While some EU-regulated brokers and clients are flying offshore, OctaFX is bucking the trend. The company has just confirmed to Finance Magnates that it acquired a new license from the CySEC. The permit will allow the firm to operate an EU-based subsidiary and onboard clients from across the continent.
OctaFX is at present operating via a St. Vincent and Grenadines subsidiary. While that is providing the firm with flexibility on leverage and bonuses to clients, the recent hardships of the industry in the offshore payments space is prompting firms to look for more stringent regulatory jurisdictions that can accommodate a wider base of clients.
While the EU market has become more difficult in recent months due to changes in the regulatory environment, companies continue to invest in the region. Client acquisition costs have increased materially over the past couple of quarters, reflecting a shifting marketplace.
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The new license which OctaFX is acquiring reflects a strong commitment to continue building the company’s business. While some brokers in the industry have been facing difficult months, especially since the start of 2019, as volatility across multiple asset classes collapsed, others appear to be determined to weather the storm.
The new regulatory framework introduced in August 2018 is reshaping the retail forex brokerage industry as a whole. With every new change in the market, some firms adapt better than others and squeeze out competitors.
According to the license details of OctaFX on the CySEC’s website, the company is planning to launch a new domain to service its clients in the EU. The www.octafx.eu website is at present showing an Under Construction message. The company appears to be planning to roll out its new website in the coming weeks.
After Brexit, the Cypriot regulator has once again become the preferred place to set up brokerage operations in the EU. With uncertainty still looking over the UK’s exit from the block, that stance is unlikely to change anytime soon.