On Tuesday, Israel-based crypto trading platform eToro announced it will restrict access for U.S. users to Cardano (ADA) and TRON (TRX).
In its statement, eToro said:
“U.S. users will not be able to open new ADA or TRX positions as of December 26, 2021. Additionally, staking for these assets will end on December 31, 2021.”
The announcement caused sharp declines in the prices of both ADA and TRX. ADA was hit hardest, falling 5.4 percent over the past 24 hours, while TRX dropped by 2.5 percent.
Planned Removal of ADA and TRX from eToro
At present, eToro plans only to restrict opening new positions. That means U.S. users who already hold ADA or TRX can keep their positions and retain the option to sell those assets on the platform.
eToro also plans to limit sales of the two coins in the first quarter of 2022, after which the coins will be removed from the platform entirely.
According to the statement, the decision was driven by regulatory actions targeting cryptocurrency activity in the business context.
These current ADA and TRX restrictions apply only to the United States.
eToro is not the first crypto exchange to delist a token. Several exchanges, including Coinbase, removed XRP last year amid its dispute with the U.S. Securities and Exchange Commission.
Ben Caselin, head of research and strategy at crypto exchange AAX, commented:
“As the crypto industry grows in size, sophistication and influence, regulatory pressure on the altcoin space is likely to increase — particularly in light of recent comments from SEC Chair Gary Gensler about the likelihood that certain tokens and underlying tokens could be considered securities.”
The reasons behind eToro’s decision to delist these two coins may vary, but it is understandable given that eToro is a regulated brokerage serving the U.S. market.