There is an ICO going on at the moment that features a revolutionary product that will transform binary options as we know it. The product is…Betex. Betex is the world’s first blockchain-based binary options platform, poised to deliver value to all participants in the ecosystem.
Betex Labs Ltd, the company behind the Betex platform and token, has launched its Initial Coin Offering (ICO). This ICO will run from March 1-31, 2018. It will feature the sale of the Betex token (symbol: BETEX), the currency on which the Betex ecosystem will run. This token, created with the ERC20 smart contract, is being offered at a price of $3 per token. The Betex platform will be the very first attempt at correcting the presently skewed profit distribution system in the binary options market and will also introduce the transparency factor; an ingredient currently missing in binary options.
This project was conceived and developed by Betex Labs Ltd, a Hong Kong based company which is led by CEO Oleg Torkhov.
The Bankable Idea
Binary options took the world by storm in 2008, presentinga system where traders could predict options outcomes for a reward of a payout for correct choices. Selection of the wrong option led to loss of the invested amount. Brokers got compensated not just via the trading fees, but also via the lost investments of losing traders. Binary options spread across the globe and brokers setup shop in their thousands, offering their product all over the world. At the height of its boom in 2014, annual revenues from binary options trading were in excess of $30bn. But along the way, things started to go wrong.
- The Problem
The actions of unscrupulous brokers and the media exposure of several high profile scandals within the industry hit the market hard. Across board, revenues for binary options brokers have tanked. Even the regulated companies, operating in a market which has been largely unregulated, are not left out of the dip in fortunes. The figures do not lie.
- Hirose UK, the regulated UK branch of Japanese broker Hirose Tusyo Inc, reported a 47% drop in revenues for its 2017 fiscal year. This is in spite of its promotion of its regulated LION Binary – Pro platform.
- SpotOption, which at a point in time controlled the market share for turnkey binary options platform providers with $5bn in annual trading volume, saw its revenues dwindle as from 2015. The company has suffered from a lot of bad press and unwanted attention from Israeli authorities. As at January 2018, SpotOption has officially left the binary options business after raids by law enforcement agencies.
- In Japan’s tightly regulated OTC binary options market, the story is not much different. Despite a year-on-year increase in trading volumes, revenues for brokers dropped by 17.65% in February 2018 from the previous month’s figures, continuing a trend which has been seen in recent years. The Financial Futures Association of Japan (FFAJ) also indicates that the number of active accounts have fallen as well.
So what really is the problem here? Why has the binary options market taken such a big hit in the last three years? Apart from poor regulation, greed on the part of unscrupulous brokers and the deployment of illegal and immoral tactics to defraud traders, a major problem is that traders have simply grown tired of the existing compensation structure which leaves them with little and channels most of the traded funds to the brokers.
Look at what typically happens in the market:
A typical payout for a binary options trade is 80%, which drops to 65% for short term trades. A loss in a trade leads to zero payout and a loss of the invested sum. With brokers acting as the counterparties to trades, lost invested amounts end up finding ther way to the brokers’ pockets. If the trader is lucky, the price of the option may be allowed to expire at the entry value, in which case the trader gets back the initial investment without a payout. Either way, the trader must always score three winning trades for every losing trade to stay profitable, assuming investment amounts remain the same. In a situation where martingale strategies are used, the risk factor rises dramatically. There are hardly any cases of traders succeeding with Martingale strategies in binary options.
Traders competing against brokers as counterparties, with brokers also acting as umpires in trades leads to frequent and constant price manipulation from the dealing desks of brokers. A 2016 report by the Bureau of Investigative Journalism revealed that two sales agents of SpotOption (supplier of platforms to two-thirds of brokers in the industry) had in a presentation to potential brokers, indicated that only 20% of traders would withdraw profits, leaving brokers with more revenue. Here is a snippet from the Bureau of Investigative Journalism’s website, showing what it says are excerpts from a slide presentation made by SpotOption’s former Middle East Sales manager Fakhri Hussein posted online in 2013:
In essence, not only do 4 out of 5 traders lose money consistently in binary options as a result of the skewed system, but brokers using the present models could expect to make $1,600 out of every $2,000 deposit into their platforms. To think that this was actually being used as a selling proposition to convince brokers to adopt the SpotOption platform is rather sickening. It is also noteworthy that SpotOption had agreements with its broker partners where 20% of revenues made by these brokers went to SpotOption. With such pressure to perform to pay for costs of using platforms, it is not surprising that brokers began to cut corners and use various unsavoury means of making their clients actually lose money to them in various ways.
