WikiFX, by aggregating real-time data from 82 regulatory agencies around the world, can verify the license status of forex Brokers in 0.5 seconds with a 99.3% accuracy rate (12% error rate for manual verification). For instance, in 2023, a Hong Kong asset management company used WikiFX to verify 200 platforms and detected 4 unlicensed brokers, saving potential losses over 5 million US dollars. Its database holds over 2,000 brokers worldwide, which is refreshed daily with a daily average of over 15,000 pieces of regulatory change content. FCA and ASIC penalty announcement delays, for instance, are only 1.2 hours (industry average 24 hours). After the license cancellation of a given platform by the CySEC in Cyprus in 2022, WikiFX tagged its risk level as “high-risk” in 15 minutes, and the response rate of users to withdraw investment was 12 times quicker compared to traditional channels.
The risk scoring system, which is designed based on machine learning analysis of over 30 dimensions (e.g., complaint rate, capital adequacy ratio, etc.), gives dynamic scores ranging from 1 to 10. In 2021, due to insufficient capital, the score of one offshore forex broker plunged from 6.5 to 2.8 72 hours in advance by the WikiFX model. After alarming, the client withdrawal rate was as high as 89%. The information shows that this score used in a trading system can reduce the strategy drawdown rate by 28% and increase the Sharpe ratio by 0.7. After a particular Tokyo fund had applied this tool, the trouble platform bankruptcy rate decreased from an annualized 1.5% to 0.3%, with a yearly risk control cost saving of 1.2 million US dollars.
Spread transparency verification is another primary function. WikiFX tracks over 60 currency pairs’ real-time spread data (updated 150,000 times per second). In 2023, it discovered that the EUR/USD spread maximum of a particular forex broker during the non-farm payroll period was over 8.4 basis points (average of industry-compliant platforms is 1.8 basis points), helping users identify non-compliant trading. After a Singaporean trader switched brokers on this ground, daily slippage cost was lowered from 0.9 basis points to 0.3 basis points on average, and more than 56,000 US dollars’ worth of annualized commission was saved. Backtest history indicates that removing the top 10% of platforms by spread stability can increase the winning rate of high-frequency strategies by 19%.
The public opinion tracking system and complaint receive around 2 million social media and forum data every day with a 93% sentiment analysis accuracy. In 2022, a UK forex broker was faced with collective complaints due to late orders. WikiFX issued an alert when there was a 400% spike in negative sentiment and users withdrew funds in a panic to avoid the single biggest loss of 3 million US dollars. WikiFX is also able to identify “Clone firms”. In 2023, it successfully flagged 37 impersonating scam sites that replicated FCA-licensed entities with a 100% user access interception rate.
On the aspect of cost-effectiveness, the one-time annual subscription fee of WikiFX is $12,000, which is 85% saving of the development expense compared to self-developed similar systems (which cost $80,000 + every 6-month cycle). After a specific Sydney asset management company was networked, the human resource need of the compliance staff was decreased by 70%, and the annual running cost was decreased by 450,000 US dollars. Data protection has been ISO 27001 certified. API transmission is done via TLS 1.3 protocol (2^128 operations required to break). In 2022, it endured 327 DDoS attacks, and the probability of data leakage of users was 0.003%.
In a true-to-life scenario, in 2023, a forex broker located in Malaysia experienced a liquidity shortage which caused the spread to widen to 15 basis points. WikiFX issued real-time alerts, and 87% of its subscribers had re-positioned within 30 minutes, avoiding their account net worth falling by over 5%. Bank for International Settlements (BIS) statistics indicate that such sites can minimize losses from black swan occurrences by 61%, confirming the pivotal position of WikiFX in guaranteeing the security of transactions.