eToro is a major online brokerage focusing on stock, commodity, FX, and cryptocurrency trading. When it enabled support for Bitcoin (BTC) in 2014, it was one of the first online trading companies to support digital currency trading. Later, eToro introduced Ripple (XRP) and Ethereum (ETH). If you’re unfamiliar with the platform, this eToro review will get you up to speed and give you everything you need to know.
Today, eToro’s popular crypto offering supports more than 40 cryptocurrencies, it also provides a multicurrency crypto wallet and an enterprise-grade crypto exchange for professional traders.
eToro is a worldwide exchange with over 3,000 tradeable symbols that allow non-US consumers to trade FX, exchange-traded stocks, and cryptocurrency. eToro now offers exchange-traded fund (ETF) and stock trading to citizens of 44 states in addition to its existing cryptocurrency offering.
eToro, situated in Tel Aviv, was founded in 2007 by Ronen Assia, Yoni Assia, and David Ring. Assia is still the CEO of the company today.
eToro began as an online forex broker under RetailFX but later changed its name to eToro and began offering commodities, indices, and equities. It established itself as the world’s leading social trading network in 2010 when it launched its breakthrough social trading function, which allows users to replicate the trades of successful traders on the platform.
eToro announced support for BTC in 2014, allowing users to buy and sell CFDs on the world’s most popular digital currency (to non-US users).
eToro introduced ETH and XRP to the platform four years later. More digital assets were added in the years after that. With the launch of eToroX and a crypto wallet in 2018, eToro dived heavily into the cryptocurrency sector.
eToro is currently working to establish itself in the highly competitive crypto exchange market by strengthening its crypto trading offerings.
Cryptocurrencies Available on eToro
eToro and eToroX support 40+ coins trading. Take a look at some of eToro’s most popular crypto assets:
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- Cardano (ADA)
- Dash (DASH)
- Dogecoin (DOGE)
- Ethereum (ETH)
- Litecoin (LTC)
- Polkadot (DOT)
- Polygon (MATIC)
- Solana (SOL)
- Stellar Lumens (XLM)
Who Should Choose eToro?
eToro may be the best place for newcomers to cryptocurrencies who want to learn by doing. The site has a vibrant user community and social features such as coin-specific news feeds. Chatting with people and looking at social media feeds can be a great way to get started in the crypto realm.
The site includes tools that allow you to replicate the investing methods of top crypto traders—and get rewarded if others do the same. The latter section may appeal to more experienced crypto traders, who can receive annual rewards of up to 2% of their average balance for increasing their platform followers.
If you’re not a novice or looking to become a crypto influencer but want low trading fees and access to other assets besides crypto, eToro’s crypto exchange would not be your first pick.
How eToro Works?
eToro is solely a bitcoin trading platform. Users can deposit fiat currency (such as dollars) or transfer other cryptocurrencies into their accounts to use on the platform. Users can link their bank accounts for easy transfers or deposit funds via wire transfer instead. US dollar withdrawals are made directly to the user’s bank account.
Cryptocurrency trading can be done on eToro’s web-based platform via its user-friendly app once an account has been set up. If you’re not sure what to buy, you can use eToro’s CopyTrader function to copy the transactions of one of the popular investor programs.
eToro Trading Experience
Customers can deposit fiat currency from a bank account or debit card and start trading right away using eToro’s easy web-based platform and well-designed mobile app.
Users may examine current prices and buy, sell, or convert cryptocurrency using the simple “Trading” tab. eToro is perhaps most known for its social trading feature, allowing users to imitate top traders’ portfolio holdings and trades.
Although eToro provides basic market and limit orders and the possibility for non-US users to invest on margin, it lacks several of its competitors’ more powerful conditional orders, advanced charting features, and cryptocurrency pairs.
Eligible users in some jurisdictions can trade digital currencies such as Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH), and 1inch (1INCH), Compound (COMP), and Aave (AAVE). Eligible users can also participate in leveraged trading.
