The Cyprus Securities and Exchange Commission (CySEC) confirmed on Wednesday binary options broker OptionRally has renounced its Cyprus Investment Firm (CIF) License, as of May 13, 2020.
OptionRally, founded in 2010, had acquired its CySec license back in 2013 when the now-defunct brand began to expand out of its origins in Israel.
The Cypriot watchdog made it clear that OptionRally’s surrender of the license is entirely voluntary based on the company’s decision and does not arise as a result of any regulatory action taken by the CySEC.
Although the regulator didn’t clearly state why OptionRally decided to say goodbye to its CIF authorization, the last three years saw many regulated brokers opt to voluntary surrender their license, and not as a result of any regulatory issues. The list included UBFS Invest, Spot Capital Markets Ltd, and Alfa-Forex.
In addition, following ESMA temporary measures against binary options in Europe, it has become fashionable to bash this type of trading, with most regulated brokers either shut down or phased the binaries out of their portfolio.
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In 2017, OptionRally was hit by a series of fines and license suspensions, but the CySEC ultimately cancelled its previous penalties after the firm satisfied its regulatory obligations.
At the time, the Cypriot regulator said it adopted correctives measures and actions to tackle suspicions of violations of the Investment Services and Activities and Regulated Markets Law 2007.
As reported by Finance Magnates, OptionRally was initially flagged for non-compliance and had its license temporarily suspended by CySEC following multiple violations. The initial suspension was reported as the regulator believed the binary options broker was not operating in accordance with the Cyprus’ law of protection of client funds. Additionally, the sum of the broker’s capital requirements seemed to be bigger than the firms’ own funds.
CySEC considered these breaches could jeopardize the interests of broker’s clients and interface with the capital market operation. Hence, the watchdog suspended OptionRally’s license.
In addition, CySEC fined OptionRally with €138,000 in September 2016 for violating several regulation sections. The company had been showing weakness in theses months including laying off a number of employees.
OptionRally had been involved in one of the bigger sponsorship deals in the industry with the company’s logo appearing on the Ferrari’s Formula 1 race cars.