Categories: Market

Expect more scrutiny of cryptocurrencies from regulators, says eToro

The crypto-friendly trading platform eToro expects regulators to tighten their scrutiny over the crypto industry given the increasing involvement of retailers and smaller investors. In a comment to the Financial Times, Israel-based company’s CEO Yonni Assia said:

“We see a significantly increased interest from private investors and traders in the crypto market. As part of this growth, we should also expect regulators to carefully examine this growing retail investor business in the cryptocurrency market. “

Earlier this year, eToro struggled itself to keep up with “unprecedented” demand from crypto traders as over 380,000 new users opened accounts in 11 days.

Assia’s comments to the UK’s leading financial newspaper were also heated following the intervention of the country’s Financial Conduct Authority, which this week ordered the leading cryptocurrency exchange at the helm of Binance to suspend all regulated activities in the UK.

While more regulation is a given, Assia also argued that “the most important thing for regulators is to understand crypto and understand that it is here to survive.” The eToro CEO has a perspective that spans a number of different jurisdictions. Based in Israel, nearly 70% of eToro’s users are in Europe, and the company is currently targeting the United States, where it hopes to go public following a merger with a purpose maker (Spac).

Assia says that cryptocurrency literacy is vital not only for regulators, but traders themselves need to be aware of the risks they are taking in a fast-paced industry. “An asset that goes up 100% can very easily go down to 50%,” he said. There is no doubt that when something goes up 1,000% it is very volatile and you should understand this as part of your portfolio allocation. “

eToro was founded in 2007 and has been supporting Bitcoin (BTC) trading since 2013. In the same quarter, the company recorded three million new signups – a huge increase as eToro added around five million new users in total over the course of 2020.

Connected: EToro IPO: Yoni Assia CEO reveals key details behind the move

Assia previously described 2020 as a “big year for stocks” but noted that 2021 was “dominated by crypto headlines”. At the end of January, he found that the crypto trading volume at eToro had increased more than 25 times compared to the same period last year.

While Assia believes regulation is likely to increase consumer demand, other industry experts take a different view. Speaking to Cointelegraph earlier this month, Marc Powers, a law professor and former attorney with the Securities and Exchange Commission said:

“Regulations […] will be primarily for the benefit of the government and the bank, not really for consumers or investors. As a result, I see a continuation of a dual system, one owned, used and managed by the people, the other – the traditional financial system that will eventually provide currencies. “

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CoinX

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