ESMA Issues Binary Options Warning, Threatens CFD Leverage Limits

The share prices of leading retail financial trading operators were battered on Monday after the European Securities and Markets Authority (ESMA) signalled it was considering banning binary options and imposing much tougher limits on contracts for difference (CFDs).

In an update published on Friday last week ahead of a short consultation period due to begin in the new year, ESMA said it had continuing concerns about “speculative products” such as CFDs, rolling spot forex and binary options being offered to retail clients.

ESMA said it was considering banning binary options altogether, along with harsher measures to clampdown on CFDs, including strict leverage limits which would restrict the amount consumers can borrow to leverage their bets.

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