A Top Fazzaco Story Calendar in 2024
2024 has quickly become a thing of the past. The Fazzaco team was fortunate enough to have your company throughout the year. Over the past 366 days, Fazzaco continued its focus on the forex B2B sector and expanded its coverage to include the emerging prop trading industry.
Last year, we maintained a high-intensity daily reporting schedule (excluding weekends), publishing a total of 2,317 news and articles. These covered a wide range of topics, including forex, brokerages, prop trading, cryptocurrencies, and broker solutions (payments, bridges, liquidity, white labels, licensing, trading software, risk management, plugins). We provided in-depth coverage and exclusive interviews on several hot topics, such as prop firms migrating platforms after regulatory crackdowns, MetaQuotes' discontinuation of older MT4/MT5 versions and increased licensing fees, the ongoing fallout from the FTX collapse, executive moves within the industry, institutional FX trading data, FX jobs, and major industry events and expos.
Now, let's take a trip back to 2024 and revisit the top headlines from Fazzaco each month.
Voices from the Industry: Is the Rise of Prop Trading A Disruption or Opportunity?
Fazzaco invited several executives from brokerages, fintech firms, and proprietary trading entities to reveal their real voices of the industry from multiple angles.
Key Takeaways:
Forex Resurgence in Prop Trading: Since 2023, factors like increased trading costs and regulatory shifts have driven proprietary trading firms (prop firms) towards the forex market, leading to a significant increase in their involvement. Acuiti's report indicates that 45% of prop firms offering currency trading plan to further increase their activity in 2024.
"Lambo Chasers" and the "Big Dream Effect": Social media narratives promoting "get rich quick" trading stories ("Lambo Chasers") and the general allure of high profits ("Big Dream Effect") have contributed to the prop trading boom.
Prop Firms vs. Brokers - Trader Perspective:
Prop Firms: Offer access to substantial capital but with less autonomy, performance pressure to meet targets, and no ownership of the capital.
Brokers: Provide more autonomy and control over capital and trading decisions, with regulatory protections for funds, but traders are limited by their own capital.
Prop Firms vs. Brokers - Business Perspective:
Prop Firms: Focus on profiting from market volatility using the firm's capital, offering high-profit potential but with direct capital exposure.
Brokers: Rely on commissions from client transactions, benefiting from a diverse client base but susceptible to market sentiment and commission dependency.
Regulatory Landscape: Prop trading currently lacks comprehensive regulatory oversight, unlike traditional brokerage. This poses potential risks but also allows for more agile risk management strategies. Responsible firms implement internal controls like exposure limits and compliance monitoring.
Risk Management: Prop firms, often operating under a B-Book model, use sophisticated technology and quantitative analysis for proactive risk management. Brokers use various models (A-Book, B-Book, Hybrid) with different risk mitigation approaches.
Competition and Coexistence: While some might see it as a competition, the article suggests that prop firms and brokers can coexist. Prop firms offer agility and innovation, while brokers provide a client-focused approach and regulatory safeguards. A combination of both could benefit the market through healthy competition.
A Timeline of the "February Diaspora" of Prop Firms
MetaQuotes' February decision to block white-label prop firms from using MetaTrader 4/5, partly due to US regulatory pressure on CFD trading for US clients, triggered a crisis in the prop trading industry.
Key takeaways:
Disruption: Numerous prop firms (e.g., True Forex Funds, Funding Pips, FTMO) were forced to suspend services, especially for US clients.
Platform Migration: Firms scrambled to migrate to alternatives like cTrader, DXTrade, and TradeLocker.
MetaQuotes' Power: The event highlighted MetaQuotes' significant control over the industry, acting as a gatekeeper.
Regulatory Influence: US regulatory pressure played a key role in MetaQuotes' decision.
CySEC Chairman Briefs on the 2023's Supervisory Efforts: AML/CFT, Fines, MiCA and Beyond
CySEC's 2023 performance, as outlined in a press conference by Chairman Theocharide, focused on increased oversight and preparation for MiCA implementation.
Key takeaways:
Increased Oversight: CySEC's supervised entities grew by 12% in four years, reaching 830. Over 700 on-site and remote inspections were conducted, focusing on AML/CFT compliance and sanctions against Russia.
Enforcement Actions: CySEC issued €2.2 million in fines (following €2.9 million in 2022), with €1 million levied against Itrade Global. 19 CIF licenses were revoked or suspended.
