By Chris Cammack Updated: April 24, 2020

The Cyprus Securities and Exchange Commission (CySEC) is the financial regulator of the Mediterranean island of Cyprus.  Cyprus has been a hub for the Forex industry for almost two decades and most European brokers base themselves here to take advantage of CySEC’s experience and the well-managed regulatory environment.

CySEC is also well-regarded amongst traders for the stringent standards they apply to brokers and the secure trading environment that CySEC-regulated brokers offer as a result. These are the best CySEC regulated brokers compared by reputation, platform support and trading conditions.

These are the best CySEC regulated brokers compared by reputation, platform support and trading conditions.

By Chris Cammack Updated: April 24, 2020
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  • Broker
    HotForex

    HotForex  - Best CySEC Broker

    REGULATED BY
    CySEC CySEC
    FCA FCA
    FSCA FSCA
    DFSA DFSA
    FSC FSC
    Trading Desk Type
    Minimum Deposit
    ZAR 70
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • Energies
    • Bonds
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Bitcoin
    • VLOAD
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    Micro1.0 pipsNoneMarketUSD 5 Account Details
    Islamic1.0 pipsNoneMarketUSD 100 Account Details
    Premium1.0 pipsNoneMarketUSD 100 Account Details
    Auto1.0 pipsNoneMarketUSD 200 Account Details
    Zero0.0 pips$3.00MarketUSD 200 Account Details
    HFCopy1.0 pipsNoneMarketUSD 300 Account Details
    Premium Pro1.0 pipsNoneMarketUSD 5000 Account Details
  • Broker
    FXTM

    FXTM  - Most Trusted Broker

    REGULATED BY
    CySEC CySEC
    FCA FCA
    FSCA FSCA
    FSC FSC
    Trading Desk Type
    Minimum Deposit
    USD 10
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Bitcoin
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    Cent Account1.5 pipsNoneInstantUSD 10 Account Details
    Standard Account1.3 pipsNoneInstantUSD 100 Account Details
    ECN Zero Account1.5 pipsNoneMarketUSD 200 Account Details
    ECN Account0.1 pips$2.00MarketUSD 500 Account Details
    FXTM Pro Account0.0 pipsNoneMarketUSD 25000 Account Details
  • Broker
    Plus500

    Plus500  - Most Assets Available

    REGULATED BY
    FCA FCA
    CySEC CySEC
    ASIC ASIC
    MAS MAS
    Trading Desk Type
    Minimum Deposit
    ZAR 1500
    Trading Conditions
    Trading Platforms
    • Plus500
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • Vanilla Options
    • ETFs
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Paypal
    AccountSpread FromCommissionExecutionMin. Deposit
    Standard0.0 pipsNoneInstantUSD 100 Account Details
  • Broker
    Admiral Markets

    Admiral Markets  - Best Trading Platforms

    REGULATED BY
    ASIC ASIC
    CySEC CySEC
    FCA FCA
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    • MT Supreme
    Trading Instruments
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • Bonds
    • WTIs
    Deposit Methods
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • POLi
    • Bitcoin
    • Bank Transfer
    AccountSpread FromCommissionExecutionMin. Deposit
    Trade.MT40.5 pipsNoneMarketUSD 100 Account Details
    Trade.MT50.5 pipsNoneMarketUSD 100 Account Details
    Zero.MT40.0 pips$1.8-$3.0MarketUSD 100 Account Details
    Zero.MT50.0 pips$1.8-$3.0MarketUSD 100 Account Details
  • Broker
    BDSwiss

    BDSwiss  - Best Trading Conditions

    REGULATED BY
    CySEC CySEC
    FSC FSC
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    Deposit Methods
    • Bank Transfer
    • Sofort Banking
    • Visa
    • Mastercard
    • Skrill
    AccountSpread FromCommissionExecutionMin. Deposit
    Basic1.5 pipsNoneInstantUSD 100 Account Details
    RAW Spread0.0 pipsNoneInstantUSD 200 Account Details
    Black1.1 pipsNoneInstantUSD 10000 Account Details
  • Broker
    FP Markets

