Update 01/07/2016– Lbinary Shuts Down Operation
Editor’s Note – Why does LBinary Suck in 50 Words?
In January 2014 the Cyprus Securities and Exchange Commission (CySEC) warned investors about the fact that LBinary is not authorized or regulated by them and therefore is not permitted to provide investment and ancillary services. In other words, we are dealing with a brokerage which is not allowed to be a brokerage… well, that sucks. Update August 2015: they are still not regulated and still not showing their intention to become regulated.
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Why LBinary doesn’t Suck?
LBinary made a step forward regarding social trading by introducing “iFollow”. This feature allows you – as you might have guessed – to follow top traders and copy their trades on your account. At the moment no automated copy trading feature is implemented but you can view a list of successful traders filtered by the asset they trade. Update August 2015: the follow feature remains mostly unused by clients and did not manage to create the impact it aimed for.
Lbinary Review – Don’t Dig Deeper If You Don’t Want The Truth.
Lbinary.com was owned by Live Binary Ltd. when they have received their first warning and a few months later (when the second warning came out), the owning company was Chelestra Ltd. According to some sources, this company is located in Gibraltar, at 5 Secretary’s Lane, but we cannot verify if this is the right address and if you’ll find Lbinary representatives there. Lbnary is not a transparent broker as you can easily see and we strongly urge you to use caution if dealing with this type of brokers. Similar to most binary options brokers these days, LBinary is located in Cyprus but is not regulated by the CySEC and even more, the mentioned authority warned investors not to do business with this brokerage. We strongly recommend reading the two warnings issued by the Cyprus Securities and Exchange Commission before investing (link here and here).
At first glance, the website appears simple and clean, without annoying pop-ups or super flashy marketing, a thing we appreciate but don’t consider a major pro. The company is relatively new on the binary options scene and uses the ever popular SpotOption (they have recently upgraded to the 2.0 version of the platform) platform which is known for its reliability and ease of use.
The educational material offered by LBinary is limited and very similar to other binary options brokers, covering just the tip of the iceberg when it comes to trading as a business. However, it is not bad and it’s a good way of “getting your feet wet” but it will not make you a true professional. Video lessons and a free e-book are available as well. Their Market Review contains up to date information and we commend them for that because the majority of brokers “forget” to update their daily commentary so we are forced to consider something normal as a positive feature. If you don’t want to make use of their educational material or daily market review, you can follow other supposedly successful traders with their “iFollow” social platform which allows you to see the top traders for a particular asset and follow their actions. Although it seems like a nice feature, surprisingly almost nobody uses it. The followers of a trader are displayed on the platform but the number “zero” kept appearing while browsing through the most commonly traded assets. So either people don’t like the iFollow social platform or technical reasons prevent the number of followers from displaying correctly. Update August 2015: the number “zero” no longer appears in the followers column but people don’t talk about this feature at all on the internet. If it were such a profitable tool, I am sure we would have heard more about it.
LBinary offers 5 account types with deposits ranging from $250 for the Micro account and $10K for the VIP account. Well, if you are a serious trader who wants to invest 10 thousand bucks, I believe there are better broker choices than a company that is not permitted by CySEC to provide investment and ancillary services. In fact, I believe that any investor, no matter how small should think twice before investing with such brokers. Update August 2015: the deposit amounts corresponding to each type of account are no longer displayed on the website. You will probably have to contact their support.
Is LBinary a Scam?
To avoid being scammed, we strongly recommend reading in full their Terms and Conditions document because we noticed some major discrepancies between the information available on the website and the one in the mentioned document. Here are just a few examples:
On main website: “Investors’ funds are held in a segregated account. Funds are used only for trading options through our website upon client’s instructions and not being used for any other cause.”
Within T&C: “Whenever the Client transfers funds to the Company, those funds belong to the Company…”
“The Client will not have a proprietary claim over money transferred to the Company, and the Company can deal with it in its own right…”
“Thus, in the event the Company has suffered losses unrelated to the performance of the Client’s Account, the Company may be unable to satisfy redemption requests or request for distribution of cash or securities. The Company is Not Covered by Insurance in Case of Misconduct by Our Agents or in case of Insolvency.”
These are just fragments and are open to interpretation. For full text, visit their website and keep in mind that the T&C document can change at any time, without notice, so even if we update the information provided here today, it can change tomorrow. They also have a weird “dormant account” policy: fees and commissions “determined by the Company” may be deducted from the trader’s account. In other words, we don’t know how much they will deduct but we agree to it by accepting the T&C. Ok, that’s cr4p and it stinks: we have a company which is not even authorized (regulation is a distant dream) and which makes us agree that our money is theirs once we deposit, and they can take as much money as they want from our account as a Dormant Trading commission. I only have one more thing to say: if you deposit after reading this review and their T&C, don’t cry for your money.
Update August 2015: Clients all over the Internet are complaining about the poor service offered by Lbinary. People cannot withdraw as they should, weird account activity is present and Lbinary is almost always featured in our monthly Scam Watch. Please be careful if dealing with this brokerage/website.
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Well, I would say that CySEC recently complained about their activity, don’t you agree it’s a bit of problem? There are many complaints, a simple scroll to the bottom of this page would revile a world of complaints. Also check our user-reviews section. I recommend a simple Google search to uncover many complaints, simply write: Lbinary Scam/fraud/complaints/suck and search deeper into forums and comments sections. Do NOT believe every review you see, but beware, the truth is right there.
Their bonus can go as high as 100% in some cases, depending on their current promotion but we don’t recommend accepting such a bonus under any circumstances because your money will be tied to the platform due to withdrawal restrictions. The required turnover before withdrawing is 25 times the bonus + deposit.
Minimum withdrawal for wire transfers is $500 which is extremely high considering the fact that minimum deposit is $250. However, minimum withdrawal amount for Credit/Debit cards is $100; all withdrawals will be made to the same account which was used to deposit.
We consider the “iFollow” social trading feature a pretty good addition but unfortunately it doesn’t seem to work how it was supposed to because there are zero followers on almost all assets.
User Friendly 15/20
The website has some broken links in the FAQ section but other than that there are no major functionality issues. The platform itself is easy to use and offers all the commonly known features. The website is translated in 6 languages.
Number of assets and expiry times 16/20
The asset Index is composed of 18 stocks, 28 currency pairs (+Bitcoin), 7 commodities and 26 indices so I guess users will find enough trading opportunities. The popular 60 seconds trading is available and other expiry times range from 15 minutes, hourly and can go up to end of year expiry. An Option Builder is available for creating your custom options.
Commissions, Support and Effective return 10/20
The Dormant Trading commission is weird to say the least because it allows LBinary to charge the client any sum, under almost any circumstances. It is not clear what a Dormant account really is and this can be determined only by LBinary… at their sole discretion. Support is as helpful as it gets in this business. My questions have been answered with other questions but in the end I managed to obtain the desired info. Effective return goes up to 85% and the refund is 10%. Note that these percentages do not apply to all assets.
Deposit, Payment and Bonus 13/20
Minimum initial deposit is $250 and can be made through Credit/Debit Card or wire transfer. Withdrawals are available through the same methods but for wire transfers, the minimum withdrawal is $500 (only $100 for CC). Bonuses can go as high as 100% depending on ongoing promotions and the turnover required before withdrawals can be made is bonus + deposit x 25.
Website Extras 12/20
Their “iFollow” feature has great potential but at the time this review was written almost nobody was using it. We don’t know if this is because a technical malfunction or simply because traders don’t find it appealing enough. Either way, it doesn’t work as it is supposed to.
LBinary Overall Ratings: 66/100
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