Germany plans to ban binary options. Just in case
The German financial regulator, BaFIN, announced that it has plans to introduce its own restrictions on binary options. A ban on the advertising, distribution and sale of binary options in Germany for persons classified as "retail investor" is under consideration.
If ESMA changed her mind ...
The operation of the German BaFIN is to be a kind of plan B in a situation where ESMA withdraws from its product intervention applicable throughout the European Union. The ban on binary options has been in force since July 1, 2018, but officially it is only temporary. A one-off "extension" is only valid for 3 months, ESMA can take it indefinitely. At the moment, another expiry date restrictions related to popular "binaries" expire at the end of March 2019..
Nevertheless, the German regulator prefers to protect itself from a situation where the European supervisory authority would suddenly change its mind.
Elisabeth Roagele, executive director of BaFin:
"Binary options are an attractive instrument for retail customers, especially in the environment of low interest rates. Accessing them from the level of online platforms is extremely simple, offering large levels of return. Practice shows, however, that for most investors these instruments turn out to be risky and lead to loss of capital. "
At the moment, the door handle has not yet been taken and the regulator has launched a public consultation with representatives of the Forex / CFD / binary options and institutional clients who can submit their comments on the proposed changes to December 20.