    FP Markets  - Best Education

    REGULATED BY
    ASIC ASIC
    CySEC CySEC
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    • IRESS
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Paypal
    • Skrill
    • Neteller
    • Fasapay
    • BPay
    • paytrust88
    • POLi
    AccountSpread FromCommissionExecutionMin. Deposit
    Standard IRESSN/A pips$10 AUD min, then 0.1%STPUSD 1,000 Account Details
    Platinum IRESSN/A pips$9 AUD min, then 0.09%STPUSD 25,000 Account Details
    Premier IRESSN/A pipsNo min, then 0.08%STPUSD 50,000 Account Details
    RAW0.0 pips$3.50STPUSD 100 Account Details
    Standard1.0 pipsNoneSTPUSD 100 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    ASIC ASIC
    IFSC IFSC
    Trading Desk Type
    Minimum Deposit
    USD 5
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • Energies
    Deposit Methods
    • Bank Transfer
    • Sofort Banking
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Bitcoin
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    Micro1.0 pipsNoneInstantUSD 5 Account Details
    Standard1.0 pipsNoneInstantUSD 5 Account Details
    XM Ultra Low0.6 pipsNoneInstantUSD 50 Account Details
    XM Zero0.6 pips$7.00InstantUSD 100 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    FCA FCA
    FSC FSC
    Trading Desk Type
    Minimum Deposit
    USD 1
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Cryptocurrencies
    • Forex
    • Metals
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    AccountSpread FromCommissionExecutionMin. Deposit
    Standard Cent MT40.3 pipsNoneMarketUSD 1 Account Details
    Standard MT40.1 pipsNoneMarketUSD 1 Account Details
    Standard MT50.2 pipsNoneMarketUSD 1 Account Details
    Pro0.1 pipsNoneMarketUSD 200 Account Details
    Raw Spread0.0 pips$3.50MarketUSD 200 Account Details
    Zero pips$3.50MarketUSD 200 Account Details
  • REGULATED BY
    CySEC CySEC
    ASIC ASIC
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • Metals
    • Vanilla Options
    Deposit Methods
    • Bank Transfer
    • Sofort Banking
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Astropay
    AccountSpread FromCommissionExecutionMin. Deposit
    Islamic1.9 pipsNoneInstantUSD 100 Account Details
    Standard1.9 pipsNoneInstantUSD 100 Account Details
    Premium1.4 pipsNoneInstantUSD 2000 Account Details
    VIP0.9 pipsNoneInstantUSD 10000 Account Details
    Super VIP1.2 pipsNoneInstantUSD 50000 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    FCA FCA
    IFSC IFSC
    Trading Desk Type
    Minimum Deposit
    USD 5
    Trading Conditions
    Trading Platforms
    • MT4
    • xStation5
    Trading Instruments
    • Commodities
    • Forex
    • Indicies
    • Metals
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Paypal
    AccountSpread FromCommissionExecutionMin. Deposit
    Islamic0.28 pips$10.00InstantUSD 5 Account Details
    Pro0.28 pips$7.00InstantUSD 5 Account Details
    Standard0.35 pipsNoneInstantUSD 5 Account Details
  • REGULATED BY
    CySEC CySEC
    ASIC ASIC
    FSCA FSCA
    Trading Desk Type
    Minimum Deposit
    ZAR 2500
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Metals
    • Equities
    • Energies
    • ETFs
    • Bonds
    • Blends
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Paypal
    AccountSpread FromCommissionExecutionMin. Deposit
    Live0.9 pipsNoneInstantUSD 250 Account Details
  • Broker
    REGULATED BY
    FCA FCA
    CySEC CySEC
    FSCA FSCA
    DFSA DFSA
    SCB SCB
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    • cTrader
    • FxProEdge
    Trading Instruments
    • Forex
    • Indicies
    • Metals
    • Equities
    • Energies
    • Futures
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    FxPro cTrader0.45 pips$4.50MarketUSD 100 Account Details
    FxPro MT41.2 pipsNoneMarketUSD 100 Account Details
    FxPro MT51.52 pipsNoneMarketUSD 100 Account Details
    Islamic1.2 pipsVariableMarketUSD 100 Account Details
  • REGULATED BY
    FCA FCA
    ASIC ASIC
    DFSA DFSA
    Trading Desk Type
