eToro was one of the first platforms for trading cryptocurrencies and has millions of users from over 140 countries. With its powerfully simple and user-friendly interface, it's grown to become more than just an app to trade cryptocurrencies – it's built up a thriving community where users get to engage, connect, and learn from one another.
It's absolutely free to create an account and you can dip your toe in by playing with a $100,000 virtual portfolio before putting in your own money. You can also use their CopyTrader technology that lets you mimic, in real time, what top traders are doing.
Since it's free, you can sign up and test drive all aspects of the platform.
What is eToro?
Founded in 2007, eToro claims to be the #1 social trading app for cryptocurrencies. It has more than 13 million users worldwide, operating in 140 countries around the world.
The company operates internationally but has its US headquarters in Hoboken New Jersey. But it actually has three international offices located in Cyprus, London and Tel Aviv. The app started out offering currencies and stock trading, but added cryptocurrencies in 2017. They began servicing the US market in 2018.
eToro operates as a diversified trading platform outside the US. You can trade stocks on foreign exchanges as well as currencies – in addition to cryptocurrencies. But for the time being, only cryptocurrency trading is available in the US.
The company has a Better Business Bureau rating of “B+”, on a scale of A+ to F. It also has a rating of 4.2 stars out of five by more than 41,000 users on Google Play, and five stars out of five on The App Store, however, that’s based on reviews by just three users.
How eToro Works
This is the social feature of the eToro system and it’s at the heart of the platform. Using CopyTrader you can find your favorite featured eToro users and copy all their trades in a single click.
This feature can be important for crypto traders at any level, but especially for beginners. It will enable you to take advantage of the experience and expertise of other traders within your own portfolio.
Best of all, you can sign up for the CopyTrader feature at no additional charge. In fact, there aren’t even any management fees or costs involved.
And just in case you’re feeling a little guilty over copying the work of top traders on the platform, know that those traders get paid directly under the Popular Investor Program.
In fact, once you become familiar with trading cryptos on the platform, you can become part of the Popular Investor program and earn income while others copy your trades. It’s an opportunity to earn extra income on a monthly basis as well as to be featured prominently as a leader in the eToro community.
You’ll earn a fixed payment for each copier, as well as bonuses for moving up in rank. This income is above anything you’ll earn from your own trading. And naturally, the more people who copy your trades, the higher your income will be.
The income hierarchy for the Popular Income Program is as follows:
Like many large investment brokerage firms, eToro also enables you to “paper trade” before you go live and risk real money. You’ll have access to a virtual portfolio of $100,000 to practice your investment strategies and learn how to platform works without risking your own money.
In the cryptocurrency universe, a digital wallet is necessary to securely store your cryptos. You can transfer your cryptos from the trading platform to your digital wallet, as well as both send and receive cryptos to and from other wallets. You can also use the wallet to convert one crypto to another.
Though you can always use an external digital wallet, there are obvious benefits for taking advantage of the same service with the platform where you trade cryptos. You’ll have a wallet immediately available for easy transfers from the trading platform, and also avoid the fees of having a separate wallet with a third-party provider.
There are no fees to send or receive transactions to and from the wallet. However, blockchain fees are applicable to all transactions.
Unfortunately, it’s not possible to send cryptos back to the trading platform from the wallet.
Similar to robo-advisors for stock portfolios, eToro offers CopyPortfolios to provide a premium portfolio management product. It will automatically copy multiple markets based on a predetermined investment strategy. Each portfolio is periodically rebalanced to keep the investment mix on target.
US investors have access to four CopyPortfolios:
- CryptoEqual: Invests in the leading large cryptocurrencies with equal allocations in each. The minimum investment is $5,000.
- CryptoPortfolio: Invests in cryptocurrencies with a market cap of over $1 billion. The minimum investment is $5,000.
- Crypto-currency: Invests exclusively in Bitcoin and Ethereum, the two most popular cryptos. The minimum investment is $5,000.
- The TIE-LongOnly CopyPortfolio: This is a unique portfolio that uses highly advanced natural language processing tools to track sentiment for cryptos on the social networks. For example, it accesses Twitter to determine public sentiment toward cryptos. It requires a minimum investment of $2,000.
