FX and stock trading platforms need zero vulnerability to cyber risks

Over 43 per cent of FX traders are millennials of 25-34 years. As digital natives, they are comfortable with new tech and expect their user experience to be personalized, smooth sailing and hassle-free.

This generation demands slick onboarding, an app and easy-to-use deposit and withdrawal processes - but without compromising watertight security. The latter factor is particularly important – and is a significant challenge for fintech operators – with the scale of this issue becoming bigger than ever before.

Cybercriminals are taking advantage of the interconnectedness of the digital economy and digital finance platforms to target traders accessing multiple financial markets across multiple asset classes. Reports expect global cybercrime costs to grow by 15 per cent per year over the next three to four years, reaching $10.5 trillion by 2025, up from $3 trillion in 2015.

Careful with the platform

Cyber-criminals are targeting trading platforms to access the brokers’ client records. To address the latter concern, FX traders need to choose a regulated platform and operate in a transparent setting to act more diligently when responding to the fallout from a cybersecurity threat. Traders wanting the safest platforms should look out for those governed by a robust regulatory and compliance framework and that adhere to the strictest standards of client onboarding. However, the challenge is one of cat and mouse – cybercriminals are always evolving.

The scale of the challenge should not be underestimated. In January, more than $80 million of digital assets were stolen from a decentralized finance platform when a blockchain extension by Qubit Finance, a DeFi lending firm, was exploited by a hacker. Qubit wrote an open letter to the person responsible - offering a bounty of as much as $250,000 and requesting to negotiate the return of lost funds that affect ‘thousands of real people’.

Stringent measures

Trading platforms have a vested interest in ensuring that due diligence is mission-critical irrespective of the ease of onboarding. Therefore, consistent, real-time support and guidance are especially important for FX or stock traders because of the speed with which transactions happen – and the ever-changing behaviors of cybercriminals.

For example, at 4T, free 24/7 support, a free CFD trading guide and risk management advice provided are designed to help individual traders recognize threats, inform them of cybercrime risk and help to manage risk to maximize returns safely. But safety isn’t just about avoiding crime - it is also about behaviour - because one of the greatest dangers is overconfidence, carelessness and a lack of awareness. Trading platforms are easy to use by design.

Responsible access

Access is made even easier with instant automated onboarding. But with access comes responsibility from both the provider and the trader. The platform needs to ensure that those trading on it are armed with insight, analysis and advice. If traders are kept up to speed with what is happening in the financial markets, and if they are given personalized guidance during every step of their trading journey, they are far more likely to be able to make measured and informed choices.

With the losses from crypto-related crime reaching a record $14 billion in 2021 - a 79 per cent annual rise – the next-generation trading platform has to create and maintain a digital trading environment that delivers everything the millennial expects. Moreover, new traders need to feel secure, supported and helped so that as they gain confidence, they are equipped with the tools they need to realize their financial goals in a safe and supporting ecosystem. Millennials rightly expect nothing less.