Interactive Brokers

History

In 1977, Thomas Peterffy left his job designing commodity trading software for Mocatta Metals, and bought a seat on the American Stock Exchange (AMEX) as an individual market maker. The following year, he formed his first company, named T.P. & Co., to expand trading activities to several members under badge number 549. At the time, trading used an open outcry system. Peterffy developed algorithms to determine the best prices for options and used them on the trading floor. The firm became the first to use daily printed fair value pricing sheets. In 1979, the company expanded to employ four traders, three of whom were AMEX members. In 1982, Peterffy renamed T.P. & Co. to Timber Hill Inc.; he named it after a road to a favorite retreat, one of his properties on Hutchin Hill Road in Woodstock, New York.

By 1983, Peterffy was sending orders to the floor from his upstairs office; he devised a system to read the data from a Quotron machine by measuring the electric pulses in the wire and decoding them. The data would then be sent through Peterffy's trading algorithms, and then Peterffy would call down the trades. After pressure to become a true market maker and keep constant bids and offers, Peterffy knew that he would need his employees to monitor market movements closely, and that handheld computers would help. At the time, the AMEX didn't permit computers on the trading floor. As a result, Peterffy had an assistant deliver market information from his office in the World Trade Center. In November 1983, he convinced the exchange to allow computer use on the floor.

In 1983, Peterffy sought to computerize the options market, and he first targeted the Chicago Board Options Exchange (CBOE). At the time, brokers still used fair value pricing sheets, which were by then updated once or twice a day. In 1983, Timber Hill created the first handheld computers used for trading. As Peterffy explained in a 2016 interview, the battery-powered units had touch screens for the user to input a stock price and it would produce the recommended option prices, and it also tracked positions and continually repriced options on stocks. However, he immediately encountered opposition from the heads of the exchange. When he first brought a 12-inch-long (30 cm) by 9-inch-wide (23 cm) device to the exchange floor, a committee in the exchange told him it was too big. When he made the device smaller, the committee stated that no analytic devices were allowed to be used on the exchange floor. Effectively blocked from using the CBOE, he sought to use his devices in other exchanges.

1993 to 2000

Interactive Brokers Inc. was incorporated in 1993 as a U.S. broker-dealer, to provide technology developed by Timber Hill for electronic network and trade execution services to customers.

In 1994, Timber Hill Europe began trading at the European Options Exchange, the OM Exchange and the London International Financial Futures and Options Exchange. Also in 1994, Timber Hill Deutschland became a member of the Belgium Futures and Options Exchange, IB became a member of the New York Stock Exchange, and the Timber Hill Group LLC was formed as a holding company of Timber Hill and IB's operations. Timber Hill UK Ltd was incorporated in November 1994.

In 1995, Timber Hill France S.A. was incorporated and began making markets at the Marché des Options Négociables de Paris (a subsidiary of Euronext Paris) and the Marché à Terme International de France futures exchange. Also in 1995, Timber Hill Hong Kong began market making at the Hong Kong Futures Exchange and IB created its primary trading platform Trader Workstation and executed its first trades for public customers.

In 1996, Timber Hill Securities Hong Kong Limited was incorporated and began trading at the Hong Kong Stock Exchange. In the next year, Timber Hill Australia Pty Limited was incorporated in Australia, and Timber Hill Europe began trading in Norway and became a member of the Austrian Derivatives Exchange. By 1997, Timber Hill had 284 employees. In 1998, Timber Hill Canada Company was formed, and IB began to clear online trades for retail customers connected directly to Globex to trade S&P 500 futures.

In 1999, IB introduced a smart order routing linkage for multiple-listed equity options and began to clear trades for its customer stocks and equity derivatives trades. Also in that year, Goldman Sachs attempted to purchase the company and was rejected.

In 2000, Interactive Brokers (U.K.) Limited was formed and Timber Hill became a primary market maker on the International Securities Exchange (ISE).

2001 to 2019

In 2001, the corporate name of the Timber Hill Group LLC was changed to Interactive Brokers Group LLC, which at the time handled 200,000 trades per day. In 2002, Interactive Brokers, along with the Bourse de Montréal and the Boston Stock Exchange, created the Boston Options Exchange. Also in 2002, the company introduced Mobile Trader and an application programming interface for customers and developers to integrate their mobile phone systems with the IB trading system. Also in 2002, Timber Hill became the major market maker for the newly introduced U.S. single-stock futures.

In 2003, the company expanded its trade execution and clearing services to include Belgian index options and futures, Canadian stocks, equity/index options and futures, Dutch index options and futures, German equity options, Italian index options and futures, Japanese index options and futures, and U.K. equity options. In 2004, the company introduced direct market access to its customers on the Frankfurt Stock Exchange and the Börse Stuttgart. In the same year, IB upgraded its account management system and Trader Workstation, adding real-time data including charts, scanners, fundamental analytics, and tools to the platform.

In 2005, the company launched its forex trading platform IdealPro (now Ideal FX). At that point, Interactive Brokers was one of the largest private securities firms in the United States with $2 billion in capital. It handled 20% of total options volume in the US and 16% worldwide.

