Coinmama Review – My Personal Experience & Thoughts

Introduction

Coinmama is a cryptocurrency platform registered in Slovakia that is currently available to users in 188 countries. It sells eight different cryptocurrencies including bitcoin. If you are new to cryptocurrency exchanges, you should be aware that there are three main types of exchange.

• Trading platforms: Trading platforms allow buyers and sellers to conduct instant trades with one another on the exchange and collect a fee for doing so. These platforms are usually highly liquid and the prices are constantly changing. Trading platforms typically offer advanced order options (like limit and stop orders) as well as advanced charting.
• Cryptocurrency marketplace: In a cryptocurrency marketplace, the sellers set their own prices (sometimes called “advertisements”) and trade directly with buyers. Typically, the exchange acts as an intermediary or escrow service that verifies deposits and ensures each party gets what they are due. These types of trades are not typically instant and can take hours to days to complete.
• Brokers: Cryptocurrency brokers set their own prices and charge a fee for their service.

Coinmama is a broker that lets anyone register and start using fiat currencies to buy cryptocurrencies. There are several different types of broker cryptocurrency exchanges:

• Trading platforms: Trading platforms allow buyers and sellers to conduct instant trades with one another on the exchange and collect a fee for doing so. These platforms are usually highly liquid and the prices are constantly changing. Trading platforms typically offer advanced order options (like limit and stop orders) as well as advanced charting.
• Cryptocurrency marketplace: In a cryptocurrency marketplace, the sellers set their own prices (sometimes called “advertisements”) and trade directly with buyers. Typically, the exchange acts as an intermediary or escrow service that verifies deposits and ensures each party gets what they are due. These types of trades are not typically instant and can take hours to days to complete.
• Brokers: Cryptocurrency brokers set their own prices and charge a fee for their service.

Coinmama is a fiat-only exchange and is not a wallet service. In this article we will be covering everything you need to know about this exchange.

What is Coinmama?

Coinmama is a cryptocurrency exchange based in Bratislava, Slovakia. It was created in 2013 and is trusted by over 1,000,000 people across 188 countries. Coinmama only processes buy orders for cryptocurrency and is not a wallet service. It accepts any credit or debit card from VISA or MasterCard. However, not all functions of the site are available in all countries. The CoinMama website is available in English, French, German, Italian and Russian.

Fast transactions

It is best known for extremely fast transaction times. Cryptocurrencies are sent immediately after both your payment and wallet address have been confirmed. Coinmama is not designed for trading coins, and simply sends the cryptocurrency you buy to any wallet you choose. Users need to create their own secure digital wallet to safely store their cryptocurrencies.

No wallet service

Unlike other cryptocurrency broker platforms, Coinmama does not buy back any cryptocurrencies, nor does it store any coins. Users cannot store any cryptocurrencies as they do not provide a wallet service. To date, there have been no reported hacks of Coinmama, primarily due to the fact that it does not store customer deposits. All user data is encrypted and the credit and debit card details of users is not stored by the exchange.

Watch for scams

The official Coinmama website does warm customers about various common scams and how to avoid them and protect yourself against fraud. Most recently, they warned customers that “an unknown group of people have made a business of misrepresenting exchanges by providing so-called phone support in those companies’ names.” This type of phone support scam is not an indication of a security breach or hack.

What we like and dislike

Commission and Fees

Coinmama charges higher fees compared with comparable exchange however it offers a higher level of convenience. You can make purchases with credit and debit cards (if permitted by your issuing bank). Transactions are completed very quickly and your card details are not passed on to Coinmama.

• Deposits – Coinmama does not allow deposits as it isn’t a wallet service. It simply sends cryptocurrencies to a wallet address of your choosing.
• Trading commissions – No trading commissions since they offer buy orders only.
• Withdrawal Fees – There are no withdrawal fees. When you make a purchase, you are charged 5.50% and your cryptocurrency is sent to your wallet instantly. There is an additional 5.00% fee for credit/debit card transactions, charged by the payment processor. Banks may charge additional fees as some banks classify cryptocurrency purchases are cash withdrawals.

Coinmama is best for

If you want a quick and convenient way of buying Bitcoin, Etherum and other major cryptocurrencies, Coinmama offers a very fast service. However, other broker exchanges such as Coinbase are simpler for beginners as they offer all-in-one solutions where wallets are automatically created for the customers.

Wallet learning curve

Although Coinmama’s FAQ page explains how to download a Bitcoin wallet for free, or an Ethereum wallet, beginners might be puzzled about how to get a wallet for the other six cryptocurrencies offered (Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), Cardano (ADA), Qtum (QTUM) and Ethereum Classic (ETC)).

