Coinsquare Review: Complete Beginners Guide
Coinsquare is a premium cryptocurrency exchange that offers excellent security and great onboarding options for new crypto users. It is one of the largest digital asset trading platforms in Canada and has expanded its service offerings to include retail and institutional trading, crypto payment processing, and digital asset custody.
In this Coinsquare review, we will take a look at one of the biggest cryptocurrency exchange in Canada.
They have grown considerably in the past two years and are one of the go-to Canadian exchanges. However, they are also not free of controversy. 2020 not only saw the exchange suffer a personal data breach but the CEO was also accused of wash trading on Coinsquare's order books.
So, is Coinsquare still safe?
In this Coinsquare review, we will attempt to answer that. We will take a deep dive into the security and trading functionality. We will also give you some top tips that you need to consider before trading here.
As mentioned, Coinsquare is a large exchange that is based in Toronto Canada. They started out as Coinsquare.io as a pure retail cryptocurrency exchange but have since moved to Coinsquare.com and have expanded the business.
They have opened up a mining venture arm as well as a capital markets division that will focus on high net worth individual investors and institutions.
The company was founded in 2014 and has grown substantially since then. They have raised over $47.3m in the past few years with the most recent funding round seeing them bringing in $30m. Today, there are over 90 employees in their office and they hope to employ over 200 by the end of the year.
This has helped Coinsquare to become the dominant cryptocurrency exchange in Canada and they have grown to have over 100,000 user accounts on the exchange.
Coinsquare has also been lucky in that they were one of the exchanges that stood to gain from the collapse of QuadrigaCX. For those that do not know, Quadriga was the exchange that went under when the CEO died with the private keys.
However, there have been a number of other Canadian cryptocurrency exchanges that have expanded their operations. These include the likes of BitBuy, Coinsmart and Coinberry. This means that the market is becoming increasingly competitive.
Is Coinsquare Safe?
Security and exchange safety is one of the most important considerations for any centralised exchange.
This is especially true for Canadian cryptocurrency traders given the recent collapse of QuadrigaCX. Thousands of users lost millions of dollars because of the poor operational practices of the CEO and management team.
Luckily for Coinsquare, they have not had a single incident in their 4 year history - so that is a plus. This could probably come down to their exchange and user-side security protocols. Below are some of these systems and tools that the exchange implements. Coinsquare also gets a firm nod of confidence as they are Canada's first IIROC-regulated cryptocurrency exchange, so users can be fairly certain that there are no shady dealings going on there as we saw with FTX.
Coinsquare employs well-known security protocols when it comes to coin management and server testing. For example, they operate a system of 95% cold storage of coins in their control. Cold storage means that they store the private keys to the coins offline and air gapped away from the internet. These are some of the most secure ways of keeping hackers far away from the coins.
Another concern for an exchange is losing track of ledger management and account balances. This is something that happened at the Bitgrail exchange for example. Coinsquare manages their ledgers "about 2346" times a day so they are able to keep track of all that which is owed.
Lastly, they claim that they have stress tested their servers to make sure that they do not fall victim to DDoS (Dedicated Denial of Service Attacks). For anyone who has traded on exchanges such as Bitfinex they will know how stressful DDoS attacks can be as they bring down the exchange and restrict you from getting access to your coins.
Coinsquare also has measures in place on the user side to protect you from phishing attacks and hackers that attempt to get into your account. For example, they have two-factor authentication that will help secure your account in case someone gets hold of your password.
This is not activated by default so we would recommend that you activate it the moment that you start using Coinsquare in order to protect yourself from the get-go.
They have also implemented secure SSL communications in order to avoid the risk of any man-in-the-middle attacks that could try to intercept your internet traffic. Hence, you should always look for the secure green padlock when logging into Coinsquare to make sure that you are not on a phishing site.
Of course, it goes without saying that you should never leave a great deal of coins on any exchange. As the saying goes...
If you don't hold the keys, you don't own the coins
Despite all of these supposed security procedures, Coinsquare suffered a data breach in early June of 2020. The breach was not a hack but data theft from a previous employee. This information then ended up on the darkweb.
