Bitcoin Binary Options refer to a kind of trading where you can predict the ups and downs of Bitcoin prices in a stipulated time-period. If you can estimate this rightly you can earn payoffs, but if you estimate it wrongly, you can lose investments you have made. So, every Bitcoin Binary Options comes with an expiry date when the option will be checked to determine whether the investor was right or “in the money” or if he was wrong or “out of the money”. These are referred to as binary options because you can either lose or win; there is no third option.
Should you trade Bitcoin Binary Options?
The biggest advantage of Bitcoin Binary Options is that you never have to know Bitcoin’s exact value when the timeline expires; you only have to see whether prices have come down or gone up. So, anyone can opt for this; you do not need trading knowledge and expertise to get returns. And payouts can be as high as 88% of one’s investment.
However, the drawback is that it is somewhat like gambling. If you look into binary options for trading you will realize that the trading platform enjoys an edge always over the investors. Since it is unpredictable, many nations have imposed stringent rules on Bitcoin Binary Options trades. So, before you trade, you should find out whether the exchange is regulated or not. Another downside is that this practice is highly addictive just like gambling. No matter how well-informed you are, you cannot consistently make right price predictions. The market is highly speculative and risks of incurring losses are very high. It is not a good option to trade it unless you completely understand the risks involved; learn more here. As an investor, how can you be aware of fraudulent scheme?
- The SEC has often got complaints of fraud relating to sites that allow binary options trading through online means. Some customers that have given money are encouraged by brokers to invest more money into their accounts. But, when they eventually try to withdraw the returns or the original deposit, the platforms cancel these requests, ignore their emails, and refuse to transfer money.
- There are identity theft complaints where customer details have been used for illicit purposes. Sites collect data like customer passport, credit card details and driver’s licenses. So, you must never provide confidential financial data.
- Some platforms even manipulate trading software to distort the payouts and prices.
- Some online trading platforms overstate average returns on investment. Payout structures are created in ways so that returns are actually negative causing net loss to investors.
Before you invest, you must check the background, license, and registration of the company or financial professionals. If you find that they are not verified or registered, you must avoid trading with such platforms. Binary options typically trade via specialized brokers; this means some options might not accept the country you come from and you may not be able to use your current broker for trading binary options. You must select a regulated Binary Options broker offering binaries on assets you are keen to trade in. They should offer a proper trading platform and competitive pricing.