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eToro Exchange Review
eToro is unique in the cryptocurrency exchange space, as it has been around since before the Bitcoin network was launched. This trading platform was originally for trading traditional assets, but more recently, eToro has entered the cryptocurrency space. The site has more than six million users. eToro offers many trading features that beginners can benefit from, and to top it off, the entire interface experience is extremely friendly and welcoming to first-time crypto traders.
By: Kyle Torpey | May 21, 2020 | Modified May 25, 2020
Etoro
- Great for crypto beginners
- Solid crypto/general trading platform
- Reliable company with solid trust in the community
- Fully supports credit cards for deposits and withdrawals
General Overview
- Traders receive access to traditional markets
- Social trading feature enables tracking of other users’ trades
- Copy trading features enables users to follow and copy the action of other users’ trades
- Easy for new cryptocurrency traders to understand
- One of the most trusted options on the market
- Cannot take custody of your own coins when trading on eToro, these are derivatives
- Large number of different fees to look out for on this platform
- Americans do not have as many trading options as traders from other parts of the world
- The number of cryptocurrencies available for trade is somewhat limited
- CFDs come with additional risks that may not be suitable for new traders
eToro at a Glance
| Volume | Unavailable |
| Trust Rating | High |
| Fees | High |
| Withdrawal Limit | $200,000 for cryptocurrencies |
| Overall Rating | Medium |
| Users | 6+ Million |
eToro Funding Methods
| Method | Deposit | Withdraw | Speed |
|---|---|---|---|
| Bank Account (ACH) | No | No | n/a |
| Credit Card | Yes | Yes | Instant |
| Debit Card | Yes | Yes | Instant |
| Wire Transfer | Yes | Yes | 4-7 Days |
Sign-up Process
eToro has a rather simple, straightforward sign-up process, although personal information will need to be verified before a user can start trading. To open a new account on eToro, follow these steps:
- Go to the eToro homepage and click on the “Join Now” or “Trade Now” button to get started.
- You will need to enter your personal data on the next page, including your first name, last name, email address, username, password, and phone number. You also have the option to create an account via your Facebook or Google account.
- Before submitting all of your information, take a look at the eToro Terms and Conditions and various policies that you are agreeing to. You must indicate that you’ve read and agree to these terms before signing up for an account.
- Once you submit your basic information, you will need to go through the Know Your Customer (KYC) application, which is used to verify your identity and limit money laundering on the platform. For this part of the account creation process, you will need to provide a valid bill or document that proves your residence and your passport or some other government-issued identification. The KYC process also involves a questionnaire that must be filled out in order for eToro to better learn how they can best serve you.
What You Can Buy
While eToro does not offer a wide variety of cryptocurrencies for trade, most of the biggest names in the cryptocurrency market can be found on this platform. These include:
- Bitcoin
- Ethereum
- Bitcoin Cash
- Ripple
- Dash
- Litecoin
- Ethereum Classic
- Cardano
- IOTA
- Stellar
- EOS
- NEO
- Tron
- Zcash
- Tezos
eToro Supported Applications
Users of eToro are able to interact with the platform via mobile or desktop devices. The trading platform can be accessed via a web browser, and there are also applications available for Android and iOS.
In addition to the eToro trading app, there is also the eToro Wallet, which can be used by traders to gain more functionality with their assets. However, it should be noted that this feature is not available for all crypto assets and it is still a custodial wallet.
Is eToro Safe?
eToro is one of the safest companies in the cryptocurrency space thanks to its compliance with CySEC, FCA and ASIC regulations. All customer funds are held in secure banks and personal information is guarded under SSL encryption. It’s very unlikely you’d lose money on eToro.
On the other hand eToro is one of the only cryptocurrency exchanges where you don’t actually own your cryptocurrency, they are just derivatives, which definitely frustrates some crypto enthusiasts.
Fees
The fees charged to eToro users can be difficult to fully understand. There are a variety of different fees associated with the platform, and different cryptocurrencies come with different fees when making trades.
While there are no fees on deposits, there is a flat $5 fee added to every withdrawal. The minimum withdrawal amount is $30. There are also fees added to deposits and withdrawals if a currency conversion must be made to process the payment. Additionally, eToro charges flat fees for cryptocurrencies that are withdrawn to the eToro Wallet.
The fees charged on your cryptocurrency trading will depend on which crypto assets you are buying and selling. Bitcoin has the lowest fees at 0.75%, but these fees can go as high as 4.5% for smaller altcoins. In addition to the base trading fee, there will also be an overnight fee added to CFD positions.
Finally, it should be noted that eToro charges a $10 monthly inactivity fee for accounts that have not been logged into for 12 months.
eToro Frequently Asked Questions
eToro enables a special type of trading instrument, known as Contracts For Difference (CFD). This is a special type of derivative trading that allows users to bet on the movements of cryptocurrencies with additional leverage. Instead of buying the underlying asset, CFDs allow users to place a bet based on a price feed.
Users should make sure they understand the risks involved with CFD trading before they get started. When trading on margin, traders can be completely wiped out rather quickly.
Originally, all cryptocurrency trading pairs were actually CFDs, but the platform now offers actual cryptocurrency trading as well.
It should be noted that CFD trading is not available for Americans.
There are two interesting ways in which eToro users can basically put their accounts on autopilot and allow other users to make all of the difficult decisions. These two options are CopyPortfolios and CopyTrading.
CopyPortfolios allow users to gain access to a particular basket of assets or a predetermined trading strategy via a single feed. For example, users can create their own portfolio of crypto assets based on the coins they feel will perform the best over the next year. Other users can then see these portfolios and decide to buy into one of the other users’ particular strategies.
CopyTrading works just like it sounds. Users are able to automatically copy other users’ trading decisions. This is part of eToro’s use as a social platform where users can follow the most profitable traders and try to profit from simply following their advice rather than picking out individual cryptocurrency trading strategies.
eToro Wallet is part of the platform’s major push into the cryptocurrency space. With this application, users can transfer crypto assets from the trading platform into their own wallet, send those assets to other wallets, receive cryptocurrency payments, and convert between different crypto assets within the wallet.
This wallet software is currently available for Android and iOS devices; however, it is not able to be used by users in every country.
eToro Wallet is a custodial storage solution, which means that eToro holds the crypto assets on behalf of its users. In this way, eToro Wallet users are not actually using a cryptocurrency network. Instead, they are basically holding cryptocurrency IOUs issued by eToro.
The functionality of this wallet is extremely limited compared to other options on the market. For example, users are currently unable to send crypto assets from their eToro Wallet to the eToro trading platform. In other words, users will have to send their coins to another exchange if they wish to sell.
On the bright side, the eToro Wallet supports many more crypto assets than what is found on their trading platform.
eToro uses a variety of factors to determine their top traders. Obviously, the traders who are able to gain the most profits will find themselves highly ranked. However, it should be noted that traders that aren’t actually trading much volume can still be ranked highly due to seeing big percentage gains on their original investments.
Factors such as the number of positions taken per day or week, the duration of positions, and the amount of leverage placed on trades also play a role in this process.
Traders who become popular on eToro’s platform and gain a lot of followers are able to earn additional income. These traders are paid once per month based on their Popular Investor level. This level is determined by the number of users who are following the trader and the amount of money those users are placing in trades that copy the popular investor’s decisions.
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