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Best Forex Brokers for US Residents

Best Forex Broker in U.S.A

Best Forex Broker in the USA? If you’re looking for Forex brokers accepting US clients, you’ve come to the right place. There are not many Forex brokers right now that accept US clients, so finding a reliable Forex broker can be challenging. Lucky for you, we’ve done all the work for you.

Below you will find the best US Forex broker accepting US clients. These brokers are reputable and renowned as the best Forex brokers in the US. 

Due to the strict regulation in the United States, many forex brokers shy away from the US market, leaving the US’s retail foreign exchange market with very few choices. Make sure you check our list of Forex Brokers from Around the World.

Forex regulation in the USA

Forex trading is regulated by the NFA (National Futures Association) and the CFTC in the United States. Some of these rules that must be followed are listed below:

  • Limits leverage to 50: 1 for major currencies.
  • Limits leverage to 20: 1 for minor currencies.
  • First-in-First-out (FIFO).
  • US residents are only allowed to trade with US Forex brokers by NFA regulations.
  • Money owed by a foreign exchange broker to a client must be deposited with one or more appropriate institutions in the United States.
  • Retail forex trading brokers in the United States must maintain a minimum capital of at least $ 20 million and 5% of the amount for which liabilities to retail Fx clients exceed $ 10 million. Make it tough for any new business visitor as it takes a lot of capital just to get started.
  • Submit weekly financial reports to the NFA to ensure that all financials are in order.
  • Hedging is not permitted.

Forex brokers accepting US clients 2020

FxChoice.com

Broker type ECN

Regulations IFSC

Minimum deposit $ 100.00

Currency Account USD, EUR, GBP, AUD, CAD, Bitcoin, Gold, Bitcoin Cash, Litecoin, Ethereum, and XRP

Max leverage 200: 1

Trading platforms MetaTrader 4/5

Forex.com

Broker type Market Maker

Regulations NFA, CFTC , RFED, FCM

Minimum deposit $ 50.00

Base currency of the account USD CAD GBP

Max leverage 50: 1

Trading platforms FOREXTrader, Metatrader 4

Oanda.com

Broker type Market Maker

Regulations IIROC, CIPF, NFA , FCA, CFTC , ASIC, MAS

Minimum deposit $ 1.00

Base currency of the account AUD CAD EUR GBP HKD JYP SGD CHF USD

Max leverage 50: 1

Trading platforms Web Trading, Metatrader 4, Oanda Desktop Trading Platform

Also read  LiteForex Broker Review 2021

INFO on US foreign exchange brokers

The popularity of Forex continues to grow. The market is flooded with thousands of forex brokers from different countries. 

The existence of so many options overwhelms new traders. Choosing the right forex broker is essential to becoming a successful trader. Unfortunately, the forex market does not have universal regulation, unlike the stock market. Traders are responsible for selecting licensed and regulated forex brokers.

Many countries allow forex brokers to operate without stringent licensing requirements. US foreign brokers are among the safest brokers out there because the US requires all FX brokers to be licensed. Regulated forex brokers must ensure the safety of your investment, thereby protecting your money.

The US government has taken huge steps to regulate the forex market. Foreign exchange brokers operating outside the United States must comply with NFA (National Futures Association) and CFTC (Commodity and Futures Trading Commission) requirements. 

Some FX brokers have complained that strict regulations prevent them from providing great opportunities for their traders. However, these rules ensure that traders can have peace of mind when investing in a highly volatile market.

US forex brokers must adhere to the NFA regulations and register with the CFTC before starting foreign exchange transactions in the US. 

This was not the case before 2008. Previously, any broker from any part of the world could provide forex trading services to US citizens. 

After numerous scams and scams, the NFA and CFTC have restricted the freedom of retail foreign exchange brokers.

Wait. Some questions you might have

What are the regulatory bodies that control the forex market in the US?

The US Commodity Futures Trading Commission (CFTC) is the primary government regulatory body for the stock market and Forex. Also, the National Futures Association (NFA) is a private organization or watchdog agency that strongly regulates futures trading. The NFA ensures that each of its members meets its regulatory requirements.

Both the CFTC and the NFA protect market investors and the American people from abuse, fraud, price manipulation, and illegal activity related to commodities, futures, Forex, and swaps. 

In short, these agencies help any US resident determine or identify if any broker is trustworthy, legally qualified to offer their brokerage service and be credible.

NFA and CFTC guidelines

Both the NFA and CFTC want Forex brokers to practice ethical business practices to protect the US financial markets. According to the guidelines, brokers must have a working capital of at least $ 20 million. 

This is an increase in working capital requirements as brokers serve more clients. It is mandatory to have customer funds in separate accounts. 

