We put the most common question, “is Forex Trading Legal?” to some of South Africa’s Forex Experts asking them to weigh in.
But overwhelmingly, the straight simple answer is YES, it is legal to trade forex in the jurisdiction of the Republic of South Africa according to the FSCA.
Before we delve into whether Forex trading is legal and where it is not, let’s take a look at why Forex has become extremely popular.
The Forex trading craze is now a global phenomenon accessible to anyone, driven by improvements in automation technology and the advent of smartphones and tablets.
These factors have driven advertising of Forex trading and Forex products to some of the highest levels ever seen since the 1990s.
The last 10 years has seen a lot of internet penetration, which has seen Forex trading move into regions of the world that had never heard of this 5-letter word before.
Despite the spread of Forex trading, the market is also a place where there is a lot of geographical inequality: where things are an easy breeze for traders in some countries, in others they present all kinds of challenges.
Quick Overview of our “Is Forex Trading Legal in South Africa?” Review
✔️Forex Brokers List by Country
✔️Forex Brokerage Payment Systems
✔️Best Countries to Trade Forex
Countries allowing Forex trading without many restrictions
A list of Forex regulators in other countries
A list of Countries allowing Forex trading but heavily restricted
Countries where Forex Trading is illegal and banned
Forex trading in Muslim countries with Shariah law
In Conclusion
Most of the Forex literature on the internet showcases and presents Forex in a manner that assumes that all traders in all countries have the same access to knowledge, skills, tools, technology and resources to trade Forex.
This is very far from reality.
10 Best Forex Brokers in South Africa for 2025
Rank
Broker
Review
Regulators
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Official Site
Forex Brokers List by Country
The geographical location of Forex brokers is one area where there is a huge disparity.
Most of the Forex brokers in the world today are located in the U.S., Europe (UK and Cyprus specifically), Asia (Japan, Singapore, Australia) and the Middle East.
There is hardly any brokerage presence in Africa, except in South Africa.
This has led to a situation where those who trade Forex in countries where there is no physical brokerage presence are at the mercy of the offshore brokers and the regulations issued by the agencies that oversee these brokers.
U.S. Forex Brokers
After the September 11, 2001 terrorist attacks in the U.S., the government revised the rules under which U.S. companies could do business with foreign entities.
This led to a situation where almost all U.S. Forex brokers began shutting down accounts of many traders from countries that were on the blacklist of the U.S. Office of Foreign Assets and Control (OFAC).
To date, traders from countries on the OFAC blacklist are still unable to open accounts with U.S. Forex brokers.
Another topical issue that concerns trading with U.S. Forex brokers is the issue of the U.S. tax law known as the Foreign Assets Tax Compliance Act (FATCA).
Under the provisions of FATCA, U.S. citizens are expected to declare any income made worldwide, including any profits from the proceeds of Forex trading with foreign brokers.
FATCA also provides for sanctions on foreign companies that fail to provide information to the IRS on U.S. traders who have trading accounts with them.
In order to avoid any problems with the IRS, many brokers located in Europe and Asia have simply closed their doors to U.S. traders.
As it stands today, traders in the U.S. can only trade Forex effectively with U.S. Forex brokers. U.S. traders will not miss much by trading only with homegrown brokers.
The regulatory environment in the U.S. Forex market is strong; arguably the best organized as well. The technology base that serves brokers and traders in the U.S. is very strong as well.
New York is recognized as a major Forex trading hub. The data centres and the virtual private servers that serve the U.S. trading hub are well constructed and properly co-located.
The Forex market in the U.S. is very robust; unfortunately, it is only open to U.S. citizens and citizens of a few other countries.
European Forex Brokers
The major Forex trading hubs in Europe are located in London and Cyprus. Some major hubs are gradually emerging in Central and Eastern Europe (Malta, Bulgaria, Russia and Romania).
Cyprus emerged as a major trading hub due to its investment friendly policies that attracted a large number of Forex brokerages.
