Trading binary options is legal almost everywhere and at worst it is a grey area in a few countries in which there are no laws that make it expressly legal or illegal.
The only people that can come under legal scrutiny for binary options is the broker giving customers a way to trade, not you as an individual trader. No one has ever, or will ever, be charged for trading binary options.
Broker licenses
Most government currency binary options brokers get their license and legal status from the Cyprus Securities and Exchange Commission or the Malta Lotteries and Gaming Authority. Both of which operate under European Union laws and regulations.
Crypto has made these high charging restrictive nation state based authorities redundant and Crypto only brokers can operate safely and honestly with licenses that allow them to have anonymous traders which is much better for the traders privacy and security.
Binary option taxes
Only a tax agent in your country can tell you how profits from trading binary options should be reported to the tax man, but in most cases it is tax free unless it is part of a business.
There is debate about whether income from binary options trading should be taxed as gambling income or in the same way as income from investments is taxed.
Not only does this distinction greatly affect tax rates for winnings but it also determines the ability to claim losses as deductions against other income.
This also raises the awkward question how much of what the Wall Street traders and hedge fund industry do could also be called gambling. In all cases they are ways to take an opinion about an uncertain future event and place a monetary consideration on it with the possibility of profit or loss.
Crypto’s anonymity may help minimize your tax liability.
About Eugene Abungana
I have worked with several companies in the past including Economy Watch, and Milkroad. Writing for BitEdge is highly satisfying as I get an opportunity to share my knowledge with a broad community of gamblers.
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