Founded in 2007 and based in the U.K., eToro has more than 17 million users in approximately 100 countries, including millions of registered users in 43 U.S. states and Washington, D.C. as of 2018. At its start, eToro was a graphic-intensive forex platform and it has adapted those tools for crypto trading. Non-U.S. customers can trade additional asset classes such as contracts for difference (CFDs) and stocks on a variety of exchanges. This review addresses the different capabilities of eToro for U.S. residents versus non-U.S. clients.
eToro has made plans to go public via a SPAC merger lead by Betsy Cohen, the Chair of Fintech Acquisition Corp IV. About $650 million has been raised by investors including Fidelity Management & Research, ION Investment Group, Softbank Vision Fund II, Third Point LLC, and Wellington Management. eToro has been valued at around $10.4 billion.
United States residents who live in Delaware, Minnesota, New Hampshire, New York, Nevada, Puerto Rico, or Tennessee can sign up for an account but cannot yet trade. Residents of Hawaii, Guam, American Samoa, and the US Virgin Islands may not become customers. The firm is registered in all other states, allowing those residents to open accounts and trade.
The platform is well-tailored for those with a basic understanding of forex and cryptocurrency trading. The much-disliked withdrawal fee was eliminated for U.S. customers, though there is still a $5 fee for clients in other countries.
- U.S. residents in registered states can trade cryptocurrencies.
- Explicit commissions are not charged, but eToro takes the spread.
- The platform has a user-friendly, graphical interface.
- Traders can follow and copy the trades of profitable traders.
Who eToro Is For
EToro has a graphic-intensive platform that serves cryptocurrency traders in the U.S. Customers outside the U.S. can trade stocks and contracts for difference. The key feature of this unique proprietary platform is the ease with which an individual client is able to implement copy trading. The eToro platform features traders who want to be copied and who follow risk-control rules. This accessibility then allows retail account holders to mimic the trades and trading strategies of the most successful clients, automatically and in real-time. It must be noted that copy trading in and of itself holds no guarantee of either gains or losses.
The firm currently does not offer equity trading for U.S. customers. (When that happens, we will update our review.)
15 cryptocurrencies that can be traded 24/7
Easy-to-use website and mobile app
Great community for cryptocurrency traders
Spreads for trading cryptocurrencies are relatively wide
$25 minimum to buy any cryptocurrency
Relatively high minimums required for most copy trading
- U.S. customers have access to Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and XRP.
- The website and mobile app are nearly identical, attractively laid-out, and easy to navigate.
- Traders can see what others on the platform are doing and follow the recommendations of certain members who allow you to copy their trades.
- There aren’t explicit commissions charged, but trades are executed with specific spreads that vary from coin to coin. Some of these spreads are fairly wide.
- The minimum purchase for any cryptocurrency is $25, which makes it difficult for smaller accounts to spread their balances over more than a small number of coins.
- Though you can follow the transactions of some leading traders, you’ll need to have a higher balance to copy their trades. Most require a minimum of $200 for each copied trade.
Opening a new account is simple and can be accomplished online. Once you’ve submitted all the required information, it may take several days for your identity to be verified and your account to be opened. U.S. residents can open an account for $50, as can Australian residents. The minimum deposit for residents of Algeria is $5,000. Residents of all other countries require $1,000 to open an account (a temporary increase from the usual $200, according to eToros website). eToro uses Plaid to connect a bank to your trading account. In some countries outside the U.S., you can fund an account with a credit card as well as PayPal, Skrill, Neteller, Rapid Transfer, iDEAL, and Sofort.
Placing a trade is simple—just click on the “Trade” button while viewing the coin in question on your watchlist. There is a prominent “Buy” button on your portfolio listing; to sell a particular coin, click or tap the drop-down arrow and select ”Sell” from that list. You can close an entire position or just part of it if you’ve purchased it in several lots, but you cannot sell off a portion of an individual lot. For example, if you buy $25 of Bitcoin and then go to sell it, you must close the entire transaction rather than just $10 worth.
Users can create watchlists that can be customized and are shared with mobile apps.
Some non-U.S. asset classes allow you to set a stop-loss when you enter a position but that capability is not found in the version of the product available to U.S. residents. If you copy a trade, you can set the maximum drawdown.
