Some cryptocurrency exchanges are gateways between the fiat currencies of the world and the world of cryptocurrencies, while others are only places where you can trade one crypto token for another. Some exchanges are big sites that almost everyone is familiar with, like Binance, Coinbase, or Kraken. Others are little known outside their home territories. Some are beginner-friendly, while others can seem daunting even to seasoned traders. One of the names you may have come across while reading about crypto trading is itBit. This article is an itBit review for 2020, so read along to find out whether ItBit is right for you.
What is itBit?
With headquarters in New York and an international office in Singapore, itBit exchange launched in 2013 as a brokerage service allowing users to buy Bitcoin with fiat currency. In 2015 they obtained a charter from the New York State Department of Financial Services, making them the first regulated Bitcoin Exchange in the US. ItBit is now fully regulated as a bank in the state of New York, which allows them to offer exchange services in all 50 states. Not many exchanges can offer this.
Is itBit legit?
ItBit was the first regulated cryptocurrency exchange in the US and is currently under full regulation as a bank in the state of New York. So ItBit is as legit as you can get.
Who is itBit for?
If you check out the ItBit website, they repeatedly state their main target: institutions and active cryptocurrency traders. ItBit allows you to buy Bitcoin both through their exchange and through an OTC desk, but OTC purchases start at 100,000 USD. So if you are looking to buy large amounts of Bitcoin, then ItBit is definitely a good option for you. But if you just want to buy a few dollars’ worths of Bitcoin, looking to buy an altcoin or do some crypto token trading, then it’s best if you look elsewhere.
What does itBit offer?
ItBit offers traders several features to make their transactions fast and secure. No ItBit review can be complete without a look at some of the more important ones, so here we go:
ItBit offers several APIs to integrate their crypto assets market data into your trading or investment programs.
They offer FIX (Financial Information eXchange). The FIX API is geared towards institutions and high-frequency traders. FIX provides solutions for institutions, algorithmic traders, and active traders.
There’s also the REST API. REST is an HTTP-based API that offers full trading functionality for algorithmic trading or algorithmic market analysis. This is a Public API for retrieving market data from the exchange and no authentication is required.
Finally, there’s Market Data API, which is a REST API used to access ItBit's order books, pricing data, and trade data. This is also a Public API for retrieving market data from the exchange and no authentication is required.
Coin selection on ItBit is very limited. ItBit wasn’t launched as a crypto exchange; it’s a brokerage service that lets you buy Bitcoin, so there never was any intention of offering a wide selection of altcoins.
On ItBit's exchange, you can buy Bitcoin (XBT) with US dollars (USD), Euro (EUR), and Singapore dollars (SGD). OTC Bitcoin purchases can be made with ETH, BCH, LTC, XLM, PAX, BUSD, PAXG, and USDT.
OTC Trading Desk
ItBit offers an over-the-counter trading desk for buying Bitcoin with fiat currencies and some other cryptocurrencies. Transactions are generally fast; most are settled within a day. There are a flat transaction fee and no withdrawal fees. However, keep in mind the minimum transaction on the OTC desk is 100,000 USD.
FDIC means that all accounts are insured up to $250,000. ItBit has gone to great lengths to monitor and protect investors and traders, addressing issues that pose risks to the exchange. This isn't too common in the crypto ecosystem and hats off to ItBit for their preventive measures. That being said, while insurance of 250,000 USD sounds like a lot for the novice, low-volume traders, we have to keep in mind that these aren't ItBit's target. For companies and traders that can have millions of dollars' worth of Bitcoin on ItBit, the insured amount isn't that impressive at all.
ItBit is very big on security. From the moment you create an account, you will be prompted to enable 2FA (two-factor authentication). While this isn’t unusual among crypto exchanges, ItBit takes this a bit further as its security protocols cover all sectors of the exchange. ItBit employs multiple layers of security, trying to set the standard for the safest exchange in the industry. They claim to protect the trading platform from DDoS attack using the SSL protocol, 2FA, and full encryption.
ItBit protects 100% of its customer's crypto assets by using secured offline cold storage wallets. The staff has to comply with mandatory background checks and compliance training.
When ItBit received a charter from the NYSDFS (New York State Department of Financial Services) in 2015, it became the first regulated crypto exchange in the United States. ItBit is fully regulated as a bank in New York and this allows them to offer their services in all 50 states.
If there is one consequence of regulation that could be seen as a drawback by some traders is that you can forget about anonymous trading on ItBit. KYC is mandatory and more detailed than on other exchanges. Users need to provide identification and proof of residence. It's also slower than other exchanges… KYC verification will take about a week and you can't make any purchases or trades until it’s completed.
Depositing fiat currency to ItBit is on the expensive side. Depositing USD into your account has the following costs; domestic wire transfers cost $10 + agent fees (if any), international wire transfer costs $25 + agent fees (if any).
ItBit withdrawal fees are the following: ACH transfers (up to and including $3,000) are free, domestic wire transfers (exceeding $3,000) cost $20 + agent fees (if any). International wire transfers are $40 + agent fees (if any).
Trading fees have a simple structure: taker fee is 0.35% and maker fee is 0.03%. Special fees are available, but you need to be trading over 25 BTC to be eligible. This is one of the reasons ItBit is better suited for institutions and other high-volume traders.
What about alternatives to itBit?
This ItBit review has pointed out that high-volume traders can really take advantage of ItBit's features. But it’s definitely not for everyone. If you just want to buy a few dollars’ worths of Bitcoin, are looking to start cryptocurrency trading, want to buy EOS, ADA or any other altcoin or if you simply want to stay anonymous (and a lot of holders of high amounts of Bitcoin certainly want to keep a low profile), then you want to look elsewhere.
Coinbase, Stormgain, and Kraken are good starting points for beginners wanting to buy their first tokens. The first two offer some nice videos and how-to guides that teach the basics of crypto trading. If you want a larger selection of tokens and still have a user interface that isn’t too daunting, then Binance is a fine choice. For those who want to keep a low profile, Coinswitch allows you to buy and trade crypto without even creating an account on any exchange.
itBit Review: Conclusion
ItBit is considered one of the top cryptocurrency exchanges. And after reading this itBit review you can see their reputation is certainly well deserved. Both ItBit’s exchange and OTC desk are easy-to-use, fast, secure, and reliable platforms for buying Bitcoin. That being said, we can’t forget the fact that ItBit isn’t targeted towards occasional or low-volume, low-frequency traders. If you are just looking to invest a couple of hundred dollars into cryptocurrency trading, then you definitely want to look at an alternative. But if you are looking to buy or sell several million dollars' worths of BTC, first of all, let me congratulate you. Second, let me tell you that ItBit is a fine choice for your transaction.
Ease of Use
- Highly secure; has yet to be hacked.
- Fully regulated as a bank.
- Can offer services in all US states.
- Easy to use interface.
- FDIC insurance for all accounts.
- Regulation means more invasive KYC requirements.
- Not especially suitable for low-volume buyers.
- Fees are on the higher side.
- No cryptocurrency trading.
- No margin trading or short selling.
- No ACH transfers.
- No mobile app.