    Minimum Deposit
    USD 5
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • WTIs
    Deposit Methods
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Bank Transfer
    AccountSpread FromCommissionExecutionMin. Deposit
    MT4 Pro Account0.1 pips$7MarketUSD 5 Account Details
    MT4 Standard Account1.0 pipsNoneMarketUSD 5 Account Details
  • REGULATED BY
    CySEC CySEC
    FSCA FSCA
    VFSC VFSC
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Futures
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • Energies
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    AccountSpread FromCommissionExecutionMin. Deposit
    ECN Premium Account0.1 pips$10.00MarketUSD 100 Account Details
    Variable Account1.5 pipsNoneMarketUSD 100 Account Details
  • REGULATED BY
    CySEC CySEC
    FCA FCA
    FSA-Seychelles FSA-Seychelles
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • Bonds
    • WTIs
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • SticPay
    • Unionpay
    • Fasapay
    AccountSpread FromCommissionExecutionMin. Deposit
    Classic1.6 pipsNoneMarketUSD 100 Account Details
    Pro0.0 pipsVariableMarketUSD 100 Account Details
    VIP0.0 pipsVariableMarketUSD 50000 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    FCA FCA
    ASIC ASIC
    Trading Desk Type
    Minimum Deposit
    USD 200
    Trading Conditions
    Trading Platforms
    • etoro
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    Deposit Methods
    • Visa
    • Mastercard
    • Neteller
    • Unionpay
    • Skrill
    • Paypal
    AccountSpread FromCommissionExecutionMin. Deposit
    Professional1.0 pipsNoneMarketEUR 200 Account Details
    Standard1.0 pipsNoneMarketUSD 200 Account Details
  • REGULATED BY
    CySEC CySEC
    ASIC ASIC
    Trading Desk Type
    Minimum Deposit
    USD 200
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    • cTrader
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • Bonds
    • Futures
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Paypal
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    RAW - cTrader0.0 pips$3.00MarketUSD 200 Account Details
    RAW - MetaTrader0.0 pips$3.50MarketUSD 200 Account Details
    Standard - MetaTrader1.0 pipsNoneMarketUSD 200 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    FCA FCA
    ASIC ASIC
    FSCA FSCA
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • Futures
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    • Unionpay
    • Fasapay
    AccountSpread FromCommissionExecutionMin. Deposit
    Live Fixed Spread2.2 pipsNoneInstantUSD 100 Account Details
    Live Floating Spread1.1 pipsNoneInstantUSD 100 Account Details
    Live Zero Spread0.0 pips$18InstantUSD 500 Account Details
    STP/ECN No Commission1.7 pipsNoneECN/STPUSD 500 Account Details
    STP/ECN Zero Spread0.0 pips$7.50ECN/STPUSD 500 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    FCA FCA
    DFSA DFSA
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • Futures
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • WebMoney
    AccountSpread FromCommissionExecutionMin. Deposit
    Classic1.2 pipsNoneInstantUSD 100 Account Details
    Fixed1.8 pipsNoneInstantUSD 100 Account Details
    Islamic Fixed1.8 pipsNoneInstantUSD 100 Account Details
    Raw0.2 pips$4.00InstantUSD 200 Account Details
  • REGULATED BY
    CySEC CySEC
    B.V.I FSC B.V.I FSC
    Trading Desk Type
    Minimum Deposit
    USD 150
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Commodities
    • Forex
    • Equities
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Bitcoin
    • Unionpay
    • Broker to Broker
    AccountSpread FromCommissionExecutionMin. Deposit
    Cent.Eurica pips0.03%-0.07%InstantUSD 5 Account Details
    Cent.Standard3 pipsNoneInstantUSD 5 Account Details
    Insta.Eurica pips0.03%-0.07%InstantUSD 5 Account Details
    Insta.Standard3 pipsNoneInstantUSD 5 Account Details
    Islamic pipsNoneInstantUSD 5 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    Trading Desk Type
