Next, let’s talk about the rules that govern Deriv. To know if you can trust a broker, look at its licences.
With Deriv, it was straightforward to find the answer. As the notice at the bottom of the website says, Deriv has licences from four different agencies:
- Financial Services Authority of Malta (MFSA)
- Financial Services Commission of Vanuatu (VFSC)
- The British Virgin Islands Financial Services Commission (BFSC)
- Financial Services Authority of Labuan (LFSA)
Now, the sheer number of the above regulators can easily convince an inexperienced trader that they’re looking at a legitimate broker, and the Deriv scam couldn’t be further from the truth.
But as you learn Forex laws and get a general idea of how they work, you’ll realise that it’s not all rainbows and sunshine. Trading regulations are the focus of our last section of the Deriv review.
Even though Deriv says it has licences from the MFSA, VFSC, BFSC, and LFSA, we need more proof to believe it.
All of the above regulators come from third-world countries that are not strong in politics or business.
So, you can’t trust them to ensure high financial standards and punish people who break them. Especially since Deriv says it is present in many countries around the world.
Generally, a brokerage should have at least one licence from a Tier-1 regulator to be safe to trade. In Forex, regulators come from many different countries, including the UK (FCA), Australia (ASIC), Cyprus (CySEC), and Germany (BaFin).
Now, you’d want your financial security to be in the hands of these regulators, not the third-level bodies that can’t even control their subjects within the country’s borders.
Are Deriv Promotions Trustworthy?
We will conclude our analysis of the Deriv Forex broker by discussing its trading regulations. We’ll talk about everything, from the instruments that can trade to the rates of commission and the leverage ratios.
During our review, we found that Deriv has more than 100 assets that can trade. These assets fall into four categories:
- Stock indices
- Commodities, bitcoin price prediction 2025
- Indexes that are made up of stocks
Deriv also lets you trade binary options, which could be seen as a plus, but only under stringent rules.
Before we go any further, two things hurt the credibility of Deriv: synthetic indices and binary options. You can trade and get these two riskiest assets from a broker.
A synthetic index is an asset that follows simulated changes in the market that are said to be made by random software. And because the algorithm is lucky, the broker doesn’t get anything out of it. In reality, however, brokers tend to change the algorithm and make it into a gambling machine where the odds always favour “the house.”
Regarding binary options, it’s already known that most options trading brokers are frauds. Because options are either all wins or all losses, it’s much easier to lose than to win, and the brokers have much to do with this.
Next, let’s talk about the rules that go along with these assets. During our Deriv review, we saw that the most leverage you can get is 1:1000, which is way too high for a safe zone. With that much leverage, it’s easy to lose your whole account in just a few trades.
Deriv also says, strangely, that it doesn’t charge spreads and that the only fees it charges are instrument fees starting at 0.015%.
When we see a broker with what seems to be meagre commission rates, we always think that it has hidden fees or even fake ways to make money. And it’s not an exception at all with Deriv.
Should You Use Deriv To Trade?
So, after all we’ve discussed in this review, should you trust Deriv with your money? If you trade with this broker, will you be safe?
Well, it doesn’t seem like the best move for a Forex broker to give up the informational part of its website for pretty decorations.
The regulatory claims follow the same pattern: Deriv is said to have four separate licences, but they need to improve at keeping an eye on what the broker does.
And when it comes to trading terms and conditions, our suspicions about the Deriv scam are growing. Because of this, we can’t recommend that you trade with this broker.