In addition, no restrictions are placed by these brokers on the traders they can accept (except banning U.S. citizens from their platforms in order to avoid compulsory reporting to the U.S. IRS).
Many traders from far-flung regions of the world presently trade with brokers in Cyprus and the UK. The regulatory environment in the UK is very strong.
While there have been some criticisms about the Cyprus Securities and Exchange Commission (CySEC) being a bit too lax with enforcement, CySEC has indeed made some strategic changes to strengthen regulation in Cyprus.
Asian Forex Brokers
Forex trading in Japan, Singapore and Australia is hitting levels not seen in many years.
Recently, the Bank of International Settlements declared Singapore to be the number 3 Forex trading hub in the world, after London and New York.
Taiwan now ranks as one of the countries with the largest Forex reserves, thanks to the massive foreign investment flows into that country.
China has seen a massive boom in the Forex brokerage business, and introducing brokers for Forex companies are easily netting trading volumes of 90,000 lots per month.
Asian regulators have pushed towards enhancing the Forex markets in their countries to adapt better to the local environments within their jurisdictions.
Presently, regulators in Japan and Australia have begun a cooperative effort to ensure that Forex brokers in each country restrict their marketing efforts to their local markets to promote better regulation and compliance with local practices.
Many Forex brokerages have gone the pathway of opening different offices in different regulatory jurisdictions in order to better comply with local regulations and have better access to markets in these regions.
South African Forex Brokers
While the Forex market in this region is not a major trading hub like the four big trading sessions, it is the major hub in Africa.
Forex is legal in South Africa as long as it does not contravene money laundering laws, and traders must declare any profits to SARS (South African Revenue Service).
While you do not have to use a regulated broker when trading in South Africa, it is good to ensure your broker is regulated by the FSCA or at the very least one tier-1 regulatory jurisdiction.
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Forex Brokerage Payment Systems
An integral part of Forex trading in countries of the world is the development of acceptable systems of payment.
Credit cards, digital wallets and lately, digital currencies have been developed over the last two decades as means of payment in Forex so as to improve the speed and ease of Forex-related transactions.
These payment methods are designed to make it more convenient for Forex traders to deposit and withdraw funds from their brokerage accounts.
However, not all Forex traders from around the world have been able to access and utilize these payment systems fully.
In many countries, usage of credit/debit cards as well as digital wallets is impossible due to financial blacklisting. For these traders, the bank transfer method remains the only method of transaction.
This method is slow, cumbersome, involves a lot of paperwork and in today’s fast-paced trading, gradually becoming obsolete.
This presents an equality gap which has still not been adequately addressed. There have been attempts to create country-specific e-wallets to address these issues, but these are not widespread and are still limited in scope.
There have to be improvements in this regard.
Some Forex brokers such as AvaTrade are attempting to solve these issues by citing local branches of their Forex business in countries where there is a potential huge market but a dearth of effective payment systems.
The thinking is that if traders in these countries can use local payment methods, then the payment transaction gap can be bridged.
This is an expensive model and has not earned traction among brokers generally.
It is expected that as more fintech companies come into the Forex marketplace, solutions to these problems will be devised and deployed accordingly.
Best Countries to Trade Forex
The best countries to trade Forex are those which fulfil the following criteria:
Have easy access to the major trading hubs, with ability to open Forex trading accounts with brokers in these hubs.
- Countries with good internet systems.
- Countries with a sound technology backbone which can support the placement of servers and systems required to enhance the Forex trading experience.
- Countries with easy and unlimited access to any payment system offered by the Forex brokers.
- Countries that have a solid financial technology presence.
- Countries with no restriction on Forex trading activity.
- Only very few countries can fulfil all the criteria spelt out. However, if a country can fulfil four out of the six listed criteria, it can still be classified as one of the best countries to trade Forex.
Forex trading online is indeed a complex business which goes beyond simply opening an account, funding it and trading with a click of a few buttons on the computer.
A lot of factors come into play.
