qTrade Exchange Review: A US regulated Altcoin exchange

About

Intro

In another edition of our exchange reviews, we decided to have a look at qtrade, a US regulated Altcoin exchange that lists innovative and emerging blockchains.

But, what is the deal with qtrade? What do they offer to users and is it a safe exchange to use? In this review, we will dig deep into this exchange and give you all the answers. We took an in-depth look at the exchange by examining the team, security, fees, platform functionality and asset coverage, among other metrics.

If you wish to skip to the summary to see the SWOT analysis, matrix score, and rating, click here.

Finally, if you find this review beneficial and wish to start trading on Qtrade, please feel free to sign up and register on their website. Proof of Review will receive a small referral credit, which will help us to continue providing reviews like these.

Thank you in advance for your support ❤️

Overview

According to their website “The qTrade platform provides split-second trade execution, industry-leading security practices, and robust, scalable architecture. Our mission is to help drive blockchain technology forward by reducing the barriers faced by innovative new and emerging technology.”

Use case

What is qTrade?

qTrade is an altcoin digital asset exchange, launched in April 2018 and based in the United States. The company is registered as qTrade LLC in Kansas.

History

How long has qTrade been operating?

The exchange was launched in April of 2018 and has been operating successfully for nearly two years. The team have done an outstanding job in this time in several ways, most notably with their stringent quality standards for listings, which has helped to build a strong core base of users.

We award a score of two marks here, as there are also no notable periods of downtime, no public hacks or negative sentiment towards the exchange through mismanagement. Full marks are awarded to exchanges operating for more than 3 years, so qTrade is well on the way to achieving this.

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Adoption

How many users are there?

Like most exchanges, there are no public user numbers listed on the website and we were unable to find any public information on user numbers from the project’s blog or social media.

Social Sentiment

A quick analysis on Twitter shows plenty of positive sentiment towards qTrade and its platform. Traders are quick to promote the unique listings on the platform such as NYZO, which is an excellent example of a coin adopted early on by qTrade.

What incentives are there to register?

At the time of writing, there are no sign-up bonuses for users.

Overall we score two marks for the adoption of the exchange among traders. qTrade has performed well in terms of drawing in traders onto its platform with its innovative coin listings.

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Company Information

Who is the company behind qTrade?

The company information is listed on the website, along with the registered trading address. A further search on the About page lists the company number and registration details. 

The exchange scores full marks on this section as we are highly impressed with the level of transparency shown around the company information and feel this should be the norm among all centralised cryptocurrency exchanges. 

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Coin Listings

What coins are listed on the platform?

As an altcoin exchange, qTrade noticeably fewer listings than many of it’s competitors and it is clear their ethos is quality listings over quantity. It’s trading pairs have a combination of BTC and PegNet (pCoin) markets, including NYZO/BTC, among others.

In total there are 33 pairs available for trading at the time of review.

How often are new coins listed?

One of the strongest areas of the exchange is the ability to list new, innovative coins on a regular basis, which makes it stand out head and shoulders above its competitors. Its most recent listing was on the Idena market (DNA/BTC) on the 3rd of February.

The coin listing process is one of the most transparent we have seen among the exchanges we have reviewed and is outlined in detail here. 

Does the exchange list any emerging or unique blockchains?

In this regard, qTrade is a beacon among altcoin exchanges, focusing on listing new and emerging blockchains for trading on their platform. This is reflected best in its trading pairs, with many of them either listed solely at qTrade, or qTrade being the first platform to list these coins.

In summary, we award full marks to qTrade for this section and feel they set the standard for other altcoin exchanges to aspire to, not only in terms of transparency, but also for the continued focus on only listing quality coins, as well.

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Competition

How does qTrade compare with its peers in the market?

📊 Uptime

qTrade has had no notable downtime issues in the time it has been operating and compares well to its peers in this regard.

💰 Bonuses

qTrade does not currently offer any signup bonuses for new customers, however, this is the norm among established or smaller altcoin exchanges.

