Crypto isn’t just the next hottest trend, but likely the future of all digital transactions. While cryptocurrencies like Bitcoin and Ethereum have taken over media headlines the last few years, an increasing number of cryptocurrencies are entering the market with a wide range of use cases offering institutional and retail investors plenty of opportunities to break into the space. Whether you’re looking to buy your first cryptocurrencies or are a seasoned crypto investor already, it’s important to understand the tools and modes of buying cryptocurrencies, especially since the landscape is constantly changing. One of our favorite platforms to track and buy cryptocurrencies is eToro. This market leader is incredibly powerful, simple to use, and a popular tool for many crypto enthusiasts. Let us break down why eToro should be your go-to platform and how to use it.
Investment with eToro
Everything you need to know about eToro
The eToro platform describes itself as a social trading platform. Operating in over 140 countries with over 20 million users, eToro is a leader in cryptocurrency investing. While its main draw is cryptocurrency investing, eToro also allows users to invest in stocks, ETFs, and CFDs with 0% commission. With phone and desktop applications, eToro offers users versatility for on-the-go trading and more complex features when using a computer. As a digital trading platform, eToro also prides itself on its security and privacy features. eToro is regulated by the FCA and CySec, has advanced industry-leading protocols like two-factor authentication and quality customer service, and promises users to never share private data without your permission. Further, for the user’s convenience, eToro works with Visa, Mastercard, PayPal, and several other financial institutions to make transferring funds accessible for all.
Getting set up with eToro is incredibly easy, especially since you can use your smartphone to do it. You can use your Facebook or Gmail account or create a unique login. After you set your password up, you should be logged in ready to go. Because crypto scams and other cyber attacks are increasingly common, we suggest that you set up security measures such as two-factor authentication. Once you get your profile set up, you’re good to go. While you need to deposit at least $10USD to start trading stocks and $25 for cryptocurrencies, a vast majority of features are available to you immediately. This is a great way to get a feel for the platform at no cost to you, whereas this feature is not common amongst other platforms.
Now that you have an account, you can start leveraging eToro to make you a smarter investor, even if you don’t put money into your account. Once logged in, you are greeted with a vast array of features to help you get started on your investment journey. To start eToro’s dashboard provides live feeds of all the major international markets, including the biggest gainers and losers of the day for both stocks, cryptocurrencies, and other investments.
In the dashboard, you will find a News Feed that is a hub for other eToro users to share topics, discuss recent trades, or post about investing strategies. In the News Feed, eToro also has a trending section so users can explore what investments are popular amongst its users. We love this section because it allows users to post their own analyses, graphs, and strategies and get real feedback from the community. This part of eToro is what makes it a valuable tool and truly a social investing platform.
Further, regardless of your investing level, eToro’s Discover tab gives you the power to explore stocks and cryptocurrencies in an exciting way. eToro conveniently displays which assets are trending for its users as well as breaking down these investments into their classes, such as stocks, cryptos, and ETFs. Here, you can also explore eToro’s CopyTraders. These traders are real people who publish their investment strategies and show their returns. These traders act like investment influencers where you can see live updates on their thoughts, statistics on their trades, their portfolio of current assets, and customized charts.
Other features on eToro include a watchlist and portfolio tabs that give the user ample opportunity to customize their investing experience. Within the watchlist tab, you can make dozens of custom watchlists to track different types of investments. Further, in the portfolio tab, eToro gives you an easy-to-read breakdown of all your investments. While these features are standard in other platforms, eToro adds value by providing live price updates within these views, advanced filtering options, and P&L calculations such as Start Value, Open Time, and Net Cashflows.
You’ll notice that once you start adding to your watchlist and following CopyTraders, you will have a personalized feed under your portfolio. With the social media-like design, eToro truly is the at top of its class at providing an easy-to-understand platform that delivers you investment content in an intelligent and meaningful way.
One thing we love about eToro is that signing up for the platform is free. eToro takes 0% commission on stock trades and has no brokerage fees. To start using the platform for stock trading there is a $10 USD minimum that must be deposited, however, you can still use the platform to track stocks and get all the basic functionalities listed above.
The story is slightly different for cryptocurrency trading. One way eToro is able to make money is by collecting fees on cryptocurrency transactions. While the fees are small, ranging from 0.75% to 5%, they are somewhat typical amongst cryptocurrency trading platforms. Part of the explanation for this is that because cryptocurrency prices are so volatile, the only way to ensure these platforms don’t lose money is to buy these currencies in bulk and sell them back to the user. This price difference is known as the “spread” and is why the fee percentage can change.
There are some other costs as well. For non-U.S. residents, eToro has a withdrawal fee of $5 but is eliminated once you become a Platinum level investor (described below). For U.S. residents there is only a $30 minimum for withdrawal transactions. Further for non-U.S. residents, there will be a conversion fee from your local currency, that can vary. Additionally, if you plan to change your crypto holdings to another wallet or platform, there is a fee that is incurred for this.