eToro, one of the largest international brokerage platforms, has reduced the leverage for new trading positions in the banking sector to X1.
The company took such action after the collapse of Silicon Valley Bank (SVB), a US lender that targeted early companies. Another US bank, Signature Bank, was shut down by regulators as a result of the development. In addition, prior to SVB’s bankruptcy, cryptocurrency-friendly Silvergate Bank suspended banking operations.
Shares of American banks began to lose value. However, eToro has limited leverage to future positions only, and existing positions will be retained.
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With its financial services in 140 countries including Cyprus, the UK, the US, and Australia, eToro allows clients to trade stocks, commodities, and CFDs. The broker’s asset list also includes shares of US banks such as Bank of America, Citi, Goldman Sachs, and JPMorgan Chase & Co, as well as other global banks.
However, recent events in the banking sector have forced the company to introduce restrictions on the use of leverage.