In 2006, the IB Options Intelligence Report was launched to report on unusual concentrations of trading interests and changing levels of uncertainty in the option markets. Also that year, IBG took stakes in OneChicago, the ISE Stock Exchange, and the CBOE Stock Exchange. Later in 2006, Interactive Brokers began offering penny-priced options.

On May 3, 2007, the company went public via an initial public offering (IPO) on the Nasdaq, selling 40 million shares, or 10% of the company, at $30.01 per share via a Dutch auction in the largest brokerage IPO since 2005.

In December 2007, the company acquired FutureTrade Technologies, an integrated electronic equity and option trading service provider. In the following year, Interactive Brokers launched Risk Navigator, a real-time market risk management platform. Also in 2008, several trading algorithms were introduced to the Trader Workstation. Among these is the Accumulate-Distribute Algo, which allows traders to divide large orders into small non-uniform increments and release them at random intervals over time to achieve better prices for large volume orders.

2020 to present

In 2020, the company reported reaching a customer base of one million users. In December 2020, IB acquired the retail operations of Folio Investments, including 70,000 accounts, from Goldman Sachs. In January 2021, Interactive Brokers was among brokerages that restricted trading in certain highly volatile stocks, including GameStop and BlackBerry, during a social media-driven trading frenzy.

In May 2021, IB launched trading in spot gold for U.S. clients. In September 2021, the company introduced trading in cryptocurrencies, including Bitcoin and Ethereum. In May 2024, the platform was expanded to clients in the United Kingdom.

In July 2023, the company launched trading on the Taiwan Stock Exchange. A month later, IB launched fractional share trading in Canadian securities.

In August 2024, the company added access to Bursa Malaysia. That month, its subsidiary ForecastEx began operating a regulated market for event contracts. In October, Interactive Brokers began offering forecast contracts on political outcomes, including the 2024 United States presidential election. In 2025, IB launched forecast contracts in Canada.

In July 2025, Interactive Brokers founder Thomas Peterffy said the company was considering a stablecoin and working on 24/7 stablecoin funding for brokerage accounts and transfers of commonly traded cryptocurrencies. In December 2025, the company connected its platform to the Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM), expanding access to UAE equities. Later that month, it began allowing some eligible U.S. retail customers to fund brokerage accounts with stablecoins.

In January 2026, Interactive Brokers expanded 24/7 account funding using USDC, with deposits converted into U.S. dollars through Zerohash. In May 2026, it added access to equities listed on the Korea Exchange and launched a platform for prediction-market contracts listed on Kalshi, CME Group and ForecastEx.

In June 2026, the company connected brokerage accounts to Anthropic's Claude, allowing clients to research securities, analyze portfolios and generate trade instructions for review and approval. Later that month it added connections to ChatGPT and Grok, and in July expanded the service to other tools supporting the Model Context Protocol.

Financials

Interactive Brokers' total net revenues increased from $4.340 billion in 2023 to $5.185 billion in 2024 and $6.205 billion in 2025. Net income available to common stockholders was $600 million in 2023, $755 million in 2024 and $984 million in 2025. Total net interest income rose from $2.794 billion in 2023 to $3.148 billion in 2024 and $3.563 billion in 2025.

Customer accounts grew from 2.562 million at year-end 2023 to 3.337 million at year-end 2024 and 4.399 million at year-end 2025. Customer equity increased from $426.0 billion to $568.2 billion and $779.9 billion over the same period.

For the second quarter of 2026, net revenues were $1.896 billion and net income available to common stockholders was $312 million, compared with $1.480 billion and $224 million in the prior-year quarter.

Interactive Brokers Group, Inc. is a publicly traded company listed on Nasdaq under the ticker symbol IBKR. Despite its public status, the company remains controlled by its founder and chairman, Thomas Peterffy. As of June 30, 2026, the public company held 26.5% of the membership interests in IBG LLC, while IBG Holdings LLC held the remaining 73.5%, which was reported as a noncontrolling interest. IBG Holdings owns all outstanding Class B common stock and is controlled by Peterffy through his ownership of its voting membership interests. As of February 24, 2026, the Class B shares represented approximately 73.7% of the company's voting power.

Lawsuits and fines

Sanctions violations

On 15 July 2025, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) announced a $11,8 million settlement with Interactive Brokers LLC for apparent violations of several sanctions programs. According to the agency, the company provided brokerage and investment services to persons located in Iran, Cuba, Syria and the Crimea region. It also processed transactions involving securities and persons subject to sanctions under the Chinese Military-Industrial Complex, Russia, Global Magnitsky, Venezuela and Syria programs. OFAC attributed the violations to deficiencies in the firm's compliance systems.

Operational and trading failures

In January 2015, following the Swiss National Bank's removal of its minimum exchange rate against the euro, Interactive Brokers said some customers incurred losses in excess of their deposits and that client deficits it might have to cover were about $120 million.

