The binary options trading industry is an incredibly easy concept that sounds ideal for anyone who wants to participate in the market with little prior experience. In hindsight, with the simplicity of the process, it’s no wonder how big the industry became. And with how big the industry became, it truly is no surprise that it became one of the biggest breeding grounds for scammers worldwide. Although trading platforms such as Nadex are still fantastic, legitimate trading services, you still need to be wary of the majority of binary options companies out there. So, let’s take a look at the industry as a whole and get a better understanding how all this happened.
SpotOption, an Israeli based software company and platform provider, was responsible for the white label layout used by most of the fraudulent binary options scams. At one point, it provided the platform for 70% of the binary options brands out there. They created a template that any binary options company could use. A turn key solution where all you have to do is fill out your brand logo on the white label and boom – you’ve got a personalized binary options company ready to “trade”. The scammers within the industry started out small, but over time it became the norm. Now, these platforms are almost all smoke and mirrors designed to trap the investments of victims of this fraud.
Kingmaker, Bank Breaker
The most important thing a business can have is good marketing. Everyone wants their name to be the most well-known and that’s where affiliate marketing comes in. As binary options companies began competing for web traffic, the competing price for affiliate marketing steadily rose. As scammers offered larger and larger sums for advertising, legitimate companies had a choice to make: either to lose all traffic and essentially go bankrupt or become fraudulent themselves in order to rake in traffic and keep the lights on.If you can’t beat them, join them. Sadly, the second option tended to be the road more traveled by, and millions of people have been defrauded as a result.
What Is Happening Now?
The binary options market is under siege by governments and authorities all over the world. The FBI, the Israeli police, the London police force, and countless others have been cracking down on these fraudulent operations more and more, with a series of raids and arrests happening since early 2017 on both sides of the Atlantic. With the binary options ban in Israel, the main haven for these scammers, operations are closing down or moving overseas to places with less regulation, like Romania. A simple search on job forums in Israel and you can see for yourself there are many “opportunities” to work abroad – forex/binary experience a plus. Binary options fraud has taken a hit, but the multi-billion-dollar crime wave is far from over.
What Will Happen?
With the downfall of the binary options industry and the survival of the scammers, the binary options fraudstersare quickly pivoting into a new scam: cryptocurrency. Using the same old tactics, the same fraudsters, and the same technology, the scam continues under a different name. Remember that you only need to make a single mistake in order to fall victim to binary options scams and to be as vigilant and educated as possible.