Will the 10% confiscation of client funds at Cyprus banks also apply to Cyprus FX brokerages?
Before we start (or contribute to an existing) panic among clients of Cyprus-based FX brokerages, we would like to state at the outset that we have been told directly by senior management at several leading Cyprus-based FX brokerages, that all client money at Cyprus FX firms is completely safe, and there will be no haircuts or confiscation whatsoever in client funds.
That being said, Saxo Bank founder and co-CEO Lars Seier Christensen posted a scathing piece on Saxo Bank's TradingFloor.com research and commentary website (also available in LeapRate's FX Research section) blasting the general confiscation idea, which also questioned: "What is the exact impact on any client deposits they might be holding in Cyprus [FX brokerages]? I would assume that most funds are held abroad with major FX counterparts, not Cyprus banks, but clarification of this aspect would be useful."
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