Offering no fewer than 5 tradable cryptocurrency assets, 24option is an online Forex/CFD brokerage that presents some interest for crypto enthusiasts.
BTC, ETH, XRP, Dash and LTC can be traded with the broker, through CFDs (Contracts for Differences).
As one of the oldest (and perhaps most infamous) actors of the online trading scene, 24option is not an easy nut to crack.
This detailed review of the brokerage sums up everything a would-be crypto trader has to know about it.
We have also included a guide for cryptocurrency traders who want to give 24option’s crypto CFDs a try. CFD-based crypto trading can indeed be a risky and tricky activity. Still largely unregulated, it presents a series of special challenges traders have to fully understand before they commit any real money to this venture.
What is 24option?
24option is a regulated Forex/CFD broker. It is based in Cyprus and licensed by the local financial authorities. 24option offers online trading services to citizens of the country as well as to those of the EEA (European Economic Area), with some exceptions.
Though it is currently MiFID II-compliant, 24option made its start in the dubious business of binary options (hence its name). That also explains its downright abysmal reputation among traders – at least to some extent.
As mentioned, 24options’ reputation is a hard pill to swallow for everyone looking to trade there.
A quick glance over the community forums/message boards will convince would-be traders that this is indeed a scam operation. That, however, is simply not true nowadays.
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Complaints cover just about every operational aspect of the broker. Traders dislike its customer support and fulminate against its alleged refusals to honor client withdrawals.
Binary options were predatory by nature and 24option was originally built on this investment vehicle. BOs are now more or less defunct due to regulatory pressure.
It is safe to assume that at the very least, a large percentage of unfavorable user reviews date back to that era.
Above and beyond the subjective opinions expressed by retail traders, there is some objectively recorded history available on 24option’s past antics as well.
As a trader interested in opening an account with the broker, you should be aware of this history.
Back in 2013, the operation made the warning list of the Ontario Securities Commission. The entry identified a number of other websites and online brokerages operated by Rodeler Ltd – the company behind 24option.
In June 2015, 24option acquired optionsxo.com, another broker that was blacklisted by online watchdogs shortly thereafter.
In August 2016, French financial regulatory agency AMF (Autorite des Marches Financiers) squarely banned Rodeler Limited and specifically its 24option brand, from doing business in the country.
Even since then, the operation has accrued an alarming number of “guilty” verdicts from various online reviewers and community portals.
You have to be aware that despite its regulated nature and MiFID II compliance, 24option may still be looking to sweep some conflict-of-interest issues under the rug.
According to its Conflict of Interest policy, the client has to authorize the company to deal with him/her in any way the company sees fit, “notwithstanding any conflict of interest”.
Who are 24option?
The corporate entity in control of the 24option brand is a certain Rodeler Ltd, based in Cyprus.
The exact address of the company is 39 Kolonakiou street, Frema Plaza, Agios Athanasios, 4103 Limassol, Cyprus.
CySEC is the regulatory agency in charge of keeping the operation on the path of MiFID II compliance.
The broker possesses CySEC license #207/13, obviously issued in 2013.
This license is not just testimony to the broker’s MiFID compliance, it gives retail investors protection under the ICF (Investor Compensation Fund) as required by the same legal framework.
It also gives Rodeler Ltd and its 24option brand, the right to legally peddle their financial services all over the European Economic Area. Switzerland (not an EU member) is also part of this fold.
Belgium and France, which have expressly banned the broker, are excluded of course.
To make its services available for the rest of the world, the operator has set up shop in Belize.
Richfield Capital Limited is a corporate entity belonging to the same group of companies as Rodeler Ltd. In Belize, it is the owner of the 24option brand.
To be able to legally service clients from various global locations, Richfield Capital needs to operate under a regulatory umbrella. In this instance, the umbrella is provided by the International Financial Services Commission of Belize.
The IFSC license number of the operation is IFSC/60/440/TS/18.
Despite the reputation-related issues detailed above, it is clear that the regulatory standing of the broker is a solid one.
As a crypto-focused trader, you need to be aware of the fact that the crypto CFD section is not the main focus of the broker. Its market coverage is centered on forex pairs, indexes, and various commodities. Apparently, marijuana stocks have also been added to the asset selection recently.
