Binary Options Legal Status Guide

Legality of Binary Options Trading Around the World

Over recent years, the binary options industry has grown by leaps and bounds. Binary options were created to be accessible. With low minimum deposits and investment amounts and the ease of clicking “High” or “Low,” it has never been easier to trade stocks, currencies, commodities, and indices.

But in some respects, binary options remain inaccessible — at least in certain jurisdictions. They exist in a murky legal area in many countries.

Not sure whether it is legal to trade binary options in your country or not? In this guide, we will go over the current legal status of binary options in major countries. Keep in mind that the legal status of binary options is changing rapidly around the globe, so this information will be updated on a routine basis.

Please keep in mind also that none of the information in this guide constitutes legal advice. We are not legal experts in any capacity, and if you choose to trade binary options or offer them to the public, you do so entirely at your own risk. We are not liable for any losses or legal consequences you may incur.

The information on this article was last updated on November 21, 2017.


Trading binary options is legal in Australia, though the Australian government does caution traders to be wary of high-risk investments.

The relevant financial regulatory body in Australia is the Australian Securities & Investments Commission (ASIC). ASIC maintains a publication called “Money Smart,” where they have published a brief for consumers on binary options.

The article makes it quite clear that it is fully legal for Australian citizens to invest in binary options. The guide does state the following:

Make sure the binary option provider has an Australian financial services (AFS) licence or is authorised by an AFS licensee, regulated by ASIC. To see if a company holds an AFS licence, search ASIC’s Professional registers.

Apparently, this is a strong suggestion, rather than a legal stipulation, but just to be safe, you should probably follow ASIC’s recommendations.

Best Practice: Australia urges consumers to think twice before investing in binary options, but takes a relatively liberal stance toward them. You can legally trade binary options if you are an Australian citizen, but you should stick with those that are regulated by ASIC or have an AFS license.


This is a country where trading binary options is flat-out illegal. As of August 2016, the Financial Services and Markets Authority (FSMA) in Belgium banned all binary options brokers from doing business with Belgium citizens.

Best Practice: Binary options trading is banned in Belgium altogether. Do not trade binary options as a resident of Belgium.


The Canadian government is not fond of binary options. As such, there are a lot of restrictions in place for both brokers and traders. This is somewhat surprising considering how many Canadian binary options traders there are.

The main regulatory body in Canada in charge of handling binary options concerns is the Canadian Securities Administrators (CSA).

Back in 2015, CSA released an investor alert at the Ontario Securities Commission. If you click through, you will see that the article states that the CSA warned traders to “exercise caution when considering an investment in binary options.”

At the time that alert was published, it was evidently still legal to trade binary options as a Canadian citizen — even if doing so was disapproved of by the CSA.

Update: Another, more recent article from September 2017 states that “…there are no registered individuals or firms permitted to trade binary options products in Canada.”

So there are no Canadian-regulated binary options brokers right now. That sentence also seems to imply that trading binary options may be illegal altogether (including for individuals), but this may just be unclear wording.

What is confusing about this is that the subject of the article in question is a ban, which the CSA has just put on advertising, offering, selling, or trading binary options shorter than 30 days.

Does this imply that it is still legal to trade long-term binary options? Presumably, but it may be best to await further clarification from the CSA.

Best Practice: If you are a Canadian citizen, whatever you do, do not trade binary options shorter than 30 days in duration. You may also want to play it safe and wait for further statements from the CSA before you consider trading long-term binary options.


In Cyprus, binary options brokers are regulated by the Cyprus Securities and Exchange Commission (CySEC). CySEC is notoriously loose about its regulatory criteria, which is why most binary options brokers seeking regulation choose to go through CySEC.

As a result, trading binary options in Cyprus is not a problem. CySEC would of course like you to go through their regulated brokers.

Update: In February 2017, it was announced that CySEC is thinking of making sweeping changes to how binary options are regulated in the country. The proposed changes would act to protect traders — including very useful reforms like forcing brokers to allow customers to leave trades at any time.