MiCA Preparation: CySEC is actively preparing for the 2024 implementation of MiCA, aligning with ESMA's roadmap. They emphasize the importance of regulated entities preparing for the new requirements.
Investor Protection: CySEC warned against investor risks associated with crypto assets due to a lack of awareness and online hype.
Fazzaco Talks to Executive Director of HTFX EU: Changing The Way You Trade Is More Than A Slogan
In the realm of financial services, innovation and client satisfaction are the cornerstones of a brokerage's success. It's not just about having cutting-edge platforms and technology, or unmatched customer support; it's also about the tangible experiences traders encounter in their transactions.
In this month, Fazzaco had the privilege of hosting Mr. Kyriakos Hadjikyriakou, the seasoned Executive Director of HTFX EU. With his rich tapestry of experience in finance, he has unfolded how HTFX breathes life into the slogan "Changing the Way You Trade," ensuring it transcends beyond mere words.
- What Do Brokers Do As More Traders Turn to Discord?
Discord, initially designed for gamers, has evolved into a popular platform for various communities, including retail traders. Its user-friendly interface, robust features, and strong community focus have attracted a significant number of traders seeking to share insights and discuss market trends.
This growing popularity has prompted some brokers and prop firms to explore integrating Discord into their operations. Match Trade Technologies implemented Discord login functionality, streamlining the client onboarding process by leveraging existing user accounts. This move suggests a potential trend of brokers adopting platforms where their target audience is already active.
- Shocking Survey Reveals A Mere 4% of Financial Institutions Fully Grasp AML Rules
In this article Fazzaco explored a report by Sanction Scanner that has revealed a concerning lack of understanding regarding anti-money laundering (AML) regulations within the financial sector.
A survey of over 400 respondents from 50 countries found that only a small fraction (4%) expressed complete confidence in their knowledge of current AML regulations and compliance measures. The majority of respondents indicated varying degrees of uncertainty, with many feeling "not very confident" or "somewhat confident."
- Binance Founder CZ Officially Behind Bars, But Not For Long
In June 2023, the U.S. Securities and Exchange Commission (SEC) filed 13 charges against CZ and Binance entities, alleging a web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.
By November 2023, CZ and the U.S. government reached a settlement, with Binance agreeing to pay a $4.3 billion fine and him personally paying a $50 million fine. This resolved the longstanding investigations into Binance, and he stepped down as CEO.
In April 2024, CZ was sentenced to four months in prison on money laundering charges, a sentence significantly lighter than the three-year term sought by U.S. federal prosecutors. On June 2, CZ reported to a low-security federal prison in California. (Update: CZ was released on September 27, 2024)
- Challenge Costs of Major Prop Firms Explained
At its core, prop firms provide traders with fund for trading, which is why some refer to them as "trader-funded firms." Yet, prop firms do not literally just hand out money; they offer a simulated trading environment and demo accounts that closely mirrors the real one with slight differences. Firms then utilize algorithmic trading (algo trading) and other automated mechanisms to mimic traders' moves on demo accounts for actual transactions.
Before one can call himself/herself a prop trader, firms enforce rigorous risk management protocols to vet applicants through the aforementioned "challenge," which typically involves a fee. The intent of this fee is to ascertain whether traders have the requisite skills and knowledge for profitable and accountable trading, or at least what being said is true for those firms that do not intend to just rip off some poor traders' money and disappear.
In this month, YaMarkets, a leading financial services company, announced the much-anticipated launch of YaMarkets AI, a revolutionary trade analysis reporting system powered by advanced artificial intelligence. This innovative tool empowers traders of all levels to gain deeper insights into their trading behaviour, optimise strategies, and ultimately achieve sharper trading decisions.
- Ongoing OANDA vs. GAIN Capital Dispute Intensifies Over FX Trading Patents
In July, the ongoing legal clash between OANDA and GAIN Capital entered a critical phase following unsuccessful attempts at settling their differences out of court. The dispute centers on allegations by OANDA that GAIN Capital infringed upon several patents crucial to its FX trading technologies, which encompass a range of innovations integral to OANDA's proprietary trading systems.
- Carla Nemr Bids Farewell to Tickmill After Eight Years
Carla Nemr, a pivotal figure in the leadership of Tickmill, has announced her departure from the company after nearly eight years of service. Joining Tickmill in 2017 as Head of Global Business Development, Nemr was promoted to Chief Business Development Officer in 2022.
