Popular online trading and investing platform eToro USA has agreed to settle charges with the Securities and Exchange Commission (SEC) and will significantly curtail its crypto asset offerings, it was revealed on Thursday.
eToro USA to Cease Trading in Nearly All Crypto Assets
The SEC alleged that eToro operated as an unregistered broker and clearing agency by facilitating the buying and selling of certain crypto assets that were deemed securities.
In response, eToro has agreed to pay a $1.5 million penalty, while it has also agreed to “cease and desist from violating the applicable federal securities laws and will make only a limited set of crypto assets available for trading.”
The SEC said that since at least 2020, eToro worked as a broker and clearing agency by providing US customers the ability, through its online platform, to trade crypto assets being offered and sold as securities. However, they add that eToro did not comply with the registration provisions of the federal securities laws.
Going forward, eToro said US customers will only be able to trade Bitcoin, Bitcoin Cash, and Ether on eToro’s platform.
The company will also provide a 180-day window for customers to sell their holdings of other crypto assets.
Gurbir Grewal, Director of the SEC’s Division of Enforcement, stated: “By removing tokens offered as investment contracts from its platform, eToro has chosen to come into compliance and operate within our established regulatory framework. This resolution not only enhances investor protection, but also offers a pathway for other crypto intermediaries.”
Without admitting or denying the SEC’s findings, eToro agreed to the settlement terms, including the payment of the penalty and the liquidation of any remaining crypto assets that cannot be transferred to customers.
