While eToro is a key player in the world of cryptocurrency trading, the company is much more than this. eToro has led the fintech revolution for over a decade and built up a reputation as the leading social trading platform in the world. The company began as a general trading platform but has added cryptocurrency and other trading instruments to keep up with changing markets and growing demands. Today, there are over 6 million users registered on eToro, cinching its status as an industry leader.

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What Is the History of eToro?

eToro actually began back in 2007, back before cryptocurrency had even been introduced. Even so, those who want to use it for cryptocurrency trading should be familiar with where the platform came from and how it has evolved. It began with three entrepreneurs who wanted to make trading more accessible, no matter where or who you are. At the same time, they wanted to reduce dependency on banks and other traditional financial institutions. eToro started off as an online trading platform with graphs representing financial instruments and an intuitive interface. In 2009, eToro launched the trading platform, WebTrader, with a range of professional tools for traders of all skill levels.

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A big step forward came in 2011 with OpenBook, the first social trading platform in the world. This included the then-new CopyTrader feature, which let anyone copy successful traders. In 2012, eToro added stocks to its other assets, like currencies and commodities. The eToro mobile app launched in 2013 for both Android and Apple, expanding the reach of the platform. This is also when eToro dipped into crypto, making it possible to trade Bitcoin via CFDs.

In 2015, the platform updated the interface for an even more innovative and intuitive experience. In 2016, it added CopyFunds, managed portfolios that bundle various assets or top traders within a market strategy. Machine-learning engines usually drive these to maximize returns. Finally, in January of 2017, eToro expanded its reach in the world of cryptocurrency by adding support for trading crypto to the platform. It began with a range of popular cryptocurrencies, including Ethereum, Litecoin, and XRP.

Which Cryptocurrencies Does eToro Support?

Compared to other platforms, the options for supported cryptocurrencies on eToro are relatively limited. This is a result of its nature as a general trading platform as opposed to one focused solely on cryptocurrency. Even so, you can short or own the most popular cryptocurrencies. Supported options include Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, and Ripple.

Cryptocurrency Markets

What Sets eToro Apart from Other Platforms?

One of the biggest ways that eToro stands out from other platforms is the sheer number of investment and trading options available. Thanks to the numerous ways to invest and trade, users can take advantage of the same platform for their cryptocurrency trading needs as for traditional assets.

The social elements of eToro also make it unique. An example is CopyFunds, which is a long-term thematic investment in the form of a managed portfolio bundling assets and top traders with a predetermined strategy. The ability to copy the investments of successful traders is also innovative, as is the Popular Investor program.

What Extra Trading Tools Does eToro Offer?

This platform aims to educate traders as well as provide them with a platform for investment. Unfortunately, nearly all of these tools are geared toward those trading traditional assets as opposed to crypto. Even so, they can be useful for those who want to expand their portfolio to include more than just cryptocurrency.

Upon registration, eToro users get “virtual-money accounts” with $100,000 so they can work on strategies and skills before investing any real money. It also provides multiple other tools to help with actual trading, such as an economic calendar. Simply input the dates and time zone you want to look at and the assets you trade. The calendar will then display how events are likely to impact your assets. Additionally, it provides regular market analyses that include great detail as well as quick overviews, so you can utilize as much or as little information as you want.

What Are CFDs, and What Role Do They Play in Cryptocurrency Trading on eToro?

A CFD, or contract for difference, is a type of derivative trading. With a CFD, investors can speculate on whether fast-moving global financial markets will rise or fall. This can be done with cryptocurrencies as well as indices, shares, fiat currencies, treasuries, and commodities.

The important thing to note about CFD trading is that you will not be buying or selling the asset underlying it, in this case, cryptocurrency. Instead, you sell or buy a certain number of units for that instrument based on your prediction of if the price will rise or fall. When the instrument moves in your favor, you get multiples of the existing CFD units you already sold or bought. You make a loss for every point it moves against you. CFDs require caution since it is possible for losses to exceed deposits.

