European Regulator Renews Restrictions on Crypto-Based Derivatives

European Regulator Renews Restrictions on Crypto-Based Derivatives

Europe’s securities watchdog, ESMA, has decided to extend the restrictions applied to a number of financial derivatives, including contracts-for-differences (CFDs) based on cryptocurrencies. The limits that were introduced in August of this year will now remain in place until the end of January 2019.  

Also read: French Regulator Blacklists More Fraudulent Crypto Businesses

ESMA Concerned About CFDs Offered to Retail Clients

The European Securities and Markets Authority (ESMA) has taken steps to renew the restrictive measures imposed on the marketing, distribution, and sale of contracts-for-differences (CFDs) to retail customers. The restrictions were enforced on August 1 and according to the regulator’s latest decision, will be extended for another three-month period, starting from November 1.

In a press release, ESMA says it has “carefully considered the need to extend the intervention measure currently in effect.” The Paris-headquartered agency believes that “a significant investor protection concern related to the offer of CFDs to retail clients continues to exist.” That’s why a renewal of the limitations has been agreed by its Board of Supervisors on Wednesday, September 26, the regulatory body said in the announcement posted on its website this Friday.

The restrictions include the obligation to maintain leverage limits on the opening of a position by a retail client. These vary depending on the volatility of the underlying assets: 30:1 for major currency pairs; 20:1 for non-major currency pairs, gold, and major indices; 10:1 for commodities other than gold and non-major equity indices, and 5:1 for individual equities and other reference values. For cryptocurrency-based products, the leverage is limited at 2:1. These restrictions will be valid until January of next year.

European Regulator Renews Restrictions on Crypto-Based Derivatives

Other Applicable Limits Remain in Place

ESMA’s decision to limit the leverage offered on cryptocurrency CFDs to no more than 2:1 was agreed in March of this year, as news.Bitcoin.com reported. In its announcement back then, the EU institution referred to the restrictions as “temporary product intervention measures on the provision of CFDs and binary options to retail investors.” The ratio means that traders are obliged to provide an initial margin of “50% of the notional value of the CFD when the underlying asset is a cryptocurrency, which is more than the initial margin required of any other CFD.

The authority motivated its ruling with the relatively immature status of the asset class which, in its opinion, poses a major risk for investors. ESMA was worried about the integrity of the price formation process in the underlying cryptocurrency markets which “makes it inherently difficult for retail clients to value these products.” The regulatory body stated that financial instruments providing exposure to cryptocurrencies, CFDs in the case, needed to be closely monitored. It also promised to assess if stricter measures were required.

European Regulator Renews Restrictions on Crypto-Based Derivatives

In its latest decision on the matter, the agency confirms the renewal of other relevant restrictions, including a negative balance protection on a per account basis, a measure providing a guaranteed limit on retail client losses. Other safety mechanisms that have been confirmed envisage the preserving of restrictions on the incentives offered to trade CFDs as well as the issuing of a standardized risk warning that is supposed to include the percentage of losses on a CFD provider’s retail investor accounts.

In its press release, ESMA notes that the renewed measures have to be published in the official languages of the EU and also in the Official Journal of the Union before they begin to apply on November 1, 2018.

What is your opinion on the EU restrictions imposed on crypto-based CFDs? Share your thoughts on the subject in the comments section below.


Images courtesy of Shutterstock, ESMA.


Need to calculate your holdings? Check our tools section.

The post European Regulator Renews Restrictions on Crypto-Based Derivatives appeared first on Bitcoin News.

World’s Second Largest Search Engine Bans Crypto Ads

World’s Second Largest Search Engine Bans Crypto Ads

Melissa Alsoszatai-Petheo, of Microsoft’s Bing search engine, announced its advertising arm is banning all cryptocurrency advertisements. This follows market leaders such as Google, Facebook, and Twitter either severely restricting crypto ads or banning them altogether.

