Forex trading grows in popularity in Hungary as market continues to mature

For many years, Cyprus and the UK have been Europe’s Forex trading powerhouses thanks to their strong regulatory environments and key geographical position but, as Central European markets continue to expand and mature, Hungary is seeing a growing number of traders and attracts more foreign investors.

According to a 2018 BrokerNotes study, the popularity of Forex trading has skyrocketed in Hungary, going from approximately 22,000 online traders in 2017 to 44,000 in 2018. This places Hungary #17 in Europe, but experts point out the market is quickly maturing and will continue to grow. There are several factors behind the evolution of the Forex market in Hungary, starting from the role played by the National Bank of Hungary to the shift in public perception and the changing profile of the average online trader.

How the Government’s MNB act has created a secure trading environment

A stable, secure, customer-centric regulatory environment is the primary requirement for any online trading market. Without it, customers can easily fall victims to scams, which is why so many people avoid creating accounts on platforms that don’t guarantee secure transactions. The Hungarian government has understood this need for security, which is why the government released the MBN act to regulate the activity of all companies and individuals in the financial sectors.

The Magyar Nemzeti Bank (MNB) is Hungary’s Central bank, but unlike most other European countries, it also serves as an independent regulatory body. This automatically creates more trust among traders, because all the dealers, regulated brokers and financial institutions operating in the country abide by the framework created by the MNB under the MiFID derivatives issued by the EU. Since the main regulatory entity is also the Central Bank, every financial irregularity is treated with great attention to detail, which gives traders the peace of mind that their funds are taken care of. Apart from being an independent regulatory body, The Magyar Nemzeti Bank, which was established in 1924, maintains Forex reserves and CFDs offered by brokers.

MNB has taken extensive measures to ensure that all Forex traders are protected and that the companies which have engaged in fraudulent activities are swiftly punished. For example, the bank has a close partnership with the independent PBT Financial Arbitration Board (PBT (Pénzügyi Békéltető Testület) to help customers solve disputes with regulated brokers. Thus. If a customer believes their rights were infringed or that a certain Forex broker didn’t abide by the best rules and practices, the PBT will provide affordable arbitration so that the two parties can come to an understanding without settling the matter in court.