Crypto: eToro cede ante la SEC y limita su oferta en Estados Unidos

The U.S. SEC has never acted as the financial sheriff in the Wild West of cripto as much as it does now. Constantly reminding, it lets nothing go unnoticed. The latest victim? eToro, accused of acting as a broker without a license, must drastically reduce its crypto offerings for American clients. A look back at a hefty fine and the changes imposed on the platform.

The SEC strikes hard and eToro complies

Since 2020, the SEC, which is currently conducting an investigation on OpenSea, has been closely monitoring eToro and its crypto trading practices in the United States. The verdict? The hammer falls: eToro was operating illegally as a broker and clearing agency without the slightest license. A real cowboy of crypto trading, one might say!

The SEC’s argument: certain crypto assets offered by eToro are considered securities, and thus subject to current regulations.

eToro, caught red-handed, had no choice but to comply with the authority of the financial market sheriff. The result? The platform agrees to pay a fine of 1.5 million dollars and commits to drastically reducing the crypto offerings available to U.S. traders.

• Since 2020, eToro has allowed the trading of crypto assets without respecting the law;
• A fine of 1.5 million for violating securities laws;
• Only three cryptos will remain available for U.S. customers: Bitcoin, Bitcoin Cash, and Ethereum.

With this decision, the SEC sends a strong message to other platforms: comply with the law or face the consequences.

As Gurbir S. Grewal, Director of the SEC’s Enforcement Division, said:

“This resolution offers a path for other crypto intermediaries to comply with the established regulatory framework”

The big cleanup in eToro’s crypto offering

The SEC’s decision has direct repercussions on eToro’s crypto offerings. Goodbye to the multiple altcoins once available to American clients. In the future, only Bitcoin (BTC), Bitcoin Cash (BCH), and Ethereum (ETH) will be offered. A limited choice that may drive away some users accustomed to diversity. But what can be done in the face of the SEC?

The platform allows its users to sell their other cryptos within 180 days. After this period, these assets will be liquidated and the gains returned to the users. This spring cleaning in the middle of autumn clearly illustrates the SEC’s strategy: to clean up the crypto trading markets and put things in order.

eToro will now have to deal with a much more limited offering in the United States. A hard blow for the platform, which built part of its success on its diversity of assets.

The consequences for the American crypto market remain to be seen, but it is certain that regulation continues to tighten, leaving little room for the reckless. In this atmosphere of fraud hunting, eToro is under close surveillance. With 4.68 billion dollars in fines in 2024, the SEC plays the role of a hungry wolf and crypto platforms must stay on their guard.