How a Decade of Change Is Reshaping the Industry
A decade ago, the brokerage market looked fundamentally different. The flagship product was leveraged contracts for difference (CFDs), marketing budgets targeted short-term speculators, and the typical new client opened an account to trade forex with triple-digit leverage. Today, the situation has changed in ways few anticipated. Regulatory changes, a generational shift toward passive investing, and rapid technological development have forced brokers to adapt or become obsolete.
Our discussion covered the forces driving change, modern investors' expectations of their platforms, and why brokers who don't evolve risk losing relevance in a market that had approximately 6 million active CFD traders worldwide by 2025 - even as the very definition of the retail client is being rewritten.
If we go back to 2015, what did a typical retail brokerage operation look like, and what has changed most since then?
The industry was almost entirely built on leveraged CFD trading. Forex was king. Brokers competed on spreads, leverage ratios, and sign-up bonuses. The business model was largely, frankly, based on client churn - attracting new traders, earning on the spread and the fact that most retail positions went against the client, then replacing those who left.
Customer lifetime value was short, marketing costs were high, and the regulatory environment was still relatively liberal. You could offer 200:1 leverage, sometimes 500:1 in certain jurisdictions.
Fast forward to today, and the picture is unrecognizable. ESMA's 2018 product intervention measures were like an earthquake. The elimination of so-called welcome bonuses, restriction of leverage to 30:1 for major currency pairs, banning binary options, introduction of mandatory negative balance protection, and standardized risk warnings - all of this fundamentally changed the economics.
Brokers who built their offering on excessive leverage had to rethink everything. Then regulators in Australia and the UK followed suit, implementing similar restrictions. The global trend was clear: the days of extremely high-leverage products being marketed as a path to easy, quick money were over.
There's a lot of talk about a structural shift toward passive and long-term investing among retail clients. Is this real, and what's driving it?
It's very real, and the numbers speak for themselves. For a trader from Poland like myself, the best example is XTB, which operates right in my own backyard. In 2019, approximately 80% of XTB's new clients chose a CFD as their first trade. By 2025, that percentage had dropped to just 7%. Over 90% of first trades by new EU clients at XTB last year involved stocks, ETFs, or long-term investment plans. This isn't a marginal change - it's a complete inversion of the client profile.
But why traders want to use these instruments? First, there's a generational effect. Younger investors who grew up in the era of Robinhood, fintech apps, and democratization of stock market access aren't particularly interested in speculating on forex with leverage. They want to buy fractional shares of companies they know, build diversified portfolios through ETFs, and invest for retirement.
It's also significant that interest rates rose sharply from 2022, making savings and investment products more attractive compared to short-term trading. Third, governments across Europe have begun promoting long-term wealth building through tax-advantaged accounts, which brings us to the retirement investment accounts phenomenon in Poland.
Those who still crave quick profits have moved to the cryptocurrency market. It's characterized by decidedly higher volatility than forex and is much less regulated, allowing traders to use significantly higher leverage there.
Could you explain what happened in Poland regarding retirement accounts and why it matters for the broader industry?
Poland has become one of the most compelling examples of how a regulatory framework combined with smart product strategy can transform an entire market.
IKE (Individual Retirement Accounts) and IKZE (Individual Security Accounts) are tax-advantaged forms of saving and investing for future retirement. IKEs offer complete capital gains tax exemption under certain conditions. IKZE allows investors to deduct contributions from taxable income, and post-retirement withdrawals are subject to a favorable flat tax of just 10%. They've existed for years, but the brokerage industry only recently began offering them through modern digital platforms.
XTB launched IKE accounts in late 2024 and IKZE in mid-2025, and the impact was enormous. By combining tax-advantaged brokerage accounts with a promotion enabling commission-free trading and interest on idle cash, XTB opened approximately 442,000 brokerage accounts in Poland alone in 2025, primarily driven by demand for these retirement products.
The December rush, when investors hustled to make year-end contributions for tax reasons, brought the highest monthly total of brokerage account openings in Poland since 2010. Across the entire Polish market, brokerage houses opened an estimated 168,000 new IKE accounts and 94,000 new IKZE accounts in 2025, representing growth of over 130% year-over-year.
I know it's a big leap from CFDs to local retirement products, and not every broker will be able to make that move due to regulatory constraints. But examples from the largest players, like eToro offering cash ISAs in the UK or French retirement products, show where client opportunities can be found today
How important is technology in this new landscape? Is platform quality really a differentiating factor?
It's the differentiating factor. The era when MetaTrader 4 or 5 was the default system and every broker offered virtually the same interface is fading into memory. We saw this clearly after Apple removed MetaTrader from its App Store in 2022. Although it was ultimately restored, the incident was a warning signal. Brokers realized they couldn't afford to build an entire business on an external platform over which they had no control.
