According to a public warning notice from the Financial Conduct Authority (FCA), British investors have been warned not to take out any financial services with 4XFX as the FX broker operates in the country without its authorization.
4XFX offers investors several trading assets including securities, derivatives, cryptocurrencies, precious metals, and other commodities and shares.
A brief review of the broker’s website reveals that it lists its head-office address in Estonia, and in the ‘Contact Us’ section it makes reference to other global contacts. However, we didn’t find any records of the broker to be regulated by the local Estonian Financial Supervisory Authority or any other regulator.
This is not the first time that 4XFX has sparked regulatory concerns. Earlier in January, Australia’s financial watchdog , which is owned and operated by GRF EUROPE OU, based in Berlin, Germany. Moreover, 4XFX was also blacklisted by Estonian and Spanish regulators.
Prohibiting the sale of crypto derivatives
Earlier in February, the FCA published the findings of independent complementary research which showed that UK consumers buying virtual coins are often looking for ways to ‘get rich quick.’ Many of those interviewed perceived crypto assets as a shortcut to easy money and wealth. The City watchdog has taken its first steps towards regulating cryptocurrencies in January as it began to answer the call for greater oversight of the growing but volatile market.
Specifically, the City regulator launched a on how it should authorize all crypto asset activities from the exchanges on which they trade, to payment companies, wallet providers and the brokers seeking to offer related derivatives.
The FCA is also weighing a potential ban on the sale of derivatives based on cryptocurrencies, in what would be its first major intervention in the nascent market. The aforementioned consultation could lead to , including CFDs, options and futures, based on cryptocurrency prices to retail investors.
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