We would advise against conducting business with Kaspitrade, as they are a dubious broker. They share many characteristics with other trading-related scams. If you read my Kaspitrade review, you’ll see all the red flags and understand why I wouldn’t recommend this broker.
The first indicator is the ostensible leverage they provide. Similar to LBLV, Kaspitrade is a scam because the leverage they offer is illegal for UK-regulated brokers to use.
Authorization and Guidelines for Kaspitrade
As far as we can tell, Kaspitrade is not based in the UK. In the website’s footer, they list an address in the United Kingdom.
It wouldn’t recommend dealing with a broker who operates out of their home. However, numerous additional red flags suggest Kaspitrade could be fraudulent. Kaspitrade lists a British address but asserts it is authorized by the Financial Services Board (FSB), the former name of a South African governing body.
Other than that, the name “FSB” is not used by any British financial authority. No details about Kaspitrade were to be found on the FCA website. Therefore, Kaspitrade is dishonest about being regulated. There is no legit documentation for it. Because of this, Kaspitrade is an unlicensed broker that is breaking the law.
Avoid dealing with unauthorized brokers who lack proper licensing. To protect their client’s best interests, licensed brokers must adhere to a set of rules and regulations. Even if your broker turns out to be a fraud, you will be reimbursed thanks to the robust insurance coverage offered by FCA and CySEC. I would not suggest dealing with unlicensed brokers because their insurance plans and rules only apply to licensed brokers.
Trading Conditions on Kaspitrade
Being an unauthorized broker is only the beginning of the problems. There is a mountain of evidence suggesting that Kaspitrade is fraudulent. To better grasp these, consider the following:
Kaspitrade is an online trading platform with a unique web interface. There is a lack of transparency concerning their trading platform. Since there is no telling how well (or poorly) custom trading platforms will perform, I do not advise using them. Furthermore, untrustworthy brokers maintain bespoke trading platforms to manipulate prices as they see fit and defraud their customers.
For this reason, we only endorse brokers running MetaTrader 4 or 5. Those platforms are trusted and frequently used because of the many features and advantages they offer.
Such advantages are not available on a proprietary platform, like the one Kaspitrade uses. In addition to the aforementioned lack of quality assistance, custom trading platforms frequently experience numerous technological issues.
Put Down a Bare Minimum
Kaspitrade has a rather high minimum deposit requirement of $500. Brokers that have been properly vetted and licensed will typically accept as little as $10 in initial capital. You can imagine how greedy the Kaspitrade founders must be to insist on such a hefty minimum deposit.
In addition, after the initial $500 investment, the minimum amount you can contribute to your account is $250. Clients of licensed brokers are free to deposit any amount they see fit. Another indicator is that Kaspitrade is fraudulent.
To quickly and easily take a large sum of money, shady brokers maintain extremely high minimum deposit requirements. The minimum deposit required by reputable brokers is kept low so that potential customers can try out the service with little risk.
Brokers who don’t stand behind their work don’t want you to try competing firms. Most of the time, they’ll want a sizable deposit before you can begin trading, and they won’t allow you to get that money back. Their con operates in just this way.
If a broker requires a large initial deposit before you can make a trade, go elsewhere.
Influence and Exposure
Kaspitrade’s leverage ratio is a static 1:200. Since FCA-regulated brokers are not permitted to offer leverage higher than 1:30, this is evidence that Kaspitrade is not a legitimate brokerage.
High levels of leverage, such as 1:200, are extremely dangerous. A loss of this magnitude would put you 200 times deeper in debt to your broker.
A high ratio of debt to equity is extremely risky. For this reason, broker leverage in the United States and Canada is capped at 1:50 by law.
Kaspitrade has a spread of 4 pips on the EUR/USD currency pair. Not only that, but the spread they offer is variable and can reach 8 pips. To give you an idea, 1 pip is the norm in the business. Risky, excessive spreads like these are never offered by legitimate brokerages.
Kaspitrade Fees and Accepted Payment Methods
A broker’s payment options and costs might reveal a lot about the service’s trustworthiness. Kaspitrade’s murky terms of service are a red flag that it is a scam.
Methods of Exchange
WebMoney, wire transfers, and major credit cards can all be used to fund your trading account with this broker. Since wire transfers cannot be reversed, they are frequently used by unscrupulous brokers.
You should only put money into your trading account with plastic.
Costs There are no costs associated with making a withdrawal on Kaspitrade. It came as a big shock. However, the lowest withdrawal amount that can be made using a credit or debit card is $100. Wire Transfers, on the other hand, have a lower threshold for withdrawals of $500. Keep in mind that reputable brokers will not impose such limits on their customers.
The possibility of inactivity fees is mentioned in the terms and conditions, but no information on the fee itself is provided. The broker can essentially charge you anything they want as an “inactivity fee” under these circumstances. They can even steal your entire savings without getting caught.
Bonuses
Another red flag that Kaspitrade is an unregulated broker is that it advertises bonuses. Clients of brokers authorized by the FCA are not permitted to receive trading bonuses. Brokers might restrict and trap customers through unethical means with the use of these advantages.
These bonuses do not provide you with free money but rather increase your leverage, making your trading circumstances worse. To withdraw your funds from Kaspitrade, for instance, you must have executed 25 times the bonus and the deposited amount minimum. The difficulty level here is so high that they may end up with your hard-earned cash.
Can I Trust Kaspitrade? Yes!
Untrustworthy brokers like Kaspitrade use advertising and bonuses to attract customers. They put shady clauses in the small print of their terms and conditions, where few customers will ever look.
Attractive incentive offers are what entice people to these brokers’ websites, but once they deposit money, they often run into withdrawal issues. In reality, these brokers are stealing from their clients under the pretense of exorbitant fees. They also have no legal recourse because the individual has agreed to the terms and conditions. Unsavory middlemen have made a home in St. Vincent and the Commonwealth of Dominica.
So, before signing up with a forex broker, it’s important to keep your guard up and perform some serious homework.
Summary of Kaspitrade
We advise against working with Kaspitrade. It lists a residential location in the United Kingdom, claims to be regulated when it is not, and offers high leverage and wide spreads. There is overwhelming evidence to suggest that Kaspitrade is fraudulent.
Working with such a broker is not something I would suggest. The most effective defense against con artists is education about how they work. If you know anyone who could be interested in forex trading, please direct them to this review.
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