Founded in 2013, Bithumb is a South Korean-based exchange with headquarters in Seoul’s Gangnam district. Bithumb is currently the largest cryptocurrency exchange in the world based on 24-hour transactional volume. At the time of writing our review, the exchange’s 24-hour trading volume was US$571,239,520 between Bitcoin Cash, Ethereum, and Bitcoin which makes up the majority of total trades respectively.
Currently, the only cryptocurrencies available on Bithumb are Bitcoin Cash, Ethereum, Bitcoin, Litecoin, Ripple, Ethereum Classic, Monero, and Dash. These cryptos can be traded against the South Korean Won (KRW), but not against one another. Bithumb offers the lowest trading fees of any South Korean exchange; fiat-to-crypto trading fees range from 0%-0.15%, depending on the trade amount.
Deposit & Withdrawal Fees
There are no fees for depositing currency on Bithumb, and withdrawal fees vary from currency to currency. For Ethereum, Dash, Litecoin, Ethereum Classic, and Ripple, withdrawals cost 0.01 of the corresponding currency; withdrawing KRW costs 1,000 Krw; Bitcoins withdrawals cost 0.0005 BTC. Bithumb can also be used to send international remittances in the form of Bitcoin or KRW. Interestingly, users can buy Bitcoin gift vouchers from the exchange which can then be exchanged for their corresponding amounts of Bitcoin.
History of Bithumb
The founding company behind Bithumb is called BTC Korea.com Co. Ltd. There is little information available from Bithumb or BTC Korea regarding their executives or employees, though. On their website, Kim Jae-Wook is listed as the current CEO of Bithumb, but there are no other members listed publicly.
Bithumb was the victim of a hacking attack on June 29, 2017 when a Bithumb employee’s home PC was compromised. The hacker was able to access the personal data of roughly 3% (31,800) of Bithumb users. Only some of those 31,800 users had funds stolen from their account. After the hack, Bithumb provided compensation in the amount of at least 100,000 KRW (~US$86.50) to each affected account. The amount of funds lost from each victimized account varied, but one user reported a loss of 10,000,000 KRW (~US$8700).
It is worthwhile to note that the Bithumb network itself was not compromised; had it not been for this employee’s computer, the hack would not have occurred. Though the hack was unfortunate and affected thousands of people, it can be said that the Bithumb network itself is relatively safe, especially for being one of the largest cryptocurrency exchanges in the world.
Registering on Bithumb
Bithumb supports both individual and corporate accounts. To register as a basic user on Bithumb, you must first start by providing your name and nationality. After that, users have to verify their cell phone and email address. The amount of trading that you will be allowed to do depend on the level of verification that you provide. There are four different trading account levels:
Level 1 requires only email and SMS verification. With a level 1 account, you can deposit an unlimited amount of virtual currency into your account, but no KRW. You can not buy or sell any currency as a level 1 user.
Level 2 requires further identification confirmation which includes everything from level 1, in addition to a cell phone, submission of the user’s passport, and I-PIN ID confirmation.
Level three requires all of the above in addition to a personal or corporate written pledge.
Level 4 requires all of the level 1-3 documents as well as proof of residence.
Bithumb Security and Support
Bithumb has 24/7 customer support that is available by email at email@example.com or by phone at +82 1661 5551. They also offer in-person consultation and support in Seoul. Additionally, there is a vast amount of support-related information on their FAQ page, but the English version of this page is somewhat limited. Bithumb uses two-factor SMS verification to protect user accounts. Transactional data on Bithumb is encrypted. Users can restrict transactions to specific wallet and IP addresses.
Bithumb and Arbitrage
Savvy Bitcoin traders have kept their eyes on the Bithumb exchange as a possible opportunity to make money off of Bitcoin arbitrage. Arbitrage is the practice of buying something at a lower price in one market and then selling it at a higher price in another. Bitcoin is usually marginally more expensive on Bithumb than it is on other exchanges.
For example, at the time of writing, 1 Bitcoin on Bittrex was priced at US$3854; 1 Bitcoin on Bithumb was valued at US$3862. US$8 is not a large amount of money, but a high volume of Bitcoins or even just a high number of trades could potentially bring in some serious profits.
However, doing this successfully may require a user to either have residency in South Korea or to have a partner with South Korean residency that they can trust with thousands of dollars of cryptocurrency.
Bithumb: Worth Your Time?
While Bithumb is still geared mostly toward its base of South Korean users, it is relatively easy to understand and operate for English-speaking users. With excellent user support and a reputable record of solving problems and providing compensation for exchange hacks or errors, Bithumb seems to be a worthwhile exchange. Bithumb is quite a large exchange, and its trading volume will undoubtedly continue to grow as more currencies are added to its platform.