The Week’s Snapshot: Donald Trump's Victory and Crypto, ASIC to Close 95 Firms, and More

Trump Victory Ushers In First Bitcoin-Friendly Administration

In a major development on the world stage this week, Donald Trump won the election, sweeping the Electoral College and the popular vote. There are a huge number of takeaways from this emphatic resolution to a dramatic and unorthodox presidential race, but let’s focus on Bitcoin and blockchains and consider the implications for the crypto industry from this point on.

From the top, it’s important to note that there has never previously been a presidential campaign that featured crypto as prominently as that just run by Donald Trump. His push for the presidency received advice and backing from David Bailey, the CEO of Bitcoin Magazine. The campaign accepted donations in crypto, and in July, Trump was the headline speaker at the Bitcoin 2024 Conference in Nashville.

Government Efficiency 🙌 https://t.co/zMtNsVU4Tm

— Elon Musk (@elonmusk) November 8, 2024

Markets Cheer, Rich Get Richer

Trump's election rally boosted markets, enriched billionaires, and sent crypto soaring, revealing his larger-than-life impact on the economy. Wall Street must have cracked open the champagne early. With Trump gearing up for his latest turn in the White House, investors seem to have found a newfound zest, breathing life into a market rally that even the most optimistic brokers probably didn’t pencil in.

The Dow closed 1,500 points higher on Wednesday following Trump’s win. It’s as if the mere thought of Trump in the White House again has money people digging out their "Make Wall Street Great Again" hats. According to a report, as U.S. Treasury yields climbed, so did investor sentiment, triggering a market rally that defied traditional expectations.

Capital.com Gains from Index Trading Demand

Client trading volume on Capital.com skyrocketed to over $450 billion in Q3 2024, which is 20 percent higher than the previous quarter. The volume was $337 billion in Q1, meaning the nine-month trading volume on the platform surpassed last year’s total of $1.2 trillion. The increased trading demand last quarter was driven by strong interest in indices, commodities, and FX markets, the brokerage firm revealed. It further added that index trading accounted for about 53 percent of its total quarterly trading volume.

“With anticipation for the US presidential elections building in Q3, we've seen increased interest in indices and FX pairs, specifically those involving the dollar,” said Daniela Sabin Hathorn, Senior Market Analyst, Capital.com. “The capital injection by China to revive its struggling economy was also a key driver of the momentum in equities throughout September as traders set aside concerns about growth in China.”

easyMarkets Registers Strong Q3 Results

easyMarkets posted strong trading volumes for some of its key financial instruments in the third quarter. Among the standout performers were the USDJPY currency pair and NASDAQ's tech-heavy index. According to the forex trading broker, both indices posted a significant boost as the global market shifted, sparking strong demand from traders.

Notably, easyMarkets highlighted the surge in trading volume for the USDJPY currency pair in Q3, with an impressive 98% increase compared to the previous quarter. This jump was reportedly driven by increased client interest in Yen pairs, particularly following the Bank of Japan's decision to raise interest rates for the first time in 17 years.

55% of Gen Z Discuss Investments with Friends

A recent survey from eToro shows that Gen Z investors are far more likely than older groups to discuss investments with friends and family. The study, covering 10,000 retail investors across 12 countries, found that 55 percent of Gen Z respondents aged 18 to 27 spoke about their portfolios with friends, and 44 percent shared their investment activities with relatives.

Among baby boomers aged 60 to 78, only 29 percent had such discussions with friends, and 22 percent with family. This trend extends beyond family circles. Gen Z respondents are more likely than boomers to compare investment strategies with strangers, at 10 percent compared to 4 percent, and colleagues, at 32 percent compared to 15 percent.

INFINOX Capital Reports Revenue Drop in 2024

INFINOX Capital Limited released its financial results for the fiscal year ending March 31, 2024, reporting a marked improvement in profitability despite a sharp decline in revenue. For the year, the company reported a total turnover of £3.69 million, a drop from £14.63 million in 2023.

While the decrease in revenue highlights a challenging year, the company’s efforts on cost control and operational efficiency have contributed to a recovery in its financial position.

BP Prime’s Professional Clients Push FY24 Revenue 7x

Black Pearl Securities Limited, which operates as BP Prime, reported a turnover of more than £16 million for the fiscal year ending 31 March 2024, compared to the previous fiscal’s £2.3 million—a 595 percent increase.

In its latest Companies House filing, the FCA-regulated company highlighted that its “institutional product offering to regulated entities and professional clients has been predominantly responsible for driving income.” It also noted that demand for retail products on its platform declined, particularly in account applications, which led to a reduction in profit contribution.

APM Capital Markets’ Revenue and Profit Decline Ahead of Acquisition

APM Capital Markets, formerly known as BUX Financial Services, released a strategic report accompanied by a financial report for the fiscal year ended, 2023. The company reported declining revenue and profit, citing restricting plans amid the decision to sell the company and other EU-based CFD businesses.