One of the disadvantages with CopyPortfolios is that you can’t liquidate part of the investment. The only way to liquidate your position is to close out your entire investment. And as is typically the case with robo-advisors, you won’t be able to adjust the specific positions in any managed portfolio.
eToro Features and Benefits
|Minimum initial investment||$50, but you will need a minimum of $25 per trade.|
|Acceptable payment methods||Deposits through online banking or wire transfers only.|
|External payments||Cannot be made through the eToro account itself, but can be made through the eToro Wallet.|
|Availability||In addition to being available in 140 countries, eToro is available in 41 US states and the District of Columbia. The nine states where it is not yet available include: Delaware, Hawaii, Louisiana, Minnesota, Nevada, New Hampshire, New York, North Carolina, and Tennessee.|
|eToro Mobile App||Available on Google Play for Android devices 5.0 and up, and on The App Store for iOS devices, 10.0 or later. It’s compatible with iPhone, iPad, and iPod touch.|
|Customer service||Available only through the app. No phone contact is offered. Though the site mentions live chat, it emphasizes contact by opening a support ticket. The feature is available 24 hours a day from Monday to Friday.|
|FDIC Insurance||Funds held at eToro USA are fully FDIC insured. The funds in the account are held in an FDIC insured custodial account, which will be insured for up to $250,000 per depositor. This insurance coverage is available only to US residents. It covers your cash on deposit only, not the value of your cryptocurrency holdings.|
eToro Pricing and Fees
Since eToro enables you to trade in multiple cryptocurrencies, they have a different fee schedule for each currency. In fact, rather than charging fees for a crypto, they instead work with spreads. This is very similar to the bid/ask spread used by investment brokerages that similarly charge no commissions for trades.
For example, the lowest spread is on Bitcoin, which is 0.75%. We can presume Bitcoin has the lowest spread because it’s the most common crypto.
Next on lowest the spread are other commonly traded cryptocurrencies, like Ethereum, Litecoin, Bitcoin Cash, NEO, and Ethereum Classic, all of which have spread of 1.90%.
Less commonly traded cryptocurrencies have higher spreads. For example, Tezos (XTZ) has the highest spread at 5.0%. Next is IOTA (MIOTA) with a 4.50% spread. Meanwhile, TRON (TRX) and ZCash (ZEC) currently have the spread set at 3.50%.
Other fees you can with eToro are as follows:
- Withdrawal fees, $0
- Wallet Send/Receive fees, $0
- Wallet Crypto-to-Crypto conversion fees, 0.1%
Refer a Friend Bonus: You can invite friends to join eToro through your app link. If that friend signs up for an account and makes a trade of at least $100, both you and your friend will receive a $50 bonus. No maximum number of referral bonuses are indicated, so this can be an additional source of income on your account.
If you want to dig deeper into how to invest in cryptocurrency you can check out this article here.
eToro Pros & Cons
- No experience needed – you can learn the ropes by literally copying the trades of other investors on the platform through the CopyTrader program.
- You can open an account with just $50 and begin placing trades with as little as $25 each.
- You can earn additional income – over and above your trading profits – by becoming part of the Popular Investor Program.
- The app can be used to trade several different cryptocurrencies.
- The refer a friend program provides an opportunity to earn a $50 bonus for each referral who opens an account with at least $100.
- FDIC insurance is provided on all cash deposits up to $250,000.
- Deposits can be made only by online banking and wire transfers.
- Cryptocurrency held in your account cannot be used to make external payments. However, those payments can be made through the eToro Wallet.
- Once a crypto has been transferred into the eToro Wallet it cannot be transferred back to your trading account.
- Not available in nine US states.
- Customer service is available in-app only; there is no phone contact available.
- Though eToro offers trading in stocks and currencies outside the US, trading is limited to cryptocurrencies in the US.
Should You Invest with eToro?
Perhaps the first question that needs to be answered is do I want to invest in cryptocurrencies? At the moment, it may be the most alternative of alternative investments! After all, cryptocurrency has been around for only about a decade, and has seen some incredible price swings during that short space of time.
But if you do decide to invest in cryptocurrency – and you should only do so with a small percentage of a well-balanced portfolio – eToro is an excellent choice. There are plenty of cryptocurrency exchanges around, but eToro offers the advantage of being a comprehensive cryptocurrency investment platform.
Not only does it give you the ability to trade in multiple cryptocurrencies, but you also have the advantage of the CopyTrader program that enables you to duplicate the trading and investment strategies of more seasoned investors.
That’s in addition to the Virtual Portfolio that starts you out with $100,000 in play money to help you learn the ropes before committing real money. And if you prefer professional management, you can also take advantage of CopyPortfolios, which work much like robo-advisors for cryptocurrencies.
eToro stands out as what might be the closest thing to a comprehensive investment platform specializing in cryptocurrencies. If you’re going to invest in cryptocurrency at all, eToro is a solid platform to use.
eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.
- No experience needed
- Open an account with just $50
- Earn additional income through the Popular Investor Program
- Trade several different cryptocurrencies
- Customer service is available in-app only
- Not available in nine US states
- Trading is limited to cryptocurrencies in the US