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BitFinex Review – Is BitFinex Scam or Legit?

BitFinex Exchange Rating
Read our Bitfinex review and learn why we recommend this exchange for online trading and why it is not a scam, learn all you need to know in this Bitfinex review before you sign up with the exchange.
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BitFinex Review

BitFinex logo

The blockchain economy is still at a very nascent stage as there are still several ongoing developments geared towards taking the technological movement mainstream. Cryptocurrencies, which are powered by blockchain models, seem to have found a place to call home in exchange platforms where tokens from the assets class can be traded/swapped among the users. But for some reason, there has been an entry challenge. Hence at Tokenhell, we always take it upon us to review such platforms after due research so that our readers and external visitors can make better-informed decisions about them. In this article, we will be embarking on a review of the BitFinex Exchange platform. That would give you some insight in case you ever want to trade with the platform.

A lot goes on in the crypto universe, and as records have shown, everyone who has been a part of this ecosystem’s journey (or joined somewhere along the way) has smiled to the bank (and continues to cash out). But the potential risk for losses in the space is as massive as the potential profits traders stand to make each day.

So whether you are a newbie or an established veteran familiar with the sort of pulse that drives this sector, one thing you must do is to ensure you don’t get out-paced or overwhelmed with the bucket loads of changes and remodifications that are commonplace here. One way to do this is to get yourself a reliable exchange platform that doesn’t only do the work of a “broker” but stays with you as a “trade partner”.

From providing daily charts to tracking price movements, and real-time updates for staying in tune with market trends, a reliable exchange platform should be able to aid you with the bulk of what you need to do to succeed on your crypto investment journey.


Thus, for this review, our focus would not just be on what BitFinex Exchange offers but also what a trader should look out for when rating a crypto exchange. Let’s get started.

Form of tradeMargin trading, lending, OTC, and spot.
AssetsBitcoins, Ethereum, Monero, and other altcoins
Learning materialsNo.
Trading toolsMarket summary, graphical charts, financial news updates, etc.
Fiat currencyUSD, EUR, JPY, GBP
Trading platformMobile, desktop, and on-site
Available assets80+
Extra fees charge?No
Customer support24 hours a day and seven days a week
Headquarter locationHong Kong, China

Introducing BitFinex Exchange

Initially operating in the British Virgin Islands before relocating headquarters to Hong Kong, BitFinex was established in 2019 by IFinex Incorporation- which lately has been involved in several litigations. At its inception, it was set up to function primarily as a p2p lending site solely focused on Bitcoin before the said assets started receiving global recognition.

BitFinex website

Later, more cryptocurrencies were added to the list. Thus, BitFinex is a pioneer “blockchain bank” older than the popular exchanges nowadays such as Binance, Okex, Kucoin, etc.

The early dark days of BitFinex

  • Hacks perpetrated on BitFinex

In its early days, BitFinex was repeatedly at the center of several crypto-related hacks and allegations. Notably, in May 2015, 1500 BTCs were reportedly stolen on the exchange.

Also, in the same year, the accounts of users were compromised – with the total recorded losses amounting to $400,000.

Then, on the year after (2016), a similar incident occurred as $72 million worth (119,756 BTCs)  of Bitcoin got stolen from customers’ segregated accounts, representing the most far-reaching Bitcoin theft ever, second only to the Mt. Gos Bitcoin heist. In reaction to the news, the price of Bitcoin, trading at the time for about $2000, slumped by 20%.

In response to the back and also as an attempt to reassure users confidence in its control of the situation, BitFinex distributed the loss evenly to all registered users – while at the same time “airdropping” BFX tokens. The BFX tokens were intended to serve as proofs as a year later, all who held their BFX holdings had their loss fully restored with the corresponding value.

To date, there have been no reported breach cases on the exchange. However, in 2018, the company was fined $75,000 by the U.S Commodities Futures Trading Commission in allegation of conducting off-site transactions for commodities without registering as a Futures Commission Merchant. 

  • BitFinex and Tether Limited

BitFinex has strong ties with Tether Limited, the firm behind the USDT stablecoin. The relationship between them, however, has been mired with controversies.

On May 29, 2019,  the Attorney-General for New York accused BitFinex of moving $850 million of Tether reserves as an attempt to atone the loss of the payment gateway, Crypto Capital. According to the allegation documents, the act was BitFinex’s attempt to seek an alternate solution, as it was unable to secure custodial services with a bank. The attorney -James – also said BitFinex had no signed agreement with Crypto Capital, nor was it aware that Crypto Capital had run away with the funds.

