ShapeShift Review: Is It The Best Crypto Exchange Today?
To trade or buy cryptocurrencies, you need a crypto market. ShapeShift is a leading cryptocurrency exchange that has cut a name for its security, unique features, and focus on privacy.
Even as more traders and crypto communities express their thrill of ShapeShift, a closer look at listed controversies such as the recent revelation by Wall Street Journal that it processed about $9 million from criminal activities in 2017 and 2016 have cast a negative shadow on it. Some people have started asking questions such as: “Is ShapeShift the best crypto exchange that it claims to be?”
This ShapeShift review is a comprehensive review of the exchange to establish how it works, its security, and help the crypto community establish whether they should use it or not. Welcome to discovering more about ShapeShift and making the right trading decision.
What is ShapeShift?
ShapeShift is a cryptocurrency exchange created in 2013 and launched in 2014 by a blockchain enthusiast, Erik Voorhees. The founder wanted to simplify the process of acquiring cryptos by making ShapeShift easy to use like a “vending machine” where everybody can go and use it with ease.
Though it only supported a few coins at its launch, the list grew to 40 cryptocurrencies that provided more than 940 trading pairs by 2015. By July 2018, the supported ShapeShift’s list of coins had grown to 103.
In August 2017, ShapeShift made a major stride by acquiring the Seattle-based hardware wallet referred to as KeepKey. The acquisition was strategic in giving the platform a competitive edge in the market. “With ShapeShift, you do not need to leave the coins on the exchange. With KeepKey, users do not have to leave their tokens on the computer,” Voorhees posited.
The focus of ShapeShift is ensuring that its users have the most secure and reliable platform for storing and trading their coins.
ShapeShift: A 4.0 Star Rated Exchange
The ShapeShift founder’s vision of simplifying cryptocurrency trading and a determined team make the platform a great option for both experienced and new crypto enthusiasts. Though the exchange has suffered its fair share of attacks especially in 2016 when 5800 ETH, 1900 LTC, and 469 BTC were lost, the structural improvements such as the change of security protocols implemented by the development team were impressive.
The crypto community is especially amazed by Shapeshift’s focus on enhancing anonymity. Unlike other exchanges such as Bittrex that require users to register for trading accounts and verifying them with government-recognized information such as proof of identity, ShapeShift’s commitment to help traders operate anonymously has won it a high rating in the community.
However, this commitment to anonymity has also partly worked against the exchange. One case that saw ShapeShift’s rating go down was the revelation that Wanacry ransomware attackers used the exchange to convert their Bitcoins to Monero, a coin that is fully dedicated to optimal security.
The Wannacry ransomware attacked institutions especially in Europe early in 2017 by taking control of their files and encrypting them until the owner pays a ransom. The association with attackers is likely to dent the image of ShapeShift for years because its name will always come-up when ransomware is mentioned.
How Does Shapeshift Work?
Unlike other cryptocurrency exchanges that require users to start by registering for trading accounts and submitting additional info, ShapeShift is different. This Shapeshift.io review established that users only need to download the trading platform app to start trading.
To make trading easy, ShapeShift requires users to start by specifying the coins they want to deposit and exchange with a different one. This is done without requiring users to make any subscription or verification.
After selecting the desired tokens, the trader can select either the ‘Precise’ or ‘Quick’ order option from the interface.
The Quick order option: This option allows users to swiftly give addresses for receiving the targeted coin. They also have a ShapeShift address to deposit their coins. The entire transaction looks like you are buying the targeted coins from ShapeShift. But ShapeShift is simply executing the order on your behalf.
Though the Quick order option is fast, the exchange rates fluctuate regularly. The system updates every ten seconds until a transaction is effected.
The ‘Precise’ order option: Under this option, users do not need to provide a receiving address immediately. They only need to notify ShapeShift about the amount they intend to deposit into. ShapeShift also tells the trader the amount he/she will receive after the trade is completed.
The main advantage of the Precise order option is that the ShapeShift exchange rate is constant throughout the trade. Besides, users also enjoy a higher deposit limit compared to those using the Quick order option.
