eToro Implements Maximum Exposure Limits to Crypto CFDs

eToro, an Israeli social trading and multi-asset brokerage company, has released a notice about cypto CFDs.

The broker has implemented temporary maximum exposure limits for clients holding CFD crypto positions in certain countries due to what it sees as extremely high volatility in crypto markets.

eToro mentions that these measures only apply to eToro clients who hold or plan to hold CFD crypto positions. eToro’s real cryptoasset offering remains unchanged and the measures will not exert influences on clients that hold real cryptoassets.

The new valuation limits for crypto CFDs are: $3,000 per cryptoasset for BTC, ADA, ETH, and XRP $500 per cryptoasset for all other tokens.

Once the value of client’s position is above this exposure, the client will not be able to place any new buy orders for that cryptoasset. For example, if $50 of BTC as a CFD crypto position is bought and it is now worth $3,500, any new buy orders for BTC will not be able to be placed.

The brokers states that this does NOT impact existing CFD crypto positions, but if CFD crypto positions at or in excess of these limits are held, any new BUY orders will not be able to be placed.

CFD crypto exposure via copy positions or CopyPortfolios does not count towards this exposure limit. eToro expresses that it is working hard to ensure that this is just a temporary limitation as its goal is to enable clients to participate fully in markets in a safe and responsible way.

The company said in the notice, “We would like to remind clients that cryptoassets are highly volatile and stress the importance of holding crypto as part of a diversified investment portfolio.”