Within the next six months, the United States arm of the financial services company, eToro, would cease trading almost all crypto assets on its platform due to a new order from the Securities and Exchange Commission (SEC).
Terms of the SEC Settlement
According to a press release from the SEC, eToro has violated federal securities laws since at least 2020. As a result, the exchange would pay a fine of $1.5 million and make a limited set of cryptocurrencies available for trading. The SEC accused eToro of operating as an unregistered broker and clearing agency and facilitating the buying and selling of crypto assets as securities on its online trading platform. In line with the settlement, eToro has agreed to cease violating federal securities laws. Henceforth, the exchange will only offer Bitcoin (BTC), Bitcoin Cash (BCH), and Ether (ETH) to its users. Following the SEC’s order, eToro’s customers have only 180 days to sell other assets that are to be eliminated from the platform, or the exchange will liquidate the cryptocurrencies and return the proceeds to users.
Previous Compliance Steps by eToro
Over the past few years, eToro has taken steps to remain compliant with the SEC’s laws. In June 2023, the exchange imposed restrictions on several crypto assets classified as securities in the agency’s lawsuits against rival trading platforms Coinbase and Binance. The assets include Algorand (ALGO), Decentraland (MANA), Dash (DASH), and Polygon (MATIC). Notably, the firm had already delisted Ripple (XRP), Cardano (ADA), and Tron (TRX) for several reasons in the months prior.
Other Regulatory Issues for eToro
Meanwhile, eToro is not just facing regulatory heat from the SEC; the Australian Securities and Investments Commission sued the platform last month for harming investors through its products.
In conclusion, the SEC settlement with eToro represents a significant step towards ensuring investor protection and regulatory compliance.
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