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Exclusive: Devexperts to Focus on Building out DXtrade in 2020

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Towards the end of May, Devexperts announced that it was launching a new SaaS (Software-as-a-Service) trading platform, specifically designed for the retail FX and CFD industry.

So far this year, volatility has surged, driven by COVID-19. This, in turn, has brought a new wave of traders and interest into the FX market, with many brokers reporting record trading volumes, particularly in March.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

The launch of Devexperts’ new trading platform, called DXtrade, comes at a time of peak demand for the industry. To find out more, Finance Magnates caught up with Conor O’Driscoll, VP of OTC Platform at the company.

As Finance Magnates reported, DXtrade is an “off the shelf” trading solution for CFD brokers. The platform is customizable, with brokers being able to determine the layouts and setup of the platform.

“Our initial plan was to launch it at this year’s IFX Expo in May. Unfortunately, this was not possible for obvious reasons, but the timing became even better, as the trading industry is experiencing uplift,” O’Driscoll explained to Finance Magnates.

“Many brokers report rise in trading volumes, traders keep being engaged by high volatility, all these result in higher attention to technology. We felt that the market was ready for a new platform vendor and that brokers are still looking for alternatives to the current vendors in the market, regardless of the current Covid-19 circumstances.”

Devexperts to focus on building DXtrade offering

When asked what Devexperts plans were for 2020, O’Driscoll outlined that the focus for the software provider for the capital markets was on building out its DXtrade offering.

“Our main focus towards 2020 is continuing to build on our DXtrade offering, we have a very exciting pipeline of new features and developments that we will be rolling out throughout the year and we look forward to sharing them with the market as they are released,” he said.

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COVID-19 enhances the need for trading technology

Although the coronavirus pandemic has largely been a boost for brokers, the virus has brought a number of challenges. One of them, as pointed out by O’Driscoll, is that COVID-19 has made it harder to manage infrastructure remotely.

“… the ability for brokers to rely solely on their platform provider for support and maintenance during such difficult times certainly enhances the need for platforms like DXtrade,” he highlighted.

“Having to manage your own infrastructure remotely can be quite a challenge and if anything COVID-19 has made clear that brokers can benefit from using platforms such as DXtrade through a SAAS model.”

As Finance Magnates analysed previously, automation can help brokers be regulatory compliant, keep up with higher levels of trading volumes, and be able to handle larger numbers of clients being onboarded.

When asked whether he thought automation was increasingly important during times such as these, O’Driscoll replied: “I would certainly agree that there are a number of benefits to automation and also the outsourcing of functions within the financial space. Volatility within the market is always cyclical and never constant, this often results in a brokers staff’ either being understaffed/overworked during high periods of volatility and overstaffed/underworked during low periods, which is highly inefficient. 

“Through the use of automation and relying on 3rd party vendors like Devexperts, brokers can better manage their resources, resulting in improved efficiencies throughout their operations.” 

Experience is key

So what exactly is required to develop and launch a new trading platform for the FX and CFD industry? Besides time, money and skill, O’Driscoll pointed out that experience is one of the key ingredients needed.

“…I think what has really allowed us to launch DXtrade is the experience we have built over the past 18 years. Compared to other fintech startups, we had a significant advantage as we have been building custom trading platforms since 2002. 

“As a company, we have had to be creative and to think outside the box when delivering these platforms for brokers and it is these experiences, which have allowed us to build a unique platform like DXtrade that is affordable for the entire CFD market. After having been working on DXtrade for the past 12 months, we can unveil it to the market.”

Source: https://www.financemagnates.com/executives/interview/exclusive-devexperts-to-focus-on-building-out-dxtrade-in-2020/

Finance Magnates

Judge Tosses $53M Fraud Case Against Ikon Finance and Hantec Market

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A judge in the UK high court dismissed a breach-of-contract suit against both Ikon Finance and Hantec Markets where a heavyweight retail client was seeking $53.0 million in damages over the allegedly misappropriated funds.

Ikon Finance exited the retail forex market in 2017 following regulatory restrictions by the UK Finance Conduct Authority (FCA). At the time, Hantec acquired the retail client base of IKON Finance after the regulator said that the rival broker has inappropriate human and operational resources in place.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

Following this, a Jordanian resident named Hafez Fakhri Taji Al Farouqi accused IKON Finance of moving his account to Hantec without his consent, seeking nearly $11.6 million in misappropriated funds and damages. He also filed a lawsuit against Hantec for $42 million in civil damages, alleging the migration of his account took place without prior authorization.

