There can be real chaos if Forex brokers and other Forex market participants are not regulated: no one can stop the growth of quotes, maintain liquidity, monitor volatility, establish laws and trading rules, or combat fraudulent activity.
Getting into an online platform without all of these third-party proxies is a nightmare: arbitrariness, backroom one-day deals, unsupported exchange rates, and massive, unpredictability. Of course, even now, it is difficult to argue that private traders' interests are so well protected that they cover all aspects of market movement. Outside of trading, however, capital is well-protected against non-market risk and broker dishonesty.

Forex regulators play a crucial role in maintaining the integrity and stability of the foreign exchange market. They establish rules and guidelines to protect traders and ensure fair practices. Key functions include:

1. Licensing and Supervision: Regulators issue licenses to forex brokers, ensuring they meet specific standards for operation.

2. Compliance Monitoring: They monitor brokers' activities to ensure compliance with laws and regulations, reducing the risk of fraud and malpractice.

3. Consumer Protection: Regulators enforce measures to protect traders, such as requiring brokers to segregate client funds from operational funds.

4. Dispute Resolution: They provide mechanisms for resolving disputes between traders and brokers.

5. Transparency and Reporting: Regulators require brokers to maintain transparent operations and regular reporting, promoting accountability and market stability.