Forex has been the domain of London, New York, and Tokyo for as long as memory serves, but ambitious nations are hoping to upset the balance. In April, Singapore brought this trend into sharp focus with its $225m investment in latency technology, designed to bring down forex trade speeds and make the country a more lucrative trading center. These countries looking for an edge are continually adopting smaller innovations like this one, and the scaling up of cryptocurrency may be the next big measure to gather international interest.
The reason new technology can flourish in countries like Singapore is partly down to the lower levels of regulation. Western countries are, rightly or wrongly, concerned with keeping financial services in check, whereas there is sometimes a more pervasive environment for new ideas elsewhere. This is important, for both forex and cryptocurrency. As ConnectFX notes, high-quality brokerages and exchanges are important to developing market growth. Indications are that the brokerages opened around the world have generated new interest in crypto, with CNN reporting that the likes of JP Morgan and Goldman Sachs are now actively involved in cryptocurrency development.
Bringing technology offline
A question that has frequently weighed over the head of the crypto and, indeed, forex, is its real-world application. With cryptocurrency, it can be easy to dismiss coins as a digital currency with little application; and with forex, it’s easy to get lost in the numbers. Addressing this and creating a real-world application of coins has helped to elevate the UAE in its international crypto ‘standings’, partly through the use of cryptocurrency vending machines. According to the Abu Dhabi national, these offer enthusiasts a way to purchase and exchange digital coins in a real world and real-time setting.
Crypto and forex being pushed out
Permissive environments allowed bitcoin and its sibling coins to grow, but indications are that these environments are being phased out. China, in particular, has signaled it’s intent to phase out industrial coin mining entirely, in line with the plans of the national state planning agency. In a country that also allows forex trading but can impose arbitrary controls, business is being squeezed.
Whereas this is bad news for the sheer volume of coins available, it presents opportunities and resources – especially in the surrounding region. This will allow the likes of Taiwan, Hong Kong, South Korea and India, which, according to Investopedia, hold forex reserves within the top 10 of the world, to make an impact. With technology following closely behind, it’s not unthinkable that these rapidly developing economies will have a huge part to play with the forex climate if they look to move towards progressive legislation.
Forex is being developed at a rate of knots by countries unrestricted by the same laws as those in the old forex centers. With cryptocurrency a huge weapon in their arsenal, new forex centers will start to become a reality. With these new centers, cryptocurrency accepted and used to their advantage.