Revenue declined to £843,938 from 1,523,424 during the same period of 2022, and losses widened to £2,993,957 from £2,259,242 in the same period last year. According to the firm, there was a limited focus on growing the business during this period and a shift to maintaining core operations and regulatory requirements. This also affected the client base.

Plus500 Is Highly Efficient in Profitability

When it comes to profitability, the three London-listed retail brokers generally perform well (with only a few exceptions). While IG Group and Plus500 regularly lead in pre-tax profitability with three-digit gains, CMC Markets often has lower figures. IG, with a market cap of £3.2 billion, is the largest of the three forex and contracts for difference brokers.

It achieved a pre-tax profit of £224.4 million on revenue of £514.7 million in the six months between December 2023 and May 2024, resulting in a profit-to-revenue ratio of 43.6 percent. During IG’s best-performing fiscal six months in the last five years, the first half of FY 2022, the broker achieved a pre-tax profit of £245.2 million, resulting in a profit-to-revenue ratio of over 51.6 percent.

Unregulated FX Brokers Offer High Leverage and Low Fees

Unregulated trading venues will never disappear as long as there are traders willing to swap consumer protections for high leverage and lower fees. The challenge for regulated platforms with significant compliance costs is to convince these traders that the risks outweigh the perceived advantages.

In September, the Foreign Exchange Professionals Association (FXPA) published a white paper on trading venues operating in OTC FX derivatives markets. It cautioned that the benefits of trading on unregulated FX derivatives venues may come at the expense of reduced customer protections.

Boxing Legend Mike Tyson Becomes NAGA Group’s Brand Ambassador

Elsewhere, NAGA Group AG appointed boxing legend Mike Tyson as its brand ambassador, marking another entry of a sports personality into the retail trading industry, Finance Magnates has learned. The partnership was officially announced by NAGA’s CEO, Octavian Pătrașcu, who posted about Tyson joining as a brand ambassador.

The partnership was officially announced by NAGA’s CEO, Octavian Pătrașcu, who posted about Tyson joining as brand ambassador. Describing “this latest project with Mike Tyson as next-level,” the CEO further revealed that his team managed to negotiate and sign contracts with Tyson, coordinate with production teams in Los Angeles and New York, and build the entire campaign content in just two weeks.

Taurex to Launch Proprietary Trading Platform Atmos

The list of FX and CFD brokers looking to capitalize on the recent popularity of retail proprietary trading continues to grow. Taurex is the latest to join this dominant industry trend with the launch of its own prop platform, Atmos.

Finance Magnates learned that Taurex is preparing to launch its own prop trading brand. The website atmos.tradetaurex.com is already live and is currently testing ahead of its official platform launch. Users can currently register by providing their name and email address to receive detailed information when the official launch takes place.

“Consob’s Attention Is Very High,” Says Fintokei’s Italy Manager

Prop trading brand Fintokei recently expanded its operations into Italy, with its newly appointed Country Manager aiming to acquire 3,000 clients by the end of 2025. According to Marco Martire, the timing for entering one of Europe's key markets couldn't be better, especially as the local regulator increasingly scrutinizes the sector.

Martire shared a social media post addressing the recent Italian debut of Fintokei, a platform with Czech and Japanese roots. This expansion is part of a broader growth strategy by the brand, co-owned by David Varga, who also represents Purple Trading brokerage.

Indian Regulator Calls Prop Trading Platforms “Unauthorised”

The Indian regulator overseeing the local securities markets issued an advisory against “apps/web applications/platforms” offering “virtual trading services, paper trading, or fantasy games to the public based on stock price data of listed companies.” Although the agency did not specifically name “prop trading” or funded trading platforms, it clearly indicates such platforms.

Indian Regulator Calls Prop Trading Platforms “Unauthorised”https://t.co/z1LZWUBlnq

— John Morgan (@johnmorganFL) November 7, 2024

Interestingly, the Indian central bank recently updated its warning list, which contains a long list of contracts for differences (CFDs) brokers, adding the names of a couple of prop trading platforms. While the Reserve Bank of India controls all forex brokers, SEBI regulates the securities market.

ASIC to Wind Up 95 Financial Services Firms

Lastly, the Australian Securities and Investments Commission (ASIC) has moved to court to wind up 95 local financial services companies, some of which offered forex and contracts for differences (CFDs) trading services. The industry-specific names include Aximtrade, Vortex Trading, Ridder Trader, and a few others.

Notably, none of these companies now offer trading services under the Australian Financial Services (AFS) license. In fact, most shuttered firms have entirely closed. The exceptions include Aximtrader, which still offers services outside Australia under a Saint Vincent and the Grenadines license.

Happy weekend!