Our Backpack exchange review will break down everything you need to know about the exchange, from its inception to its key features, funding, the team behind the scenes, and security measures, we’ll delve into every aspect to give you a comprehensive overview. By the end, you’ll have a clear picture of whether Backpack Exchange is a good fit for your crypto trading needs or not.
Key Takeaways:
- Backpack Exchange is a safe and user-friendly place for trading digital currencies, with features like zero-knowledge proof storage and mandatory KYC ensuring your assets are protected.
- The Exchange offers low trading fees of 0.085% maker and 0.095% taker, making it cost-effective for users.
- Backpack Exchange only supports a limited amount of cryptocurrencies for trading. While it supports popular digital assets, particularly those on the Solana blockchain, the selection is not as extensive as some other cryptocurrency exchanges.
Backpack Exchange Review: At a Glance
| Name | Backpack |
| Type | CEX |
| Founded | 2023 |
| Supported Countries | Worldwide |
| Trading Features | Simple buy/sell with limit or market orders |
| Futures Trading | No |
| Margin Trading | No |
| Copy Trading | No |
| Supported Cryptocurrencies | BTC, ETH, SOL, and 21+ more |
| Supported Fiat Currency | USD only |
| Payment Methods | Wire Transfers and Credit/Debit cards |
| Trading Fees | 0.085% maker and 0.095% taker |
| Mobile App | No |
| Customer Support | Support center and support forum (email, discord, telegram) |
What is Backpack Exchange?
Backpack Exchange is a centralized cryptocurrency exchange (CEX) developed by Coral, the same creators of Backpack Wallet and NFT Mad Lads. Key figures behind the project include former colleagues with FTX: Can Sun (ex-general counsel) and Armani Ferrante (an ex-software developer at Alameda Research).
The exchange prioritizes security through innovative solutions. It utilizes a Zero-Knowledge Proof (ZKP) storage system combined with multi-party computation (MPC) for efficient and secure transaction verification across platforms. Additionally, it undergoes regular smart contract audits by independent security firms like OtterSec.
For regulatory compliance, it operates under a Virtual Asset Service Provider (VASP) license issued by the Dubai Virtual Assets Regulatory Authority (VARA). Currently, the platform offers spot trading, with plans to introduce advanced features like margin trading and futures trading in the future. The exchange mostly supports Solana ecosystem coins including other popular ones like BTC and ETH.
If you find this article helpful, give us a support by using this Backpack exchange referral link.
Note: The Backpack Exchange is still in beta version.
Funding
Backpack has secured a total of $37 million USD through two funding rounds:
- Seed Funding (September 2022): Backpack raised $20 million USD from prominent investment firms like Jump Crypto and Multicoin Capital. This initial funding provided a strong foundation for the platform’s development.
- Series A Round (February 2024): Backpack obtained an additional $17 million USD in a Series A funding round. This investment, led by Placeholder VC with participation from Amber Group and Wintermute Ventures, valued the company at $120 million USD. The fresh capital will fuel Backpack’s expansion strategy for the Backpack Exchange platform.
We're happy to announce our $17 Million strategic series A round led by @placeholdervc. pic.twitter.com/bn3EWsAIj5
— Backpack(@Backpack) February 28, 2024
The Team Behind
Backpack Exchange is the product of Coral, a leading crypto infrastructure company. This team, known for their work on the popular Mad Lads xNFTs, brings a wealth of experience to the exchange. Some other notable names are:
- Armani Ferrante (Founder): CEO of Coral, former software engineer at Alameda Research, former software developer at Oasis Labs, Counterfactual, and Apple.
- Tristan Yver (Co-Founder): Co-founder of Coral and former head of strategy at FTX.
- Can Sun (Project leader): Former FTX general counsel is leading the Backpack exchange project (source).
Backpack Exchange Pros and Cons
| Backpack Pros | Backpack Cons |
| Supports multiple Solana ecosystem tokens | Low trading volume and liquidity results in price slippage |
| VASP registration in Dubai brings extra security | No advanced trading tools like futures trading, copy trading, trading bots, and options trading |
| User-friendly interface | Limited supported cryptocurrencies |
| Non-custodial Backpack crypto wallet | |
| Low trading fees compared to other exchanges | |
| Airdrop campaign coming up |
Backpack Exchange Products and Services
Backpack Wallet
The Backback Wallet app is designed for users to manage their digital assets in a non-custodial way. It is a separate wallet from Backpack Exchange and is also built by Coral. The wallet emphasizes user control and security with its self-custodial model, meaning users hold their own private keys.
