Mind the Risks of Broker Scams in Cryptocurrency Investment

Cryptocurrency has definitely become a popular asset among investors. Besides the much-talked-about Bitcoin, theres Libra, a cryptocurrency introduced this June by the social media giant Facebook. Facebook also plans to implement Libra on its messaging platforms WhatsApp, Facebook Messenger and Instagram. Meanwhile, FCA(UK) warned that investors who are unfamiliar with the field but expect to make a fortune overnight through trading cryptocurrency may be too confident about their understanding of the asset.

Mainstream cryptocurrencies have been on the rise lately. With Bitcoin once again exceeding US$10,000, many investors on the market increased their investment. However, many illegal brokers also use Bitcoin as a bait to lure investors into their traps, and FOREXBIT is one of such brokers. On its website, FOREXBIT claims to “offer private investors an easy and complete set of tools for their trading and investment”. By addressing clients as “private investors”, the broker apparently means to attract even more investors by creating them the impression that theyre receiving additional care and special services from the company.

According to WikiFX App, FOREXBIT has been in business for less than a year and doesnt use MT4/5 trading software. It has received low scores in terms of license, regulation, professional capability, risk control and software, leading to a poor rating of 1.19 on the WikiFX App. Investigation shows the broker is currently unregulated, bearing tremendous risks.

Notably, FCA(UK) had blacklisted FOREXBIT on August 29th this year and released its information on FCA official site. According to FCA, FOREXBIT had been providing financial services and products in UK without authorization, and though the broker claims to mainly serve British investors, offering comprehensive global investment services including forex trading, FCA clarified that FOREXBITs registration was fraudulent and the company has no permission to provide financial services in the UK.

Though cryptocurrency has gain wide appeal among both investors and business giants, regulators in most countries have been caution over the currency. As FCA mentioned, investors tend to overestimate their knowledge of this asset, so investors are not suggested to entrust your capital to any broker without carefully verifying its credibility first. If you have doubts about a broker‘s compliance, you can check the websites of regulation authorities for information, or download WikiFX App to view broker’s profile in a click. The App also offers investors exposures of illegal brokers to help investors make safer investment.