"Prop Trading Will Fall under Robust Regulation at Some Point", CySEC Chair

To start our news roundup, Dr. Theocharides clarified during the iFX Expo International in Cyprus that although "prop trading is getting the attention of regulators and there are some preliminary discussions among regulators, at the moment, these discussions are at an early stage." Regarding the desired framework, the CySEC Chair mentioned that "it's not the time to estimate whether it's (prop trading) going to be under MiFID or something else."

Regarding the other important regulatory framework, Markets in Crypto Assets (MiCA), crypto service providers could passport their services across the European bloc, a provision that has changed the landscape for MiFID-regulated firms. However, Dr. Theocharides maintains that because of such passport privileges, "there will be a lot of scrutiny across Europe, from all the NCAs, and from ESMA, for any firm that wants to get a license under MiCA."

"The UK Might Be the First to Bring Prop Trading Regulations": Muinmos' CEO

Still, at the sidelines of the iFX Expo, Remonda Kirketerp-Møller, the Founder and CEO of Muinmos, told Finance Magnates: "A number of experts may say that the US might be the first to introduce prop trading regulations, but it might be the UK as well. There are definitely proprietary trading firms operating out of their jurisdictions. Some are legitimate, but unfortunately, some are bypassing regulations and operating under a separate non-regulatory umbrella."

Highlighting the necessity of regulating the prop trading industry, Kirketerp-Møller noted the issues with payout denials by many prop trading platforms. She said: "There is no doubt that regulators have started to see these issues," and such situations result in "new regulatory frameworks."

The European Securities and Markets Authority (ESMA) released new guidelines under #MiCA, designed to create a more transparent environment for retail investors in the crypto space.

Here’s a TL;DR 👇🧵 pic.twitter.com/JDOpIFHHHq

— European Crypto Initiative (@EuCInitiative) July 12, 2024

Prop Trading Firm Funded Engineer Shuts Down

In breaking news this week, prop firm Funded Engineer announced the "permanent closure" of its operations, effective immediately, and the decision to file for bankruptcy on its official social media channels. The company's website displayed a notice of the "announcement of ceasing operations," saying it no longer offers clients the option to access their accounts.

Further, the announcement stated: "Despite our extensive efforts to improve our financial situation, we have been unable to overcome the challenges we faced, necessitating the cessation of all operations effective immediately." The company unsuccessfully tried restructuring, cost-cutting measures, and seeking additional investment.

Prop Trading Firm The Trader Forge Pauses Operations over "Compliance Challenges"

Still, with the volatile prop trading space, The Trader Forge announced a temporary pause in all operations this week, blaming unforeseen circumstances. This decision affected all aspects of the business, reportedly disappointing clients and stakeholders. In a message from the CEO, the firm acknowledged the frustration this may cause.

According to the firm's statement, compliance and regulatory issues are significant factors contributing to these delays. The Trader Forge aims to resume operations on August 1, and all accounts and account types will reportedly be included in this restart. The firm has promised the resumption of services regardless of the client's location.

.@TheTraderForge temporarily pauses its operations.

Your thoughts!? 👇 pic.twitter.com/q8VVWRRADv

— TheTrustedProp (@TheTrustedProp) July 17, 2024

OANDA's Prop Trading Platform Allows Buying Challenges with Crypto

OANDA’s prop trading arm, OANDA Prop Trader, enhanced its service by enabling traders to pay for its challenges with cryptocurrencies. The platform now supports payment with about two dozen cryptocurrencies, including stablecoins. The newly supported payment mode includes top cryptocurrencies and stablecoins like Bitcoin, Ethereum, Litecoin, Binance Coin, TUSD, USDC, and USDT.

Additionally, traders can pay for their challenges using meme coins like DOGE and SHIB. OANDA entered the prop trading business early this year. Although initially launching the services under the brand OANDA Labs Trader, it quietly changed the branding to OANDA Prop Trader to better resonate with the proffered services.

OANDA Is Up for Sale: Report

At the same time, OANDA was put up for sale by its owner, CVC Capital Partners, an Amsterdam-listed buyout firm, Sky News reported. Although there is no official update yet, the retail broker is being marketed by the bankers at Nomura and Santander. The terms and financials of the deal remain undisclosed at this stage.

