Bitstamp is now sending users emails to keep funds in their exchange?

[JeromeTash]

In what seems to be a desperate attempt to lure customers to keep funds in their centralized exchange, a Redditor posted a letter showing how Bitstamp wrote to him after he did the right thing of withdrawing his funds off the exchange.

Here it is;


Source

How did we get to this level? 

[TryNinja]

I wouldn't call it desperate. They know everyone is overly sensitive nowadays due to all recent events (as they should be), so it's a no-brainer to tell your users that you aren't running a ponzi, especially to those withdrawing funds.

If you don't have funds there, you trade less, they receive less revenue.

Of course, that doesn't mean you should keep your coins there (you shouldn't, in any exchange, ever).

[AmoreJaz]

I wouldn't call it desperate. They know everyone is overly sensitive nowadays due to all recent events (as they should be), so it's a no-brainer to tell your users that you aren't running a ponzi, especially to those withdrawing funds.

If you don't have funds there, you trade less, they receive less revenue.

Of course, that doesn't mean you should keep your coins there (you shouldn't, in any exchange, ever).

exactly! such email is just re-assuring their clients that they do care their customers and they are here for good business practices . just a normal statement from a business which are worried about their customers not using or getting out from their platform owed to the recent threats. but yes, we all know that we should not store our funds in the exchange. better secure it in your own wallets.

[Darker45]

Well, if I were the CEO or the president of Bitstamp, I wouldn't have approved of such a humiliating way to gain back customers. But even if this looks like humbly begging for their customers to "come back and deposit, buy, or trade," at the very least, they provide a number of seemingly valid reasons why they're better than other exchange platforms. It's up to their clients to be convinced or not. Of course, not all of the claims could be independently verified, but this is probably much better than attracting clients by paying millions to rebrand Miami Heat's arena to FTX Arena, or to enter into an expensive partnership with the Mercedes F1 Team, or to hire Kevin O'Leary as spokesman.

[DaveF]

I see it as the same as me getting a letter from a brokerage that I pulled my IRA from. As others have said, no funds means no trading, no trading means they are not making any money from you. Don't use a credit card for a while and get a 'use the card get this promo deal'. Pull all your moeny from a bank and get an offer to come back and get this kind of deal.

Nothing surprising about this, if you have had funds in there for a while and did some trades it's a normal business practice. Now that a lot of people are pulling funds out of exchanges I can see them being a bit more aggressive / proactive about sending the emails since yes, fewer people with funds on the exchange means less trades which means less revenue.

And lets face it, it costs $0.00 to send an auto generated email. Not like my bank that printed and mailed a credit card promo.

-Dave

[jrrsparkles]

It may look hilarious but it probably stopped decent portion of people from withdrawal or re deposit funds back into the exchange because they used some words like 100% regulated, will never reuse for other purposes,etc. The fact is " Not your keys not your cryptos" so don't fall for such attempts and the exchange is trying to survive when many people are withdrawing due to the FTX collapse but in general exchange is not supposed to where we hold our crypto assets, itd only for trading purpose.

[bbc.reporter]

I wouldn't call it desperate. They know everyone is overly sensitive nowadays due to all recent events (as they should be), so it's a no-brainer to tell your users that you aren't running a ponzi, especially to those withdrawing funds.

If you don't have funds there, you trade less, they receive less revenue.

Of course, that doesn't mean you should keep your coins there (you shouldn't, in any exchange, ever).

I very much agree. Bitstamp is the longest surviving Bitcoin exchange in the cryptospace. Whatever they have been doing, they are certainly doing it right. However, I would not be very shocked if some of those smaller exchanges suddenly begin emailing people informing them of a welcome back bonus similar to what gambling sites are doing to lure people back hehehe. This is normal practice for gambling sites but it would be a sign of desperation for exchanges, I reckon.

[crwth]

Those people probably know someone or have been affected by what has happened with FTX and are now finding ways to lessen the risk that they have, including putting their coins in their respective hardware wallets or wallets that they are in control of.

The exchange probably wants to assure its users how competent they are and how they will deal with the backlash of what happened. They are trying to retain customers.

This is probably the only move that they can make for now. I can't think of anything else. ^{(If I was part of a centralized exchange)}

[mu_enrico]

Well, if I were the CEO or the president of Bitstamp, I wouldn't have approved of such a humiliating way to gain back customers.

Not sure if it's humiliating since I frequently receive this kind of mail every time I stop a service (unsubscribe, uninstall apps, etc.). It is just an SOP when customers stop using your service.

For me, posts like proof-of-reserve, assuring 100% backed, and the like are more cringy than this "please come back" message. These crypto exchanges are run on a fractional reserve, what makes them different only about how high their leverage is.

[bittraffic]

The headline on some news sites was about Binance 50B withdrawals and people were laughing about it, but CZ just replied it was nothing compared to how much had been withdrawn during FTX collapse.

They were all only seeing Binance to be affected but pretty much all other exchanges experience the same as Bitstamp.
Bitstamp will not convince a lot of people just as they are not coming back to Binance as well. People already realize they can trade anyway even if the coins they have are on wallets capable of accessing swap platforms.

[Darker45]

I see it as the same as me getting a letter from a brokerage that I pulled my IRA from. As others have said, no funds means no trading, no trading means they are not making any money from you. Don't use a credit card for a while and get a 'use the card get this promo deal'. Pull all your moeny from a bank and get an offer to come back and get this kind of deal.

Nothing surprising about this, if you have had funds in there for a while and did some trades it's a normal business practice. Now that a lot of people are pulling funds out of exchanges I can see them being a bit more aggressive / proactive about sending the emails since yes, fewer people with funds on the exchange means less trades which means less revenue.

And lets face it, it costs $0.00 to send an auto generated email. Not like my bank that printed and mailed a credit card promo.

-Dave

How about we look at the other side of it? While they are indeed trying to make money and clients withdrawing funds means lesser income and they should do something about it, the context is obvious with what's happening to a number of centralized platforms. While they are a business, they are a business built on foundations laid by Bitcoin. While they are now doing things contrary to the spirit of Bitcoin, I suppose they are still believers of what Bitcoin means. I suppose they still believe in decentralization, 'not your key, not your coins', 'don't trust, verify', and other Bitcoin-related principles.

And while it is understandable that Bitstamp did this for the sake of the business, there was actually Kraken's Powell who advised to get funds out of exchanges. And while Kraken was a centralized exchange, Powell actually encouraged people to trade through peer to peer only.

And recently, there was also Paxful's Youssef who, despite having a custodial business, encouraged people to self-custody and keep funds out of exchanges including his own.


https://twitter.com/raypaxful/status/1601934200893997057

I'm simply saying, centralized platforms could be honest and call a spade a spade. Rather than making people believe that they are a safe platform, that their clients' money are guaranteed safu, that they have 1:1 reserve, that they are regularly audited, that they are keeping anybody's information private, and so forth, why don't they just set it straight that they are a risky platform and that everybody shouldn't be keeping funds in them except those they are willing to trade and lose?