These have to come together to provide an environment that can support Forex brokers, fintech companies and software providers that deliver access to the market on one hand and Forex traders who constitute the end users on the other.
Traders in some countries will find themselves unable to compete at a particular level with traders from well-developed countries due to gaps in technology, payment access and infrastructure.
But the situation can be managed as companies that have seen these gaps are creating solutions to fill these needs.
For instance, the development of the Forex virtual private server technology is allowing traders in technologically-challenged countries to get above the limitations and still trade as if they were in resource-rich countries.
The Forex market is undergoing continuous evolution, and as the years go by, it is clear that the state of Forex trading in countries will continue to undergo change that will impact their markets.
Forex trading is the biggest financial market in the world, with over 6 Trillion dollars in average daily turnover in 2019.
Due to the high penetration of internet globally, high streaming speeds, technological advancement, and a lot of marketing around Forex to draw in more Forex traders, the Forex trading market has experienced exponential growth.
But with the explosive and continued growth of Forex trading worldwide, the question begged to be answered by many, is Forex trading legal? The answer is yes, and no.
And even when it’s a no, it can be a yes in many instances.
The straightforward answer is that it depends on which country you are trading from.
There are countries that allow Forex trading with no or very few restrictions, while in other countries there are significant restrictions or even a complete ban on foreign exchange trading.
The problem is that because of the nature of the Forex market being open 24 hours a day, 5 days a week around the globe it is very difficult to police.
Most countries around the world allow retail Forex trading by individuals if they work with a regulated broker.
There are a handful of countries that ban or severely restrict Forex trading due to its speculative nature, as well as due to religious beliefs.
Countries allowing Forex trading without many restrictions
Australia
Bulgaria
Canada
Cyprus
Germany
Indonesia
Italy
Malta
Romania
Switzerland
United Kingdom
United States
Aside from these countries, you can also do Forex trading in most South, Central American and Central and Eastern European nations.
Please note: Just because you live in one of these countries does not mean that there are no rules and it’s a free for all.
In the United States, for example, there are regulations to protect a trader from a brokerage deciding to shut its doors and stealing client’s money.
There are also regulations to protect traders from third parties or intermediaries from charging exorbitant fees or get into scams and other financial irregularities.
Banks, which are responsible for the majority of FX trading are heavily regulated.
The U.S. Federal Reserve and the U.S. Treasury Department also closely monitor the Forex markets and look for evidence of foul play or trying to manipulate the market.
There are several regulators working together, as well. The National Futures Association, for example, regulates the Forex market as well as other derivatives markets.
They are the regulatory body that is charge of providing licenses to brokers and of setting and enforcing capital requirements, fighting fraud, or ensuring compliance with reporting and record-keeping.
Regulations like these are different in every country so it is crucial that you become familiar with the regulations in the region/s of the broker you select.
Some countries, for example, allow brokers to offer higher leverage and lower brokerage fees.
A list of Forex Regulators in other Countries
| 🗺️Country | ⚖️Regulator |
|---|---|
| Australia | Australian Securities and Investments Commission (ASIC) |
| Cyprus | Cyprus Securities and Exchange Commission (CySEC) |
| Switzerland | Swiss Federal Banking Commission (SFBC) |
| South Africa | Financial Sector Conduct Authority, (FSCA)(formerly the FSB) |
| UK | Financial Services Authority (FSA) |
| Russia | Federal Financial Markets Service (FFMS) |
| France | Autorité des Marchés Financiers (AMF) |
| Germany | Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) |
| Spain | Comisión Nacional de Mercado de Valores (CNMV) |
| EU | European Securities and Markets Authority (ESMA) |
| United States | Securities and Exchange Commission (SEC) and the National Futures Association (NFA) |
| Japan | The Financial Services Agency (FSA) |
| Hong Kong | The Securities and Futures Commission (SFC) |
A list of Countries allowing Forex trading but heavily restricted
In some countries, it is legal to engage in Forex trading, but there are some restrictions imposed by a central authority.
