eToro Settles with SEC, Delists Most Crypto Assets

eToro USA LLC has reached a settlement with the U.S. Securities and Exchange Commission (SEC), agreeing to pay a $1.5 million fine while significantly curtailing its cryptocurrency offerings. 

The SEC charged eToro with operating as an unregistered broker and clearing agency, facilitating the trading of crypto assets classified as securities without proper registration since at least 2020.

Under the terms of the settlement, eToro will limit its U.S. trading platform to only three cryptocurrencies: Bitcoin (BTC), Bitcoin Cash (BCH), and Ethereum (ETH). 

All other crypto assets will be delisted, with U.S. customers granted 180 days to sell their holdings before eToro liquidates any remaining assets and returns the proceeds to users.

This decision follows the SEC's ongoing crackdown on cryptocurrency platforms, which has seen penalties exceeding $7.4 billion since 2013. Gurbir S. Grewal, the SEC's Division of Enforcement Director, highlighted that eToro's compliance with federal securities laws enhances investor protection and sets a precedent for other crypto intermediaries.

While eToro did not admit to the SEC's allegations, the settlement reflects a broader regulatory trend impacting the cryptocurrency market. The company remains committed to its global operations, continuing to offer over 100 crypto assets outside the U.S. as it adapts to the evolving regulatory landscape.