Very interesting indeed. I remember them well. It was also a harbinger of things to come.
Regardless if a company has no footprint in the USA, the regulators here granted themselves the authority to force compliance, and nobody challenged them.
That’s when I knew the writing was on the wall regarding crypto space in the USA.
@SmallPaul, there are options out there- I wasn’t able to get an account with HF/Hotforex because they ask for your country of birth but I have successfully opened accounts with other U.S. forbidden brokers by submitting my utility bill and driver license to prove residency/KYC, etc.
So far, the effort has paid off and I have improved trading conditions and more instruments available. My recent favorite is BUND with a one tick spread. Scalping heaven. Not all of them accept crypto for deposit/withdrawal but I have a bank account in my new home country they can wire to. It can be done.
I use a VPS, so when I visit the U.S. I don’t have to bother with a VPN to trade. The VPN is only needed to login to the broker back office if I need to setup a withdrawal.
As long as you file the proper FATCA paperwork, everything is 100% legal and above board. The government doesn’t forbid us from trading with any brokers, they forbid a competitive broker market to exist in the U.S.
Can you elaborate? What do you think is going to happen?
It sounds to me like they only nailed him because they seized the domain name. They must have made a mistake in having their hosting with some connection to the U.S.?
If they hadn’t been able to seize the domain, the Austrian kid could have given the CFTC the finger and kept going.
What’s to stop the CFTC from doing the same exact thing to any other broker?
Why couldn’t they agree to dump the American clientele and move on? Why did they have to destroy an honest, innovative business?
There must be more to this story.
It’s not what is “going to happen,” rather what has been happening ever since. Death by a thousand cuts.
Ever since this event happen with 1broker the US regulators have been choking off how and what US citizens can participate in crypto. Numerous exchanges were quick to halt US clients and or offer a watered-down US versions with extremely limited options. Every transaction, regardless of size will be reported to regulators.
The owner made the mistake of registering the parent companies LLC in the Marshall Islands. It was widely reported at the time that it was flimsy and would most likely have been overturned if challenged.
For those that were around before, during and after, know very well what happened. Its an old story.
Here’s another broker that kicked me to the curb. Why weren’t they seized and shut down? Must have good connections? It’s exhausting having to worry about the next senseless problem created by some bureaucrat that has never traded one lot in their life.
However, the example below is the exception and not the rule. I have several accounts with other brokers that don’t have any U.S. entanglement.
It’s ironic that the only brokers that took my money in thirteen years of trading were U.S. based and regulated.
Google:
MF Global
PFG Best
And some FX shop from Naples, FL than I can’t recall the name of. I think it was around 2012 that they just disappeared with everyone’s cash.
I haven’t lost any money from offshore brokers. I’ve had delays but none of them has stolen my money.
What is the Turnkeyfx/Coinexx withdrawal time? Is it fast like prosperityfx or cedarfx ? Thx.
On average 24-48 hours. I had one that was almost a week recently from Turnkey but maybe that’s because they were being absorbed by Coinexx. Pure speculation on my part.
No, don’t think they will every get that fast
I can only speculate that Patrick Brunner was an easy target. He was not hiding his identity and lived in Austria. There are other online brokers dealing in Bitcoin that allow CFD trading of US stocks and continue to operate.
My guess is that the regulators wanted to send a message by taking down 1broker.
Unfortunately, I think this kind of action is counterproductive.
My view is that it is better to encourage well run businesses in the Crypto sphere and collect some revenue from them in the process. Are we free market capitalists or mercantilists?
Many questions.
How is it the FBI’s job to police an Austrian broker?
Why so anti-CFDs? If “certain high net worth individuals” can trade CFDs, why not the rest of us? I think George Soros could cause more damage to any US stock by shorting it than all of us “low net worth individuals” combined.
And the often raised question of what is wrong with leverage? If you are smart about it, leverage just means you have LESS capital at risk, because you have less capital deposited at the broker.
The USA is supposed to be the shining city on the hill where innovation and entrepreneurship happen. We should aspire to this ideal.
The draconian measures we rail against in this forum not only hurt traders, but are unbefitting our tradition as a leader in innovation. Time to change the legislation and encoirage the best brokers in the world to operate here. Elections in November… we vote!
All brokers. They don’t have to do much to ‘fudge’ it, besides make trades on their own accounts. This is legal and they have more than enough leverage to move the market a few pips at even the slowest times.
