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

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Cryptop is one of the many websites on the internet promising to help you earn easily and quickly from cryptocurrencies. If that sounds too good to be true, that’s because it is. Like many of the aforementioned websites, the Cryptop is also completely anonymous, unauthorised and ultimately designed to scam people without the necessary knowledge and experience to trade financial instruments. It would be an obvious mistake to trust your money to Cryptop.

CRYPTOP REGULATION AND SAFETY OF FUNDS

When you visit the website of a legitimate broker you can expect to find clear and detailed information about the company that owns and operates it, where it is based and what regulatory regimes it is subject to. Cryptop doesn’t even disclose which company is behind the website. Even the Terms and Conditions and Privacy Policy do not mention the name of a legal entity.

There is no chance that such an anonymous website is authorized to offer financial services in a highly regulated jurisdiction like Switzerland, where it claims to be based. We were not at all surprised to find no information about the Cryptop in the Swiss Financial Market Supervisory Authority (FINMA) database.

A careful reading of the Terms and Conditions reveals that the anonymous company behind the Cryptop is actually based in Commonwealth of Dominica:

This offshore zone has become very popular with financial fraudsters. Although this country has a financial regulator – Financial Services Unit, It does not license or supervise forex brokers. This means that if you deal with a brokers registered there, they are completely unaccountable and you have no guarantees about the safety of your money – in fact, it is almost certain that they are scammers. The Commonwealth of Dominica also allows incorporation of totally anonymous International Business Companies (IBCs) which is very convenient for these scammers.

You should only trust legitimate brokers operating 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 UK’s Financial Conduct Authority (FCA), Cyprus Securities and Exchange Commission (CySEC), Commodity Futures Trading Commission (CFTC) in US or 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.

CRYPTOP TRADING SOFTWARE

In many ways, the Cryptop looks like a low-effort scam targeting people with no experience in financial markets. The website doesn’t even mention the most important trading tool – the software. At the time of writing this review, Cryptop only has a log-in form for an existing account, and the option to register a new one is not active. Therefore, we have not been able to verify if any trading platform is offered at all.

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 MetaTrader 5 (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.

CRYPTOP TRADING CONDITIONS

Another thing you’ll find on a legitimate financial services provider’s website, but missing from the Cryptop website, is comprehensive information about trading conditions. So you effectively know neither who you’re dealing with nor what the terms of the deal are.

The generic Terms and Conditions mention forex and CFD trading, but there is no mention of cryptocurrency trading, which is the advertised activity of the Cryptop. The only parameter specified on the website is 0.05% maker/taker fees. But we have no reason to believe that the Cryptop offers any real trade.

Cryptop also claims to offer a deposit bonus, a practice that is prohibited to brokers in regulated jurisdictions such as Switzerland.

CRYPTOP DEPOSIT/WITHDRAW METHODS AND FEES

Cryptop says the account can be funded via wire transfer, credit card, e-wallets or cryptocurrencies. We suspect only the latter is true. Fraudsters avoid conventional and transparent payment methods.

Cryptocurrencies are the payment method of choice for fraudsters because they provide a high level of anonymity and, more importantly, do not allow for refunds. While there are some legitimate brokers that accept Bitcoin, they do so alongside other transparent payment methods such as credit/debit card, bank transfer or popular e-wallets like Skrill, Neteller or Sofort.

The stated  minimum withdrawal amount is USD 50. Cryptop says it charges a fixed commission of 30 UDS for each withdrawal – an outrageously high amount, especially considering that legitimate brokers rarely charge transaction fees.

Another specified charge is an inactive account fee. It is in the amount of 100 USD and is charged every three months.

HOW DOES THE SCAM WORK

Unfortunately, the internet is full of scammers. In the age of cryptocurrencies, many of them pretend to be brokers and take advantage of people’s desire to get rich easily through financial instruments they don’t really understand.

Fake brokerage sites lure you in with promises to take on all the difficult and confusing aspects of investing for you. If you make contact with such sites, they will first convince you to make a small, “risk-free” investment of a few hundred dollars. Experienced scammers will then begin to persuade you to “invest” more and more money, and will even deceive you into believing that your initial investment is generating incredible profits.

But you will never see those profits or the money you deposited. These scammers hide behind fake names and offshore shell companies that are not subject to oversight and regulations like regulated brokers. They use cryptocurrencies or other shady payment methods that make refunding money difficult or often impossible. The terms and conditions of these sites are riddled with pitfalls that block withdrawals with impossible-to-fulfill conditions for minimum traded volume and extremely high fees reaching 10, 20 or more percent of the amount.

WHAT TO DO WHEN SCAMMED

If you find yourself in such a situation, you should be very careful not to fall into the clutches of other fraudsters while trying to recover your money. Offers from people on the internet who promise to get you your money back from scammers for an upfront fee are also one hundred percent scammers.

If you used a credit or debit card for the transactions to the scammers, there is some chance you can get your money back by requesting a chargeback. Visa and MasterCard allow this to be done within 540 days. But such a claim can be challenged if you have provided the scammers with documents such as a copy of your ID and proof of address.

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