Explore our in-depth Poloniex review to determine the safety of this cryptocurrency exchange. Discover the key features and services of the platform.
The rapid developments in the cryptocurrency market and blockchain sector have introduced several crypto exchanges. Our focus today is on Poloniex, one of the longest-standing trading platforms in the USA.
This Poloniex review comprehensively explores all you need to know about Poloniex, such as its features, fees, supported cryptocurrencies, security measures, and more.
What is Poloniex?
Established in 2014 with headquarters in Boston, Poloniex is a cryptocurrency exchange known for its wide range of supported digital currencies and competitive trading fees.
The platform facilitates crypto purchases through various methods, including bank accounts, Visa, Mastercard, and Apple Pay. It caters to traders of all levels with user-friendly interfaces and decentralized exchange compatibility.
However, despite its appealing features, Poloniex faces drawbacks in security and regulation, receiving negative customer service reviews and experiencing two hacks. The U.S. Securities and Exchange Commission (SEC) has also taken regulatory action against it.
Considering these concerns, users may explore alternative exchanges with better security and customer feedback. It’s essential to note that, as per Poloniex’s customer agreement, the platform is not accessible in the United States.
How Poloniex Works
Poloniex is designed for trading cryptocurrencies, thereby allowing users to exchange various types like Bitcoin for Ethereum. With over 500 spot trading pairs, diverse trading options are available.
Unlike some exchanges, Poloniex doesn’t handle direct cryptocurrency purchases; instead, it facilitates buying certain cryptos through Simplex, a payment processing partner. While debit or credit card payments are accepted, fees can be high.
Users in supported countries can opt for lower transaction fees by using a Simplex bank account. Poloniex also provides futures trading, offering up to 100x leverage on major cryptocurrencies. Although crypto futures involve risks, Poloniex stands out for investors interested in this feature.
License and Regulation
Poloniex stands out as one of the few US exchanges operating under full regulation. It adheres to various financial regulatory bodies, including the Financial Services Authority (FSA) in Seychelles, the Financial Industry Regulatory Authority (FINRA) in the USA, and the Financial Crimes Enforcement Network (FinCEN) in the USA.
Poloniex Products and Services
Poloniex provides spot and futures trading, grid trading, card purchases via Simplex, and opportunities to earn products and NFTs. Though the user interface may not be too appealing, the exchange remains user-friendly, offering a diverse range of products.
The platform stands out for its futures trading, providing leverage up to 100X, making it an attractive choice for traders aiming to maximize profits through high-leverage trading, especially with cross-margin trading supporting maximum leverage of 3X.
Apart from futures trading, Poloniex provides spot trading for 400+ cryptocurrencies, including popular ones like Bitcoin and Ethereum, along with smaller altcoins.
Despite the not-too-great interface (when compared with other exchanges), the platform remains user-friendly, offering various products and features, including copy trading.
Ideal for traders seeking a reliable crypto exchange, Poloniex stands out with a daily spot trading volume exceeding $80 million. It caters to all skill levels and introduces the APENFT marketplace, perfect for digital art enthusiasts.
Poloniex provides a variety of features to accommodate both beginners and seasoned crypto traders. Let’s highlight some distinctive features that make Poloniex stand out.
Open-source trading interface
Poloniex provides a trading interface with open-source HTTP and WebSocket APIs. These allow you to access public market data and manage your account.
The private HTTP API enables secure account updates, while the WebSocket API delivers real-time notifications for both public market data and your account, aiding in well-informed trading choices.
Staking involves securing a blockchain network by locking up your cryptocurrencies, contributing to transaction validation.
Poloniex facilitates this process through its Earn account, where you deposit eligible cryptocurrencies for automatic staking. Rewards are regularly distributed, with various supported cryptocurrencies like:
Staking rewards vary by cryptocurrency. For instance, staking ATOM on Poloniex Earn can yield up to 17.01% APY.
Poloniex Exchange provides a flexible mobile app for both iOS and Android users. The app allows seamless trading and convenient management of your cryptocurrency investments.
Margin trading and lending
Poloniex provides margin trading and crypto lending services. With margin trading, users can borrow funds from the exchange for cryptocurrency trades, while lending allows users to loan their cryptocurrencies to others engaged in margin trading. In return, lenders receive interest on their lent cryptocurrencies.
