eToro settles SEC claims and will cancel trading in most cryptocurrencies
eToro settles SEC claims and will cancel trading in most cryptocurrencies
eToro, a global social trading platform, has reached a $15 million settlement with the U.S. Securities and Exchange Commission (SEC) over allegations that it violated U.S. securities laws. As part of the settlement, eToro has agreed to stop offering certain cryptocurrency trading services to U.S. customers. The settlement highlights the growing regulatory scrutiny over cryptocurrency platforms operating in the U.S.
The SEC’s action centered on eToro’s trading platform, which allows retail investors to trade cryptocurrencies alongside traditional assets. According to the SEC, eToro failed to register its platform as a national securities exchange, a requirement for platforms that offer trading in securities. The agency argued that some of the digital assets offered by eToro qualified as securities under U.S. law, placing the platform in violation of securities regulations.
As part of the agreement with the SEC, eToro will pay a $15 million penalty and has agreed to implement measures to ensure compliance with U.S. regulations moving forward. The settlement also requires eToro to cease trading a significant portion of the cryptocurrencies available on its platform for U.S. customers. The company will continue to offer trading in major cryptocurrencies like Bitcoin and Ethereum but will no longer support trading in assets that the SEC considers securities.
eToro has issued a press release announcing that it has reached a settlement agreement with the SEC. “This agreement allows us to move forward and focus on providing innovative and relevant products across our diversified U.S. business. U.S. users can continue to trade and invest in stocks, ETFs, options and the three largest crypto assets. It is important for us to be compliant and work closely with regulators around the world. We have a clear regulatory framework for crypto assets in the UK and European markets and we believe we will see a similar framework in the US in the near future. Once this is in place, we will endeavor to allow trading in cryptoassets that comply with this framework,” commented eToro CEO Yoni Assia.
eToro’s decision to settle rather than contest the SEC’s charges demonstrates the platform’s willingness to cooperate with regulators and adapt to the changing legal landscape. In a statement, eToro said it remains committed to serving its U.S. customers while working with regulators to ensure that its offerings comply with the law. The company also emphasized that it plans to enhance transparency and compliance measures to prevent similar issues in the future.
eToro is not the first major crypto trading platform to face such regulatory challenges. Several high-profile exchanges and crypto firms have faced similar charges as U.S. regulators work to establish clear guidelines for the rapidly growing digital asset industry. The outcome of these cases is likely to shape the future of crypto regulation in the U.S., with potential implications for how platforms like eToro operate globally.
For eToro, the settlement provides a path forward as it seeks to maintain its presence in the U.S. market. While the platform will scale back its cryptocurrency offerings, it will continue to offer services related to traditional assets, including stocks and exchange-traded funds (ETFs), as well as trading in major cryptocurrencies like Bitcoin.
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