eToro to limit cryptocurrency trading in US after $1.5 million SEC settlement

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The SEC has reached a settlement with trading platform eToro, requiring the company to restrict crypto trading for US customers to only Bitcoin, Ethereum and Bitcoin Cash.

Under the settlement announced Thursday, eToro will pay a $1.5 million fine to settle allegations that it operated as an unregistered broker and clearing agency. The US branch of the Tel Aviv-based company will give customers 180 days to sell any crypto assets that are not included in the three allowed cryptocurrencies.

The deal significantly narrows eToro’s crypto offerings for US users, as the platform currently lists over 100 different tokens, including popular coins like XRP, Solana and Polygon. SEC Director Gurbir S. Grewal said that by removing tokens offered as investment contracts, “eToro has chosen to comply and operate within our established regulatory framework.”

eToro CEO Yoni Assia downplayed the impact, saying the deal would minimally affect the company’s business and that users outside the US can still access full cryptocurrency trading options. He expressed optimism about future crypto regulation in the US, noting: “We now have a clear regulatory framework for cryptoassets in our home markets of the UK and Europe, and we believe we will see similar in the US in the near future.”

SEC cryptocurrencies continue

The eToro settlement continues the SEC’s broader crackdown on crypto exchanges over the past year. The agency filed lawsuits against major platforms Binance, Coinbase and Kraken, while notifying Robinhood of potential enforcement action related to its crypto business. This regulatory pressure extends beyond exchanges to other crypto projects such as Tron, OpenSea and Consensys, among others.

Notably, the agreement allows eToro to continue offering Ethereum trading to US customers, despite earlier indications from the SEC that it might consider Ether an unregistered security. This aligns with the agency’s recent approval of Ether spot exchange-traded funds, signaling a shift in its stance against the second-largest cryptocurrency by market capitalization.

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