itBit Review

Low fees for high-volume institutional traders

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itBit

itBit

Investopedia’s Rating
3.9

Our Take

ItBit presents a simple platform for cryptocurrency trading, which may be too simple for some investors. The exchange has few available currencies, but features low trading fees and an extensive set of APIs and custody services, making it better suited for large institutional clients.

  • Pros & Cons
  • Key Takeaways
  • Specifications
Pros & Cons
Pros
  • Low trade fees and rebates on every Maker order

  • Services for personal and institutional traders

  • Regulated by the New York State Department of Financial Services (NYDFS)

Cons
  • Limited number of cryptocurrencies and deposit options

  • Relatively high fiat withdrawal fees

  • ACH withdrawals are not currently supported

Key Takeaways
  • ItBit was created and is managed by Paxos, a company that provides blockchain infrastructure and other fintech services.
  • Paxos has a focus on regulation and security, with licensed custodial services for institutional clients.
  • ItBit doesn’t have many trade order options and could be most valuable for high-volume institutional traders.
  • ItBit is simple on the surface, but it features several APIs and an OTC desk for advanced trading strategies.
Specifications
  • Year Founded 2012
  • Official Website https://paxos.com/itbit/
  • Cryptocurrencies Available 11
  • Customer Support Email ticket, relationship manager

Pros Explained

  • Low trade fees and rebates on every Maker order: ItBit has relatively low spot trade fees compared to other crypto exchanges, and every Maker order gets a rebate of a certain percentage, depending on your trading volume. This cash rebate will appear in your fiat wallet.
  • Services for personal and institutional traders: ItBit has the most basic trading options, like market and limit orders, which could satisfy many personal investors. But it also provides tools for institutional clients and fintech companies, like crypto asset custodial services and API integrations.
  • Regulated by the New York State Department of Financial Services (NYDFS): ItBit was the first crypto exchange to be fully regulated in the U.S. All customer assets must be held in bankruptcy-remote accounts, separate from corporate funds.

Cons Explained

  • Limited number of cryptocurrencies and deposit options: You’ll find a very limited selection of crypto on itBit compared to many other exchanges. And the only deposit options are wire transfer, crypto wallet, and Silvergate Exchange Network (SEN); no bank account, debit card, or ACH deposits.
  • Relatively high fiat withdrawal fees: ItBit has some of the highest fiat withdrawal fees among crypto exchanges we reviewed. You’ll pay $20 for a wire transfer withdrawal in the U.S., or $30 outside the U.S., unless you can use the SEN for free transfers.
  • ACH withdrawals are not currently supported: ACH is a simple and inexpensive way to transfer funds, and many crypto exchanges allow it—but not itBit.

Introduction

ItBit is a cryptocurrency exchange created and managed by Paxos. Paxos provides a number of financial services, including a blockchain infrastructure, several digital currencies, and software to help fintech companies create and manage digital assets.

Paxos has a strong focus on regulation and security, and has taken steps to become one of the more trusted crypto exchanges on the market. ItBit was the first crypto exchange to be licensed by the New York State Department of Financial Services, ensuring a certain level of security and insurance for customer assets. It also maintains FDIC insurance, insurance for its PAXG coin, and a set of standards to secure custodial assets.

ItBit has fewer available cryptocurrencies than most other exchanges, and some traders could find the order types too limiting as well, but it includes a number of tools that could make it useful for institutional clients. 

Investing in cryptocurrencies, Decentralized Finance (DeFi), and other Initial Coin Offerings (ICOs) is highly risky and speculative, and the markets can be extremely volatile. Consult with a qualified professional before making any financial decisions. This article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies nor can the accuracy or timeliness of the information be guaranteed.

Company Overview

The itBit Digital Asset Exchange was launched in 2012 by Paxos using a regulated blockchain infrastructure. It’s based in New York City but also has offices in London and Singapore. ItBit is currently available in many countries around the world, including all 50 U.S. states.

Although itBit offers a small selection of available cryptocurrencies, it features an over-the-counter (OTC) trading desk for large transactions and a variety of APIs for advanced trading strategies. Due to the limited number of coins and deposit/withdrawal options, and a fee schedule that rewards volume, itBit may be best suited for institutional investors with high trading volume and access to the Silvergate Exchange Network (SEN).

Want to see exchanges with a wider selection of cryptocurrencies? Check out our picks for the best cryptocurrency exchanges.

Cryptocurrencies Available on itBit

ItBit only supports around a dozen cryptocurrencies, in stark contrast to some other exchanges with hundreds of available coins and tokens. The list is short, but it features some popular altcoins like MATIC and LINK, along with Paxos’ own native coins.

