Beware! Kryptod 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.
Kryptod presents itself as a forex and CFD broker focused on cryptocurrency trading. But even at first glance, we find plenty of reasons to be suspicious – starting with the fact that the website is partly in English and partly in German. Further inspection leaves no doubt that we are in fact dealing with an online scam. Let’s take a detailed look at the clues that Kryptod is not a legitimate broker and should be avoided.
KRYPTOD 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.
According to the homepage of the website, there is a company named Kryptod LLC behind this alleged broker, which is part of Krypto Holding Ltd. Kryptod does not provide an exact contact address but claims to be licensed by the UK’s Financial Conduct Authority (FCA).
However, a check of the FCA database shows that this is not true. We have no proof that this company actually exists.
Further on in this review we will see that there is additional evidence that Kryptod is not a genuine UK based broker. But the false claims of a licence are more than enough reason not to trust Kryptod with your money.
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 FCA.
These brokers have to meet stringent requirements for financial stability and transparency of operations. They must provide clients with negative balance protection and to participate in a guarantee fund that covers up to GBP 85,000 of a client’s investment should the broker go into insolvency. These brokers are also required to keep their clients’ money segregated from their own operating funds in separate bank accounts.
KRYPTOD TRADING SOFTWARE
On the homepage of the website we see images of a trading platform, but after registering an account we see that this platform cannot be found anywhere. The dashboard only has simple charts with current asset prices. Kryptod does not have the technical capacity to facilitate trading in financial instruments.
This means that we are dealing with a low-effort scam targeting people without any experience and knowledge about financial trading.
If you use the services of a licensed broker, you will get the opportunity to use established software with advanced features and versions for all types of devices and operating systems. The most widely used trading 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.
KRYPTOD TRADING CONDITIONS
When you visit the website of a legitimate broker you will find proposals for different types of trading accounts suitable for investors with different preferences, as well as detailed descriptions of trading parameters – minimum deposit, order execution method, tradable financial instruments, leverage, spread, swap, commissions, etc.
On the Kryptod website, we see a list of four types of trading accounts, but the only parameter specified is a ridiculously high minimum deposit of 10,000 USD.
Most genuine brokers allow you to start trading with an initial deposit of 100-200 USD. Many leading brands offer beginner traders Micro accounts with an even lower minimum deposit.
Kryptod claims to offer cryptocurrency trading. But the FCA prohibits brokers from offering crypto derivatives trading to retail traders.
Further proof that Kryptod is not a genuine UK based broker is the claim that it offers deposit bonuses. All leading regulators prohibit the use of bonuses and promotions.
We also see a claim on the website that leverage of up to 1:400 is offered.
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 FCA, like EU regulators, limits leverage to 1:30 for trading in major currency pairs and even lower levels for more volatile assets.
Regulated brokers offer higher leverage only to professional clients who must meet very high standards for capital and experience and forgo the guarantees enjoyed by retail traders.
If you don’t qualify as a professional trader but are willing to take the risk of high-leverage trading, the most viable option is to use the services of an offshore affiliate of an established brand.
KRYPTOD DEPOSIT/WITHDRAW METHODS AND FEES
Legitimate brokers typically offer clients a wide choice of transparent payment methods, including bank transfer, credit/debit cards and established e-wallets such as PayPal, Skrill, Neteller or GiroPay.
But Kryptod only allows funds to be deposited through obscure and suspicious payment processors such as Mirhax, Moonpay and Charge money.
If the account has received a bonus, the withdrawal of funds becomes contingent on meeting high minimum trading volume requirements. Two completely different descriptions of these requirements can be found in the Kryptod documents.
According to one option, 30 times the amount of the bonus plus the deposit should be traded.
According to the other version, a number of lots equal to the amount of the bonus divided by three must be traded.
Kryptod also charges an outrageous monthly inactivity fee of 10% of account balance.
HOW DOES THE SCAM WORKS
Scammers who promise easy money without any effort are nothing new, especially on the internet. But given the excitement around bitcoin and cryptocurrencies in recent years, malicious actors have run rampant more than ever, capitalizing not only on people’s desire to solve their financial woes with a magic wand, but also ignorance and misunderstanding of how blockchain and complex financial instruments actually work.
If your curiosity is stirred by one of the many flashy websites promising easy riches, and you provide your contacts, you will soon be contacted by skillful and persuasive scammers who will convince you to start with a relatively small and “risk-free” investment. If you agree to this, you will be transferred to even more skilled at convincing scammers, who will persuade you to invest even more. Any money you give to such people is money you are unlikely to get back.
Any attempt to withdraw deposits or alleged profits will be hampered by numerous and significant fees, as well as harsh and often prohibitive conditions written into the terms and conditions – such as high trading volume requirements, unexpected “taxes”, or withdrawal fees as high as 10% or even 20% 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.