eToro

The trading exchange is very simple and easy to navigate with relatively few features or bells and whistles. 

• Each transaction remains whole, meaning if you buy $25 in BTC, when you sell it you must sell all of the $25 and not a portion.
• For those outside the US, they can view other asset classes, including stocks, currency pairs and 20+ contracts for difference (CFDs).
• Watchlists area is available and can be set up to receive price notifications on your mobile app.
• Non-US users can set a buy rate, stop loss and take profit upon opening the position.
• US users can place a stop-limit order once a position is open but not during entry.

All users, regardless of whether they are copy trading others, can view each trader’s performance statistics on the platform (unless a trader sets their profile to private), adding a crowdsourcing feature to trading.

US users only have access to market orders with no leverage.

Non-US retail users (Europe, UK) may leverage up to 5x on stock trades while professional clients of eToro in Australia can leverage up to 10x on stock trades and up to 20x on selected stocks. Positions that are traded with leverage are traded as CFDs; you are holding a position without ownership of the stock and without any shareholder rights.

The minimum copy trading amount is $200 per trade, which users can apply to the professional traders they wish to follow. Maximum amount is $500,000 and users can choose to follow up to 100 traders at once. The copy trading mechanism for non-US users is well developed while US residents have very limited copy trading choices at the time of writing.

There are relatively few crypto ‘experts’ to choose from in comparison to the stock traders available for copying. For stocks (not available in the US), many of the traders have been building a reputation for years on eToro. Users may access the traders’ returns stats, portfolio allocation, risk score, and an estimate of how much they’d earn over a year if you were copying this particular trader.

To help attract experienced traders, eToro has created their Popular Investor Program; see below for the parameters for joining:

• Users must hold $100 or more in equity
• They need at least one copier
• Their risk score must be below 7
• They must have a fully verified profile

To attract newcomers to the space who want to copy the traders of others (and provide a market for professional traders), eToro offers a free demo account for new traders to get the hang of trading with zero risk. It’s available for both stock and crypto trading.

All CopyPortfolios are overseen by eToro’s investment team and can also be copied by traders to help minimize long-term risk and gain opportunities for portfolio growth. Each portfolio uses a different methodology and is rebalanced regularly. There are two options:

1. Top Trader Portfolios that include the top performing traders on the eToro platform
2. Market Portfolios, which create bundles of CFD stocks, commodities or ETFs within one particular market strategy. 

For those traders who are interested in learning more about copy trading, or “social trading” as it’s sometimes called, there’s a video series available by Social Trading Vlog, which focuses solely on copy trading at eToro.

In the watchlists area, you can select assets you are considering making trades on and set a price alert. For instance, if you want to place a market buy for Ethereum when it hits $1300, you can easily set that up.

By clicking on the charts next to the real time prices, traders are led to eToro’s ProCharts, which enable customization for:

• Design themes
• Comparisons
• Time frames from 1 minute to 1 week
• A full set of tools including oscillators, fibonacci, ellipses, lines and segments, etc. 
• Chart choices including candle, bar, and line, etc. 

Compared with many crypto exchanges, such as Kraken and Gemini, eToro’s educational resources are slim. When signed on as a US user there are virtually no informational resources in the dashboard. The focus is more on providing trader statistics which are available to all users (unless a trader sets their profile to private). 

The main website has an Education Page that covers general topics such as “What is Cryptocurrency” and “How to Buy Bitcoin” and leads you to video and text tutorials on trading topics. You must subscribe to receive the tutorials which come in segments, which is suboptimal to those who want to take in the information at their own pace. Additionally, there is zero information about using, storing, and securing cryptocurrencies. Users must be logged off of eToro to access the minimal educational resources located on the website.

US users will need to complete a W9 to submit their Tax I.D. information for eToro’s reporting requirements. They deliver 1099-K tax forms when a user meets both of the following conditions: 

• Cryptocurrency for USD sales on eToro exceed 200 transactions during the calendar year.
• Total sales proceeds from all sales of cryptocurrency for USD exceed $20,000 during the calendar year. 

Different states in the US have different reporting requirements.

When eToro first opened to crypto trading, they instituted a $5.00 withdrawal fee for crypto assets, which was later cancelled for US residents (but still holds for non-US users).

