Binary options and cryptocurrency – as a forbidden fruit

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Cryptoasset and cryptovalue: their essence and role

Today, the idea of ​​crypto currency has given a huge and simply invaluable impetus to the development of our economy. Crypto currency became a powerful catalyst in the development of new economic and financial assets, which became available to all comers. This is a truly new, evolutionary stage in the development of the world economy and the financial market as a whole.

With the frantic development of the market, the crypto currency and the opportunity to invest in this dynamic direction, it became necessary to introduce new financial definitions. Today you can increasingly hear about such definitions as crypto asset and cryptovalue.

So, the crypto-asset is in a certain way similar to shares. By itself, a crypto asset is a certain financial instrument, emitted only by a company or a group of people. Cryptoasset serves as a crypto currency and helps a company or groups of people to attract additional assets, investments for ideas and projects, in turn, increases the cost of crypto assets. This is also done to increase the capitalization of the company itself.
Also acquiring crypto-asset, the company or a group of people undertakes to fulfill its obligations to the owner of a crypto asset, due to the purchase of a crypto asset.

Crypto Asset has truly become a new link in the evolution of crypto currency and once again proved that the capabilities of the blockchain are much wider than we can imagine.

One of the biggest advantages of a crypto asset before a crypto currency is its security and its audit.

In the crypto-asset, the real price of the asset is laid down, which is expressed in a digital form. While the evaluation of the assets themselves is carried out with the help of audit companies, and the information itself is in an open for all access.

The stability and reliability of the crypto-active is ensured by the provision of the digital currency with real assets.

What is the basis of cryptoasset?

Goods – in this case, the goods in exchange have the ability to perform the function of money.
Assets – all movable and immovable property, the right to material or intellectual property, anything that can help increase the capitalization of the company.
Cryptography is a science that studies the confidentiality of data.

The price of each crypto-asset is influenced by the ability of the company itself to manage assets, price, liquidity, answer transparency to auditor’s conclusions, and much more on the part of the company itself.

Crypto-value is the whole system of cryptoasset properties, which determines its uniqueness among others.

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  • Binomo
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“General Risk Warning: Binary options and cryptocurrency trading carry a high level of risk and can result in the loss of all your funds.”

How does the binary options market feel after the ESMA ban

This year there was a significant event with a minus sign for traders in financial contracts. The European Securities Market Authority (ESMA), which is committed to monitoring the OTC market, has banned binary options brokers in the EU. In addition, a number of restrictions received Forex-brokers and dealing centers.

The ESMA directive consists of several guidelines:

● limitation of leverage;

● entering a standard for risk warning;

● open access to the statistics of profit / loss traders;

● prohibition of advertising;

● prohibition of bonuses and promotions;

● Protect traders from negative balance.

Restrictive measures for brokers from ESMA

The first measures to restrict over-the-counter trading were taken in July, and at the end of the summer, the regulator extended bans until the end of the year. According to the ESMA decree, binary options advertising is now banned in the EU, and CFD trading has received new leverage limits. For example, trading in major currency instruments in the European Union is now limited to 1:30 leverage. Brokers were also obliged to warn about the risks of a single standard and provide statistics on how many traders lose money on trading in financial contracts.

The ESMA decision has been brewing for a long time — trading in financial instruments has always been fraught with risks, so the main task of the service was to protect traders from large financial losses. Dissatisfaction with this decision was expressed by both brokerage companies and traders who successfully earned on trading contracts.

Restrictions on trading affected the so-called retail traders, while clients with the status of “professional” can still trade in financial assets. At the same time, traders are guaranteed protection against negative balance. In such conditions, non-European trading platforms, which are not covered by the ESMA rules, have come to the fore.

One of the points of the ESMA prohibits the promotion of clients of companies in the form of bonuses – if earlier, registering with one of the European brokers, users could receive an addition to the deposit, now it has become unavailable. It was also introduced a taboo on other customer incentives.

The ESMA restrictions bypassed countries where the financial contract market is regulated by a local authority. In Europe, this country is Switzerland, where strict regulatory rules have been in place for a long time, and companies entering the Swiss market must meet high requirements.

The ban is temporary in nature – at the moment it is valid until the end of the current year. At the same time, representatives of brokerage companies are negotiating with the department in order to achieve relaxation in restrictions and reach a consensus on the issue of providing services to traders in trading certain types of contracts.

The introduction of a minimum expiration of contracts of 90 days is considered as laxative measures, each trading instrument must comply with the European Directive (2003/71 / EC), and for companies providing brokerage services there should be no additional profit from transactions other than the established commission.

How to continue to trade contracts after the ban ESMA

Many of the bidders who reside in the EU do not want to put up with the situation, and therefore are looking for opportunities to trade without restrictions. But, as you know, the medal has two sides – on one side, the actions of the regulator are aimed at ensuring that residents of European countries do not lose money in the industry; on the other hand, tight restrictions push traders into unregulated markets, where the risk of losing money is even higher.

Brokers do not stand aside, and by feasible methods are trying to return customers. Some declare that they are not registered in the Eurozone, so the ESMA jurisdiction does not apply to them. Others hint that the regulator directive can be circumvented if desired. However, it is the first option that is most preferable, since among non-European brokers there are worthy representatives who have been working in the market for several years.

These include trading platforms that are legally based outside the European Union. These include the company Barium. The company began its activities in 2020, and over the years has achieved the location of users from Russia and the CIS countries. The fact is that this is the first trading platform focused on the Russian-speaking audience.

Binarium has loyal terms of trade. The minimum deposit is only $ 10, and the nominal value of one order starts at $ 1. To obtain a special status, you need to replenish the balance in the amount of more than $ 200, in this case, the trader will have access to special applications – the trading room and “Trends”.

