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Etoro USA has agreed to pay $1.5 million to the U.S. Securities and Exchange Commission (SEC) to settle charges of operating as an unregistered broker and clearing agency for crypto trading. Etoro will limit U.S. customers’ trading options to bitcoin, bitcoin cash, and ether, with a 180-day window to sell other crypto assets. If certain crypto assets cannot be transferred back to customers, Etoro will liquidate them within 187 days and return proceeds.
Etoro to Pay $1.5M for SEC Violation Over Unregistered Crypto Trading
The U.S. Securities and Exchange Commission (SEC) announced Thursday that Etoro USA LLC has agreed to pay $1.5 million “to settle charges that it operated an unregistered broker and unregistered clearing agency in connection with its trading platform that facilitated buying and selling certain crypto assets as securities.”
The SEC detailed: “Etoro has 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 securities regulator explained:
Etoro publicly announced that, going forward and subject to the provisions of the SEC’s order in this matter, the only crypto assets that U.S. customers can trade on the company’s platform will be bitcoin, bitcoin cash, and ether.
Etoro has also stated publicly that “it will provide its customers with functionality to sell all other crypto assets for only 180 days after the issuance of the SEC’s order,” the regulator noted.
Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, commented: “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 company will also liquidate crypto assets deemed securities within 187 days if they cannot be transferred back to customers. The SEC described:
Without admitting or denying the SEC’s findings, Etoro agreed to the entry of a cease-and-desist order, to pay a penalty of $1.5 million, and, within 187 days of the order, to liquidate any crypto assets being offered and sold as securities that Etoro is unable to transfer to its customers, and return the proceeds to the respective customers.
What do you think about Etoro’s settlement with the SEC and the securities regulator’s enforcement regarding crypto assets? Let us know in the comments section below.