The ability to automatically replicate successful traders’ deals using the platform’s social trading function is arguably the most exciting aspect of eToro’s trading software.
eToroX includes all of the features you’d expect from an institutional-grade exchange, such as US dollar deposits, trading APIs, margin trading, and quick execution. It is a perfect trading platform for institutional and professional traders because of these capabilities.
eToro Commission and Fees
On crypto exchanges, especially ones that cater to newcomers, such as Coinbase and Gemini, pricing might be confusing. So it’s nice to see eToro explicitly state the costs (technically “spreads”) the company charges when you acquire cryptocurrency. Spreads vary for each coin and are subject to change based on market conditions.
However, eToro’s pricing mechanism is more convoluted than its competitors. When you acquire or sell an asset, you often pay a spread and pay for the “round trip” in advance on eToro. That means you’ll pay a spread on the purchase and a spread on the eventual sale of the coin.
If you intend to maintain your crypto purchases on the eToro platform or never move them anywhere else, the difference is semantic. If you expect your crypto purchases to appreciate over time, you may be able to save money by paying a lesser selling fee upfront because the market value of your crypto is lower when you buy it.
One of eToro’s main drawbacks is this. You can no longer move your coins back onto the eToro trading platform if you transfer them to a crypto wallet, including the site’s eToro Money wallet. In this situation, you’ve effectively forfeited the “sell” spread charge, which you’ll have to pay somewhere else.
Although eToro’s crypto trading fees are cheaper than those of competitors, customers should be aware of currency conversion and withdrawal fees. It’s also worth noting that prices may vary depending on where you are.
- Customers in the United States do not pay withdrawal fees, although there is a $30 withdrawal minimum. eToro charges a $5 withdrawal fee for withdrawals outside of the United States.
- For deposits and withdrawals made in currencies other than USD, non-US customers must pay a currency conversion fee starting at 50 basis points (bps).
- When you transmit cash from the eToro investment app to the eToro Money wallet, which is required to move coins off the eToro platform, you’ll incur a crypto transfer charge of around 0.50%, up to a maximum of $50. Based on eToro market rates, crypto-to-crypto conversion costs 0.1%
- Transferring cryptocurrency from eToro.com to the eToro Money crypto wallet will cost money. Fees vary depending on which coin you’re sending.
- For dormant accounts (more than a year), eToro levies a $10 monthly inactivity fee.
The spread varies for every cryptocurrency, shown below.
eToroX levies a 5 basis point transaction fee for price makers and takers. Furthermore, the exchange uses an inverted maker-taker model, in which price takers receive a rebate or pay a lower fee. Nevertheless, you need to contact the exchange for more information.
EToro has a web-based platform and a mobile app for purchasing, trading, and selling cryptocurrency. Users can access their dashboard and evaluate their portfolio and watchlist by logging into the eToro website. They can also follow popular traders or invest in a CopyPortfolio that replicates their favorite trader’s trades.
eToro’s easy mobile app is available to those who want to trade on the go. Users may purchase, sell, trade cryptocurrency, manage their investments, and follow popular traders. The mobile app is the only means to withdraw cryptocurrency from the eToro site, allowing users to transfer funds to the eToro Money wallet. You may then transfer those coins to another third-party wallet from the eToro Money wallet.
eToro Platform and Technology
Standard brokerage services such as price alerts, watch lists, news feeds, and customized charts are available on the eToro platform. Its unique community and automated trading models are what make it stand out.
CopyTrader and Popular Investor
Popular Investor and CopyTrader are flip sides of the same coin. Users can copy the crypto trading methods of prominent traders, known as Popular Investors, when signing up for CopyTrader.
There’s no cost to join—Popular Investors are paid directly by eToro—and once you’ve established yourself as a trader, you can apply to become a Popular Investor yourself.
There’s no cost to join—Popular Investors are paid directly by eToro—and once you’ve established yourself as a trader, you can apply to become a Popular Investor yourself.
You can also use eToro’s CopyPortfolios service to imitate the performance of eToro’s crypto-focused portfolios. It effectively transforms eToro into a hands-off, no-fee cryptocurrency Robo-advisor.
Social Trading Community
Throughout the eToro site, there are social media-like feeds of user opinions and comments. When you log in, you’ll get a general feed that covers user opinions on crypto, markets, and investment in general.
When you go to each currency or managed portfolio, you’ll see a particular feed with posts from users exclusively interested in that offering. These comments may be beneficial in generating trade ideas for people new to the crypto market; however, they cannot assure accuracy.