Head of CySEC Demetra Kalogerou has also been quoted as saying, “It will be more appropriate to suggest binary options only to professional traders” at iFX Expo International 2017. It was interpreted by some publications to imply that CySEC is thinking of banning binary options altogether. Her statement is actually quite vague though — so there is no reason to go into a full-on panic. Traders will have to wait and see what transpires.

Best Practice: If you are a citizen of Cyprus, you can trade binary options. Try and stick with a regulated broker.


In 2016, the regulatory body Autorité des Marchés Financiers (AMF) implemented a ban on advertising of all binary options, Forex and CFD products which included leverage at levels of 1:20 and up.

While this actually would not necessarily imply that allbinary options are banned, AMF also published an extensive list of unauthorized binary options brokers in 2015.

While the list certainly does not include every broker under the sun, it is clear that AMF tried to be very thorough when compiling it.

At the bottom of the list, AMF wrote:

Any unauthorised intermediaries [brokers] run the risk of criminal sanctions. If the intermediary in question is not on these lists, we strongly recommend that you do not respond to their offers.

Since that list was published, AMF has continued to print additional warnings with more binary options brokers identified.

So is binary options trading illegal in France? Not yet. However, it is certainly illegal for binary options brokers not regulated in Europe to offer services to French customers.

Best Practice: France seems pretty dead-set against binary options trading. You probably should only trade binary options in France if you the broker has a valid European Union license and complies with all AMF regulations.


Israel is a somewhat fascinating player in the binary options world. Binary options has become a huge industry in Tel Aviv. Thousands of people have relied on it for their income.

But that is all going away now. The problem is that Tel Aviv became binary options scam central. While the industry propped up the economy, it also robbed a lot of traders blind. So, the government decided to act.

In October 2017, Israel’s parliament passed a ban which prevents Israeli brokers from doing business with customers overseas. Serious penalties will be assessed against offenders, including potential imprisonment.

What about Israeli customers? Israel Securities Authority (ISA) banned binary options firms from doing business with Israeli citizens in March 2016.

So, if you are Israeli, you cannot trade binary options. You also cannot sell them to customers domestically or abroad.

Updates: Are binary options really finished in Israel? Maybe, maybe not. Finance Magnates recently ran an article which includes an upload of a relevant Israel Supreme Court decision made in response to a petition.

This decision calls for the Knesset and the Israel Securities Authority (ISA) to essentially clarify why the ban is required, and whether it might not make more sense to consider regulating the industry instead of shutting it own.

There are around 4,700 employees working at 70 brokers in Israel, making it a major part of the country’s economy. When the ban goes into effect on January 26, 2018, it is going to cripple that segment of the economy, possibly with devastating ripple effects.

The Knesset and the Israel Securities Authority will need to respond to the court by January 10.

Best Practice: Do not trade binary options if you reside in Israel.


In Japan, the regulatory body which is responsible for addressing binary options is the Financial Futures Association of Japan (FFAJ).

Japan has not placed any sort of ban on binary options trading, though it does have a lengthy document stipulating the rules for over-the-counter binary options transactions with Japanese customers. For example:

  • Binary options trades should never be shorter than 2 hours in length.
  • Pricing and payout information should be transparent.
  • Clients should be assessed before they are offered services.

If you are a resident of Japan and you want to trade binary options, you should go over this document (FFAJ Guidelines for OTC Binary Options Transactions) in-depth to make sure that you are dealing with a broker that is following the rules.

Best Practice: You may trade binary options in Japan, but you need to make sure that you are doing business only with companies which observe the guidelines set by the FFAJ.


The regulatory body you should familiarize yourself with in Malaysia is the Bank Negara Malaysia, which is the central bank of Malaysia.

The Bank Negara Malaysia seems to have very little to say regarding binary options at all. If you run a search on the official site, very little comes up.

One possibly-relevant article is the one on illegal Forex trading. Here is one passage:

Illegal Foreign Exchange Trading Scheme refers to the buying or selling of foreign currency by an individual or company in Malaysia with any person who is not a licensed onshore bank or any person who has not obtained the approval of Bank Negara Malaysia.

