Is Poloniex Safe? An Honest Review

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No matter the type of asset you’re investing in, you must mitigate risks in order to maximize profits. This not only involves being careful when trading assets, but also being cautious when it comes to choosing an exchange. To protect their investments, many traders are putting a lot of thought into which exchange to trade on, and determining whether or not it’s safe.

If you’ve been researching popular cryptocurrency exchanges, you might have come across Poloniex. As you do your research, you may be wondering, is it a safe platform to invest your money? Can you trust the exchange to protect your funds to the fullest extent? This post will go over how reliable and secure Poloniex is, and whether it’s the best crypto exchange for you.

Is Poloniex Safe? How is Poloniex Protecting Your Money?

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Poloniex is a highly secure and safe cryptocurrency exchange to protect your assets.

But it’s also important to be aware that the platform has a history of not following United States regulations.

For example, the Securities and Exchange Commission (SEC) charged Poloniex for operating an unregistered online digital asset exchange in January 2023. This means that despite operating as a trading platform, Poloniex failed to register as a national securities exchange with regulators. To settle the charges, Poloniex agreed to pay the SEC roughly $10.4 million.

Many investors may see this as a red flag. But despite this regulation issue, Poloniex is still considered to be a reliable exchange. This means that you don’t have to worry about the platform using your money because it doesn’t operate using fractional reserves. So, any money you deposit is yours, and not Poloniex’s. Therefore, those funds will be solely used for facilitating trades on your account, and nothing else.

How is Poloniex Regulated by Governments?

In the past, Poloniex was once regulated by the United States. However, in 2019, Poloniex headquarters moved from the U.S. to Bermuda for more regulatory flexibility. Therefore, Poloniex is currently not regulated by the U.S. government or any other regulatory body.

Has Poloniex Had Any Security Compromises?

Poloniex faced a cyber attack in 2014. Hackers stole approximately $50,000 in Bitcoins. As a result, the exchange was forced to reduce customer account balances by 12.3%. This is because the company wasn’t able to cover the losses.

However, the exchange’s leadership eventually compensated all users who had their balance deducted. But that wasn’t the only time the platform experienced a cybersecurity attack. Poloniex was hacked again in 2020, losing an estimated $4 million in cryptocurrency.

The platform has survived these incidents, and has since tightened its security. For example, since the hacks, Poloniex has implemented automatic auditing of the entire exchange and improved the security of all servers. Poloniex also uses two-factor authentication for account login and withdrawal authorization. Users must also confirm their email when making a withdrawal.

And as an additional precaution, Poloniex keeps the bulk of its clients’ funds in cold storage, which is a crypto wallet that’s not connected to the internet. This prevents hackers from accessing investors’ holdings via traditional means.

The Poloniex platform is also constantly monitored to detect any unusual activity. This is thanks to the platform’s auditing programs that work constantly, 24/7/365, monitoring the activity on the exchange. If anything is spotted, the program reports block it before it develops into a problem.

Can I Use Poloniex (Poloniex US) In the U.S.?

No, currently, Poloniex’s services aren’t available in the U.S. However, the exchange is available in many countries around the globe.

Countries that are prohibited from the exchange include:

  • Cuba

  • Iraq

  • Iran

  • Libya

  • Mainland China

  • North Korea

  • Ontario

  • Sudan

  • Syria

  • United States and US Territories (i.e. American Samoa, Guam, Northern Mariana Islands, Puerto Rico and US Virgin Islands)

If you live in any of the above countries, and attempt to create an account with Poloniex, the platform will recognize your IP address and prevent you from signing up.

Poloniex Security Rules

Poloniex provides security services and verification features for Level 1 and Level 2 accounts. For a Level 1 account, you can access unlimited trading, unlimited deposits, and $10.000 per day in withdrawals.

A Level 2 account comes with more features, including a $500,000 per day withdrawal limit, custom withdrawal limits, and margin trading. While both account levels provide two-factor authentication, two-factor authentication recovery, and account takeover (ATO) prevention, only Level 2 accounts require identity verification.

This means that to create a Level 1 account, all users need to do is enter their email address and create a password. Then, they’ll receive an account activation email that contains a verification code.

After entering the code, their account is activated. On the other hand, to have their account verified to Level 2, a user must undergo identity verification. Identity verification requires new account holders to verify their identity before account activation.

This involves taking a user’s:

  • Legal first and last name that matches the name on their ID

  • Full, current address

  • A selfie

  • An image scan of their ID

Poloniex might also request a user to verify their identity to complete certain actions. A user must take a picture of themselves, along with a handwritten note that reads “POLONIEX” and the current date. This lets Poloniex know that the photo is current, and makes it difficult for someone to fake an account holder’s identity.

Poloniex might also request a verification photo for:

  • Funds transfers

  • Name changes

  • Address changes

  • Disabling two-factor authentication

Two-factor authentication offers account holders greater protection against possible attackers attempting to log in to their accounts compared to just using a password.