The hackers that were able to get hold of the data had access to cellphone numbers, emails and ID documents. This is particularly risky as this information can be used to conduct a sim swap attack. For those that do not know, these sim swap attacks have been quite destructive for those who their coins on the exchange.
The hacker shared some of the data with the Motherboard publication in order to verify that they have indeed had access to it. They have over 5,000 user contact details. Not only was this a security threat to those users on Coinsquare but it also exposed them to potential exploits on other exchanges and services that they used.
Coinsquare said that the data breach was disclosed to all the users, the authorities and the data regulators. This is still not great to hear for those traders who have had their data exfiltrated.
Coinsquare started off as a Bitcoin exchange but has recently expanded their cryptocurrency asset coverage to include Ethereum, Litecoin, Bitcoin Cash, Dogecoin, Dash, Ripple XRP as well as Stellar Lumens (XLM).
Coinsquare is what is called a "Fiat Gateway" primarily for use by Canadian traders who want to use their CAD to buy cryptocurrencies. While many users would be comfortable with the coins that Coinsquare has on offer, there is always the option to move these coins onto another cryptocurrency exchange and pick up other altcoins.
Hence, Canadian cryptocurrency investors can buy their Bitcoin with their Canadian dollars on Coinsquare and then move them to another exchange such as Kraken or Binance in order to buy the smaller altcoins. If you wanted to get an idea how much crypto you could buy on their platform with your dollars right now you can use their currency converter.
Trading fees at Coinsquare are relatively simple to understand and are really attractive. In fact, compared to other Fiat exchanges, the trading fees at Coinsquare are at least half of them.
They have two types of orders being market order "Bit markets" or a Quicktrade.
Bit Markets Fees
For the BitMarkets trades, they operate a maker / taker model where those who make a market have a slightly lower fee than those who take the market price. When you are trading on the Bit Markets exchange you will pay 0.1% as a "Maker" and 0.2% as a "taker".
So, what do we mean by a "maker" and "taker"?
Quite simply, a taker is an individual who is taking liquidity away from the exchange by meeting another order that is already on the books. You are charged a slightly higher fee because you are "thinning" the Coinsquare order books.
On the other hand, if you are a maker then you are placing an order that is away from the current price and hence you are adding liquidity to the markets. This is why you will receive a slightly lower fee.
Quick Trade Fees
If, on the other hand, you would like to buy cryptocurrencies quickly without having to place your orders on the book then you can purchase using a Quicktrade. Here, your counterparty to the trade is Coinsquare and you will pay a flat fee for the trade.
If you are swapping Bitcoin for some other coin then you will be charged the single rate fee of 0.2%. Alternatively, if you trade one altcoin for another altcoin (no Bitcoin at all) then you will pay a double fee of 0.4%.
Just as a comparison, if you were to get charged the highest fee for the trade at 0.4% this is still quite small compared to the 1.49% fee that is applied at Coinbase for example.
Coinsquare Payment Methods
There are a number of ways for you to fund / withdraw from your account at Coinsquare. They have relationships with quite a few Canadian banks which means that CAD funding options are relatively straightforward. Below are the funding options together with fees and processing times.
It is important to note before you decide to fund your account that you should be verified and have completed their required KYC steps. We will cover all of this below.
|Payment Method||Min||Max||Fee||Processing Time||Withholding|
|Interac e-Transfer (r)||$100||$3,000||0%||1-5+ Days||3|
|Credit Card||$100||$5,000||10%||Instant||7 Days|
|Bank draft||$1,000||$9,000||0%||1-3+ Days||14 Days|
|Money order||$100||$999||0%||1-3+ Days||5 Days|
|Wire transfer||$10,000||$300,000||0%||0-3+ Days||Instant|
In the above, the "withholding" is the time that Coinsquare will take to allocate your funds to your account. This can be waived for those traders are recurring customers. The "days" listed above are business days as well. The "max" is defined by the sum total of all the funds that have come into the account in a 24-hour period.
Something that many people seem to have an issue with is the cost for crypto credit card purchases. This is pretty exorbitant at 10% (compared to 3.9% at Coinbase). However, many banks in Canada are trying to outlaw crypto credit card purchases so it seems pretty reasonable.
