Binary Options Trading In The UK

Binary options have proven popular with traders in the UK, combining fixed potential returns with losses limited to the initial stake. Traders answer a straightforward yes or no proposition, such as will the price of the FTSE rise or fall over the next 4 hours?

However, binaries have undergone increased scrutiny from the UK’s Financial Conduct Authority (FCA) over the years. This guide for beginners explains how these short-term trading products work and unpacks the current rules for British traders.

Best Binary Options Brokers in the UK

The providers listed below are the highest-rated binary trading platforms based on our hands-on tests, conducted by experienced binary traders from the UK. Note that although these firms accept British traders, they are not regulated by the FCA.

What Are Binary Options?

Binary options are a form of financial betting with a binary outcome. There is a predefined and clear indication of the risk and reward, as the investor knows exactly how much money is at stake and how much profit they stand to make.

Binaries are a high-risk, high-reward form of online investment. The trader predicts the direction the price of a British stock, for example, will move. If their prediction is correct, they win the predefined amount of money, but if the prediction is wrong, they lose the capital they invested.

Contracts for binary options in the UK are available on popular financial markets, allowing traders to speculate on the price movements of stocks (AstraZeneca, BP etc.), indices (FTSE, DAX etc.), forex pairs (GBP/EUR, GBP/USD etc.), and commodities (silver, gold etc.).

Today, cryptocurrencies like Bitcoin and Ethereum can also be traded with binary options products.

Types Of Binary Options

There is a range of popular binary options contracts available at brokers that accept UK traders, including:

• High/Low – You predict whether the asset will trade above or below the current market price when your option expires. Contract expiries generally range from just 3 seconds up to 1 month or sometimes longer.
• One-Touch – You predict whether or not the asset will reach a set target price. If it hits that price (or misses it) within the expiry time, you win the option. The asset does not have to remain at that target price, you win if it touches it even for a split second.
• Boundary – You define a price channel around the current market price and predict whether the asset will stay within or break out of this channel. If the market price leaves this channel at any point before expiry, you win (or lose) the option. This is the only type of binary option where two target prices of equal distance are set, and you do not have to predict the direction of movement.
• Ladder – These binary options often define five or six target prices. You predict whether the asset will be trading above or below each of these prices when the option expires. This type of contract allows you to combine risky predictions with high pay-outs, as each rung behaves like a high/low option, the target price just gets further away each time you move up the ladder.
• Short Term – These binary options in the UK cover any expiry of fewer than 5 minutes. The most popular are 60-second options, but they can range anywhere from 3 seconds to 300 seconds. They work in the same way as high/low options.
• Long-Term – These generally have expiries from 1 day to several weeks. The most popular long-term options are ‘end of day’ (when the session for that asset closes) and ‘end of week’. Again, these work in the same way as high/low options, just over a longer period.

A Binary Trade Example

I’m a UK citizen who has personally traded binaries in live accounts. So I know the best way to understand how they work is to walk through an example…

Let’s say I want to trade the GBP/EUR, so I check the current market rate for that pair. Based on current trends, I believe the pound will grow stronger over the next hour, so I want to place a binary trade stating that the price will be higher after an expiry time of 1 hour.

I invest £100 and my broker offers a payout of 80%, which means that, if the rate is higher at the end of the hour, I will receive their £100 investment back plus £80 in profit. If the rate stays the same or drops after an hour, I lose my £100 to the broker.

1 hour passes by, the GBP/EUR rate is now higher and I make £80.

We can also look at an example of one-touch binary options. Say the current market price of the FTSE 100 index is 9,545. If I believe that, at some point within the next two hours, the price will rise, and the broker offers a payout of 70% for this trade.

I place a £50 one-touch trade for this to happen. Within just 30 minutes, the market price of the FTSE 100 index hits 9,546.5 and I’m paid my £50 investment along with £35 in profit.

Even if after 2 hours the value has dropped back down to 9,545, I still win the option as the price was touched within the expiry time of 2 hours.

How Do Binary Options Brokers Work?

Online brokers play an important role as they facilitate access to a variety of binary markets, from stocks and indices to cryptocurrencies.

However, these brokers do not typically charge traditional spreads or take commissions like CFD platforms. Instead, they usually take their cut from the options that traders lose, like betting companies.

For example, consider that Lloyd’s Banking Group stocks are trading at £88. The broker offers a 75% pay-out for people investing either in the value to increase or decrease in the next 30 minutes.

For simplicity, let’s say that one person thinks the value will increase, and another thinks it will decrease, both of whom invest £200. If the value of Lloyds Banking Group’s stock has decreased after 30 minutes, the brokerage gives the successful trader their £200 investment as well as £150 of profit, while they receive the entire £200 investment of the losing trader, making a profit of £50.

In essence, binary options in the UK involves betting against your online broker.

Can I Trade UK Assets With Binaries?

We’ve evaluated over 60 binary options brokers, with many providers now closed, and of those still active, they generally focus on US and global markets. That said, UK traders can still often trade binaries on currency pairs that contain the British pound and the FTSE 100 index.

Here is a comparison of the UK-focused binary assets available at top brokers:

Regulations On Binary Options In The UK

Binary options have gone from being lightly overseen betting products to a financial instrument that online brokers are no longer permitted to offer to retail traders in the UK, in line with our binary legality country checker.

Up until 3 January 2018, binaries offered to UK residents were treated as a form of gambling and overseen by the UK Gambling Commission. However, following changes to the Regulated Activities Order and the implementation of MiFID II, binary options were reclassified as financial instruments.

