Sam Araki, that runs the blog http://www.tradingpostfinancial.com/blog/, contacted me a few days ago thanking me for the following I was giving to FX Solutions acquisition and the new developments occurring in the US with the NFA (National Futures Association) and in Switzerland with the SFBC (Swiss Federal Banking Commission).

He also wanted to hear my opinion.

Even though I’m quite reluctant to give my opinion on issues related to FDM’s as I can easily be accused of being biased, I’ll dare to give you all my opinion… which will probably be exactly the same than yours.

Retail FX has been an unregulated market since its inception except in the UK and Australia. They both got very serious with it from the beginning.

In the US, the NFA did something but we all have seen that it was not enough. The list is long: Refco, FXLQ, One World…

Now the NFA is upset at the retail FX and is going to go from a very soft regulation to a probably too restrictive one as it could put some good firms out of business or in a critical situation. Besides, it seems the NFA is about to give a very appealing piece of cake to futures firms that entered the market later.

In Switzerland, SFBC has been totally absent from ruling the FX market and has now realized that this situation can no longer continue. So they are starting to work on it.

From FXstreet’s point of view, that is like spring showers as we unfortunately have been too many times led up to take decisions that don’t belong to us – we are an informative FX portal – but to the regulators…. Otherwise I’ll be delighted to be a regulator but of course I’d require to be paid for it

Now seriously, who am I to not accept firms of some countries as Eastern Europe for instance, Middle East or Asia that want to be part of our list of brokers?

Shouldn’t be their local authorities the responsible of those firms’ acts? If you can’t trust them as regulators, then what are they doing in business? Just get out and do not waste people’s time.

The criterion we are using at FXstreet.com is that your firm has to be regulated in the US, UK, Switzerland, Australia, Nordic countries and Japan…. Is this a serious criterion if the list of bankruptcies in the US never ends or if in Switzerland there is no public action yet? Then, what should we do? Forget about two out of three main plazas in the FX arena?

Very tough situation indeed here for us…. So I’m very happy that regulators are finally doing their job.

To finish, I’m also very in line with what Lars Christensen and Drew Niv said last Friday. FX is an asset class and it is time to be dealt and ruled as it deserves.
Also, FX consolidation through merger and acquisitions has been triggered by regulators, not by market natural behaviour. And FX Solutions acquisition proves it.

I think FX Solutions has proved to be a reliable firm in this shaky world of retail FX business so I´m very glad that this acquisition will help them to keep being at the top of the market.

Francesc