Forex trading, also known as currency exchange of FX trading, is one of the most popular and active markets around the world. However, when it comes to the United States the rules of the game are rather different.
While Forex trading is still possible for American citizens, there is just a small group of brokers that can operate in the Forex trading market.
The reason? The license the government expects brokers to have in order to trade and exchange currencies is rather difficult to get since it requires them to have at least 20 million dollars, plus the fees and legal rates related to obtaining the license.
These restrictions, plus several penalties, mean that the government controls closely the Forex trading.
Is Forex trading legal in the US?
The answer is yes. However, it may not be as easy as in other countries. The restrictions and government controls mean that only a selected few brokers can offer Forex trading to their clients.
A popular myth spread among beginner traders is that Forex trading is forbidden in the US. This, as we have mentioned, is not true.
It’s important to note that American citizens cannot choose a foreign broker to trade and exchange currencies.
The US regulations, managed by the NFA (which stands for National Futures Association), require brokers to be registered with such an entity to be able to trade in the Forex trading marketplace.
The NFA is there to guarantee the transparency and integrity of all operations, as well as making sure that the brokers comply with the regulatory measures, therefore protecting all those involved in the market operations.
While this may sound quite strict, it was a system put in place to ensure the safety of all dealings in the Forex trading market.
What Forex brokers are authorized in the United States?
There are, as we mentioned, a few brokers that operate in the Forex trading market. Among the most popular and well-respected we have FOREX.com, OANDA, ATC BROKERS, Interactive Brokers, and Ally Invest. There are more US brokers that can trade in Forex, but these ones are the best ones based on the features they offer, the quality of their platforms, and general safety measures.
In order to choose the best Forex broker for you, we recommend checking out the best review about US forex brokers.
Forex.com is a well-known trading platform with a respected reputation in the US. It offers several interesting features useful to beginners and more advanced Forex traders, plus the benefit of being completely online with live information that allows traders to operate in the Forex trading market anywhere and anytime.
OANDA is also very popular among Forex traders in the US. It offers very interesting currency trading tools, as well as a free demo that can be a perfect introduction to the Forex trading world for those just getting started.
This Forex trading platform also offers benefits to big currency exchange operations.
ATC Brokers is famous for offering excellent services, among which is worth mentioning their customer service, which works either by phone, email, or online chat.
Interactive Brokers is another popular choice thanks to their low fees and high technological trading platform. It also has a global presence, offering access to their trader to more than 23 different currencies in 31 countries.
Finally, Ally Invest is well-known for having excellent resources and educational materials that beginners in the world of Forex trading will find useful. It also offers a set of trading tools that even allow for testing operations to be done in order to understand how the Forex market works.