The eToro Club is a paid membership that gives customers access to additional benefits based on their account balances. (EToro calculates this formally using your “realized equity,” equal to the amount you’ve spent on eToro assets, including your cash holdings.) Users can become members after having $5,000 in purchased crypto assets or cash on their eToro account. Users who become members get access to a wide range of benefits.
- Trading support from a dedicated specialist
- Analyst reports and a market newsletter
- Webinars in real-time
- Access to new products, services, and features before they are released to the general public.
The eToro platform has two apps: eToro Cryptocurrency Trading and eToro Money. Both Android and iOS versions are available. The trading app is similar to the web platform, while the wallet app allows users to send and receive tokens and exchange cryptocurrencies for other currencies.
Users should be aware that the eToro Money wallet app is the only way to move funds away from the eToro site. It is a must-do step if you wish to store your crypto holdings in an offline cold wallet for maximum security.
Because not all competitors allow you to take your funds off their platforms, eToro has a competitive advantage in this area. Unfortunately, you will have to pay a fee to do so. If you plan to buy coins on an exchange and transfer them elsewhere for safekeeping, a platform such as Gemini, which offers a defined monthly amount of free transfers outside their site and lower trading fees, would be a better fit.
Pros and Cons of eToro
- The platform provides an engaging communal experience.
- Users can copy advanced users’ crypto trading tactics.
- It is possible to move your cryptocurrency holdings off the platform.
- a wealth of educational resources
- Paper trading allows you to put your tactics to the test.
- Several jurisdictions regulate it.
- Demo account
- Popular coins but no listing available on other major exchanges
- An app that is simple to use
- The fee structure is straightforward
- Fees are relatively high for all coins except Bitcoin.
- You pay more on transactions upfront because of the non-traditional pricing structure.
- In New York and numerous other US states, it is not available.
- You can’t move crypto back onto the trading platform once it’s been transferred to the eToro wallet for external use.
- Customer service is limited.
- Users in the United States are unable to trade on margin.
- Stocks and other investment opportunities are scarce.
Opening an eToro Account
It only takes a few minutes to sign up for an eToro account, and you must first create a username, password, and email address. Following the verification of your email address, eToro will ask you to answer a series of questions to establish your trading experience and risk tolerance.
Users of eToro must additionally authenticate their accounts. You’ll also need to give personal information, address proof, and a valid government-issued ID as part of this process. eToro alerts new users once their identity is verified, taking a few days.
Because your eToro account enables you to access trading platforms, enrolling for eToroX is as simple as clicking a button once you’ve registered an account on eToro.com.
eToro is a well-established online trading organization that provides a secure, regulated platform for crypto trading (for non-US customers) and has a long history of safely holding investor assets.
Most customer funds on eToroX are kept in cold storage to minimize the risk of funds being lost due to a hack or an operational error. In collaboration with premier cybersecurity firm GK8, the exchange has implemented a cold storage Custody as a Service (CaaS) solution.
In addition to storing customer cash in cold storage, eToro encourages account holders to adopt two-factor authentication (2FA) as an additional layer of security. Enabling 2FA, on the other hand, is not necessary.
Through its mobile app, eToro provides biometric identification via fingerprint scanning. It provides FDIC insurance up to $250k for all USD funds, which does not protect your cryptocurrency investments.
eToro’s customer support is divided into two parts: eToro and eToroX. Both systems have help centers and offer support through support tickets. Like those of many other crypto exchanges, phone support is not available.
To improve the experience of eToro’s most committed customers, the company hires account managers who take care of the most active traders (those holding $5,000 or more in equity on the site).
With over 23 million users worldwide, eToro consistently receives great customer feedback, as evidenced by the company’s Trustpilot score of 4.1 out of five stars from 11,000+ reviewers. 4. The app store ratings for eToro are also good, with 4.1 stars on Google Play and 3.7 stars on Apple.
However, current and previous users have expressed their dissatisfaction with the platform. The inability to withdraw funds and the long wait times for withdrawals are two of the most common complaints. Other users have complained about unexpected and higher-than-expected fees.
eToro Research and Education
The eToro site has many resources for researching and learning about specific currencies and the overall cryptocurrency market. Beginner to experienced users will benefit from the research and educational resources.