  1. Bitcoin (BTC)
  2. Ethereum (ETH)
  3. Litecoin (LTC)
  4. Bitcoin Cash (BCH)
  5. Binance USD (BUSD)
  6. Aave (AAVE)
  7. Polygon (MATIC)
  8. Chainlink (LINK)
  9. Uniswap (UNI)
  10. Pax Gold (PAXG)
  11. Pax Dollar (USDP)

Trading Experience

ItBit only offers three basic order types for trading:

  • Limit order: An order to buy or sell an asset at or below a certain price
  • Market order: An order to buy or sell an asset immediately, at the best available price
  • Post-only order: A type of limit order that will not remove liquidity, and will only post if it does not lock or cross with an existing order
itBit
Placing a market order with itBit.

Some people will find these order types suitable, but experienced traders may want a more robust platform with more advanced order types (and more available cryptocurrencies).

APIs

Along with trading services through the basic platform, itBit offers three types of APIs to help execute more complicated strategies: 

  • Stablecoin swap: Swap from one stablecoin to another with no fees.
  • Fiat gateway: Swap between fiat and stablecoins issued by Paxos (including USDP and BUSD).
  • Trading/market data APIs: Provide access to itBit’s order books, pricing data, and trade data; allow customers to automate fiat/crypto trading. These APIs can be useful for institutional, high-frequency, and/or algorithmic traders.

ItBit users can connect third-party trading bots to help automate trading strategies.

OTC Trading Platform

Over-the-Counter (OTC) trading refers to trading directly from one party to another without going through a centralized exchange. Cutting out that third party can cx c result in more efficient trades at better prices and lower fees.

ItBit offers OTC trading for eligible investors, both personal and institutional, but it requires a minimum trade size equivalent to $100,000. Clients must contact the OTC desk directly to make use of this feature.

Fees

ItBit has a relatively simple fee structure, with a single fee table for all traders.

Payment Method itBit Fee 
Bank Account N/A
Debit/Credit Card  N/A 
ACH Transfer  N/A 
Wire Transfer Deposits  $0 (U.S.)
$30 (International) 
Wire Transfer Withdrawals  $20 (U.S.)
$30 (International)
SEN Deposit/Withdrawal  Free 
Crypto Wallet Deposit/Withdrawal  Market Rate 
Purchases  -0.003%–0.035% (Maker-Taker) 
Trades  -0.003%–0.035% (Maker-Taker) 
Crypto Conversion  N/A 

Deposit and withdrawal options are somewhat limited, and they could get expensive with frequent transactions. To help mitigate costs, institutional investors with accounts at Silvergate Bank can use the Silvergate Exchange Network (SEN) for free deposits and withdrawals of U.S. fiat currency. Silvergate Bank is a California-based company that provides financial infrastructure for fintech businesses and investors.

Like many exchanges, itBit charges tiered Maker-Taker fees for basic crypto trading: The higher your 30-day trade volume, the lower your costs. (“Maker” orders are placed on the order book, and add liquidity to the market; “Taker” orders execute immediately and remove liquidity.)

ItBit now provides a rebate for every Maker order, after testing this perk with Ethereum and finding it popular. Rebates are provided in the form of cash to users’ fiat wallets. The amount of the rebate depends on the trading volume tier.

Maker-Taker fees at each tier are shown below. Take note that additional fees apply for PAXG transactions.

itBit

Security

ItBit employs several security measures you’ll find on many crypto exchanges:

  • Multi-factor authentication (MFA): ItBit requires MFA through an authenticator app, like Google Authenticator, when logging in.
  • Cold storage: ItBit stores the majority of customer assets in cold storage, where it’s better protected from hacking.
  • FDIC insurance: Eligible U.S. dollar and stablecoin deposits are held in FDIC-insured accounts at U.S. banks.

Along with the basics, itBit features special custodial services for institutional clients and insurance for its native PAXG token:

  • Crypto asset custodial services: 100% cold storage for crypto assets; assets are backed by mandatory financial reserves; regular and auditable account reporting.
  • PAXG insurance: PAXG is a token backed by actual gold, and Paxos provides insurance and attestation reports to verify the gold held in custody.

ItBit is regularly audited by independent, third-party auditors which ensure the company’s trading services meet SOC 1 Type 2 and SOC 2 Type 2 standards for information security, privacy, and regulatory compliance.

Opening an itBit Account

ItBit’s account registration process varies depending on whether you’re a personal or an institutional investor. Personal registration is simple; creating an institutional account takes more documentation. Each one requires identity verification according to strict Know-Your-Customer practices, which are standard across much of the industry.

For personal registration:

  1. Create an account: Visit the new account creation page to begin, and follow the instructions.
  2. Verify your email address: Check your email and follow the verification link. Then, set up multi-factor authentication for your account using an authenticator app.
  3. Verify your account: Provide the required personal information from a valid government-issued photo ID, and read the terms and conditions.
  4. Verify your identity: Upload a photo of your ID and a selfie, and provide any other required verification documents.

