HISTORY OF FOREX TRADING
By Seputar Dunia Forex • Posted in FOREXPEDIA
Around the 90’s. The history of forex trading notes that those who did the forex trading business at that time were only the rich or jetsetters, banking financial institutions, government parties and large companies. Forex trading at that time was mostly done for trading purposes, hedging, investing and even as a medium for paying debts. At that time, forex trading can only be done with large capital so not everyone can get involved in forex trading activities as it is today.
After entering the late 90s when internet technology began to develop, forex trading began to be designed and developed on a large scale so that it could involve everyone to actively participate in the world of online forex trading . Forex brokers are starting to design their trading platforms so that they can be used by everyone individually in forex trading. And give everyone the opportunity to be involved in the world of forex trading without any limitations of place and time.
HISTORY OF CURRENCY EXCHANGE
The barter system has been known for a long time in the history of human civilization. In ancient times, by bartering between needed items, everyone would be able to fulfill their own needs. However, over time with the development of the level of human knowledge, the barter system experienced difficulties over agreement in determining the value of an item that was exchanged for other goods, until each nation began to create its unit of exchange value in accordance with the conditions in their respective territories with using items that are considered to have the most valuable value and are easy to carry everywhere such as gold, silver, beads, rare stones etc.
Because each region at that time used a different currency, a reference unit of value in the form of a currency that could be accepted by all nations across continents was set as a whole, so at that time it was agreed that gold and silver were a form of mediation on the value of the world’s main currencies. .
At that time, every existing kingdom began to make its own currency using gold and silver with levels and weight determined by each kingdom itself. So, that rate is then the basis for currency exchange. It was at that time that the era of ancient currency exchange began.
More precisely in the records of the Byzantine era (circa 4th century BC), provide traces of clues that the kingdom began to monopolize currency exchange. Then in Papyrus records also seen the existence of currency exchange activities in the era of ancient Egypt.
HISTORY OF MODERN FOREX TRADING
After the world war ended there was chaos and global economic crisis. At that time the allied countries began to discuss a system that could restore and unify the global economy. Then, was born a system called the “Bretton Woods System” .
In 1944, a Breton Woods System was born in the town of Bretton Woods, in the state of New Hampshire, United States. At that time, for the first time the official rules governing the monetary system between countries were enacted. The United States, which at that time had gold reserves up to two-thirds of the world, forced its will that every currency in the world was based on gold and the US dollar. So that all countries are required to link each currency to gold and the US dollar.
The Bretton Woods agreement then did not last long. On August 15, 1971, the United States unilaterally severed its relationship with gold, at which point the Bretton Woods system automatically ended. Since then, the US Dollar has become a reserve currency for all countries in the world without any connection to gold anymore. Thus, from that moment on, the exchange rate was no longer determined by default, but was determined dynamically following a very simple system, namely the law of supply and demand (supply and demand) called the floating exchange rate system. as a new phase in the history of forex trading.
In this phase, currency exchange transactions are carried out by banks, while the government and companies must contact the banks as mediators in the currency exchange process. By telephone contact, the bank records the unit value of the currency price to be used as a reference for buying or selling transactions. Thus, since then a financial market system has been created in an over-the-counter network .
THE ERA OF ONLINE FOREX TRADING
In the era of the 80’s to 90’s. The global economy is growing and ushering in the history of forex trading in the modern era with the emergence of online forex trading that can be done by anyone without exception. In this era of online forex trading, forex traders have emerged who are no longer limited to government institutions, central banks, large companies or individuals who have large capital. Everyone without being limited by the amount of capital can also be involved in forex trading activities, even if it is only with a capital of $1. Along with the development of internet technology, forex brokers began to compete to create a forex trading service system with all bonuses and service facilities that make it easier for anyone who wants to get involved in the world of forex trading.
In 2013 the historical development of online forex trading has dragged many forex traders from various circles. Until, in that year, the value of trading volume in the forex market was recorded very quickly with daily liquidity reaching 5.3 trillion USD per day.
However, the development of the online forex trading business has also triggered the emergence of many forex brokers. Therefore, be careful in choosing a forex broker when you decide to be serious in undergoing an online forex trading business, so that you do not get caught up in fraud and fraud by rogue brokers. The following are recommendations for the best and most trusted forex brokers that have proven credibility, which can be used as a reference for you.