Leading firms are now investing significant resources in proprietary platforms designed for a much broader range of applications than just leveraged trading. We're talking about integrated ecosystems - a single app where a client can trade CFDs, buy stocks, manage an ETF investment plan, contribute to a retirement account, hold a multi-currency portfolio, and pay for groceries with a linked debit card. Plus500, Revolut, and Trade Republic are all heading in the direction of the all-in-one “super financial app.”
Clients opening accounts today expect a mobile experience that matches their banking app. They expect real-time portfolio analysis, instant deposits and withdrawals via local payment methods, and a seamless onboarding process.
In an industry where 65% of new CFD accounts worldwide in 2025 were opened via smartphones, a clunky desktop-era platform is a competitive death sentence.
What about artificial intelligence and algorithmic trading? Is that changing retail behavior?
Algorithmic trading was once the exclusive domain of institutional desks. That's no longer the case. The emergence of AI tools, including large language models, has enabled retail investors to generate strategy logic using natural language, without needing to write code.
For brokers, this creates both an opportunity and a challenge. The opportunity lies in offering infrastructure that supports automated strategies - fast order execution, API access, social trading features, or copy trading. The challenge is that algorithmic traders are demanding clients.
They require low-latency order execution, high liquidity, and reliable uptime. They'll leave if the infrastructure can't keep up. Brokers who invest in this will build a very stable client base. Those who don't will lose the most sophisticated segment of the market.
If you were advising the board of a retail CFD broker on priorities for retention and acquisition, what would top the list?
First, expand the product offering beyond CFDs. The numbers clearly show this - the marginal new client in most European markets isn't opening an account to trade FX with leverage. They're opening an account to buy a fractional share of Nvidia, set up a monthly ETF savings plan, or take advantage of a tax-protected retirement account.
If a broker's platform only offers CFDs, they're fishing in an increasingly smaller pond.
Second, localize. Third, invest in education and community. The new generation of investors wants to learn. They expect webinars, market analysis, educational content, and interactive tools. In 2024, over 70% of major brokers added new educational features. This isn't just a marketing ploy - educated clients are more engaged, trade more frequently, and stay longer.
Fourth, take the super-app model seriously. The competition is no longer limited to other brokers. It's neobanks like Revolut, fintech companies like Trade Republic, and even traditional banks launching their own investment platforms.
The 2026 client doesn't want five separate apps for banking, investing, retirement savings, and payments. The broker who integrates all these elements into one cohesive experience will win the race for the primary financial relationship.
Fifth, trading costs matter. People can do the math and know that the exact same product is offered by different providers with different costs. The more attractive the cost offering, the lower the customer acquisition cost.
The shift toward passive investing and lower-margin products seems to create a profitability problem. How should brokers think about this?
That's currently the central tension in the industry. XTB's results – again - illustrate this perfectly. The company acquired a record number of clients in 2025, but revenue per active client fell from 2,700 zlotys to approximately 1,800 zlotys. Net profit dropped from 857 million zlotys to 644 million zlotys, despite CFD trading volume increasing by 41%. New clients are simply less profitable per capita than the existing CFD-focused base.
However, I think that's the wrong framing of the problem. The question isn't whether revenue per client will fall in the short term - it will. The question is whether the total addressable market expands, whether client retention improves, and whether new monetization opportunities emerge that didn't exist before.
A client who starts with a retirement account may eventually try CFD trading. A client with a multi-currency portfolio can generate revenues from currency exchange. Customer lifetime value (LTV) calculations change completely when we move from a churn-based model to a long-term relationship model.
The industry has gone through this type of transformation before. When ESMA restrictions first appeared in 2018, many analysts predicted they would ruin brokers. Some smaller, less flexible firms indeed struggled.
But the industry overall expanded significantly - global monthly retail forex and CFD trading volumes tripled from below $10 trillion in 2015 to over $40 trillion in 2025. Firms that adapted didn't just survive - they became much larger and more diversified.
What will the retail brokerage market look like in three to five years?
I think the boundaries between brokers, banks, and fintech platforms will continue to blur. The most successful retail brokers of 2030 will more closely resemble financial super-apps than traditional trading platforms. They'll offer investing, saving, payments, lending, and insurance through a single interface. Some started as CFD brokers. Others as neobanks or payment companies. They'll converge on the same model.
From a geographic standpoint, Asia, the Middle East, and Latin America will be growth drivers. European and UK markets are maturing, and competition will become increasingly fierce. Brokers currently expanding into Indonesia, Brazil, Chile, and the Gulf states are preparing for the next wave of retail investor adoption.
Regulations will continue to tighten, which is generally beneficial for legitimate players. Stricter regulations raise the cost of doing business, pushing undercapitalized or dishonest operators out of the market. Brokers who embrace regulation and build client trust will be rewarded with scale.
Technology will remain a primary differentiator. Firms that effectively implement AI, offer 24-hour trading, responsibly integrate cryptocurrencies, and ensure seamless mobile operation will capture the lion's share of the next generation of investors. Firms that stick to the old model - high leverage, high client churn, and universal MetaTrader platform - will gradually lose relevance.