Beware! Kryptowize is an offshore broker! Your investment may be at risk.
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KryptoWize is a CFD brokerage pretending to be a cryptocurrency exchange registered in Gibraltar with lots of unclarity regarding its trading conditions. It provides a web-based trading platform and requires a minimum deposit of $250 which is about the industry average.
Crypto Kartal regulation & safety of funds
According to the website the company behind the brokerage is registered in Gibraltar with the name Rushtag Limited. Forex brokerages operating in Gibraltar – a British overseas territory – have to be licensed by the Gibraltar Financial Services Commission (GFSC). However, after doing a quick search on the online registry of the commission we could find no mention of such a s company on it. We can safely conclude that KryptoWize does not fall under any regulatory oversight whatsoever.
Furthermore, while researching the brokerage on the web we found that Belgium’s Financial Services and Markets Authority (FSMA) has blacklisted the website and warns potential traders that there may be fraudulent activities involved. Blacklisted websites should be seen by both seasoned traders and newbies as “no-go zones”. A warning issued by a national regulator is the clearest sign of trouble there is in the business.
The web-based platform of KryptoWize states that it does provide a demo account, however, after registering we couldn’t immediately access it due to waiting time for approval. This way we have no way to conclude the trading conditions the brokerage offers clients.
This is highly typical for scammers and we have come across it often while reviewing offshore brokerages. All that was outlined above inclines us to suspect that potential clients of the brokerage may be open to substantial risk.
We urge traders to exclude such risk in trading by only associating with brokers regulated by prestigious regulatory agencies, such as the FCA and CySec, which require compliance with a number of strict rules that give significant assurance for the security of the clients funds.
The segregation of accounts is among the rules which are especially important in the trading world, because it drastically lowers the risk of possible commingling.
Another is the participation in a compensatory scheme by which the client’s losses will be covered in the unlikely case the broker goes bankrupt or attempts to swindle traders.
KryptoWize deposit/withdrawal methods and fees
We could not even gather what the available payment methods are for clients from the brokerage’s website. This is, again, another typical feature of scammers.
KryptoWize openly states that it “may” charge an administrative fee of 5 percent/$25 on inactive accounts.
However, not all brokerages are as open with their withdrawal conditions, and without proper information on the website, we cannot be certain whether clients won’t be charged with any unexpected withdrawal or deposit fees once they invest. This is why we advise traders to always put up only the required minimum deposit, instead of risking a bigger amount with no certainty. Afterwards, they may also try to withdraw a small amount in order to check for any unexpected fees or delays. Such fees and delays are usually the signs of a scammer.
How does the scam work?
Information is a pretty solid criteria for judging a brokers legitimacy. Scammers would not share much of their information, because precisely there inconsistencies and irregularities may appear which expose the whole set-up. A good example is this very broker and the lack of crucial information about the company behind it.
After informing themselves for the brokers trading conditions – traders should be well-versed in the way of the scam:
Through clicking an ad with promises for fast money, you will be redirected to a website such as Bitcoin Evolution or Crypto Revolt where registration will require you to give your address, email and phone number. After sharing your personal information, you will being receiving calls from brokers, compelling you to invest with them and win big. After a few minutes hearing their pitches, you decide to deposit some $200-250. And just like that – the scammers take a fat commission from this initial deposit.
After they are done with you, senior scammers begin working you into putting even more money. They say it’s the only way to profit from trading even more. After making the mistake of investing even further, you’ll begin wanting to get out of this and withdraw what you have left.
Unfortunately, the con-artists have no such thing in mind. They will now begin persuading you to wait it out and not withdraw right now. The motive here is quite straightforward – traders have a limited time window for filing a chargeback with their bank and get their money back. The “recovery department” will simply want to mislead you into missing this crucial period and, along the way, losing any chance you might have of getting the money back.
What to do when scammed?
As was mentioned above, scamming is quite the common in the trading world and, sadly, even you might suffer from it. In such an unfortunate case there still may be some available options for you.
You may contact your bank or credit card provider and file a chargeback. Furthermore, due to the high instances of fraud – both Visa and MasterCard have decided to sidestep scammers as best they can in forex trading. The first thing we have seen so far is that MasterCard has increased the previous time period of six months for filing a chargeback to a year and a half with their rival Visa expected to follow suit in December.
If, however, you have provided the broker with your credit card details, immediately cancel your credit card.
If you have given information regarding your online banking pass – you should switch it asap!
Beware of potential calls from self-described “recovery agencies”! They prey on scammed and vulnerable traders who are desperate to recover their losses. They will require an “up-front” payment to help you, but after paying them, no such help will be coming your way!