💲 Fees

In this regard, qTrade does fall behind its direct competitors, with higher taker fees than either TradeOgre or Citex, at a rate of 0.5% compared to 0.2% or 0.1%, respectively. There is currently a 0% fee on maker fees, making it much more competitive on taker fees than any other altcoin exchange on the market. It is also incentivising for market makers to join and trade on the qTrade platform.

Overall, we award full marks for qTrade here, as it stands out head and shoulders above its competitors and has established its niche within the exchange sector. Its customers know to expect an all around quality experience and the exchange delivers this in abundance.

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Team

Experience

Who is the team behind qTrade?

As mentioned earlier, the company information is available on the website, however, no team information is visible. We were able to find a company LinkedIn profile for the team. There are 4 employees listed, but only one of the team members has their details available for public viewing.

A quick google search shows an interview indicating that the co-founders Eric and Isaac Cook are brothers and launched the exchange together. 

 

How can qTrade improve transparency?

qTrade is highly transparent around their company, but there are a few areas for improvement around the team information. A score of two is awarded, with points for the LinkedIn profile and public interview posted above.

To gain an extra point, we would highly recommend that, as the custodian of user funds, the team list their full info on the website for transparency. We also recommend that qTrade make more information about their team public on their LinkedIn profile so users can gauge the team’s skills, experience, and academic qualifications.

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What is the experience of the qTrade team?

The co-founder Eric, has a Bachelor’s degree in Business Information Systems from the University of Kansas, along with several years of experience working at the same institution post-graduation as an Online Course Developer.

Eric has been involved in the blockchain world since 2014, co-founding Simple Crypto Group, a custom mining pool, moving onto launch qTrade with his brother Isaac by 2018.

The information regarding the remaining team members is limited, meaning we are unable to pass any comment on their experience or skills. There is a short mention of the team skills on the website but we would like to see something more substantial.

Despite this, we award full marks for the experience of the co-founder. Eric has been in blockchain for several years, founded a startup prior to launching qTrade, and has a skill set related to his role in the company.

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Development

Development post-launch is often an indicator of the team’s focus and capabilities, and in this regard, we are impressed with how qTrade have progressed since launching.

What new developments are there?

There are regular developments and updates for the exchange since launch, with users updated via all social media channels about changes in the platform or updates. The team are quick to take on board feedback from its trading community and implement new features where necessary, as highlighted in their recent end of year update.

The bulk of the new developments since launch are focused around improving the trading experience, improving security, ensuring compliance/regulation of its users and improving the user experience by continuing to list innovative projects. To score full marks here, we would like to see the implementations of the features listed by qTrade on its most recent update.

Score

Advisors partnerships

Studying the documentation on the qTrade website, there is no evidence of advisors, partners, or crypto fund investors. While this may not be the case privately, there is nothing in the public domain for us to comment on.

In this case, we will award a score of one based on the fact that qTrade engage strongly with the innovative blockchains listed on their platform.

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Funding / Expenditure / Revenue

How was the exchange platform funded?

There is no public information around funding for the exchange prior to launch and there has been no token sale or public fundraising.

Are the financial records public?

qTrade does not produce any public financial records for its community and this is the norm among exchanges in this industry. The company is a privately funded entity and has the right to keep this information private.

We score two marks in this section due to the exchanges relatively low trading volumes and the revenues generated as fees for qTrade. To score full marks, we would like to see higher volumes on the platform over a continuous 30 day period.

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Features

API

There is a public API available, free to use and documented in English. To score full marks here we would like to see the API documented in at least one more language to make it more user-friendly.

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Order Types

What order types are there on qTrade?

The trading platform only allows basic order limit order types and is not the most user-friendly, in our opinion. Users who wish to market buy, have to buy in awkward pieces, often leading to a frustrating experience.

A quick read into their end of year update shows that the team are addressing this and plan to bring in more advanced order types sometime in Q1 of this year. They also mention that they have plans to improve the entry barrier for simple algorithmic trading and order execution strategies on their platform, so we are excited to see what the team come up with.

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Token Utility

There is currently no token associated with the qTrade platform, we so award a default score of one mark.

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Trading Pairs

What trading pairs are available?