Also read: Ethereum Futures in US One Step Closer as CME Deal is Struck

Microsoft’s Bing Search Engine Bans Crypto Ads

Advertiser Policy Manager, Melissa Alsoszatai-Petheo, posted an update to Microsoft’s Bing search engine ad policy. Bing Ads to Disallow Cryptocurrency Advertising is the title of the company’s rather obvious move. “We are always evaluating our policies to ensure a safe and engaging experience for our Bing users and the digital advertising ecosystem,” Ms. Alsoszatai-Petheo began. “Because cryptocurrency and related products are not regulated, we have found them to present a possible elevated risk to our users with the potential for bad actors to participate in predatory behaviors, or otherwise scam consumers.”

World’s Second Largest Search Engine Bans Crypto Ads

Bing has consistently ranked a very distant second behind the Google juggernaut, which gobbles up better than 60% of search traffic on the internet. Google at the beginning of 2018 announced a far more specific series of cryptocurrency related prohibitions, down to defining contract for difference (CFDs) products.

It wasn’t too much later when Facebook followed, as we reported at the end of January, with “a new ruling issued on January 30, ‘ads must not promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings, or cryptocurrency.’” Twitter too, a mere two months later, presented its new advertising policy, severely restricting initial coin offering (ICOs) and token sales.

World’s Second Largest Search Engine Bans Crypto Ads

Protection is the Pretext

“To help protect our users from this risk,” the notice from Bing continued, “we have made the decision to disallow advertising for cryptocurrency, cryptocurrency related products, and un-regulated binary options. Bing Ads will implement this change to our financial product and services policy globally in June, with enforcement rolling out in late June to early July.”

Other than seeking a press cycle of promotion, it does appear “scams” were a bit of a problem during 2017, according to Bing’s annual report. “Tech scams are widely used by bad actors and we rejected 25 million ads in this category in 2017,” they insisted. And under the banner of misleading ads, Bing noted how last “year, we took down 30 million such ads, 20,000 such websites and 43,500 bad actors.”

Do you think crypto ad bans will have a negative impact? Share your thoughts in the comments section below. 


Images courtesy of Shutterstock.


Do you agree with us that Bitcoin is the best invention since sliced bread? Thought so. That’s why we are building this online universe revolving around anything and everything Bitcoin. We have a store. And a forum. And a casino, a pool and real-time price statistics.

The post World’s Second Largest Search Engine Bans Crypto Ads appeared first on Bitcoin News.

New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs

New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs

The European Securities and Markets Authority (ESMA) has announced that it will impose restrictions on the leverage offered for contracts-for-difference (CFDs) and binary options offered to European retail investors. Under the new measures, the leverage offered on cryptocurrency CFDs will be limited to no more than 2:1.

Also Read: PBOC to Strengthen Cryptocurrency Regulations in 2018 

European Securities Regulator Imposes Restrictions on Leverage Offered by CFD Providers

New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsESMA has agreed on what it describes as “temporary product intervention measures on the provision of [CFDs] and binary options to retail investors in the European Union (EU).”

The new measures will see restrictions on the leverage offered on cryptocurrency CFDs to no more than 2:1. The agreements will also mandate that traders provide an initial margin of “50% of the notional value of the CFD when the underlying [asset] is a cryptocurrency” – more than twice the initial margin required of any other CFD.

New Measures See Harshest Rules Imposed on Cryptocurrency CFDs

New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsESMA has stated that cryptocurrencies CFDs states that “CFDs with cryptocurrencies as an underlying raise separate and significant concerns as CFDs on other underlying” assets.

The regulator stated that “Cryptocurrencies are a relatively immature asset class that pose major risks for investors.” ESMA expressed “concerns about the integrity of the price formation process in underlying cryptocurrency markets,” arguing that such “makes it inherently difficult for retail clients to value these products.”

ESMA concluded that “Due to the specific characteristics of cryptocurrencies as an asset class the market for financial instruments providing exposure to cryptocurrencies, such as CFDs, will be closely monitored.” Based on its findings, ESMA “will assess whether stricter measures are required.”