Sidenotes: Fazzaco had the honor to talk to Carla Nemr a few times ("Exclusive Interview: Traders Are the First, Tickmill Carla Nemr Said") and she was also one of Fazzaco's The People of the Year of 2022 ("Person of the Year: Carla Nemr, Global Head of Business Development at Tickmill")
More Prop Firms Are Closing Down, When Will This Sh*tshow End?
In this month, the prop trading industry experienced significant turbulence, marked by a wave of prop firm closures. This disruption stemmed primarily from Eightcap, a major MetaTrader (MT4/MT5) provider, once again ceasing platform support for numerous small to medium-sized prop firms. This action, following similar events earlier in the year, left these firms unable to offer their services, leading to approximately twenty closures.
This ongoing instability has significantly impacted prop traders, raising concerns about the viability of many firms. Many traders expressed a preference for larger, more established firms like the5ers and FTMO, which offer trading on real accounts. The firms that closed after losing MT platform support typically operated using demo accounts for users, mirroring trades on their own real accounts, a common practice in the industry. However, larger firms often have higher challenge fees, lower leverage, and a more limited range of tradable assets, particularly CFDs, which are a key point of contention with U.S. regulators due to their OTC status.
The article also noted that successful prop firms often excel in marketing, particularly direct response, influencer, and social media marketing.
MetaQuotes Has Been Ruling for 20 Years, Is It Time to End?
MetaTrader 4, launched in 2005, became the dominant platform for retail forex trading, achieving widespread adoption despite its age.
Key takeaways:
MT4's dominance was driven by third-party plugins and scripts: This ecosystem fostered widespread adoption among brokers and traders.
MT5 failed to fully replace MT4: Despite its release, MT4 remained the preferred platform for a large majority of traders.
Recent events have strained broker relationships with MetaQuotes: Apple's App Store removal and the crackdown on grey labels created uncertainty and prompted some brokers to reconsider their reliance on MT platforms.
Larger brokers have already moved to proprietary platforms: Companies with significant resources have developed their own systems, reducing their dependence on MetaQuotes.
Concerns about MT's outdated design and MetaQuotes' inconsistent policies are growing: Brokers cite the platform's lack of modern user experience and unpredictable support as reasons for seeking alternatives.
A complete shift away from MT is unlikely in the near future: Despite these challenges, MT remains a standard in the industry, with a highly customizable system and a large user base, making a rapid transition improbable.
Traders Voice Frustrations As MetaQuotes Discontinues Older MT4 and 5 Versions
MetaQuotes made headlines again this month as on October 22, 2024, the company announced that starting December, it would cease technical support for older versions of its MT4 and MT5 platforms. For MT4, this includes any version earlier than build 1420, released on May 24, 2024, while for MT5, it covers versions before build 4410, released on June 21, 2024. Desktop clients using these earlier terminals will no longer be able to connect to brokers' servers.
- Alleged B2B Hub Scam Pt. I: A Forex Licensing Nightmare
- Alleged B2B Hub Scam Pt. II: A "Fake Biography" Under "Shell Companies" - Amiran Azaladze's Dirt
- Alleged B2B Hub Scam Pt. III: Amiran's Scheme Unmasked As New Evidence Emerges
In September 2024, shortly after Fazzaco launched the new "Whistleblower & Intelligence" feature, a grievance letter was sent to our e-mail inbox. Sent from a forex brokerage startup, the informant complained about a disturbing experience with a company named FX B2B Hub Ltd (now rebranded B2B Hub).
According to the broker (referred to as Broker A), B2B Hub, led by a person named Amiran Azaladze, promised to help them acquire a forex broker license in Vanuatu but failed to deliver after two years. Our source at Broker A, referred to as the Informant hereinafter, agreed to share the full story under anonymity, shedding light on how B2B Hub allegedly scammed the company.
Organic Traffic in 2024: Winners and Losers among CFD Brokers
In 2024, SEO (Search Engine Optimization) remains a crucial component of digital marketing for online businesses. As search engines continue to evolve and more people rely more and more on the internet for just about anything, its importance is expected to continue, if not increase, in 2025.
Cristian Cochintu, an independent SEO consultant with extensive expertise in the financial technology (fintech) sector, has analyzed the situation of CFD brokers that have occupied the top positions in the last 12+ months based on the estimated organic traffic.
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