This Step-by-Step Guide to Poloniex reviews how to trade cryptocurrency on Poloniex. Learn how to create an account, deposit funds, navigate the trading interface, buy and sell cryptocurrency, and withdraw funds on Poloniex. Circle (backed by Goldman Sachs) acquired Poloniex in early 2018. Since then, Poloniex has upgraded its trading experience and focused on security, compliance with U.S. laws and regulations, and listing higher-quality crypto-assets. While Poloniex’s changes are a work in progress, it is transforming into a serious competitor for crypto-to-crypto centralized exchanges such as Binance, Bittrex, Bibox, and KuCoin. Let’s get started!
The first step is to visit Poloniex’s website to create an account and verify your identity. Poloniex requires a full name, email, address, social security number, phone number, government ID, and photograph of yourself. This is similar to other U.S.-based cryptocurrency exchanges such as Coinbase, Coinbase Pro, Gemini, and Bittrex that work to comply with U.S. laws. We encountered an unexplained problem with the photograph ID we submitted, but Poloniex support resolved the issue in a few days.
The best practice is to always use two-factor authentication on a cryptocurrency exchange. With two factor authentication, you will a receive temporary code for Poloniex on the Google Authenticator app on your mobile phone that you enter to log in and confirm transactions. Two factor authentication is a vital security setting that helps prevent unauthorized access to your Poloniex account if your username and password are hacked. Go to the setting for two factor authentication and follow the directions to enable it. Make sure you backup your secret key to a safe location. The secret key is necessary to restore your two-factor authentication code if you replace your mobile phone.
Let’s next review how to deposit cryptocurrency into your Poloniex account. To visit the deposits page, select the Deposits & Withdrawals button from the menu in the upper right.
Next find the cryptocurrency you want to deposit and select the deposit button. Poloniex will display a deposit address and make a QR code available. Copy that address and paste it into the exchange, wallet, or other service that will send cryptocurrency to your Poloniex account. Note that Poloniex has minimum deposits on a few cryptocurrencies, including an unusually high 0.5 ETH minimum deposit. We were disappointed in the high ETH minimum deposit and would urge Poloniex to lower it.
It may take some time for a deposit to confirm depending on the cryptocurrency. Visit the History page to view your pending and complete deposits. Here, Poloniex showed that we deposited 0.00767475 BTC.
Let’s next review the trading screen on Poloniex. It includes a market pair list, trading chart, order entry boxes, order book, depth chart, and trade history.
Poloniex offers markets paired to BTC, ETH, XMR, and USDT. Note that USDT is not the U.S. Dollar, but a cryptocurrency-version of the U.S. dollar called Tether that is allegedly backed 1-to-1 by U.S. dollar reserves. We also anticipate that Poloniex will also add markets paired to USDC in the future because Poloniex’s owner, Circle, launched USDC as a cryptocurrency version of the U.S. dollar backed 1-to-1 by U.S. dollar reserves.
Poloniex’s trading chart is one of the best in the industry. It includes technical indicators in the upper left, several pre-set ways to zoom and view the chart at the bottom, and an easy slider to manipulate the amount of time displayed.
Poloniex has order boxes to enter standard buy and sell orders. A buy order places an order to buy at the price entered for the amount entered onto the order book. If there is a matching sell order, the buy order automatically fills. That is a “taker” order and has a 0.20% fee. If there is no matching sell order, the buy order is listed on the order book until filled by a seller’s order in the future. That is a “maker” order and has a lower 0.10% fee. Seller orders work the same way.
Poloniex also offers a stop limit order. According to Poloniex, “a stop-limit order is an order to place a regular buy or sell order (also known as a ‘limit order’) when the highest bid or lowest ask reaches a specified price, known as the ‘stop.’ This can be helpful for protecting profits or minimizing losses.The stop-limit box has three inputs:
- Stop – think of this as the ‘trigger price.’ If you place a stop-limit order to sell, it will turn into a regular limit order when the highest bid drops to or below the stop. If you place a stop-limit order to buy, it will turn into a regular limit order when the lowest ask raises to or exceeds the stop.
- Limit – this is the same thing as the ‘Price’ on a regular buy or sell order. Once your stop-limit order has been triggered by the highest bid or lowest ask reaching your stop price, it turns into a buy or sell order for the price you enter in the limit field.
- Amount – this is the same as the ‘Amount’ on a regular buy or sell order. It indicates the amount of coins you wish to buy or sell should your stop-limit order be triggered.”
The order book shows all unmatched buy and sell orders. Users can click on any order in the order book to autofill the buy or sell order boxes for filling that particular order.
Poloniex’s market depth chart helps show potential buy and sell walls on the order book. It’s a helpful visualization as users decide what price to set for their orders.
The trade history section shows the trade history for the market and individual user, plus the open orders for the individual user.
Let’s now show how to place a buy order. Recall that earlier in this guide we deposited 0.00767475 BTC into our Poloniex account for trading. The remainder of this guide will show how to buy ZRX, the token for the 0x Protocol, with BTC. Start by selecting the BTC/ZRX market pair from the market pairs menu.
Next we need to enter our buy order for ZRX. We could have selected an existing sell order on the order book or selected the link to “lowest ask” if we wanted to immediately fill our order. But that has a higher 0.20% trading fee. Instead, we entered a buy order at a slightly lower price than the existing sell orders. This ensures our buy order will sit on the order book as a limit order until filled and have the lower 0.10% fee. We entered an order to buy about 79.498 ZRX for 0.00009654 BTC per ZRX.
The buy limit order for 79.498 ZRX at a price of 0.00009654 BTC/ZRX is immediately reflected on the order book. This buy limit order will sit on the order book until a seller order matches it.
Our buy limit order filled a few minutes later. The trade history immediately reflected our filled order under the “my trades” section in trade history.
Let’s finish by reviewing how to withdraw cryptocurrency from Poloniex. Start by visiting the Deposits & Withdrawals menu from the upper right menu.
Next find the cryptocurrency to withdraw and select the “withdraw” link. Then enter the withdrawal address and amount to withdraw. Note that Poloniex will charge a withdrawal fee, which was 5 ZRX for our withdrawal 79.418 ZRX. Finally, select the “withdraw” button to continue. Poloniex will send an email to the email address on file to confirm the withdrawal.
Click the link in the email Poloniex sent to confirm the withdrawal. Then review the withdrawal details and select “yes, send funds” to confirm the withdrawal.
We have now covered how to sign up for Poloniex, deposit cryptocurrency, navigate the trading the trading interface, buy cryptocurrency, and withdraw cryptocurrency. You are ready to get started on Poloniex!