New Rules to be Formalised in “Coming Weeks”

New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsThe measures will also see restrictions of 30:1 placed on “major currency pairs;” 20:1 for “non-major currency pairs, gold and major indices;” 10:1 for “commodities other than gold and non-major equity indices;” and 5:1 on “individual equities and other reference values.”

ESMA states that it “intends to adopt these measures in the official languages of the EU in the coming weeks.”

What is your response to the new restriction on the leverage offered by European CFD providers? Share your thoughts in the comments section below!


Images courtesy of Shutterstock


Want to create your own secure cold storage paper wallet? Check our tools section.

The post New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs appeared first on Bitcoin News.

Crypto Mania Peaked Around Christmas, Fallen Markedly Since Says IG Group

Crypto Mania Peaked Around Christmas, Fallen Markedly Since Says IG Group

As if it wasn’t clear enough, we just got another indication that the cryptocurrency markets have soured for price speculators. One of the biggest names in the contracts-for-difference field, IG Group, has revealed that crypto CFD trading is on the decline this year.

Also Read: Monthly Web Traffic for Major Bitcoin Exchanges Falls by Half

Cryptocurrency Trading Fattens IG Group’s Profit Margins

Crypto Mania Peaked Around Christmas, Fallen Markedly Since Says IG Group

UK-headquartered CFD and spread-betting giant IG Group (LON:IGG) has reported its quarterly results for the three months period which ended 28 February 2018, showing cryptocurrency trading had a great positive impact on its bottom line.

The FTSE-250 brokerage has had a record performance in terms of revenue, reaching a net of £152.9 million which is 30% higher than in the same period in the prior year, and 13% higher than the company’s previous record revenue quarter. Clients trading in cryptocurrencies accounted for an impressive 11% of revenue in the period, up from just 1% the year before. However, IG Group also warned investors that cryptocurrency trading by its clients has slowed markedly since the end of January.

Crypto Mania Has Already Peaked

Crypto Mania Peaked Around Christmas, Fallen Markedly Since Says IG Group
IG Group trading floor in London

Unsurprisingly given these results, the company’s following conference call for analysts and investors focused mainly on this issue. CEO Peter Hetherington said: “The crypto mania I think peaked as we approached Christmas, and then if you look at the interest from clients it has fallen away pretty markedly since then. I think whichever measure you track, whether it’s the price of crypto or whether it’s the volume of searches on the internet for crypto trading terms, or any other combination, I think you’d say that the wave has, to a large degree, passed in terms of client interest.”

“And whilst the price of crypto is still volatile by any normal standard it’s a tiny fraction of the volatility that you were seeing in the so-called asset class in the period around Christmas and in January. So, I’d just say it’s stopped moving anything like as much, although it’s still moving a lot, and client interest has fallen away a great deal both from informed and less-informed clients, and as a result the amount that people are trading on the asset class has fallen very considerably since the end of January. That’s not to say it will never restart but I think absent the price of crypto changing a great deal, probably up, it’s not going to be massively significant for the foreseeable [future].”

When should we expect to see the cryptocurrency markets exciting traders again? Share your thoughts in the comments section below!


Images courtesy of Shutterstock, IG Group.


Do you want to talk about bitcoin in a comfortable (and censorship-free) environment? Check out the Bitcoin.com Forums — all the big players in Bitcoin have posted there, and we welcome all opinions.

The post Crypto Mania Peaked Around Christmas, Fallen Markedly Since Says IG Group appeared first on Bitcoin News.

European Brokerage Adds Cryptocurrency CFDs for 24/7 Trading

European Brokerage Adds Cryptocurrency CFDs for 24/7 Trading

Robomarkets, a brokerage that operates in the European markets, has added access to trading CFDs based on cryptocurrencies for its clients. Some of the most popular cryptocurrencies such as bitcoin, bitcoin cash, dash, ethereum, litecoin, and ripple, have been added to the list of available trading instruments.