From this statement, it seems reasonable to assume that one should trade with caution in Malaysia, dealing only with licensed companies.

Best Practice: Before you trade binary options in Malaysia, run a search on the company you are thinking of using to see whether they have obtained the central bank’s approval.


Malta is a country which comes up pretty often in discussions concerning binary options regulation. This is because it is one of the few which actually offers a regulatory framework.

Originally, binary options in Malta were categorized as gaming products. But in 2013, the Malta Financial Services Authority (MFSA) announced that binary options would henceforth be categorized as investment products subject to Markets in Financial Instruments Directive, 2004/39/EC, (MiFID) rules.

Like CySEC in Cyprus, MFSA actually licenses binary options providers with the licensing criteria for assessing the applicants available publicly.

MFSA has also posted a notice to the general public about binary options, Forex, CFDs, and “other speculative products.” If you are trading with an MFSA-licensed broker, that company has met those criteria in order to qualify for their status.

In this notice, MFSA simply underscores the high risk nature of these investment products. The notice concludes with the following advice:

The MFSA strongly advises investors and potential investors to exercise caution and be vigilant when seeking to invest in these speculative products and to ensure that the provider is duly authorised to offer services in relation to these products.

So, citizens of Malta may invest in binary options, but the MFSA would only like consumers to deal with regulated providers.

Best Practice: If you are a citizen of Malta, you can trade binary options. It is best to use a regulated broker.


The Netherlands is another country where binary options are essentially banned. The relevant announcement was made on September 16, 2016, by Minister of Finance Jeroen Dijsselbloem while taking questions from Parliament. Dijsselbloem said during the session that he would be partnering with the Netherlands Authority for the Financial Markets (AFM) to set up an advertising ban on binary options.

Merel van Vroonhoven, chair of the AFM Executive Board, stated:

We consider it very important to introduce an advertising ban on binary options and other toxic investment products. Advertising for these investments entices consumers with the prospect of earning money fast, but it is actually the case that you can easily lose all of the money you have put in.

This is pretty broad-sweeping and decisive. The Netherlands clearly is working to ban all binary options products.

Best Practice: Do not trade binary options in the Netherlands. This country is in the process of instituting an all-encompassing ban.


Russia is a country that has taken scarcely any interest in binary options regulation to date. This is one of the reasons you may notice that a lot of brokers target Russian customers.

In theory, regulation of binary options trading in Russia would fall under the authority of the Central Bank of the Russian Federation.

Presently, the central bank comments on binary options, but has nothing to do with actual licensing or prosecution, domestically or with respect to foreign brokers.

As a result, binary options trading is something of a free-for-all in Russia. Indeed, Russian traders need to be extra wary of binary options scams for just this reason. There is no protection from the Russian government.

Update: There have been reports (rumors) that Valery Lyakh, Head of the Department for Countering Malpractice at the Central Bank of Russia, has started to take an interest in binary options. Apparently, Lyakh is concerned about Russian citizens being scammed by brokers.

Also relevant is the article in the Financial One magazine. The article includes a number of quotes from Sergey Shvetsov, the first deputy chairman of the Russian central Bank. The article states that Shvetsov, “promised that in the near future, binary options and CFDs will be banned for sale to unqualified investors.”

So it is possible that the Bank of Russia will start looking into establishing a regulatory structure soon. We will keep you posted.

Best Practice: If you are a Russian citizen, you are free to trade binary options anywhere you want. Just make sure you do your homework and pick a trustworthy broker that is not going to scam you.


The relevant regulatory body in Singapore, when it comes to binary options, is the Monetary Authority of Singapore (MAS). On the whole, the MAS has been very lax about binary options.

Updates: In March of 2017, the MAS issued a warning to investors concerning binary options trading, specifically on platforms which are unregulated. This warning was released in response to complaints received by the MAS.

Best Practice: As advised by the MAS in the linked notice, Singapore citizens should only trade with binary options brokers that are regulated and listed in the MAS Financial Institutions Directory. Citizens should also avoid those which are listed in the MAS Investor Alert List.

