The case of Poloniex (poloniex.com) is a rather peculiar one within the crypto currency industry. Considered by some one of the biggest Bitcoin exchanges, the operation has been derided by many over its relatively brief existence. It is therefore difficult to make any kind of a strong assessment regarding its legitimacy. It is certain that Poloniex do not aim to simply walk away with people’s monies, but at the same time, there are many who allege that they lost funds to various glitches at the site, and there seems to be unanimous agreement over the fact that the Poloniex support is not helpful in any way these days.
Launched at the beginning of 2014, the operation seemed to do well early on. Later though, it started fading away, and nowadays, on various forums, people talk about putting together a list “of the victims of Poloniex.” Such talk is never good news for any operator, and with Poloniex, this is doubly true.
What is Poloniex?
Poloniex is a crypto currency exchange, dealing with scores of virtual coins. It also allows margin trading. The “base currency” of the site seems to be Bitcoin, but in the exchange section, ETH, XMR and USD can be used as “base currency” too. The margin trading section relies solely on Bitcoin in this regard. In addition to these services, the site features a Lending section too, where clients can post their loan offers and loan requests. The disparity in the interest rates is obvious between the two sections though, and there does not seem to be a lot of action going on in general. While there are loan offers at rates of 0.0060% and above, those looking for loans do not seem to be interested in offering more than 0.0001% on 2-day loans.
According to one of its creators, the reason why Poloniex was launched is that they wanted to see NXT listed on a major exchange featuring candlestick charts and reasonable trading fees. These fees were set to a flat 0.2% at Poloniex in the beginning.
The initial draw of the operation was – in addition to its low fees – the slick interface and automatically executed market orders. The fact that miners can mine various virtual currencies directly to Poloniex, is obviously a plus as well.
Can I trust Poloniex?
Reading the latest user feedback, the answer to that unfortunately has to be no. There are just way too many problems with the exchange, and with support virtually non-existent, sorting out even the smallest of problems is a harrowing ordeal. As said above, the operator used to enjoy the trust of the public in the beginning, but that opportunity has clearly been wasted.
Promises and Features
Proclaimed the “world’s most active digital asset exchange,” Poloniex have taken special steps to make sure their clients’ funds are safe. Mishaps do happen in this regard too though. There are Poloniex users who claim that their two-factor authentication only works once. Attempting to log back in a second time is apparently futile.
According to Poloniex, the majority of user deposits are kept offline. Only the amount absolutely needed for active trading is kept online. The exchange apparently has special auditing programs running around the clock, monitoring the system for any suspicious activity. The site prides itself on not employing the fractional reserves model many banks do as they operate.
The Margin Trading section of the site features proper charts and even some indicators meant to help traders make heads and tails of prevailing trends and upcoming reversals. There’s a trade history available, a market depth indicator as well as a complete listing of all sell and buy orders, Traders can make their moves directly from the website, setting their prices, amounts, loan rates and stop-limits.
The same goes for the Exchange section too. The Lending section is much simpler though, as mentioned above.
Question Marks and Red Flags
This is where things really turn southward for this operator. The community feedback delivered through various forums and message boards is equally puzzling and scary. While some people say their withdrawals have been honored instantly, others complain of their accounts being locked, their funds vanishing and other similarly grave problems.
Whether or not these problems are intentional – in which case the operation is indeed a full-blown scam – is unclear. It might just be that the staff is overwhelmed by the amount of work they have to handle.
To make a long story short, Ploloniex cannot fully be trusted at this moment in time.
The complaints against Poloniex are plentiful and they run a wide range of issues, some within the limits of reason, others totally appalling. Many of the complaints are focused on the efficiency (or rather lack thereof) of the Poloniex support staff. Some clients claim that they are simply unable to have their accounts verified and thus to start trading bitcoins and other virtual currencies. Still others say that their Bitcoin/cryptocoin balances have simply vanished, while others have had their accounts locked, with support never bothering to answer any of their questions or to make moves to unlock them.
There is indeed a sizable category of clients who consider the operation a scam (Check out this reddit thread for an example.)
Poloniex Review Conclusion
Poloniex is a troubled operation. Whatever the reasons behind some of its debacles, it is clear that not all is right with this exchange. For the time being, you are definitely safer investing your bitcoins somewhere else.
What’s your experience with Poloniex? Feel free to comment below this review and share it with us.
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