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This past August, investors in the U.S. were somewhat quietly notified that there would be restitution funds for those who had invested via Banc de Binary. The notification came from the National Future Association (NFA), and established that if you traded with Banc de Binary, you would be entitled to receive a distribution from the Banc de Binary Restitution Fund. It’s interesting news for anyone with an interest in binary options, or a specific connection to Banc de Binary. But how did things get to this point?
While there is nothing inherently shady about binary options trading, it is true that some brokers and firms have historically manipulated figures in order to gain an advantage over traders. Binary options trading is generally unregulated, which is what makes this possible, in part. In the case of Banc de Binary, we also saw what basically amounted to large-scale false advertisement, in the U.S. and elsewhere. The organization was simply not operating on the level, and so was shut down early this year. The move was viewed as long overdue by many who keep tabs on binary options, and brought renewed attention to an industry that is, at least in some cases, in need of reform.
From that point, there weren’t really any significant developments to be had. Once a firm like this closes, it’s simply done operating completely, and those affiliated (or invested) are left to figure out how to handle the situation. It’s difficult for this to go smoothly. Belgium’s regulation firm FSMA was criticized for being a little too late, for instance, notifying investors that they should contact Banc de Binary a full month after its closure. Then again, it’s safe to assume there are other investors who probably weren’t notified about the events surrounding the broker’s shutdown at all.
More broadly speaking, it at least appears as if the closing of Banc de Binary has turned up the heat on other, perhaps similar companies – at least in some parts of the world. This summer, for example, a report at Finance Magnates indicated that the United States FBI would be “charging head first” at the unregulated binary options industry. The article further indicated that tech giants like Google were assisting in investigations, and that the U.S. government appears to have devoted “substantial” resources to the initiative.
This is not to suggest that all binary options trading platforms will be put under scrutiny, nor that all of them necessarily should. But it’s news worth keeping up with if you have any level of interest in this form of trading. A high profile shutdown appears to have put the spotlight on binary options to the extent it never has been before.