One of the increasingly common tactics used by unregulated or dishonest brokers is to restrict withdrawals exclusively to cryptocurrency. While crypto can be a legitimate and fast withdrawal method, forcing traders to use it—especially if they deposited via traditional fiat channels—is a major red flag. This withdrawal-only-in-crypto scam often leads to delayed access, poor exchange rates, added fees, or complete loss of funds, with the broker hiding behind the decentralised nature of blockchain to avoid accountability.

This isn’t about flexibility—it’s about control, obfuscation, and risk transfer.

How the Scam Works

1. Deposit Is Made Using Traditional Methods

Most traders begin by depositing through:

• Credit or debit card
• Wire transfer
• Online wallets (Skrill, Neteller, etc.)

At this point, the broker appears legitimate and offers multiple withdrawal options on the dashboard.

2. Withdrawal Request Triggers Policy Shift

When the trader tries to withdraw profits or remaining funds, they’re informed:

“Due to updated policies, all withdrawals must now be processed via cryptocurrency.”

This change is not documented in the original account terms and is often justified with vague reasons like:

• “Faster processing”
• “Anti-fraud compliance”
• “Banking delays”
• “Third-party restrictions”

3. Trader Is Forced to Provide a Crypto Wallet

Even if they’ve never used crypto before, the broker insists the only way to receive funds is to:

• Open a personal crypto wallet
• Share the address (often with screenshots)
• Accept tokens like USDT, BTC, or ETH—regardless of initial deposit method

4. Poor Rates or Extra Fees Are Applied

The broker processes the withdrawal in crypto but applies:

• Unfavourable exchange rates
• Hidden transfer fees
• Conversion delays that fluctuate based on market timing

Often, the amount received is significantly less than expected, or the transaction is never confirmed on the blockchain.

5. Support Blames Blockchain or Third Parties

When the trader questions the shortfall or delay, support says:

“It’s a network issue.”
“We sent it—please wait for blockchain confirmation.”
“Check with your wallet provider.”

The burden of resolution is shifted to the trader—despite the broker having full control.

Real Case: $1,200 Withdrawal in BTC Never Arrives

A trader earns profits on a $500 deposit via card. When withdrawing, they’re told only USDT is allowed. They create a wallet and submit the request. Three days later, they’re sent a blockchain hash that doesn’t match any real transaction, and support stops responding. The broker claims:

“We fulfilled our obligation. Contact your wallet provider.”

The funds are lost, and the trader has no chargeback rights through the card issuer, as the transaction was converted to crypto.

Why This Scam Is So Dangerous

The withdrawal-only-in-crypto trap is particularly dangerous because:

• It removes the trader’s access to legal and financial protections (e.g. chargebacks, transaction disputes)
• It opens the door to irreversible losses
• It disguises fraud behind crypto’s decentralised nature
• It shifts the operational burden and risk onto the trader
• It makes tracking and recovering stolen funds nearly impossible

This scam is designed to delay, reduce, or deny withdrawals while appearing “compliant.”

How to Detect the Trap Early

1. Review Withdrawal Terms Before Depositing

Scan for clauses like:

• “Broker reserves the right to change withdrawal methods”
• “All withdrawals may be processed in cryptocurrency”
• “Due to third-party restrictions, only crypto may be available at times”

Such wording gives the broker freedom to manipulate payout methods later.

2. Ask About Withdrawal Channels in Writing

Before depositing, ask:

• “Can I withdraw via the same method I used to deposit?”
• “Is crypto the only withdrawal option?”
• “Are there any conditions under which fiat withdrawals are disabled?”

Document all responses.

3. Be Wary of ‘Crypto-Only’ Dashboards

If the account interface only shows cryptocurrency wallets—even though you deposited via card—it’s a warning sign of intent to trap.

4. Check for Withdrawal Delays and Conversion Fees

If you’re asked to “accept crypto instead” due to delays, know that it’s likely a stalling tactic—not a convenience.

How to Protect Yourself

1. Use Regulated Brokers with Clear Withdrawal Policies

Trusted brokers under FCA, ASIC, or CySEC regulation:

• Must allow withdrawals via the original payment method
• Must disclose withdrawal terms clearly
• Cannot unilaterally force crypto-only withdrawals after the fact

2. Avoid Brokers That Force Wallet Creation

If a broker pressures you to create a crypto wallet solely for withdrawal, pause immediately. Legit brokers let you choose how to receive funds.

3. Test with a Small Withdrawal First

Before making large deposits or requesting big withdrawals, test the system with a small amount to evaluate speed, transparency, and method.

4. Report the Broker If Funds Are Lost or Trapped

If you’ve been forced into a crypto withdrawal and lost funds:

• File a complaint with their regulator (if any)
• Report the wallet address as suspicious to blockchain analytics firms
• Warn others via forums and watchdog sites

Regulatory Viewpoint

Top-tier regulators mandate that:

• Withdrawal methods must be consistent with deposit channels
• Unilateral changes to withdrawal policy are prohibited without consent
• Clients must not be forced into irreversible payment methods post-deposit

If your broker is regulated and forces crypto-only withdrawals, they may be in violation of withdrawal protection standards.

Conclusion: Crypto Should Be an Option—Not an Obligation

The withdrawal-only-in-cryptocurrency scam is a modern twist on an old trick: delay or deflect payment long enough to frustrate the trader into giving up. While crypto can be fast and convenient, forcing it on traders without consent—especially after fiat deposits—is a clear sign of malicious intent.

To trade with confidence, avoid payout manipulation, and choose brokers who respect your rights, enrol in our Trading Courses, built to help retail traders make smart, secure decisions—across every channel.