(Newswire.net — June 5, 2020) — In just a blink of an eye, the world has become an almost completely digitized place. We use technology to communicate, have fun, work, travel, and study. Gadgets have never been such a big part of our daily lives before and it is making a major impact on many different levels. Most importantly, technology has managed to transform the economy and industries within it.
More or less, every industry has experienced shifts throughout this period of time. However, some of them managed to utilize possibilities given by unprecedented innovations and novelty better than others, while benefiting from the global change. Sectors that were always tightly related to technology and its development, obviously, made greater changes and adapted faster. However, some industries that were rather isolated from technology and remained largely traditional and paper-based became almost solely reliant on digital technologies in different ways.
One of the finest examples of such revolutionary changes is most certainly the financial industry. This sector has existed for centuries and even millenniums, going through a number of game-changing processes over this time. However, what modern days brought to it is completely different and absolutely unprecedented. The worldwide financial net of transactions is not completely digital while a growing number of services are becoming available on web platforms and within mobile applications.
In fact, one could have a hard time finding a commercial bank or even a trustworthy insurance company without a digital platform of its own. Such platforms are usually websites or mobile applications, developed explicitly for particular companies. They are convenient, fast and do not require leaving the house or workplace. This is why more and more people are choosing to use them instead of traditional banking services.
The 21st century might be the era when nations will start going cashless as digital technologies are substituting paper banknotes step by step. Some countries are quite far ahead as Sweden, officially the most cashless country on earth is planning to become the pioneer society in refusing the use of cash altogether. Such changes make financial means more accessible to people in rural areas and those belonging to particular social groups, minorities, as well as women.
The rise of Forex amid the technological revolution
Stock trading has been a crucial, major part of the financial industry for centuries. The first major markets were founded in the 17th, 18th centuries in cities like London or New York and keep dominating the globe to date. However, everything changed along with the increased access to technology and markets started adapting to the digital reality of today.
Forex Trading now is one of the most widespread and popular means of financial operations online. Forex platforms offer an opportunity of making a profit out of currency exchange to millions of people worldwide. As a result, a growing number of individuals choose to invest their savings or extra money in FX trading in an attempt to gain even more.
However, the truth is that overnight success stories are not as common in Forex Trading. There are many examples of successful billionaires from all across the world who made initial funds out of Forex Trading. Notably, George Soros, an 89-year-old philanthropist, and businessman started accumulating his wealth of over $8.3 billion as a Forex trader. Nevertheless, for anyone in business, making even small amounts of money as a trader requires months or even years of hard work and sleepless nights. On the contrary, Forex is often seen and portrayed as a quick and easy way to make money, which it is not.
Amid the growing number of scams and unlicensed Brokers and platforms online, many nations are tightening their already strict regulations. Nevertheless, many are struggling to cut scammers and their victims within their jurisdictions. One of the very few bright examples is South Africa. The nation that has a flourishing Forex market managed to reduce the number of FX scams in South Africa. So, what did they do differently? Why are the rest of the nations, even some more fortunate ones struggling to contain the situation?
Different countries introduce a whole variety of legislation that importantly differ from each other. However, the general trend is introducing penalties or bans on trading with unlicensed Brokers or using unrecognized, as well as unregulated platforms. This approach certainly has positive results in terms of penalizing those, who cross the boundaries of legality. However, the vast majority of lawmakers in this field forget that the main aim of new regulations should be to prevent scammers from appearing in the first place.
While nations in Northern Europe and the Americas are introducing strict bans and tight legislation, South Africa’s influential financial regulator FSCA (The Financial Sector Conduct Authority) decided to change its approach. The institution went through a complete fundamental transformation as it decided to invest more in raising awareness within the community and potential customers.
With the new FSCA legislation, key emphasis comes on educating Brokers, as well as traders and platform owners about the importance of legal operations. They explain in detail how unlicensed brokers, traders or other entities can lead to lost funds and bankrupted businesses.
Moreover, the new legislation gives FSCA more power to step in during market crisis situations when slumps are not caused by customers’ actions. With this, the body becomes responsible for the financial stability of not only its customers but also of the entire financial network and community in South Africa and beyond.
Many in the industry are hopeful that other countries and their regulators will change their approaches likewise. South Africa is setting a great example of dealing with scammers by fundamentally preventing such actions from happening. In the end, we should all realize that in the era of digital technologies, regulation is no key but education is.