Things to Consider
- Of the regulatory umbrellas discussed above, none extend to the US. Therefore, 24option cannot accept traders from the US. Given the business model of the brokerage as well as its past, it is not likely to gain US regulatory approval in the future.
- With 24option, you can only trade cryptocurrencies through financial derivatives called CFDs (Contracts for Differences). What this means is that traders will only bet on the price-evolution of the underlying asset (which can be BTC, ETH, Dash, LTC or XRP), without ever gaining possession of the said asset.
- 24option’s reputation is not stellar, to say the least. Be aware of that before you make your first real money deposit.
- CFDs are leveraged trading instruments. Though in the case of 24option’s crypto CFDs, the leverage is capped at 1:5, it still brings significant added risk into the equation.
- According to its Best Execution Policy, 24option may act as a market maker in some cases. What this means is that the broker will calculate and provide its own tradable prices. It derives these prices from data provided by price feeders. In effect, this also means that as a market-maker, the broker will trade against its own clients. This is where the above discussed fundamental conflict of interest (well covered in the broker’s Conflict of Interest policy) comes in.
Long story short: you will end up trading against the broker.
- In theory, regulatory compliance guarantees the safety of funds deposited by traders. The broker keeps such funds in segregated accounts with high profile banks. Still, it bears repeating that there have been complaints and allegations concerning the mishandling of trader monies.
- As a 24option trader, you will pay for the services the broker provides, through commissions and spreads.
- Despite the popularity of cryptocurrencies, the broker considers the crypto CFD class a high-risk one. The trading conditions reflect the volatility of the asset class. Spreads are wider on cryptos so you will pay more to trade these instruments.
- Between the broker’s STP execution and market making activities, slippage and requotes may indeed occur. Such issues come hand-in-hand with volatility, and cryptos are highly volatile…
- The attractive spreads and trading conditions the broker’s site advertises are always valid for the most popular forex pairs, such as the EUR/USD. Cryptos are much less attractive in this regard.
Trading Cryptos Through CFDs
CFDs do not grant traders any sort of ownership over the traded underlying asset, or any other rights for that matter. Such derivatives only provide exposure to the fluctuations of the asset price.
That said, they do offer certain advantages. Some traders are not keen on owning any cryptos. They merely see a chance to profit off their volatility. For such traders, CFDs are the ideal investment vehicles.
Moreover, through CFDs, speculators can profit off falling markets too.
The minimum deposit required by 24option is just EUR250. That’s a very attractive entry-price for any crypto investor.
The bottom line is that CFDs are speculation-focused vehicles. If you are a true crypto believer, they’re probably not right for you.
How to Open a 24option Account?
- Trade Bitcoin, Ethereum, Ripple, Dash & Litecoin.
- Max crypto leverage for retail clients is 1:2.
- Buy and sell other markets like forex & trade companies like Facebook, Netflix & Apple.
- Trade anywhere with the 24option iOS & Android App.
- Deposit methods: Visa, Visa Electron, Mastercard, Skrill, Neteller & more.
Buy & Sell Crypto & Other World Markets With 24Option
Before you hit that Sign-Up button, you need to get a couple of things out of the way.
The first of these is the trading platform you wish to use. Fortunately, 24option only offers two choices in this regard. They have a proprietary Web Trader, and they support MetaQuotes’ MT4. MT4 is the world most popular and arguably the most capable trading platform.
The Web Trader is a very interesting piece of browser-based trading software. It offers great compatibility and its features are nothing short of spectacular.
Simplistic at first glance, the Web Trader unfolds into a full technical analysis lab, complete with scores of indicators, drawing tools and time frames.
Its charting abilities are superb. Several chart types are supported. There is an amazing indicator wizard, which makes the adding of just about any technical indicator extremely simple.
For a browser-based solution, 24option’s Web Trader is a very impressive platform indeed.
MT4 needs no introduction to trading veterans. You can download it from the broker’s website for free.
More than 85 technical indicators come with the downloaded version and still more can be installed.
Charting-wise, MT4 is indeed unparalleled. Supporting an impressive number of time frames as well as chart- and order types, it is the perfect environment for technical analysis.
Those who want to capitalize on the advantages of CFD-based crypto trading will indeed have to make use of all these capabilities.
Automated trading is without a doubt the most popular feature of MT4. Traders are free to buy and install their own expert advisors. Those skilled enough can even code such EAs from scratch.