OANDA is a major retail brokerage brand offering trading services in foreign exchange, equities, commodities, and cryptocurrencies. It has a presence in the United Kingdom, the United States, and Japan, among several other countries. The company is also one of the few licensed brokerages that offer retail margin forex trading in the US.

BUX Sold Its CFDs-Offering UK Entity in a "Divestment Process"

BUX Financial Services, the UK unit of Netherlands-based BUX, was sold to Asseta Holding, the parent company of UAE-based investment firm APM Capital. The acquisition came after ABN AMRO completed the acquisition of BUX’s Netherlands operations, which is operating as a neo-broker.

A New Owner for BUX UK Regulated by the Financial Conduct Authority, the UK unit of BUX offers contracts for difference (CFD) and financial spread betting services to retail and professional clients under the brand BUX Markets. The acquisition did not come as a surprise, as BUX had already revealed its plans to sell the business last year. APM Capital also offers CFD trading services.

TrivePro (Formerly GKPro) Applies for FCA Licence Cancellation

Trive Financial Services UK Limited, which operates as TrivePro, applied to the United Kingdom’s Financial Conduct Authority (FCA) to cancel its license. According to the FCA register, the company applied for the license cancellation on 14 June 2024.

"This firm has applied to cancel its authorization but must still meet our standards in dealing with its customers," the regulator stated on its registry page. TrivePro was authorized to operate in the country on 15 February 2010. The application to cancel the FCA license indicates the company’s plans to exit the UK markets.

FCA Removes Restrictions from FlowBank-Owned LCG's UK Licence

The UK's Financial Conduct Authority (FCA) lifted all restrictions on the license of London Capital Group Ltd (LCG), retail forex, and contracts for differences (CFDs) broker owned by the now-bankrupt FlowBank. The restrictions were imposed on 13 June following FlowBank's bankruptcy.

The FCA’s previous actions against LCG included restrictions on onboarding new clients or introducing any new client under its introducing broker business. Additionally, the regulator also imposed asset restrictions on the company, prohibiting it from disposing of or diminishing any of its own assets or customer funds, whether in the UK or outside.

The UK Faces Potential "Crypto Catastrophe" Due to Staff Shortages at FCA

The Financial Conduct Authority (FCA) significantly expanded its cryptocurrency workforce to over 100 staff members, yet its policy team remains understaffed, according to data obtained by blockchain finance provider Quant through a Freedom of Information request. The regulator claims that it is doing everything in its power to support the cryptocurrency industry, with members of the other FCA teams also working on the approach to digital assets.

The FCA now employs 109 staff dedicated to crypto assets, a huge increase from just 9 in 2019. However, only 18 of these employees work in the policy department, responsible for drafting and implementing market regulations. Adding nine representatives from the wholesale policy department, the total increases to 27, accounting for about 25% of the overall employment.

Darwinex to End CFDs for Retail Clients in Spain, Cites Stringent Regulations

Darwinex will cease offering Contracts for Difference (CFDs) to new retail clients and residents in Spain on July 31, 2024, due to what the company attributed to stringent regulatory measures imposed by the regulators.

In a statement this week, the company cited Comisión Nacional del Mercado de Valores' (CNMV) resolution on CFDs, which was announced in July last year. This resolution mandates significant changes in how financial products are offered to retail clients in Spain.

ATFX Connect Doubles Its 2023 Revenue, Profit Jumps

AT Global Markets (UK) Limited, which operates the ATFX Connect brand, closed the year 2023 with an annual turnover of more than £6.18 million, an increase of 95.8% from the previous year’s £3.16 million. Profits also echoed this growth, as the net income came in at £1.38 million, a jump of 64.8% from £838,189 in 2022.

According to the company's latest Companies House filing, its sales and administrative costs also increased with the rise in revenue. The sales cost for the year 2023 came in at £1.9 million, higher by 119.2% year-over-year, while the administrative cost also jumped to £2.86 million from the previous year’s £1.47 million, an increase of 94.5%.

Equiti Capital UK Reports 30% Drop in Income despite Revenue Gains

Equiti Capital UK Limited, the FCA-regulated arm of Equiti Group, increased its trading revenue and operating profit in 2023. However, the total comprehensive income turned out to be over 30% lower than the previous year.

