New CFTC Regulations Breakdown

On August 30th the CFTC (U.S. Commodity Futures Trading Commission), which oversees and regulates futures and spot-forex trading in the United States, released their "final rules" regarding 'off-exchange retail foreign currency transactions;' forex trading as we know it.

You will likely read a lot about the new CFTC forex rules, but unless you are an FCM, Broker, or a money manager (and operate in the US) the new rules probably will not have much of an impact on your life. The new rules state that all persons or entities that are soliciting over the counter retail forex trading must register with the CFTC and NFA as either a futures commission merchants (FCM's), retail foreign exchange dealers (RFED's), introducing brokers (IB's), commodity trading advisors (CTA's), commodity pool operators (CPO's) or associated persons (AP's) of any of the aforementioned groups. Previously only FCMs and FREDs were required to be registered. What this essentially means is that there should be oversight and more accountability for brokers and money managers. More regulation of this nature is a good thing for Forex, which has gained a reputation of being a potentially unsafe industry to be trading in, particularly because it has been moderately regulated at best.