    Minimum Deposit
    USD 50
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    • cTrader
    Trading Instruments
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    Deposit Methods
    • Visa
    • Skrill
    • Neteller
    • Bitcoin
    • Fasapay
    • Bank Transfer
    AccountSpread FromCommissionExecutionMin. Deposit
    cTrader ECN pips$3.00MarketUSD 100 Account Details
    MT4 Micro0.4 pipsNoneMarketUSD 100 Account Details
    MT5 Pro0.2 pipsNoneMarketUSD 500 Account Details
  • REGULATED BY
    CySEC CySEC
    Trading Desk Type
    Minimum Deposit
    USD 500
    Trading Conditions
    Trading Platforms
    • MT4
    • Sirix
    Trading Instruments
    • Commodities
    • Forex
    • Indicies
    • Equities
    • ETFs
    Deposit Methods
    • Visa
    • Mastercard
    • Maestro
    • Skrill
    • Neteller
    AccountSpread FromCommissionExecutionMin. Deposit
    Mini4.0 pipsNoneInstantUSD 500 Account Details
    Standard3.0 pipsNoneInstantUSD 1000 Account Details
    Gold2.0 pipsNoneInstantUSD 5000 Account Details
    IslamicNot Published pipsNoneInstantUSD 10000 Account Details
    Platinum2.0 pipsNoneInstantUSD 10000 Account Details
    VIP1.6 pipsNoneInstantUSD 50000 Account Details
  • Broker
    REGULATED BY
    CySEC CySEC
    IFSC IFSC
    Trading Desk Type
    Minimum Deposit
    USD 1
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Metals
    • Equities
    Deposit Methods
    • Visa
    • Neteller
    • Unionpay
    AccountSpread FromCommissionExecutionMin. Deposit
    Cent1.0 pipsNoneSTPUSD 1 Account Details
    Islamic0.0 pipsNoneSTPUSD 1 Account Details
    Micro3.0 pipsNoneSTPUSD 5 Account Details
    Standard0.5 pipsNoneSTPUSD 100 Account Details
    Zero Spread0.0 pips$20STPUSD 500 Account Details
    ECN0.0 pipsNoneECNUSD 1000 Account Details
  • REGULATED BY
    CySEC CySEC
    FCA FCA
    DFSA DFSA
    Trading Desk Type
    Minimum Deposit
    USD 200
    Trading Conditions
    Trading Platforms
    • MT4
    • MT5
    Trading Instruments
    • Cryptocurrencies
    • Forex
    • Indicies
    • Metals
    • Equities
    • WTIs
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Fasapay
    AccountSpread FromCommissionExecutionMin. Deposit
    Classic1.4 pipsNoneMarketUSD 50 Account Details
  • REGULATED BY
    CySEC CySEC
    Trading Desk Type
    Minimum Deposit
    USD 10
    Trading Conditions
    Trading Platforms
    • IQ option
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    • ETFs
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    • Bitcoin
    AccountSpread FromCommissionExecutionMin. Deposit
    Live AccountUnpublished pipsNoneInstantUSD 5 Account Details
  • REGULATED BY
    CySEC CySEC
    Trading Desk Type
    Minimum Deposit
    USD 500
    Trading Conditions
    Trading Platforms
    • MT4
    • Sirix
    Trading Instruments
    • Commodities
    • Forex
    • Equities
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    • Neteller
    AccountSpread FromCommissionExecutionMin. Deposit
    InstitutionalNot Published pipsNot PublishedMarket Volume Based Account Details
    Basic2.4 pipsNoneMarketUSD 500 Account Details
    Standard1.4 pipsNoneMarketUSD 5000 Account Details
    Advanced Mark-Up1.1 pipsNoneMarketUSD 10000 Account Details
    Advanced RAW0.0 pips$5.50MarketUSD 10000 Account Details
    Premium Mark-up0.8 pipsNoneMarketUSD 50000 Account Details
    Premium RAW0.0 pips$4.00MarketUSD 50000 Account Details
  • REGULATED BY
    CySEC CySEC
    IFSC IFSC
    Trading Desk Type
    Minimum Deposit
    USD 100
    Trading Conditions
    Trading Platforms
    • MT4
    Trading Instruments
    • Commodities
    • Cryptocurrencies
    • Forex
    • Indicies
    • Equities
    Deposit Methods
    • Bank Transfer
    • Visa
    • Mastercard
    • Skrill
    AccountSpread FromCommissionExecutionMin. Deposit
    Basic2.5 pipsNoneMarketUSD 250 Account Details
    Gold2.0 pipsNoneMarketUSD 5000 Account Details
    Platinum1.4 pipsNoneMarketUSD 10000 Account Details
    VIP1.1 pipsNoneMarketUSD 50000 Account Details