Al Farouqi also claimed that both brokers secretly deducted unauthorized commission and introducer fees from his account. Another argument was that Hantec Markets closed his account without sending cancellation terms, giving reasonable notice, or enough time to make alternative arrangements.

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The litigation began in December 2019, but after a six-month investigation, a judge acquitted both brokers, saying it was “fanciful” to believe they had faked trades that caused Al Farouqi to incur substantial losses. The case was entirely tossed out because the evidence was too weak to support a conviction that IKON and Hantec conned the Jordanian investor or breached regulations when they closed out.

Hantec Markets responds

Back in October, Hantec Markets has strongly refuted all claims of Hafez, and the FCA-regulated broker is fighting back against each allegation. Specifically, the company said it’s neither obliged to continue their relationship or to explain for what reasons it closed any client’s account. It also denied that the retail trader had suffered any loss or damage as a result of its decisions and that it gave him a “reasonable” nine days’ notice before the closure of his account.

After doing a background check, Hantec added in its defense that it did not charge any commission from Al Farouqi’s accounts. The UK-based FX trading brand also tried to dismiss the suit on the grounds that the investor agreed to move his trading account after he ticked a dialogue box to accept Hantec’s terms and conditions.

Al Farouqi reiterated in its December that the broker didn’t follow good practices as a nine-day notice period did not give him an opportunity to respond if they misunderstood the facts of his situation.

As widely known, IKON Finance managed to avoid several lawsuits against its operations around the world, including those suing its NFA-licensed subsidiary in the US, IKON Global Markets.

Source: https://www.financemagnates.com/forex/brokers/judge-tosses-53m-fraud-case-against-ikon-finance-and-hantec-market/

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Finance Magnates

Vitalik Buterin Says Ransom Hackers Behind $5M-Fee ETH Transactions

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Two transactions spotted on the Chinese mining pool Spark Pool have stunned everyone in the Ethereum community over the last two days. While nearly 20,000 ETH worth $5.2 million was paid as the transactions fees, the value transferred was only 350 ETH worth less than $90,000 — and one of them was only 0.55 ETH or $133.

At glance, the crypto community suggested that the sender mistakenly mixed up the fields on the value of the transfer and the fee. Today, however, Ethereum’s Co-Founder Vitalik Buterin and China-based blockchain analytics company PeckShield floated the idea that a yet-to-be-disclosed exchange is being held to ransom by hackers who gained unauthorized access to its wallets.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

Criminals are thought to have captured partial permissions, such as server management or something similar. But since the exchange’s private key has a multi-signature verification, which help protect against theft by requiring multiple private keys to sign each outgoing transaction, they were unbale to send crypto holdings to their own wallets.

So, the unusual transactions that grabbed the community’s attention were carried out by the ransomware gang to blackmail the exchange and force them to send their chunk, otherwise they would continue to burn their assets though paying excessively high transaction fees.

Ethereum’s Co-Founder further explained that “Similar situations could happen in “scorched earth” games, including scorched-earth vaults aka “Moeser-Eyal-Sirer” vaults, as well as scenarios where hackers can slash but not steal staked funds”.

While the story is yet to be confirmed, the human error theory doesn’t make sense any more as if it was true with the first transaction, the second one might invalidate this assumption. In addition, it can easily be noted that wallet address sending the few ethers and paying generous gas price belongs to a crypto whale. The shipper’s wallet had over 21,000 ETH left in the address, worth more than $5 million, even after the $5.2 million transaction fee was paid out.

Further, the sender’s wallet has been very active all the time, showing several transactions almost every minute, which matches operations carried out by a trading venue.

Blackmail campaigns are not uncommon in the crypto space. A few months ago, Binance revealed that a pro-claimed hacker previously demanded 300 BTC from it for “withholding 10,000 photos that bear similarity to Binance KYC data.” After he refused to give the team any irrefutable evidence regarding the source of breach, Binance ended conversation, but the hacker then started distributing the KYC data online and to media outlets.

Source: https://www.financemagnates.com/cryptocurrency/news/vitalik-buterin-says-ransom-hackers-behind-5m-fee-eth-transactions/

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Finance Magnates

Estonia Tightens Checks on Crypto Firms, Cancels 500 Licenses

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The Estonian regulators have revoked licenses of 500 cryptocurrency firms, roughly 30 percent of total approved providers, as it continues to tighten its grips on risky activities.

