The Ultimate OKEx Exchange Review (2019): Safe or Scam?

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OKEx exchange is one of the top-ten global cryptocurrency exchanges by daily volume and provides services in over 100 countries. This popular Exchange conveniently offers fiat-to-fiat and crypto-to-fiat trading, futures trading and wallet options all on one site. In this review, we look at the Exchange’s features and some controversies that you need to know.

History of OKEx

OKEx was founded in 2017 by Star Xu. Originally based in China, the Exchange relocated to Malta in 2018 which has a better regulatory framework for blockchain related activities. OKEx is part of OK Group, which is a blockchain technology company founded in 2013. As at 2018, the Exchange has over 800 employees and serves customers in over 100 countries.

Key Features and Functions

Here are some of OKEx’s key features and functions on offer:

  • Crypto-to-crypto and crypto-to-fiat trading pairs
  • Customer to customer (C2C) trading platform
  • Spot and Margin trading
  • Futures contracts
  • Perpetual swaps
  • Integrated storage wallet

Let’s take a look at each of these features in detail.

There are only a handful of exchanges out there that offers crypto-to-fiat trading pairs. With OKEx, customers can use USD or CNY to purchase cryptocurrencies.

OKEx’s C2C trading platform was launched in 2017. The C2C platform allows users to trade a selection of cryptocurrencies amongst themselves, similar to an Over the Counter (OTC) trading desk. Payment can be made using fiat currency.

Spot and Margin trading respectively allows users to trade cryptocurrencies immediately using the funds they have on hand, or to use borrowed funds to increase their profits.

Futures contracts allows trading of the cryptocurrency at a predetermined future date and price, irrespective of the market conditions at the time the contract expires. OKEx has a peer to peer leveraged trading platform, and does not require traders to top up additional margin. According to OKEx, a trader’s losses are limited to the margin they paid for entering into the futures contract. Learn more about futures trading at OKEx here.

Perpetual swap trading allows traders to buy and sell contracts of $100 USD worth of Bitcoin. These are futures contracts which do not have an expiry date and are essentially bets on the future value of a cryptocurrency. Learn more about OKEx perpetual swap and its fees here.

One unique feature of OKEx is its integrated storage wallet called OKEx Wallet. Similar to many other exchanges, OKEx has a mobile app available on the App Store and Google Play Store for convenient trading on the go. However with the OKEx app, the OKEx Wallet serves as a software wallet where you can store multiple cryptocurrencies separately from your trading account.

OKEx mobile app
OKEx mobile app

Supported Countries

OKEx is available in more than 100 countries. However its unavailability in the US is a huge downside when it has a huge base of cryptocurrency users. These are some other countries where the Exchange is unavailable:

American SamoaBangladeshBolivia
CrimeaCubaEcuador
GuamHong KongIran
KyrgyzstanPuerto RicoSudan
SyriaUS Virgin Islands

Supported Cryptocurrencies and Payment Methods

OKEx supports a wide array of cryptocurrency options for traders and investors to transact. The list numbers in the hundred and include:

Bitcoin (BTC)Bitcoin Cash (BCH)Ethereum (ETH)Ethereum Classic (ETC)Tether (USDT)
Litecoin (LTC) EOS (EOS)Qtum (QTUM)NEO (NEO)Ontology (ONT)
Mithril (MITH)Nano (NANO)FirstBlood (1ST)Ark (ARK)Bitcoin Diamond (BCD)
Bitcoin Gold (BTG)Zilliqa (ZIL)DigiByte (DGB)Stellar (XLM)Monero (XMR)

Traders also have a wide variety of payment methods for purchasing cryptocurrencies. These include:

  • Bank transfer for fiat to the cryptocurrency exchange.
  • Credit and debit card payments from select jurisdictions.
  • Cryptocurrency transfer from an off-exchange wallet or from a separate exchange to the OKEx exchange.
  • WeChat network payments.
  • Alipay system.

Deposit and Withdrawal Fees

The Exchange doesn’t charge withdrawal or deposit fees. In addition to that, miners get exemptions for transfers between OKCoin and OKEx. It is also worth mentioning that the Exchange has transfer limits which depend on your daily volume.

