The trading platform eToro has reached a settlement with the U.S. Securities and Exchange Commission (SEC), significantly reducing its crypto offerings for U.S. customers.
Terms of the Agreement
As part of the agreement, eToro will only offer trading in three cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), and Bitcoin Cash (BCH). This decision comes after the SEC accused eToro of operating as an unregistered broker and clearing agency, facilitating the trading of crypto assets that the SEC considers securities. eToro has also agreed to pay a $1.5 million penalty, signaling its commitment to resolving the SEC’s claims without admitting or denying the allegations.
Deadline for U.S. Users
Under the terms of the SEC settlement, eToro will offboard all crypto assets except BTC, ETH, and BCH within the next 187 days. U.S. users will have 180 days to sell or liquidate their holdings in other cryptocurrencies before their access to these assets is restricted. Any remaining assets after this window will be liquidated, and users will receive proceeds equivalent to their account balances.
SEC's Position on Cryptocurrencies
The SEC's actions against eToro are part of a larger campaign to regulate the crypto space. The settlement suggests the SEC sees most cryptocurrencies beyond Bitcoin, Ethereum, and Bitcoin Cash as securities. In 2020, following the SEC's lawsuit against Ripple, eToro delisted XRP and three other cryptocurrencies. eToro’s settlement with the SEC may prompt other crypto platforms to rethink their U.S. operations. Major players like Coinbase, Binance, and Kraken are already entangled in legal battles with the SEC, contesting the regulator’s stance that most cryptocurrencies are securities.
eToro's decision to limit the number of crypto assets it offers in the U.S. is part of its effort to comply with regulatory requirements, which may impact other platforms operating in the crypto space.
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