CoinMate.io has been in beta since December, but has finally gone public. The Britain-based Bitcoin to fiat exchange bills itself as offering numerous security features which it believes the whole industry should adopt. In particular, the exchange plans to use Trezor hardware wallets to secure coins stored with it.
CCN spoke with Roman Valihrach, CEO of Confirmo, LTD, the parent company of both CoinMate.io and BitcoinPay.com, via Skype. The company also owns BitcoinPay.com, a service not unlike BitPay, BitNet, or BitKassa. On the issue of security, it was chief among his concerns:
We know [inventor of Trezor] Slush. He’s from Prague. He had the Slushpool, and now he introduced Bitcoin Trezor, which is a hardware wallet. So we’re in talks with him and we want to some kind of co-operations that will offer his solutions to our clients. We use it ourselves. […] We have experience for ten years working with payment systems.
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The exchange takes sort of a “no cash on hand” approach to Bitcoin security, similar to the way cab drivers, restaurants, and bars will only hold a limited amount of cash at any given time. Very busy establishments and drivers will make regular deposits, and similar to this, the company, as a rule, does not keep more Bitcoin on the server than is necessary. In his words, he said:
We worked with just regular payment systems previously and we were regulated by the European law, so we know all the things that you have to do properly for the safety of money. Meaning, we know how much money is owned by the users, so that’s the money we have to hold separately at all times, and only work with our own capital. Speaking of Bitcoin, we hold all of the Bitcoins that are our clients’ separately in offline wallets, and we only had a limited amount on the server, so that if that gets stolen – because the server is online, that can always happen – it’s not going to do any damage to us.
Bitstamp, when they got hacked back in December, I think their online wallet, the hot wallet, was just the one for receiving bitcoins or for paying out bitcoins, meaning if the hacker knew how to get access to that wallet, he would wait for the highest amount of bitcoins to be on the server and then he would steal it.
British Laws “Are Better” For Bitcoin Exchanges
Valihrach and his team are from the Czech Republic, but he says that the regulatory environment in England is friendlier to his cause.
It’s easier and the laws are better because there’s many uncertainties in Czech Republic about the taxes and about the [anti-money laundering] legal environment. Whereas in the UK, the laws are better. And I think they will be bringing something like a BitLicense anytime soon in the UK and they’ll be the first in Europe.
Speaking of the exchanges in Europe, yeah, Bitstamp is the biggest. They don’t offer instant bank transfer, so you have to wait a couple of days. That’s one of the advantages that we want to bring in. We want to make it simple for people that are newcomers because the majority of these exchanges focus on experienced traders, and there’s a lot of people that don’t know anything about Bitcoin, maybe they want to try it out, and want to have it very simple and easy to just buy a bitcoin very quickly and easy and have it somewhere safe.
The next version of CoinMate will go live in June and it will introduce a number of features not on the platform now. For instance, many customers will be able to take advantage of European instant bank transfers. Additionally, fees will switch to a “maker/taker” model, where the trendsetters of prices in the market will pay the lowest fees. Valihrach explained this fee model to CCN like this:
Our [current] fee model is just a simple 0.2%, whether you are a market maker or a market taker. We were approached by some professional traders who were trading in some different markets, being some like liquidity makers, and they want to have a lower fee for when you actually – you’re the maker, so that means that you put in a better ask, that’s not going to pair with any other, so it’s going to fill into the order book and stay there for awhile, it could be a couple hours or it could be a couple of days. But if you’re the maker, you’re going to get a lower fee. […] If you’re the maker, you’re probably going to get a 0% fee because you’re filling up the order book.
That’s going to make it simple for anyone who just wants to buy a Bitcoin, not speculate on the price going up or down. So it’s just going to show you the price, you say take it, and that’s it.
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