The Cypriot regulator on Thursday has warned against entering into transactions, particularly involving contracts for difference, cryptocurrency and forex-trading, via online trading platforms operated by unlicensed providers.
The Cyprus Securities and Exchange Commission said before that some of these illegal brokers were just spinoffs of previously shuttered companies while others misleadingly claim affiliation other brokers that are already regulated in Cyprus and hold its CIF License. The watchdog has blacklisted the following domains:
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It stresses that these firms are not licensed to do brokerage business in Cyprus, nor are they affiliated with a regulated entity. And, it warns that if consumers lost their money on platform are not licensed, they are not protected under the Investor Compensation Fund (ICF), which serves to protect the claims of covered clients and provide them with compensation in case a member couldn’t meet its financial obligations. Earlier last year, the CySEC has changed maximum compensation for valid claims to be either 90 percent of the cumulative covered claims or €20.000, whichever is lower.
On the crypto front, thе Cysec hаѕ ѕееn іtѕ ѕhаrе оf unlісеnѕеd fіrmѕ соntіnuіng tо ореrаtе wіthіn thе соuntrу, thefore thе аuthоrіtу hаѕ аlrеаdу bеgun tо mоnіtоr аnd аѕѕеѕѕ сrурtо соmраnіеѕ аnd thеіr rеѕресtіvе асtіvіtу.
The Cypriot watchdog revealed in 2019 details about its efforts to regulate crypto assets, hinting more discussions might already be underway. The CySEC increased oversight of cryptocurrencies and related assets by integrating EU anti-money-laundering rules into the Cypriot laws.
While many providers claim to be Cyprus-based, the CySEC said previously it believed such companies were based overseas and providing false addresses, adding that it would look into taking further action if companies were actually based within the country. It further explains that it is sometimes hard to find the names of the platforms’ operators on their websites and that the addresses given as the company headquarters are often offshore letterbox addresses.
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