Brokerage company eToro is considering the possibility of limiting the purchase of cryptocurrency in case of a surge in trading activity.
January 14, 2021 | AtoZ Markets – Social trading platform and brokerage intermediary eToro is considering limiting functionality due to trading activity. Bloomberg writes about this , referring to the company's mailing list to its customers.
eToro sets limits on orders to purchase cryptocurrencies on weekends
The "unprecedented" demand for cryptocurrency, combined with limited liquidity on eToro, reportedly makes it impossible to maintain buy orders on the weekends.
“Because of this, we may need to set limits on orders to buy cryptocurrencies on weekends,” the company said.
EToro noted that high activity continues due to the nature of cryptocurrency trading sessions, which are available 24/7, unlike traditional financial markets.
If trading activity grows to a recent level, when Bitcoin fell by 20% per day, the broker may temporarily cancel the placement of orders to buy cryptocurrency, Bloomberg writes.
EToro clients intend to sue the company over restrictive measures
However, this will not be eToro's Bitcoin-related incident. Earlier, the broker's European clients accused the service of closing cryptocurrency contracts for difference (CFDs) without the ability to increase the margin to 100%.
Later, Yuri Toplak, a spokesman for those affected by the restrictions, said that customers of the service would apply to the Cyprus Securities and Exchange Commission to revoke eToro's brokerage license.
As of 2021, eToro has over 17 million users. Despite being founded in 2006, eToro still felt the pressure of Bitcoin. However, eToro is far from the only company in the cryptocurrency market that can't keep up with the influx of trading activity.
AtoZ Markets previously reported that the popular US-based crypto exchange, Coinbase has repeatedly gone offline amid a surge in bitcoin volatility. Some users later suspected the exchange of deliberate technical interruptions, mimicking the insurance leverage that is used on traditional stock exchanges.
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