The move comes as a series of scandals in Europe have undermined trust in authorities’ ability to tackle money laundering.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

Estonia, a Baltic state in north-eastern Europe, came under the spotlight after Danske Bank, Denmark’s biggest lender, was accused of watching $230 billion through a tiny Estonian branch.

Estonia was among the first jurisdictions in Europe to legalize crypto-related activities back in 2017. In less than three years since the country introduced licensing for companies operating in the cryptocurrency industry, the number of licenses issued has surpassed 1400.

The Estonian Financial Intelligence Unit (FIU), the regulator issuing the licenses, said the regulatory crackdown is not meant to curb cryptocurrency industry but rather regulate the field more thoroughly to prevent risks related to money laundering.

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So far, the FIU dropped the hammer largely on crypto firms that failed to start operations in Estonia within six months of getting a permit, Bloomberg reported, quoting Madis Reimand, who heads the Baltic country’s intelligence unit.

“This is a first step in tidying up the market, allowing us to take care of the most urgent issues by permitting operations only for companies that can be subjected to Estonian supervision and coercive measures,” Reimand added.

The regulator said that authorities in the Baltic country have learned lesson from the banking sector the hard way, and that they must now deal with new international risks, and cryptocurrencies are amongst the most urgent of these.

Furthermore, the Estonian government has passed a bill that tightens the regulation on granting licenses to crypto providers. Among other things, the application processing time was extended from 30 to 90 days, and the license fee has been increased from EUR 345 to EUR 3,300.

Crypto entities registered in Estonia will also need to incorporate in the country or open an Estonian branch of a foreign company.

Source: https://www.financemagnates.com/cryptocurrency/regulation/estonia-tightens-checks-on-crypto-firms-cancels-500-licenses/

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Finance Magnates

Japan Court Upholds Mt. Gox Ex-CEO Conviction for Tampering Records

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Mark Karpeles, the former CEO of the notorious Mt.Gox, has suffered a new blow after Japanese high court threw out his petition and upheld the conviction on charges of manipulating electronic data.

Another Japanese court cleared Karpeles last year of embezzlement and breach of trust charges, but was found guilty of the dubious data charges. In both cases, however, the court handed him a suspended sentence, meaning he wouldn’t have to serve jail time.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

While the French citizen claimed that he was just trying to reduce risks for the exchange’s users, Tokyo’s court said Karpeles had manipulated data to harm his clients, betraying their trust and abusing his engineering skills.

Japanese prosecutors had initially demanded 10 years in prison as they said Karpeles was guilty of mixing his personal finances with Mt.Gox’s assets in order to conceal the exchange’s losses to hackers. The court handed him down a two and a half years jail sentence, but he doesn’t not have to serve this term unless he commits another offence within four years.

Mt. Gox ex-CEO asks US to toss fraud lawsuit

Karpeles also tried to shut down the class action lawsuit against him in the US which was filed by the last remaining plaintiff, Gregory Greene.

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Karpeles argued the court to dismiss the last remaining fraud charge on the grounds that the ex-Mt. Gox customer has changed the factual basis underlying his claims. Greene voluntarily dismissed two other claims over Karpeles’ handling of the exchange and leaving major security holes that led to future hack attempts.

Gregory Greene filed a complaint on behalf of bitcoin users in a US district court in Philadelphia, accusing Mt. Gox and its CEO Mark Karpeles of negligence and fraud for not protecting the exchange from theft.

Greene, who claimed his own bitcoin holdings were about $25,000, said Mt. Gox failed to provide its users with the level of security protection for which they paid.

However, Karpeles claimed the court lacks jurisdiction and filed a motion asking the judge to dismiss the lawsuit.

Mt. Gox went offline in 2014 in the single biggest setback in the history of Bitcoin after 850,000 bitcoins were stolen in a hacking attack. Under suspicious circumstances, the Japanese exchange claimed it had lost track of about 750,000 bitcoins belonging to customers and another 100,000 of its own, but later said it had found 200,000 bitcoins.

Mt. Gox is now undergoing bankruptcy rehabilitation in Japan, overseen by court-appointed trustee Nobuaki Kobayashi.

Source: https://www.financemagnates.com/cryptocurrency/news/japan-court-upholds-mt-gox-ex-ceo-conviction-for-tampering-records/

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