The shoes continue to drop in the Israel binary options sector.
After our earlier exclusive report that rival Anyoption was ceasing all binary options activity – after previously moving all call center and client facing operations out of the country – LeapRate has learned from sources close to the company that TechFinancials Inc (LON:TECH) is significantly downsizing its Herzliya, Israel offices (pictured above), letting go of many Israel based employees as it moves positions out of the country.
TechFinancials is somewhat of a different organization that other binary options industry participants, in that the company acts as both a platform provider to third party brokers, and also operates its own OptionFair brand. TechFinancials is also the 51% owner of an Asia binary options brand, DragonFinancials. The company’s revenue is divided roughly equally between the ‘B2B’ platform and ‘B2C’ brokerage businesses.
TechFinancials’ decision comes as Israel’s new binary options law is making its way through the Knesset (Israel’s parliament). Once the law passes and becomes enacted, expected in early Fall, both the operation of a binary options brokerage as well as the provision of technology and services to binary options brokers out of Israel will become illegal and punishable by both jail time and fines.
Most of OptionFair’s operations have been relocated to Cyprus over the past couple of years, even ahead of the new legislation, where the company’s parent B.O. Tradefinancials Ltd is licensed by CySEC. However most of the platform business, as well as certain services provided to both OptionFair and the DragonFinancials JV, has been operated until now out of Israel. Under the new law (assuming it passes, which it should), that will no longer be allowed.
As such, many of the technology and R&D positions in the company have been relocated to TechFinancials’ Kiev, Ukraine office.