Beware! Xchangebit is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
In today’s review we are going to discuss a company called Xchangebit and evaluate whether it’s risky to trade via this company. As per the company’s website, we find out that it trades in cryptocurrencies, such as Bitcoin, Ethereum, Ripple, Litecoin and others.
From the screenshot below, you can see that the company offers 5 trading accounts – Basic, Silver, Gold, VIP and Diamond. Opening an account is made really easy and basically in a couple of minutes you will be able to start trading. You can also go directly into trading just by clicking on Trading Floor option which takes you into the trading platform.
Xchangebit Regulation and safety of funds
From the company website we can see that the address of Xchangebit is in the Commonwealth of Dominica (as you can see from the screenshot below). You need to be aware that although trade in crypto currency is allowed in this country, this is an offshore zone with no clear registration and regulation laws. You need to carefully consider all risks involving a trade via such offshore company before making a decision whether to invest your money in it. Also, please consider the fact that although the company is registered in the Commonwealth of Dominica, the company’s telephone number shown on the website is for Estonia.
Now, the question is, would you choose to trade with a company like this one that looks suspicious or would you rather choose a forex company from a well-established jurisdictions with strict registration and regulation laws aimed at reducing the risk of traders being scammed? If you choose the latter, then we suggest that you familiarise yourself with the brokerage companies licensed by top regulating agencies, such as the Financial Conduct Authority (FCA) in the UK and the Cyprus Securities and Exchange Commission (CySEC) if you want some guarantee for the financial stability of the company and the security of trader’s funds. Here is a link to EU forex brokers with proven legitimacy. We recommend such brokerages because in order to register in the well-established jurisdictions they need to meet strict criteria regarding an initial capital of 730,000 euros for EU and UK and availability of compensation funds amounting to 20,000 euros for brokerages regulated by CySEC and 85,000 pounds for brokerages regulated by FCA.
Xchangebit Trading software
Xchangebit offers a Web Trader platform which is directly linked to ‘start trading now’ options. After you click on the ‘I agree’ button you are good to start trading. Let’s examine what this Web Trader platform has to offer (please see the screenshot below):
As you can see, on the lefthand side of the platform interface we see the types of crypto currencies you can trade with. This Web Trader platform does not offer traditional currencies. In the centre, there are some trading tools and an option to choose the timeframe of the currency’s fluctuation. This screenshot shows how ARDR/BTC fluctuates in a 24 hours frame. On the righthand side, you see that the minimum amount for a single deal is $25.
The leverage for cryptocurrency trade with this brokerage is 1:10. However, you will notice that with each account the leverage will increase exponentially in proportion with the initial deposit amounting to 1:40 for the VIP and Diamond account. We want to immediately point out that this leverage is very high. Please compare with the leverage cap of 1:2 for brokerages regulated by CySEC which aims to lower the risks of high volatility in this type of trade. So, be careful with your hard earned money and do not take unnecessary risks!
You may not be familiar, but in fact, genuine and legit forex companies prefer to use trading platforms, such as MetaTrader4 and MetaTrader5. Their main advantage is that they offer demo accounts which is a very useful tool for new and inexperienced traders. They can practice forex trade on the demo account until they gain knowledge and confidence before going for real. Other advantages of the above mentioned trading platforms are the availability of tools and instruments that help monitor the different positions and facilitate the transactions. We would like to mention the financial calendar, VPS, the app market and the trading signals (for a subscription fee). Of course, this does not preclude the list of tools and instruments these two very popular platforms have to offer. So, our recommendation is to select forex companies that offer those trading platform in order to save yourself some future troubles and risks.
Xchangebit Deposit/Withdrawal methods and fees
As per the company’s website (please see the first screenshot in this review) the minimum initial deposit for the basic account is $250. To fund your account you can use Visa, MasterCard or Bitcoin.
In the Withdrawal section of the Terms and Conditions document, we find out that the minimum withdrawal amount is $10 and no fees are charged for a withdrawal of up to $1,000. However, with the increase of the withdrawal amount, fees may raise up to $50 which is rather too much.
Xchangebit charges dormant or inactive account fee (an account without trading history for 60 days) of 10% of the account balance or 100 units of the account currency, whichever is the greatest. We consider this fee to be very high. Legit companies would normally charge not more than $20 and they will also have a longer, up to 6 months, inactive or dormant period. This is something that you should consider very carefully and choose a company with better fees than this one.
In case where the trader has accepted a bonus, which according to the various accounts may vary from 50 to 150% (see the first screenshot in this review), then the requirements as per the Bonus policy must be met. These requirements are that the trader must achieve a trading volume equal to Bonus Amount *20,000. For example, if you receive $500 bonus, then you will have to execute transactions amounting to $10,000,000 which is not something that easy to achieve.
Any withdrawals you wish to make will be charged with 20% fee of the requested withdrawal amount. Let us tell you that being able to meet the requirements of the bonus withdrawal policy is going to put too much pressure on you if you choose to accept a bonus.
How does scam work?
Nobody likes to be scammed but it happens because scammers are masters of deceit. They use many manipulative techniques to lure you to part with your hard earned money. Because admit it, it looks very tempting when you see an ad on the Internet or the social media promising you a quick and easy profit. It is easy to make a mistake and invest money into some scammers’ schemes. Scammers are smooth talkers and they know how to pull on the strings of our emotions and desires. They will promise you the world to a point where you start to believe them. However, after a while you will realise that the promised profits and riches are not around the corner and after living for sometime on an empty promises, you admit your mistakes and want a way out.
However, this is not so easy. The scammers will use some delaying techniques trying to persuade you to wail just a bit longer or even to invest more money. When this doesn’t work any longer, then they will try to delay you so you miss the period for chargeback.
What to do if scammed?
If you were scammed, we urge you to immediately file for a chargeback. If you have used a credit card to make your deposit, then there is some chance that you may be able to get your money back. Visa and MasterCard allow 540 days period in which to file for chargeback.
However, if you have used a bitcoin or a wire transfer transaction to do your deposit, chances are slim that you’ll get your money back.
Also, be aware that some so-called ‘recovery agents’ may approach you offering to get your money back for you. Please use caution as this might be another form of scam.