What are the best BaFin Forex brokers and how to find them

Contents

1 What are the best BaFin FX brokers?
2 What is BaFin and how does it work?
3 How does BaFin protect Forex traders?
4 Financial scams and BaFin regulated Forex brokers
5 Why are there such a few FX brokers regulated by BaFin?
6 The dark past of BaFin and how was it able to overcome the challenges
7 Is it easy to use the website of BaFin?
8 Should you start trading with BaFin regulated FX brokers?

The Federal Financial Supervisory Authority, better known as BaFin, is the main financial regulator of Germany. Known as the Bundesanstalt für Finanzdienstleistungsaufsicht in German, the regulator is responsible for ensuring the financial stability of the whole financial system of the country.

As of today, the regulatory body looks over companies like banks, financial services companies, insurance companies, stock exchanges, and other obligated institutions. The main role of this regulatory body is to identify and eliminate any type of financial crime, promote anti-money laundering in Germany, and fight against financial terrorism as well.

BaFin is an independent body, which reports directly to the German Federal Ministry of Finance. The company is led by a board, which includes four executive directors and the president. In the whole EU, BaFin is one of the largest supervisory authorities, it has two headquarters: one in Bonn, and another in Frankfurt.

Today, we are going to talk about best BaFin Forex brokers, so, if you want to learn more about this regulatory body and the FX brokers that own its licenses, follow our guide carefully!

What are the best BaFin FX brokers?

Finding the best Forex broker is not an easy thing, however, regulations are something that can help you a lot. Trading with a Forex broker that owns a license from a regulator like BaFin can be a very safe and secure experience. There actually are a number of brokers that are regulated by this company, and below, you can see our list of the best of those brokers!

Our Top Rated Broker

Licences

FCA, CySEC, IFSC, ASIC, DFSA

Min. depo

Leverage

1:888

Platform

MT4, MT5, WebTrader

XM

AvaTrade Review – Broker of choice since 2005

Licences

ASIC, FSA, FSCA, FFAJ, FSRA, FSC

Min. depo

100 USD

Leverage

400:1

Platform

MT4, MT5

AvaTrade

Exness Forex broker review – Everything it has to offer

Licences

CySEC, FCA, SFSA

Min. depo

$10

Leverage

1:2000

Platform

MT4, MT5

Exness

What is BaFin and how does it work?

BaFin, as we have already said, is a federal financial oversight authority headquartered in Germany, it takes care of different aspects of the financial market in the region and is one of the largest regulatory bodies in Europe. In 2002, three major industry regulators came together to form this regulatory giant, these three regulators included The Federal Securities Supervisory Office, The Federal Insurance Supervisory Office, and the Federal Banking Supervisory Office.

In the beginning, as Forex was not that successful in Germany, BaFin did not really have any oversight over this sector. However, due to the huge growth of the field in recent years, BaFin has started actively working on the field of Forex and everything connected to it. BaFin is an independent body and it is not funded by the federal government, it mostly gets money from the institutions that it regulates, which means that the government has no interference in the things that BaFin does.

The main goal of the regulatory body is to maintain the integrity and transparency of the financial sector in the country. Also, it ensures to maintain investor confidence in the different parts of financial markets and makes sure that every single financial institution that operates in the country strictly follows the rules and guidelines set by the BaFin itself.

How does BaFin protect Forex traders?

Trading with BaFin regulated Forex broker is a very safe experience for several different factors. First and foremost, according to the Securities Trading Act, the number one responsibility of the company is consumer protection. Consumer Advisory Council, which is part of BaFin, is the thing that collects and analyses different types of information on the financial markets. By doing so, they are making sure that the investors and consumers are not being exposed to any type of danger.

There are many problems that an investor might come across in the financial world, this includes price manipulation, insider trading, money laundering, etc. BaFin, as an independent body, has the power to initiate legal actions if there is some type of misconduct. With this, BaFin makes sure to protect the consumers on the market as much as they can.

Financial scams and BaFin regulated Forex brokers

Forex market is full of different types of scam companies that are very actively trying to get to people and steal their funds. One of the biggest advantages of using an FX broker regulated by BaFin is that you can be sure that your funds are in safe hands. BaFin does not tolerate any type of financial scams and it gives traders the ability to report any type of financial misconduct on the market. BaFin is one of the key players in keeping German investors safe and the economy of the country alive.