Interest rates for margin loans on Poloniex vary based on the borrowed cryptocurrency and loan duration, generally ranging from 1-5% per year. Users can typically borrow 2-10 times the amount deposited in their margin trading account, depending on the specific cryptocurrency involved.
Poloniex, boasting a collection of 10 million non-fungible tokens (NFTs), plays a substantial role in the NFT market. This platform not only allows users to trade and discover NFTs but also empowers them to develop their unique crypto assets.
Deposit and Withdrawal Options
At present, Poloniex exclusively accepts cryptocurrency deposits, with no support for fiat currencies. The platform primarily facilitates trading in popular cryptocurrencies like Bitcoin, Dash, Ethereum, Litecoin, Monero, and Zcash. Additionally, it accommodates over 80 different altcoins.
When it comes to trading fees, Poloniex uses the widely-used maker/taker model, designed to promote liquidity.
Liquidity is crucial for Poloniex, given its support for over 80 diverse altcoins. Check the table below for an overview of the applicable maker/taker fees on Poloniex.
Lenders receive a flat 15% fee along with interest. Deposits and withdrawals, however, are fee-free.
What Cryptocurrencies Can You Buy on Poloniex?
Poloniex accommodates over 300 cryptocurrencies across sectors like DeFi, Gaming, NFTs, and Lending.
Popular coins include:
- Bitcoin (BTC)
- Cardano (ADA)
- Ethereum Classic (ETC)
- Bitcoin Cash (BCH)
- Ripple (XRP)
- Dogecoin (DOGE)
- Polygon (MATIC)
- Chainlink (LINK)
- Binance Coin (BNB)
- Avalanche (AVAX)
Explore the full list of supported tokens on Poloniex by visiting their official site.
Poloniex stands out as a highly secure cryptocurrency exchange, boasting a strong history of safeguarding assets.
While not SEC or FSA licensed, it prioritizes client fund safety through various measures like:
- DoS attack protection
- Cryptographic DNS cache protection
- Cold wallet vault
- Defense against strong attacks
- Registry locks
- Two-Factor Authentication
- IP lockouts
- Role accounts for privacy protection
Poloniex Customer Support
Poloniex stands out for its often-overlooked but excellent customer support. The exchange boasts a responsive team that promptly addresses your inquiries and offers swift solutions.
Poloniex vs Other Cryptocurrency Companies
When compared to various cryptocurrency platforms, Poloniex provides cost-effective transactions and a wide array of digital currencies. Yet, some users may favor an exchange with a more robust track record and reputation.
Poloniex vs. Coinbase
Poloniex charges fees ranging from 0.145% to 0.155%, while Coinbase’s fees vary from 0.00% to 0.60% based on trade volume.
Also, Poloniex offers lending, margin, and futures trading. Coinbase, on the other hand, focuses on spot trading at current market rates.
In addition, Coinbase is renowned for better security and regulatory compliance. Poloniex is not available to U.S. users, unlike Coinbase.
When choosing a cryptocurrency exchange, no one-size-fits-all solution exists. Take time to understand your priorities, compare fees, and prioritize account security features.
FCA’s Warning Against Poloniex
The UK Financial Conduct Authority (FCA) issued a warning aganst Poloniex and its operator Polo Digital Assets, Inc. on December 6, 2023. This action signifies the increased scrutiny of crypto-related entities that are not registered or regulated by global regulators.
The warning portrays the FCA’s dedication to protecting consumers and preserving the integrity of financial markets, especially as the digital assets sector experiences rapid growth. This development signals the escalating efforts of regulatory bodies worldwide to closely monitor the cryptocurrency industry.
The FCA, in particular, has been proactive in issuing warnings and guidelines to protect investors from potential risks associated with unregulated or non-compliant firms.
Conclusion: Is Poloniex Safe?
With a wide range of coins, different security measures, and features like margin trading and staking, it remains a popular choice for users of all levels.
The platform offers diverse solutions such as lending and copy trading that enhance the overall trading experience. It is suitable for non-U.S. citizens that are looking for a crypto exchange with a variety of trading pairs.
However, judging from the warning that the FCA issued against Poloniex, potential users are advised to exercise caution, conduct thorough research, and be informed about the regulatory standing of the platform.
If you have any information regarding Poloniex, its administrators, or those facilitators, please reach out to us.