Of course, you can also fund your account with cryptocurrency. In this case, the time that it takes for your transaction to propagate will determine how long it will take to be placed in your account. They will not charge a fee in order to credit your account with crypto.
If you wanted to withdraw your funds in Canadian dollars then the following are your options to do so.
|Payment Method||Min||Max||Fee||Processing Time|
|Direct Bank Deposit||$100||$10,000||2%||1-9 Days|
|Wire transfer||$10,000||$100,000||2%||1-9 Days|
|Wealth Wire||$10,000||$100,000||1%||1-9 Days|
|Rushed Wire||$50,000||Unlimited||2%||1 Day|
The "wealth wire" is the payment option for those traders who run Coinsquare wealth accounts (more below). Rushed wire is the same as a simple wire except you will pay a premium in order for Coinsquare to process your payment with haste.
Similarly, you can always withdraw just the coins off of the exchange. Coinsquare will not charge a fee for this but they will have to charge the going rate for the network (mining) fee.
Coinsquare Login and Registration
If you wanted to start buying coins on Coinsquare then you would need to register an account. You can click the "getting started" button on the homepage and this will take you to the main registration page. This is pretty straightforward and is presented below.
You will need to confirm your email address before you can move onto the next steps. Once complete, you have officially signed up and created an account at Coinsquare. However, this account is an unverified account which means that you have not completed the KYC required at Coinsquare.
This is an important step and can be quite cumbersome.
Coinsquare is required by law to confirm the identity of those people who trade on their platform. This is why they require you to handover information about yourself including your proof of identity and address. These are given in the below image.
You will need to confirm your telephone number with a valid mobile number. They will then ask you to upload your identity document as well as your proof of address on the platform.
An acceptable identity document can be a driver's licence, passport, National Identity card, Permanent residency card or Health Card (assuming Quebec province). The proof of address can be a bank statement or utility bill.
Once you have submitted your verification documents, Coinsquare will have to take the time to read through them and make sure that they are well presented. They claim that they try to get this done ASAP but you should budget about 1 full day for the verifications to be complete.
When we registered our account and sent through the documents it took slightly over 1 day which is still quite impressive. If you were to compare this to the weeks that it took on an exchange such as Bitstamp or Kraken in December / January then one can appreciate.
Depending on what sort of cryptocurrency buyer you are, the trading platform can make / break your experience. Some people would like to merely buy and "hodl". Others would like to trade the crypto markets more regularly as a day trader. The latter will therefore be really interested in the type of trading technology an exchange has.
For those who are interested in merely buying a cryptocurrency quickly with a simple buy order, they will use the "Quick Trade" option that is available right on the dashboard. Here, you can get a simple quote for the cryptocurrency that you want to buy and then place your order. It will be executed immediately and added to your wallet.
Your holdings to the left of the order form will then be updated to reflect the coins that you have just bought. You also have a basic overview of the price movements over the past 24 hours for the coins that have moved the most.
Below that you will also have a summary of the live markets with the updated prices of all the coins available for purchase on the Coinsquare platform.
For those day traders among you that would like to have a few more tools at your disposal, you can head on over to the Advanced Trade tab on the platform. This will give the trader greater functionality when it comes order types and of course slightly lower fees (maker / taker).
It will also give you more information on the order books, current pricing as well as the most recent orders. Below is a screenshot of the advanced trading platform with the order form to the left of that.
The first thing to point out is that Coinsquare allows you to change the theme of the advanced trading platform. This is ideal for those traders who love that space grey dark theme. This is also a relatively new feature on the platform and it is a welcome change.
If you take a look at the chart on the left, it will be quite familiar to most traders. This is because the chart is a Tradingview chart. Coinsquare is using the software from this well-known charting package provider. It is also used by a number of other exchanges as their charting software of choice.
Tradingview charts give you a whole range of tools that you can run technical analysis with. Not only can you chart out the patterns and trend lines but it also has a compendium of indicators that can serve the chartist well.
Moving back to the platform, you can also toggle between the price chart and the depth chart. The depth chart is a handy indicator which gives traders an idea of how the order books look. It allows one to ascertain the liquidity in the market and where sentiment is heading.
