For new investors, trading platforms like eToro are offering innovative investment tools that allow you to easily manage your portfolio.
If you are considering opening an account, this eToro review will take a closer look at how it works and what to expect before you sign up.
What is eToro?
eToro is a leading discount brokerage and social trading platform that supports retail investor accounts. The platform launched in 2007 out of Israel. Today, it has more than 25 million users across 140 countries.
The company is a U.K.-regulated Financial Conduct Authority (FCA) and is registered in Cyprus under the Cyprus Securities Exchange Commission (CySEC). It’s also regulated in Australia under the Australian Securities & Investments Commission (ASIC).
Investing with eToro
In the US, the platform supports a variety of investments — including cryptocurrencies, stocks, and ETFs.
Overall, the site provides access to fewer coins than competing online broker Coinbase, which offers 25. eToro has 19. But there is still a decent variety to trade.
Some of the most popular cryptocurrencies on eToro include Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Dogecoin (DOGE), Ripple (XRP), NEO (NEO), Dash (DASH), EOS.IO (EOS), Stellar (XLM), and Litecoin (LTC).
Trading cryptocurrency is easy on eToro. You shouldn’t have a problem finding and purchasing coins.
With eToro, you can invest in fractional shares from leading US companies. Invest in stocks with 0% commission and no limits on trading volume (only available for select customers).
Diversify your portfolio with Exchange-Traded Funds or ETFs, a low-cost and flexible way to invest in the financial markets without management fees.
Try Out eToro for FREE
Every new account holder also has the chance to get the hang of investing without any risk. New eToro users are credited with $100,000 in a virtual portfolio that they can use as practice, then switch to real trading whenever they’re ready.
eToro offers several innovative tools to help investors make the most of investments.
Advanced Charting and Data
Predicting a coin’s behavior is very difficult. But eToro simplifies the process by giving you access to charts and analysis tools.
Using these features, you can view a coin’s past performance and use that insight to make an informed estimate of future results.
The company also offers a watchlist tool that provides real-time updates, enabling you to keep your fingers on the pulse of your portfolio at all times.
CopyTrader is a social trading tool and is one of the platform’s most popular features. Some users describe this feature as Facebook for crypto trading. You can see what other traders are doing in real-time on a news feed and automatically mirror their moves.
For example, a top trader may dump Dogecoin at a strategic time to make a profit. You can set up your portfolio to do the exact same thing. It’s a useful way of getting actionable investment advice without having to do any heavy lifting.
In this light, CopyTrader is a bit like using a robo investor service for stocks except you’re trading coins based on human patterns instead of algorithms. Simply select the user you want to copy, and the platform automatically duplicates their transactions in your account.
If you’re an awesome trader, some other folks might even decide to copy your moves. All you have to do is make your profile public.
Popular Investor Program
Successful investors on eToro have the opportunity to participate in the Popular Investor program, which lets you get paid when people copy your trades.
This program works on top of the copy trading feature. It allows popular and successful traders to essentially build a business by encouraging other investors to copy their trades.
eToro offers four different tiers for this program: Cadet, Champion, Elite, and Elite Pro.
eToro offers a digital wallet called eToro Wallet that enables you to store cryptocurrency on your mobile device. The wallet supports over 120 cryptocurrencies at the time of writing.
You can use this digital wallet to securely buy, store, transfer, and receive coins — including ones that the platform doesn’t support.
0% Commission Trades
International customers can trade stocks and ETFs on eToro without paying commission or management fees — which is a pretty good deal any way you look at it.
The company also offers contract for difference (CFD) trading through CFD brokers. Essentially, you’re buying contracts instead of purchasing assets directly. This is a bit nuanced for most investors.
According to eToro, 77% of retail investors lose money on CFDs. So, unless you’re a pro, you’re probably best off investing in other assets.
eToro Trading Academy
Looking for some tutorials to learn more about trading crypto? eToro has you covered.
Head over to the Trading Academy to check out a variety of educational videos. It’s a great resource to explore if you want to learn more about trading on eToro.
eToro Pricing and Fees
While you won’t have to pay any deposit or trading fees when trading cryptocurrencies on eToro, the company does charge a spread. In case you’re unfamiliar, a spread is a fee that represents the difference between the bid and the offer price. The fee for buying or trading crypto is equal to 1% and is included in the price.
eToro has a minimum trade amount of $25 and a minimum withdrawal amount of $50. The company also charges a conversion fee of $5 when withdrawing and depositing foreign currencies.
Luckily, it doesn’t cost anything to copy another trader on eToro. So, if you know someone who’s making killer deals over and over again, you can mirror their moves for free. That said, there is a minimum trading amount of $200.
The company also charges a $10 inactivity fee for accounts that aren’t used for 12 months, so be sure to keep your account active if you plan to sign-up.
How to open an account with eToro
Signing up and starting with eToro is easy.
1. Sign up for eToro
Download the app or head over to eToro’s registration page. Enter your name and email address and create an account.
2. Verify your identity
After you sign up for eToro, you will need to verify your identity. To do this, you’ll have to upload a proof of identity (POI) and proof of address (POA).
POI can include a passport, driver’s license, or any government-issued ID. Simply upload the image to the app and wait for approval.
The verification process may take a few days. Since time is money, this can be a bit frustrating. In the meantime, continue educating yourself about the cryptocurrency market. This way, you can hit the ground running and start investing once your account is activated.
3. Make a deposit
Once eToro confirms your identity, the next step is to make a deposit.
Funding the account is fast and easy. You can use a debit card and pull money from your bank account or you can use services like PayPal, Neteller, Skrill, and Rapid Transfer, among others.