The app supports storing, sending, and collecting xNFTs across many platforms. It also supports 100+ popular Solana NFT collections. Beyond xNFTs, it functions as a regular crypto wallet supporting the swapping of popular tokens on the Solana blockchain. You can easily import existing wallets from other platforms like Metamask and Phantom for a consolidated view of your holdings.
The user interface appears streamlined, featuring a side-by-side panel for browsing, trading, and managing crypto assets within the app. You can also stake your SOL tokens and earn rewards.
If you find this article helpful, give us a support by using this Backpack exchange referral link.
Supported Assets and Trade
Backpack Exchange currently offers only trading for 21 cryptocurrencies and trading pairs. Most of the supported coins belong to the Solana blockchain ecosystem. It also supports Bitcoin and Ethereum with USDC pairings like BTC/USDC and ETH/USDC.
Some of the popular supported coins are:
- Bitcoin (BTC)
- Ethereum (ETH)
- Solana (SOL)
- USDT
- USDC
- RNDR
- PYTH
- TNSR
- KMNO
- JTO
The most actively traded pair on Backpack Exchange is SOL/USDC. This pair accounts for roughly 10% of the total daily trading volume. The exchange only supports limit and market orders.
Backpack Exchange Fees
Backpack Trading Fees
Backpack Exchange employs a maker-taker fee model, incentivizing users who add liquidity to the market (makers) with lower fees compared to those who remove liquidity (takers).
For regular users, Backpack charges a lower fee than the industry average. They offer a 0.085% maker fee and a 0.095% taker fee, compared to the typical 0.1% maker/taker fee charged by popular exchanges like Binance, Bybit, and KuCoin.
The trading fees are tiered based on your 30-day trading volume (USD):
| Tier Level | 30 Day Volume (USD) | Maker Fee | Taker Fee |
| 1 | 0 | 0.085% | 0.095% |
| 2 | >2,000,000 | 0.08% | 0.09% |
| 3 | >5,000,000 | 0.075% | 0.085% |
| 4 | >10,000,000 | 0.065% | 0.08% |
| 5 | >25,000,000 | 0.06% | 0.075% |
| 6 | >50,000,000 | 0.04% | 0.07% |
| VIP 1 | >100,000,000 | 0.04% | 0.060% |
| VIP 2 | >200,000,000 | 0.03% | 0.045% |
| VIP 3 | >400,000,000 | 0.01% | 0.045% |
| VIP 4 | >800,000,000 | 0% | 0.04% |
You can check out the full Backpack fee structure here.
Deposit and Withdrawal Fees
Backpack typically doesn’t charge deposit fees. This is a common strategy for exchanges to attract users.
However, it’s always a good practice to double-check the specific deposit method you plan to use, as there might be fees associated with certain payment gateways.
Backpack charges withdrawal fees that vary depending on the specific cryptocurrency. There’s no fixed percentage fee, instead it is “gas fees”. For example, they generally charge 1 USDC for withdrawing USDC or 0.0002 BTC for withdrawing Bitcoin. This is subject to change based on the network congestion of specific blockchains.
Here is the Backpack withdrawal fee structure:
| Asset | Network | Backpack Withdrawal Fee |
| USDT | TRC20 | 1 USDT |
| BTC | Bitcoin | 0.0002 BTC |
| ETH | ERC20 | 0.0014 ETH |
| SOL | Solana | 0.01 SOL |
| WIF | Solana | 0.25 WIF |
Backpack Exchange Security
- VASP License: The platform claims to be a licensed Virtual Asset Service Provider (VASP) by the Dubai Virtual Assets Regulatory Authority (VARA). This indicates some level of oversight by a financial authority.
- Know Your Customer (KYC): The Exchange requires users to go through KYC verification. This involves submitting a government-issued ID and proof of address documents. It helps prevent anonymous accounts and money laundering.
- Private Blockchain: Backpack Exchange is built on a private blockchain designed to run a crypto exchange. Private blockchains can offer some advantages over public blockchains, such as faster transaction speeds and more control over access.
- Security Audits: The smart contracts are audited by independent security firms like OtterSec. These audits by security professionals can help identify and fix vulnerabilities in the code.
- Two-Factor Authentication (2FA): This helps prevent unknown account access by implementing extra time-based codes like Google Authenticator.
Customer Service
For users with questions or running into issues on Backpack Exchange, their customer support team offers a few ways to get help. The first option is to browse their Help Center, which contains articles on a variety of topics related to using the exchange. This could be anything from how to place a trade to managing your account security.
If the Help Center doesn’t have the answer you’re looking for, it also allows users to submit a support ticket. This is a good option for more specific questions or if you need to provide the support team with additional details about your issue.
Finally, it offers email (support@backpack.exchange) support as another way to reach their customer service representatives. This can be a good option if you prefer written communication or if your issue is complex and requires a more detailed explanation.
