Foreign exchange history is a long one.
There are evidence of the forex trading from the times of Babylonians. There is historical evidence that suggest that these ancient people had some kind of currency exchange and trading system. Of course earlier they would trade and bet various goods. A bit later in the timeline people started betting silver and gold – that was when the metal age came around.
Everything changed for the people when coins were first introduced. When the people in power realized what power one small piece of gold held over the regular folk trading gold became a restricted business. And of course, as valuable as money were before the gold era, that value was diminished with the gold appearance in the markets.
The next pivotal moment for the modern forex trading came in 1971. Back then the golden standard was removed by Richard Nixon which resulted in the free-floating currency system. Rates were allowed to fluctuate by 2 percent as currencies were no longer regulated by the gold prices. These changes allowed more people into trading and foreign currency operations which made trading that more interesting and accessible.
In the three years following Nixon changes, the volume of trading increased by three times. That led to two-tier currency trading market to appear although this type of forex was killed off in 1974.
After many more changes and shakes forex market was finally presented in the current form to the traders of the world. The changes allowed the market to be more stable and understandable for various traders from different circles and social levels.
After many more changes and shakes forex market was finally presented in the current form to the traders of the world. The changes allowed the market to be more stable and understandable for various traders from different circles and social levels.
Right now forex market has grown to enormous size. Daily monetary turnover in forex adds up to about $5 trillion per day. Can you imagine? About one fourth of that is due to American segment of the market. We bet that ancient Babylonians didn’t even think that their invention will take on this size when they first started trading in the primitive exchange system.
And we haven’t seen the last of the growth. It is predicted that by the end of 2020 Forex turnover will add up to $10 trillion. Not bad, huh?
