Despite all the hiccups in value that the cryptocurrency world has seen in the past year, it is still growing at a rather rapid phase.
According to a study conducted by PwC in association with Crypto Valley, initial coin offerings (ICOs) in the first six months of 2018 surpassed the whole investment volume of ICOs in 2017. It was a significant metric, the said volume comprised of no less than $13.7 billion.
This went on to show that even if Bitcoin was nowhere near achieving its once close-to-reach goal of $20,000 in value, the cryptocurrency boon wasn’t going anywhere. That only strengthened the trust of the individuals who considered themselves as a part of the cryptocurrency community, it meant that they would continue trading these digital assets for years to come.
Changelly vs ShapeShift – The Two Platforms That Revolutionized Cryptocurrency Trading
As two of the most prominent digital asset purchase platforms of their kind, Changelly and ShapeShift changed the way that conventional cryptocurrency trading works.
Both of these platforms made the long wait and processes associated with cryptocurrency trading disappear with their no-account-creation policies. If you had cryptocurrency to trade and knew what you wanted, then your trade was as good as completed.
All you had to do was to head to the platform and exchange your own cryptocurrency into the digital asset of your choice – without ever having to create an account (a feature that went obsolete for ShapeShift effective from October 1, 2018).
The platforms did not stop at that, but also went a step ahead in eliminating the needs for bank transfers when it came to purchasing cryptocurrencies through fiat. Instead of having to wait for days on end for a bank transfer to be completed, customers could use their credit cards to purchase cryptocurrency like they were purchasing something from Amazon.
It was, and still is, cryptocurrency trading and purchasing made easy on all accounts.
While giants such as Coinbase also allow credit card purchases, the verification methods of those cryptocurrency exchanges are far more extensive than anything that Changelly and ShapeShift offer. That is why, the verification methods and revised durations employed by these two platforms have become so famous that they are now emulated by exchanges all over the world.
But when it comes to choosing such a service, people often get torn between these two. For most people it is a matter of choosing between identical services. While that is understandable, both Changelly and Shapeshift do differ in some aspects, which is what we are going to go through in this post.
First up, let’s take a look at Changelly, how it came into being, and the services that it offers to its clients along with the costs that come with them. Then, we are going to do the same for ShapeShift. By the time you are done with this post, you should be able to make an informed decision when choosing between these two services.
What is Changelly? All That You Need to Know
Conceptualized by individuals associated with MinerGate, a popular Bitcoin mining pool, Changelly came to the spotlight in 2013 as a prototype. From there, it found a new team and proper founder in Konstantin Gladych, who holds a Ph.D. in data mining and machine learning, and prior to Changelly, had an established career as a business development and MarTech specialist.
Gladych worked on developing Changelly to a fully-fledged service with a number of other team members. With their collective efforts, the team members were able to unveil the service to the world in 2015.
Changelly aimed to make cryptocurrency trading easier for the masses by allowing them to instantly trade between digital assets without the creation of any accounts. The project was welcomed by the cryptocurrency community and business sector due to its then-novel approach, since not many projects had been following that line of thought for cryptocurrency trading, if at all.
Changelly was initially headquartered in Prague, Czech Republic, with Gladych serving as the company’s CEO from April 2016 to August 2018. It recently went through a few operational changes, where the firm’s headquarters were moved to Malta, with its former COO Ilya Bere joining to helm the project as its CEO from September 2018.
Bere has more than a decade’s experience of working in business development and operation management sectors, and is touted as being one of the leaders that directed Changelly through the cryptocurrency industry’s boon of 2017 and the subsequent lull that followed it.
How Changelly Delivers Its Services
Under the new administration, not much has been modified at Changelly. It still remains the same exchange with almost the same services, with users needing nothing but an email address and a pre-existing wallet of their own to start trading cryptocurrencies at the platform.
These services are available through Changelly’s website and any third party services where its API has been integrated, such as Coinomi, Mycelium and TrustWallet. Whereas, its iOS and Android apps are still under development.
In order to start trading between cryptocurrencies, you will first need to create an account at Changelly. However, the account does not ask for any personal information except for an email address, which is used to track transaction history and save wallet addresses.
Once you sign up with your email address, you can select your existing cryptocurrency or fiat currency which you want to pay Changelly with, as well as the cryptocurrency you want to receive in exchange.
The exchange rate is shown right at the transaction screen. Once you confirm the estimate and transfer the cryptocurrency funds to Changelly’s wallet address or pay the desired amount in fiat through credit card, the transaction is confirmed and processed.
Depending on the respective blockchain network and its performance, it would take a few minutes before a transaction is received successfully in your provided wallet address.
However, it should be noted that in case of fiat transactions through credit card, the process is carried out with the facilitation of Simplex, a French payment processor which requires a verification procedure to be completed. The verification process in itself only takes a few minutes and gets completed within a few hours, after which you could use your credit card to purchase cryptocurrency easily.