For institutional registration:

  1. Create/verify your account: Follow the four steps listed above, but select “I am registering for an institution” on the account verification page.
  2. Meet additional KYC standards: Complete the Institutional Onboarding KYC application form, and submit it via the Institutional/Business Onboarding Document Submission tool. Submit the required documentation for your organization (articles of incorporation, national/state registry filings, Tax Identification Number, Certificate of Good Standing, proof of residential address, etc.).

The personal registration process could take about one to three business days to complete; the institutional registration process could take about three to five business days.

Customer Service

ItBit only provides personal customer support through online email tickets—current users can submit a request through an online form, and get a response by email. You can contact the support team in general, or choose a specific issue like Password Reset, Missing Wire Deposit, Missing Crypto Deposit/Withdrawal, etc.

Institutional clients will have access to a relationship manager, who can provide more in-depth support.

If you’d like to contact the OTC desk, use the contact form on the itBit homepage. Financial institutions that would like API access from Paxos can use the same form.

Since Paxos is regulated by the NYDFS, you can also send a complaint to the appropriate government office. For more information call 1-800-342-3736 or visit www.dfs.ny.gov; mail can be directed to:

New York State Department of Financial Services
One State Street 
New York, NY 10004-1511

Customer Satisfaction

Like most crypto exchanges, itBit’s reviews are mixed, and they skew toward the negative. Most personal customer complaints involve funds not being withdrawn or deposited correctly, without much help from customer support. But, as mentioned, itBit offers services for both personal and institutional investors and provides a premium level of support for the latter.

Account Management

For basic users, itBit isn’t the most complicated exchange—as such, its online dashboard is easy to use and navigate. After setting up your account, you can begin trading by adding a bank account for a wire transfer or depositing crypto.

itBit
Adding a bank account to itBit.

Select the Wallet tab at the top of the screen to deposit assets to your itBit wallet, or transfer assets to another wallet. You’ll receive an email notification when deposits and transfers are completed.

itBit
Depositing funds to an itBit wallet.

ItBit offers several options to transfer or withdraw assets:

  • Crypto asset withdrawals to external wallets
  • Wire transfer withdrawals to bank accounts
  • Transfers to brokerage accounts
  • Transfers to other Paxos users (peer transfers)

Institutional investors who want access to itBit’s APIs or OTC desk should contact their relationship managers.

Although many crypto exchanges offer mobile apps (like Coinbase, KuCoin, and Kraken), itBit is not among them.

How itBit Compares to Other Cryptocurrency Companies

Like most exchanges, itBit has a few high notes and a few low notes. It has fewer available cryptocurrencies than many other exchanges, but it has relatively low trade fees and good security. Although there are only a few basic order types, itBit allows for API integrations and bots to help execute advanced trading strategies.

Here’s how itBit stacks up to FTX, a larger and more popular exchange that also has fairly low trade fees.

itBit vs. FTX

  • ItBit has 11 available cryptocurrencies; FTX has 279
  • ItBit offers three order types, only for spot trading (limit, market, post-only); FTX features advanced spot trading along with derivates, futures, and stocks.
  • ItBit and FTX each employ standard security measures (MFA, cold storage, etc.), but have licensing regulations from different governmental entities (itBit is regulated by the NYDFS; FTX’s subsidiaries are subject to a variety of regulations from different countries, not including NYDFS).
  • Withdrawing fiat from itBit can be expensive and ACH transfers are not allowed; FTX charges low or no fees for withdrawals (and allows ACH transfers).
  • FTX offers extra features like a crypto credit card, staking, rewards, and loans; itBit does not.

Overall, although FTX may be overwhelming for some beginner traders, it offers a more comprehensive and useful trading platform, with much more liquidity. 

Read our full FTX review.

Final Verdict

ItBit is a relatively simple exchange, with a small selection of available cryptocurrencies. This, coupled with the limited and expensive deposit/withdrawal options, could make it less appealing for the typical personal investor. On the other hand, trade fees are low and the Maker rebate is a nice touch. 

But overall, itBit is geared more toward high-volume traders who focus on the most popular cryptocurrencies. The wide selection of APIs, the OTC trading platform, and the crypto asset custody services could make it a wise choice for institutional investors who want a regulated, secure exchange to trade just a few cryptocurrencies.

Methodology

Investopedia is dedicated to helping those interested in cryptocurrency investing make informed and safe decisions. We are committed to providing our readers with unbiased reviews of the top cryptocurrency exchanges for investors of all levels.


Exchanges were reviewed on points including security, fees, number of cryptocurrencies available, and more. We also considered if the exchange is regulated by a proper agency or entirely decentralized. Our full cryptocurrency exchange methodology, including the review process and weighted data points, is available for review.