This review concerns Poloniex, an online exchange platform that offers services regarding cryptocurrencies. The information that you will get from this article will help you choose the best option available to you as a trader.
The investigation contains personal take on the online business, with pros, cons and concluding remarks serving as a general remark on the exchange.
About the Exchange
The exchange is of unknown origin, as the owners are yet to reveal themselves to the public. Founded in 2014, the platform operated anonymously, although it did register itself with Crimes Enforcement Network (FinCEN) as a money service business (MSB) in 2016.
The exchange services revolve around cryptocurrencies only, while fiat money is not part of the trading program, much like in Binance, Bittrex, and Bleutrade. Crypto market holds over 70 coins, with new ones added on daily basis.
Poloniex offers margin trading and lending markets. The margin trading platform offers leverage and limit/market functions, as shown below.
The lending program is a platform that puts the exchange at the higher end of the market, as many other businesses like Binance, Coinbase and CEX.io do not offer it. Apart from a web-browsing version, traders can download mobile apps (iOS and Android) for free.
The lending platform is shown in the snapshot below.
Registration and Verification
Registration is a simple process of you providing your email and password. It is free of charge to have an account at Poloniex. You do need to verify your account to have withdrawals of coins possible. Unlike many other platforms that require identity check like Coinbase or Bitfinex, at Poloniex, you have to open a webcam and take a picture of yourself holding the documents. Thus, Poloniex is even less privacy-friendly than large companies in the industry.
Poloniex’s services are available globally, as anyone with coins can participate in both margin trading and lending markets. There is an abundance of choices when it comes crypto wallet services, thus no regional limitations are set at the moment.
Deposit/Withdrawal Methods and Fees
At Poloniex, you cannot deposit or withdraw fiat currencies since the exchange is specialized in crypto-to-crypto trade only. The deposits are carried out free of charge while withdrawals have network fee that differs from coin to coin.
Other than withdrawal costs, Poloniex implements maker/taker fee structure as well. The costs vary from 0% to 0.15%, based on achieved monthly volume.
It is worthy to mention the fact that Poloniex was hacked in 2014 by a group of cybercriminals, resulting in 12% of bitcoins stolen. Even after the incident, the company did little to alleviate fears, as only two-factor authentication (2FA) is available. Bitfinex was also hacked, prompting the company to improve its security network, something Poloniex did not replicate.
Pros and Cons
+ large choice of crypto coins
+ services globally available
+ the lending market
– fiat currencies are not accepted
– owners of the exchange are not known since the foundation
– the hacking incident in 2014, resulting in 12% of lost funds
Poloniex is geared towards professionals and traders with history at the crypto market, with beginners being advised to seek other means to learn about the trade. The major drawback of the exchange is the low-level security, which has not improved since the hacking incident in 2014.
In addition, owners are yet to reveal themselves to the public, meaning that responsibility will not be fully taken in case of another incident. We would advise you to keep the investments low at this exchange for that reason.