One of the promises of blockchain technology was to facilitate “trustless” exchange. In e­­­­ssence two parties could trade without requiring a trusted third party like a bank. Unfortunately, numerous scandals, such as the failure of Mt. Gox resulting in $450 million in losses, have damaged trust in this vision.

While it is certainly true that there have been numerous examples of “bad actors” within the cryptocurrency industry, it is not always true that crypto brokers are at fault. Crypto brokers are often unfairly tarred as scammers when in many cases the client is in part to blame.

One common problem is a failure to correctly read and follow the broker’s KYC (Know Your Customer) policies or withdrawals. As we note below it is important to fully understand the policies that you will need to follow as a client.

Here we look at how you can select a trust-worthy cryptocurrency broker and ensure you are able to safely trade and withdraw crypto.

#1 Read reviews

Start by carefully reading reviews about the cryptocurrency broker you are planning on using. Look through both any testimonials on the website itself and reviews on third-party websites. When evaluating the reviews, you should look at both the overall rating and the number of reviews. You should expect to see at least some negative reviews. As mentioned already cryptocurrency brokers are often unfairly criticized by clients who have failed to understand the broker’s policies. Clients who have lost funds through unsuccessful trades may also be looking for someone to blame. That said if a broker has a large number of similar complaints, then it should raise red flags.

#2 Trading volume

Trading volume can be another good indication of the standing of a cryptocurrency broker. In general, larger trading volumes, align with a more professional and secure operation. This is of course not always the case. At the time of Mt Gox’s collapse, it was the largest exchange in the market. Also, larger trading volumes can attract the attention of malicious hackers. Overall, though a reasonable level of trading volume is one criterion to consider.

#3 Withdrawal and refund policy

One of the most common causes of issues between clients and brokers relates to the withdrawal and refund policy. If you are using a broker like MGC Logic, these policies will be clearly laid out. Understanding under what circumstances you are able to withdraw funds and how long this process typically takes will avoid potential issues.

#4 Know Your Customer (KYC)

The cryptocurrency industry is under increasing scrutiny by regulators. This has meant that most brokers now require their customers to do fully identify themselves under KYC. Along with helping to prevent money laundering, these policies can also protect customers by making it harder for fraudsters to infiltrate a platform. You should be wary of a cryptocurrency broker that doesn’t have KYC policies in place. These leave them liable for prosecution by regulators which could see the loss of all of your funds. Make sure that you understand what is required for KYC by your broker. In some cases, you may be able to deposit and trade without undergoing KYC. But once you reach a certain volume or are withdrawing funds you may not provide further identification.

Ensuring a successful trading experience means educating yourself about the cryptocurrency platforms you are using. Take the time to research your cryptocurrency broker options and read through the broker policies carefully.