In certain areas, many traders use VPN to access blocked websites of forex brokers. Is it safe? What are the risks of forex trading with VPN?
In some countries, traders might experience difficulties accessing a number of websites, including those of global forex brokers'. One way to solve this is to access those websites by using a VPN (Virtual Private Network) or proxy. VPN offers a private network that can access almost any website even if it's restricted by certain countries' authorities. Other than that, some traders also like to use VPN because of privacy matters. The need of keeping private information secured now has extended to many people, including forex traders.
Just like any other website, forex brokers also gather, store, and might use your information. While it can be harmless, there's always a possibility that your data can be abused for unknown purposes. A VPN can prevent this by making you stay anonymous so you can browse the websites undetected.
It's helpful to think of a VPN like a bodyguard for your personal data information. When you go somewhere through a tangled network of public Wi-Fi, your VPN will shield you from password thieves and keep you safe from risky places. So to put it simply, using VPN is quite an easy way to get around geo-restrictions and regulations, as well as preventing hacks and leaks of your personal information.
See Also: 5 True Stories of Forex Broker Scams
However, all of those protections must come with a price. In general, using a VPN can be problematic, especially if you're using the free ones. As a forex trader, there are some extra cautions of using VPN because it is often said that many brokers don't allow forex trading with VPNs or proxies. Some would even cancel the trader's profits if caught using a VPN.
So, is forex trading with VPN still worth to try? And what are the problems that might occur?
The Risks of Using Free VPNs
With the growing numbers of VPN providers in recent years, it's getting trickier to pick one. The market continuously expands even further as people work from home due to the coronavirus pandemic. Many VPNs are now offered as a free package but promise similar benefits as the paid versions. Considering the various advantages that sound attractive for many internet users, the first question that you should ask yourself is: what's in it for them?
John Mason of thebestVPN.com reveals some possible risks of using a free VPN, as explained below:
- Free VPNs aren't that safe because the service itself is free of charge. The providers are not transparent about how they make money. If you think about it, maintaining the hardware and expertise for an extensive network and users must produce an expensive bill for the company. Keep in mind that the company also has its business to manage, so it only makes sense if they charge you for such an expensive service, right?
- Often, if the company does not offer you any products, you are most likely the product. The choice is either you pay with your money or with your data. In free VPN services, it is possible that the providers would sell your data to partner companies or to third parties who are willing to pay for it. So, although free VPNs would promise you anonymous and safe browsing, more than 70% of these providers ironically contain third-party trackers.
- Several free VPNs have been caught doing foul practices in the form of advertisements, traffic diversion to their affiliates, and so on. Research on these harmful acts has also been carried out by CSIRO, an Australian scientific research institute.
The next thing that you should be aware of is that your device might catch malware. Based on the study of CSIRO, around 38% of free Android VPNs contain malware that could harm your devices. This is quite alarming because users might not be able to detect the malware straight away, so using a free VPN is considered risky. Not only that, free VPN services are often full of ads ranging from small pop-ups to more annoying ones that block the whole screen for about 5-30 seconds.
Things to Consider before Using a VPN
Regardless of the risks, some traders still use VPN service because they are pressured to do so. Some important matters should be taken into account by forex traders. First, you need to reconsider your broker choice.
There are tons of excellent forex brokers with a wide range of competitive offers. If you can find a legitimate broker which site is not blocked in your country, then you don't have to use a VPN at all! But if your broker of choice is blocked and you must use VPN to access it, then you should apply the principle of caution when choosing which VPN you choose.
Try to pay attention to the following things:
- Consider using a freemium-based VPN service provider. The term "freemium" means that some of their services are free, but some are paid. This way, we know that they're getting incomes from the premium users and provide access for free users. This way, you can reduce the possibility of selling data to third parties. The chance of finding this kind of provider might be small, but if you come across one, their free service is quite enough if you only need it to access your broker's sites occasionally. But if you need a VPN regularly, then it's a good idea to subscribe to the premium feature.
In addition, please note that using a freemium or premium VPN service still does not fully guarantee that the company will not collect your data and sell it to other parties. Some people underestimate this risk, so they keep using the same VPN service for months, even years. However, if you consider keeping your data private is important and don't want to lose it to other parties without your consent, then consider accessing the blocked forex broker sites by using non-VPN alternative options, such as changing browsers or ISPs.
Do All Forex Brokers Allow the Use of VPN?
To answer the question, some brokers essentially allow the use of a VPN, but some are not. Strictly speaking, some brokers stated that if certain countries block access to their websites, traders can register an account and withdraw their funds by using a VPN or proxy.
See Also: Recognizing Forex Broker Scams
One of them added that if the initial registration used a VPN, then the broker will ask for confirmation to clarify the IP. This step is crucial so that the personal data entered by the clients is correct and valid.
In some other cases, a broker would choose to do their best to follow up the domain transfer first for every time they are blocked so that clients can access the site normally. While the process is ongoing, clients are allowed to access the site via VPN or proxy.
On the other hand, there are also some brokers who don't allow their clients to use VPN for forex trading. Instead, they offer an alternative website with a different URL or domain so traders can still access it without using any VPN.
No matter what, if you come across a broker that does not allow VPN and the official site is blocked in your country, you shouldn't worry much because you can still access the trading platform app without a VPN. Even in the worst-case scenario where the trading platform servers are also blocked, a reliable broker will surely provide the best solution as soon as possible.
The Bottom Line
From this article, we can conclude that while it offers protection and other advantages, using VPN also imposes some risks for traders, including the leak of personal data, malware, and annoying pop-up ads. If the broker's site is not blocked in your country, then it might be safer not to use a VPN, especially the free ones. But if the site is blocked, consider using a freemium or premium VPN to avoid the risk of a data leak
Moreover, it is possible that the site is blocked and the broker's also not allowing you to use a VPN. If this is the case, you can try to look for another broker or contact their customer support to ask for help and alternative suggestions.