Coolcrypto review – 5 things you should know about coolcrypto.online

Coolcrypto review – 5 things you should know about coolcrypto.online

Rating: 1

Beware! Coolcrypto is an offshore broker! Your investment may be at risk.

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Coolcrypto present itself as regulated ant award-winning forex broker. However, fact checking shows that this website is actually a part of a scam network that is illegally using the details of a legitimate brokerage firm. Under no circumstances should you entrust your money to Coolcrypto.

COOLCRYPTO REGULATION AND SAFETY OF FUNDS

On the website we can see the claim that Coolcrypto is a trade name of TopFX Ltd, a broker registered in Cyprus and licensed by the Cyprus Securities and Exchange Commission (CySEC):

There is even a link to the CySEC registration of TopFX Ltd, but it immediately shows that Coolcrypto is not among the brands and domains used by this company:

Coolcrypto also uses the TopFX’s Seychelles registration details, but claims they actually apply to Australia. This claim is unconvincing even at first glance because they left the flag and the name of Seychelles:

Moreover, Australia’s financial regulator is called the Australian Securities and Exchanges Commission (ASIC), not the “Financial Services Authority of Australia” as Coolcrypto website claims. A check of the Seychelles Financial Services Authority (FSA) registry confirms that TopFX uses domains for its offshore operations that also have nothing to do with Coolcrypto:

While the Coolcrypto website is made to look like the websites of the real broker, it is what is called a clone site. This is also not the only blatant clone of this broker – we have encountered a whole series of such scam copies, including Binacryptofx, MegaFXTrading and Bitswapfx. Most likely the same scammers are behind all these fakes.

You should only trust legitimate brokers that you can confirm operate in one of the established financial centres like the UK, EU, USA or Australia. There, the activities of brokers are controlled by powerful regulatory bodies such as Financial Conduct Authority (FCA), Cyprus Securities and Exchange Commission (CySEC), Commodity Futures Trading Commission (CFTC) and Australian Securities and Exchanges Commission (ASIC). Clients of these brokers receive protections such as negative balance protection and segregation of the client’s funds from the broker’s funds.

In the EU and the UK, brokers must also participate in guarantee schemes that cover a certain amount of the trader’s investment if the broker becomes insolvent. These guarantees amount to up to 20 000 EUR in the EU and 85 000 GBP in the UK. However, the likelihood of such a bankruptcy is low because regulators also have significant net capital requirements that companies must maintain – EUR 730 000 in UK and Cyprus, AUD 1000 000 in Australia and at least 20 million USD in the United States.

COOLCRYPTO TRADING SOFTWARE

Coolcrypto claims to offer trading software called cTrader, with versions for desktop, browser and mobile devices. However, the links to download the software are empty.

The link to the web-based platform actually redirects to the website of the legitimate broker, fondex.com. The same applies to links to Terms of Business and other legal documentation on the Coolcrypto website. Apparently Coolcrypto doesn’t even have an imitation of a trading platform.

Legitimate brokers offer clients a wide selection of trading software, including desktop, mobile apps and web-based platforms. The most widely used platforms in the industry are MetaTrader 4 (MT4) and (MT5). These platforms have established themselves as industry standard because they offer a wide range of features, including a variety of options for customization, multiple account usage, designing and implementing custom scripts for automated trading and backtesting trade strategies.

COOLCRYPTO TRADING CONDITIONS

Coolcrypto claims to offer only one type of trading account with no set minimum deposit. Legitimate brokers usually offer different types of accounts tailored to different needs of traders with different experience and capital. Many of them offer starter accounts with a very low minimum deposit.

According to the description of the trading terms on the website, Coolcrypto offers zero spreads and a 2.5 USD commission per side per standard lot of 100 000 currency units. These levels are in line with the average for this type of raw spread accounts. But it’s obvious that Coolcrypto doesn’t offer real trading because it’s not a real broker.

Further evidence of this is that the website lists a spread of up to 1:500. Such levels are not allowed in the jurisdictions in which Coolcrypto claims to be licensed. High leverage creates the opportunity for more significant profit, but correspondingly increases the risk of sudden and excessive losses. All leading regulators therefore restrict leverage for retail traders. The CySec, like all EU regulators and ASIC, limits leverage to 1:30 for trading in major currency pairs and even lower levels for more volatile assets.

COOLCRYPTO DEPOSIT/WITHDRAW METHODS AND FEES

On its website Coolcrypto claims that deposits and withdraws could be done “via bank wire transfer, various e-wallets, multiple credit cards and other payment methods”. WebMoney, Visa, MasterCard and Maestro are specifically mentioned:

However, in writing this review, we could not confirm whether some, if any, of these methods are indeed available. All functions in the Coolcrypto customer portal are blocked if the client has not confirmed their identity by providing a copy of ID – which is ironic for an anonymous website misusing someone else’s identity.

From what we have seen on the other clonе websites, it can be assumed that Coolcrypto actually only accepts cryptocurrency transactions. Scammers prefer cryptocurrencies because these transactions are not subject to refunds. If you’re interested in legitimate brokers that accept Bitcoin alongside other more transparent payment methods, check out this list.

HOW DOES THE SCAM WORK

The online space is full of ads promising easy money. They sound too good to be true, because they are not – they are outright scams. Many of these fraudsters pose as brokers and take advantage of the general public’s ignorance of the capital markets.

If you give your contacts to one of these scammers, they will start convincing you that they will multiply your money, with nothing required of you but to sit back and take profits. If you agree to an initial investment of a few hundred dollars, they will start persuading you to invest more and more.

But you will never get the promised profits or the money you deposited. Scammers have many ways to ensure this. First of all, they are hidden behind offshore companies, not subject to controls and regulations. For the money transfers they use shady payment platforms, direct bank transfers or cryptocurrencies that make recovering money very difficult and often impossible. The terms and conditions are always riddled with traps that also block your ability to withdraw your money, such as prohibitively high minimum trading volume requirements or withdrawal fees amounting to tens of percentages of your funds.

WHAT TO DO WHEN SCAMMED

Recovering money you have given to fraudsters is difficult and often impossible. Fraudsters always want you to provide them with documents such as a copy of your ID and proof of address so that they can claim that it is a legitimate transaction, agreed voluntarily between both parties. If the transaction is made by credit or debit card, you can request a cashback and hope for the best, but transactions via wire transfer or cryptocurrencies are not refundable.  It is important not to trust online offers from people who offer to recover your money in exchange for an upfront payment, because this is also a well-known scam.

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