Read our Paperbids review to see if this broker is a scam or legit. Just to clear doubts, this is a paperbids.com review.
These days, people are looking for new ways of making money, particularly those that generate high returns. Hence, it is not surprising that the online trading trend has picked up, considering the opportunities it has to offer, especially where the crypto market is concerned.
This has undoubtedly pushed up the demand for online brokerages because they are the ones that give you access to the financial markets. But, it is vital to remember that not all companies out there are legitimate, with many scams operating in disguise. This Paperbids review can give insight into how these operate.
When people decide to dive into the financial markets, they are aware that scams exist and that they often advertise themselves as online brokerages. But, the problem is that most of them are not aware of how to identify them, which means their awareness does not really do them any good.
You have to understand their tricks to be able to stay safe, but this is not too complicated either. The important thing to keep in mind is that like legitimate companies, scam ones also try their best to showcase their offerings in the best light.
After all, their primary goal is to lure you to their platform and convince you to deposit their money. The only way they can accomplish this goal is by making big promises and tall claims. But, unlike genuine firms, they are obviously not honest. It is just a ruse to fool people, so you have to be able to see through their claims.
How can you do that? You do not need to be an expert for this purpose because all you are required to do is see if it can live up to its claims. Once you begin doing that, things will clear up very quickly.
If it is a scam, the house of cards will come crashing down and if it is not, you will be able to choose the right brokerage. When you first come across Paperbids, you will notice that it presents itself as one of the biggest CFD providers, a competitive forex brokerage and a safe platform for your funds.
The fact that it offers access to lots of trading instruments including forex, commodities, crypto, indices and metals make it more attractive. But, is it scam or legitimate? Only a closer look will tell:
Licensing and regulation
It is best to start with the licensing and regulation of an online broker when you want to determine whether it belongs to the scam category, or if it is legitimate.
The former is unlikely to have any kind of license because that would just reveal the truth about it, while the latter will never operate without one because it wants to establish its credibility and develop a positive reputation. To identify which camp Paperbids belongs to, you have to check where it is based.
A look at the Paperbids website shows that it has offices in multiple locations, including Hong Kong, the United Kingdom as well as Luxembourg. All of these are strictly regulated jurisdictions and brokerages cannot operate there without a license.
Does it mean that Paperbids has the license needed for operating in these countries? Unfortunately, it is highly unlikely because the company is offering services that are against the regulatory framework of these countries.
For instance, the leverage ratios that Paperbids offers are significantly higher than what are permitted in both the UK and Luxembourg, which is part of the European Union. You can also check the online registers of the regulatory authorities of the three jurisdictions and not find the brokerage listed. This shows that it cannot be considered a legitimate company by any definition.
Terms and Conditions
When you have already established that you are dealing with an unlicensed brokerage in the form of Paperbids, it is now risky for you to sign up with a company like that.
Therefore, it is best to be cautious and go over its Terms and Conditions to see exactly what it has to offer. These are meant to highlight the policies the brokerage will expect you to comply with, along with its charges, fees and other details.
Essentially, their purpose is to establish what kind of relationship traders will have with the brokerage. But, you will be shocked to find that Paperbids fails to provide its Terms and Conditions, which means there is no transparency. There is absolutely no legal documentation available on their website and it should worry you because a legitimate company will never make such a mistake.
The next step is to check the trading platform that a brokerage is offering and Paperbids is ready to disappoint you yet again because the software they offer is nothing to take note of. In fact, you will find that a lot of scam companies have offered this platform before, which does not add credibility to the brokerage.
Rather than the professional MT4, or MT5 trading platforms, you will find a basic and lackluster web trading platform at Paperbids that does not offer you more than a couple of features. These do not really offer you any such value.
You will find that the leverage offered at Paperbids can go as high as 1:200 and some traders may find this very appealing. But, you have to remember that leverage can also increase your losses and not just profits, so it is very dangerous.
But, the problem here is that Paperbids claims to be based in Luxembourg and the UK, yet it is offering leverage much higher than 1:30, which is the limit imposed for these regions.
Another sign that you are dealing with a scam brokerage is the fact that Paperbids only supports one payment method; BTC deposits. Crypto payments come with no refunds and they are also anonymous, which is precisely what scammers prefer because it lets them keep your money.
All of these issues that you discover about Paperbids make it clear that even though it claims to be a legitimate broker, it is just a scam.