Best Forex Brokers in the US
Searching for great forex brokers in the USA is slightly more difficult than in the rest of the world. This is because, as the regulations for forex brokers are much more demanding in the US than anywhere else, there are simply fewer forex brokers who accept US traders.
The strict licensing laws in the US have also led to many rogue brokers accepting US traders, even though they are not certified. This means that finding a broker you can trust can be a hard task, but fortunately, we’re here to help.
Our experts have provided you with a list of all the best FX brokers for US traders. Whilst this list may be short, you can rest assured that all of these traders are properly licensed, allowing you to trade in a safe and fair environment. On this page, you can also learn more about trading forex in the US, including:
- Why there so few US-certified forex brokers
- Which regulatory bodies operate in the US
- How US forex regulations protect you
Top US Forex Brokers In 2020
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Why Are There So Few US Forex Brokers?
As you can see from our list above, there are very few fully-regulated forex brokers in the US. This can lead many prospective traders to worry that trading forex is prohibited in the United States, but fear not, forex trading is perfectly legal in the USA.
So why, if forex trading is legal in the US, are there so few forex brokers who offer their services to American traders?
- The US forex market is heavily regulated
If a broker wants to offer it’s services to clients in the USA, it must obtain a license from the National Futures Association (NFA). This isn’t quite as straight forward as it is in other areas of the world.
For instance, to obtain a CySEC licence, a broker has to have between $100,00 and $500,000 of locked capital. In the US, however, a broker needs at least $20,000,000. This fee makes it extremely hard for new brokers to enter the market.
- It’s difficult to become profitable
The amount of capital needed for a forex broker to offer its services to US players isn’t the only thing which makes the US market an expensive one to enter. Under the rules of the NFA, brokers in America are only allowed to offer certain leverage ratios, namely 50:1 on major currency pairs and 20:1 on all other currency pairs.
This cuts into the profit a forex broker can make. Wages are also high in the US, which means they must pay more to run their brokerage. All in all, a lot of brokers see the US market as simply not worth it.
How about the USA regulation for Forex brokers?
Till the first years of the 21st century Forex trading and Forex brokers in USA were not regulated at all. Everything changed in 2008 year, when the 2008 Farm Bill was integrated as an official law act that puts important rules in this financial activity. Later, in 2010, the Dodd-Franc Wall street Reform Act of 2010 settled down the things even more specifically. Though, all the Forex brokers in USA, as well as the market here changed completely with the opening of the two official – up to now – regulation bodies. Since then, the two agencies take the control of the entire Forex trading activity in USA and for USA-based citizens.
- 1. National Futures Association
Known by the abbreviation of NFA across the Forex audience, the National Futures Association was at first the only body that gives official permissions and licenses to the USA Forex brokers. Today, it has yet such powers, but it also applies the significant and obligatory standards for all the Forex brokers in USA. Safety for clients – connected with the financial transactions and the personal data – is also taken by the NFA, too, and such cases can be opened according to specific procedures, too. Compliances and electronic fillings are options, which are available on the official NFA website, as well.
- 2. Commodity Futures Trading Commission
The Commodity Futures Trading Commission or the CFTC works to preserve the transparency, loyal competitiveness and financial stability to all the Forex brokers in USA. The procedures and measures this commission takes are all focused on the better trading processing, as well as on minimizing the systemic risk. The CFTC is also in charge to promote market integrity and to stop any act of violation or abuse. However, finding and charging frauds is the main mission that the Commodity Futures Trading Commission follows in its general work. Last, but not least, the CFTC is obliged to publically inform people about its actions – including about began investigation for a suspicious Forex brokers USA.
Discover the great options all those USA Forex brokers promise and provide you now. Go out in the web and search for the broker that will suit your needs and see if there is a good possibility for you to make financial trades regardless the fact you are an American citizen, who is usually limited by so many laws and restrictions. There is a way for you to determine a decent broker with no limits, so start your trial on such a trading platform now and tell us on mandatory what you think about these websites! Good luck, guys!