In response, BitFinex released an open letter to the public where it denied the charges, insisting the accusations are false.

According to research published in the New York Times, BitFinex allowed the use of “wash trading” by front runners to inflate Bitcoins price during the 2017 bull run season- a claim which BitFinex management has vehemently denied.

  • BitFinex Founders

BitFinex was founded by Giancarlo Devasini and Raphael Nicolle, an IT expert. After several heists were reported on the exchange, Raphael left his position as an executive member of the team in 2016, and he was quoted saying he was “leaving it in the capable hands of a good team.”

Then, in 2018, Chief Strategy Officer of BitFinex, Phil Potter, cut all ties with the exchange, citing his United States citizenship and the exchange’s troubling dealings in the country as the rationale behind the action. At the time, BitFinex was the fourth biggest crypto exchanging site by trade volumes, amassing profits of about $418 million. He was immediately replaced by an executive member of the management, JL van der Velde.

  • BitFinex struggle for a banking relationship

It was also well-publicized that the exchange has furtively strived to strike a stable banking relationship with several financial institutions. In April 2017, all of BitFinex’s bank accounts with Wells Fargo got frozen.

The turbulent situation persisted for weeks, generating fears and accusations from different quarters. It also affected BitFinex pricing. In the end, the matter was resolved –

albeit a permanent restriction was placed to prohibit customers from the United States from trading on the platform. Citizens from other countries are allowed to use its services.

Shortly after, in another phase of BitFinex’s search for funds custodial services with a bank, Taiwanese Bank deactivated all internationally wired transaction services it previously enabled for BitFinex. Then in September 2018, Puerto Rican bank, Nobel International, terminated its banking relationship with BitFinex as it started facing its own issues.

Perhaps all of these led to BitFinex’s present decision to keep 99.5% of customers’ deposits in cold storage facilities, with the remaining 0.5% stored in hot wallets to maintain the necessary liquidity on the exchange.

BitFinex’s present outlook: the Features

  • The interface and the order book

As a trader, it is essential to monitor the liquidity of an exchange before you key into its services. High liquidity will not only enable you to switch to-and-fro fiat and crypto, but it also ensures the price difference between the buy and sell order books stays within a few pips. This difference is also known as the spread.

That said, BitFinex order book probably has the highest liquidity compared to most exchanges in the world.

Also, the exchanges trading platform offers advanced features with a graphical user interface (GUI) that can be personalized. There are also over 50 currency pairs accessible via various order types, including stop-limit, market, scalable orders, limit, trailing stop, etc.

BitFinex also boasts sophisticated charts with complex calibrations that would probably be appreciated only by advanced trade experts.  Users can also utilize API functionalities to further enhance their interaction with the platform.

  •  Trade margins and zero funding

For a long while, the forex market remained the dominant market globally and continued to be so as brokers continued to widen the margin or gap in their leverage offerings. Crypto trading has grown to replicate every aspect of it with an even more- zero-funding mechanism which makes it possible for ambitious traders to have their accounts through loans derived from the Capitals of non-traders.

BitFinex combines both- investors can borrow and trade with a more widened leverage (3.3 times the conventional leverage) through the peer-to-peer margin trading platform. The interest, amount, and tenure duration of the lent funds will be determined by the user or automatically calculated by BitFinex algorithms. 

In return, lenders can earn interest without risking any possible loss as the capitals are securely covered. And for the entire duration of the loan, funds providers will not be able to access their capital as they stay locked.

Unlike other exchanges, BitFinex allows borrowers to lend their assets in any form of cryptocurrency, provided it is listed.

However, be cautioned that margin trading carries additional risks. The profits can be as significant as the losses as the leverage are very high. Hence it is not recommended for beginner traders.

  • OTC Trading

Here also, BitFinex differs from other exchanges. Big pocket investors typically love to deal behind closed doors. Even though blockchain advocates tout privacy as the main essence of the technology, such investors would rather buy or sell over-the-counter.

Note that the caliber of investors hereto referred keep as much as $100,000 worth of cryptos in their portfolio. Customers of that level can use BitFinex OTC services to facilitate such transactions securely.

BitFinex users can also explore the derivatives trading section where they get to profitably (or otherwise) speculate on the price movements of an asset without actually owning the asset. Derivatives also integrate features of margin trading. All a user needs to do is deposit USDT into a special account designated for derivatives trading.

In addition to lending, staking is another way to earn in the crypto economy without needing any experience with the price fluctuations- the third method being participating in a decentralized exchange’s launch pool.

