I get asked that question a lot. Let me start by asking the question, is insurance a scam? You could really insert about any industry in that question. In any industry you have folks who work hard and ripping you off (and they normally do not stay in business long) and the people who work hard and giving you good service.
Go ask those who had regulated trading accounts with MF Global or PFG if futures or commodity trading is a scam. The truth is, there are good and bad folks in ALL industries.
Binary Option Model: Expanding The Circle
What makes binary options brokers come into question is that this is a rather new industry. There are some underfunded brokers operating out there. How many underfunded brokers are there on Wall Street? These days, seems like we’ll know more and more all the time. Even HUGE companies have rotten apples who’re siphoning money outside of the vault.
If there are too many traders on one side of an option, the risk manager may close trading on that one for a time. You might see this in a tanking market when everyone is short. But hey, even Wall Street takes things on the table when the market goes heywire. Wall Street brokers might even lock you into a trade that you ca n’g get out of (meanwhile your account can be going bye bye!) During the lock down.