MetaQuotes Releases Build 600: Marketplaces, MT5 and Regulation in the Balance

As scheduled, MetaQuotes has announced that MT4 Build 600 has gone live yesterday evening. The new build brings to MetaTrader

As scheduled, MetaQuotes announced that MT4 Build 600 has gone live yesterday evening. The new build brings MetaTrader 4 users access to the company’s EA and other trading apps marketplace with the arrival of a new ‘Market’ tab on their platform. Until now, marketplace access via the platform was only being offered on MetaTrader 5, the firm’s much less-used trading offering. The intention to launch the marketplace was announced in the middle of last year, and is part of MetaQuotes’ business model shift to gain revenues from third-party apps being built for its product, such as trading signals.

metaquotesIn addition to the marketplace, Build 600 contains a major update to the MQL 4 coding language that is the foundation of the platform’s automated trading and custom indicator development system. With the update, MQL 4 becomes closer in language and functionality to MQL 5. According to the firm, existing MQL 4 files built previous to the update will continue to operate correctly.

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As written by Forex Magnates when the coming update was first made public, the result of the language change will be to create an environment where EA’s and other trading apps built for MT4 users will become more easily adaptable to the MT5 platform. Since its launch in 2010, MetaTrader 5 has failed to gain much traction compared to the well-established MT4 product. Even following multiple years by MetaQuotes to highlight the platform’s advantages, specifically server-side features, such as more efficiency in handling multiple trading servers as well as ‘bridgeless’ liquidity provider integration, very few brokers have embraced the product.

Among reasons for this is due to the entrenched position of MT4 and its existing EA and custom indicator eco-system. As MT5 uses MQL 5 versus MQL 4, MT4 users would need to redevelop their programs to allow them to work in the new trading platform. As such, even among new entrants to MetaTrader, such as IG and City Index that launched the platform last year alongside their proprietary offerings, both brokers elected to go with MT4 as it would allow them to market the existing user base. In addition, Saxo Bank, whose Co-CEO and Co-Founder Lars Seier Christensen, stated at the Forex Magnates 2012 London Summit that they were seriously taking a look at launching MT5 and becoming a leader in offering the platform after ignoring MT4, ultimately decided to pass on it.

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With the MQL4 upgrade, future programs written for the MT4 platform will now become easier to run on MT5. Looking ahead, this may finally allow for a deeper migration of broker and end-user traders to MetaTrader 5. However, while the rotation towards MT5 seems inevitable, it still may take several more years for it to catch up with MT4 due to the entrenched user base of old applications on the market. In this regard though, the app marketplace, where there is no coincidence that it is being launched on MT4 alongside the MQL update, will be used by MetaQuotes to accelerate the creation of new EAs. As the marketplace is now accessible by both MT4 and MT5 users, programmers will have incentives to create apps that can be used by both sets of traders instead of needing to develop separate programs. In addition, we suspect that with the exception of very popular existing MT4 EAs, MetaQuotes will limit the acceptance of apps on the marketplace to those using the new MQL 4 code.

Regulatory Limits

As MetaTrader 4 and 5 become portals for purchasing third-party EAs and accessing trading signals, one item that may limit MetaQuotes’ goal of being a global retail Forex trading toll collector, as well as the end to end platform choice of all brokers is regulation. Among regulatory trends, there has been the focus of financial authorities on autotrading and third-party apps. Questions such as whether the developer of autotrading strategies or social trading leaders needs to be licensed as a money manager are currently being debated around the world. In addition, during the 2013 Forex Magnates London Summit, brokers that are regulated in the US related to us that marketing of third-party products was in that area of discussion with the NFA. For example, the question was raised as whether including the mention of a popular third-party app in marketing literature was considered a recommendation of the product?

As such in MetaTrader’s case, some jurisdictions may decide that providing access to trading signals and EAs within the platform itself may require brokers to individually review each offering before making it available to customers. On this, a representative from MetaQuotes explained to Forex Magnates last year that with their trading signal product, they do offer brokers control to filter what signals are available for purchase by their clients. Therefore, it would be expected that such a filtering feature will also exist in the marketplace. However, the screening of products does limit the overall goal that MetaQuotes aims to achieve with the marketplace and the speed at which users rotate to MT5.

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