Beware! Xtradebank 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.
Xtradebank is one of many scam websites trying to capitalise on the hype around cryptocurrencies and people’s desire to generate passive income. Let’s look in detail at what are the signs by which you can recognize that Xtradebank is not “user-friendly platform built for everyone” as it presents itself.
XTRADEBANK REGULATION AND SAFETY OF FUNDS
If a financial services provider is legitimate, you will find on its website clear and detailed information about the company that owns and operates it, where it is based, and what licences it has. Genuine brokers also provide access to a comprehensive set of legal documentation. The availability of such information does not guarantee that it is not false or misleading. But the absence of these elements is very indicative that in all likelihood you are dealing with scammers.
The home page of the website does not provide any specific information – there is no company name or contact address. In the Terms and Conditions we see the statement that the company behind the website bears the dubious name Xtradebank.com Finance LLP and is based in the United States.
The United States is a jurisdiction with particularly high regulatory requirements for financial services providers, which is why only a small number of large companies hold the necessary licences. Xtradebank is definitely not one of them. No variation of the name Xtradebank can be found in the National Futures Association (NFA) database.
If you intend to invest in financial instruments, you should beware of the many fake brokers lurking online. Always check carefully whether the broker you choose really has the necessary licences. There are numerous benefits to working with a company that is truly authorised and supervised by a regulatory institution such as the Cyprus Securities and Exchange Commission (CySEC) or Financial Conduct Authority (FCA) in the UK.
As their customer you will enjoy a number of guarantees including negative balance protection and guarantee for your funds if the broker goes bankrupt, which goes up to EUR 20,000 in EU and 85,000 GBP in the UK. Regulations in the UK and EU include some important measures designed to improve investor protection and promote market integrity and transparency, such as transaction reporting. Regulated brokers are also required to segregate their operational funds from the client’s money.
XTRADEBANK TRADING SOFTWARE
Xtradebank’s website doesn’t even mention trading software, which in itself is very telling. After registering an account, we get access to something that looks more like an imitation than a real trading platform. The platform in question lacks basic functionality such as options for placing pending orders.
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.
XTRADEBANK TRADING CONDITIONS
Given the lack of legal authorization and proper trading software, it makes no real difference what trading terms Xtradebank claims to offer. But the trading parameters listed on the website provide us with further confirmation that we are dealing with scammers.
The most obvious clue is that Xtradebank promises leverage of up to 1:100 when trading cryptocurrencies.
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. Due to their volatility, cryptocurrencies are subject to the strictest restrictions. In the US, the maximum leverage allowed when trading cryptocurrencies is 1:5, while in the EU and other regulated jurisdictions it is only 1:2.
Xtradebank also promises a welcome bonus and referral commision if you attract other people to the scheme. Regulated brokers are prohibited from soliciting customers through bonuses and promotions.
The only other information regarding the terms of the alleged trade is that Xtradebank charges Maker and Taker fees of 0.20%.
In any case, it would be wiser to trade financial instruments through a licensed broker, many of which require a very low minimum deposit.
XTRADEBANK DEPOSIT/WITHDRAW METHODS AND FEES
As one would expect from a scam centred around cryptocurrencies, this is the only payment method available.
Scammers prefer cryptocurrencies because these transactions are not subject to refunds. While there are some legitimate brokers that accept digital currencies like Bitcoin, they do so alongside other transparent payment methods such as credit/debit card, bank transfer or popular e-wallets like Sofort, Neteller or QIWI.
The Client Agreement outlines numerous fees charged by Xtradebank – from 1% to 2.5% of each deposit, an additional 3.5% for “tax payments” and a 2.5% “insurance premium.” Legitimate brokers do not charge such fees. These outrageously high fees are an obvious scam trap.
HOW DOES THE SCAM WORK
Trading in financial instruments is a risky business even for experienced investors using the services of reliable brokers. For newcomers, there is also the risk of being deceived by the many scam websites posing as brokerages. These websites are operated by skilled and cunning scammers who lure you with promises of easy profits. Usually these scammers promise to take care of all the bits and pieces of investment for you, but many even use real trading platforms to fool you that your money is really being invested. After investing an initial low amount, they will convince you that you are already making incredible profits and urge you to invest more.
But your money is not invested and you will never see the promised returns. When you ask to withdraw even a portion of your money, you will be surprised by impossible to meet minimum trading volume requirements and hidden fees that amount to tens of percentages of your funds. Scammers hide behind fake names and offshore companies that are uncontrolled and unregulated, so it will be impossible to hold them accountable.
WHAT TO DO WHEN SCAMMED
If you find yourself in a similar situation, you can request a chargeback. However, this option is only possible if you have used a credit or debit card for the transactions. Visa and MasterCard allow this to be done within 540 days. But if you have provided the scammers with proof of identity, such as an ID or proof of address, these claims can be disputed. Bank wire transfer or cryptocurrency transactions are non-refundable.
In any case, you should inform the relevant authorities in your country about the activities of the scammers and warn other potential victims online. You should not trust offers to return your money for an upfront fee. This is also a known scam and all testimonials from satisfied customers are fake.
