Cyprus Securities and Exchange Commission (CySEC) Brokers 2024
A huge number of online trading brokers are regulated by the Cyprus Securities and Exchange Commission (CySEC). In fact, you will find more regulated forex brokers in Cyprus than any other jurisdiction. However, what precisely is CySEC and which brokers are regulated by them? This tutorial will answer all of the above, while also covering the agency’s history, criticisms and key announcements. We have also listed the top CySEC-regulated brokers.
Best CySEC Brokers
Brokers regulated by the CySEC are required to follow strict measures to protect retail traders. Upon testing, our team have determined that these are the 5 best brokers authorized by the CySEC:
#1 - AvaTrade
Why We Chose AvaTrade
AvaTrade is a leading forex and CFD broker, established in 2006 and regulated across 9 jurisdictions. Over 400,000 users have signed up with the broker which processes over 2 million trades each month. The firm offers multiple trading platforms, including MT4, MT5, and a proprietary WebTrader. 1250+ financial instruments are available for day trading, alongside a comprehensive education center and multilingual customer support.
"AvaTrade offers the full package for short-term traders. There is powerful charting software, reliable execution, transparent fees, and fast account opening with a low minimum deposit."
- DayTrading Review Team
- Instruments: CFDs, Forex, Stocks, Indices, Commodities, ETFs, Bonds, Crypto, Spread Betting
- Regulator: ASIC, CySEC, FSCA, ISA, CBol, FSA, FSRA, BVI, ADGM
- Platforms: WebTrader, AvaTradeGO, AvaOptions, MT4, MT5, AlgoTrader, TradingCentral, DupliTrade
- Minimum Trade: 0.01 Lots
- Leverage: 1:30 (Retail) 1:400 (Pro)
Pros
- Automated trading is supported through MetaTrader Expert Advisors (EAs), as well as the AvaSocial and DupliTrade tools
- WebTrader is well-suited to beginners and features a strong suite of technical analysis tools and market research for day traders
- There's a great range of fee-free deposit methods, including bank wire, credit cards and popular e-wallets like Skrill
Cons
- There is no ECN account with raw spreads
- It’s a shame that there are no rebate schemes for serious traders looking for additional perks - CMC Markets would be a better choice here
- There’s an above-average $50 inactivity fee after three months, though this won't impact active day traders
#2 - Pepperstone
Why We Chose Pepperstone
Established in Australia in 2010, Pepperstone is a top-rated forex and CFD broker with over 400,000 clients worldwide. It offers access to 1,300+ instruments on leading platforms MT4, MT5, cTrader and TradingView, maintaining low, transparent fees. Pepperstone is also regulated by trusted authorities like the FCA, ASIC, and CySEC, ensuring a secure environment for day traders at all levels.
"Pepperstone stands out as a top choice for day trading, offering razor-sharp spreads, ultra-fast execution, and advanced charting platforms for experienced traders. New traders are also welcomed with no minimum deposit, extensive educational resources, and exceptional 24/7 support."
- DayTrading Review Team
- Instruments: CFDs, Forex, Currency Indices, Stocks, Indices, Commodities, ETFs, Crypto, Spread Betting
- Regulator: FCA, ASIC, CySEC, DFSA, CMA, BaFin, SCB
- Platforms: MT4, MT5, cTrader, TradingView, AutoChartist, DupliTrade
- Minimum Deposit: $0
- Minimum Trade: 0.01 Lots
- Leverage: 1:30 (Retail), 1:500 (Pro)
Pros
- Pepperstone emerges as a low-cost broker, especially for serious day traders with spreads from 0.0 in the Razor account and rebates of 25%+ through the Active Trader program.
- There’s support for a range of industry-leading charting platforms including MT4, MT5, TradingView, and cTrader, catering to various short-term trading styles, including algo trading.
- Now offering spread betting through TradingView, Pepperstone provides a seamless, tax-efficient trading experience with advanced analysis tools.
Cons
- Pepperstone’s demo accounts are active for only 30 days, which may not be not long enough to familiarize yourself with the different platforms and test trading strategies.
- Despite enhancements to its range of markets, crypto offerings are relatively limited compared to other brokers such as eToro, with no option to invest in real coins.
- Pepperstone does not support cTrader Copy, a popular copy trading feature built into the excellent cTrader platform and available at alternatives like IC Markets.
#3 - XM
Why We Chose XM
XM is a globally recognized forex and CFD broker with 10+ million clients in 190+ countries. Since 2009, this trusted broker has been known for its low fees on 1000+ instruments. XM is regulated by multiple financial bodies, including the ASIC and CySEC.
"XM is one of the best forex and CFD brokers we have tested. The flexible account types will suit a variety of short-term trading styles while the $5 minimum deposit and smooth sign-up process make it easy to start trading."
