Weekly Briefing: Is Prop Trading Facing Arbitrage Manipulation? XTB 2024 Results, and More

Two Brokers, One Brand, But Why?

Starting off our weekly news update is an interesting case of two brokers fighting for the same brand. Offshore broker BCS Markets (formerly BCS Forex), a part of the Russian financial conglomerate BrokerCreditService and a sister brand of the Russian-licensed forex dealer BCS-Forex, appeared to have rebranded itself as Ultima Markets. However, another retail trading broker named Ultima Markets already exists and offers contracts for difference (CFD) trading.

Although the company did not publicly announce it, according to the Internet Archive, BCS Markets rebranded earlier this month. However, the broker is still operating from the same web address, “bcsmarkets.com.” The Russian broker was previously managed by BCS Markets LLC.

Arbitrage in Prop Trading Models

Elsewhere, multiple prop firms have publicly opposed the arbitrage exploitation of their platforms. Additionally, several groups are offering services that claim to guarantee profits from prop trading activities. Although such exploitations are known, PipFarm’s CEO, James Glyde, recently pointed to the organized nature of such groups.

“A very important feature of this scheme is the ability to pressure firms into paying out after they are caught to avoid negative publicity and firms find themselves in a lose-lose situation,” Glyde wrote in an X (formerly Twitter) post.

XTB Reports 15% Revenue Jump, New Clients Increase Nearly 60%

And in Poland, XTB closed 2024 on a high note, delivering strong financial and operational results. The online brokerage firm also experienced a surge in new clients, adding nearly 500,000 over the year, a 59.8% increase.

This influx helped drive revenue up 15.8% to PLN 1.87 billion, while net profit climbed 8.6% year-over-year to PLN 859.4 million. Despite rising operational costs, XTB benefited from strong market trends and growing interest in financial instruments.

In another development, XTB plans to introduce spot cryptocurrencies to its offering, likely this year, Finance Magnates has learned. While digital assets have been available through the company since 2018, they were only offered as contracts for difference (CFD). the company, which aims to become an all-in-one financial super app, now plans to expand its offering to include "physical" cryptocurrencies .

Capital.com’s UAE Traders Post Record $469 Billion in Volume

Meanwhile, the United Arab Emirates (UAE) has established itself as a dominant force in global retail trading, with volumes reaching $468.9 billion in 2024, according to new data released by trading platform Capital.com. The UAE led global markets with 19.5 million trades - double the activity of second-place Germany while maintaining an impressive 62.53% positive return rate across trades.

“Our latest data shows the remarkable achievements of UAE traders, who are not only diversifying their strategies across a wide range of instruments but also delivering healthy returns from their trades,” Tarik Chebib, the CEO of Capital.com MENA, said.

NAGA Boosts Crypto Trading With New CFD Offering

Another broker, NAGA, launched a new feature to enhance the accessibility of crypto CFD trading. Dubbed CryptoX, the new platform promises to eliminate overnight fees on long positions, offer real-time market exposure and enable traders to start with as little as $1.

By integrating with NAGA’s copy trading feature, CryptoX also enables users to mirror successful trading strategies. According to the company, one of the standout features of CryptoX is the elimination of overnight fees on long (BUY) positions.

easyMarkets Q4 2024 Results

Still, with the brokerage space, easyMarkets saw a sharp rise in cryptocurrency trading in the fourth quarter of 2024, with Bitcoin surpassing $100,000. This price surge drove strong interest from traders, making crypto the dominant asset class on the platform. Trading volumes for cryptocurrencies tripled compared to the third quarter, reflecting increased market activity and investor confidence.

Several factors contributed to this growth. Institutional investors played a major role, with companies like MicroStrategy announcing plans to raise $42 billion for crypto purchases. The re-election of a pro-crypto US president further fuelled optimism, as traders anticipated a more favorable regulatory environment.

Robinhood "Begun Rolling Out" Futures Trading

Robinhood is expanding its offerings by adding futures trading with “S&P 500, oil, Bitcoin , and more.” The broker announced that it has already begun rolling out futures trading. However, the American broker did not specify a date for the wider launch of the futures instruments.

A dedicated page on Robinhood’s website also indicates that it will launch futures trading with forex pairs, cryptocurrencies, indices, and commodities. As seen on the website, Robinhood will offer four crypto futures products: Bitcoin Futures, Micro Bitcoin Futures, Bitcoin Friday Futures, and Ether Futures.

Binance Faces Fresh Trouble in France

In France, Binance is facing yet another regulatory storm. The country's authorities have now launched a criminal investigation against crypto exchange, alleging tax fraud, money laundering, and illegal operations tied to drug trafficking. According to a report by Reuters, the investigation, led by France's financial crime unit, accuses Binance of facilitating money laundering linked to drug trafficking.

The case spans between 2019 and 2024. Prosecutors claim the platform failed to report suspicious activities and operated without necessary approvals in France and other European Union countries. Complaints from users who said they lost money due to misleading communication and unlicensed trading practices fueled the probe.

In another enforcement action, the Financial Conduct Authority (FCA) imposed its first fine for transaction reporting failures under the UK Markets in Financial Instruments Regulation against Infinox. The reporting failure occurred between 1 October 2022 and 31 March 2023 for single-stock CFDs traded through one of the broker’s corporate brokerage accounts.

A Bureaucratic Blizzard amid Global Tensions

Lastly, Trump's federal aid freeze sparked widespread confusion as the Doomsday Clock advances, highlighting global uncertainties. In a move that caught many off guard, the Trump administration recently announced a sweeping freeze on federal financial assistance. The Office of Management and Budget (OMB) issued a memo ordering a "temporary pause" on federal aid, excluding programs like Social Security and Medicare but leaving the status of others, such as Medicaid and FAFSA, in limbo.

The stated aim was to halt funding for initiatives linked to foreign aid, non-governmental organizations, diversity, equity, and inclusion programs, and environmental policies associated with the Green New Deal. Any federal aid freeze can potentially send shockwaves through an economy, particularly in industries that rely heavily on government funding, such as infrastructure, education, and healthcare.