Where does Forex Market Come from?

With the development of the forex trading market, tremendous people begin to learn and rush into the Forex trading. As the trading volume explodes, investors have invented numerous and famous trading principles, such as wave principle, Candlestick cross star, and other trading techniques, which are wildly applied in different markets. But do you ever wonder where is the origin of forex？

The earliest forex transactions appeared in ancient times. In the period of the Talmud, “changers” who mainly helped others to exchange currency and collected commissions in every exchange appeared. These people gathered in a small corner of the city or stood outside the temples where Gentiles often visited. Around the 4th century AD, the Byzantine government controlled a company that monopolized Forex transactions. In 1472, Italy established a pawnshop, and the world's first “bank” in real form appeared. Monte dei Paschi di Siena (BMPS), the oldest bank in the world, is still in operation today.

In the 15th century, to meet the currency exchange needs of textile merchants, the Medici family (Medici) opened a bank abroad and began to use “current account books” to process transactions. This type of ledger could display forex accounts and domestic currency accounts with foreign banks. In the 17th and 18th centuries, the forex market in Amsterdam remained active. Agents and merchants in the UK and the Netherlands dominated the Forex market.

In the 1850s, a company named Alexander Brown & Sons began trading forex, and it was regarded as a leading market participant. Pioneers of forex transactions in the history of the United States also include J.M. Do Espirito Santo de Silva, who was allowed to conduct forex transactions in the 1880s. In 1880, a global monetary system was formed based on the gold reservation. Therefore, this year was the beginning of the modern forex. From 1899 to 1913, Forex reserves increased by 10.8%, while gold reserves only increased by 6.3%, which indicated that emerging forex markets have gradually received attention.

In 1902, two forex brokers appeared in London. In 1913, almost half of global Forex transactions were conducted in British pounds. This is of great significance to the formation of the British capital market. The number of forex banks in the UK rose from 3 in 1860 to 71 in 1913. Although the British pound almost dominated Forex trading at the time, Britain itself was absent in the early years of the 20th century. The most active centers for forex transactions were indeed Paris, New York, and Berlin. London and the entire British Empire were relatively silent before 1914.

WikiFX is a global Forex inquiry platform that provides updated rankings of Forex brokers. So if you are seeking a broker to start your Forex trading journey, please search the detailed information about the broker on the WikiFX.