eToro limits US crypto trading to 3 coins after SEC $1.5M fine

eToro USA has reached a settlement with the U.S. Securities and Exchange Commission (SEC) to pay a $1.5 million fine over charges of operating as an unregistered broker and clearing agency for crypto trading. 

As part of this agreement, eToro will restrict trading options for its U.S. customers to only three cryptocurrencies: Bitcoin (CRYPTO:BTC), Bitcoin Cash (CRYPTO:BCH), and Ether (CRYPTO:ETH). 

The company has provided a 180-day window for users to sell any other crypto assets. 

As stated by the SEC, eToro agreed to "cease and desist from violating the applicable federal securities laws" and to limit the availability of crypto assets on its platform for U.S. customers. 

Following the SEC's order, Bitcoin, Bitcoin Cash, and Ether will be the only cryptocurrencies available for trading on eToro’s U.S. platform. 

In addition to limiting trading options, eToro will provide functionality for customers to sell all other crypto assets within 180 days of the SEC order. 

If any crypto assets deemed securities cannot be transferred back to customers within this period, eToro will liquidate them within 187 days and return the proceeds to the respective customers. 

Gurbir S. 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.” 

The agreement comes without eToro admitting or denying the SEC's findings. 

The company's decision to limit the number of cryptocurrencies available for trading is seen as a move to comply with the SEC's regulations while maintaining its presence in the U.S. market.