The Cryptocurrencies Being Offered By Changelly
At the time of writing, Changelly deals in 99 cryptocurrencies.
- Ether Classic
- The Abyss
- Basic Attention Token
- Bitcoin Diamond
- Binance token
- Bancor Network Token
- Bitcoin Gold
- STASIS EURS
- Gemini Dollar
- Kyber Network
- LBRY Credits
- NAGA Coin
- Power Ledger
- Qtum Ignition
- Ripio Credit Network
- Swarm City
- ether USD
- WAX token
- Wings DAO
- XEM (NEM)
- 0x Protocol
The Services Currently Offered by Changelly
You can trade between these cryptocurrencies or purchase any available cryptocurrency through fiat by going to Changelly’s official website, or by using one of the many wallets and third-party apps where Changelly provides its services.
Since its mobile apps are still under development, Changelly’s direct services are delivered only through its website.
Changelly has a flat exchange rate of 0.50%. It is shown on top of every trade made at Changelly for cryptocurrencies.
The exchange also defines the extra fees that charges for credit card transactions, as well as the extra fees that will be charged by Simplex, its payment partner.
- 5% Changelly fee
- 5% Simplex fee
This means that on top of the rates shown at the time of transaction, you would need to pay this additional fee in case of credit card transactions.
Changelly Security and Deliverance of Services
Changelly is secure because you do not have to store your digital assets with the exchange at all. Instead, you receive them directly at your own, provided wallet address.
The same goes for funds in fiat, since they are not stored in a Changelly account but are used as soon as you send them to Changelly through your credit card, with you receiving your new cryptocurrency almost instantly.
This feature of not holding your funds in its wallet and instead delivering them to a channel of your choice makes Changelly one of the safest options for a cryptocurrency exchange, since it means that you yourself are taking the responsibility of taking care of your digital assets through a wallet of your choice.
What is ShapeShift? All You Need to Know
ShapeShift was originated in 2013. After its inception, it took two years of incubation for the concept to launch fully.
Headquartered in Switzerland, ShapeShift made waves in the cryptocurrency industry throughout the world due to its new and innovative concept. That was one of the reasons why it received initial investments from individual investors such as Roger Ver, as well as institutions such as the Digital Currency Group. It is also prudent to note that one of the most famous cryptocurrency exchanges, Bitfinex, also has ties to ShapeShift as its investor.
ShapeShift’s Founder Comes With Some Baggage
One of the other reasons why ShapeShift was able to get this much attention was that its founder and CEO Erik Vorhees was a tenured name in the cryptocurrency industry. That mattered significantly even if the name came with its own share of controversy, as Vorhees has been known for having trouble with the law, most specifically with the U.S. Securities and Exchange Commission (SEC).
After being involved in a scandal where Vorhees was charged with trading unregistered securities through two of his previous cryptocurrency websites, SatoshiDICE and FeedZeBirds, he reached a settlement with the SEC to not take part in offering public securities for 5 years in return to steer clear of any proceedings.
At the time of writing, Salt Lending, another cryptocurrency venture that Vorhees was associated with, is under investigation by the SEC for handling unregistered securities, as reported by the Wall Street Journal (Vorhees has denied any affiliations with the investigation).
However, that situation with the law evidently did not stop Vorhees from achieving success with ShapeShift, which is now one of the most widely known standalone cryptocurrency trading platforms, and through its API also gets integrated within an array of popular apps including but not limited to Blockchain (formerly Blockchain.info), Coinomi and Jaxx.
How ShapeShift Delivers Its Services
In its standalone version and its API that is integrated in those platforms, ShapeShift originally allowed its users to instantly trade between cryptocurrencies without having to provide any personal information. This was changed with the introduction of the ShapeShift membership program on September 4, 2018, which now requires every ShapeShift user to have an account on the platform and provide basic personal information.
On the other hand, it has always been the case that if someone wants to purchase cryptocurrency through fiat, then ShapeShift allows for that service with its verification procedure being handled by Simplex, the same payment solution platform that is used by Changelly.
These services are available through ShapeShift’s website, its iOS and Android apps, or any apps of the aforementioned kind that use ShapeShift’s integration within their systems.
In any case, in order to exchange cryptocurrency from the platform, you will be required to select your target cryptocurrency through ShapeShift’s website or app. This provides you with an overview of charges and the amount of desired cryptocurrency that you could receive against your existing asset (whether it is cryptocurrency or fiat).
You can then agree to the transaction cost, send your existing cryptocurrency to a ShapeShift wallet address or pay via credit card to use fiat, and provide your own pre-existing wallet address where you would like to receive your new cryptocurrency.
The process is completed within minutes – timing depends on the respective blockchain network’s speed. And that’s about it.
The Cryptocurrencies Being Offered By ShapeShift
At the time of writing, ShapeShift deals in 41 cryptocurrencies.
- Basic Attention Token
- Bitcoin Gold
- Ether Classic
- LBRY Credits
The platform also has other cryptocurrencies on its slate, but they are not available for trading at the moment. An updated list of traded cryptocurrencies can be seen here.