It’s not just the FBI, but moral policing and protecting the world is the prerogative of the US (that’s what they believe)
I feel it’s pretty lame for US authorities to not allow CFDs just because they think they won’t be able to regulate them like other financial instruments. They could have devised a way in all these years instead of just imposing a ban. As Jeff Goldblum famously said, ‘Life finds a way” fits perfectly with traders wanting to trade CFDs, as they have found a way to do so using offshore brokers, VPNs, and whatnot.
With leverage as well, I think it’s pretty harsh on the traders to be content with 30x leverage or even less when they could have easily made a lot more by using higher leverage. Moreover, those who are using let’s say 100x leverage know the risks involved with using such high leverage and would implement risk management strategies.
I think it’s all just a strategy to elude us traders from earning big and nothing else!
-As a US citizen, I can say that this kind of attitude is not shared by the general population. It is very frustrating that our government is always getting involved in other people’s business.
-Greed and control is also a big factor here. These things can take on many forms. Leverage limits and keeping things local ensures that no bad actors can try to manipulate (or hurt) the investment tools that so many have relied on for decades, especially rich politicians/law-makers.
We have many laws, policies, ideals etc. in this country that were originally designed by, and for, the affluent. Now, many of these dated ideas have become very restrictive in nature, and have even prohibited us, as a country, to evolve and progress. This does not only pertain to the financial sector, either, and it only perpetuates and worsens the wealth disparity gap in this country.
Perhaps it is all by design. Or, we just need someone that is in a position to make real change, that can recognize and understand these problems, and is willing and able to make a difference, all while having the best interests of the common people in mind.
But that is much easier said than done. Even if you find someone like that, it will not take long for them to realize that their good intentions mean nothing if their ideals do not correlate with their own political party that they have now become a puppet to. They also need to be able to resist the temptation of greed that comes in the form of lobbyists pushing for private/corporate agendas as well as campaign donors and the like.
The system is broken and corrupt. The outlook does not look good. Better to make your own way, as you describe.
@_METHOS I can understand, people are just people, the government makes trashy policies and then expects their citizens to follow them.
They won’t allow CFDs just because they would have a hard time monitoring the trades or as many people believe for the protection of traders. Tbh, traders will lose a lot less trading CFDs than what they lose gambling in Vegas. What I believe is that the government has already seen an opportunity to make profits manifolds with CFD trading, which is why they have banned it.
Something similar has happened with crypto, although it is not banned in the States, no clarity has been provided on it yet. Big corporates make governments and so, the latter would do whatever those big money moguls would say. Policies will be made according to the corporates and not the general public. I couldn’t agree with you on the fact that the system is broken and corrupt, hence people take different ways to get things done. There is no right or wrong in this, it’s all about what suits you the best, right?
Could or could not agree?
I meant to say I couldn’t agree with you more. I’m definitely against the current system, but the problem is, if you try to change the system, the system changes you, and eventually you become part of the system. That’s what happened in the past and that’s what I think will happen in the future. The problem ‘CFD is banned in the US’ is going to remain where it is until someone within the system wakes up and decides to do something about it.
Around 14:00 today, I learned from SageFX live chat rep that they no longer accept U.S. traders.
As a side note, I don’t seem to find any of the offshores will process deposits or withdrawals via anything except a crypto portal of some sort.
Having a bit of trouble navigating the sea changes.
Best to all.
Yes, I just got off chat with them. Looks like the U.S. regulators got ahold of them. Below is the chat I had with them. The bolded words are my own.
Hi, thank you for contacting SageFX. How may I help you today?
Blaise
you guys no longer except u.s. traders?
17:04
Unless you already have an Account on the platform, you are not able to have an account with us.
Blaise
what have change?
17:05
This change is due to change in regulations, James.
Blaise
what regulations? is it the u.s. regulations?
17:06
That is correct!
Blaise
Ok thanks
17:07
My pleasure! Will that be all for today?
Disagree strongly with this assessment… Things were great in Forex pre-2010. That’s when FATCA (trying to be cute for ‘fat cats’) and Dodd Frank passed. It turns out that Fat Cats are anyone making $50k-$400k. What we are experiencing in America is a slide into some type of neo-Marcist hell, NOT an entrenched age-old system of oppression. Same goes for the comments on changing the system. The system was not perfect, but pretty damn good in the 1990 and 2000s. Wealth disparity is never good for a civilization (agree here) and the best way to deal with it is by giving people the means to lift themselves up. More freedom creates more opportunity.
I expect you have a slightly different take on some points. Looming forward to hearing it… Cheers!
Curious to know what US regulations recently changed that would have resulted in SageFX’s sudden decision to not accept American traders anymore.