Mobile Trade Experience
Placing a trade on a mobile device is very similar to the web order entry experience. There are fewer analytical capabilities on mobile apps, but otherwise, the experience is similar.
Range of Offerings
eToro offers 17 cryptocurrencies and is available to residents of all 50 states. There are no short sales, fixed income, options, or mutual funds offered.
Order types for U.S. customers are limited to market orders. There are no conditional orders available. Some stop-limit orders can be placed when opening a following trade. Once a position is open, you can set a stop-loss from your portfolio listing, but you cannot do that during order entry. For non-U.S. customers, users can set a buy rate, stop-loss, and take profit upon opening the position.
eToro’s trading algorithms are not described. Since stock trading is not yet available in the U.S., there are no statistics for payment for order flow.
You can use the virtual trading platform to get a handle on the asset classes available and how the platform works in your location by toggling from “Real” to Virtual,” located directly below your username after logging in.
eToro’s fees depend on your location and the asset classes traded:
- U.S. customers trading cryptocurrencies pay 0.75%-5.0%, depending on the currency being traded. This cost is built into the price at execution and is not transparent.
- Non-U.S. customers trading stocks pay no commission for opening or closing a long position. Short sales incur a commission of 0.18% of the value of the trade.
- Non-U.S. customers buying assets other than their home currency, such as a U.K. customer buying a U.S. stock, will pay a currency conversion fee.
- The inactivity fee is $10 USD per year for accounts with no activity for 12 months.
- There are no fees for withdrawing funds for U.S. customers, but you must withdraw a minimum of $30.
- Outside the U.S., the withdrawal fee is $5.
- Transferring a cryptocurrency out of eToro and into your own wallet incurs a fee, and there are minimums for each coin. Refer to the pricing and fees table for details.
There is no research hub on the eToro platform. You can dive into specific characteristics of each available cryptocurrency, including charting and some technical analysis, on the website. The News feed consists of posts by other eToro users. If you click on Help and then News and Analysis, a new tab opens with a series of somewhat disorganized blog posts. There are no screeners or trading idea generators.
There isn’t much portfolio analysis on the platform. Clicking on Portfolio displays your current holdings and the change in value since you opened the position. You can rearrange the available columns in the Portfolio listing, or replace one of them with “Net Invested” or “Fees” if you’d like, but customization is very limited. If you click on your own (or any other) username, you will see some statistics about trading profitability.
The education tools are on the light side for U.S. customers. If you click on Help Center on the Company drop-down menu, you’ll find a page organized by topic where you can browse educational materials about your eToro account, investing and trading, eToro wallet, deposits and withdrawals, and more. You can also do a general search on the websites home page “The Complete Guide to Fintech.” It’s worth going through the chapter that describes how eToro’s Copy Portfolios work if you’re interested in following other traders.
For customers outside the U.S., there are weekly webinars offered that go over the basics of trading stocks, currencies, and cryptocurrencies. This webinar link does not exist on the U.S. version of the website, but you can sign up to watch one of the recordings on-demand. Non-U.S. customers can also access eToro’s Media Center under the Company tab, which offers guides, podcasts, video tutorials, and a blog.
Accounts under $5,000 can access help online, and in a pinch, submit a trouble ticket to eToro’s customer service. You can chat with a live agent once you locate the light blue link to the chat service. Members of various levels of eToro’s Club, which kick in once you have a $5,000 balance or higher, are assigned a dedicated account manager. Accounts with $25,000 or more, at the Platinum Club level and higher, get perks that include priority customer support. Since the regular level of customer support can take up to 14 days to get a response, priority service is appreciated.
Note that phone support is not available (except in Australia), and there is no live broker support. Online chat is available from the Customer Service page.
- Biometric entry enabled for mobile apps
- No excess SIPC insurance (once stock trading is enabled in the U.S.)
- Registered in Cyprus
eToro offers newcomers to cryptocurrency trading an attractive platform that is remarkably easy to use—until you need help. Research offerings are light; you’ll have to do some digging and spawn a lot of new browser tabs, to access the education available.
It’s a very different experience for U.S.-based customers compared to those outside the U.S., who can trade additional asset classes and stocks from 15 countries. The ability to transfer crypto holdings to an external wallet is relatively rare and may appeal to investors who want to use their Bitcoin holdings for uses other than trading.
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