What is Coinmama?
Coinmama is a global online marketplace designed to make it as straightforward as possible to buy digital currency. Founded in 2013, it’s helped more than 1 million people in 188 countries buy crypto coins and tokens using fiat currency. Coinmama is a subsidiary of Slovakian company NBV International s.r.o., which is based in Bratislava and is a daughter company of money service business New Bit Ventures Ltd.
You can buy Bitcoin and other currencies on Coinmama by completing the following steps:
- Register for an account. You’ll need to provide your name, email address, country of residence and proof of ID.
- Enter transaction details. Specify which digital currency you want to buy and how much you want to purchase.
- Choose your payment method. Select the credit or debit card you will use to pay for the transaction.
- Fill out the payment form. Provide your card details and follow the prompts.
- Complete payment. The final step is to submit your payment and confirm your cryptocurrency wallet address.
Which cryptocurrencies can I buy and sell?
Coinmama users can buy 7 cryptocurrencies through the platform:
- Bitcoin (BTC)
- Ether (ETH)
- Litecoin (LTC)
- Bitcoin Cash (BCH)
- Cardano (ADA)
- Qtum (QTUM)
- Ethereum Classic (ETC)
- Ripple (XRP)
Coinmama users in many locations can also sell Bitcoin through Coinmama with high limits and 0% processing fees to receive money directly to their bank account.
Coinmama is currently available in more than 180 countries worldwide, including Australia, and it also accepts all local currencies. A full list of supported countries is available on the Coinmama website.
Which payment methods are accepted?
- Cash (via Western Union transfer)
- SEPA (Single Euro Payments Area)
Coinmama supports Visa and Mastercard credit or debit cards via the Simplex payment system. If you are paying by cash, you must use Western Union. SEPA, a payment-integration initiative of the European Union for the simplification of bank transfers denominated in the euro, is also an option. Coinmama does not let you link your bank account or support other wire transfers.
How much will it cost me to use Coinmama?
The company charges a 6.3% transaction fee for each purchase. If buying with a credit card, there is an additional 5% fee assessed by Simplex, Coinmama’s credit card processor.
|Credit card purchase fee||5%|
|Cash advance fee*||*|
*Note: According to Coinmama, some banks and credit card issuers consider buying Bitcoin to be the same as a cash advance and will charge users hefty fees to expedite the transaction. This is not a Coinmama fee. Make sure your credit card doesn’t add on any cash advance fees when you buy Bitcoin. If they do, dispute it, which just might get you a refund.
Let’s consider the actual cost to you if you wanted to buy US$1,000 worth of Bitcoin through Coinmama. (FYI, at the time of writing in September 2017, the price of one Bitcoin is just above US$4,500.)
|Credit card purchase fee||5%||US$50|
|SEPA bank transfer||0%||US$0|
|Exchange rate fee||Coinmama prices are set in USD and euros. If you are using another currency, your bank or credit card may assess a currency exchange fee.||Unknown|
|TOTAL KNOWN COST||US$1,105|
It will cost you at least US$1,105 to buy US$1,000 worth of Bitcoin using Coinmama. It might even be more if you are assessed a cash advance fee or a fee for using a currency other than US dollars or euros – like GBP.
* This is a fictional, but realistic, example.
What is a rate lock?
The price of Bitcoin can fluctuate wildly. So much so, that some sellers may actually change your order even after the transaction is registered. This is not the case with Coinmama. Coinmama “locks” the crypto rate at the time of purchase. This means you will receive exactly the number of Bitcoin you ordered, regardless of whether the price went up (or down) between the time you placed the order and when you receive your coins. However, this purchase assurance comes with a cost. Coinmama’s price, while competitive, is typically not the lowest out there.
How soon can I get my Bitcoin?
