The major Cayman Islands financial services regulator is the Cayman Islands Monetary Authority (CIMA). CIMA is in charge of maintaining the Cayman Islands currency, regulating and overseeing financial services, assisting foreign regulatory bodies, and advising the Cayman Islands government on regulatory issues pertaining to financial services.
The Cayman Islands are renowned for having investor-friendly rules and permissive laws, which have helped to make them one of the most well-known tax havens in the world. It offers considerable financial advantages, strict privacy protections, and light regulatory requirements. Thus, it is not surprising that the bulk of forex brokers operating in the Cayman Islands benefit from a tax-free environment and loose regulatory standards. The advantage is that, in comparison to other brokers licenced in more restrictive jurisdictions, they can provide significantly more flexible trading conditions.
Because so many brokerages use its regulatory services, CIMA is not viewed by the online FX/CFD market as a regulatory body in the same “weight class” as the FCA or Australia’s ASIC.