

Show HN: Bitcoin Binary Options Exchange - locksley
http://www.futureblock.com/options/btc_usd

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Aqueous
It wasn't the monopolisation of currency or governmental regulation that
caused the financial crisis - it was derivatives, and too many people using
them off-load their risk to too few people(i.e., AIG)

You can avoid this by attracting a large number of risk-takers who diversify
their holdings. But, that doesn't obviate the fact that too little derivative
regulation caused the financial crisis, not too much.

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jboggan
Why did you revamp the site from its setup 4 weeks ago? Why the switch to this
"options" form over the previous parimutuel betting scheme?

Where are you operating out of? I'd be really careful operating this sort of
thing without legal protections.

It doesn't seem like you have much capital committed to taking these bets. How
are you calculating your risk exposure?

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bcoates
These options are based on the spot price of another exchange, rather than
being tied to a futures contract or something you could actually settle by
trading USD for BTC or back. You aren't actually buying or selling an option,
but gambling on how much you would have made or lost with a given option
trading strategy.

This is known as a "Bucket Shop" and is a classic scam.

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wangchong87
I can see Binary Options have limited hedging value as compared to Vanilla
Options. But it's incorrect to label it as a scam.

Most futures/options on "traditional" markets are settled in cash rather than
physical delivery.

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bcoates
There's nothing wrong with settling in cash. There is something wrong with
failing to maintain the separation between marketplace and counterparty.
There's no meaningful settlement at all here; there is literally no way to get
USD into or out of this site--you just get BTC back on take-it-or-don't terms.

You're playing craps, only the dealer rolls the dice for you behind a screen
and tells you if you won or not.

I wasn't familiar with the specific subspecies of this called "Binary Options"
before, but even basic investigation makes it clear that yes, Binary Options
are a scam product. There do not appear to be any legitimate binary options
marketplace/peddlers.

There's no reason you couldn't structure an exactly equivalent product out of
legitimate securities, so there's no reason for this product to exist outside
of running cons.

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Anderkent
> You're playing craps, only the dealer rolls the dice for you behind a screen
> and tells you if you won or not.

Huh? If I understand this correctly, you win if the price on mtgox goes above
a certain strike range. That's public information, so surely you can check
yourself if you won or not?

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pyalot2
Will be taken down by the SEC in 3, 2, 1...

