According to an email sent to customers earlier today, January 14, the Israel-based trading site eToro is unable to keep up with the demand of crypto traders.
“The unprecedented demand for crypto, coupled with limited liquidity, presents challenges to our ability to support BUY orders over the weekend.” As a result, the platform warns of “possible limitations to crypto BUY orders” and that “spreads on crypto assets may also be much wider than usual.”
As cointelegraph.com reported, eToro has been a victim of achievement of its own. Marketing manager Brad Michelson announced yesterday that 380,000 new customers had opened accounts in the previous 11 days and that trading rates had grown 25 times higher than at the same time in 2020. EToro boasted more than 17 million active users as of January 9.
Formerly an eToro market analyst, Quantum Economics founder Mati Greenspan told Cointelegraph that the warning note was “a symptom of a potential upcoming liquidity crunch.” He warned Twitter users against attempting to move funds off the platform.
If eToro introduces the predicted measures, users will be limited to their maximum cryptocurrency exposure and will theoretically be unable to place new purchase orders. Greenspan clarified that it actually means that certain people “might need to wait in order to buy in.”
In an attempt to get on top of new customer registrations, the exchange last week excluded European users from margin dealing due to increased market risks and increased the minimum deposit volume by 400 percent to $1,000.
Other exchanges are also seeing growing trading volumes, with the daily value of Coinbase on January 12 hitting $9.5 billion, up more than 50 percent from its previous all-time high of $6.5 billion on January 9. Binance has moved past its $23.7 billion mark, reporting more than $30 billion on January 12.