At this point, any UK firm offering them had to be authorised by the Financial Conduct Authority (FCA) – a ‘tier 1’ body in BinaryOptions.net’s regulator directory.

But that phase didn’t last long. After reports of consumer harm, scams and platform manipulation by some providers, the FCA followed the EU-wide temporary ban rolled out by the European Securities and Markets Authority (ESMA). This introduced short-term product intervention measures on binary options from mid-2018, effectively prohibiting the marketing or sale of binaries to retail clients across the EU.

In the UK, this was eventually made permanent. On 2 April 2019, the FCA’s rules came into force, banning the distribution of binary options to retail consumers by any firm acting in or from the UK.

For UK residents, this has two key implications:

1. No FCA-authorised broker can legally offer you binary options as a retail client. Any platform that does so is either unauthorised or operating from offshore and outside the FCA’s rules. The FCA maintains a list of unauthorised binary providers and a wider Warning List of firms to avoid (it’s worth checking this before opening an account).
2. If you choose to trade with an offshore or unregulated binary options site, you are outside the UK’s protections. This means no Financial Ombudsman Service, no FSCS compensation up to £85,000 if the firm collapses, and limited recourse avenues if the platform withholds withdrawals or manipulates payouts. Some retail investors in the UK still to choose to trade binaries, but it’s important you’re aware of the risks.

These rules only apply to retail traders. Professional traders are still able to trade binary options products.

Tip: Keep an eye on our list of binary options scams to avoid fraudulent providers.

How To Trade Binary Options In The UK

1. Choose A Broker

If you’re a professional trader or decide you’re willing to forego the regulatory protections afforded by using an FCA-authorised provider, then the first thing you need to do to is pick an overseas broker.

Carefully consider this given that the FCA has found evidence of harm, so you could lose any money you invest. There are alternative financial products, such as CFDs, which remain high risk but are more tightly regulated.

If you go ahead, key things to consider are:

• Average Payouts – Compare the average pay-outs of each broker, higher average pay-outs will mean more profit each time you win an option, though there’s no guarantee your trades will win.
• Minimum Deposit – Look for a binary broker that has a minimum deposit that suits you. Generally, a lower deposit binary broker is a safer way to get started.
• Minimum Trade – Find a broker with a low minimum trade value so that you can ease yourself into the binary options world without needing to put down massive investments from the off. Minimum stakes often start from £1 based on our tests.
• Demo Account – Many UK brokers offer a free demo account; this allows you to practice binary options trading without investing real money. Check whether you can sign up for a demo account before registering for a standard account.
• Mobile App – Some platforms offering binary options in the UK have apps available for mobile devices. If you want to trade on the move, this could be a deal-breaker. That said, most firms we’ve tested offer a mobile-optimised web platform rather than a dedicated iOS or Android application.
• Asset Range – Have a look and see which markets each broker offers, then pick one that features assets you want to trade. British traders may want access to the FTSE, for example.

2. Open An Account

The next step to trading binary options in the UK is to open an account. If your chosen broker offers a demo account, you can open this first and use it to practice and perfect your strategies.

Otherwise, when you are ready, open a live binary options trading account. I’ve opened several binary options accounts from the UK, and typically you have to provide personal details like name, email, phone number.

You’re also generally required to verify your identity before you can make a withdrawal.

3. Purchase A Binary Options Contract

Study the trends and fluctuations of the markets and assets offered by your broker. Pick a market that you like and think you can predict, and decide whether the value of that asset will rise, fall or reach a certain value.

Once you are confident, set an expiry time and open your position.

4. Await The Expiry

With binary options trading, you don’t need to closely monitor the situation or close the position manually. As you can only win or lose, simply wait for your prediction to come true (or fail) within the timeframe and realise your profit (or loss).

Tip: Some brokers have introduced features like ‘Rollover’, which lets you effectively duplicate your position if you are confident it will continue in the same direction.

Taxes On Binary Options In The UK

Historically, many UK traders treated binary options like betting, assuming profits were tax-free. However, that view is no longer reliable.

From 2018, regulatory changes (MiFID II, FCA reclassification and the subsequent ban for retail clients) blurred the line between “bet” and “financial product”.

In 2025:

• There is no blanket rule that all binary profits are tax-free.
• How your profits are treated can depend on your personal circumstances, how frequently you trade, and whether HMRC views your activity as investment, speculation or business.
• The offshore/unregulated status of your broker does not guarantee that profits are outside the UK tax net.

Because the area is messy and still evolving, you should:

• Check the latest guidance from HMRC.
• Speak to a qualified UK tax adviser before assuming your binary options profits are untaxed.

Education

There are many opportunities available to traders who want to learn more about binary options in the UK. Brokers are often keen to help traders build their confidence, so after you have registered, many will offer tools and tips to help you get started.

Video tutorials are also a handy way to learn about binary options in the UK. Websites like YouTube have a wealth of videos available to traders for free. These can help you with anything from the fundamentals to sophisticated strategy tips for more experienced traders.

Binary options trading forums are also available for UK traders. Sites such as Reddit and Discord allow like-minded investors to chat and share experiences between users. Equally, the BinaryOptions.net forum is a great place to ask questions of experienced traders.

Bottom Line

Binary options in the UK in 2025 offer an enticing but high-risk trading product. Simplicity is the key, you either win or you lose.

However, with the FCA’s ban on brokers offering retail binary options in the UK, traders must take their business to offshore and unregulated brokers, which can open them up to an increased risk of scams. Carefully review any broker before making a decision.

FAQ