Before we get this review going, let us put it forth that – despite scores of complaints here and there – itBit is indeed a legitimate Bitcoin trading/OTC trading desk service. That said, the community does not seem to like the operation much. itBit’s fee structure is apparently unattractive, and its withdrawal handling has racked up a bad reputation, as did the way its support crew handles such problems.
With all that, itBit is regulated in the US and it is apparently the only US-chartered Bitcoin exchange that complies with US and New York law. itBit is apparently also the first US Bitcoin bank, though there is some confusion surrounding its practicality in this regard.
What is itBit then?
According to their own definition from the About Us page of their site, itBit’s services are comprised of two main parts: their Bitcoin exchange and their OTC Agency Trading Desk.
The exchange is destined to the buying and selling of Bitcoin, by retail and institutional clients, in a secure way, while taking advantage of deep liquidity and allegedly low fees. As said above, the opinions of the community differ on the issue of fees.
Apparently, the client network of the operator covers some 100 countries, which means that the depths of the order book of the exchange are more than satisfactory.
The loathed fee structure does not charge makers in any shape or form. Takers on the other hand are charged quite a bit, even though these fees allegedly decrease as one’s trading volume increases.
For institutions and high-volume traders, itBit offers a powerful suite of API services.
As it is obvious from the above intro, itBit is focused on the needs of US Bitcoin traders. As such, it gives such traders full FDIC insurance, as well as full Bitcoin asset protection. In addition to that, fiat deposits made by US clients are kept only in regulated US-based banks, and year-end 1099 forms are provided for such clients, for tax-reporting purposes.
Being a trust company offers itBit certain advantages when it comes to getting hooked up with leading financial institutions in the US and world-over. Institutional traders are treated to personalized support at itBit.com, as well as extra-low trading fees (whatever that may translate to, on an individual basis).
Active traders at the exchange are rewarded in a rather similar manner. In order to gain access to the reduced fees and the personalized service though, such traders need to log a trading volume of at least 2,500 bitcoins per month, which – for most – is obviously not easy to achieve.
The wallets of the exchange users are kept in cold-storage, while the platform itself is DDoS attack-protected.
The OTC Trading Desk is a service dedicated to high-volume traders. While personalized support and a deep order book are available by default, the service only handles trades involving over 100 bitcoins.
The fee structure for this service is indeed as simple as it could possibly be: there’s a flat fee of 0.10% charged on every transaction.
To register for the service, traders are required to complete a form available in the OTC section of the itBit website.
Can I Trust itBit?
This question is surprisingly difficult to answer in this instance. The site is legitimate beyond the shadow of a doubt, in the sense that it is regulated and compliant with US law. It does not actually seem to resort to stealing clients’ funds either, though its withdrawal procedures have driven many to exasperation.
The community does not seem to like the operation and there are many who would tell you not to trust it.
Question Marks and Red Flags
As said above, the site/operation itself looks legit. The only red flags are in the user feedback, which is surprisingly bad.
This is where things take a big southward turn for this operator. There are several itBit threads on bitcointalk, and neither of them leave a favorable aftertaste.
One such thread (granted, a not very long one) proclaims the exchange a scam. Apparently, the poster claims that he/she was not able to withdraw funds from the exchange, even though the site allegedly processes Bitcoin withdrawals several times a day. The complaint is accompanied by a number of screenshots showing how the funds are indeed stuck in limbo for several days. By contrast, the user’s deposit was allegedly processed within a couple of hours. Though the thread is indeed short and the problem may be a one-off fluke, the silence following the proof delivered by the poster, is truly deafening…
Another thread discusses why – despite being legitimate – itBit is not within the top 5 Bitcoin exchanges. The conclusion is that it has developed a bad reputation on the support- and fee-side.
Other complaints target much more serious issues. One of their users has apparently had some of his bitcoins simply stolen from the site, amid withdrawal limit increases and account-blockings. The said user had apparently bought 15 bitcoins for $25,000 at the exchange, before his problems with the withdrawals started. Later, as a result of his bitcointalk post, his account was apparently unblocked.
While there’s less feedback about itBit on Reddit, the vibe over there seems to be a bit more favorable. Still, there are complaints about unanswered support emails and accounts blocked due to identity verification failures.
As of November 29, 2017, itBit.com had a SimilarWeb global rank of 333,423 and 151,621 in the United States. Besides the US, the exchange is slightly popular in Singapore, Thailand, the United Kindgom and Turkey.
itBit Review Conclusion
While itBit is indeed a regulated and legitimate operation, its practices are suspicious here and there. This is not an exchange that will simply take your money and run. That much is quite clear. It might procrastinate your withdrawals though and apparently, it may even shortchange you every now and then.
Its identity verification requirements are very stringent, stringent enough in fact to put off scores of potential clients by virtue of this fact alone. Its support should be much more responsive and it should really do something about its fees, which are way too steep for the majority of rank-and-file users.
We shouldn’t forget though, that there are people out there who are actually happy with the service.
To be on the safe side, we’d recommend choosing a different Bitcoin exchange. If you’re living in the US, then Coinbase would seem to be the best choice. At least that’s where we choose to keep our bitcoins.
Please provide us with any feedback – positive or negative – regarding itBit by leaving a comment below this review.