Back in May 2012, SpotOption was the first company to comply with the Cyprus Securities and Exchange Commission’s (CySEC) requirement to obtain a binary options license. This allowed the software provider to operate white label agreements along with rendering its binary options platform.
Just a few months later, one of the bigger brokers using SpotOption’s platform – Banc de Binary – is following these steps and has just been certified and authorized by CySEC. This is good news for binary options traders as it lets them trade with Banc de Binary’s pretty decent trading conditions and enjoy the extra security granted by the new license
Speaking of trading conditions, I should probably mention the average returns one gets with this broker: 75% on High/Low EURUSD options, 70% on 60 Second options, and 400% for One Touch. These are not the highest returns you can find on the market, yet they fall into the average percentile, making the broker pretty attractive.
Up until the middle of 2012, the binary options market was a “free state”, with no regulatory bodies interested in overseeing binary brokers. CySEC was the first one that took the decision to accept binary options as a financial instrument in compliance with the European Union’s legislative framework, and therefore require binary options brokers to get a license.
Unfortunately, for the time being CySEC is the lonely warrior in this quest and many brokers choose to take advantage of this either by registering with gambling authorities instead of with financial ones, or by not registering at all.
There is a silver lining, though: as I mentioned in another article
, the Japanese FSA is also considering binary options regulation. Right now, all new activity on this market has been put on hold until the authorities take a decision on what to do. Rumor has it that High/Low options might be prohibited at all as they are to a greater extent a form of gambling. The new Japanese regulations may also have a take on the options expiry periods (60 Second options are likely to be banned), and maximum sums traded and/or lost by the traders will probably be monitored as well.
If this new legislation is implemented in Japan, other markets may follow as well, imposing rules on binary options trading in order to keep fair operations and protect the customers. Right now, of course, I can only speculate about this – and hope to see it happen – but time will tell whether Banc de Binary was the first broker to take a strategically wise decision and get in the clear with authorities.