Every seller needs a buyer, and vice versa, and with the phenomenal rise of retail foreign exchange (FX) trading came the increase of online brokers and market makers to deal with demand. At first the model was simple: the large FX banks fed prices to retail aggregators, which added a margin and trading tools. But as the market grew, so did the number of retail FX firms coming to the market with improved technology and algorithms that enabled them to make their own prices.
The agency and market making models used in retail FX trading have continued to exist side by side. The trend seems to be veering towards the less traditional model and towards the high-tech online platforms, where all trades are executed instantaneously with no human intervention.
