CeFi: Foreign Exchange Regulation
Foreign Exchange markets represent the most liquid and voluminous capital markets globally with over $6.5 trillion in assets exchanged daily. While centralized Forex markets are a major hub for global trading activity, they also represent a massive target for regulatory scrutiny.
The foreign exchange market is regulated by over 15 different national supervisory bodies with each regulatory agency focusing on its specific region. Many of the rules imposed by these regulatory agencies overlap and diverge from each other which makes operating as an investor extremely difficult. The result of these divergent laws is the emergence of unlicensed forex brokers in multiple sovereign nations and the inability of licensed brokers to efficiently serve customers’ needs in their country of residence. Unlicensed foreign exchange brokers do not adhere to any jurisdictional laws regarding forex trading and can operate under any conditions they deem fit. This may include the imposition of increased fees, the inability to withdraw funds from the platform, and the possibility of asset seizure should the company choose to shut down or be legally threatened by authorities.
A disgruntled forex trader stated that “Unregulated brokers may offer high leverage or provide an opportunity for traders to participate in the forex market if their nation does not allow it…this should not be the case. People should not have to gamble their money because laws prevent them from trading in the world’s largest market”
CeFi market participants are solely reliant on a third party to execute their trades at agreed-upon prices and due to regulatory headwinds; many individuals are forced to trade with unlicensed brokers or not trade at all. Major nations like China, Japan, and India only allow retail traders to execute forex trades through domestically based brokers. Furthermore, these domestic brokers may have an incentive to keep transaction fees high and prevent the use of leverage in order to maintain their profits. Even in nations that allow investors to trade with their desired forex broker, there is still a high level of dependence on these brokers to execute trades and behave fairly.
DeFi: Censorship Resistant Forex Trading
In blockchain technology, censorship resistance refers to the average DeFi user’s ability to make immutable and trustless transactions on a blockchain without permission from a third party. While CeFi foreign exchange trading is home to a plethora of different regulatory bodies with contradictory rules– DeFi represents a new frontier of completely censorship-resistant forex trading that allows users to be in full control of their funds. The Taebit platform functions autonomously with no third-party controls and no outside regulation that may potentially affect users’ funds. Instead, Taebit puts the power back in the hands of the investor and allows investors from any region across the globe to trade on its platform as long as they have internet access and a Web3 wallet. Users are able to maintain their anonymity, trade with extremely low fees, and avoid regulatory pressure and constraints by accessing the Taebit platform. Not only is Taebit censorship-resistant & trustless, with no third-party risk when trading, but it will also provide a direct bridge to other cryptocurrency platforms that investors can use to access different markets in mere seconds.
Conclusion: A New Frontier for Forex Traders
CeFi Forex markets have tremendous volume across the globe, but they cater to massive corporations and national banks rather than the average retail investor. Taebit represents a completely new way for retail investors to participate in the forex market without making any compromises to legacy centralized brokers. Manage your own funds, experience the fastest transaction speeds and lowest fees in crypto, and access the Taebit platform from anywhere in the world. Taebit puts retail investors first and with your help, we can usher in a new generation of transparent and decentralized financial progress.
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