eToro Cryptocurrency Exchange Review
Before the dawn of Bitcoin, eToro emerged in 2007 in Israel with one vision in mind: to make trading accessible to anyone, anywhere, and reduce dependency on traditional financial institutions. eToro started out as an online social trading platform for stocks and other financial instruments. However, once cryptocurrency started gaining ground, it was only a matter of time before they started to offer cryptos as investment products.
Although eToro is known today as a significant player in the world of CFDs and cryptocurrency trading, it wasn’t always known this way. These trading features were a relatively recent addition which was made to account for the continually changing financial market. These days, over 6 million users enjoy working through eToro and trade a wide range of financial assets and use complex instruments.
Read on to learn more about eToro, how it works, and how it compares to other cryptocurrency exchange services that are available on the market today.
About the Trading Platform
eToro first started as a simple fintech platform for trading financial instruments in an accessible, easily-understandable way. From there, it went through a few different name changes, which eventually resulted in the creation of the first eToro mobile app in 2012. Over the next five years, it became known for its combination of online trading capabilities, portfolio management functions, and social trading features.
Skip to 2017—at this point, the eToro platform had added in cryptocurrency trading for the most common currencies, including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. One year later, they began servicing the U.S. market by offering cryptocurrency exchange services before running into some red tape related to the CFDs work. We can’t yet say what’s to come next for eToro, but they’ve gained valuable experience by being in the exchange game for over a decade.
So, what makes eToro different from any other trading service or cryptocurrency exchange? For one thing, it focuses heavily on incorporating a social aspect into the trading process. Their platform allows traders to share their successes, failures, and words of wisdom so that participants can learn from others in the trading community.
Once you’ve opened your eToro account, you can start benefitting from the trading opportunities, educational tools, and social trading features that it provides. Whether you’re most interested in trading stocks, exchanging cryptocurrencies, or working with other financial assets, eToro has something for everyone. It’s particularly suitable for beginner traders who want to get into the industry and would like some direction as they take their first steps.
For example, eToro offers users a demo account containing $100,000 of virtual money which they can use to practice their investment strategies in a risk-free way. That way, they can see how they would fare when they trade with at real costs, learning about the market as they go. eToro additionally provides market analyses in varying degrees of detail so that you can go as in-depth as you wish with your market research.
What differentiates eToro from other platforms is the wide variety of investment and trading options. Most cryptocurrency exchanges focus only on cryptocurrency-based services, but eToro combines them with many other traditional financial assets. The range of services and community support makes eToro a unique multi-asset platform among its competitors.
Being a cryptocurrency exchange is not eToro’s singular function. As a result, the platform lacks a variety of cryptocurrency offerings. The limited options, when compared to some of the top-name cryptocurrency exchanges, do pale in comparison. The same is true for currency pairs.
Unfortunately, that’s the reality of working with a platform that doesn’t focus all its resources on optimizing cryptocurrency exchanging. However, they do support the most common coins, including the following:
- Bitcoin (BTC)
- Ethereum (ETH)
- Litecoin (LTC)
- Ethereum Classic (ETC)
- Dash (DASH)
- XRP by Ripple Labs (XRP)
- Stellar (XLM)
- NEO (NEO)
Trading cryptocurrency on eToro is about as easy as it is to trade anything else on their platform. At the click of a mouse or the swipe of a finger, you can enjoy the convenience of having your market order executed immediately. If you’re new to currency trading, eToro also offers plenty of educational videos, as well as an active support community that can help you grasp the basics. You can trade with confidence in no time.
To fund your account, you can choose to make a credit or debit card deposit in EUR/USD/AUD/GBP or pay via Neteller, PayPal, Skrill, iDEAL, or make a wire transfer. You can check the platform’s deposit FAQ for maximum or minimum deposits and deposit restrictions based on the user’s location.
Beyond trading stocks and cryptocurrencies, eToro is also best known for serving as a platform for trading CFD assets. These are incredibly high-risk instruments that cause novice traders and retail investor accounts to lose money quickly. Particularly if they enter into trading recklessly, without the help of a professional financial advisor. Only utilize this aspect of eToro trading if you’re comfortable assuming the financial risk that comes with it.
Fees and Limits
Like any trading or exchange service, eToro makes its money on the various fees that it charges for the different services that it renders. However, what makes eToro’s cryptocurrency fee system unique is that eToro charges no deposit or trading fees other than spreads if you pay in USD. Otherwise, other fiat currencies incur a conversion fee.
For detailed information on the spread percentage for each cryptocurrency, visit the “Market Hours & Fees” section of their website.
It’s important to note that the spreads advertised on their website are minimal and not guaranteed in any way. They are also subject to change based on market conditions. If you wish to make a withdrawal from eToro, you will incur a $25 withdrawal fee, and the withdrawal amount has to be at least $50.
Another fee you have to look out for is eToro’s $10 inactivity fee. This fee is incurred when you fail to log in to your account for 12 consecutive months. Be sure to check in with your account every few months even if you don’t plan to do any exchanging. While this is only a minor fee, we still recommended that you watch out for it.
Although eToro markets itself as being available for its users 24/7, it’s a bit difficult to get an instant response from their customer service personnel. You won’t find any phone number for real-time assistance, except for that of their Australian branch. If you have a pressing problem for any reason, you may not be able to get a quick solution.