It can typically take a few hours until you receive your Bitcoin, despite the straightforward process. First, it can take the blockchain a few minutes to confirm a transaction. This wait time occurs no matter who you buy your Bitcoin from. Then, your credit card issuer, or Western Union if you’re using cash, may take up to several hours to confirm payment. Lastly, Coinmama won’t send your coins until you’ve confirmed your digital wallet address. In summary, the following factors will dictate how quickly you will receive your Bitcoin.
- Time for the bank or credit card processor to verify the funds
- Time for you to confirm your digital wallet address
- Time for the blockchain to confirm each transaction
Fortunately, Coinmama is selling from its personal holdings, unlike other service providers or brokers, and this significantly expedites processing time.
Are there any transaction limits?
Coinmama has limits based on cash purchase, credit card purchase and verification status. There is a daily limit of 5,000 USD/EUR per day, whether paying with cash by Western Union transfer or credit card. If you are paying with a credit card, you are limited to 20,000 USD/EUR per month.
What about lifetime purchase limits?
Coinmama places limits based on what it terms “verification levels”. There are 3 levels:
- Level 1: US$10,000 limit
- Level 2: US$50,000 limit
- Level 3: No limit
For Level 1 status, Coinmama requires each user’s name, address, date of birth, email, phone number and a photocopy of a verifying document, typically a passport or national ID or government-issued driver’s licence. It can take Coinmama from several hours up to an entire day to review your documents and verify your status.
If you want to purchase more than US$10,000 in Bitcoin – Level 2 status – you must provide a copy of both your passport and driver’s licence or similar identifying documents. Coinmama may even require you to upload a selfie of yourself holding these documents.
Ready to go bigger? Level 3 status has no total purchase limits. To get to Level 3, you must contact Coinmama support directly and it will provide further instructions.
Note: Total purchase limits based on verification levels do not alter the daily and monthly spending caps.
Is there a minimum purchase?
Yes, the minimum you can buy is US$60 although the lowest amount of Bitcoin Coinmama sells is 0.1 Bitcoin, which is currently priced above US$60. This effectively means the minimum purchase is the listed price of 0.1 Bitcoin.
Is it safe to use Coinmama?
Coinmama is registered in both Israel and Ireland. Since it has no entity in the UK, you won’t find it on the Financial Conduct Authority’s cryptoasset register.
The company has been offering Bitcoin for sale for several years. Coinmama is considered a reputable place to transact Bitcoin purchases; however, as with all things digital – particularly with everything crypto – there is always an element of risk.
Coinmama offers support via email only; however, the site’s FAQ and service desk support documents are reasonably comprehensive and easy to understand.
Coinmama pros and cons
- Live pricing in US dollars and euros
- Buy fractions of a Bitcoin
- Easy to review all your orders
- Buy direct from the site – no middleman
- Multi-language site
- Does not accept PayPal, American Express or Discover
- Can’t link to your bank account to expedite new purchases
- No smartphone app
Compare Coinmama against other exchanges
Table: shows partner brands and other brands, sorted by popularity
Crypto is unregulated in the UK; there's no consumer protection; value can rise or fall; tax on profits may apply*.
To get started with Coinmama, register for an account on the platform’s website. It’s then just a matter of choosing which cryptocurrency you’d like to buy, completing payment and confirming your wallet address.
Before buying Bitcoin – or any digital currency – you will also need to have a secure digital wallet. Once this is completed, you can store your Bitcoins there and use this wallet to purchase goods and services online. It’s also useful to learn more about Bitcoin and blockchain.
Image source: Coinmama
*Cryptocurrencies aren't regulated in the UK and there's no protection from the Financial Ombudsman or the Financial Services Compensation Scheme. Your capital is at risk. Capital gains tax on profits may apply.
Cryptocurrencies are speculative and investing in them involves significant risks - they're highly volatile, vulnerable to hacking and sensitive to secondary activity. The value of investments can fall as well as rise and you may get back less than you invested. Past performance is no guarantee of future results. This content shouldn't be interpreted as a recommendation to invest. Before you invest, you should get advice and decide whether the potential return outweighs the risks. Finder, or the author, may have holdings in the cryptocurrencies discussed.