Definition ∞ Binary options are a type of financial derivative where the payoff is either a fixed amount or nothing at all, based on whether the underlying asset’s price meets a specific condition at expiration. The outcome is strictly binary, resulting in a win or a loss for the trader. These instruments are known for their all-or-nothing nature.
Context ∞ The discussion surrounding binary options in the crypto space often involves regulatory scrutiny due to their speculative nature and potential for high risk. While some platforms offer them as a trading instrument, concerns persist regarding investor protection and market manipulation. The prevalence of binary options trading can indicate specific market behaviors and the appetite for high-risk, short-term trading strategies.