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All Forex Brokers in South Africa

Broker Regulation and Why it’s Important

Regulators are essential in all financial markets because they set the rules that guarantee a level playing field. They also enforce those rules by requiring members to submit regular reports and have independent audits, most good regulators will also have an investigations department and will conduct unannounced visits to regulated companies to ensure day-to-day operations are compliant. Regulators also have the power to impose penalties on members, including fines, sanctions and even revoking a company’s operating licence, thereby putting them out of business.

What is interesting about the Forex market is that there is no legal requirement for brokers to be regulated. CFD Forex trading is an Over the Counter (OTC) derivatives market – this means that there is no central exchange and no overall regulator with oversight for the market.

Having a wholly unregulated market is a bad idea and leads to massive consumer fraud, as happens on a smaller scale in regions with poorly regulated local Forex industries. Instead of having a single regulator, countries and regions regulate the brokers who reside in their territory. As each regulator has different abilities and priorities, Forex regulation is not uniform, and brokers must abide by different rules depending on which country/countries they are legally resident.

What is CySEC?

CySEC is the financial regulatory agency of Cyprus. It was founded in 2001 and when Cyprus joined the EU in 2004 CySEC became part of the pan-European MiFID (Markets in Financial Instruments Directive). MiFID is an EU law the harmonises regulation for financial services across the member states, allowing for financial firms registered in one state to essentially have a “passport” to operate in all the other EU states.

In terms of the Forex industry, this means that any Forex broker registered in Cyprus can market to, and accept business from, all EU citizens.

As the Cyprus financial regulator, CySEC has many crucial obligations in the financial sector – most of them outside the Forex industry – these are:

  • To review applications for and provide operating licenses to supervised financial companies – and revoke these if necessary.
  • To supervise and regulate the operation of and all transactions on the Cyprus Stock Exchange
  • To carry out all necessary investigations in view of the exercise of its duties under the law as well as on behalf of other foreign competent Authorities.
  • To impose administrative and disciplinary sanctions provided by the law.
  • To issue regulatory Directives and Decisions.
  • To cooperate and exchange data and information with foreign supervisory authorities.

How CySEC protects Forex traders

So how does CySEC protect Forex traders? As I mentioned at the top, most Forex brokers in Europe are based in Cyprus and are subject to CySEC’s regulations, so it follows that many millions of Forex traders are directly impacted not only by CySEC’s rules but also by how well they enforce them. The most important regulatory benefits for customers of a CySEC-regulated broker are as follow:

  • Segregated Funds: All trader funds are kept in a segregated trust account which the broker cannot access. This prevents the broker from using trader funds for operational purposes. It also ensures that in the case of broker bankruptcy, trader funds can be returned.
  • Capital Adequacy: CySEC requires all regulated brokers to hold enough capital to meet the capital adequacy ratio requirement. This decreases the likelihood of broker failure in the event of significant losses.
  • Reports and Auditing: Because brokers are required to submit regular financial compliance reports to CySEC, it is very difficult for brokers to hide any wrongdoing. Similarly, because these brokers are also subject to independent audits and visits from CySEC investigators, any malfeasance will be exposed.
  • Compensation Fund: All CySEC-regulated brokers are required to join the Investor Compensation Fund Scheme. Under this scheme, traders are liable for compensation up to 20,000 EUR in the case of broker bankruptcy.
  • Insurance Coverage: CySEC demands that all licenced brokers maintain insurance coverage of at least 1.5 million EUR for losses resulting from negligence.
  • Transparency: CySEC expects to have a complete overview of all products that a broker is planning to offer, and that these products are the same as the products offered to clients.