The eToro Academy is a collection of online courses and videos that cover anything from how to use eToro to specific coin profiles and investment techniques. The platform’s News and Analysis area delivers the most up-to-date crypto market news and thorough market analysis.
Not to mention the platform’s crypto paper trading option. It might allow new traders to acquire a feel for investing in a highly volatile asset class without putting their own money at risk.
How eToro Compares to Other Cryptocurrency Companies
Users can use eToro’s professional cryptocurrency exchange to perform a number of advanced trading methods.
eToro, one of the world’s most popular social trading platforms, was one of the first fintech companies to support cryptocurrencies before launching a cryptocurrency exchange and dedicated crypto wallet for its customers.
eToro is on its way to becoming a crypto behemoth, thanks to its size, 15 years of business experience, and large user base. These capabilities and its copy trading function set it apart from other crypto exchanges on the market today.
Trading of Stocks Offer
Stocks and ETFs are available as CFDs and as the underlying asset at this broker. Investors can simply buy actual stocks and ETFs without using leverage.
Trading Fees for Stocks
There is no commission when buying stocks or ETFs; however, when shorting as a CFD, there is a commission. It is possible to make trades for as low as $10. Fees are already factored into the spread. There are no charges for account administration.
Trading Places/Stock Exchanges
eToro allows investors to choose from 17 different stock markets, including the New York Stock Exchange, London, Paris, Saudi Arabia, and Oslo. However, eToro is slow to add equities, with only around 20% of the NYSE available for trading.
Offer for CFDTrading
Investors may trade over 2,700 equities, 12 stock indexes, 250 ETFs, and a dozen commodities. on eToro. Users can use copy trading to invest in any of the instruments listed above.
Costs of CFD Trading
At eToro, there are no account management fees and no commissions. Fees are incorporated into the spreads, which are also relatively small. When shorting stocks or ETF CFDs, EToro charges overnight fees and commissions. The use of any of the clone trade platforms is free. Withdrawals cost $5 per transaction, while non-USD payments incur a conversion fee.
eToro offers a wide choice of currency pairs to trade, including some of the more exotic pairs that aren’t available on many other platforms. It’s worth noting that eToro’s FX spreads are often high, with more competitive spreads available in the CFD and cryptocurrency markets.
The following FX pairs are available for trading on eToro:
US eToro users, on the other hand, can only trade cryptocurrencies; FX trading is not open to them.
eToro is a good choice for investors and traders who want easy access to the most popular cryptocurrency alternatives. It also has a CopyTrader program, which is unique in the business and allows customers to duplicate the investments of well-known traders.
eToro has higher fees than other crypto exchanges, with spread fees of up to 5%. However, eToro has no hidden fees or commissions, making it one of the more transparent cryptocurrency exchanges available. eToro also boasts a higher percentage of positive user ratings than most crypto exchanges, with users praising the company’s customer service and trading capabilities.
eToro allows you to trade stocks and ETFs as CFDs and underlying assets. Low commissions and more than 17 different stock markets to pick from ensure that traders of all types will remain interested. eToro, on the other hand, needs to speed up the process of adding new stocks.
eToro is a wonderful alternative for both newbie and expert traders because it offers over 3000 CFD products to trade on a free trading platform. On CFD transactions, traders will pay no commissions, and the spreads will be very small. Despite some minor costs incurred as a result of only trading in US dollars, this broker is still quite reasonable.
On eToro, currency trading allows you to purchase and sell a variety of international currencies while also following the advice and moves of successful Popular Investors. You can emulate the behavior of some of the finest traders on eToro by imitating their actions.
Overall, eToro is a beautiful alternative for investors who want to trade cryptocurrency but don’t want to keep their money in their possession. It’s a great way to share your trading ideas and learn about crypto trading from others by following profitable and established traders.
Disclosure: The author is not a licensed or registered investment adviser or broker/dealer. They are not providing you with individual investment advice. Please consult with a licensed investment professional before you invest your money.
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Tim Thomas has no positions in the stocks, ETFs, mutual funds, forex, cryptocurrencies, or commodities mentioned.
This article was produced and syndicated by Tim Thomas / Timothy Thomas Limited.
Featured image credit: Unsplash.