Backpack Exchange Airdrop Guide
The Backpack Exchange airdrop has been conducted in phases, with three completed so far.
- Phase 1 (February 13th to March 18th): You received a $W token (Wormhole) as a reward. They distributed 27 million $W rewards to 300,000 people.
- Phase 2 (March 26th to April 6th): Phase 2 was distributed with a $TNSR token.
- Phase 3 (April 23rd to May 5th): Ionet $IO tokens will be distributed.
There might be a Phase 4, so stay tuned and check their official Twitter handle for more information.
How to Get Backpack Exchange Airdrop?
The Backpack Exchange Airdrop is primarily based on trading volume. Generally, having a trading volume greater than $5,000 makes you eligible for the airdrop. Therefore, it’s advisable to aim for as much trading volume as possible. Higher volume results in higher airdrop rewards. So, focus on increasing your trading activity to maximize your chances of receiving a significant airdrop reward.
In some cases, you may also need a Backpack Wallet to connect to specific platforms. For instance, in Phase 2, connecting to tensor.trade was necessary.
Here are the steps to participate in the Backpack Exchange Airdrop:
Step 1: Setting Up Your Backpack Account
The first thing you’ll need is a Backpack account. Head over to their website and click on “Sign Up”. They’ll ask for your email address and a secure password.
Once you’ve filled out the information, you’ll be good to go. Open your e-mail account and verify. Later, you need to choose between an “Individual” or “Business” account. Now, provide your personal details like name, address, date of birth, occupation, and more.
Step 2: Verify Identity (KYC)
KYC stands for “Know Your Customer” and it’s a standard security practice used by many crypto exchanges. To complete KYC, you’ll need to provide some form of government-issued ID, like a passport or driver’s license, and proof of address, like a utility bill. The verification process shouldn’t take too long, and Backpack Exchange will guide you through it on their platform.
Step 3: Deposit Funds
Now that your account is set up and verified, it’s time to fund it with some crypto. Go to the “Deposit” button on the top menu. If you already have cryptocurrency stored in another wallet, you can transfer it directly to your Backpack Exchange account. You’ll need to copy/paste your deposit address for the specific crypto you want to transfer on Backpack Exchange and then initiate the transfer from your existing wallet.
Note: It’s recommended to deposit USDC on the Solana network since trading pairs are available on USDC.
Step 4: Trade Crypto and Aim to Increase Trading Volume
With funds in your Backpack account, you’re ready to start trading. Got to the “Trade” section. Look for the crypto you want to buy (let’s say Solana) and the crypto you’re willing to pay with (let’s say USDC). Backpack Exchange will display them as a pair, like “SOL/USDC”.
Decide how much “SOL” you want and at what price. You can choose from two order types, market order (buying at the current market price) or limit order (specifying a price you’re willing to pay).
Once you’ve entered your order details, review everything carefully and confirm the trade. You will instantly receive the tokens in your exchange wallet.
Additionally, you can invite friends using your unique referral link. By doing so, you’ll receive 30% of the trading fees generated by the users you referred.
Conclusion
To sum up our Backpack exchange review, it stands out as a promising crypto trading platform. The exchange puts a lot of focus on security with features like zero-knowledge-proof storage and following the rules with a VASP license from VARA.
Even though it’s still in its testing phase, it’s gotten a lot of funding and supports popular digital currencies, especially ones in the Solana ecosystem. The simple interface, along with low trading fees and strong security measures like MPC and private blockchain tech, makes Backpack Exchange a good choice for both new and experienced traders.
If you find this article helpful, give us a support by using this Backpack exchange referral link.
FAQs
Who is the CEO of the Backpack Exchange?
The CEO of the Backpack Exchange is Armani Ferrante, who is also the founder of Coral, the company behind the exchange. He brings significant experience from his previous roles as a software engineer at Alameda Research and other notable companies like Oasis Labs, Counterfactual, and Apple.
How does Backpack Exchange work?
Backpack Exchange works as a centralized crypto exchange (CEX). Unlike decentralized exchanges (DEXs) that rely on peer-to-peer transactions, CEXs act as intermediaries, managing user funds and facilitating trades. The Backpack exchange works on a private blockchain. This leads to faster trade execution compared to the potentially slower confirmation times on a public blockchain network.
Is Backpack Exchange legit?
Yes, Backpack Exchange is considered safe and legitimate. It operates under a VASP license from VARA and undergoes regular security audits by independent firms. The exchange has over $12 million daily trading volume, reported by CMC. However, it is still in beta mode. This means the platform is under development, and you might encounter bugs or limited functionalities.