For example, if you were to take a look at the below charts depth charts you can see that there are substantial sell walls on BTC / CAD. This means that it could be harder for the bulls to regain the upper ground as there are large sell orders that need to be chewed through before prices can advance.
Below the charts you have an overview of the orders that you currently have in the market (both open and closed). To the right of that you have the full order books as well as the order forms where you will be placing your order.
In terms of the order types you can place, you can elect to take a "Market" or a "Limit" order. The latter is merely an order level that is chosen by you and placed on the books (getting you the maker fee). The Market order means that your order will be executed at the market rate and you will be charged the taker fee.
So is the trading platform advanced?
Well, it is definitely more advanced than the basic option and has more functions and tools than most other Canadian exchanges. The Tradingview charting means that it can be used to run most of the analysis that the technical analyst may need to do.
However, there are only a limited number of orders that you can place. For example, you cannot place bespoke stop losses when executing a trade. You also have no options when it comes to order life. Orders are good-till-filled which means that they will remain alive until the price is met.
Hence, if you are a day trader that needs the latest tools to trade effectively then I would suggest you use another platform such as Bitmex.
Despite the lack of order functionality, the trading engine is quite effective. We tested out some orders prior to completing this review and they went through smoothly.
For those traders and cryptocurrency users who cannot be in front of their PCs the whole day, then the Coinsquare mobile application will no doubt come in handy. This was developed for both Android and iOS and has some of the same functionality of the online trading platform.
We downloaded the app and started using it just to test the functionality. It is relatively well laid out and you can easily toggle between the different functions from trading to funding and withdrawals. It does, however, lack the advanced trade option so you cannot use the more advanced order types.
We also took a look into the reviews that people were leaving on the App store and Google play store. It seems as if the Android app had quite a few technical issues that some users mentioned. There were quite a few complaints about the latest release of the app that it was not properly tested before being rolled out.
There were also a number of other users who took issue with the credit card fees that we mentioned above. What we did find encouraging though was that the Coinsquare development team answered most of the concerns and asked those users with issues to send them more information about it.
Customer support is a very important consideration for a crypto trader. There is nothing more frustrating than having to wait days on a support ticket without getting any updates. Coinsquare appears to be pretty efficient in this respect.
For starters, if there is a general question that you had then you are probably best suited to try out the online FAQ section. In at least 90% of the cases, the question that you have can be resolved in the FAQ section.
If you have a more specific question that you need help with then you can make use of their chatbot / ticketing system. We are not massive fans of chatbots but they make up for it in terms of their response times to the tickets that you submit.
The support office hours at Coinsquare are form 9:00am to 5:00pm EST Monday to Friday. They say that the response time that you can expect is 1-3 days but when we reached out the support usually got back to us within 12 hours.
Unfortunately, there is no telephone support for those with standard accounts. Perhaps as the Coinsquare team grows and more support personal are brought on board they can begin offering this similar to what Coinbase has started offering now.
Coinsquare Referral Program
If you do decide to sign up and trade at the exchange and you have a pleasant experience then you should make use of the Coinsquare referral program. With this, you can refer your friends to the platform and you can earn $20 for each friend that you refer.
You can refer them through three different ways.
Firstly, you could simply send them your referral link and they can sign up on it. This will be tracked by Coinsquare and once they have funded their account with $100 you will earn $20. They will also earn $20 as a welcome fee for crypto purchases.
Secondly, you could give them your referral code and they could insert this when they are signing up. The last option is to send them an email directly from your account dashboard. With this they will receive an email from Coinsquare with the referral number. Their signup will be registered.
Note ✍️: Be sure to read the terms and conditions that are applicable to these bonuses as well as acceptable marketing practices.
CEO Wash Trading
June 2020 was not a great month for Coinsquare. On top of the data breach that occured because of the employee theft, there were also a number of reports that the CEO had encouraged employees to conduct wash trading on the exchange.
For those that do not know, Wash Trading is the practice of simultaneously buying and selling the same asset in order to make it look like there is more activity on the exchange than there really is.
These were based on leaked documents that were also shared with the Motherboard publication. They showed that the CEO directed his employee to turn on the wash trading algorithms after they were visited by the regulators.
