GAIN CEO States Increased Regulation a Long-Term Positive for Industry

GAIN Capital’s (NYSE:GCAP) CEO Glenn Stevens has released additional comments regarding the recent regulatory fallout from this week that effectively upended the FX market in the United States.

To unlock the Asian market, register now to the iFX EXPO in Hong Kong.

[gptAdvertisement]

Earlier this week, GAIN Capital (NYSE:GCAP) entered into a definitive agreement to buy the US client book of FXCM (NASDAQ:FXCM) following its ban from the National Futures Association (NFA).

The move has massive ramifications for the US FX market, given FXCM’s market share domestically, which previously was calculated at 36.0%. The impending acquisition of the US client portfolio of FXCM will effectively make GAIN Capital the biggest brokerage in the country.

According to Stevens in a statement on the role of regulators in the US: "GAIN is in favor of measures which serve to enhance consumer protection, safeguard customer assets, increase transparency and make brokers more effective in meeting customer needs.”

"GAIN believes that increased Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term will have a long-term positive impact on the industry and will lead to further consolidation around a smaller number of larger firms. With GAIN's size, scale and global reach and experience with regulatory regimes across the world, as well as our track record as an industry consolidator, we are well-positioned for the future," he added.

The comments come during an already ongoing industry contraction in the US, which has seen a field winnowed down to only a handful of FX brokers due to regulatory constraints imposing strict capital requirements, among other Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term.

In light of this, the Trump administration has shown a willingness to dismantle Dodd-Frank, which could eventually have major consequences for brokers operating domestically. However, this process will be difficult to undergo logistically, and so it is unlikely to foster any other dramatic shakeups in the FX market in the foreseeable future.