When coupled with properly set custom scripts, EAs can be very efficient. What’s more, they don’t even require traders to keep their computers running around the clock. They can be run off a VPS, which most proper brokers do have covered.
The second thing you need to settle before signing up for a real money 24option account is your account type.
Before we get to that, you should also know that the maximum leverage for retail traders is set to 1:30. Only institutional clients get leverage of up to 1:400.
The Basic Account is the most accessible one. The minimum required deposit on this one is EUR 250. The problem is, however, that the spreads on this account type are rather wide.
On the EUR/USD for instance, the smallest spread is 2.3 pips.
Basic traders only get to make a single free withdrawal.
The Gold Account requires a deposit of EUR5,000. For that money, it offers better spreads though. The minimum on the EUR/USD is 1.8 pips.
Gold traders can request a free withdrawal once every month.
To get a Platinum Account going, traders need to deposit at least EUR 10,000. The smallest spread on the EUR/USD pair for this account is 1.4 pips.
To further reduce the spread, you may choose to go for a VIP Account. To make that happen, you need to pony up at least EUR 50,000 though.
The minimum spread on the VIP Account, on the EUR/USD pair, is 0.9 pips. Trading lessons, webinars and Trading Central SMS alerts are also included in the VIP package.
To register a real money account, all you need to do is to hit the Sign Up button in the top right corner of the official homepage.
You can first register for a Demo Account, but you can choose to “Switch to Real” at any point in time.
When you do, you’ll be required to fill in a rather impressive number of forms, providing information on your:
- Employment status
- Work vertical
- Education level
- Field of study
- Political exposure
- Revenue sources
- Net Wealth
- Projected deposit amount
- Reason for joining
- Trading experience
- Annual frequency of trading
- Trading expertise (there’s a small Q&A style test)
After that, you can choose your deposit method and proceed to making your first deposit with the broker.
Before you can begin trading, you also need to provide a few documents through the broker’s Verification Center.
These documents may be IDs, Credit Cards, proof or residence documents, or even passports.
How to Buy and Sell through 24option?
Having made your first deposit with the broker, you’re ready to place your first trade. As said, you can Buy and Sell crypto CFDs, depending on whether you think the price of the underlying asset will head Up or Down.
You can use the Web Trader or MT4. If you opt for the Web Trader, you’ll be ready to hit the Buy/Sell button in seconds.
Every one of the 5 supported cryptocurrencies is available through the browser-based platform, paired with the USD and the EUR.
After you visualize the chart and perform your technical analysis, just click the Show Graph button. You’ll find yourself in the one-click trading section, where you can set your trading volume as well as the rate where you want your trade triggered.
Click Buy/Sell and then Trade.
You can manage your position by clicking on it under the Open Trades tab. You can set SLs and TPs and you can close your trade there too.
If you opt for MT4, you’ll likely only be able to trade the BTC/USD pair (at least that’s the only one we found there).
Just navigate to the pair of your choice (BTC/USD), bring up the chart and apply all the technical indicators of your choice to it.
When you decide to make your move, just right-click the chart and hit One-Click Trading. Set your trading volume and hit Buy or Sell.
You can also create an order through the New Order button in the toolbar. This way, you can choose between market execution (having your order executed at the market price) and placing a pending order. With a pending order, you’ll set your own price, at which you want your order executed.
Your orders can be viewed and managed below the chart section, under the Trade tab.
24option Customer Support
You can contact the broker’s support staff via live chat, available at the official website. There is a support email as well: [email protected]
An email form is available on the Contact Us page.
24option maintains three client service offices: in Germany, Cyprus, and Romania.
The regulatory requirements to which the broker has adhered guarantee the security of the funds deposited by traders with 24option.
Trader monies are kept in segregated bank accounts. The Broker’s ICF membership provides an additional safety net.
- Solid trading platforms
- Decent selection of crypto CFDs
- Well regulated, MiFID II-compliant
- Low initial deposit requirement
- Low leverage cap on crypto CFDs
- Access forex and commodities trading
- Murky reputation
- Inherent risks associated with leveraged CFDs
- Not really crypto-focused
- Somewhat adverse trading conditions (especially on cryptos)
- Does not accept traders from the US
- Market maker