Beyond these security measures, Poloniex also provides:

  • Protection against DoS attacks

  • Cryptographic signatures-based DNS cache protection

  • Role accounts to protect users private information

  • Registry lock to prevent unauthorized changes to the website

  • IP lockouts

  • Strong security against web attacks like robot infiltration

  • Protected cold storage

Poloniex Pros and Cons

👍 Poloniex Pros

Low trading fees

Large range of cryptocurrencies

Educational content

24/7 customer support

Has its own decentralized exchange

Unlimited deposits and spot trading without verification

Margin trading and funding

👎 Poloniex Cons

History of hacked accounts

Not available in the U.S.

No advanced order types

Is Poloniex Good For Beginners?

Poloniex is a reliable cryptocurrency exchange, and is a viable option for beginners. However, it’s important to note that there’s no way to buy crypto from fiat currency, which might be an issue for some traders. But apart from that, its user interface is very straightforward for those of all levels.

The layout may be a bit daunting if you’re just getting started on the exchange. So, although Poloniex may not be the simplest option for a complete beginner, you shouldn’t have problems with the platform if you’re a quick learner.

Summary

Poloniex is a viable option for many investors outside the U.S. looking for a reliable exchange that offers a wide range of cryptocurrencies to trade. Despite its security challenges in the past, Poloniex has improved security measures, allowing its clients to protect their assets.

With two-factor authentication account verification, 24/7 monitoring, and protected cold storage, Poloniex ensures its clients' funds are safe and protected from hackers.

Plus, the platform offers some of the lowest cryptocurrency trading fees on the market, margin trading, and a relatively simple user interface. However, Poloniex remains unregulated, so traders should use it with caution, and avoid leaving significant amounts of crypto assets on the exchange for prolonged periods.

Top 10 Poloniex Reviews

  • Poloniex

    thilanka

    06.01.2024

    Comment

    The user interface is outdated and cumbersome to navigate, leading to frustration when trying to execute trades quickly. Additionally, the exchange has faced security breaches in the past, raising concerns about the safety of users' funds. Overall, I cannot recommend Poloniex as a reliable or trustworthy crypto exchange option.

  • Poloniex

    Oskost

    16.10.2022

    Comment

    I tried several crypto exchanges, Poloniex turned out to be the worst. Commissions are skyrocketing. The interface is terrible compared to other exchanges. There are few assets for trading, new ones are not added, which indicates the company's unwillingness to develop. Swamp.

  • Poloniex

    Wenzelpn

    27.08.2022

    Comment

    The exchange has a small selection of assets and high commissions. The site is complex, the interface is incomprehensible, the trading platform works slowly. If you have any questions, you will not get through to the technical support service. I have a question about the delay in payment hanging for 2 weeks.

  • Poloniex

    lulatx60

    03.03.2022

    Comment

    Should I trade with Poloniex? Yes. But either for those who already have experience in trading, or for those who have tried and want to develop in this direction. The deposit in Poloniex is higher than in the market, the minimum is $50. But this is fully justified: I have never seen such cool, deep analytics and training materials on any crypto exchange. In addition to analytics for each instrument, a forum is also available here where you can chat with colleagues. In addition, there are pairs with fiat and the opportunity to earn on P2P. I am cautious about this way of earning, there are fewer buyers than creditors. Minus - there is no phone for quick communication with the joint venture, but there is mail and instant messengers, support is available 24/7.

  • Poloniex

    aliboukelia

    06.06.2021

    Comment

    Poloniex has become my home. I started trading on this platform a couple of years ago and thanks to the individual approach of the crypto exchange to traders, I was able to quickly get used to a new market for myself. It's very good that the company has Poloniex Learn, which is its own community of traders. Useful info constantly appears here, from analytics to current news. Considering how volatile the crypto market is, you should always keep your eyes open, and Poloniex Learn is a great help in that matter.

  • Poloniex

    gautam000yadav

    06.05.2021

    Comment

    To be honest, I didn't even think that I would return to crypto trading. I went bankrupt a few years ago with another exchange due to its hacking, then I lost a lot of dough. However, an acquaintance convinced me to return to cryptocurrency trading, now this is great hype. So he suggested Poloniex to me. The final argument in favor of this platform for me was that it has its own insurance fund. That is, all users are protected in case of force majeure and you do not have to worry about the safety of funds.

  • Poloniex

    kannupriya06

    04.04.2021

    Comment

    And I, with great apprehension, registered on the Poloniex crypto exchange. On the one hand, there is a simple and intuitive interface, you can get a loan, which expands the possibilities for trading, and in general, there are a lot of interesting buns for traders. But on the other hand, I heard from a close friend that in the past the company was repeatedly noticed in the needless blocking of user accounts. I thought for a long time whether it was worth contacting the exchange but still decided to take a chance. I don’t regret it, I’ve been trading here for six months and I’m not disappointed. The transaction fees are loyal, there is deep analytics and convenient technical tools, which simplifies the work on the crypto market.