Also Read: Mastercard “Very Happy” to Use Cryptocurrencies, Just Not Real Ones

24/7 Trading

European Brokerage Adds Cryptocurrency CFDs for 24/7 Trading
Robomarkets offices in Cyprus

Robomarkets, a Cyprus Securities and Exchange Commission (CYSEC) registered investment company, has announced that the following CFDs (contracts-for-difference) are now available to its clients: BTC/USD, ETH/USD, BCH/USD, DASH/USD, LTCUSD, and XRP/USD. With a maximum admissible leverage of 1:5, the above-mentioned instruments may be traded on the Metatrader 4, MetaTrader 5 and Webtrader platforms as well as on the company’s own R Trader terminals. In addition to that, the R Trader platform now offers clients with an option to buy cryptocurrencies without swaps (overnight fees common in FX) with a leverage value of 1:1.

Introducing the new concept to its clients, the company explained that unlike the trading instruments most CFD traders are used to, cryptocurrencies may be traded 24/7, including on the weekends when fiat currency pairs, commodities and stocks are not available for live trading operations. The brokerage says that this factor provides traders with an opportunity to use more trading strategies, which require some extra time to add to a usual business week.

European Brokerage Robomarkets Adds Cryptocurrency CFDs for 24/7 Trading
Screenshot of BCH on R Trader terminal

Keeping Up With the Times

European Brokerage Robomarkets Adds Cryptocurrency CFDs for 24/7 TradingKonstantin Rashap, the company’s development manager in Europe commented: “RoboMarkets always keeps up with the times and implements cutting-edge technological solutions. Continuing our expansion on the European market, we’re pleased to offer our clients a new class of trading assets. By adding cryptocurrencies to the list of more than 8,700 instruments that are already available to RoboMarkets clients for trading, we’re not only responding to their demands, but also systematically expanding the list of our services and improving their quality.”

The European brokerage’s international sister company Roboforex first launched bitcoin and ethereum trading back in September 2017. The Belize-licensed firm also added CFDs based on bitcoin cash, dash, litecoin, and Ripple’s XRP earlier this year.

Is the promise of 24/7 trading a good way to get CFD traders excited about cryptocurrencies? Share your thoughts in the comments section below!


Images courtesy of Shutterstock.


Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

The post European Brokerage Adds Cryptocurrency CFDs for 24/7 Trading appeared first on Bitcoin News.

Bitcoiners Demand More Crypto CFDs and Spread-Betting in the UK

Bitcoiners Demand More Crypto CFDs and Spread-Betting in the UK

The UK’s CMC Markets Plc announced it would offer cryptocurrency contracts for difference (CFDs) and spread-betting, accessible at first to professional traders. Though too soon to call a trend, the company is following its rivals into an unsure market increasingly under threat from regulators.     

Also read: Since Embracing Bitcoin, Robinhood App Value Jumps to $5.6 Billion

More Crypto CFDs Added Due to Demand

Bitcoiners Demand More Crypto CFDs and Spread-Betting in the UK
Grant Foley

“With the cryptocurrency market growing rapidly over the past ‎‎12 months,” CMC’s Grant Foley explained, “we have received significant interest from our clients for bitcoin ‎and ethereum CFDs. As a result, we have developed a new offering for this ‎unique digital asset class. We recognise that cryptocurrencies can be ‎regarded as a volatile market, so we are initially only offering trading, on an ‎exclusive basis, to our experienced professional client base.”

Based in London, CMC Markets Plc is owned by Goldman Sachs. ‎It’s a worldwide market maker, and trades in contracts for difference, foreign exchange, and spread-betting. Spread-betting is a very British financial speculation similar to derivatives, and can be offered in parallel to CFDs. Its advantages include flexibility in trading hours, potential for innovation, and it usually has stop losses baked-in. Spread-betting is a contract between the market-maker and the client, not cleared by an exchange, and can avoid many regulations in doing so.