South Africa

In South Africa, the agency in charge of financial regulation is the Financial Services Board (FSB). From what is known at this point, the FSB is not particularly involved with binary options and does not currently regulate any binary options brokers.

The FSB does routinely issue warnings to the public about doing business with various binary brokers. For example, FSB warned traders against Binary Tilt in September 2017.

The FSB usually concludes these warnings by reminding the public that one should always look up a broker with the FSB to check whether they are “authorized to render financial services.”

As such, it seems the FSB would prefer that traders in South Africa only do business with companies regulated by the FSB. But it can also be inferred from these specific blacklist warnings that the FSB has not instituted a complete ban on binary options trading.

Best Practice: The FSB’s position on binary options is extremely vague. It appears you can legally trade if you are a citizen of South Africa, but you should exercise caution.

United Kingdom

In the United Kingdom, it is the Gambling Commission which regulates binary options brokers. But this is only the case if the brokers have remote gambling equipment located within Great Britain.

Traders can search the database of license holders before opening an account.

If a broker’s all equipment located outside of Great Britain, the Gambling Commission does nothing to regulate them.

The Gambling Commission is quite clear about the legality of trading with these brokers from within the UK:

This means that, although consumers in Great Britain are able to use the services provided by these operators, we do not regulate them.

In short, if you are a UK citizen, the Gambling Commission does not care whether you trade with overseas brokers or not — for now.

Update: Right now, there is an amendment up for consideration regarding the legal status of binary options in the UK. If the amendment passes, binary options in the UK will no longer fall under the Gambling Commission’s regulatory oversight, but will instead be transferred to the Financial Conduct Authority (FCA). Do not be surprised if this means tighter regulations both for UK-registered brokers and UK traders.

Best Practice: For now, UK citizens may trade with any brokers, whether they are regulated in the UK or not.

United States

In the United States, the Commodity Futures Trading Commission (CFTC) is in charge of regulating futures, swaps, and other financial markets.

On binary options, CFTC says:

It is against the law to solicit U.S. persons to buy and sell commodity options, even if they are called ‘prediction’ contracts, unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt.

It is difficult to interpret this, but it should be noted that the key word here may be “solicit.” Basically, it is against the law for brokers to deal with USA customers unless they are approved by the CFTC. The CFTC regularly penalizes companies that break this rule quite harshly.

The CFTC also maintains the Fraud Advisories page for consumers. The main idea of the advisory is summarized in the following paragraph:

Because of their lack of compliance with applicable laws, if you purchase binary options offered by persons or entities that are not registered with or subject to the oversight of a U.S. regulator, you may not have the full benefit of the safeguards of the federal securities and commodities laws that have been put in place to protect investors.

This does not actually state that trading with an unregulated broker is illegal. It essentially implies, “let the buyer beware.”

The CFTC does suggest that US traders take the following steps before trading binary options:

  1. See if the platform is registered with the SEC.
  2. Make sure the platform is an actual exchange.
  3. Find out whether the platform is a designated contract market.
  4. Use the BASIC database provided by the National Futures Association (NFA) as well as FINRA’s BrokerCheck to verify the status of a broker.

Right now, very few brokers are registered with the CFTC. The main one is the North American Derivatives Exchange (NADEX).

Updates: As of December 2017, the CFTC has added another 21 binary options sites to its RED List. This list is essentially the regulator’s blacklist; it is a list of brokers which the CFTC has identified as offering services to USA customers without registering first with the CFTC. There is no change in policy here, just a growing crackdown.

Best Practice: If you are a US resident, you are best off trading with a broker which is operating legally. That means a CFTC-registered broker like NADEX.

General Updates

Get Ready for MiFID II

A massive sweeping change is coming to the financial markets in Europe as of January 3, 2018, and that is the introduction of MiFID II.

In case you are not familiar with MiFID, it stands for “Markets in Financial Instruments Directive.” MiFID went into effect in 2007, and applies across the entire European Union. It is a regulatory framework which helps to reduce abuses in European financial markets while setting authorization requirements and boosting transparency.

MiFID II is a revision to the original MiFID, and will seek to provide even more transparency in the markets.