BitFinex allows its customers to easily stake their crypto assets while earning profits in the process. Staking also doesn’t require having technical know-how. An intuitive interface is provided on the platform to make it simple.

  • BitFinex Customer support services

BitFinex users receive customer support attention 24/7 but only through email contacts. Responses typically take 12 hours or more, attracting lots of negative criticism.

However, the exchange does offer a knowledge base that features the FAQs and ToS( terms of service). There is a ticketing center where users can register pressing challenges they face while interacting with the exchange and give feedback.

Nonetheless, the platform might be commended as one of a few crypto exchange sites with good ratings on TrustPilot as some of its known competitors have scored poorly on the popular review site.

BitFinex supported countries

In addition to the USA, BitFinex doesn’t permit client registrations from these four nations: Bangladesh, Bolivia, Ecuador, and Kyrgyzstan- mainly due to harsh regulatory measures of those countries to crypto projects operations.

However, persons from those countries can still access the site since all that is required for onboarding is just a verified email address. However, if such persons should attempt doing so despite their countries’ legislations, they’d be doing it at their peril.

If a client wishes to transact a “higher” amount, additional sign-up requirements must be met, including standard KYC (know your customer) process and address verification. Only when this process is followed will BitFinex be able to tell if a customer is from any of the prohibited countries.

Specifically for Tether-based transactions, KYC verifications are mandatory. But the bottom line is that: BitFinex is a global exchange.

BitFinex and Binance

Aside from other similarities, both exchanges have interacted with China. Binance though not situated in the country, but originated from there. BitFinex presently has its headquarters in China.

As regards the GUI, BitFinex features a more sophisticated and even confusing interface than Binance.

Binance also has a better reputation among crypto advocates than BitFinex, even though the latter has been around longer than the former. Perhaps that is because all through the years of operation, Binance has managed to keep its promise to be a stable and “clean” crypto broker.

In terms of trading a few, BitFinex offers a more friendly rate than Binance’s. Hence, it has an edge on this one. For more details on BitFinex’s transaction charges, see our review of it below.

Trading fees on BitFinex

BitFinex uses a taker-maker principle for processing transactions. That is, the category of traders who fill the open positions are referred to as takers. Then those who assume limited positions are the makers.

Usually, a starting fee of 0.2% is set for takers, but no fee is charged for creating a limit order. That means that makers have a perpetual 0% transaction fee of the transaction if it exceeds $7.5 million – the reason being that makers are the source of the market liquidity, and takers’ action reduces the volume. When it is below that threshold, a maker fee of 0.1% is applied. For OTC Trading, no fee is required if the size of the order is vast.

Nonetheless, with crypto trading, which works very differently from forex market trade, fees are charged based on the nature of transactions they involve. BitFinex uses a flat 0.1% rate charge for all fiat-based transactions.

Payment gateways and withdrawals methods

BitFinex processes both hard currencies and native crypto assets. Fiat transactions, whether deposits or withdrawals, are carried out through international bank wiring gateways. They typically take a 5-7 hour confirmation period. At the time of writing, EUR, GBP, JPY, and USD are the acceptable fiats.

For blockchain-enabled digital assets such as Bitcoin, LiteCoin, EOS, XRP, etc., transaction fees for deposits are free, while a relatively small sum is deducted for withdrawals.

BitFinex Security

After a relatively long time of operational stability, BitFinex seems to have finally overcome the vulnerability issues that plagued it in the past.

Though we do not know so much concerning the security or encryption technology the exchange currently uses, it has apparently tightened its security measures.

Also, users are always reminded to enable advanced second-layer protection in their sign-up process. Specifically, these are two-factor authentication methods and the physically applied Universal second factor (U2F).


Though BitFinex has gone through myriad challenges, it is presently one of the most advanced trade platforms out there. The exchange seems to have overcome its troubled past and has become one of the most reliable crypto trading sites today.

That perhaps speaks volumes of the management team’s determination to make BitFinex a reckoning force in the industry. So, users need no longer have any trouble trusting the exchange.

BitFinex Exchange Rating
Read our Bitfinex review and learn why we recommend this exchange for online trading and why it is not a scam, learn all you need to know in this Bitfinex review before you sign up with the exchange.
Account Types
Trading Speed
Customer Service

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Shelly Melancon (Switzerland)

Shelly is a cryptocurrency enthusiast from Switzerland, she bought her first crypto in 2015 when it was way less popular then it is today and since 2017 she has been writing about cryptocurrency for online news portals. Shelly is the newest addition to the Tokenhell team, she writes mostly news and reviews related articles , stay tuned to her posts to stay up to date with the crypto world.

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