• US users pay between 0.75% and 5.00% depending on which cryptocurrency. 
• Account minimum is $50.00
• Spreads for trading cryptocurrencies are relatively wide, see the breakdown below:

• US users can open an account for $50.00 and the minimum order is $25.00 when buying any cryptocurrency.  
• New account owners will have a 1-4 day wait during the identity verification process.
• EToro uses Plaid for setting up connections to bank accounts in the US, with PayPal and other funding sources available to non-US users. 
• Users can deposit (or withdraw) using ACH bank transfers or a wire.

• There’s no withdrawal fee for crypto (blockchain network fees may be applicable).
• Minimum withdrawal amount is $30 (this is quite high compared with other US exchanges)
• Crypto to crypto conversions are charged a 0.1% fee (during beta stage only).
• Withdrawals to external crypto wallets must be done through the app.
• Here are the send transaction limits which come into play

As eToro is compliant with AML and KYC, all users must go through a complete verification process. There are no options for limited trading with lower verification levels as you see on exchanges like Binance and Gemini. To verify, you’ll need to provide your email, address, DOB, social security number, proof of identity, and proof of address. The process takes several days and users will receive a notification letting them know when verification is complete. 

What are AML and KYC?

As part of a range of Anti Money Laundering regulations mandated nationally and internationally, KYC involves the requirement of companies to verify each customer’s identity during the onboarding process. Verification is achieved by submitted identification, proof of ownership, and personal information such as name, address, email address, phone number and tax I.D. number.

The eToroX platform offers familiar features that you’d see in stock trading, such as transaction fees in basis points and open/high/low/close data (which is interesting considering cryptos run in 24/7 markets). Something that is unique to this platform (in the crypto world) is the use of an inverted maker/taker fee structure. It’s a taker/maker structure so the takers get the lower fees, which is opposite of crypto exchanges. 

EToroX provides near instant bank transfers using Signet and sets a daily limit of $10,000 in withdrawals, unless otherwise requested and approved. There are no fees for deposits but the minimum deposit is $10,000 (it’s $50 on regular eToro and other US exchanges).

While phone support is only available in Australia, eToro does offer online chat through the customer service page, which also offers plentiful resources on how to use eToro. There’s also the option to put through a support ticket. 

EToro has over 1500 reviews in the App Store averaging 4.1 stars. In Google Play they have over 50,000 reviews averaging 4.3 starts. 

The negative reviews are largely centered on several topics:

• 30+ day waits for ticket responses
• Trade got stuck which resulted in loss
• “Too much automation and not enough real support.”
• Many bugs that need to be worked out.

Several “Club” levels are available to users with large portfolios. These users also enjoy enhanced customer service, a dedicated account manager, and advanced tools.

eToro has a longstanding reputation as a brokerage that creates a market for new traders that feeds to experienced traders so they can earn by sharing their expertise. Their entrance into US availability and crypto markets is relatively new, in beta stage and lacking many of the features that US crypto exchanges like Coinbase, Kraken, and Gemini offer. The social trading element seems to be a viable business model, creating a way to bring in new traders and a vehicle for attracting top performing traders. 

• EToro is transparent about fees, which are clearly outlined. 
• Their algorithm for calculating trader scores is transparently displayed under each trader profile. 
• They do provide a status page for information on downages. 
• Etoro only mentions in passing that it uses cold storage for most platform crypto assets, but there is no mention of who the custodian is or even if there is one (unless you are an institutional customer).

In July 2020, a pseudonymous hacker using the alias “Sheriff” was discovered to be auctioning off the data of 62,000 eToro users. Information at jeopardy including login credentials, phone numbers, postal addresses and balances. The starting auction bid price was $1500 with higher bids in $500 increments and the data going to the top bidder. A research company, Bank Security, posted an alert on the eToro Twitter account but eToro allegedly made no public response regarding the hack.

• Dollar cost averaging/recurring buys
• TradingView chart integration
• Self custody
• Automated trading – limited, scalping is prohibited
• Leverage
• Futures
• USDT or other stablecoin trading
• Staking
• Desktop withdrawals of crypto to external wallets (only enabled via their app)