Is Changelly Safe?
Ten years ago, no one would suspect that Bitcoin, and cryptocurrencies in general, would receive such widespread adoption and that there would be up to a few million people around the world owning and trading these coins today.
To do so, traders use different types of cryptocurrency exchanges who promise them liquidity, variety, protection of privacy, and protection of their funds. This is not an easy task, which is why most exchanges use not only internal but external security providers as well.
Research shows that over 79% of exchanges provide regular security training programs for their employees, employ multi-signature architecture (86%), and cold-storage systems (92%).
As part of our series of reviews on the security of various crypto exchanges, in this article, we’ll talk about the safety measures offered on Changelly, a popular European crypto exchange.
Changelly is a decentralized crypto exchange launched in 2015 in Prague, Czech Republic. The platform doesn’t have user restrictions based on geographic location but you need to take into account the regulations of your own country before you register for an account.
The platform’s CEO, Eric Benz, has been active in the field of finances, particularly cryptocurrencies, for over a decade. His experience has helped Changelly evolve into a popular and reliable exchange and has fostered partnerships with leading names in the crypto industry.
One of Changelly’s advantages is the great variety of cryptocurrencies that users can choose from. You can buy them with cryptos or fiat currencies (USD or EUR). If you use a different fiat currency it will be automatically converted by the platform.
Cards are accepted as a payment method as long as they’re Visa or Mastercard. However, you shouldn’t be surprised when Changelly adds a 5% commission and a 5% processing fee on credit or debit card purchases. To play it strategically, make a larger purchase at once.
Changelly’s biggest asset is the high level of privacy that users can enjoy. They don’t have to provide a lot of personal details to get started, sharing and verifying your email address is enough.
Changelly does what’s in its power to protect users from scams and money thefts. Although KYC checks aren’t compulsory to use the platform, Changelly reserves the right to ask a user to perform this check if necessary.
The exchange has a risk scoring system that observes the transactions, identifies suspicious activities, and flags these transactions. At this point, the transfer of coins is put on hold and the user is asked to perform an AML & KYC test by providing an ID card and proof of the origin of funds.
The two-factor authentication (2FA) is offered by the majority of exchanges on the market because it’s considered to be an indispensable layer of protection for your account. The method grants access to the user only after providing the necessary factors or locks for authentication.
Typically, the first factor is a strong password (something the user knows) while the second one is either a mobile device or a hardware authenticator device (something the user owns).
If you choose your mobile device, you would receive an SMS with a passcode (e.g. a six random digits) that you need to insert when logging in. Another option is to download an authenticator app such as Google 2FA which generates one-time passcodes. For higher-level protection, you can use a hardware device like Yubikey.
In case you have a problem with the 2FA and forget or lose your authenticator device, you should contact Changelly’s team at [email protected]
The Changelly website uses the HTTPS Protocol. HTTPS stands for Hypertext Transfer Protocol Secure, an upgraded version of HTTP that provides more security for Internet users. It’s a protocol used for exchanging data between the user’s web browser and the website they’re visiting.
This added layer of security is obligatory for websites nowadays, especially those that require login credentials and other sensitive data (e.g. logging into your bank account or checking your medical record or health insurance).
Multisignature is another feature used by Changelly in processing and confirming users’ transactions. It’s a technology that requires two or more signatures on cryptocurrency transactions before they’re broadcasted on the blockchain.
Multisignature transactions are also known as M-of-N transactions, where M represents the required number of signatures and N represents the total number of signatures involved in the transaction so far.
Even though Changelly is a non-custodial exchange, meaning that it doesn’t store your funds nor does it feature a software wallet, it’s integrated with a number of cryptocurrency wallets to make things easier for customers.
Changelly features a blog post where it recommends a couple of these reliable partner wallets:
This wallet offers support for over 90 digital tokens, provides 24/7 customer support, and encrypts your private key with no account setup.
A free wallet designed for storing and managing Ethereum and other ERC20 tokens.
Ledger is a hardware wallet that looks a lot like a USB stick. It’s considered to be one of the safest wallets because it keeps your private key offline, reducing the possibility of malware attacks.
We cannot argue against the safety of Changelly because this can be easily proved by the fact that it has never been hacked.
However, we notice that the platform doesn’t go that extra mile in designing new revolutionary features beyond the industry average such as 2FA, HTTPS data encryption, multisignature, and cold storage.
On the other hand, this isn’t unusual for a non-custodial exchange as Changelly doesn’t store any additional user funds or information. When it comes to purchasing or selling coins, this exchange seems to do its job well.
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Disclaimer: Digital currencies and cryptocurrencies are volatile and can involve a lot of risk. Their prices and performance is very unpredictable and past performance is no guarantee of future performance. Consult a financial advisor or obtain your own advice independent of this site before relying and acting on the information provided.