Trading Fees

OKEx adopts a maker-taker fee schedule to encourage more placements of orders and liquidity. Accordingly, the maker fee is lower than the taker fee. The maker and trader fees start from 0.15 percent and 0.2 percent respectively.

Notably, there are trading tiers that depend on user trading volume. As such, the higher your tier, the lower your trading fee. Moreover, traders who provide consistent liquidity get discounts through OKEx’s Market Maker program.

Fee schedule for traders under their Market Maker program

Controversies

The Exchange faced several challenges in 2018. In August, after a large wrong way bet by one of its users, the Exchange transferred the losses onto its other traders. Later on in November, the Exchange suddenly change the terms of its Bitcoin Cash contract, forcing an early settlement and leaving traders suffering from losses. The Exchange’s explanation was that it was to protect traders from any volatility which may arise out of the Bitcoin Cash split. Yet some traders lost over USD $700,000, and many were prompted to file complaints with the Hong Kong’s Securities and Futures Commission.

Further, there was a massive scare in September 2019 when Twitter user Whale Alert found that more than USD $270 million was sent from the Exchange to an unknown account. This prompted OKEx’s head of PR, Jennifer Chow to go on Twitter to confirm that it was only a regularly scheduled wallet maintenance.

Tweet from OKEx clarifying the situation

Is OKEx Safe in 2019?

OKEx uses distributed storage to safeguard against losses in the event of hacking. This is because the exchange has various cold storage locations across the world to limit asset exposure. Additionally, the network has offline private keys for exchange hot wallets. Therefore, only a minimal amount of assets is held in the exchange hot wallet to boost security.

OKEx also has a robust system to ensure customer account security. These tools include 2FA verification, mobile verification codes for withdrawals and changing settings and anti-phishing codes in every OKEx email.They also have a bug bounty program to reward any persons who discover and report security vulnerabilities in the Exchange.

The Exchange did suffer a hack in August 2017 where one user’s account was compromised and lost 200 Bitcoin (then worth around USD $750,000) as a result. In that case, OKEx blamed the situation on hackers, rather than any issues with the Exchange itself. It is also still unclear whether the Exchange was really hacked in September 2019. Though there are no reports of any users coming forward to say they have suffered losses. So far, unlike some other cryptocurrency exchanges, OKEx has not suffered a confirmed hack involving multiple victims.

Based on their track record, OKEx seems to be a safe Exchange to use. However there is no evidence that they have an insurance fund to cover any potential losses from hacks, which could be a turn-off for some users. Notwithstanding this, they do have the usual security measures in place that you expect from a reputable exchange. However, it is still advisable to only store assets you will trade imminently in an exchange wallet and store the remainder of your funds in an offline hardware wallet.

Which hardware wallet should you get? We’ve compared the top 3 hardware wallets on the market. Or check out our individual detailed reviews for the Ledger Nano XTrezor Model T and KeepKey.

And check out my video comparing the Ledger Nano S (the predecessor to the Nano X), Trezor Model T and KeepKey below:

Trezor Model T Guide & Review: Comparison with Ledger Nano S and KeepKey

Conclusion: OKEx Pros and Cons

Pros

  • Good track record with no significant hacks so far.
  • Much lower trading fees for their Market Maker program, which only requires KYC level 2 and 20 Bitcoin in the trading account as a prerequisite.
  • In built software wallet in its app means convenient on the go trading and using cryptocurrency.
  • Wide range of functions for traders to choose from.

Cons

  • Not available in the US, and unlike some other exchanges does not have a US version of the exchange to fill the gap.
  • When researching for this article I found a lot of information could only be found on scattered Medium articles published by OKEx or on third party websites. This can give the impression of a lack of transparency. It is not a significant issue but it’s something the Exchange can look towards improving.
  • Unknown whether they have an insurance fund to cover users’ losses in the event of a hack.

Final Score

Services offered: 4/5
Cryptocurrency support: 4/5
Fees: 4/5
Security: 4/5
Final Score: 4/5

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