funds.
- Confirm the customer’s crypto wallet exists.
- Send the crypto via the blockchain and wait a variable amount of time (usually minutes, but in occasion hours) for the transaction to be verified and processed.
Usually these steps clear quickly, but there’s always a waiting time.
The site does offer a rate lock, meaning your exchange rate is locked when you start the transaction – so if for whatever reason it takes days to clear, you’ll still get the rate you first agreed to.
Transactions using bank accounts can take a bit longer than credit card ones, although usually the difference is minimal.
As for withdrawals, Coinmama processes the deposits via SEPA as soon as the BTC transaction sent to its wallet has been verified and processed – so the waiting time is roughly as long.
Operations & Dashboard
One of Coinmama’s main goals is to make buying cryptocurrency easy. As such, the user interface is clean and simple – in some ways, in fact, it is minimalist.
While many exchanges immediately greet you with graphs and listings on how each currency, they trade is doing, the scenario here is different.
If you want to know how well a currency is performing, you’ll need to look for the information elsewhere, since the site only gives you the current price for any of the traded tokens and not much else.
This might look out of place, but in truth it’s an interesting choice, and one that fits the exchange. Other exchanges, like Binance or Coinbase, are geared towards crypto traders – people who buy low, sell high, or who at least attempt to.
Coinmama is instead minimalist, a place made for those looking to invest in crypto- who just want to log in, purchase, and log out. In that regard, Coinmama delivers exactly what you need.
Another feature of Coinmama that isn’t often seen in other exchanges is offering their crypto in sets with specific prices.
For example, rather than having to choose the exact amount of BTC you must buy for the money you have, you can buy $10, $20, $50, $100, $200 in BTC.
You’ll pay set, easy to understand amounts of fiat currency and receive an equivalent amount of cryptocurrency in exchange without having to calculate either.
If you want a custom amount, you can also get it, of course, but the existence of these preset amounts makes the process of buying crypto much faster for some people.
Unlike other exchanges, Coinmama does not offer an android or iOS app to allow its customers to trade on the go.
While this might be seen as a major failure for some people, the design of the site and business itself doesn’t require an app – apps are great for exchanges that expect people to be constantly buying and selling crypto, whose customers will want to react immediately to market swings.
For Coinmama, that’s not the case, as the broker only sells cryptocurrencies, buying exclusively Bitcoin and only for European clients.
That doesn’t mean an app wouldn’t be welcome – just that, as per Coinmama’s business design, the company isn’t cut out for this frontier at this time.
Since Coinmama doesn’t offer a wallet of its own, nobody has ever lost the crypto traded on the site.
On that regard, your crypto is 100% safe with the site, although that’s simply because you can’t hold it there at all. All cryptocurrency you buy from Coinmama must be deposited in a wallet of your own.
While that should mean that Coinmama is absolutely safe and hackers can’t get anything from you, that isn’t the case. In a scenario that the site can’t be the target of crypto hackers, it can be the target of regular phishing schemes.
In 2019, a list of emails and hashed passwords of Coinmama users was made public, raising doubts about the website’s security.
The hack was made in 2017, the list only surfaced a couple of years later, and the passwords were hashed, but that’s still a major problem for a crypto exchange.
While Coinmama states the information hasn’t been used to try and steal accounts, the incident still speaks poorly of the platform’s security rating.
So while your crypto can’t be stolen from Coinmama, you should be wary of its security and use a unique password for the website (as you should already be doing for all websites anyway.)
Account opening requirements
In order to open an account with Coinmama, you’ll be asked for your email, password, full name, and country of residence.
While it might be tempting to misrepresent yourself if you want to remain anonymous, as of 2022 all users of Coinmama must be verified, so a fake name will only get your application rejected down the road.
The first step in verifying your account with Coinmama is the basic KYC requirement: A government issued ID.
This ID has to be either a valid passport (Not acceptable for US residents,) a driving license, or a national ID card. The picture must be clear and have both sides of the ID or, for passports, the double page where the identification is hosted.