Trading pairs on qTrade include two base pairings of BTC and the pUSD stablecoin, making up a combination of 33 trading pairs in total.

To score full marks on this section, we would like to see another altcoin base-pairing available such as Ethereum, a privacy coin such as Monero, or a unique blockchain listed on their exchange like Nyzo.

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Trading Fees

qTrade brings a unique feel to its fees structure and offers a competitive structure across its trading pairs, with a flat fee rate for Maker and Taker fees shown below.

What are the trading fees?

Standard taker fees are 0.5% and maker fees are a 0% rate. There is currently no tiered fee discounts for users based on their volume traded, but the team plan to introduce this within Q1 of this year.

How do these compare with its rivals?

qTrade taker fees are substantially higher than than the industry average fee of 0.2%, but the maker fees are the cheapest in the industry among altcoin exchanges. 

In this regard, there is room for improvement for qTrade to become more competitive. We recommend looking at incentive-based fee discounts for new users as one such improvement. Another improvement we can recommend is the sliding tier fee scale, which the team have stated will be introduced after Q1 of 2020. We will update the score here if any of these are implemented.

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Security

Overview

We take a look at the security metrics for qTrade. Although we aim to cover a range of metrics, no cryptocurrency exchange is 100% secure and users are encouraged to only store funds on exchanges when trading.

Is the website secure?

We run all the exchange websites through Mozilla’s Observatory-test. The score in this test is one of many indicators of the exchange’s security.

qTrade received an impressive score of B in this test. Upon reviewing their previous results, we can see they have improved from a previous C score, indicating a continuous focus on improving site and user security.

SSL

As with any exchange website, users should always verify the SSL certificate on the site before registering. We can see that qTrade has a full SSL certificate issued by Cloudflare.

Whitelisting

There is are several whitelisting processes available for users on qTrade, with the user’s email the main whitelisting option. This is required to approve login, withdrawals, and security-related updates until users active 2FA.

Once 2FA is activated, users are also able to whitelist withdrawal addresses to add an extra layer of security. We would recommend the ability to whitelist user IP addresses and devices to further secure user accounts.

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2FA

There is 2FA available on the exchange, however, is not mandatory for users to set this up to log in or trade on the platform. The 2FA options available are Authy and Google Authenticator, which provides a range of options at different levels of security and convenience, depending on the preference of the user.

We recommend that qTrade make 2FA registration mandatory when users first login to their account, and this should be standard across the industry.

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Safety

qTrade pride themselves as being a secure exchange with no history of theft, hacks, or data leaks. A quick google search confirms no recorded incidents of theft or hacks on the exchange. Their security practices are also outlined in detail on their website. A nice feature is that users are able to lock their account when a login notification email is sent, ensuring they can potentially lock out a hacker immediately without having to request qTrade support to action this request.

One of the most impressive elements highlighted is around the organisational and employee policies. It is safely assumed that a number of exchange hacks occur due to employee vulnerability or malfeasance. We award full marks for the safety-focused approach from the team.

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Audit

We cannot find any record of a public security audit of the qTrade exchange, which is not uncommon for exchanges. 

The team advised us that they have automated systems set up to handle parts of their security auditing system, and those run several times daily. They also undertake manual audits for subsystems when rolling out new features, ensuring they are compliant and functional.

One area we are impressed with is the bug bounty offered by the exchange, ensuring that community members are incentivised to report any flaws or security risks to the qTrade team. We would like to see this as mandatory across all exchanges in the industry.

We award full marks for this section, with our only area of recommendation being an increase of manual audits of user withdrawals before processing.

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Fund Custody

How are user funds stored on the exchange?

The website states qTrade build their own transactions to allow easy off-site signing, ensure idempotency, and leverage cold wallet storage for additional safety. 

Cold storage should be mandatory among exchanges. If your favourite exchange does not follow these practices, it is a recipe for disaster.

Are withdrawals audited?

The team state that nearly all withdrawals are automated, with fraud/risk analysis systems in place to flag any suspicious withdrawals for manual review.

Is there a security guide for users?

There is no section or guide on the website dedicated to security. We look at Binance as the benchmark for this with its security guides and recommend qTrade provide a similar guide to ensure their users remain safe.

