Risk Management: Get your money out of POLONIEX now.
The infamous exchange has now raised multiple red flags and doesn’t appear to be secure anymore.
POLONIEX’ troubles seemingly began at the beginning of the altcoin bubble in the Spring when an enormous increase in trading volume on the exchange (due to lots of new money coming in) started to overwhelm its outdated trading engine.
Trading on the exchange started to become increasingly slow and difficult and users would frequently experience screen freezes and delays in trade executions. Despite these issues, POLONIEX would become home to he biggest community of crypto trolls and margin traders during the bubble.
In May, POLONIEX users started to experience more serious issues with the exchange in the form of withdrawal delays and unresponsive customer support. During the peak of the bubble, POLONIEX also kept a lot of traders locked out of their accounts, resulting in huge losses for those unable to close margin positions.
If this wasn’t enough to dissuade you from trading on POLONIEX, on August 1st the exchange changed its TERMS of USE and a few paragraphs caught my attention:
5- RISK DISCLOSURE STATEMENT
You are aware of and accept the risk of operational challenges. Poloniex may experience sophisticated cyber attacks, unexpected surges in activity, or other operational or technical difficulties that may cause interruptions in the Service. You understand that the Service may experience operational issues that lead to delays on our platform. You agree to accept the risk of transaction failure resulting from unanticipated or heightened technical difficulties, including those resulting from sophisticated attacks. You agree not to hold Poloniex accountable for any related losses.
9- ATTACKS ON BLOCKCHAIN NETWORKS
Poloniex does not have any ability to prevent or mitigate attacks on blockchain networks. With respect to its platform, Poloniex reserves the right to take the following commercially reasonable actions in the event of an attack: (i) If Poloniex is able to confirm that a Token active on the Platform has been compromised or is under attack, Poloniex may immediately halt trading, deposits, and withdrawals for such Token; (ii) if it is determined that such an attack caused the Token to greatly decrease in value, Poloniex may discontinue trade activity on such Token entirely. Poloniex does not have any obligation to engage in activity in relation to attacks on blockchain networks.
Resolutions concerning deposits, withdrawals, and User balances for an attacked Token will be determined on a case-by-case basis by Poloniex in its sole discretion. Poloniex makes no representation and does not warrant the safety of the Platform and is not liable for any lost value or stolen property, whether or not Poloniex was negligent in providing the proper security.
And my favorite, note the use of capital letters:
21- LIMITATION OF LIABILITY
TO THE MAXIMUM EXTENT PERMITTED BY LAW, POLONIEX SHALL HAVE NO LIABILITY FOR ANY DAMAGES OF ANY KIND (INCLUDING WITHOUT LIMITATION INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR TORT DAMAGES, OR LOST PROFITS) IN CONNECTION WITH YOUR USE OF THE SERVICES, EVEN IF POLONIEX HAS BEEN ADVISED OR IS AWARE OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT WILL POLONIEX’S LIABILITY FOR MONEY DAMAGES UNDER THESE TERMS EXCEED THE AMOUNT OF FEES RECEIVED FROM YOU DURING THE PRECEDING SIX (6) MONTH PERIOD.
Here you have it then, POLONIEX is not responsible to what happens to your coins and can suspend the service in case of a cyber attack at any time and leave you out in the cold.
The last time we saw that many red-flags was when Mount Gox went belly-up in 2014 because of an undisclosed cyber-attack that robbed the exchange of 744,408 bitcoins, rendering it insolvent and unable to oblige withdrawals.
Now, I am not saying that POLONIEX is insolvent or has been hacked or any of this, what I am saying is that the best course of action for every reasonable trader would be to withdraw the last of their tokens to their wallet or to an other exchange ASAP.
I personally use BITTREX for trading altcoins because it has way more tokens than POLONIEX and its trading engine has been solid so far.
Trade safe guys, and please follow and upvote if you like the content.
Dan @tradealert
Great write up, but fuck Polo they suck balls
Wondering if you suffer from blockfolio addiction too? - https://steemit.com/cryptocurrency/@cryptocoinclub/confessions-of-a-blockfolio-addict
Thanks for the upvote @cryptocoinclub, I used to stare at charts all days when I started trading but not anymore, I buy low, stay patient and have alerts on my phone. I already read and upvoted your article mate :)
Oh, man, recent btc surge, and movements of altcoins, is really unexpected! I guess I still have a lot to learn...
@deanliu Yeah man, Segwit has locked in on the network and BTC 's fundamentals are looking good, this is why I have been buying as much BTC as I can, if you're interested in trading altcoins, I've just posted an article on this and I'll write something on upcoming ICOs tomorrow :)
I sold all my btc below 3k. do you think I might still have chance to pick up some below 3k within months?
@deanliu I mean, everything is possible so yeah there is a chance BTC will go back down to these levels. right now though, it's looking very bullish but it's also very high so I wouldn't buy back immediately, wait for the market to dip then buy. Don't feel bad about taking profit though, there will be plenty of occasions to replenish your coffers. If you're sitting on lots of Steem, maybe consider diversifying into BTC long term because Steem is losing value on the Steem/BTC chart. Watch out for my next post on Bitcoin coming very soon :)