CryptoAltum claims to be offering the highest leverage globally. Is this good for traders or is CryptoAltum leading you into a trap and exposing you to the risks of losing your hard-earned money? We dig deep to find out the truth about this broker.
CryptoAltum Regulation and safety of funds
The first warning signs appear when we see that the address of the company is in the Marshall Islands, an offshore zone for forex trade. This is the paradise for dodgy brokers as there is no financial regulator in this jurisdiction and practically every Tom, Dick and Harry can register a company on the Internet without having to set foot there. So, being from the Marshall Islands does not make this broker trustworthy at all and we advise you not to enter into any trading activities with it.
If you are looking for a legit and reliable broker, there are many options and we recommend that you research the links we provide below of brokers from the well-established jurisdictions of the US, Australia, the EU and the UK. Brokers in these jurisdictions are strictly regulated and there are many measures in place to prevent scammers from infiltrating their ranks. First of all, one of the main requirements for brokers is to be well-capitalised. This means that brokers in the US must invest $20 million, in Australia, 1 million AUD and in the EU and the UK, 730,000 EUR. If you are astonished at the astronomical amounts US and Australian brokers must invest, this is because their funds also serve as protection of clients in case of unfavourable events as there are no compensation funds or schemes in these two jurisdictions.
On the other hand, brokers licensed by FCA in the UK and CySec in the EU compulsory participate in compensation funds or schemes from which in case of bankruptcy the clients are reimbursed by up to 85,000 GBP per client in the UK and 20,000 EUR per client in the EU.
Other measures to protect clients’ funds include keeping them separately with tier-1 bank establishments, report transactions on a daily basis for the sake of transparency, provide protection on negative balance, etc.
CryptoAltum Trading software
CryptoAltum is a forex broker trading in forex, cryptocurrencies, metals and indices. The trading software of their choice consists of the MetaTrader 5 trading platform. MT5 is equipped with an excellent package of trading tools and instruments which makes it very popular among forex brokers. For example, it offers an auto trading option, trading signals which the traders can obtain for a subscription fee, code base with customs scripts, a financial calendar, an app market, etc. In addition to that, following the example of its ‘older brother’ MetaTrader 4, it offers excellent charting options that contain many charts, time frames, colours and even the option of creating customised templates. We can’t omit to mention the array of technical analysis indicators, such as Bollinger Bands, Fibonacci retracement, moving averages, etc., which help traders predict the future direction of exchange rates and make a profit.
If you take a look at the image below, you will get the idea of what the platform looks like. On the left is the menu with the trading instruments with their bid/ask price. Beneath is the navigator that opens the accounts, indicators, expert advisors, scripts and services. In the top horizontal bar is the menu for placing trade orders, algo trading and charting options.
In the middle of the screen is displayed the chart of the EUR/USD currency pair with the fluctuation in its price in a given time frame. From the bid/ask price we find out that the spread is 1.5 pips which is not high and is favourable to traders as the cost of transactions won’t be too high and they will be able to make a sustainable profit. However, true to their claim of offering the highest leverage globally, we see in the image with the account types information that the leverage is indeed sky-high – 1:500. Trading with such high leverage is not recommendable in the least as it amplifies the exposure to the risk of your funds and the financial loss which statistically happens to 70% of traders will be significant. Please note that it is not by chance that in the well-established jurisdictions that we mentioned above, there is a limit to leverage and it cannot exceed 1:30 in the EU and the UK and 1:50 in the US. Only Australian brokers enjoy unlimited leverage for the time being. However, new regulations in march 2021 will impose the same leverage cap as it is in the EU and the UK. Keeping low leverage is one of the measures of protecting clients’ funds.
CryptoAltum Deposit/Withdrawal methods and fees
CryptoAltum offers only one account believing perhaps that one size fits all. In the image below, you can see the specifications for this account showing the values for the commission which is zero, spreads and leverage. As per the information provided, there is no minimum initial deposit and the payment methods include exclusively payments in different cryptocurrencies – BTC, ETH, XRP, etc. Using only cryptocurrencies as a payment option is not in the clients best interest as they may have problems later on if they decide to file for a chargeback as we discuss in the last section of this review.
If you peruse the bonus policy of this broker, you will find out that the bonuses offered to the traders are not available for cash withdrawal, only the profits generated from the bonus once the profit is greater than $100. Also, to be eligible for a withdrawal, the trader must complete a minimum of 5 trades. For your information, legit brokers do not offer bonuses and this is how you can differentiate them from the fraudsters.
How does scam work?
Actually, it’s quite simple and people often fall into the trap of experienced scammers. We bet you have seen those attractive ads on the Internet promising big and quick profits over a short period of time. Just provide your personal information, and voila! The scam brokers are waiting for you and you will be inundated with phone calls promising easy profit. Tempting, right? You think ‘ok, I can spend $200-300 and see what profit it brings me’. Congratulations, you just provided a fat commission for your scammers that will be distributed down the food chain. Now you have ‘graduated’ to be handed over to a senior ‘broker’, a smooth talker who will try to convince you that there is no more perfect time like now to invest more money. After all, you want to make more profit, right? However, something starts to feel off and now you start asking yourself questions and all you want is to withdraw your money and get out fast.
Unfortunately, it is too late! Someone has pulled the cheese and you are trapped because scammers don’t give up easily. Scammers will do anything in order to delay you so that you miss the deadline for a chargeback.
What to do if scammed?
Our advice is to immediately file for a chargeback if you have been lucky enough to make your deposit via credit card. VISA and MasterCard allow for 540 days chargeback period, so you still have a chance to get your money back.
Things don’t look so good if your currency of choice has been Bitcoin or bank wire. In that case, you may have to wave your money goodbye.
There are some other things that you can do in case of being scammed – cancel your credit card if you have given your CVV code to the scammers. Also, erase any software from your computer that gives scammers access to your private data.
Be warned, as well, that some so-called ‘recovery agents’ may approach you promising to recover your funds for a fee. It could be another form of scam where scammers prey on your misfortune. Should you choose to use one, you must make sure that you are dealing with a genuine and legitimate agency by checking their credential and company’s information and transparency.
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