Is Olymp trade banned in USA? (2024)

Olymp Trade is one of the most popular online trading platforms, providing access to financial markets for millions of users worldwide. However, its legal status has been frequently questioned by users in the United States. This article will analyze whether Olymp Trade is allowed to operate in the US and if US citizens can legally use it for trading.

Olymp Trade Overview

Olymp Trade is an international brokerage company founded in 2014 and headquartered in St. Vincent and the Grenadines. It offers trading services in forex, commodities, stocks, and cryptocurrencies through its web and mobile trading platforms. Traders can speculate on the prices of assets going up or down and earn profit depending on the accuracy of their predictions.

Some key features of Olymp Trade include:

• Easy account opening with low minimum deposits ($10)
• Intuitive web and mobile trading platforms
• Availability of demo accounts for practice trading
• Option trading with short expiry times (from 60 seconds to 3 hours)
• Educational materials and analytics tools for beginner traders
• Support in over 20 languages including English, Spanish, Portuguese, Chinese etc.

Olymp Trade claims to have over 25 million registered users from across the world as of 2020. However, it does not hold any regulatory licenses to operate within the United States.

Regulation of Olymp Trade in USA

Olymp Trade is owned and operated by Smartex International Ltd which is registered in St. Vincent and the Grenadines. This offshore jurisdiction does not require financial companies to hold trading licenses.

The Commodity Futures Trading Commission (CFTC) and the Securities Exchange Commission (SEC) are the main regulatory bodies overseeing financial markets in the United States. They require all companies offering trading services to US citizens to be properly licensed and registered.

As Olymp Trade does not hold any licenses from the CFTC or SEC, it is considered an unregulated broker in the US. Unregulated brokers are prohibited from soliciting US traders or providing access to US-based trading platforms and exchanges.

Can US Citizens Legally Use Olymp Trade?

Despite being unregulated in the US, Olymp Trade's website and trading platforms remain accessible to US citizens. Thousands of traders in the US have managed to open accounts by providing non-US residence information.

However, according to US laws, citizens are prohibited from using offshore unregulated brokers for options, forex, and commodities trading:

• The CFTC requires brokers to have a license for soliciting US customers for derivatives trading like forex and commodities. Olymp Trade does not have such a license.
• SEC rules prohibit the offering of security-based options to US customers without SEC registration. Olymp Trade only provides short-term options trading.
• NFA guidelines also restrict working with international brokers who are not regulated by CFTC or SEC.

Therefore, US citizens who use Olymp Trade are essentially violating the country's trading regulations. If caught, they can face significant penalties including fines and trading bans. The CFTC has pursued legal action against US citizens illegally using other offshore platforms like BFM Markets in the past.

Why is Olymp Trade Not Regulated in the US?

There are a few reasons why Olymp Trade chooses to remain unregulated in the US while operating legally in other jurisdictions like the EU:

• Expensive compliance costs: Getting US licenses requires brokers to maintain very high regulatory capital, implement robust reporting procedures, and frequently file documents. This adds substantial operational costs.
• Complex regulations: CFTC and SEC rules contain complex proprietary trading restrictions, disclosure requirements, and leverage limits that can impact platforms designed for active trading and high leverage like Olymp Trade.
• Risk of penalties: The US regulatory environment is quite strict. Even minor violations can result in hefty fines or trading bans making operations very risky for offshore brokers.
• Limited scope: Options and forex trading make up a large portion of Olymp Trade's offerings. These cannot be legally offered to US citizens without CFTC/SEC regulation.
• Sufficient business elsewhere: Olymp Trade has managed to build a large international user base from Asia, Europe, Latin America etc. It likely doesn't see the compliance costs of entering the US market worthwhile as yet.

So in essence, the regulatory and operational challenges involved make it difficult for platforms like Olymp Trade to get regulated approval in the United States at this stage.

Conclusion

In summary, Olymp Trade continues to remain an unregulated trading platform in the United States as it does not hold any licenses from the CFTC or SEC. As per US laws, citizens are prohibited from accessing offshore brokers for options, forex and CFD trading. Those who use Olymp Trade are technically violating these laws, despite the platform remaining accessible. Olymp Trade itself prefers to stay offshore to avoid complex US regulations, compliance costs and penalties from potential violations. Unless Olymp Trade gets appropriate licenses to operate in the US in the future, citizens need to exercise caution while using its services or evaluate regulated alternatives for their trading needs.

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