Betting Business explores proposed solutions to the issue of binary options in the wake of operator scandals across a number of regions.
We’ve all read the horror stories: vulnerable elderly folks losing their pension funds; young impressionable folks ensnared by seeming ‘get-rich-quick’ schemes. It would certainly be fair to say that a small number of operators in this sector have not endeared themselves to the public – or the media.
Now, regulators around the world are looking for solutions – and with countries such as Israel already drafting a bill to ban binary products outright and others such as Canada looking at an advertising clamp-down, politicians are hopeful that the era of black-market scammers could be coming to an end.
There are, however, those who say that a problem created by a few cowboys should not reflect unfairly on the industry as a whole – and they have a point. Stakeholders such as Jaron Veelo, managing director at regulated binary firm Fidelisco Capital Markets, argue that a disproportionate response from regulators will drive binary even further underground, resulting in fewer (if any) player protections. They, too, make a very good point.
What’s increasingly clear is that a wild-west style unregulated environment is not sustainable – and that it’ll take the careful crafting of business-friendly regulation to bring binary operators into the same realm of compliance as other gambling and trading firms.
If everyone follows the same framework, a few bad eggs won’t be allowed to stink out the entire basket. In the end, it’s no longer a question of whether binary options should be regulated under a financial conduct authority or a gambling authority. What’s important is that players can trust the firms they use – and that there’s a decent level of clarity about the amount of money that stands to be won, or lost.
A blanket ban on financial betting products would be disproportionate and counter-productive. But, as many industry stakeholders are already saying, things cannot go on as they are.