  • Poloniex

    junglefish

    05.03.2021

    Comment

    Poloniex opened the world of crypto trading to me. I wanted to try my hand at trading digital currencies for a long time, but I could not find an adequate exchange. It seems like there are a lot of options to choose from, but I always found many disadvantages. But in the case of Poloniex, I think I am very lucky. From a technical point of view, I have no complaints about this platform. I mainly trade from a mobile phone, and everything is fine. There’s one more important nuance and that is the crypto exchange provides advanced analytics; you do not have to use third-party sources at all.

  • Poloniex

    saminstk

    13.01.2021

    Comment

    Unfortunately, I do not have much experience in crypto trading, Poloniex is my first exchange, so there is nothing with which to compare it. I registered on this platform at the end of 2020 when bitcoin exploded in price, and I have already managed to make good money. Recently I calculated that in less than six months I made about 10K dollars using Poloniex. What I like about it is the high liquidity and adequate commissions. For example, according to my second trading level, 0.0950% is taken for trades.

  • Poloniex

    bibian07

    06.10.2020

    Comment

    Well, each trading platform has its own strengths and weaknesses. And Poloniex is certainly no exception to the rule. For example, I do not like the fact that there is no telephone support. Strangely, such an advanced cryptocurrency exchange with a client-oriented policy did not take care that traders had the opportunity to have live communication with the support team. But at the same time, there is a gorgeous community of traders with all sorts of tutorials, a forum, news, and Poloniex Learn. Great respect to the company for all this.

FAQs

Is Poloniex for me?

Whether you’re just starting out trading crypto, or are a more advanced trader, you’ll find that Poloniex is great for traders of all levels. With educational tools for beginners and technical tools for seasoned traders, Poloniex is a versatile platform for any crypto investor.

Are there trading fees?

Yes, like many other crypto exchanges, Poloniex charges trading fees. However, these fees are some of the lowest in the industry. Poloniex charges:
- Futures trading fees
- Margin interest fees
- Lending fees
- Withdrawal transaction fees
Poloniex doesn’t charge fees for depositing crypto into your account. You can transfer funds between Poloniex accounts for free with off-chain transfers.

Is Poloniex safe?

Despite suffering security breaches in the past, Poloniex is one of the most secure cryptocurrency exchanges out there. The company was able to keep the damage to a minimum and was transparent to its customers.
Since these incidents, Poloniex has never lost any assets to cyber attacks, and has since improved its security structure with the latest security protocols and cold wallets for assets protection.

Does Poloniex offer margin trading?

Yes, Poloniex offers margin trading, which allows you to trade with borrowed funds. The exchange has a system set up that lets traders borrow money from other customers offering their funds as peer-to-peer (P2P) loans. This allows investors to amplify their potential returns (and losses).

Team that worked on the article

Johnathan Maverick
Financial Markets Expert

Johnathan M. is a U.S.-based writer and investor, a contributor to the Traders Union website. His two primary areas of expertise include finance and investing (specifically, forex and commodity trading) and religion/spirituality/meditation.

His experience includes writing articles for Investopedia.com, being the head writer for the Steve Pomeranz Show, a personal finance radio program on NPR. Johnathan is also an active currency (forex) trader, with over 20 years of investing experience.

Johnathan has been doing freelance writing – primarily on finance, small business, and investing – for over 20 years. He has ghostwritten several books, including complete guides to forex trading, spiritual autobiographies, and a book on cosmetic dentistry. He has also done a lot of editing and proofreading work (the Corporate Finance Institute hired him to edit over 2,000 existing articles on its website). In addition, he has published one novel – "A Cross of Hearts" (available on Amazon).

Johnathan’s experience includes writing 5-10 articles per week for Investopedia.com for about two years, and being the head writer for the Steve Pomeranz Show, a personal finance radio program on NPR. He is an active currency (forex) trader, with over 20 years of investing experience, having worked as a broker, financial advisor, and personal investing tutor. He has written literally thousands of articles and blog posts on an extremely wide variety of subjects, including virtually every conceivable investing/trading topic.

Peter Emmanuel Chijioke
Contributor

Peter Emmanuel Chijioke is a professional crypto, blockchain, NFT, Metaverse and Web3 writer, and a contributor to the Traders Union website. With a background as a top programmer and a computer science graduate, Peter has been writing articles related to crypto, blockchain, and related technologies since 2018.

Mirjan Hipolito
Cryptocurrency and stock expert

Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO). Mirjan is a cryptocurrency and stock trader. This deep understanding of the finance sector allows her to create informative and engaging content that helps readers easily navigate the complexities of the crypto world.