Signals from a professional trader are given in the trading room and analytical reports are provided. The “Trends” application allows you to detect emerging market trends in the background, with one click to go to the asset chart and make profitable deals.

Since the Russian broker Binarium does not submit to the jurisdiction of the European Union, it is not subject to a restrictive ban on shares and bonuses. Therefore, each new client can receive a deposit bonus of 100%. In addition, Binarium arranges promotions for existing customers, for example, free tournaments with a real cash prize pool.

The withdrawal of funds is carried out on the cards of banks in Russia and the CIS countries, as well as on popular payment systems. The minimum amount for withdrawal starts at $ 5, and the transfer time from the time of the application is about an hour (for confirmed accounts).

Trading in financial contracts carries with it the risk of losing capital. This was the reason for the introduction of bans on this type of instrument in Europe. If trading is not approached seriously and opening positions at random, the loss of money will be a matter of time. But with trading skills and using indicator strategies, traders make profitable trades and get a steady income.

“General Risk Warning: Binary options and cryptocurrency trading carry a high level of risk and can result in the loss of all your funds.”

Binary vs Crypto – The Pros And Cons

Binary options and cryptocurrencies are popular choices when it comes to financial trading, both offering their unique features which hold different attractions to traders. While binary options are the more established of the two, it is fair to say that cryptocurrency trading has grown in popularity over more recent years.

It is important to recognise that when you trade in either, you are not owning the underlying asset but just trading on its price. This form of trading means that you never actually own the stock, you predict whether it will go up or down or reach a certain amount in a given time. Each come with their own set of benefits and of course, their pitfalls.

To ascertain the pros and cons of both of these trading methods and which suits you the best, we have put together this guide so that you can make an informed decision as to which suits you better and what you should be considering when choosing between binary options and crypto.

In this guide, you will learn:

    Any costs involved in each trading type Key differences and what will suit you The pros of cons of binary vs crypto trades

Take your next step:

Trading Payouts And Losses

When considering whether to trade binary options or crypto, it is essential to understand the trade payouts and losses you can encounter. Which is going to make you the most money and with one which will you have the most success? While a good winning streak of short term options can produce good profits, a swing in an ever-fluctuating world of crypto can be even more profitable.

The opposite can be said of either though if the prices go against your trading. With binary options, you can expect anywhere between 60% and 90% returns depending on the broker that you choose. Then there are small transaction fees to consider. Any commission owed will be taken before you are paid out. With crypto, the payouts aren’t entirely as predictable and can vary depending on some factors.

You should have respect for the volatility of the markets as when they fluctuate they can do so dramatically in a short space of time. It is also crucial to weigh up how much your transaction fees will affect your profits and your losses.

Buying crypto can prove quite expensive especially given that bitcoin reached $20,000 for one coin at its peak.

The Costs of Each Method

With cryptocurrency, you are speculating on the cost of the asset without actually owning it. Buying crypto can prove quite expensive especially given that bitcoin reached $20,000 for one coin at its peak, but trading in it is far less costly. There are however many fees to consider. To begin with, converting money into a Coinbase account carries a cost.

You can expect to pay $35 just as a transaction fee for entering the exchange. When you weigh up the cost of entry and exit, that’s a cost of $70. A $100 trade, therefore, is going to cost you a lot. The same value in options doesn’t carry the same level of fees. Binary options are subject to far lower transaction fees.

If you choose a broker that offers trading in your base currency, then this is a fee you can avoid. With Crypto the spreads can mount up, and the more popular digital currencies can be costly to trade in. On a positive though, the only thing that affects the price is supply and demand. As a decentralised currency, no government or authority has control, and it is purely a global asset.

Which Trading Type Suits You

Binary options could be viewed as more popular than crypto because it is undoubtedly more established. Perhaps it is easier to understand and with more knowledge and experience available out there to help you learn how to improve your trading. Cryptocurrencies are more of an unknown quantity given that they are a relatively new concept. Variety with binary options may be considered to make it more appealing.

With assets like commodities, stocks, indices and currency pairs, you can trade on lots of different assets and build up quite a healthy portfolio. In addition to the variety of assets, there are also some diverse trade types – high/low, touch/no touch, ladder options, pairs and more. With short expiry times, you can make lots of trades in a short space of time.

With crypto, while there are a few different digital assets, it isn’t quite as varied as binary. Trading depends on the sort of experience you are after. If you like the variety, then you may prefer binary; however, some people prefer the volatility of crypto and the fact that the fluctuating intraday prices can produce some healthy profits.

It’s also not subject to the same influences as binary options – there are no external factors to consider, the currency is decentralised, and you aren’t at the mercy of governments and authorities.

The Final Pros And Cons

Cryptocurrency is available globally and is a decentralised currency meaning that it has one value everywhere. There are no currency conversions or the like to be concerned about, and its traded around the clock. While this can be a good thing, the downside of this is that you can’t be active while asleep and may miss out on some great opportunities.

With binary options, at least you know when you can trade. The crypto market is very volatile and subject to fluctuating rates which can swing quite a lot in a day. Higher predictability gives the savvy trader plenty of opportunities to make a large profit or equally to lose a lot. Not all brokers will offer every type of asset in either binary or crypto. In fact, with some, you will have a much greater choice than with others.

Many brokers that offer binary, CFDs, Forex and crypto trading may provide more of one type than the other depending on when they established and what they prefer. Some will dabble in crypto and specialise in binary options.

Robert has consulted for our website for five years and is a well-established member of the team. While he is passionate about the site, most of Robert’s time is focused on his current position as CEO of a professional coaching company.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
    Get a Sign-Up Bonus Now!

  • Binomo
    Binomo

    2nd in our ranking!

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