This binary option is more suitable for traders who seek dynamic trading that brings immediate results. This type of binary option is the most problematic to classify as a financial instrument since it is very similar to a gambling activity.In the case of One Touch Binary Options, the trader has to predict whether the asset price will touch at least once the predefined price mark during the lifespan of the particular Touch option. This is a rather high-risk type of trade, but the payouts often get over 500.On the other hand, the Boundary Binary Option, also known as In/Out binary option, the asset price has to stay within certain boundaries which are defined by two strike prices ndash upper and lower. A positive outcome will be attained if the price finishes within the upper and lower prices at the expiration time, irrespective of the number of times that the price leaves the boundaries during the trade.The MFSArsquos proposal to assume responsibility for Binary Options in place of the LGA is important news for the industry, and the Maltese regulator will expand its own regulatory framework to ensure that investors are not misled by disreputable companies and guarantee that investors enjoy higher protection. Any person intending to provide investment services relating to Malta Binary Options, as well as companies currently licensed by the LGA, would need to submit to the normal licence application procedure as well as an extensive due diligence process to obtain an Investment Services Category 3 licence in terms of the Investment Services Act. Licence holders would be able to avail themselves of the passporting rules under MiFID so as to operate anywhere within the EU without the need for further licensing. In the case of entities which are already in possession of a category 3 investment services licence, they would need to notify the MFSA in writing as to whether they intend to conduct binary options activities or whether they already perform such activities.The licensing process entails three phases, in the same way as an application for regulation for other financial services providers which fall under the jurisdiction of the MFSA. First there is the preparatory stage, followed by the pre-licensing stage, and finally the post-licensing and commencement of business stage. The duration of the licensing process depends on the completeness of the documentation and efficiency of the applicant, and normally takes between three to six months. The Binary Options broker must comply with three essential requirements outlined in the Investment Services Act, that is:Brokers licensed to sell Binary Options in Malta must adhere to a minimum capital requirement of euro730,000 and will be subject to both on-site and off-site compliance. This would constitute a further layer of investor protection and ensure that brokers can fulfill their obligations towards their clients. Furthermore, every company that intends to offer Malta Binary Options is bound to establish physical premises in Malta.Binary options are a recent financial innovation and many investors are still reluctant to invest in binary options due to concerns about the regulatory and security issues. There is hardly any legal framework at the disposal of financial regulators, and in fact, it is only recently that the drafting of a regulatory framework to regulate binary options has started to gain momentum.MFSArsquos regulatory acceptance of binary options and its effort to develop a comprehensive online trading regulatory framework will play a crucial role in attracting online trading firms to set up a base for their operations in Malta. Malta already boasts a number of attractive features that have led numerous businesses to choose it as their domicile (such as approachable regulators, low set-up costs, an educated English speaking workforce and sound IT infrastructure), and this new development will inevitably make the jurisdiction more attractive for binary options businesses.Chetcuti Cauchi is a Malta Law Firm specialising in Malta Company Formation , Malta Tax Advisory , Malta Gaming Licenses , Malta Investment Funds , Malta Investment Services , Malta Permanent Residency , Cyprus Company Formation , Malta Yacht Registration , Malta Ship RegistrationBinary options are just like any other form of trading forex trading, CFD trading, stock trading and option trading all popular and legal forms of trading in Malaysia. Binary options are the newest form of trading and can offer some of the highest returns in the smallest amount of time compared to the other forms of trading. They are popular with people looking to trade various financial markets such as fx, gold, silver, indices, oil, shares and Bitcoin to make a quick profit or earn an extra income in their own time.To understand how are binary options legal and answer the question is binary options legit we need to look no further than the Government Regulatory bodies and authorities that oversee binary option trading. These are the same financial regulators who have licensed forex trading, commodities trading such as oil trading and gold trading, stock trading and options trading. For example the EU based CySec (Cyprus Security Exchange Commission) was the first recognized Government body to license binary options trading, with our highest rated binary option broker Banc De Binary being the first CySec regulated binary option broker. Banc De Binary currently have over 200,000 clients worldwide with many coming from Malaysia. Similarly to CySec, the FSA (Financial Services Authority) in UK, ASIC (Australian Securities and Investment Commission) in Australia and FSP (Financial Service Providers) in New Zealand just to list a few Government bodies that officially regulate numerous binary option providers.Now you know binary options legal and legit, the next important thing to consider is how do you avoid a binary option scam broker Binary option scam brokers do exist, nearly always they will be unregulated brokers based in countries like Gibraltar, Seychelles or Anguilla, places that do not have a high level of oversight of companies operating within their jurisdiction.