One benefit of this is it gets beginners into the habit of storing their coins in secure electronic wallets. Many newcomers to crypto rely on exchange based wallets. This is normally not recommend since exchanges are frequently subject to attacks or hacking attempts. Private wallets are much more secure.

Sign up & Privacy

Coinmama is extremely easy to register with and it takes a matter of minutes to submit supporting documents and finalize your account.

To get started, you need an email address to confirm your account. To get your account verified, click on the confirmation link in the email and you’ll see your account page. Click on ‘Verify my account’ to proceed to KYC verification. You’ll need to upload two documents:

1. A scan of a valid government ID (such as a driver’s licence, a passport (not for US customers) or a national ID card.
2. A selfie of you holding the ID and a piece of paper bearing the current data and the word ‘Coinmama’.

Once verified, you’ll be able to buy – in total – up to 15,000 USD worth of bitcoin with credit/debit card.

There are three verification levels. For higher daily & monthly spending caps, you can submit additional documents for Level 2 and Level 3 verification.

User data encryption

All user data is fully encrypted, and Coinmama, being based in the EU, is committed to becoming fully GDPR compliant. The EU General Data Protection Regulation (GDPR) grants individuals far higher levels of data protection than are offered outside the EU. As of May 25, 2018, Coinmama customers are able to see exactly how their data is used.

Deposits & Withdrawals

Since they offer buy orders only, there are no deposits or withdrawals. Coinmama offers speed and convenience for anyone wanting to buy cryptocurrencies with a credit or debit card.

They send the cryptocurrency instantly after your payment and wallet address are confirmed.

Account Limits

Coinmama is a limited cryptocurrency broker and is not an all-in-one solution. There are no deposit or withdrawal limits, only buy limits.

There are 3 account levels with increasing limits, each requiring additional verification:

• Level 1 – Upload your government ID & a selfie – Buy up to $15,000
• Level 2 – Upload a secondary ID (utility bill, etc.) – Buy up to $50,000
• Level 3 – Filling out a form from Coinmama – Buy up to $1,000,000

Security

In terms of front-end security features for users, Coinmama doesn’t encourage you to set up 2 factor authorization (2FA) as some other exchanges do. Part of the reason for this is that customers cannot store cryptocurrencies on the site.

In terms of back-end security, they do not see or store the payment details of their customers. It does not store users’ funds. When you buy cryptocurrencies from Coinmama, you are purchasing from the companies’ own supply, held largely in cold-storage wallets (ie. wallets that are not connected to the internet). Funds are only moved to hot wallets as required.

Security History

There have been no reported hacks of this exchange. Although Coinmama recently warned customers about a phone support scam, this was not related to a hack or security breach. This was a case of criminals fraudulently using the exchange’s name in an attempt to con users into giving their public wallet keys.

Cryptocurrencies Supported

Besides Bitcoin and Ethereum, they offer Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), Cardano (ADA), Qtum (QTUM) and Ethereum Classic (ETC). They do not have a set schedule for adding new coins.

Trading platform

Coinmama offers no trading facilities, it is buy-only. If you are looking for an exchange that you can hold your cryptocurrency on and trade for other coins, we recommend Binance.

Ease of use

Coinmama is not a full service crypto exchange like Coinbase and does not provide online wallets. Newcomers may be put off by having to create their own cryptocurrency wallet prior to using Coinmama.

However, this is fully explained in the FAQ section and the instructions are very simple to understand and follow. Once users have their own wallet, Coinmama is very simple and convenient to use.

Customer Service

Live chats are available during business hours and customers can contact the support team by submitting a request, sending an email or via their Facebook page.

Mobile App

Coinmama has no official mobile app. But their website is very mobile friendly. We tested the entire site from an iPhone and it worked great.

Common Questions

• Is Coinmama safe?
  Yes. User data is encrypted. Coinmama doesn’t see or store your payment details. It is becoming fully GDPR compliant meaning users can see exactly how their data is used.
• Can I use a bank account or credit card?
  No bank account transfers but you can use a debit or credit card.
• Is Coinmama decentralized?
  No. It is registered in Bratislava, Slovakia but operated from Israel by a single company.
• Can I use Coinmama as a wallet?
  No, it is not a wallet service. You need to use your own wallet. Full instructions for downloading a bitcoin or ethereum wallet are given on Coinmama’s FAQ.
• Is Coinmama open to new registrations?
  Yes. It is available in 188 countries.

Countries Support

188 countries are currently supported, according to the official support page here.

Conclusion

Coinmama is a trusted exchange with a good reputation. It is pricey but offers great convenience. For a long time, it offered only bitcoin but has recently expanded to offer other cryptocurrencies. This shows growing demand and support for the service.