The impact that this new regulatory framework will have on the binary options industry will doubtless be complex. Actually, some of those changes have already taken place. You may have noticed for example that a lot of binary options brokers have thrown out match deposit bonuses with high turnover requirements. This is in response to MiFID II rules.

Basically, compliant brokers are no longer allowed to tie up your withdrawals through bonus programs. And that is a good thing.

For that reason, you should not be alarmed by the implementation of new regulations throughout the European Union — or the tightening of binary options regulations elsewhere around the world. These changes are aimed at consumer protection and should ultimately play to your advantage as a trader.

December 2017: ESMA Takes Major Action Against Binary Options

A major blow to the binary options industry was struck this month when the European Securities and Markets Authority (ESMA) released an announcement wherein it was stated that they were thinking about banning binary options outright.

This news does not come as a surprise. There has been speculation throughout 2017 that the ESMA might be planning something like this.

Along with possibly banning binary options, the ESMA has announced that it plans to restrict leverage on Forex and CFD products.


Q: Can I get around my country’s ban on binary options?

A: It can be frustrating to find out you live in a country, which has completely banned binary options. This may make you wonder if you can just use a VPN to access an offshore broker and make a deposit.

While this may seem tempting, you should not do it. First of all, at some point (probably when you withdraw), the broker will require you to verify your identity. At that point, you will be unable to complete the process. You might lose your investment, and/or get banned from the platform.

Secondly, you could be reported to your country’s authorities, and might incur a penalty as a result.

Q: How do I know a regulator is legit?

A: Sometimes while you are researching binary options brokers, you might stumble across “regulators” that do not appear to have any financial authority. This may leave you feeling a little confused.

One example is the Financial Market Relations Regulation Center (FMRRC) in Russia. On first glance, this might sound like a real regulatory body. But if you look a bit closer, you will discover it is not one.

The FMRRC is an independent non-profit organization. It was put together to provide certifications to binary options brokers in Russia since the Central Bank of Russia does not provide any sort of legal regulatory status. In fact, it was actually a broker that started the organization.

To that end, the FMRRC has no legal authority. It is not a real regulator. It does offer oversight, but it is hardly unbiased, and the interests of brokers are the overriding concern, not the interests of consumers.

It is totally up to you if you want to take certifications like those offered by FMRRC seriously. Just remember that membership in an organization like this does not represent real regulatory status.

Real regulatory bodies are always either government entities or long-established independent organizations that work closely with government authorities to provide fair, consumer-centric oversight.

Q: What if my country’s stance on binary options is unclear?

A: You should never take any chances. In a lot of countries, binary options exists in a legal gray area. If you are unsure if what you are doing is legal or not, always call the financial regulatory agency in your country and ask directly.

The Bottom Line

For now, trading binary options remains legal in most countries around the globe — with a lot of restrictions and caveats. In most countries, the smart move is to play it safe and use only regulated binary options brokers. If in doubt, always contact your country’s financial regulatory authority and ask questions before you engage in new investments. Good luck, follow your country’s laws, and stay safe.

Read more articles on Education.

Binary options trading involve risk. Although the risk of executing a binary options open is fixed for each individual trade, it is possible to lose all of the initial investment in a course of several trades or in a single trade if the entire capital is used to place it. It is not recommended to base your investment decisions on any information presented on or originating from By browsing this website you express your acceptance of the terms of this disclaimer and that cannot be deemed responsible for any losses that may occur as a result of your binary option trading. is not licensed or registered as a financial consultant or adviser. is neither a broker, nor funds manager. The website does not provide any paid services. All content of is presented for educational or entertainment purposes only.

General Risk Warning: Trading in Binary Options carries a high level of risk and can result in the loss of your investment. As such, Binary Options may not be appropriate for you. You should not invest money that you cannot afford to lose. Before deciding to trade, you should carefully consider your investment objectives, level of experience and risk appetite. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to Binary Options or (b) any direct, indirect, special, consequential or incidental damages whatsoever. is compensated partially through the affiliate commission earned from some of the listed brokers.

© 2012–2018 Binary Trading.
0 0 0 0
Binary Trading