In a week which will be mostly remembered for the British Pound Flash Crash, Forex Industry News at LeapRate seemed to center on one of the underlying themes driving the sector in recent months – over-reaction of regulators.
There certainly is need to regulate the online trading sector. However regulators demonstrated once again that when they take things too far, they end up hurting those very same retail traders whom they are (supposedly) trying to protect.
Case-in-point #1: our exclusive coverage of the Forex and Binary Options trading ban in Belgium, which has scared off all regulated, law-abiding credible brokers, and opened the door for unregulated operators.
Case-in-point #2: US regulators, which by raising the bar so high and making it so expensive to operate have forced out all but five Retail Forex brokers – thus reducing choice for US traders and also made it hard for add-on platform providers to make a go of it. The latest to leave the US is social trading platform provider ZuluTrade.
Some of our most popular, shared and commented-on posts this week at LeapRate included:
Belgium Forex and Binary Options ban backfiring as unregulated brokers filling the void. LeapRate Exclusive… LeapRate has learned that the Belgium government’s ban on leveraged Forex, CFD and Binary Options trading in order to ‘protect Belgian consumers of financial services’ has effectively backfired. At least so far. While virtually all larger, regulated brokers have indeed taken steps to close all accounts belonging to Belgian retail traders, the void is being filled by smaller, mainly unregulated brokers who sense opportunity.
LMAX sees Revenues decline 12% in 2015 leading to layoffs. LeapRate Exclusive… LeapRate has learned from regulatory filings that after seeing a year of tremendous growth in 2014, multilateral trading facility LMAX Exchange had a reversal of fortune in 2015, with Revenues declining by 12% on flat volumes. LMAX brought in Revenues of £23.0 million (about USD $30 million) in 2015, down 12% from £26.2 million in 2014. The company lost money in 2015. Due to the decline in activity, toward the end of the year LMAX decided to downsize the size of its development team. So what happened in 2015 at LMAX? And how are things going so far in 2016?
ZuluTrade exits US Retail Forex market withdrawing NFA membership, finalizes $30,000 settlement. LeapRate Exclusive… LeapRate has learned that social trading platform provider ZuluTrade has decided to withdraw its status as an NFA licensed introducing broker (IB), and exit the US retail forex market. ZuluTrade has been an NFA member since 2008. So why did ZuluTrade decide to terminate operations in the US? LeapRate spoke exclusively about the situation with ZuluTrade founder and CEO Leon Yohai. Read all about it and see what Leon had to say, exclusively at LeapRate.
Stater Global Markets launches as new Prime-of-Prime FX brokerage. LeapRate Exclusive Interview… LeapRate has learned that former Citi, IG and Integral executive Ramy Soliman has been appointed CEO of a new FCA regulated London based Prime of Prime Brokerage, called Stater Global Markets. Soliman was most recently VP EMEA Sales at Integral Development Corp. From 2010-2015 he was with Citi heading EMEA Margin FX Sales. He has also worked as a dealer and in Institutional Sales at IG Group. So how will Stater compete with the ‘big boys’ in FX Prime brokerage? What exactly is the difference between a Prime Broker, and Prime-of-Prime? We had the chance to speak with Ramy about getting Stater off the ground. Here’s what he had to say.