What they do offer is an online ticketing system, which answers your inquiry via email. This can take anywhere between a few minutes to a couple of hours. Many customers have reported dissatisfaction on social media, despite customer service employees maintaining a professional and composed tone. However, they offer support in multiple languages, including English, Spanish, Italian, German, Russian, French, Polish, Chinese, and Arabic.
Despite what eToro lacks in live support, they do offer a lot of resources for you to find answers to your questions. The social trading concept enables an active community eager to help solve one another’s problems. There is also a comprehensive FAQ page, which covers plenty of questions on a variety of topics relevant to the platform.
Since eToro is so highly-regulated by several different authorities around the globe, users can trust that it’s a safe place to carry out trading and cryptocurrency exchange. The required safety measures, such as phone-based two-tier authentication and SSL encryption, ensure the safety of your assets, account, and data.
Frequently Asked Questions (FAQ)
Let’s take a look at some of the most frequently asked questions about eToro. A more extensive FAQ is available on eToro’s website.
Does eToro Support Mobile Trading?
Yes, eToro’s mobile app is used by thousands of people every day. The user-friendly interface is a great option for trading assets and exchanging cryptocurrencies. Follow their website’s simple process for making an account and link your account to the app.
eToro’s app is supported by both Android and Apple and available on the Google Play Store and iOS App Store, respectively. eToro doesn’t have a desktop app, but their website is well built.
Is eToro a Scam Platform?
EToro is not a typical crypto exchange platform which is why a lot of crypto traders suspect in its reliability. However, eToro is a completely authentic trading platform and no scam. Over the years, eToro has proven itself as being a safe platform for a variety of different financial services. The platform is regulated by a handful of top-tier regulators, including FCA (Financial Conduct Authority of the United Kingdom), ASIC (Australian Securities and Investments Commission), ESMA (European Securities and Markets Authority) and CySEC (Cyprus Securities & Exchange Commission).
What Countries Are Supported by eToro?
When it comes to using eToro, the more relevant question is, “Which countries are NOT supported by eToro?” The platform is required to keep an updated list of which countries have blocked it due to their own trading laws and regulations. Currently, these are the countries which are legally barred from using eToro:
- The United States
- North Korea
eToro was available in the United States for a time, but it has since been forbidden from fully operating there by the United States SEC (Securities and Exchange Commission). The commission doesn’t allow for the sale of CFD instruments to American citizens. Based on this, eToro has had to rework things in order to comply with U.S. law.
Since then, real trading has been made available to the residents of over 30 states, including:
Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Montana, New Jersey, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Virginia, Washington, Washington D.C., West Virginia, Wisconsin, and Wyoming as well as the Northern Mariana Islands and the United States Minor Outlying Islands. Unfortunately, U.S. residents living outside of the country are not allowed to use eToro in any capacity. As of now, eToro is working towards a long-term plan which will allow U.S. citizens to use it freely, but until then we’ll have to wait for an update.
To enforce these restrictions, eToro requires identity and address verification using phone number verification, a government-issued ID, and proof of your address. Unverified accounts are prohibited from trading and withdrawing funds and may be subject to account closure.
Does eToro Provide a Cryptocurrency Wallet?
Yes, eToro provides a cryptocurrency wallet for anyone using the platform to exchange crypto-assets. You can even purchase cryptocurrency directly to your wallet via Simplex by making a credit card payment. Unfortunately, coins cannot be transferred back from the eToro wallet after they are transferred to it from the eToro trading platform.
Does eToro Support Forex Trading?
Yes. Forex trading is another one of eToro’s trading options aimed at beginners rather than experienced forex traders. The main drawbacks are the lack of customizable features and higher than average withdrawal fees.
What’s eToro’s CopyTrader and CopyPortfolio?
CopyTrader is a popular investor program that allows users to emulate the trading strategies of professional traders. Copy-trading helps them learn more about the industry and develop their own strategy later on.
Copy Portfolio, on the other hand, is a unique portfolio management service that assists traders in the process of diversifying their portfolio and minimizing long-term risks associated with any type of trading.
The Bottom Line
eToro is a unique platform in the world of cryptocurrency exchange. It allows access to a slew of other financial instruments outside of cryptocurrency, which are not supported by many others. While this may make it a weaker platform in the eyes of those only interested in trading cryptocurrency, it is a benefit for an experienced trader who works with stocks and CFDs, ETFs, or forex brokers. Whether or not you choose to use it is mainly a question of what kind of trading you prefer to do.
eToro is recommended for those who want to exchange cryptocurrency but who also wish to handle their flat currency-based financial assets all within the same platform. It’s also an excellent option for those who want to start learning about cryptocurrency trading from the very beginning and get the best investment advice. With access to a high volume of educational resources, a novice can become an expert after a bit of practice.
None the less, the country restrictions are unfortunate. Hopefully, sometime in the near future, eToro will find a solution to serve more American, Canadian, and Japanese customers, among others.
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Disclaimer: Digital currencies and cryptocurrencies are volatile and can involve a lot of risk. Their prices and performance is very unpredictable and past performance is no guarantee of future performance. Consult a financial advisor or obtain your own advice independent of this site before relying and acting on the information provided.