After years of contraction, the roster of U.S.-regulated forex brokers is starting to expand again.
When the Babypips thread Going Offshore to Escape the CFTC was launched in September 2010, there were 22 registered forex brokers in the U.S.
At that time, the CFTC had been ramping up its heavy-handed regulation of retail forex brokers for more than a year.
Less than seven years later, by early 2017, the number of U.S. brokers had declined to just four brokers (RFED’s, as the CFTC began to refer to them), with just two of those brokers (Forex•com, and Oanda) available to typical retail traders (those having modest net worth and/or modest trading capital, who did not qualify as Eligible Contract Participants - ECP’s).
Then in late 2017, IG Markets, the big, heavily-capitalized U.K. broker, announced their intention to set up shop in Chicago as a CFTC/NFA-regulated RFED, after an absence of six years from the U.S market. IG US (as the new U.S. subsidiary is known) began on-boarding clients in February 2019.
That brought the number of U.S.-registered RFED’s (retail forex brokers) to five, with three of them catering to ordinary retail traders (those not qualified as ECP’s).
Three more brokers currently have applications pending for NFA membership and CFTC-registration as RFED’s: New Zealand broker Brightwin Securities and Finance, Chinese (Taiwanese?) broker Nanshan Jinchuang Co., and most recently Trading•com Markets Inc (the name of a new U.S. subsidiary of Cyprus broker XM’s parent, Trading Point).
If and when these newcomers achieve U.S. registration, there will be eight retail forex brokers in the U.S., with six of them catering to ordinary retail traders (those not qualified as ECP’s).
Here are three recent articles from Finance Magnates describing in more detail the three brokers-in-waiting. The Chinese broker Nanshan Jinchuang is a bit of an enigma (and even Finance Magnates is at a loss to vet them at this point).
Here’s a “blast from the past” – a table listing the 22 U.S. brokers in business in 2010, before most of them were driven out of the U.S. market