Besides this, the customer must provide a selfie- holding a piece of paper saying “Coinmama” and the current date along with other personal info such as their address and ZIP code.
After doing this, the account will attain basic verification and the user will be allowed to start trading as a Level 1 user, giving you a purchase limit of 7,500 USD.
Once you have completed Level 1 verification, all further steps are optional. Levels 2 and 3 are only necessary if you plan on purchasing large amounts of crypto.
To reach verification Level 2, you’ll have to provide a secondary ID and a utility bill to confirm your address. Once this is done, you’ll be able to purchase up to $50,000 in crypto.
Level 3 verification requires filling a short form to be eligible.
The contents of the form aren’t disclosed by the business. Completing this one allows you to purchase up to a million dollars in crypto.
NOTE: A part of the verification process includes making sure you live in one of the areas Coinmama serves.
While Coinmama does serve most countries in the world (the only exception being places like North Korea that are under heavy international sanctions,) it doesn’t serve all US states.
If you have any doubts about your eligibility, you can check Coinmama’s knowledge base.
How a typical transaction works
To purchase cryptocurrency, you must first go through the verification process. Once that is done, you are given full access to your dashboard.
The dashboard will show you the tokens Coinmama sells (basically BTC, ETH, and altcoins,) the price they’re being sold for, and buttons used to select different amounts of fiat currency to spend on your preferred crypto.
If you want to spend a custom amount, you can also choose it. After choosing, you’ll have to enter your payment options – that is, either your credit card or banking info.
Once Coinmama has verified your banking info, you’ll be asked for the address of the crypto wallet where you want your tokens deposited. The standard waiting period between placing an order and receiving your crypto is a few hours.
Coinmama only allows customers from the Single Euro Payments Area to sell cryptocurrencies, and it buys Bitcoin exclusively.
As such, it’s not your best option to sell crypto if you are in far-flung places.
Still, if you wish to, the process is simple. You must click on the “sell” button on your dashboard. Then, you’ll be asked the amount of Bitcoin you want to sell.
Enter the exact amount there. You can also enter the amount of EUR you want to get, and the site will show you the amount of BTC you must deposit.
You must then enter your bank details so the SEPA transfer can take place. Then, just send the amount of Bitcoin you specified to Coinmama’s wallet.
The Euro will be transferred to your account once the crypto is received.
Although Coinmama’s own website boasts having excellent, second-to-none customer support, that’s not exactly the case.
Coinmama does have decent support, usually responding most queries within twenty-four hours. However, the site is lacking in support methods.
As of Jan. 2022, other than using the knowledge base users could only get support via email or by leaving a message on a mobile phone number based in California.
This can make it troublesome for some people to get support, particularly since the knowledge base seems to omit several questions or outright not answer them – and that’s when articles could have broken links.
The site does have decent to good reviews on crypto review sites, so it doesn’t offer poor support. It’s just not as stellar as it portrays.
Coinamama vs. Competitors
Should You Purchase Cryptocurrency on Coinmama?
Coinmama doesn’t seem to be in any danger of going under anytime soon. The site has been around for nine years already and seems to be doing steadily.
However, the growing crypto market and increasing penetration of other exchanges might change this.
While large exchanges (and even some smaller ones) are constantly pushing the envelope, adding new features, lowering rates, allowing customers to pay in different ways, trading more currencies and so on, Coinmama seems content just as it is.
For now, its play of taking credit and debit card payments is working, even when Binance also allows users to purchase BTC and ETH via credit card at a lesser rate.
It's place in the market is safe, but only for now. As crypto grows closer to mainstream use and large private players try jumping in the market this might change.
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Asif is a cryptocurrency enthusiast and journalist who’s been writing on the subject since 2014. He also has a keen interest in social engineering and cybersecurity. When not busy writing about cryptocurrency, he can be found reading books and listening to music. He holds an M.Sc in Life Science and an MBA in Finance & Banking.