- DayTrading Review Team
- Instruments: Forex, Stock CFDs, Turbo Stocks, Indices, Commodities, Precious Metals, Energies, Shares, Crypto, Futures
- Regulator: ASIC, CySEC, DFSA, FSC, FSCA
- Platforms: MT4, MT5
- Minimum Deposit: $5
- Minimum Trade: 0.01 Lots
Pros
- XM is a hugely respected broker authorized by tier-one regulators
- Transparent and low fees with spreads from 0.0 pips that will help protect day trading profit margins
- XM continues to deliver diverse and multilingual educational materials and offers a useful live education schedule for its webinars and insights
Cons
- PayPal deposits are not supported
- There's $5 inactivity fee after only 3 months, though this won't affect active traders
- There is weak regulatory oversight through the global entity
#4 - IC Markets
Why We Chose IC Markets
IC Markets is a globally recognized forex and CFD broker known for its excellent pricing, comprehensive range of trading instruments, and premium trading technology. Founded in 2007 and headquartered in Australia, the brokerage is regulated by the ASIC, CySEC and FSA, and has attracted more than 180,000 clients from over 200 countries.
"IC Markets offers superior pricing, exceptionally fast execution and seamless deposits. The introduction of advanced charting platforms, notably TradingView, and the Raw Trader Plus account, ensures it remains a top choice for intermediate to advanced day traders."
- DayTrading Review Team
- Instruments: CFDs, Forex, Stocks, Indices, Commodities, Bonds, Futures, Crypto
- Regulator: ASIC, CySEC, FSA
- Platforms: MT4, MT5, cTrader, TradingView, TradingCentral, DupliTrade
- Minimum Deposit: $200
- Minimum Trade: 0.01 Lots
- Leverage: 1:30 (ASIC & CySEC), 1:500 (FSA), 1:1000 (Global)
Pros
- With ultra-fast execution speeds averaging 35 milliseconds and deep liquidity, IC Markets provides an optimal trading environment for scalpers, hedgers, and algorithmic traders.
- IC Markets offers among the tightest spreads in the industry, with 0.0-pip spreads on major currency pairs, making it especially cost-effective for day traders.
- IC Markets offers fast and dependable 24/5 support based on firsthand experience, particularly when it comes to accounts and funding issues.
Cons
- There are fees for certain withdrawal methods, including a $20 wire charge, which can eat into profits, especially for frequent withdrawals.
- Interest isn't paid on unused cash, an increasingly popular feature found at alternatives like Interactive Brokers.
- The breadth and depth of tutorials, webinars and educational resources still need work, trailing alternatives like CMC Markets and reducing its suitability for beginners.
#5 - LiteForex Europe
Why We Chose LiteForex Europe
LiteForex Europe is a CFD broker established in 2008 and authorized by the CySEC. The brokerage offers forex, commodities and indices via the MT4 and MT5 platforms. Spreads are ultra tight on ECN accounts and leverage is available up to 1:30 in line with EU regulations. LiteForex also offers a rich education centre for new day traders and social trading capabilities.
"LiteForex is a good option for active day traders with variable spreads from 0.0 pips, daily analysis and high-quality training guides. The forex copy system also lets you duplicate the positions of experienced traders."
- DayTrading Review Team
- Instruments: CFDs, Forex, Indices, Commodities
- Regulator: CySEC
- Platforms: MT4, MT5
- Minimum Deposit: $50
- Minimum Trade: 0.01 Lots
- Leverage: 1:30
Pros
- Fast ECN execution model with low spreads from 0.0 pips
- LiteForex offers a client-oriented approach, with personal manager assigned to each trader and 24/5 multilingual customer support
- Low $50 minimum deposit makes LiteForex accessible for beginners
Cons
- Fees are fairly high, with spreads starting from 2.0 pips in the Classic account and $10 forex commissions in the ECN account
- The range of day trading markets is limited compared to alternatives, with no share CFDs offered
- There is no swap-free trading account for Muslim day traders
What is CySEC?
CySEC is the financial regulatory agency of Cyprus. When Cyprus became an EU member state in 2004, all regulations, processes and operations of CySEC had to comply with the European MiFID financial harmonisation law.
Purpose & Responsibilities
As the official website details, CySEC’s main aims and responsibilities are as follows:
- Effective monitoring and supervision of the local stock exchange and related companies and brokers.
- To distribute licenses allowing for investment and brokerage firms to operate in the stock, forex and CFD market.
- Effectively collating all necessary information on regulated forex companies and other brokers lists.
- To understand the meaning and advanced trading benefits of new products, such as the cryptocurrency Bitcoin and other virtual currencies.
- To accurately review and amend when necessary new forex regulations, license certificates and investment advice.
- Undertaking training to tackle money laundering and other threats to regulatory systems.
