Many people in the Maldives have received requests on social media that turns out to be a Forex scam. The Forex is a market where people can buy, sell, exchange and speculate on different currencies of the world. These include banks, commercial companies, hedge funds, investment management firms, brokers and investors. However, people are wondering whether Forex is a legitimate market and if participants truly benefit from it.
Although Forex trading has been around as long as has international commerce, modern Forex trading began in the early 1970s when the U.S.A. allowed its currency to float freely in the Forex market, according to Daily Forex. Forex trading is legit and people actually make profits, but Forex gets a bad reputation due to several scams that are associated with it.
Photo credits: Forexop
When the Forex market first became available to retail traders, the most common scam involved brokers who would collect fees from customers and then simply disappear. However, these days, a popular scam is known as the Signal Seller Scam. Individuals or companies claim to have expertise on the perfect time to make trades and then make money by getting unsuspecting traders to pay them for their expert trade advice.
Another scam is known as the ‘robot scam’, which emerged with the increased use of AI. This involves individuals who claim they have developed software that can generate automatic trades at the perfect time, ensuring an optimum profit. The scam artists make money by selling this software to unsuspecting traders. However, Forex can be highly profitable, with a total trade volume of around $5 trillion every day.
In order to avoid being scammed, it is important that there’s enough knowledge of the market and other factors. For instance, check whether the broker is regulated and decide how trustworthy the regulatory body is.
