Poloniex (Founded in 2013) is a US cryptocurrency exchange that offers over 100 bitcoin (BTC) markets available for trading. It provides its customers with a secure trading environment as well as advanced charts and data analysis tools. The platform enables its users to buy and sell cryptocurrencies such as LTC, namecoin, Dogecoin, and more.^[7]

History

In March 2014, Poloniex has suffered a hacker attack, making it lose 12.3% of all Bitcoin it held. On the 4th of March, when it happened, the attack was stopped and the service halts its work for a day. On the 5th the market was unfrozen and CEO D’Agosta made a decision – all balances were evened out to lose this 12.3%.^[9] The service fully accepted its responsibility and plans on paying out everything that was lost. Partly from their own pocket and partly by raising fees from 0.2% to 1.5%.^[8]
In September 2016, due to regulatory changes, Poloniex has announced an end to service in New Hampshire and it will be suspending all accounts from opening new margin positions. July 2017, Poloniex announced that they would stop their operations in the state of Washington following the enactment of Senate Bill 5031 or the Uniform Money Services Act.
In May 2017, law firm Berns Weiss LLP announces that is investigating potential claims on behalf of cryptocurrency exchange users who may have incurred losses due to recent DDoS attacks. Poloniex experienced severe distributed denial of service (DDoS) attacks on May 8 that led to many leveraged positions being liquidated. Berns Weiss LLP claim that a large Ethereum sell order was executed within minutes of a DDoS attack on Poloniex. That was a sell order of enough volume to push down the Ethereum price and therefore liquidate positions that had been placed on margin calls. Many users of the exchanges are under the impression that they are victims of market manipulation and possibly even insider trading.
In October 2017, Security researchers have discovered two fraudulent apps on the Google Play store purportedly tied to the Poloniex cryptocurrency exchange. Apart from harvesting Poloniex login credentials, the fake apps also try to trick victims into making their Gmail accounts accessible to the attackers.^[10]
In December 2017, Poloniex announced that all traders who use the platform must verify their identity. A while back, Poloniex started to implement an identity verification process for all its new registrants. At the time legacy account holders were provided with the privilege of not being required to submit identity credentials. Now Poloniex has issued a notice to all of its users that legacy accounts will now be required to verify their identities or the unverified accounts will be closed. The exact date for this deadline will be announced in Q1 2018.^[1]
On February 2, 2018, technology blog Modern Consensus reported that Circle, a multi-currency money-sending app, is in the works to acquire Poloniex. Modern Consensus cited two unnamed sources that had information about the potential deal. Both Circle and Poloniex denied such deal.^[2]
On February 26, 2018, cryptocurrency startup Circle has acquired digital token exchange Poloniex. Neither of the companies disclosed the value of the deal that gives Circle control of a marketplace it said sometimes has daily volumes of more than $2 billion. Fortune magazine said the deal was worth $400 million, citing a person familiar with the matter.
In early 2020, Poloniex joined major exchange Binance in seeking to undo a soft fork of Steemit. The soft fork was done to limit the influence that TRON (TRON) had over the cryptocurrency. In June 2020, Poloniex was added as a defendant in a case against Bitfinex and Tether. The lawsuit claims Poloniex and other exchanges transferred among themselves Tether not fully backed by dollar deposits. ^[3]

Features

Poloniex allows its customers to transact with fiat currencies across the exchange and blockchain without the volatility concerns related to Bitcoin or altcoins. Poloniex stores the majority of customer deposits in offline air-gapped cold storage. They only keep enough to facilitate active trading, minimizing risk and exposure. The funds are not used in any Fractional reserve lending. The exchange has hundreds of millions of USD in volume daily.^[4]
The company also offers margin trading, allowing users to borrow money to invest in Ethereum or Bitcoin for an Interest rate. Additionally, there is a 0.05% - 0.40% fee on trading depending on the number of bitcoins traded over a 30 day trailing average. The lowest bracket is under 600 bitcoins and the highest is 120,000 bitcoins or more. ^[5]
Currently, Poloniex supports Litecoin, Dash, Zcash, Bytecoin, Steem, OmiseGO, Ethereum Classic, Lisk, Gnosis, Stratis, Monero, NEM, Ripple, Factom, Vcash, Stellar Lumens, Vertcoin, Bitshares and many others.^[6]

Poloniex & Binance

Poloniex has launched support for Binance Coin and Binance USD, despite CZ’s recent vocal criticism of Justin Sun over his handling of Steem.cPoloniex, a veteran exchange that was recently purchased by a consortium including Tron founder Justin Sun, has launched Binance Coin (BNB) and Binance USD (BUSD) pairings. As of June 6, BNB and BUSD wallets are now live on the exchange, with markets for the corresponding pairings slated to launch in post-only mode to ensure stability before full trading functionality rolls out.

• Binance tokens listed on Poloniex

The listings bring support for six new pairings, with Binance Coin now tradeable against Bitcoin (BTC), Tether (USDT), and Tron (TRX) in addition to BUSD, and Binance USD also supported against USDT and BTC. BNB currently comprises the eighth-ranked cryptocurrency by capitalization with $2.76 billion. While BUSD ranks as the 49th-largest crypto asset by market cap, it is the third-ranked stablecoin behind Tether and USD Coin.

Controversies

Poloniex, Bittrex and Roche Freedman LLP

Bittrex and Poloniex want the law firm Roche Freedman LLP removed from a specific class-action lawsuit filed against them.

The crypto firm filed the class-action suit against several trading platforms in 2020 and the lawsuit claims a number of centralized exchanges used tether (USDT) to manipulate crypto prices.

However, Kyle Roche, an attorney, and founding partner at Roche Freedman, has removed himself from the lawsuits, after a series of videos was published by Crypto Leaks.

In the video clips, Roche discusses his relationship with different crypto businesses.
The attorney claims the clips contain “numerous unsourced false statements and illegally obtained, highly edited video clips that are not presented with accurate context.” Despite Roche’s defense, he decided to withdraw from several high-profile cryptocurrency lawsuits.

Future Plans

Justin Sun’s Tron, a blockchain-based decentralized platform, is an investor in Poloniex. Tron was part of the group that invested $100 million in the exchange ahead of its 2019 spin-out from Circle. With Tron’s help, Poloniex is focused heavily on the decentralized finance space. Poloniex has launched an initial exchange offering (IEO) platform to help blockchain projects grow. The IEO platform, called LaunchBase, is in partnership with Tron. LaunchBase will help promote user adoption by offering tokens and professional advice.
Poloniex was, at one point, a major exchange that facilitated a large part of crypto payments. However, at the time of its spin-out from Circle, the exchange’s total market value had fallen drastically. As of March 1, 2021, Poloniex was the 13th ranked cryptocurrency exchange by dollar-value volume, with $236 million in the previous 24-hour period. Meanwhile, Binance was number one with nearly $25 billion traded.