Some of these countries include:
China
Egypt
Israel
Nigeria
Russia
South Africa
Ukraine
Some restrictions in certain countries include:
In China, it is legal to trade currencies, but you cannot open an account with a foreign broker. You are required to work with a local broker only in order to trade.
In India, traders are also limited to exchanging currencies with the Indian rupee. For example, you cannot trade American dollars with British Pounds.
In South Korea, you cannot open a trading account with foreign brokers, and there is a cap on the maximum leverage that you can use.
In Turkey, it is illegal to have an account with any foreign broker that is not regulated.
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Countries where Forex Trading is illegal and banned
Belgium, the Philippines, Bosnia and North Korea are all countries that have made all forms of speculative and leveraged Forex trading illegal.
Why would countries ban Forex trading? There are two main reasons to justify this. Safety and a fixed currency system.
Forex trading is risky. There are no guarantees, even with the best traders; bad things can happen.
Some estimates indicate that 96% of Forex traders make a loss and quit Forex trading altogether.
Because there is such a high potential for failure especially with traders that aren’t yet experienced, and even then, there is no sure way of ensuring profitability.
On the flip side, some traders can make massive profits, if they have good skills for managing risk and a clear strategy for trading.
The reality, however, is that statistically only 4% of the traders survive in the long term.
Due to the high risk, some countries may ban Forex trading because they think they are protecting its citizens from the high degree of risk and they also may see it as a type of gambling.
Fixed currency rates
There are two types of exchange rate systems that any country can have. It is either a floating exchange rate or a fixed exchange rate.
For countries with a floating exchange rate, the currency varies in value depending on the supply and demand of that currency as driven by banks and traders and other factors.
Countries with fixed currency rates often ban Forex trading. In such a system, the central bank will change the currency’s value to keep it stable.
In these countries, it is banned because where there is no uniform regulations, traders could influence and interfere with currency prices and monetary policies; although this is definitely arguable especially in highly regulated markets.
Also, the more stable a currency is, the less reason to invest since the volatility of currency is how traders make their profit.
Forex trading in Muslim countries with Shariah law
In countries that adhere to Islamic Shariah law, such as Pakistan, there are restrictions on the amount of money that you can trade with a broker, the amount of foreign currency you can keep in a local account, and how you can access Forex for trading.
Since there are so many different rules and regulations within Islamic countries themselves you should consult experts in your country to see if it’s halal or haram (forbidden).
Or you can take advantage of Islamic accounts being offered by brokers to make sure that you are abiding both with your country’s laws and your faith.
In Conclusion
If you are in a country that allows you to import or export money Forex trading is generally legal.
Exchanging your currency for euros so you can have spending money for a holiday or business trip, for example, is a Forex transaction.
When you start to think about the business of trading Forex currencies for profits, however, it is important to keep in mind that trading Forex can be risky.
Every trader must get the education and experience needed to make well-reasoned and strategic Forex trades, or they could lose large sums of money.
For this reason, many countries may heavily regulate Forex trading for individual traders.
In this article we answered the frequently asked question is Forex Trading Legal – South Africa’s Forex Experts weigh in. Experts answered a yes, and no. The straightforward answer is that it depends on where you are.
In South Africa trading is legal with certain restrictions, which is good news as demand for Forex trading continues to surge in 2025.
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Frequently Asked Questions
Are Forex traders legit?
Absolutely! And even those who are only the occasional trader can make a decent income from trading Forex.
In which countries is Forex trading illegal?
In most countries, Forex trading is legal, but there are certain countries where restrictions have been placed on trading and some traders can only operate through domestically licensed brokers.
Is Forex trading legal?
To answer your question, view the opinions of South African forex experts here
Is Forex trading easy?
Trading Forex is incredibly easy, with the right information or the help of an expert broker.
How long does it take to earn Forex?
Realistically, to have a well-rounded understanding of Forex, it can take anywhere from 3 – 6 months to learn Forex. Most traders learn how to trade from experience, in which case it can take up to 1 year.
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