CFCs are financial derivatives. Traders take long or short positions on price without the bother of owning the actual asset – in this case, cryptocurrencies like bitcoin. They come in the form of indices, stocks, futures, bonds, commodities, or currencies. CMC for its part is entering crypto after rivals Admiral Markets, Gain Capital’s City Index, Plus500 Ltd., and IG Group Holdings Plc. have already proved the market can be made.

Bitcoiners Demand More Crypto CFDs and Spread-Betting in the UK

Mr. Foley of CMC continued, “We have built our bitcoin and ethereum cryptocurrency offering with our ‎clients in mind. Like all other financial instruments we offer, we always ‎recommend that clients understand the risks and conduct thorough research ‎before trading.”

Regulators Watching Closely‎

It’s an interesting time to enter crypto, especially with US futures flatlining and bitcoin’s price plummeting in recent weeks. Add to those last month’s Autorite des Marches Financiers intervention, effectively insisting such crypto derivatives will be regulated within the European Union’s MiFID II. It could mean strict business conduct standards, mandatory reporting, and many of financial products are barred from electronic advertising.

The fuss might be worth it, however, as “Plus500 said the hype around cryptocurrencies drew more customers to its trading platforms and the company forecast 2018 revenue ‘significantly ahead’ of market expectations,” Reuters reported.

Do you think CFDs are a good move for crypto? Let us know in the comments!


Images via Pixabay, CMC. 


At news.Bitcoin.com we do not censor any comment content based on politics or personal opinions. So, please be patient. Your comment will be published.

The post Bitcoiners Demand More Crypto CFDs and Spread-Betting in the UK appeared first on Bitcoin News.

France Cracks Down on Bitcoin Derivatives

France Cracks Down on Bitcoin Derivatives

Autorité des marchés financiers (AMF), the independent regulatory body governing France’s stock market, issued two statements today, one on initial coin offerings (ICOs) and another on the prospect of bitcoin derivatives. Both point to more oversight to come for crypto in France, including everything from formal authorizations to a ban on advertisements.  

Also read: How To Regain Control From Nanny Zuck

France Cracks Down on Bitcoin Derivatives

AMF, France’s markets regulator, insists bitcoin derivatives are subject to the European Union’s Markets in Financial Instruments Directive (MiFID II) which trigger all manner of new rules and authorizations. In its 22 February published missive, The AMF considers that the offer of cryptocurrency derivatives requires authorisation and that it is prohibited to advertise such offer via electronic means,” the agency argues. “The AMF has reached the conclusion that platforms which offer these products must abide by the authorisation and business conduct rules, and that these products must not be advertised via electronic means.”

During its analysis the AMF determined “the legal qualification of the notion of “derivative” in the context of cryptocurrency derivatives and […] to consider whether a cryptocurrency could be legally regarded as an eligible underlying. The notion of “derivative” is not defined in EU legislation per se.”

France Cracks Down on Bitcoin Derivatives

The AMF describes growth in crypto exchanges as a boom, offering “binary options, CFDs or Forex contracts with an end-of-day maturity (rolling spot forex), where the underlying is a cryptocurrency. Such contracts allow investors to bet on a cryptocurrency’s rise or fall, without holding the underlying.”

As a result, the legal status of crypto is almost irrelevant because the AMF determined “a cash-settled cryptocurrency contract may qualify as a derivative.” Furthermore, the agency found the European Market Infrastructure Regulation (EMIR) will be invoked, along with MiFID II, setting into motion rules for over the counter (OTC) derivatives and their online exchanges such as complying with “authorisation, conduct of business rules, and the EMIR trade reporting obligation to a trade repository. Above all, these products are subject to the provisions of the Sapin 2 law, and notably the ban of advertisements for certain financial contracts.”

AMF Also Takes a Hard Look at ICOs

The AMF publishes the summary of responses to the public consultation on initial coin offerings (ICO) was also revealed the same day, summarizing 82 comments from the French public concerning ICOs and their regulatory fate.

