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eToro to Limit Crypto Trading After SEC Settlement
Israeli trading platform eToro will restrict cryptocurrency trading for its U.S. customers following a settlement with the U.S. Securities and Exchange Commission (SEC). As part of the agreement, eToro will pay a $1.5 million penalty for operating as an unregistered broker and clearing agency.
SEC Allegations
The SEC accused eToro of allowing U.S. customers to trade crypto assets that the regulator considers securities, without complying with federal registration rules. This alleged activity dates back to 2020. While eToro did not admit or deny the charges, the settlement only impacts its U.S. operations.
Restricted Crypto Offerings
Moving forward, U.S. users of eToro will only be able to trade Bitcoin, Bitcoin Cash, and Ether. The platform will give customers 180 days to sell all other tokens.
eToro’s Response
Yoni Assia, eToro’s co-founder and CEO, stated that the settlement allows the company to focus on offering innovative products while remaining compliant with regulations. He emphasized the importance of working closely with global regulators.
SEC’s Stance on Crypto
The SEC maintains that most crypto tokens are securities and must adhere to registration rules, a position many crypto firms contest. The agency is also engaged in legal disputes with platforms like Coinbase, Binance, and Kraken, which argue that cryptocurrencies don’t meet the legal definition of securities.
Future Plans for eToro
eToro is considering an initial public offering (IPO) in either New York or London. The company previously planned to go public via a $10.4 billion merger with a blank-check firm in 2021 but canceled the deal the following year.
Footnote:
- Securities: Financial assets like stocks and bonds that represent ownership in a company or a claim on part of its income.