On 20 April 2020, West Texas Intermediate futures for May delivery traded at negative prices. Many Interactive Brokers clients incurred losses exceeding the equity available in their accounts. Following an investigation, in September 2021 the Commodity Futures Trading Commission (CFTC) ordered the company to pay a $1.75 million civil penalty and $82.57 million in customer restitution. The regulator found that Interactive Brokers had received prior warnings about the risk of negative pricing but had not adequately configured its electronic trading and margin systems.

In June 2024, Interactive Brokers disclosed a $48 million loss from a malfunction at the New York Stock Exchange that briefly displayed a 99% fall in the prices of several stocks, including Berkshire Hathaway Class A shares. Customers bought shares after the displayed plunge, and the broker said the NYSE denied its claims for compensation.

Regulatory fines and oversight

In August 2018, Interactive Brokers was fined $5.5 million for violating federal regulations on naked short selling. According to the Financial Industry Regulatory Authority (FINRA), the firm failed to properly supervise such activity between July 2012 and June 2015, despite internally identifying the issue.

In August 2020, Interactive Brokers agreed to pay $38 million in penalties to FINRA, the U.S. Securities and Exchange Commission (SEC) and the CFTC over anti-money-laundering, supervision and recordkeeping failures. FINRA imposed a $15 million fine, while the SEC and CFTC each imposed $11.5 million penalties; the CFTC also ordered $706,214 in disgorgement.

In September 2023, Interactive Brokers agreed to pay $55 million to the SEC and CFTC over recordkeeping and supervision failures related to employees' use of unapproved communication channels, including personal text messages and WhatsApp. The SEC imposed a $35 million penalty and the CFTC imposed a concurrent $20 million penalty.

In April 2024, Nasdaq fined the firm $475,000 for improperly handling five corporate actions between January 2020 and June 2021. The enforcement report cited supervisory and systems failures, including cases in which clients were able to sell shares they did not own.

In October 2024, FINRA fined Interactive Brokers $475,000 for violations of the Customer Protection Rule between June and December 2021. FINRA found more than 800 instances in which the firm miscalculated the number of excess shares of European-listed stocks available for return to customers, and found that an unregistered individual had authority over adjustments to its securities-lending algorithm.

In December 2024, FINRA fined Interactive Brokers $2.25 million for failing to detect more than 4.2 million instances of free riding in customer cash accounts between October 2015 and December 2022.

In April 2025, FINRA fined the firm $400,000 for failures to accurately report required statistical summaries of written customer complaints from January 2020 to June 2022 and to disclose 91 regulatory or civil enforcement actions dating from July 2011 to September 2022. In August 2025, FINRA censured and fined Interactive Brokers $650,000 for failures in its options-account approval process for certain self-directed customers.

Frauds and lawsuits

In 2021, Interactive Brokers was sued by Benjamin Chang, a victim of Haena Park's Ponzi scheme, accusing IB of aiding and abetting Park in her fraud. Through her IB account, Park had lost more than $19 million of investors' money. Beginning in 2012, Park had repeatedly funded the account and then lost on high-risk trades in amounts far in excess of her net worth and the earnings data she provided. IB's compliance department reported her account's activity as suspicious at least 12 times, but IB supervisors allegedly ignored the reports, including reports involving multiple deceptively named accounts. When a compliance analyst reported her account in 2015, IB compliance officers overrode the Customer Account Supervision System to allow Park to continue trading. Park was arrested in June 2016 and sentenced in 2017 to three years in prison. The lawsuit against Interactive Brokers was dismissed by a federal magistrate judge on 25 April 2022 for failure to state a legal claim.

In a lawsuit filed in New York Southern District Court, David A. Castleman, the court-appointed receiver for EminiFX, accused Interactive Brokers of negligence and aiding a breach of fiduciary duty. Castleman alleged that EminiFX founder Eddy Alexandre transferred more than $9 million of investor funds into his personal Interactive Brokers account and lost more than $7 million through high-risk trading. Interactive Brokers denied wrongdoing and said that Alexandre had concealed his fraud. Interactive Brokers removed the action to federal court, but in April 2025 the court ruled that it lacked subject-matter jurisdiction and remanded it to state court. In December 2025, the state court dismissed the complaint with prejudice under the doctrine of in pari delicto. Castleman appealed, and the appeal was calendared for argument before the Appellate Division on 27 May 2026.

The New Jersey Division of Consumer Affairs and the Bureau of Securities determined that Interactive Brokers had allowed Peter Zuck, a three-time convicted financial felon, to open and operate accounts on its platform despite being permanently barred by the National Futures Association (NFA). Zuck was permitted to open at least 16 accounts, including two master accounts in his own name and eleven sub-accounts in the names of other individuals that were linked to the same master account. Zuck lured investors into his Osiris Fund Limited Partnership and used the IB platform to defraud them of more than $7.5 million. The Bureau said that IB failed to conduct an NFA BASIC search during the account-opening process. On February 11 2019, the Bureau announced that IB had agreed to pay a $100,000 civil penalty.