BTC Trades

On eToro, CFD trading and cryptocurrency go hand in hand. As mentioned earlier, eToro first entered the world of cryptocurrency by offering Bitcoin trading via CFDs in 2013, making it one of the earliest players in the world of crypto investments. CFD trading continues to play a key role on eToro since many of the trades involving crypto are still CFDs instead of dealing with the actual asset.

Starting on Sept. 3, 2017, those who invested in the BUY position for crypto on eToro actually own the asset underlying the transaction. Before this, they owned a CFD, not the asset. Additionally, eToro offers actual cryptocurrency trading. If you choose to open short or SELL positions for cryptocurrencies on eToro, this is still a CFD position.

What Are Crypto CopyFunds?

CopyFunds were added to the eToro platform last year. This feature is available for cryptocurrency trading as well as traditional fiat trades. This creates a single tradeable asset that is made up of carefully selected assets or traders of a predetermined strategy. The eToro Investment Committee composes the CopyFunds and rebalances them periodically. There are several cryptocurrency CopyFunds available for investors to choose from.

Crypto Copy Funds

One of these is simply called “Crypto-currency” and delivers exposure to Ethereum and Bitcoin. In the cryptocurrency bull run of May 2017, the fund had a 66 percent increase. Within the first three months, that fund generated over 125 percent in profits. Another option is called “Crypto CopyFund.” This is a more recent CopyFund made up of a balanced crypto portfolio containing Bitcoin, Ethereum, Ethereum Classic, Litecoin, Dash, and Ripple.

What Is CopyTrading?

Another exciting option on eToro that you can use for crypto and fiat investments is CopyTrading. This is the previously mentioned ability to copy traders of your choice. Traders have the ability to become Popular Investors if they have a low-risk score and deliver consistent returns. They then receive rewards for sharing wisdom. By taking advantage of CopyTrading and copying an investor who includes cryptocurrency in your portfolio, you can get exposure to the market without having to do too much research yourself.

Copy Trader

Who Can Use eToro?

eToro can be used by anyone, as long as it is legal to do so in their country. eToro keeps a running list of countries where the platform is blocked due to changes in the regulations that conflict with trading laws. This means that those in the United States, Canada, Cuba, Japan, North Korea, Iran, Syria, Turkey, Serbia, Albania, and Sudan cannot legally use eToro.

Does eToro Have a Minimum Trade Size?

eToro prides itself on offering tools that investors and traders of all levels of experience can take advantage of, so it tries to limit the use of minimum trades. Even so, you must have $200 to participate in CopyTrading and make a minimum investment of $5,000 for CopyFunds. The minimum quantities for manual positions are based on the instrument. For currencies (such as cryptocurrencies) and commodities, it is just $25. For stocks, it is $50. Finally, for ETFs and indices, it is $200.

For those who registered on April 2, 2017, or after, the size of a minimum trade depends on exposure, in the form of leverage times the invested amount. For cryptocurrencies, this total minimum amount is $200. The minimum for ETFs and stocks is $500, for commodities is $2,500, and for indices and Forex is $5,000. As an example of this exposure-related policy, if you open a crypto trade with a leverage of x1, you must invest at least $200. If, however, you chose to invest $100, you must have a minimum leverage of x2.

eToro Fees

As an exchange, eToro makes its profits from the various fees that it charges. On eToro, no fees are charged when opening a position, instead generating the fee based on the spread. It has a list of minimum spreads for each cryptocurrency, and those rates are not guaranteed. The team points out that the spread can vary based on liquidity and market conditions. The daily break spreads are as follows: 1.5 percent for BTC, 5 percent for BCH, 3 percent for DASH, 2 percent for Ethereum, 5 percent for ETC, 3 percent for LTC, 5 percent for NEO, 5 percent for XLM, and 3 percent for XRP.