According to the latest report from the British branch of Equiti Group, trading revenue in 2023 exceeded $31 million, growing by several percentage points from the $30.5 million reported the previous year. This allowed the company to achieve an operational profit of $1.9 million, which increased marginally compared to the results reported in 2022.

Interactive Brokers' Q2 Results Soar, Earnings per Share Jumps 37%

Interactive Brokers posted impressive financial results for the second quarter of 2024, highlighting growth in earnings and revenues. For the quarter ended June 30, 2024, the brokerage giant reported a diluted earnings per share (EPS) of $1.65, a 37% increase compared to $1.20 in the same period last year.

On an adjusted basis, the EPS was $1.76, up 33% YoY from $1.32. The company reported net revenue of $1,230 million (23% YoY increase), with adjusted net revenues reaching $1,290 million (21% YoY increase), compared to the previous year's $1,000 million and $1,064 million, respectively.

SEC Grants Preliminary Approval to Ether ETFs: 3 Firms Eye Tuesday Debut

The United States Securities and Exchange Commission (SEC) gave "preliminary approval" to at least three asset managers for their spot Ether exchange-traded funds (ETFs). This development has increased speculation that the ETFs will begin trading as early as next Tuesday.

According to a report by Reuters, the SEC approval is now only contingent on the applicants submitting final offering documents to the regulator before the end of this week. The report cited three industry sources.

⚡️ @SECGov tells $ETH ETF issuers that the funds can begin trading around July 23rd

Ethereum exchange traded-funds issuers were reportedly told by the SEC that funds could start trading on July 23rd. According to one of the issuers, SEC officials stated that the regulator had… pic.twitter.com/vv07U8CW93

— 🇺🇦 CryptoDep #StandWithUkraine 🇺🇦 (@Crypto_Dep) July 16, 2024

"MiCA's Short-Term Negative Impacts Can Lead to Greater Crypto Adoption": B2C2's CEO

Thomas Restout, the CEO of B2C2, talked to Finance Magnates about the MiCA regulations, saying: "(The regulation) will empower my company. From our side, MiCA is a great benefit." Although B2C2 is a cryptocurrency liquidity provider, it falls under the MiCA’s purview to distribute digital assets across Europe.

He added: "MiCA will define the rules of the game. Once the rules are defined, many more players can come in… If there are regulations, you know what the standards are, and you have a clarification on the products. It will continue to raise the product and, certainly, what can and cannot be distributed. As ETF opened the crypto world to new participants, MiCA will also open the crypto world to new participants."

The Assassination Attempt on Donald Trump is Shaking Up Crypto

And in the news that shocked the globe early this week, Donald Trump's near-assassination and newfound crypto influence significantly increased his net worth, making him a major player in the digital currency market. As you’ll no doubt know, former President Donald Trump narrowly escaped an assassination attempt on July 13. Putting aside the conversations on violence, extremism, and politics for a second, the attempt had unexpected repercussions on the financial markets, particularly the crypto sector.

As Trump was bundled off stage, his influence in the crypto world surged, leading experts to speculate on the potential impacts of his renewed vigor in promoting digital currencies. Why all the fuss? Because many analysts believe that the shooting has boosted his chances of election. Voters love a defiant figure, and Trump’s raised fist was a winner.

#Crypto market as soon as Trump wins: pic.twitter.com/cOwflxVIUv

— Evan Luthra (@EvanLuthra) July 12, 2024

J.D. Vance: Trump’s VP Pick is Pro-Crypto

Lastly, in a political landscape increasingly intrigued by digital currencies, J.D. Vance, the Republican Senator from Ohio who Donald Trump picked as his potential VP, has positioned himself as a unique player. Known for his populist stances and critical views on Wall Street, potential VP James David Vance is making waves with his Bitcoin holdings, adding a new layer to his already complex political persona.

Alongside Trump’s own position on crypto and his personal holdings, the choice of Vance as VP is sending a clear pro-crypto message to American voters. Vance’s Bitcoin investments were revealed as part of a broader financial disclosure. This move aligns him with a growing number of politicians who are diving into the crypto market, reflecting a shift in how lawmakers engage with emerging financial technologies.

Until next week!