These protections are enshrined in regulatory law and brokers who are found to be in contravention are penalised and can even have their operating licence removed altogether.

A useful resource for traders, CySEC hosts an up-to-date list of brokers that are legally allowed to operate in their jurisdiction, if you are concerned that a broker may be operating illegally, check CySEC’s regulated entities list.

CySEC also publishes warnings on unregulated brokers operating illegally, many illegal brokers will often disguise themselves as regulated brokers so it is important to check here if you are concerned.

CySEC and ESMA: Restrictions on Trading Conditions

In March 2018, the European Securities Markets Authority (ESMA – a EU taskforce which examines EU-wide financial risk) announced new regulations on all CFD trading in the EU; these regulations were a directive at the supranational level – meaning that all EU members were required to abide by the regulations and enshrine them in domestic law.

Cyprus, as an EU member state, must also abide by this new set of regulations and all CySEC-regulated brokers will have the following restrictions as a result:

  • Leverage Restriction: Maximum leverage of 30:1 on major currency pairs, 20:1 on all other pairs, 5:1 on equities, 2:1 on cryptocurrencies
  • Negative Balance Protection: All brokers must guarantee negative balance protection for all traders
  • No Bonus: All bonuses, promotions or any other type of trading incentive are banned
  • Margin Call: Brokers will be required to close a client’s open positions when the account equity reaches 50% of the required minimum margin by all open positions.
  • Risk Warning: All brokers will be required to display a standard risk warning showing what percentage of clients lose money with them.

While many traders and brokers were unhappy with the restriction on leverage, many people in the Forex industry agree that the new ESMA regulations protect traders from making huge losses without critically damaging broker profits.

CySEC vs FCA

The Financial Conduct Authority is the United Kingdom’s financial regulator and is generally upheld as the best and strictest national regulatory authority in the world. Most good brokers will be regulated either by CySEC, the FCA or sometimes both.

On paper, there is little difference between CySEC or FCA regulation – though the licencing fee for CySEC brokers is only 7,000 EUR, compared to 25,000 GBP for the FCA. Aside from that, both regulators require segregated accounts, membership of a compensation fund and have high capital adequacy standards. All brokers regulated by both authorities will have the same leverage restrictions and other constraints required by the ESMA regulation – though whether this continues to remain the case once the United Kingdom leaves the EU remains to be seen.

The differences between the two regulators are mainly anecdotal, while the FCA is seen as unimpeachable when it comes to protecting consumers and being tough on brokers, many traders complain that CySEC is too broker-friendly and that it gives away operating licences too easily. CySEC also has a history of being easy on badly behaved brokers, with industry commentators noting that fines being levied by CySEC tended to be smaller than those handed out by other EU regulatory organizations.

But since 2016, CySEC has made sweeping changes to both the registration and regulation processes of all registered entities. Changes include more transparency regarding existing listed entities, tougher fines and regular unannounced onsite visits from CySEC investigators to check compliance. This has led to a surge in broker suspensions and license revoking and CySEC is gradually losing its image as a light-touch regulator.

Conclusion

As the regulator with the most EU registered brokers, CySEC has a critical role in the Forex industry and millions of traders rely on their ability to ensure a fair trading environment.

While in the past, this ability has been questioned, currently CySEC is seen as a leader in the Forex regulatory world and brokers with CySEC regulation should be considered safe and secure places for trading.

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Trading Forex and CFDs is not suitable for all investors and comes with a high risk of losing money rapidly due to leverage. 75-90% of retail investors lose money trading these products. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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