Magic Compass, Lydya Financial get licensed by Cyprus’ CySEC

Magic Compass, Lydya Financial get licensed by Cyprus’ CySEC

- in All News, Regulation
CySEC

The Cyprus Securities and Exchange Commission (CySEC) has granted a Cypriot Investment Firm (CIF) license to Magic Compass Ltd., and Lydya Financial Ltd., according to data published on the regulator’s website.

Magic Compass obtained a license on 12 April, while Lydya Financial got licensed on 22 April. Neither of the two licenses have  non-activated status.  

Magic Compass CySEC license

Under the regulation, the CySEC grants a non-active CIF license, which, after certain requirements are met, receives an active status. Until that time, the licensee is not allowed to provide financial services. To make the change, the regulator requires companies to meet certain conditions.

The Cypriot financial regulator provides two types of CIF licenses – limited and full. A limited license allows an entity to execute orders on behalf of clients, but not on its own account, while full license allows an entity to act on both its own behalf and that of clients. Lydya Financial CySEC

Financial service providers are not allowed to lawfully operate in Cyprus unless they hold a license by the CySEC or the relevant authorities in any other EU member state. A CySEC license, on its part, provides access to the rest of the EU market.

To obtain a CIF license, companies need to meet a number of requirements, which are sometimes more harsh than in other countries. They need to present an initial capital of at least €200,000 for limited license or €1 million for full license. The watchdog exercises strict supervision over the markets in its jurisdiction. A CySEC license makes a broker appear more secure and attractive to traders.

CySEC regulation is preferred by many financial companies, forex and binary options brokers included. The watchdog licenses, supervises, and regulates players on the local capital market. The CySEC’s managing board consists of five members, each one of which serves a term of five years.

It has licensed more than 200 CIFs, including forex brokers FxPro, XM, FXTM, Trading 212, EXNESS, Hot Forex, and IronFX, among others.

Source: CySEC

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