According to the agency, “a large majority of respondents expressed support for setting up an appropriate legal framework for this new type of fundraising.” Respondents were “digital economy players, individuals, finance professionals, market infrastructures, academics and law firms.”

France Cracks Down on Bitcoin Derivatives

The AMF offered three options for consideration going forward: “Promote a best practice guide without changing existing legislation (option 1); Extend the scope of existing texts to treat ICOs as public offerings of securities (option 2); Propose new legislation adapted to ICOs (option 3).” Of those, option 3 received 66% approval.  

“Respondents unanimously consider that an information document is necessary to inform buyers of tokens,” and should include project specifics, rights, distribution scheme, along with identifying the project’s heads and team. “Finally, the vast majority of respondents favour the establishment of rules making it possible to ensure the escrow of funds raised, and the setting up of a mechanism to prevent money laundering and terrorist financing,” the release concluded.

In response to the respondents, AMF officials have vowed to “continue work” on the prospect of regulating ICOs.

Is France overreacting? Let us know in the comments section.


Images courtesy of Pixabay, AMF.


Need to calculate your bitcoin holdings? Check our tools section.

The post France Cracks Down on Bitcoin Derivatives appeared first on Bitcoin News.

B2Broker Launches Cryptocurrency Payment Gateway

FX Aggregator B2Broker Launches Cryptocurrency Payment Gateway for Merchants

More retail forex brokers around the world can now offer their clients the option to fund their trading accounts with cryptocurrency. A tech provider from the FX industry, B2Broker, has created a simple platform for the online businesses to roll out.

Also Read: Independent Ratings Agency Alerts Investors About Dangers of Tether

B2Broker Cryptocurrency Payment Gateway

FX Aggregator B2Broker Launches Cryptocurrency Payment Gateway for MerchantsB2Broker, an aggregator and provider of turnkey, cloud, and liquidity solutions for the foreign exchange (FX) industry, has launched a new cryptocurrency payment gateway. The system is fully automated for both deposits and withdrawals and is translated into 10 languages. It also offers an improvement in the transaction speed to less than 20 seconds, compared with traditional payment gateways which can take days.

Beyond just online retail forex brokers, the company says the solution was developed to cater for a wider spectrum of business clients. These include cryptocurrency exchanges, ICO campaigns, hedge funds, online stores and other merchants wishing to accept cryptocurrency payments.

Evgeniya Mykulyak, COO of B2Broker, commented, “We believe our crypto gateway will prove to be one of the most popular B2Broker products. We have responded to our clients who want to accept payments in cryptocurrency due to its popularity and are looking to expand their potential client base. With our cryptocurrency gateway, our main focus is on convenience, speed, security and cost-saving.”

Plug and Play

FX Aggregator B2Broker Launches Cryptocurrency Payment Gateway for MerchantsAs the company focuses on turnkey solutions, such as white label services for MT4 and MT5, an easy integration process is an important feature for its clients. The gateway can be integrated via a single API making it possible to get up and running very quickly. New cryptocurrencies can be added in as little as five minutes by simply providing the addresses of the wallets into which payments will be received.

Merchants are offered three different options to collect their deposits. They can receive each cryptocurrency into their own wallets directly, convert everything into bitcoin, or convert everything into fiat and receive it to their banking accounts. The company says that cryptocurrency gateway payments are much safer and less vulnerable to fraud and DDoS attacks than traditional payment systems. B2Broker even takes full responsible for safety of money on transit wallets and promises that in the event of a hacking incident it will refund the merchant.

FX Aggregator B2Broker Launches Cryptocurrency Payment Gateway for Merchants

Do you think forex traders will want to deposit funds with cryptocurrencies instead of credit cards or bank transfers? Tell us what you think in the comments section below.


Images courtesy of Shutterstock and B2Broker.


Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

The post B2Broker Launches Cryptocurrency Payment Gateway appeared first on Bitcoin News.