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ECN FOREX BROKER

ECN, which stands for Electronic Communication Network, really is the way of the future for the Foreign Exchange Markets. ECN can best be described as a bridge linking smaller market participants with tier-1 liquidity providers through a FOREX ECN Broker. This linkage is done using sophisticated technology setup named FIX Protocol (Financial Information Exchange Protocol).

  • Editorial Team
  • May 12, 2021
  • 1 minute

ECN, which stands for Electronic Communication Network, really is the way of the future for the Foreign Exchange Markets. ECN can best be described as a bridge linking smaller market participants with tier-1 liquidity providers through a FOREX ECN Broker.

This linkage is done using sophisticated technology setup named FIX Protocol (Financial Information Exchange Protocol). At one end, the broker obtains liquidity from tier-1 liquidity providers (Major Banks) and makes it available for trading to its clients. On the other side, the broker delivers clients’ orders to Liquidity Providers for execution.

An ECN broker benefits from commission fees per transaction. The higher trading volume the broker’s clients generate, the higher the broker’s profitability.