Not so long ago, we witnessed a scandal in the binary options industry. The thing is, the CSA, Canada’s financial regulator, blacklisted 37 binary options brokers. The regulator backed its decision by the fact that multiple violations were found as the result of a complex audit. The list of violations includes cases of non-payments, account blocking etc.
Market Leader have already highlighted the incident here:
https://www.profi-forex.us/news/entry4000007612.html
We also feel like mentioning that the incident triggered a wave of ambiguous emotions in the international trading community.
How did the scandal affect the reputation of binary options?
The public opinion regarding binary options as a financial asset split into 2 confronting parties. While the adversaries support the regulator’s decision to put an end to this mayhem since binary options are another casino, the advocates respond that with reliable and regulated brokers, binary options are the basically same financial assets as FX, stocks, metals, indexes and commodities, even though binary options are derivatives and any of the mentioned markets can be underlying assets for binary options.
Simply put, the advocates say that binary options trading can be profitable provided that you know what you are doing and have enough skills and expertise.
In order to clarify the situation, Market leader addressed a manger of PrimeTime Finance, a respected and regulated binary broker operating under a CySEC license (subject to MiFiD and Investor Compensation Fund).
PrimeTime Finance does really stand out from the crowd when it comes to security issues, including and safety of client funds. On top of that, the company comes up with various innovative solutions for more efficient trading. PrimeTime Finance claims that you can withdraw your funds anytime and with no limitations whatsoever.
Binary Options Are as Risky as Driving an Auto
When asked about the incident and the gambling nature of binary options, the PrimeTime Finance expert responded the following:
Unfortunately, the incident shows that many representatives of the international trading community are subject to emotions and therefore they have reacted the news this way. Emotions are the biggest source of troubles when it comes to trading any financial markets. On top of that, it wasn’t about binary options themselves. It was about some binary brokers that failed to comply with some CSA requirements and that’s it.
As for the gambling nature of binary options, this is not the case at all. These are derivatives, financial assets. Decent binary brokers are regulated by financial regulators in Europe, including the FCA (UK) and the CySEC (Cyprus ). On top of that, for those of you who don't know, binary options are legal in the USA as well despite various rumors that they are not. For example, there is a whole binary options exchange created in the USA. It is called NADEX. It is supervised by the CFTC. That said, those who say that binary options are illegal and are not financial assets are definitely mistaken.
This leads us to believe that it is not about the nature of binary options. It is all about how the trader approaches the assets. You can gamble anywhere, whether it is casinos, poker, Forex, stocks, commodities, futures, or binary options. You can even apply this thing to virtually any human activity.
Let's consider driving a car as an example. Everyday we are participating in the traffic as drivers, passengers or pedestrians. All of us are perfectly aware of the fact that a vehicle is not a thing to have fun with. It may present serious danger if not handled the way it should. We also know that the more we stick to traffic regulations, the safer it is for us and those who surround us. There is always a chance to get into a car accident but the more skilled driver you are and the safer you drive (especially if you don’t drink and drive), them more chances you have to avoid those incidents and to stay safe and sound. That’s the way it is! And the same holds true for trading financial markets.
If we want to succeed in trading we start learning how to become an advanced trader (the way people learn to get a driving license), then we need a decent broker the same as a driver needs a decent car. We also need to build up expertise in trading to feel more comfortable and confident the way drivers build their driving expertise gradually, step by step. Nobody can become an expert in an instance. It requires time, effort and money.
The problem is that some people want all of it and what it now. They are not ready to spend long hours every day to practice and learn lessons from their mistakes. All they want is instant success. That’s why they gamble binary options hoping to get lucky. By that’s not who it works.
When asked about catchy ads across the web, this is what the expert responded:
Unfortunately, you can find tons of those ads on the internet these days. More often then not, those are just empty promises as unsuspecting rookies fall prey to some tricks played on them by some binary brokers. Probably, that’s the way those 37 blacklisted brokers have been conducting their businesses. Most of the time, those big promises are designed to make people waste their money by gambling binary options. However, binary options can be traded professionally and profitably.
When choosing a binary broker, it is always a good idea to be guided by objective information rather than someone’s promises. The first thing you should check is licenses. No license, no trust. On the other hand, if you are trading with a regulated broker, you can be sure that you are not going to be scammed. With a licensed broker, you have all chances to succeed.