This limits Forex brokers ‘access to traders’ funds. A forex broker will not be able to use traders’ funds to cover their operating expenses.

Also read  What is the best forex broker in the USA?

Brokers cannot interfere with price streams and trading platforms. The NFA imposes huge fines if any broker turns out to be manipulating the market. The NFA requires brokers to have detailed procedures in the event of lawsuits, bankruptcy, or other liquidation processes. Forex brokers must also provide guaranteed customer service to clients.

When a trader makes a withdrawal request, a US regulated forex broker must process the request quickly and is not allowed to withhold payments unless warranted by the federal agency. Traders are also required to comply with deposit requirements under anti-money laundering laws.

To ensure compliance with FX regulations, all Forex brokers must periodically submit audit reports and financial statements to the NFA. This should contain tracking information for all transactions. 

The NFA assumes responsibility for overseeing all activities to ensure compliance with the NFA and CFTC rules.

Highly regulated Forex brokers provide a safer trading environment while protecting trading capital. Any broker who violates the rules will be licensed to suspend or terminate the license.

Can I trade Forex if I live in the USA?

Yes, you can trade Forex if you are a legal resident or citizen of the United States. US residents’ only restriction is to open a Forex account with a broker that is regulated and located in the United States. 

There are no other restrictions on US Forex trading. Indeed, every day billions of dollars enter the market to be exchanged for other currencies or to pay for imported goods and services. The US dollar is the most traded currency. 

The United States Department of Commerce reports that nearly every American citizen uses the Forex market at least once a year. American people can exchange US dollars or any major currency at bank locations, international airports, and foreign currency offices throughout the country. American financial corporations represent more than 55% of the world’s Forex trading.

Moreover, when American people buy from the largest e-commerce retailers purchasing goods overseas, they are indirectly involved in the FX market. The same principle applies to any purchase made overseas and pays for any credit or debit card.

Can US residents become Forex traders?

Of course, US residents can become Forex traders as soon as they are 18 years old in some states and 21 years old in most of them. However, as a minor, US residents can legally deposit money into a personal deposit, and the parent, legal guardian, or probate must place orders on their behalf.

Why So Many Popular Online Forex Brokerage Providers Are Killing US Citizens

Any financial service providers such as banks, retail brokers, mutual funds, and loans must be fully empowered and licensed by government regulators or supervisors to provide their services in the countries they operate. 

Are there any offshore forex brokers that accept American clients?

Also read  Top 5 U.S. forex brokers

Due to the extremely demanding requirements of the United States regulatory agencies, very few foreign exchange brokers either have the cash capital to carry it out or find the US market lucrative enough to go through the process. 

Brokers outside the US cannot accept US customers. Simply put:

Are there any offshore FX brokers that accept US clients? 

Yes. But if you do come across one, be careful. Many of them are most likely scammers. Several Forex sites are claiming to accept US clients, don’t be fooled; they most likely are not eligible to accept US clients, and your money may be in danger, although some may be legal, so it’s best for your research on the broker.

Why the US has tough rules for forex retailers?

The Fx market is largely unregulated. Small regulations and control over Fx retailers and OTC stores have created some legal holes that have been or have been exploited by spammers and scammers to take advantage of investors and traders, rob their money or invested capital, or not pay promised returns on their investments. 

The US government, seeking to maintain the necessary trust and faith in the market, and protect the peoples with money and improve the terms of trade with clear guidelines and rules, approved Dodd-Frank’s financial reform legislation in 2010 following the financial crisis that affected the US economy. 

The legislation aims to improve business practices on Wall Street. Unfortunately, after its approval, hundreds of Fx outlets left the country due to strict rules and regulations. Please note that no restrictions or restrictions are imposed on any US resident on legal Forex trading.

What are the differences between authorized Fx brokers and other Fx Brokers?

After navigating dozens of reputable and reliable Fx brokers, it was impossible to find any real difference in the services offered, the trading platform, or the ordering process. 

Any legitimate and fully compliant online Fx broker must follow strict rules to ensure the safety of users’ money, transparently manage their funds, and place the appropriate orders. 

Most Fx brokers separate users’ money from their own. The best Fx brokers have disclosed the cost and commissions for any order placement or position opening. 

The only differences found are related to their regulations and the restrictions that government agencies impose on them.

The Future of Forex Trading in the USA

The Trump administration is moving forward to deregulate the American market and eliminate Dodd-Frank’s financial reform legislation. 

For this reason, a more accessible environment and relaxation of regulation for retail brokers are possible shortly, opening the door for more foreign exchange brokers to enter the US market and provide their brokerage services to foreigners.

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