MT4 and binary options technology provider, TradeTools FX, has announced that they are waving transaction fees on their MT4 bridge. The news is coinciding with the US July 4th Independence Day holiday and they are using the occasion to rebrand their MT4 bridge as the ‘MT4 Freedom Bridge’. According to the company, the move is meant to save brokers from per million transaction fees which they believe can amount to tens of thousands of dollars a month for brokers processing over a half yard of volume a day.
As an alternative to volume based revenues, TradeTools FX charges brokers fixed monthly support fees that increase based on the scope of services provided. The flat fees also cover connection to the firm’s FXLite trading platform product. Transactional costs still exist with their binary options and MAM offerings. According to the firm, their clients currently process nearly $100 billion in trades per month through their MT4 bridge product.
ATFX Institutional Business Continues to Expand: Adding a New Prime BrokerGo to article >>
Commenting on the news, TraderTools FX Founder and Director, Val Lazovski stated “we feel that the bridge technology space has reached its peak and that the “toll collector” model is outdated and expensive. Bridge technology and its administration are virtually hands-free and require very low maintenance. Our view is that brokers should no longer be laying out a significant percentage of their revenues simply to connect to and aggregate feeds from their liquidity providers.”
The move from a volume to service fee revenue model was a topic that was discussed in an article earlier this year in regards to MetaQuotes launching a MT4 to MT4 liquidity gateway. Currently, the major bridge providers offer a model where they are compensated based on volumes that are processed through their bridge, while providing additional services for free. At the time, it was theorized that if the new product from MetaQuotes proved stable and scalable, it could attract smaller brokers that were more cost conscious to switch to it from using a third party bridge provider. As such, it was written that the result of MetaQuotes expansion could lead to some providers moving to a flat fee model. In the case of TradeTools FX, the move is based on the firm striving to attract forex brokers who ultimately also become users of their volume based binary options product. While the change isn’t the result of MetaQuotes entrance into the market, it does introduce the flat fee structure into the marketplace which could trigger similar arrangements from other providers.