This, on its own, helps the whole region as Germany is a huge player in the EU. BaFin has a very well maintained and developed online platform, with the help of which, the regulator is able to help the people on the market exactly when they need any type of help. Also, the regulator has a special page dedicated to the Forex brokers that it authorizes, so, before you start trading, you have the ability to learn everything that you might need about a Forex broker on the official website of BaFin. This includes the current regulatory status, history of the broker, and everything about the misconduct or any type of dangerous activity that the broker might have done in the past.

Also, in case there is some type of problem between the financial company and its user, BaFin encourages them to settle without going to court and is actually helping them very actively to resolve the problems that they might have. Below, you can check out some of the brokers that caught our eyes while working on this guide.

XM

Min. Depo

Licences

FCA, CySEC, IFSC, ASIC, DFSA

Leverage

1:888

Platforms

MT4, MT5, WebTrader

AvaTrade

Min. Depo

100 USD

Licences

ASIC, FSA, FSCA, FFAJ, FSRA, FSC

Leverage

400:1

Platforms

MT4, MT5

Min. Depo

Licences

FSA, FSCA

Leverage

1:1000

Platforms

MT5,

Plus500

Min. Depo

$100

Licences

FCA, ASIC, CySEC, FSCA, FMA, MAS

Leverage

1:30

Platforms

WebTrader, Windows 10 Trader

Why are there such a few FX brokers regulated by BaFin?

Although trading with a broker that owns BaFin authorization is a very safe and smart thing to do, there are not so many brokers that own licenses from this regulatory body. There are several reasons for that, first being that there are many other regulatory bodies in the region that are less strict than BaFin.

Because of the EEA initiative, every single European regulated financial company is able to offer its services throughout the region without having to open their offices in every single country. Because of this, Forex brokers find it easier to set up their companies in a country that offers guidelines that are much easier to follow. BaFin is known to be one of the strictest regulators in the EU, which is something that prevents many of the brokers to open up an office in Germany.

Also, Germany is known to be very expensive when it comes to starting a business, and the tax rates stand to be one of the highest around the world. Because of such an expensive environment, it is very hard to have a good profit, because of which, most of the Forex brokers prefer to avoid BaFin. Also, there are many other regulatory bodies such as FCA in the UK and CySEC in Cyprus, which gives the brokers the chance to offer their services to the citizens of the EU without having to follow the strict rules of BaFin.

The dark past of BaFin and how was it able to overcome the challenges

As of today, Forex brokers regulated by BaFin are known to be very safe. However, this was not the case in the first days of the regulatory body. It had many problems but thankfully, as of today, the regulator was able to overcome all of those challenges. In the beginning, the company went through many different corruption scandals when the internal board members were said to have misappropriated the funds. Also, the organization was very hardly criticized after the financial crisis of 2008.

There were some leaked internal documents of the company that proved that several banks had bad loans and ‘troubled businesses’ had debts which was as much as 816 billion Euros. Thankfully, the board of BaFin has changed over the years and so did its reputation. As of today, the regulatory body is known to have a huge impact on the success of the economy of Germany. Also, the authorities are overseeing the day-to-day activities of BaFin and with this, the job done by the organization is a lot safer.

How can a broker register with BaFin?

To be able to apply for a license, a broker has to meet the minimum capital requirements that are demanded by BaFin to cover credit, market, and operational risks. With this, the positions of customers are very much protected. Also, the audit reports should include information about the state of liquidity.

Also, BaFin Forex brokers should have at least two executive directors or senior managers with enough knowledge and professional experience. In addition, the employees should have never been blacklisted by the Federal Central Register and the Central Commercial Register.

Is it easy to use the website of BaFin?

BaFin has a very good website, which is very easy to get around. The website includes all of the information that you might need, and although this is a German regulator, the website is offered in both, German and English. You can get around the website very easily and find any type of information you might need. Pages are distributed so that even if you don’t really have much of an experience you can still find everything that you need very easily.

Should you start trading with BaFin regulated FX brokers?

Because of the strict rules that this regulator has, not so many Forex brokers are authorized by BaFin. However, those that are, represent one of the safest and most secure Forex brokers on the market. With the safety and security that these Forex brokers offer you, you can very freely and safely trade Forex.

BaFin regulated Forex brokers are known to be one of the best operators on the market and not for the wrong reason, the guidelines and rules that the regulator has set out over the last few years made it one of the leader regulators on the market. BaFin represents one of the most important players in the economy of the region and the whole world as well. It supervises about 2700 banks, 800 financial services institutions, and over 700 insurance companies. Although the company had its hard times, as of today, it stands to be one of the most trustworthy regulators in the region.