Across the financial market, the last decade has been a period of rapid growth. While traditional sectors such as stock and futures trading saw fluctuations–some of them of significant magnitude – newer areas like digital moneymarkets blanked. These are fast-changing environments that attract waves of retail and institutional participants, often overwhelming the existing supervisory structures. When this happens, supervision is essential, and that’s why obtaining a CySEC STP license in Cyprus has increasingly become the best deal for brokers looking to offer fully-compliant services to EU countries. For any serious Cyprus STP broker, this license provides the foundation for scalable, regulation – driven growth. As markets ditch old means of communication and move to digital first operations, regulatory clarity is no longer an option-it’s now a competitive edge.
Regulation of the Forex Trading Industry
Forex companies, too light-touch brokerage houses, regulation has failed to keep up with the times. These days, forex companies-cum-investment firms/brokerage houses are sprouting up all over, from secluded desert islands to Caribbean heavens.
In particular, the vast majority of retail traders are entirely dependent on their own leeches for daily living expenses. It is either that an individual investor or institutional money feeds them, or two organizations pool money together—which they then invest as a single entity. There can be no engine of change in this world.
Oh, what an age we live in! A third of traders have doubts when they step into this field and congregate at regular intervals to learn from masters; this sets up the framework for later-term safety thinking.
- CySEC Supervision
The company is supervised by CySEC, Cyprus’s top financial institution, and operates in compliance with the MiFID II directive. This guarantees a high degree of investor protection, transparency, and regulatory standards in every operational aspect. - CIF License
The company holds a Cyprus Investment Firm (CIF) license allowing it to provide primary investment services, including order execution, portfolio management, and investment advice. - STP Execution Model
With an STP license, all client orders are routed straight to liquidity providers, sidestepping the internal dealing desks that are characteristic of market-making firms. This type of model significantly reduces a firm’s conflict of interest, making it more transparent for clients who follow trades and can see exactly where the money goes during one of those slow situations. - Payment License
The company holds Payment Institution Cyprus status, allowing it to operate client funds and arrange payments under CySEC’s control.
Investor Protection Under MiFID II
Investor security is provided in serious measure by MiFID II regulated licensed firms. This includes things like segregation of client funds, capital reserves, transparent reporting mechanisms, and strong internal controls. This engenders trust, shifting responsibility for investors’ monies to the authorized entity. The individual no longer has to shoulder the burden of risk management of his own accord.
CySEC Overview
The body responsible for investment companies in Cyprus is CySEC. By law, Cyprus Investment Firms must be officially licensed before they can perform any of the following services:
- Investment advice
- The reception and transmission, as well as the execution, of orders and instructions for one or more of the following financial instruments:
- Placing of financial instruments on a firm commitment basis
- Issuing of financial analysis and research reports
- Portfolio management
- Services related to the operation of the physical market places for any of the following financial instruments:
- Money market instruments
- Foreign exchange
- Financial futures and options
- Exchange and interest rate instruments
- Transferable securities
- Other negotiable instruments
- Safekeeping and administration of the custodian of assets for individual or company funds.
There are various levels of these licenses:
- Simple License – Requires a minimum capital amount of €50,000. This license permits consulting but does not allow the firm to hold securities or manage them for the client.
- STP License – Requires a minimum capital deposit of approximately €150,000, enabling a company to hold and manage customer funds.
- Issuer License (IPO) – Requires about €250,000 in regulatory own funds and additional cash for the equity push. The license, along with its MIFID passport, also brings a significant uplift in capital and profile. A Cypriot exchange license takes about €400,000 to complete.
- RA License – Capitalization is based on the type of business. Currently, only STP and payment licenses are available jointly.
However, we can accept other business models if it makes financial sense for everyone involved and can help with costs.
Operational Setup
- Clean Compliance History
The firm has maintained a spotless track record with no regulatory infractions, complaints, or sanctions, ensuring confidence for potential buyers and investors.
- Infrastructure Ready
Fully operational with a physical office in Limassol, the firm is staffed by qualified directors and team members who meet CySEC’s “fit and proper” requirements. It also includes a live white-label MT4 trading platform and integrated corporate banking and PSP relationships.
- EU Passporting Rights
Enjoy passporting rights to 23 EU and EEA countries, enabling the provision of services across the single market without additional regulatory approvals.
Challenges and Opportunities for CySEC Application
The licensing process at CySEC is known for its meticulous nature. Applicants are required to provide clear and well-documented information. Incomplete applications or incorrect details are the primary reasons for complaints and rejections. If the documentation lacks clarity or is missing, CySEC may request additional information, resulting in a prolonged approval timeline, or in some cases, outright denial.
The area of Business Process Re-engineering (BPR) differs from the review process and encompasses a range of activities including operational setup, order execution systems, marketing strategies, and compliance workflows. Additionally, agencies collaborate with prototypes to enhance their processes.
Acquisition Opportunity
Currently, there exists an exceptional opportunity to buy CIF Cyprus that holds both STP (Straight Through Processing) and Payment Institution licenses. Established in 2022, this firm boasts a robust business model without bureaucratic hurdles, which has garnered it favor with CySEC. Notably, CySEC has conducted investigations without cause, indicating the firm’s solid standing.
When you acquire this CIF, you receive:
- CySEC-Approved CIF: Active since 2022, this firm has maintained a flawless compliance record.
- STP Brokerage Model: This model eliminates internal dealing conflicts, allowing trades to be sent directly to liquidity providers.
- Complete Infrastructure: The enterprise features:
- A corporate structure compliant with CySEC regulations
- Segregated bank accounts
- A live website
- A white-labeled MT4 trading platform
- A team of three experienced personnel, all certified by CySEC
- Payment services capability, either through an existing PSP or readiness for licensing as a Payment Institution.
- Income Potential: Depending on trade volume and monthly overhead, the income can range from €25,000 to €45,000 monthly.
Pricing Information
The market value for a licensed, operational CIF with STP and Payment licenses typically ranges from €900,000 to €1.5 million. This valuation is influenced by various factors including infrastructure, revenue, and regulatory standing.
Conclusion
This investment represents more than just an empty brokerage shell; it is a live, regulated investment firm with real customers, an impeccable compliance history, and solid structural foundations. The STP model aligns operational success with client interests, ensuring transparent and conflict-free execution. With a single license, you can operate throughout Europe without obstacles.
Unlike other CIF brokerages available in Cyprus, this company offers a strong income stream and is primed for future growth. If you are ready to explore this opportunity further, we welcome a confidential discussion.
What is the capital requirement for CIF STP?
The minimum regulatory capital is usually €125,000. However, if the firm holds client funds directly, the requirement may increase commonly up to €150,000 to represent additional risk and operational requirements.
Is CySEC regulation passportable in the EU?
A CySEC license offers full passporting rights under MiFID II, enabling a firm to provide services in all of the member states of both the EU and EEA without further licenses being needed.
How much does it cost to acquire a CIF with both STP and Payment Institution (PI) licenses?
A fully licensed and operating CIF with STP and PI permissions can typically hold a market price tag of anywhere between €900,000 to €1,500,000 depending on the firm’s set-up, infrastructure, and regulatory history.