Are there any user guides in case of exchange hack and/or procedures in place should this occur?

We also recommend that qTrade provide a user guide to highlight their plans in case users are unable to log in or the exchange is compromised.

We have never come across an exchange which tells its users what the procedures are in case of a hack. Aside from the theft of user funds, the risk of ID theft is a serious one and an area of concern for exchange users.

Do users maintain custody of their funds or private keys?

Since qTrade is a centralised exchange, users do not control their private keys and as such, all funds deposited on the exchange are in the custody of qTrade until withdrawn by the user. We always recommend users only keep funds on centralised exchanges when trading and withdraw funds as soon as practical for their own safety and security.

We score a mark of two points for the fund custody management of qTrade, with the bonus point reserved for exchanges that allow users to control their private keys.

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Legal

Overview

We take a look at the legal metrics for the exchange; however, we remind all users to undertake their due diligence before registering, depositing and trading at any exchange. Users have little or no legal recourse in the event funds are lost on exchanges through hacks or mismanagement.

KYC

Do I have to register for KYC?

KYC compliance is stated as mandatory for any user who wishes to deposit, trade or withdraw on the platform, with the guidelines, and limits shown below.

However, a quick delve into the KYC process on a user account highlights an area of concern we would like to address with the Level 1 KYC verification. Users are required to pass Level 1 to withdraw $2000 a day or $4000 if 2FA is activated. Users can enter any information during this process and it is seemingly unchecked by the qTrade team as we were able to pass this Level 1 check with a fake name and address.

We have several concerns here. Firstly, there is nothing stated clearly from qTrade that users have to enter their correct name and information during this Level 1 verification process, meaning traders can enter false information and are able to withdraw up to $4000 a day.

Our second concern relates to a similar practice that took place on the OKCoin exchange back in 2015, where users would use fake names to trade and withdraw on the platform, circumventing the KYC checks in place. After some time, OKCoin  requested users provide documentation to validate their registered name and address to allow withdrawals of their funds. In this case, many traders struggled to come up with excuses as to why their registered name didn’t match their official government ID and had issues withdrawing their funds.

We advise users on qTrade that this could happen on their platform at any time and they may have funds frozen as a result. We also strongly recommend qTrade clearly state to users that real information is required before they complete the form.

Is there any legal team or compliance policy?

Is qTrade a regulated exchange?

qTrade is a US-based exchange and state that are compliant with all US regulations, however, there is nothing to indicate that they are formally regulated.

Overall, we award a score of 1 for this metric based on the fact that there is a designated compliance officer on the team. We feel that the KYC process could be improved 

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Volumes

What are the daily volumes like on the exchange?

The trading volumes are relatively low on the exchange, considering market conditions, with an average of $13,029 in trading volume per day over the last thirty days. This would indicate trading volumes on the platform are real and not spoofed.

Are the trading volumes verified?

There is no information available to verify the trading volumes listed on qTrade. We encourage exchanges to register with metrics sites such as Nomics so trading volumes can be independently verified.

This is the one area that the exchange can improve significantly, and we can see from the December newsletter that the team are taking steps to improve this by offering more trading options and discounted fee options. As such, we are awarding a score of one in the volume metric based on the current volumes. 

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User Restrictions

Who can use qTrade?

Naturally, being a US-based exchange there are restrictions on users from within the United States, and the usual suspects such as Iran, North Korea, Syria and Cuba as per trading sanctions outlined here. One area of improvement for the exchange is to list these countries specifically in the terms of service.

How is this enforced?

Users have to pass KYC to deposit, trade and withdraw on the exchange, so restricted users are prevented from using the exchange at this hurdle as they fail to pass the eligibility criteria during the KYC check.

Overall, we award a score of two in this section, with qTrade missing out on full marks for not listing restricted users by country.

Restricted traders may be sending sensitive personal information for a KYC check when it’s not necessary if they are restricted. A more suitable option would be to list restricted countries, geofence restricted users by IP address, and then implement a KYC check.

