CySec still not planning on regulating binary options

8 Comments

Binary Options regulation is a very hot topic in the binary/forex circles right now. The fact is that while not illegal in Europe it’s frowned upon if excessively marketed. Several binary option brokers are trying to get regulated in Europe however there’s no proper regulatory framework for that and it would take a while for it to appear. CySec being the most popular forex regulator is constantly being asked whether it can or will regulate binary options (especially interested in this are the registration firms looking to help more clients get regulated). CySec already announced on its website a while back that for now it won’t deal with binary options and now it seems under heavy pressure it issued the same announcement in more formal way:

The announcement says that due to the fact that there are a lot of publications in various media channels concerning the regulation of binary options by CySec, CySec wish to clarify that binary options are not regulated by CySec and that CySec is in contact with other European regulatory bodies so as to implement the best possible practical solution for the benefit of the investors. CySec will not accept pressure from businessmen so as to take a quick decision which might include risks.

The previous official opinion of CySec which is published in CySec’s website, in the FAQ section:

Question: Are binary options regulated by CySEC?

Answer: CySEC’s current position is that binary options do not fall within the definition of financial instruments under the IFLaw 144(I)/2007 and are therefore not subject to CySEC regulation







TAGS: , , , , , , , , , , , , , , , , , , , , , , ,
 

Related posts:

More information on this subject is found in the latest Forex Magnates Quarterly Report


8 Comments on this post

Trackbacks

  1. Jude Bahnan said:

    Come to the UK – FSA will happily regulate binary options!

    March 20th, 2012 at 2:20 pm
  2. Michael Greenberg said:

    do they? i don’t think so, they’ll require you to get regulated as forex broker first

    March 20th, 2012 at 2:32 pm
  3. Stefano said:

    Honestly it is a good thing for Cyprus and for Cysec as a regulator to take some time or even to avoid regulating binary options. Having binary options regulated there, although I know that there were some consulting companies pushing for that regulation, may create credibility problems and that’s not what Cyprus and CySec want imho.

    And ps: I have never been a fan of binary options…they are more similar to gambling than investing.

    March 20th, 2012 at 5:26 pm
  4. Michael Greenberg said:

    half of cyprus banks are about to be shut down, you think BO will harm their credibility? :)

    March 20th, 2012 at 6:51 pm
  5. Stefano said:

    :D I’m not that pessimistics on cypriot banks, I think the worst is over for them and except for the greek bonds writedowns, they showed relatively good results (BoC and Marfin)…and I think Cyprus is well positioned for future growth and it would be a pity to ruin its importance as a “little” financial center with binary options.

    Basically, Cyprus in my opinion doesn’t need that type of industry. It will just create problems (credibility problems, regulatory problems etc).

    March 20th, 2012 at 7:06 pm
  6. stefan said:

    binary options are structurally no different than any other over-the-counter product/instrument, so it’s difficult to see how *only* they can be exempted or carved out from the current permissions european regulatory regimes offer providers, and which are fairly wide in scope.

    March 21st, 2012 at 8:11 am
  7. Michael Greenberg said:

    they are completely different, each provider has its own options and they are structured/priced completely differently. in spot fx eur/usd is the same asset across all providers worldwide, in binary options eur/usd can be touch or up and down or any other type of option, for different time frame and with different pricing completely – so not sure how they can really regulated them

    March 21st, 2012 at 8:43 am
  8. stefan said:

    @michael, you’re absolutely right that binaries are all structured and priced differently by the various providers, but so are cfd’s to a great extent. the difference in structure of the same sort of products is the hallmark of otc… under FSA regulations (i don’t have direct experience with CySec, but i’ve been a founder of an FSA regulated business in the past) “Options” are in fact listed as one of the “Specified Investments” they regulate: see item 83, “Options” at http://www.legislation.gov.uk/uksi/2001/544/contents/made

    the point i wanted to make is that it would seem to me that unless the FSA specifically excludes “binary options” from their definition of an “option”, they would automatically fall under it by default – this is my interpretation of the document in any case and i’d be interested to hear alternate views.

    by contrast, providers of “binary bets” in the UK (specifically IG Index) are licensed and regulated by the UK Gambling Commission.

    March 21st, 2012 at 9:49 pm

We do not store your information and we do not disclose our sources.


Leave your name/email (not required) if you'd like to be contacted about this story (will not be disclosed):



Digital Currencies

Expert Articles

Fintech, Startups & New Products

Bitcoin Picks: OpenBazaar to Launch Beta, Banco Santander to Devise Bitcoin Strategy

With Bitcoin prices stabilizing around $500 in the final week of August, news about the digital currency this week include Santander devising a Bitcoin Strategy...

University of Zurich students launch CoinBlesk, a bitcoin payment mobile app

Students from the University of Zurich have launched a bitcoin payment mobile app called CoinBlesk. The open source app allows for the instant transfer of...

Huobi’s bitVC launches “Fixed-term Financial Products” backed by mining activities

Huobi’s bitVC has launched “Fixed Term Financial Products” called “digVC” with a duration of 60 days. Also termed “The World’s First Hashing Power Mortgage”, 2000 subscriptions...

More Digital Currencies

charlie trumpess, Ariel Communications

Making the Most of Gamification: Part 2

Gamification lends itself most obviously to marketing campaigns and loyalty programs, but its scope is really limitless. The FX world relies heavily on education to...

date

First Client Meeting… Like A First Date?!

Upon starting a new job, we are very excited. We try to impress our others by speaking and acting in just the right way. But...

Juan Colon, Darwinex

Advantages And Disadvantages Of Copy Trading

Traders can collaborate with peers with the same interests, exchanging mutually beneficial trading related information. One such approach is fx copy trading, whereby “Leaders” publish...

More Expert Articles

invstr ios app

Invstr – Making Financial Trading Social One App Download at a Time

Launching recently is social finance app Invstr. The app oofers a gamified version of trading to help users sharpen their investment skills, learn about the market, and communicate with other traders.
Read more

FxPro Launches New In-House Developed Web Trader for MT4 Customers

Expanding its list of in-house developed technologies, FxPro has launched a new webtrader to clients. The trading platform replaces their previous version which was licensed from a 3rd party provider.
Read more

More Fintech, Startups & New Products

Forex Research

Recent Comments

Note: Copyright © 2014 Forex Magnates. All rights reserved.

All materials contained on this site are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of Forex Magnates. You may not alter or remove any trademark, copyright or other notice from copies of the content. All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you.Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at Forex Magnates are those of the individual authors and do not necessarily represent the opinion of Forex Magnates or its management. Forex Magnates has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur. Any opinions, news, research, analyses, prices or other information contained on this website, by Forex Magnates, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. Forex Magnates will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2014 "Forex Magnates Inc. - Home of the Forex Elite" All Rights Reserved.