Dramatic Changes in Binary Options

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It was a major announcement for the binary options industry, especially coming from the most popular regulator in the world. Over the past year, CySEC along with other financial regulators have toughened laws governing the Forex and binary options industries.

This was a response to isa we probably wont allow binary options numerous claims of frauds in the industries by aggrieved clients, especially in the binary options industry. We have already seen changes in the Forex industry that have limited the amount of leverage offered to clients and the eradication of trading bonuses.

MiFID II also proposes a lot more changes, all of which aim to make these over-the-counter industries a bit more centralized. If the Cyprus regulator were to impose a total ban on binary options, it certainly would affect the industry. It also would not be the first regulator to isa we probably wont allow binary options a ban on binary options. Belgium and France have already banned all over-the-counter markets including the Forex market.

Netherlands have banned all forms of advertisement on binary options and Forex. These are all part of a global war on binary options that CySEC has suggested it may join. Being the most popular regulator of binary options, a ban on the financial instrument can cripple the entire industry.

However, it will certainly not kill the industry. When Netherlands banned the advertisement of binary options and Forex, the action only drove the brokers underground. Despite the ban, brokers can still sign up clients based in Netherlands. Since the industry is decentralized, it is virtually impossible to completely shut it down.

Moreover, a ban could have a negative effect in that unregulated brokers take the opportunity to fill the gap left by the regulated brokers. Therefore, a ban on binary options by CySEC may leave the traders open to solicitation by unscrupulous, unregulated brokers. A better approach would be through stricter regulation, as the CFTC did. Following an overhaul on laws governing over-the-counter financial instruments through Dodd-Frank, the CFTC and SEC imposed tougher laws on the industries that scared most brokers away.

Through keen supervision and tough penalties, cases of fraud were reduced, leaving only the most trustworthy brokers in operation. Right now, there are only 2 regulated binary options brokers licensed in the US, and there are few cases of fraud. The good news is that they have not determined to ban the industry, yet. As the chairperson of CySEC isa we probably wont allow binary options, they are still in consultation, probably even with some of the largest binary options brokers.

If these brokers and the regulator can agree on more favorable terms, the industry isa we probably wont allow binary options remain active, possibly even thrive, while still protecting the traders. Stay up to date with the financial markets everywhere you go. CySEC cracking down on the industry Over the past year, CySEC along with other financial regulators have toughened laws governing the Forex and binary options industries.

How could a complete ban on binary options affect the industry? Cyprus has become It also would not be the first regulator to put a ban on binary options. Comments 1 comment s Click here to cancel reply. Leave a comment jesusrcc. Banning binary options instead of looking for ways to force brokers to comply with regulations and to spread information about unregulated brokers to future traders, looks to me the way to avoid the consequences of their own incompetence.

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The lawmakers in Israel will on January 2, meet to discuss the hot subject of binary options. Will the parliament relax regulations of binary options industry or tighten them? While the problem of capital outflow from emerging economies to the U. While the parliament will be debating the state of binary options industry in Israel, the lawmakers are expected demand more action from the ISA to stop binary options firms based in the country from selling their products to overseas investors.

The ISA chief, Shmuel Hauser, earlier asked the Attorney General, Avichai Mendelblit, to consider amending the securities to laws to empower the agency to bar Israel-based binary options firms from marketing their products abroad.

According to Hauser, binary options trade is an illegal gamble disguised as investment. The ISA is also worried that the involvement of Israel firms in binary options trades is giving the country a bad reputation.

The Euro has weakened against the dollar as recent interest rate hike has made U. But the industry has recently been marred with claims of scam, sparking a wave of complaints and inviting regulatory wrath. While there are regulated binary options firms operating within the law and ethics, the rise of unregulated binary options brokers has tainted the industry and heralded an era of tough regulations for everyone.

As the ISA waits for the review of the securities law to allow it ban Israel-based binary options firms from recruiting offshore customers, the agency has been collaborating with international peers like the SEC in the U.

Several European Union member countries have already banned marketing of binary options products in their jurisdictions or are working on legislations to ban such activities.

And Belgium has taken the radical measure to issue a blanket ban on all retail binary options trading in the country. Other than regulators, payments processors such as Visa and MasterCard have also joined the war against binary options firms.

The payments card companies are declining to process deposits to binary options firms operating in jurisdiction where the activity is outlawed. As for the case of Israel, handing the ISA more powers could effectively kill binary options industry in the country. Stay up to date with the financial markets everywhere you go. Taking the war offshore The ISA chief, Shmuel Hauser, earlier asked the Attorney General, Avichai Mendelblit, to consider amending the securities to laws to empower the agency to bar Israel-based binary options firms from marketing their products abroad.

Belgium in blanket ban Several European Union member countries have already banned marketing of binary options products in their jurisdictions or are working on legislations to ban such activities.

Comments 0 comment s Click here to cancel reply. Get the most recent news at your inbox Stay up to date with the financial markets everywhere you go. Sign up for updates. View ICO See whitepaper. Is it possible that Bitcoin BTC is still substantially overvalued? Ethereum Analysis - USD defended but Is Groestlcoin GRS really the 'all-in-one' cryptocurrency? Get the most recent news at your inbox.