4. Trade crypto
The next step is to browse cryptocurrencies and start buying coins.
It helps to have a strategy when buying cryptocurrencies. For example, some investors choose to buy using dollar-cost averaging where you make small purchases at specific intervals.
As you advance in skill, you may want to try buying with the golden cross or death cross strategy, which tracks moving averages.
Of course, you can always take the easy way out and automate buying by copying other users. It doesn’t cost anything and you will probably do better than attempting to buy and sell random coins on your own.
5. Cash out when you want
You can cash out on eToro at any time you want. Just keep in mind that you’ll pay a withdrawal fee of $5.
Further, the IRS considers cryptocurrency property. If you hold an asset for less than a year, you’ll face a short-term capital gains tax. If you hold the asset for a longer period, you’ll face a long-term capital gains tax, which generally means you can keep more of your money.
Tax strategy plays a pivotal role on the road to financial independence. Before liquidating any cryptocurrencies, you need to think about how much you’ll owe the taxman.
eToro Promotions, Bonuses, Coupons
eToro Refer-a-Friend program
The company is currently offering a referral incentive. You can receive $50 if you get someone to sign up for the service.
Keep in mind that the individual you refer has to be a new eToro user and a resident of an eligible U.S. state. They also can’t be a member of your household.
In addition to signing up, the person has to verify their account and make a trade of at least $100. If you can meet these criteria, you’ll have $50 to trade. It’s a pretty decent promotion if you ask me.
eToro offers standard app security features like two-factor authentication, encryption, and firewalls. The app is very safe to use and completely trustworthy.
Customer service is available through the eToro customer service center.
You can submit tickets, search through a knowledge base for answers and initiate a live chat session with an agent.
Unfortunately, if you have issues with your trading account, there isn’t a phone number to call. One troubling discovery is that the company admits that it may take up to 14 days to get back to you about requests. Yikes!
Pros and Cons
- Access and trade 19 cryptocurrencies
- Automated trade copying for easy, hands-free investing
- Digital wallet for secure storage with over 120 coins
- Crypto staking rewards
- eToro mobile for on-the-go trading for both Android and Apple devices
- Demo account available
- Works with credit cards including Visa, Mastercard, and Maestro
- Secure platform for virtual trading
- Reasonable minimum deposit of $50
- Fewer cryptocurrencies than competitors like Coinbase
- Limited customer service; no phone support
- Spread and withdrawal fees
Alternatives to eToro
Coinbase is a leading platform for buying and selling cryptocurrency that lets users buy and sell 25 different coins.
The company also offers a crypto vault for secure storage, a user-friendly mobile app, and automated crypto scheduling for repeat buys.
Cash App now supports cryptocurrency trading — but only for Bitcoin. You can buy Bitcoin on Cash App, use it to pay bills, send and receive money, and invest in stocks.
This app is becoming more and more popular, so if you’re interested in crypto, you should definitely check it out.
Bisq is a decentralized, open-source platform that you can use to privately sell Bitcoin and other cryptocurrencies. You don’t need to register to use Bisq, and it’s completely free to use.
Frequently Asked Questions
Is the eToro platform worth it?
It largely depends on your individual goals as an investor.
If you want to diversify your portfolio and expand into the crypto market, then eToro can be a great choice. Cryptocurrency is risky, but it can also lead to huge payouts.
Consider investors who purchased Bitcoin when the price was hovering around $4,000 in March 2020.
As long as you’re responsible and know what you’re doing, eToro can potentially lead to big profits. Just don’t invest any more money than you are comfortable with losing.
Is eToro reliable?
Most users find the platform intuitive and easy to use. It’s highly reliable, with a strong user interface that works great whether you’re on a desktop or mobile device.
There’s a reason eToro has over 20 million users, after all.
But, at the end of the day, you still have to be very careful when investing in cryptocurrency. Always research a platform before opening an account and use caution when working with platforms you’re not familiar with.
What percentage does eToro take?
eToro doesn’t charge any commissions or fees for crypto trading. Instead, the company charges a spread for cryptocurrencies.
At the time of writing, Bitcoin currently has a spread of 0.75%, Ethereum has a spread of 1.90%, and Ripple has a spread of 2.45%.
Does eToro provide insurance?
U.S. residents who use eToro have the peace of mind that comes with knowing their deposits are secured by the Federal Deposit Insurance Corporation (FDIC). If eToro fails, your balance is covered up to $250,000.
If a coin plummets in value, you won’t receive anything.
Is crypto real money?
Crypto is virtual money with cryptography-based security. You can trade many coins for USD, and a growing number of merchants are now accepting coins as payments, too.
Suffice it to say the crypto market is very diverse. Not all coins are equal in value. As such, it’s critical to research coins before making any purchases.
Is eToro right for you?
Trading platforms like eToro aim to make cryptocurrency as easy as shopping on Amazon. This particular app offers “digital currencies at your fingertips.”
But here’s a disclaimer: Cryptocurrency is anything but simple or easy, and you must know this before diving in.
For example, Bitcoin hit a record high of $64,829 in April. Today, the price is hovering around $33,373 — a massive decline in value in a few short months. Most altcoins tanked too.
At this point, it’s anyone’s guess where the cryptocurrency market is heading. As an investor, you have to assess the market and decide if you want to take a gamble.
Play your cards right and you can make a lot of money on a platform like eToro. At the same time, you can lose everything.
No one said the road to financial freedom would be easy. Here’s to making the smartest moves as you work toward long-term financial independence.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs. Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision. Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk. Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply. eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.