So what we have had is a systematic breach of investor trust by brokers and their platform providers, and this has led to the present situation of rampant fraud, investor apathy, dwindling revenues and a dampening of what should otherwise have been a very robust market.
- The Solution
It must be said that binary options trading has great potential for all participants if things are done by the book and according to the rules. The United States financial market and its regulators have a global reputation of featuring arguably the best environment for all market participants because the rules are enforced. Binary options are actually legal in the US, but with a caveat: it must be offered by licensed and regulated brokerages, and assets offered must be listed on US-regulated exchanges. It is based on this understanding that Betex Labs Ltd, has come up with a solution that will clean up the global binary options market, restore investor confidence, and block out all the loopholes in the existing system that has allowed unscrupulous brokers to take undue advantage of their clients.
Betex is the first peer-to-peer platform for the trading of binary options, powered by Ethereum smart contracts. In the wording of the white paper itself,
“Betex was built with a mission of bringing clear-cut transparency to the financial derivatives markets as well as creating brand new instruments that would finally put an end to obsolete shady schemes”.
So what will Betex do differently from the existing platform providers in the market?
- Betex will promote peer-to-peer trading. Binary options traders will be placing bets against other traders in the ecosystem and not against brokers, platform providers and other intermediaries. No more will brokers have the opportunity to act as counterparties and screw their traders at every turn.
- The blockchain technology backbone on which Betex runs will provide ALL participants with access to real-time price and market data, ensuring that there is total transparency in the system.
- Betex will correct the presently skewed system of distribution of pooled funds where brokers take everything and traders get next to nothing. With Betex, 95% of pooled funds will be available for winning traders. Brokers, platform providers and Betex token holders will share the remaining 5%. Everybody gets something, but traders get the most share. After all, it is their money which sustains the ecosystem and it is only fair that they get the lion’s share.
- The Betex token will be the currency of the ecosystem. No one will be required to submit any fiat currency or bank card details to any broker. So complaints of deposits being taken illegally from card information earlier provided to brokers on account opening, or unregulated brokers engaging in illegal acts such as selling credit card information of their clients to identity thieves will come to a complete stop.
- SAFT agreements are presently being worked on to ensure that the Betex platform and the Betex token comply with regulatory standards across the world.
- Payouts on winning trades are immediately and automatically paid straight to Ethereum wallets of winning traders. No delays, cancellations, bogus reasons or gimmicks! You trade, you win, you get paid. Simple!
- Lower setup costs for brokers than what is traditionally available.
Benefits of Investing in the Betex ICO
For the first time ever, members of the public can also benefit from the binary options market on a no-trade basis, by being holders of the Betex token. The Betex token is the currency on which the entire Betex ecosystem will run. It is an ERC20 token, which has already been sold to select private investors in two pre-ICO sales rounds. Presently, the main ICO sale is on and concludes on March 31, 2018. There are advantages for participating in the Betex ICO. These are listed below:
- Betex has a product which is in the beta testing stage and will hit the market in Q3 2018. By 2019, it is expected that massive adoption by brokers will occur. Brokers will come to understand that the Betex way is the future of the market, and any broker that does not offer the transparent Betex platform will not get patronage from consumers.
- Any financial market that can guarantee an opportunity to make money will be embraced by the public, as long as there is transparency and accountability. Betex has the potential to bring back those traders who have abandoned the market, and bring in new ones as well. A visit to many online forums such as Quora and Reddit will reveal that inquiries are still being made by people who want to trade binary options.
- Being in possession of the Betex token guarantees lifetime income from a binary options trading operation, as long as the pool of invested funds is maintained. With Betex being planned for widespread adoption in the market, this could lead to potentially good returns.
- Token holders from the ICO can monetize their tokens when the Betex token gets listed on selected exchanges.
Three million (3,000,000) Betex tokens (BETEX) will be offered for sale at a price of $3 per token. The hard cap for the ICO is $9million. The proposed token allocation is shown below:
Minimum purchase amount is 0.5ETH or 0.05 BTC. The ICO will end on March 31, 2018, or when the hard cap of $9million is reached, depending on which milestone is attained first. Tokens will be distributed to successful participants 7 days after the conclusion of the ICO.
For more information, or to view the company’s whitepaper, visit betexlab.com/betex-wp.pdf.