Earlier this year, the UK regulated social network for traders, FxStat, applied for and was granted additional permissions for its financial license including funds management and advisory services from the Financial Conduct Authority (FCA). At the time it was not clear why the firm needed the additional permissions but it was revealed that it has recently launched its own brokerage.
Called OneTrade, FxStat’s brokerage is naturally very social and copy trading focused. OneTrade’s business model is also said to be 100% agency-based, meaning that all client trades are executed as straight-through processing (STP) with no dealing desk.
The new brokerage seems to be just an addition to the offering of FxStat which has not changed its business model and still supports many MT4 brokers. On its site however, the logo of OneTrade now appears above all other compatible brokers.
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It remains to be seen if the social network’s business model remains broker-independent for very long. Other firms that started out as social or copy trading platforms, such as Tradeo, were eventually relaunched as full-fledged brokers based on their earlier social platforms. The leader in the social trading field, eToro, has been its own broker for years.
When Tradeo was relaunched as YouTradeFX late last year, the firm cited customer confusion as the reason for the switch.“Without doubt, the number one issue we heard again and again was the complexity of our registration funnels, as we weren’t a broker. Users needed to open and fund an account with a recommended broker, then return to Tradeo to sync their account.” This suggests that OneTrade will also help FxStat onboard new traders who are not linked to any broker when they join the network.