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Accounting

Users are able to download trade history as a CSV file for all trade history for the duration of the account. We see this as beneficial for users are they are able to use this information for accounting and tax return purposes.

For full marks in this section, we would like to see USD values associated with each trade or tax accounting software integrated into the platform so users can determine the fiat value of each trade for tax return purposes.

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SAFU

Are my funds on the exchange insured?

As with many cryptocurrency exchanges, qTrade is not a formally regulated exchange and as such, it is unlikely that any users funds stored there are insured in any manner.

Does qTrade have a Secure Asset Fund for Users?

There is not currently a Secure Asset Fund for Users (SAFU) listed for qTrade. We recommend a SAFU to the qTrade team in case of exchange hacks/loss of customer funds, and they advised us it is something they will consider in the future.

For the SAFU metric, we are going to award a score of one based on the transparency of the qTrade company. We will revisit this in the future should a transparent SAFU fund be introduced

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Community

Overview

We take a look at the community engagement for the exchange, often one of the most overlooked criteria when deciding on whether to use an exchange or not. Customer support is essential to users, along with regular communication on developments and new listings.

Communication

There are various methods of communication for the exchange, with the team acknowledging the importance of communication and engagement with its community.

What are the most active channels?

The majority of communication occurs in the Discord channel, which is recommended as it allows 2-way communication. Discord offers an advantage over Telegram, as the server can have a range of channels for specific communication, including private or support channels.

The official twitter account could be more active, often only tweeting several times a month.

There is no official YouTube channel or official written/video user guides to educate users on how to use the platform. We highly recommend that qTrade make a series of official video user guides showing how to use the exchange. 

Overall we award a score of two marks for the communication metric.

Score ✅✅

Engagement

How well does qTrade engage with its community?

According to RivalIQ, the average Twitter engagement on the qTrade account is 65 per tweet, which is 0.17% of its total 52k follower audience.

At a rate of 65 engagement total per tweet, this is more than eight times the average engagement rate across all industries. The engagement rate per tweet is an impressive 2.59% or more than 54 times the industry average.

qTrade has excellent engagement despite their lack of regular tweets, and we score full marks for this section. The community vote for project listings also creates a great bond of engagement with communities. As such we award full marks for the engagement metric.

Score ✅✅✅

Website

The website is straightforward to navigate, with a crisp design keeping in line with their brand identity. It provides necessary information about qTrade, their products, policies, and the community listing vote. Areas for improvement include adding more information about the team for transparency. 

Is the website compliant?

The website is secured via HTTPS. However, it is not GDPR compliant for European users, and the domain details are not public.

Is the website multilingual?

The website and platform are multilingual in several languages, including English, Dutch, and Russian.

Score ✅✅✅

Support

What channels of user support are there?

There are several options for user support with a ticket option available for users, along with a dedicated support channel in the Discord server.

Is there multilingual support?

The team have advised that support is multilingual, including English, Dutch, and Russian.

We score full marks for the qTrade support metric, based on the live support channel in the Discord and the multilingual support options offered. One area of improvement we can recommend is a guide for users in the case of account compromise or hack.

Score ✅✅✅

Trading Experience

Overview

We take a look at the trading experience for the exchange, however, we remind all users to undertake their own due diligence before registering, depositing and trading at any exchange. Users have little or no legal recourse in event of funds lost on exchanges through mismanagement.

Creating a qTrade Account

Getting setup with a qTrade account is really easy and takes less than a few minutes. We remind users that qTrade require a KYC check before allowing users to withdraw on their platform. As noted earlier in the review, the Level 1 KYC check is very basic, no information entered by the user is verified, the check is passed instantly, and users are then able to withdraw up to $2000 a day.

qTrade Sign Up

To register for a qTrade account, head over to the registration page here. Users register their account via email and there is a nice feature allowing corporate/business accounts to register. When registering for an exchange, we always recommend using a dedicated email address and 2FA device, along with a unique password.

The final step of the signup process is to verify your email address and then login.

Summary

Conclusion

Overall the exchange has had an impressive start from its launch in 2018 and with a few improvements over time, it is possible to see the exchange improve score and rating to an A- grade or above.