From the Wires
Nadex Commends The CFTC's Action Against Unregulated Binary Option Platforms
By: PR Newswire
Nov. 27, 2012 12:43 PM
CHICAGO, November 27, 2012 /PRNewswire/ --
As the only CFTC-registered exchange that provides retail traders with direct membership and the opportunity to trade a complete array of binary options on forex, commodity futures, stock index futures and economic events, the North American Derivatives Exchange, Inc. (Nadex) commends the U.S. Commodity Futures Trading Commission (CFTC) for its aggressive action yesterday to protect U.S. traders.
The CFTC filed a civil Complaint charging two companies based in Ireland, Intrade and Trade Exchange Network, with offering commodity option contracts to U.S. customers for trading, as well as soliciting, accepting, and confirming the execution of orders from U.S. customers, all in violation of the CFTC's ban on off-exchange options trading. In announcing this action, the CFTC's Director of the Division of Enforcement stated, "It is against the law to solicit U.S. persons to buy and sell commodity options, even if they are called 'prediction' contracts, unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt."
As a Designated Contract Market and a registered Derivatives Clearing Organization subject to regulatory oversight by the CFTC, Nadex fully supports the US regulator's efforts to crack down on illegal off-exchange market activity, particularly when that activity is directed at retail traders. Timothy McDermott, Nadex's Chief Regulatory Officer, stated: "Recent events have demonstrated the importance of regulation and oversight to protect the markets and especially the retail trader from fraud and abuse. The marketplace has seen a proliferation of unregistered platforms offering binary options to US residents and this action by the CFTC sends a strong message to the operators of those platforms that such activity will not be tolerated."
Futures and options trading involves risk and may not be appropriate for all investors. The contents hereof are not an offer, or a solicitation of an offer, to buy or sell any particular financial instrument listed on Nadex.
Nadex, headquartered in Chicago, is subject to regulatory oversight by the CFTC. Through Nadex, traders can hedge against or speculate on price movements in the currency, commodity, event, and equity index markets with low collateral requirements and capped risk.
Nadex lists a range of binary options and bull spreads. Nadex binary contracts are essentially all-or-nothing propositions, paying out either a fixed amount when the trader finishes "in the money" or zero if the trader finishes "out of the money." Nadex spread contracts have a variable payout. These contracts offer the opportunity to maximize trading exposure within a strictly limited risk trading arena.
To learn more about Nadex, please visit http://www.nadex.com.
For information on becoming a Nadex member, call +1-877-776-2339 or e-mail firstname.lastname@example.org
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