So, it is important to know about these acqusations if you are going to trade there. Wash trading is actually illegal and is a form of market manipulation that has been outlawed by the securities and exchange commission (SEC).
Something that we have not seen being actively being promoted at other exchanges was separate services for the larger whales on their exchanges. Other exchanges will have different fees based on trading volume but they will not segment the traders into separate account groups.
Coinsquare is breaking from the pack by offering their premium cryptocurrency trading services through Coinsquare wealth. This has been described by Coinsquare as:
An exclusive service with lower fees, priority account support, and unrivalled security for elite customers
So what exact benefits to these Coinsquare wealth traders get?
They have three separate tiers of account in classic membership style. They have a Gold, Platinum and Diamond account levels. They differ based on the fees that apply to funding, withdrawals and support / VIP access. Below is a breakdown:
While these may seem attractive, its important to note that these minimum sizes are for orders. In order just to get gold standard you would have to place orders that are a minimum of $25,000. If you plan on such large volume then this will no doubt be beneficial.
Moreover, you will have access to the OTC desk which means that trades can be done at a lower rate than is available on the order books.
Coinsquare vs Coinbase
One of the biggest competitors that Coinsquare has is Coinbase which is based in California in the USA. While they are a USD Fiat gateway, they do offer credit card purchases which have a much lower fee than Coinsquare. Below are some of the factors you can consider when choosing between Coinbase and Coinsquare.
|Buy / Deposit Methods||Interac, Credit Card, Bank Draft, Wire Transfer, Money Order||Credit Card, Debit Card, Wire Transfer|
|Sell / Withdrawal Methods||Bank Deposit, Wire Transfer, Rushed Wire, Cryptocurrencies||PayPal, Wire Transfer, Cryptocurrency|
|Available Crypto Pairs||BTC, ETH, LTC, BCH, DOGE, DASH||BTC, ETH, ETC, LTC, BCH|
|Fiat Currencies Accepted||CAD||USD, EUR, GBP|
|Trading Platform||Basic||Advanced (Coinbase Pro)|
|Customer Support||Ticket Support System||Email, Contact Form, Support Number|
|Trading Fee||0.1% / 0.2% (maker / taker) 0.2% / 0.4% (Single / Double)||1.49%|
So, while Coinsquare offers Canadians an affordable way to buy cryptocurrencies with Canadian dollars, Coinbase has a much more advanced trading platform. Also, as mentioned Coinbase has a dedicated support telephone number so you have to determine how much this means to you.
What We Didn't Like
While Coinsquare seems a reasonable alternative for most Canadians, there are a number of things that we think need to be addressed before the exchange can really expand.
Firstly, you have those questions that surround that data breach. By allowing an employee to steal 5,000 user accounts without any sort of protection mechanisms in place was unfortunate. Users should consider this before they hand their data over for KYC purposes.
Secondly, the wash trading allegations are no doubt serious ones and do raise a number of questions about the conduct of the exchange and the CEO. One cannot be entirely comfortable using an exchange where they know that the volume is not legitimate.
Onto other improvements though, we also think that Coinsquare should integrate more cryptocurrencies. There are a number of large altcoin cryptocurrency exchanges that have begun accepting Fiat wire deposits. They will no doubt eat into Coinsquare's market share unless they can offer a viable alternative with a range of other Altcoins.
Lastly, we also think that Coinsquare should find a more affordable credit card processor. Charging 10% for a credit card purchase is unpalatable to many people and reflects badly on the exchange.
Our Coinsquare review was relatively easy to complete. It's a pretty large exchange that has been offering Canadians with an attractive trading alternative for a couple of years now.
Moreover, they are trying to expand vertically in the cryptocurrency industry as they are also investing in crypto mining ventures as well as a larger capital markets business.
However, despite this there are a number of concerns that surround the exchange. They have to take concrete steps to address their data breach and wash trading allegations. This is especially true given the competition they now face in Canada.
It will be interesting to see what course of action the exchange takes in light of this. However, if you were looking for a relatively quick and easy way to get your hands on crypto with CAD then this coul be a decent alternative.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.