Deriv is a popular trading platform that offers a wide range of financial products such as forex, commodities, and cryptocurrency. It has gained a significant presence in the global market and is known for its user-friendly interface and advanced trading tools. However, many traders residing in the United States have raised questions about the availability of Deriv in their country. In this blog post, we will delve into the various aspects of Deriv's availability in the USA and provide valuable insights for traders who are interested in using this platform.
Deriv's Presence in the American Market
Since its inception in 1999, Deriv (formerly known as Binary.com) has expanded its services to over 100 countries worldwide. However, it is worth noting that the company does not operate in certain jurisdictions, including the United States. This is due to strict regulations imposed by the US government on online trading platforms. Despite this limitation, Deriv has managed to establish a strong presence in the American market through its affiliate partnership program.
Deriv's affiliate program allows traders from the US to introduce new clients to the platform and earn commission based on their trading activity. This has enabled Deriv to tap into the vast potential of the US market while complying with regulatory requirements. As a result, many US-based traders have become familiar with Deriv's brand and services, even though they cannot directly trade on the platform.
Legal Framework for Deriv in the USA
The legality of Deriv's operations in the United States is a complex issue due to the country's strict regulatory framework for financial services. The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are the main regulatory bodies responsible for overseeing trading activities in the US. These agencies have stringent rules in place to protect consumers and ensure fair trading practices. As a result, any foreign trading platform looking to operate in the US must comply with these regulations.
Deriv has not obtained a license from either SEC or CFTC, which prevents it from directly offering its services to US traders. This is because Deriv's offered products fall under the category of binary options, which are considered high-risk investments by US regulators. As a result, Deriv has been restricted from targeting US traders and advertising its services within the country's borders.
Accessibility of Deriv Platforms for US Traders
While US traders cannot directly access Deriv's trading platforms, there are still ways for them to trade on the platform. One option is to use a Virtual Private Network (VPN) to bypass the geo-restrictions and access Deriv's website. However, this is not a recommended option as it violates the company's terms of service and can result in account suspension.
Another option for US traders is to register with an offshore broker that offers Deriv's services. These brokers are located outside the US and are not subject to the same regulatory restrictions. However, traders need to be cautious when choosing an offshore broker as some may not be legitimate. It is essential to thoroughly research the broker's reputation and regulatory status before depositing funds.
Restrictions and Limitations on Deriv Trading
Even though US traders can access Deriv's platforms through alternative means, they are still subjected to certain limitations and restrictions. For instance, they may not be able to deposit or withdraw funds using their local currency. Additionally, the range of financial products available for trading may be limited compared to what is offered in other countries. This is due to regulatory requirements imposed on the broker by the country where it is registered.
Moreover, traders from the US may not have access to certain features and tools that are available to traders from other countries. This could potentially put them at a disadvantage in terms of trading strategies and decision-making. It is essential for US traders to thoroughly understand these limitations before using Deriv's services through an offshore broker.
Future Prospects for Deriv in the US
Despite the challenges and restrictions, there is still potential for Deriv to establish a direct presence in the US market in the future. The company has expressed interest in obtaining a license from SEC or CFTC, which would allow it to offer its services directly to US traders. However, this process could take some time as the regulatory requirements are stringent, and Deriv will need to comply with them before being granted a license.
Another factor that could potentially impact Deriv's presence in the US is the changing landscape of online trading regulations. With the rise of cryptocurrency and other digital assets, regulators may revise their policies to accommodate these new financial products. This could create opportunities for Deriv and other similar platforms to enter the US market and expand their offerings.
Impact of US Regulations on Deriv
The strict regulations imposed by the US government have undoubtedly affected Deriv's operations in the country. It has limited the platform's growth potential and prevented it from reaching a significant number of potential traders. Additionally, the constant changes in regulations and compliance requirements can also be a burden for Deriv and other trading platforms looking to operate in the US.
On the other hand, US regulations have also played a crucial role in protecting consumers and promoting fair trading practices. As a result, traders who do use Deriv's services through alternative means are at least assured that they are dealing with a regulated entity. This adds a layer of security for US traders and ensures that their interests are protected.
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Options for US Traders Interested in Deriv
For traders residing in the United States who are keen on using Deriv's services, there are a few options available. As mentioned earlier, one option is to use a VPN to access Deriv's website and register for an account. However, this is not a recommended option as it goes against the company's terms of service and can result in account suspension.
Another option is to register with an offshore broker that offers Deriv's services. This allows US traders to access Deriv's platforms and trade on their preferred financial products. However, this option comes with its own set of limitations and risks, as discussed earlier. It is important for traders to thoroughly research the broker before committing to any investments.
Lastly, US traders may choose to explore other trading platforms that are available in the country. There are several reputable brokers and trading platforms that are licensed and regulated by SEC and CFTC, providing a safe and reliable option for trading.
Comparison of Deriv to Other Trading Platforms in the US
For traders residing in the United States, there are numerous options when it comes to choosing a trading platform. Each platform may have its unique features, advantages, and disadvantages. Let us take a look at how Deriv compares to other popular trading platforms in the US.
Deriv vs. Nadex
Nadex is a US-based binary options exchange that is regulated by CFTC. It is a direct competitor to Deriv as both platforms offer similar products and services. However, Nadex is exclusively available to US residents, while Deriv is available in multiple countries. Additionally, Nadex has a limited range of assets available for trading compared to Deriv.
Deriv vs. FOREX.com
FOREX.com is a popular online trading platform that offers forex, commodities, and cryptocurrency trading. It is one of the few brokers that have obtained a license from CFTC, making it a trusted option for US traders. On the other hand, Deriv is not subject to US regulations and does not have the same level of trust among US traders.
Deriv vs. TD Ameritrade
TD Ameritrade is another well-known trading platform that offers a wide range of financial products. It is licensed by SEC and CFTC, making it one of the most reputable brokers in the US. However, TD Ameritrade does not offer binary options trading, which is one of Deriv's main offerings.
Expert Insights on Deriv's Availability in the USA
To gain a better understanding of Deriv's availability in the United States, we reached out to industry experts for their insights. According to Bob Langley, a financial analyst at Forex Academy, "Deriv's presence in the US market has been limited due to regulatory requirements. However, there is still potential for the platform to expand its services in the country through partnerships or obtaining a license from SEC or CFTC."
On the other hand, Michael Greenberg, founder of Finance Magnates, believes that "the current regulatory framework in the US poses significant challenges for Deriv and other offshore trading platforms. Until there are changes in these regulations, it will be difficult for Deriv to establish a direct presence in the US market."
Conclusion
In conclusion, Deriv is not currently available for direct trading in the United States due to strict regulations imposed by the government. However, the platform has managed to establish a strong presence in the US market through its affiliate partnership program. Traders residing in the US who are interested in using Deriv's services can explore alternative options such as using a VPN or registering with an offshore broker. While there are limitations and risks involved, there are still opportunities for US traders to access Deriv's platforms and trade on their preferred financial products. As for the future, it remains to be seen how regulatory changes and shifts in the online trading landscape will impact Deriv's potential for growth in the US market.
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