ESMA Sets A New Date To Ban Binary Options

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ESMA Sets A New Date To Ban Binary Options

ESMA extends the date of banning Binary Options Trading to April 1, 2020.

ESMA stands for European Securities and Markets Authority, which is a Financial Regulatory Agency at European Union.

It is an independent European Authority. Their mission is to enhance investor protection and promote a stable and orderly financial market.

From July 2, 2020, ESMA restricted any type of marketing and selling of Binary Options products to retail investors. However, they decided to extend the date further 3 months from February 2, 2020.

The regulatory agency also restricted leverage on CFDs. The restriction starts from August 1, 2020.

As per their Press Release:

“ESMA has carefully considered the need to extend the intervention measure currently in effect. It considers that a significant investor protection concern related to the offer of binary options to retail clients continues to exist“.

The new extension date was agreed by the by ESMA’s Board of Supervisors on 7 November 2020.

They already published an official notice on their website.

ESMA has taken various significant steps to protect the clients money. For the CFD traders, the steps will protect traders and also give assurance that they will not lose more than their investment.

Binary Options trading bears a high risk. For the characteristics of this trading product, ESMA decided to ban for a while.

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ESMA Sets A New Date To Ban Binary Options

The European Securities and Markets Authority (ESMA) has agreed to renew the prohibition of the marketing, distribution or sale of binary options to retail clients, in effect since 2 July 2020, for a further three-month period.

ESMA has carefully considered the need to extend the intervention measure currently in effect. It considers that a significant investor protection concern related to the offer of binary options to retail clients continues to exist. ESMA has therefore agreed to renew the measure from 2 April 2020 on the same terms as the previous renewal decision that started to apply on 2 January 2020.

The renewal was agreed by ESMA’s Board of Supervisors on 14 February 2020.

Next steps

ESMA intends to adopt the renewal measure in the official languages of the EU in the coming weeks, following which ESMA will publish an official notice on its website. The measure will then be published in the Official Journal of the EU and will start to apply from 2 April 2020 for a period of three months.

ESMA announces start date of binary options ban

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The European Securities and Markets Authority (ESMA) has announced that its ban on binary options will start from 2 July 2020 onwards.

This ban will last an initial three months and renewed as ESMA deems necessary.

Once the ban comes into effect, we will no longer offer binary options on financial assets to retail clients residing in the European Union (EU). All open trades will be carried to term.

Looking forward

We are working hard to implement products such as lookback options, spot FX, and contracts for difference (CFDs) for retail investors in the EU, in line with the appropriate regulations.

We will also continue to offer binary options on Volatility Indices which remain unaffected by the ESMA ban.

Retail clients may also upgrade to professional client status in order to continue trading binary options on financial assets such as currencies and indices.

We thank all affected clients for their patience and understanding in this matter.

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