Instrument Market Hours Daily Break Spread SELL BUY
BTC
Bitcoin
24/7
1.5 % -0.471233 -0.471233
BCH
Bitcoin Cash
24/7
5 % -0.14 0
DASH
Dash
24/7
3 % -0.039452 0
ETHEREUM
Ethereum
24/7
2 % -0.036712 -0.036712
ETC
Ethereum Classic
24/7
5 % -0.001726 0
LTC
Litecoin
24/7
3 % -0.006575 0
NEO
NEO
24/7
5 % -0.012383562 0
XLM
Stellar
24/7
5 % -0.0000416 0
XRP
Ripple
24/7
3 % -0.000022 0

Because of the nature of cryptocurrency trading, it is available 24/7, and there are no fees for overnight or weekend trades. Instead, eToro only charges fees for users who hold leveraged Ethereum or BTC positions or for shorting cryptocurrencies. The team does point out that the various fees are subject to change.

What Do Users Say About the Ease of Use?

Users and reviewers of the platform generally agree that eToro is very easy to use. It was designed to be intuitive, so those without trading experience could get the information they need and make trades. You can use the platform on PCs, Macs, Android, or iOS devices, always taking advantage of its intuitive functionality and readily displayed information regarding cryptocurrencies and other assets via graphs and more.

How Do You Deposit and Withdraw Money on eToro?

There are multiple deposit methods for eToro, so you can choose the one that best meets your needs, keeping in mind that different methods have varying minimum deposits. You can choose to deposit via wire transfers, bank transfers, Visa, MasterCard, NETELLER, PayPal, Yandex, Webmoney UK, Skrill, and others. To withdraw, you must fill out a form and then typically receive the money via PayPal, a bank transfer, or your credit or debit card. To withdraw, you will need a copy of your signature, color passport copy, and proof of address.

How to Fund Your Account

Is eToro Safe?

To provide users with peace of mind, eToro takes steps to provide security. The company as a whole is fully regulated and adheres to guidelines of FCA and CySEC. To help traders make responsible decisions, it offers a range of tools for all experience levels, such as guidance for the first steps and risk-management features. eToro also takes precautions to ensure the funds and personal information of clients are safe. Traditional funds remain secure in European banks of tier 1.

With all that in mind, you should remember that there are no regulations for cryptocurrencies. Because of this, if you engage in cryptocurrency trading or other crypto-related investments, there is no insurance from the investor compensation schemes within the UK or Cyprus. The lack of regulations also means that if you have a complaint, you cannot file it with your financial ombudsman service. Despite this, eToro takes pride in working to resolve issues as seamlessly as possible. In addition, there are numerous social platforms where you can register complaints, which may influence other users.

Conclusion

Although eToro focuses on more than just cryptocurrency trading, it is a useful platform for those who invest in crypto. The lack of supported cryptocurrencies is somewhat disappointing. However, there is support for all the major ones that you are most likely to invest in. The additional features of eToro are what give it an edge, such as CopyFunds and various graphs. The platform is also highly intuitive, something that will appeal to everyone. While eToro will not be ideal if you want to trade less-popular cryptocurrencies, it is an excellent option for those who only care about the major ones or who want to use the same platform for both fiat and crypto trades.

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eToro

eToro
9.2

Ease of Use

10.0 /10

Reputation

10.0 /10

Fees

8.0 /10

Customer Support

9.0 /10

Payment Methods

9.0 /10

Pros

  • Well-Designed Interface
  • Copy Funds & Traders
  • Trustworthy & Secure
  • Variety of Options
  • Range of Markets

Cons

  • No cryptocurrency deposits
  • Not many cryptocurrencies
  • Don't hold the assets

Posted by Oliver Dale

Editor-in-Chief of Blockonomi and founder of Kooc Media, A UK-Based Online Media Company. Believer in Open-Source Software, Blockchain Technology & a Free and Fair Internet for all.


All content on Blockonomi.com is provided solely for informational purposes, and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security, product, service or investment. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate.

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