This segment has developed with the advent of dedicated electronic trading platforms and the internet, which allows individuals to access the global currency markets.
Starting in 2010, financial regulators in developed markets have introduced measures to limit the amount of leverage that retail investors can take on, particularly across foreign exchange transactions.
In the United States, the Commodity Futures Trading Commission (CFTC) limited leverage available to retail forex traders to 50:1 on major currency pairs and 20:1 for all others.
In Europe, the European Securities and Markets Authority (ESMA) caped the amount of leverage that brokers and CFD providers could offer retail investors.
[citation needed] In Australia, the Australian Securities & Investments Commission (ASIC) introduced a product intervention order in March 2021 that included leverage limits that brokers and CFD providers could offer retail investors.
[10] However, due to the decentralized nature of currency trading and the easy global access to the internet, a number of brokers are based in less restrictive jurisdictions.