The following video demonstrates how to trade at ShapeShift.
Is ShapeShift Safe?
The ShapeShift development team puts a lot of weight on guaranteeing users optimal security. ShapeShift crypto exchange is considered more secure because users are not required to add personal information or run verifications. Though the exchange has an added advantage of not using a hot wallet that hackers can easily get into, the question on where the funds go once deposited on ShapeShift persists.
When users deposit their funds on the exchange, the platform takes control of the tokens. This means that you need to simply trust that the exchange keeps the coins securely until the transaction is completed.
Following the 2016 ShapeShift attack, the exchange restructured its system to prevent the recurrence of a similar attack. The CEO of the exchange, Erik Voorhees, offered an honest explanation about the mistake that saw the attack being carried successfully. He pointed out that the attack was caused by an employee who betrayed the company and created an emptying Bitcoin wallet. However, Erik insisted that no loss to clients’ funds was reported.
With the integration with the hardware wallet, KeepKey, it is likely that most of the user tokens will be stored in the hardware wallet for extra security. Therefore, this ShapeShift review considers the exchange a safe option and you should not shy away from using it. However, it is important to appreciate that no platform or technology can be 100% secure. Therefore, consider using the following tricks to remain safe on ShapeShift platform:
- Only trade a small portion of your tokens on the exchange
- Once you have executed orders, do not leave your tokens on the ShapeShift platform
- Make sure to keep your computer, blockchain clients, and anti-malware protection up-to-date
- Never share your private keys with third parties
- Consider using the most secure wallet such as hardware wallets such as Ledger Nano S because they are considered more secure
Fees on ShapeShift
One of the selling points of ShapeShift is its low transaction fee. Unlike other platforms such as Binance that charge a flat fee of 0.1%, ShapeShift’s fee depends on the cryptocurrency being traded. Therefore, you should check the fee before starting to trade.
It is important to note that the fee on the platform goes to pay miners who confirm transactions on different blockchains. Here is a list of the transaction fees at ShapeShift.
|The Traded Coin||The Miner Fee|
Note that there is no deposit and withdrawal fee for operating in the platform. Therefore, your operations on the platform will feel like sending tokens from one wallet to another.
ShapeShift customer support has been impressive. It has a dedicated support page featuring a live chat where users can ask any question. Users can also follow the FAQ page or open tickets to ask questions and get replies within 24 hours. However, the customer support lacks a direct phone line that users can call to talk to support.
The following caption shows the different customer support resources.
It is important to note that like other exchanges, the support at ShapeShift can also be mixed up based on the prevailing circumstances. For example, when things are running smoothly and people are impressed, ShapeShift systems are very effective. However, the support lines can take longer to go through when there are major complaints such as attacks or delays in processing transactions.
ShapeShift Crypto Exchange Summary
This ShapeShift trading platform review established that it is a secure and easy-to-use platform for both new and experienced traders. Here is a summary of the pros and cons of the platform:
- ShapeShift allows users to trade without compromising their privacy.
- The development team is responsive to help keep the platform secure.
- The platform supports many tokens for traders to select the preferred option.
- It allows users to run transactions fast and easily.
- The exchange does not support fiat trading.
- Users are unsure of where ShapeShift stores their tokens after depositing them on the platform.
- It has been associated with the transfer of value by cyber criminals such as Wannacry ransomware attackers.
When crypto traders set out looking for markets to use, the primary goal is identifying an exchange with a committed development team, easy-to-use trading platform, and optimal security. ShapeShift scores fairly well in all the parameters. It is indeed one of the best exchanges in the market today.
Though it has been associated with cybercriminals, especially the Wannacry ransomware attackers, it is indeed an affirmation that the platform anonymity in its system works well. Therefore, if you want to trade fast and anonymously, ShapeShift is a reliable option.
Remember that when dealing with cryptocurrency platforms such as blockchains, wallets, and exchanges such as ShapeShift, your token security largely relies on the adopted precautions. Therefore, focus on the best practices such as trading only what you are ready to lose, moving the native coins to your wallet, and using a hardware wallet for optimal safety.