BuyIQD.Com Blog

Beware of Iraqi Dinar Options April 19 2017

EDIT: Since the posting of this origional article the SEC has cracked down on eBay sellers and Iraqi Dinar dealers selling options. We as a company have never sold options, not only have we always felt it's not a good purchase for the buyer, but we always knew it was a legal grey area to do so. While since one dealer was fined and issued a cease and desist by the SEC, almost immediately after all other dealers selling Iraqi Dinar options pulled their listings of it down. Here is the press release regarding this...

 

http://www.cftc.gov/idc/groups/public/@lrenforcementactions/documents/legalpleading/enfdinarcomplaint072715.pdf

 

ORIGIONAL ARTICLE BELOW

 

In this buyers guide we are going to discuss the pitfalls of Iraqi Dinar options as well as why  you need to be VERY careful who you buy from. In this buyers guide we will discuss what is an Iraqi Dinar Options? Are Iraqi Dinar Options allowed on eBay per ebay TOS and by law? Why you need to be careful who you buy options from? As well as are options a good thing to buy in the first place?

What Is An Iraqi Dinar Option?

Options with the Iraqi Dinar aren't much different than options in the stock market. You are buying the "option" or opporunity to buy a product or commodity, in this case the Iraqi Dinar, at a predetermined price by a predetermined date. For this example we'll say this is a 30 day option to buy 10 million Iraqi Dinar. 

An ebay seller may be selling a 30 day option to buy 10 million Iraqi Dinar. The terms would be from the date you make payment via Paypal, you have 30 days to choose to buy 10 million Iraqi Dinar at a price of $1100 per million.  The option for example may cost something like $150 which is much cheaper than the $10,000 it would cost to buy outright.

The logic behind this from a buyers perspective being that the Iraqi Dinar will go up in value in the next 30 days or possibly even revalue as many buyers call it. If that were to happen and a million Dinar were not worth $5,000 the buyer would be able to buy that 10 million Dinar at $1100 per million which is substantially cheaper than the new price of $5,000. It should be noted that a million Dinar on eBay can currently be purchased for under $1,000 so the option price is inflated to $1100 because it's giving you the conveninece of buying it at a later time. 

Are Iraqi Dinar Options Allowed By Ebay & By Law?

It would be interesting to get a definitive answer if options are allowed to be sold on eBay. eBay has a button to report products and one of those options is reporting a "stock and other securities". An option by definition is both a stock and a security. An option is also an intangible good which is often something not allowed to be sold on eBay.

In terms of law, this is also interesting. To sell investments an investment as well as the person selling it has to be registered with the SEC. An option by definition is an invesetment and a security however to date no Iraqi Dinar dealer or options seller has registered with the SEC to sell investments. 

To date eBay, nor the SEC has taken any action against those selling Iraqi DInar options, but selling options definately seems to be a grey area both among eBay policy as well as with the SEC

Be Careful Who You Buy Options From...

An Iraqi Dinar option is in many ways the perfect product to sell. People have been buying the Iraqi Dinar for years and it hasn't seen any significant increases in value. Because of this very few if any option buyers ever excercise their option to buy. Why? Because why pay $1100 to excercise an option whenthey can buy a million Dinar outrite for under $1,000. 

Because of this some unscrupulous sellers are selling options knowing they can pocket hundreds of dollars per buyer without ever having to deliver a physical product. These unscrupulous sellers also do not even have the Dinar in stock to back the options they are selling. Because nothing has ever happenned these sellers are in the clear. THe danger would be if we woke up tomorrow and the Iraqi Dinar was worth $10,000 per million. That would mean the buyers would see a profit 10x what they spent. The sellers on the other hand would have to deliver Dinar to all those options buyers who wanted to buy, which would probably be every last one of them. If the seller didn't physically have the Dinar this would mean they either can't deliver the Dinar they sold options on, or they have to go out to the market and pay 10x the price of the DInar they should have been holding in the first place. Not very likely they can do that which means many buyers would be getting screwed over royally.

Many Iraqi Dinar options sellers have popped up selling options. Few of these sellers have much ebay history nor do they have any history of selling Iraqi DInar, yet one day out of the blue they have hundreds of millions of Iraqi Dinar options for sale. Now legally they should have hundreds of millions of Dinar sitting in a vault somewhere to deliver these options. My fear is that they don't. Should the DInar go up in value and the seller can't deliver the options I imagine many people would be complaining to ebay and Paypal. Ebay and Paypal can't really force this seller to deliver something which basically means the buyers would probably be refunded their option money, but would not get the actual Iraqi Dinar which is now in this hypothetical situation worth 10x what it was when they bought the option. 

If you are buying options please be sure to ask if the seller is Treasury Registered. They are illegally selling Iraqi Dinar and Iraqi Dinar options if they are not Treasury Registered. Secondly, ask if they have the physical Dinar to back all the options they are selling. If they say yes ask if they've had an independent audit done to show this. If they are not Treasury Registered and if they have not had an independent audit done to prove they can back their options you shoudln't buy from them.

Should You Be Buying Iraqi Dinar Options In The First Place?

This is another totally different question but it's something you should think about. Buying options versus buying physical Iraqi Dinar. People have been buying Iraqi Dinar for the past 9 years or so. People have also been buying options this long. Now when you purchase an option you don't actually get physical Dinar. Let's just say for example 9 years ago one guy stareted buying options and another guy started buying physical dinar. They paid essentially teh same money. Guy A bought a 100,000 Dinar every month for this time. Guy B bought an option for 10 million Dinar each month. They have both spend roughly $10,800. Guy A now has 10,800,000 Iraqi Dinar in physical currency which he can choose to hang on to, or sell at only a small loss. Guy B also spent $10,800 yet he has no physical DInar and nothing to show for his money because he wasn't able to time the market so to speak. 

Hope this buyers guide taught you more about Iraqi Dinar options. Before buying Iraqi Dinar options first make sure you want to buy options over the physical currency. If you decide to buy options fully vet who you're buying from. Make sure they are both Treasury Registered, Registered with the SEC to sell investments, and that they've had an audit done by a third party company to insure they can back the options they are selling and actually have the physical DInar to cover every option they sell.