ShapeShift Membership Program – Which is Now Mandatory
Wait, wasn’t the whole value proposition of ShapeShift based on the fact that it does not require memberships or user accounts?
Apparently not anymore.
According to Vorhees, who announced a loyalty program for ShapeShift users in September 2018, ShapeShift noticed that there was a growing need of an account based infrastructure for frequent users of the platform, so that they could check their account and transaction history, save frequently used addresses and receive notifications.
The exchange service was also upfront about how incentivization through a token-based loyalty program would allow it to gather user information more easily, which has lately become a growing concern from a perspective of authority.
What ShapeShift did not mention was how those concerns were tied to a then-upcoming report in the Wall Street Journal about $100 million being laundered under its umbrella of complete anonymity for cryptocurrency transactions. ShapeShift later addressed the matter in an official blog post penned by Vorhees, in which the firm’s CEO mentioned that the Wall Street Journal’s account of the events was “inaccurate”.
Whatever the reasons might be, the fact remains that the loyalty program at ShapeShift remains very much functional. In the membership, registered users can utilize features such as discounts on exchange rates, higher transaction limits, and rewards in the form of the platform’s native token dubbed as FOX.
The membership in ShapeShift’s loyalty program is tier-based and segregated into 5 levels. While Level 1 is free and open to everyone who signs up for the program, the latter tiers are to be offered later on.
The FOX tokens are based on the Ethereum blockchain and have a total volume of over 1 billion tokens (1,000,001,337 to be precise).
But of course, as ShapeShift blatantly stated, one of the objectives of the membership program are to collect user information, which is why providing personal information is necessary. With the membership program going mandatory and in full effect from October 2018, ShapeShift has lost its distinction of being a cryptocurrency exchange platform with no requirement for account creation.
The Services Currently Offered by ShapeShift
While the change was drastic, ShapeShift still offers almost instant cryptocurrency trading to its users. Just the way before the requirement was implemented, you can open the ShapeShift app or head to the exchange’s official website, and enter the cryptocurrency you want to trade through the website. From there, you can create an account, and then proceed with making your trading transaction through the platform.
Buying Bitcoin and other cryptocurrencies through credit card is just as simple. However, this method requires verification. The verification process usually gets completed within a few hours and is done online. Once the verification is completed, you can move forward with buying cryptocurrency you’re your credit card.
ShapeShift does not define an external fee for its services apart from the miner fee that is paid to the respective blockchain network.
However, it profits from the exchange rate that is levied on each transaction. ShapeShift provides its own exchange rate which it claims to determine after referring to different market sources.
According to ShapeShift:
“We try to earn revenue by offering a profitable exchange rate, and typically we earn in the range of 0.5% (50 basis points).”
This basically means that ShapeShift charges an exchange rate of around 0.50%. The exchange also assures its users that once a trade is posted, the exchange rate offers no slippage and stays the same until the trade gets executed.
Another thing of note here is that since ShapeShift uses Simplex for credit card transactions, which is the same payment partner as Changelly, it will charge its own fee on top of whatever ShapeShift charges its users.
Thus, users who buy cryptocurrency from ShapeShift using credit card will have to pay an additional 5% in terms of Simplex’s fee. However, this is not clearly stated by ShapeShift until you have to pay the fee.
ShapeShift Security and Deliverance of Services
Despite the recent changes in its information recording mechanisms, ShapeShift remains capable in terms of maintain security for its users.
Even if the membership program records personal information, the assets that are traded through ShapeShift are sent directly to your provided wallet addresses instead of being held with ShapeShift itself. This means that you will receive your purchased or traded cryptocurrency right at your third party wallet without having to keep it with ShapeShift and withdrawing it later.
This method of not restricting your cryptocurrency to a ShapeShift wallet makes sure that your do not have to worry about ShapeShift’s security capabilities. Furthermore, when it comes to fiat deposits, you get exactly what you pay for, almost instantly. This also means that none of your fiat balance would have to be stuck with ShapeShift at any time.
One more aspect that adds to ShapeShift’s security is that it is the owner of KeepKey, a hardware wallet manufacturer. This means that ShapeShift has ample access to top of the line security features.
Changelly or ShapeShift? Which One Takes the Cake?
In terms of transparency, services, and an all-around holistic service, Changelly would be the better fit for an individual user. Changelly goes above and beyond not only in cryptocurrency offerings, but also in terms of fee transparency while providing almost the same services as ShapeShift while using the same credit card payment processor as well.
The one shortfall in Changelly’s service is that it does not have mobile apps for its users. However, with the use of third-party wallet services, this issue could be easily resolved.
As for ShapeShift, while it has been growing in popularity despite the repeated scandals that surround its founder and CEO, it does not provide as much transparency in disclosing its fees as Changelly does. With almost no difference in services or payment methods, it may be a prudent choice to use Changelly over ShapeShift whenever possible.