- To inspect the list of regulated brokers and companies, including checking they are meeting reporting requirements and operating a fair remuneration policy.
- To ask questions and impose sanctions on any registered companies that breach regulations.
History
CySEC is a public corporate body that sprung to life in 2001 from the Cyprus Securities and Exchange Commission Law of 2001. As a result of Cyprus becoming one of the EU members, all registered brokers and licensed companies were given access to European markets.
However, the EU registration and transition weren’t without problems. The move had a significant impact on the tax haven regulatory framework that CySEC has previously adopted.
By the time May 4th, 2012 had rolled around, the board made an announcement that it was changing the classification of binary options so they counted as financial instruments. All platforms operating in Cyprus had to adhere to the new binary options regulations in 30 days. These new rules included providing consumers with clear information about products and a requirement to “operate in a way that is fair to clients”.
This was a significant move for two reasons. Firstly, the majority of platforms are found in Cyprus. Secondly, CySEC became the first regulatory body to recognise and regulate binary options as financial instruments.
Structure
A board consisting of five members, including two full-time employees, a chairman and vice-chairman run CySEC. On top of that, a non-voting board member represents the Central Bank of Cyprus.
CySEC also has links to the government. The Council of Ministers decides on the board of directors after receiving proposals from the Minister of Finance.
Regulation & Processing
Regulation
When you take CySEC vs FCA or CFTC you realise the former is constantly having to adjust regulations to try and keep up with significant growth rates and more reputable regulatory agencies.
In fact, during 2014-2015, CySEC was under attack in the news from traders and industry commentators who thought more stringent regulations were necessary to monitor high-risk investment firms. In particular, there was an argument fines for binary options brokers were too low.
Processing
Because they were the first to regulate binary options, a huge number of brokers hold CySEC licenses so they can operate within the Eurozone. However, many believe verification and processing times could be much quicker.
It’s also worth noting many brokerage websites claim “Binary Options are the simplest way to trade the market. They have been available since 2008, and became regulated in Europe by CySEC in May 2012”. However, this does not necessarily mean that a particular broker is regulated by CySEC. So traders should search for the 5 Digit CySEC License Number and then verify the license on the CySEC website.
Broker Guidelines
CySEC has distributed guidelines and regulations on a whole range of trading activities. This includes bonus circulars, new guidelines for cryptocurrencies, such as bitcoin and directives for money laundering.
But with so many regulations, let’s touch on a couple of important examples that a regulated forex company must adhere to:
- A minimum of two people must be in charge of the administration of an investment firm, while also in the appropriate register.
- Brokers with licenses must notify CySEC before extending their services. Therefore, it is in the best interest of forex brokers to detail all the investment services it plans to offer at the outset.
In addition to the above, CySEC can also set minimum capital requirements, bonus qualifications and leverage limits. Furthermore, brokers must meet regulations around indemnity insurance and ensure access to investor compensation funds.
Note if a broker fails to meet license requirements, their offices can swiftly receive notifications of fines or even the removal of their license.
Criticisms
Those with contacts in the industry or follow relevant news announcements will have seen there are certain criticisms of CySEC. These include:
- As a result of hazy definitions and inaction, a number of licensed brokers and investment services have escaped infringements with minor warnings.
- Despite having the law to fall back on, CySEC compliance officers hand out relatively small non-compliance fines.
- When there is a potential break of regulations, CySEC is too slow to respond. For example, an investigation into IronFX only began after considerable consumer complaints and media attention.
- There is a distinct lack of direct communication for individuals searching to make a complaint. Unfortunately, unlike the NFA, any complaints have to be made directly to your broker. This puts you at risk of late and inadequate responses. The only other alternative is going to a financial ombudsman, which can also mean extensive waiting times. CySEC’s unwillingness to resolve direct complaints attracts criticism from a range of other regulatory bodies.
CySEC Responses
It’s worth noting CySEC have taken action to address some of these issues. In fact, they have pursued greater transparency around listed brokers and tougher fines. Furthermore, they have taken more action to suspend and revoke licenses.
In addition, a 2016 circular said: “the name of the regulated entities, or the use of words within their name, should reflect the work/activities they are engaged in, for purposes of not misleading the investors”. Also, to tackle consumer complaints, they have brought in a new structure.
It’s also worth pointing out that despite criticism, CySEC can be in pro-active. For example, new legislation in France was brought in to prevent digital advertising of high-risk investment products. CySEC were then quick to bring out a circular informing companies they would need to adhere to these new regulations when advertising to French clients.
Final Thoughts
CySEC still has much to do to be as reputable as the FCA in the UK and the CFTC in the USA. However, they remain a popular body and continue to grow as a result of low barriers to entry and less stringent regulations.
Remember before you sign up with a brokerage, always check the firm is one of the approved brokers using their registration number and the official CySEC website.