Coinmama Review: Secure Crypto Investing With Payments

Finding a reputable cryptocurrency exchange can be difficult. It seems like every other day, a cryptocurrency exchange is getting hacked and user funds stolen in the process.

But Coinmama might offer a solution for those who are worried about the security of their coins. Coinmama doesn’t hold user coins, so there is nothing to steal. Plus, it allows users to buy cryptocurrency with a debit card, credit card, Apple Pay, or bank transfer, with instant coin delivery.

The cryptocurrency brokerage has been around since 2013 and has a good reputation. In this article, we’ll review Coinmama and go over what they have to offer.

Who Is Coinmama?

Coinmama is a cryptocurrency exchange. It was founded in 2013 and is registered in Slovakia but it was recently acquired by Wellfield, a German blockchain and finance technology company. Its founder is Nimrod Gruber. Coinmama has over 2.4 million customers spread out across 188 countries.

What Do They Offer?

Coinmama allows its customers to exchange fiat currency such as dollars or euros for cryptocurrency. You can’t trade cryptocurrencies with other traders.

Transactions on Coinmama are always fiat to crypto or crypto to fiat and from Coinmama’s inventory. From their FAQ:

Because there is no trading from crypto to crypto, you aren’t trading cryptocurrencies on Coinmama. Instead, you are simply buying and selling them directly from/to Coinmama.

Since Coinmama is actually selling coins instead rather than acting as a middle man, it can offer faster transactions. In fact, the moment you place your order, you get your coins instantly without any cash deposit requirement.

Supported Currencies

The following coins are available on Coinmama:

• Bitcoin
• Ethereum
• Litecoin
• Bitcoin Cash
• Qtum
• Ripple
• Ethereum Classic
• Cardano
• Tezos
• EOS

Payment Flexibility

Coinmama offers one of the widest varieties of payment options to its users. You can purchase cryptocurrencies on Coinmama using any of the following payment methods:

• Credit card
• Debit card
• Apple Pay
• Bank transfer

Coinmama was one of the first cryptocurrency exchanges to offer Bitcoin by credit card. After the initial account verification, purchased coins immediately go to your digital wallet. Note that you’ll need to already have a digital wallet that you use since Coinmama is not a wallet provider and doesn't hold coins for you.

High Spending Limits

With Coinmama, you could eventually qualify for a spending limit of up to $1 million. However, it doesn't allow someone to come in and buy $1 million worth of Bitcoin right off the bat. Instead, it breaks all of its users up into three account levels.

Everyone who opens a new account with Coinmama starts as a Level 1 user. Once you've purchased at least $2,400 in cryptocurrency on the site, you can apply for Level 2 status which has a spending limit of $50,000. And once you near that limit, you can apply for Level 3.

Here's a closer look at what each level offers:

Are There Any Fees?

Yes, there are fees for each transaction and they vary depending on your payment method. For buy orders, the prices you see on Coinmama will be based on the XBX + 2% (standard deviation) plus a commission fee up up to 3.90%. Additional fees based on payment type are:

• Credit/debit card: Additional 5% momentum fee
• SEPA bank transfer: No additional fee
• SWIFT bank transfer: No additional fee for orders above $1,000. Minimum fee of £20 on                 orders below 1,000 USD

For sell orders, fee are based on the XBX Index average + 2% (standard derivation) + a sell fee of 0.10-0.90%. When you select the amount that you want to sell, Coinmama will apply the following automatic feel calculations depending on whether you're a Crypto Curious, Enthusiast, or Believer .

• Curious: 2.9%
• Enthusiast: 2.5%
• Believer: 2.1%

Coinmama fees are higher than Coinbase, which is another very reputable exchange. Keep in mind that you’ll need to at least cover the fee cost to break even when selling your cryptocurrencies.

How Do I Open An Account?

You can visit the Coinmama website to get started. There are three steps before you can buy and sell coins on Coinmama.

1. Open an account
2. Verification — submit a government-issued ID and selfie.
3. Add crypto wallet

Some people have complained about the verification process taking a few tries before it finally works. Coinmama says that verification can take from a few minutes to up to 30 minutes.

Is My Money Safe?

Coinmama uses an encrypted website and payment transactions are also encrypted. No credit card information is stored on Coinmama’s website. In short, Coinmama is a secure website and you can feel confident in using it.

However, cryptocurrency exchanges are prime targets for hacking attempts and Coinmama is no exception. On February 15, 2019, Coinmama was hacked as part of a larger hacking operation that targeted various industries.

Thankfully, these thieves made off with only email addresses and hashed passwords of older user accounts. Coinmama immediately notified its users about the incident and had them all change their passwords.

It makes sense that no cryptocurrency was stolen from Coinmama. It doesn't have any user coins stolen available to steal as it doesn't offer custody (storage) service. Instead, all user coins are immediately sent to their own addresses (digital wallets).

Related: The Top Crypto Savings Accounts

Is It Worth It?

If you're ok with buying and selling coins directly from Coinmama, it offers a lot of benefits. You get instant coin delivery, multiple payment options, and high spending limits. 

Plus, since Coinmama is a non-custodial cryptocurrency broker, you'll never to worry about a data breach causing you to lose your coins.

However, if you're looking to trade cryptocurrency with other individuals, Coinmama won't be the right crypto investing website for you. Instead, you'll want to look other sites like Coinbase, Gemini, or eToro. For more options, check out our full list of top cryptocurrency exchanges.

Coinmama Features