what is a binary option 
binary options a financial derivative that allows people to make all or nothing wagers on events and asset price changes have surged in popularity in recent years but critics including u s regulators who have long cautioned against them warn that these trades are more akin to gambling than investing and carry a high risk of fraud and losses for unwary consumers these options depend on the outcome of a yes or no proposition hence the name binary traders receive a payout if the binary option expires in the money and lose if it expires out of the money in 2008 the u s securities and exchange commission sec approved listing binary options as tradable contracts on exchanges this move was followed by the chicago board options exchange and the north american derivatives exchange nadex offering standardized binary options to retail traders despite being available on regulated exchanges much of the trading in binary options in the u s goes through unregulated offshore platforms leading to many scams and frauds 12 binary options are banned in many places worldwide including australia canada europe the u k and elsewhere 3