Market makers are forex brokers that provide liquidity to the market, always taking positions opposing those of their clients. The fact that they are counter party to a retail forex trader's trades in and of itself is not a bad thing, because occasionally they offset the difference between their net short and net long positions in the interbank forex market. In other words, these market makers hedge their net exposure in order to protect themselves from risk.

Although many of them call themselves forex brokers that are not actually brokers. A forex broker is an intermediary. Dealers are not intermediaries; they are traders. You could say: "Traders? Like me? I am a trader." Well, not exactly like you. They are not like you because they operate from a far more advantageous position than you do. You signed their contract, you abide by their rules and you voluntarily gave your money to them, not vice versa. Since dealers do not not hedge their net exposure, if you are a successful trader (i.e.

ECN stands for electronic communication network. ECN Forex brokers provide you withdirect access to other participants in the forex market - both retail and institutional traders. This leads to some advantages, e.g. ECN brokers allow scalping and offer very low spreads, but there are also disadvantages - these brokers charge commissions for forex trading. Generally speaking, trading through ECN forex brokers is more transparent, as you see real exchange rates and know how much your broker makes(a commission of, say, $3 per standard lot).