Everything You Need to Know 【Most Updated 2022】
Quick Glance at the eToro Platform
Cryptocurrency traders who are interested in the prospect of copy trading are those whom eToro is best suited for. You can start trading with only $50 or $200, depending on your location. The fact that you can actively or passively use the information available on other trader activities is a plus. Of course, you do bear the risks that are involved, even if you don’t know what they are.
- The customer service offering provides excellent support.
- Free cryptocurrency wallet for storage
- There are a host of cryptocurrency alternatives available for your trading needs.
- You are not entirely left in the dark since you can use social trading to match successful traders move by move.
- A user-friendly mobile platform that makes the trading workflow seamless.
- Depending on your country, you may not be able to trade in some asset types.
- The amount of information the platform offers on using it is quite limited.
- Withdrawal fees and spreads are not the most favorable.
Founded in 2007 as RetailFX in Tel Aviv, eToro began its journey to becoming the platform it is today. David Ring, along with the brothers Ronen Assia and Yoni Assia, were responsible for eToro’s inception. Today, eToro has amassed millions of users across over 130 countries.
Most investment platforms demonstrate an area of innovation that they become known for, and eToro is no different. It made a name for itself through an ingenious social investing mechanism. In the world of investments, some people do well, thanks to knowledge and expertise. Some people, on the other hand, wish they had the intuition to make the same moves as the more proficient investors.
This need is where eToro’s social investing comes into the mix, as it allows users to copy trades made by other investors. Suddenly, the knowledge gap that drives investment decisions no longer seems as broad as it did before.
While eToro is registered in Cyprus, it has a cross-border license that allows it to operate in other European countries. Additionally, it happens to be a regulated Financial Conduct Authority in the United Kingdom.
Important eToro Features
As stated before, eToro offers the convenience of social trading. This functionality uses its CopyTrader. Thanks to a well-designed algorithm, your account can copy and make automatic trades, based on whatever moves selected users make. The workflow that allows you to do this is straightforward since you only need to choose an investor that you want a mirror and click a button.
Once you opt-in, the mirroring process begins to take effect immediately. Of course, while you do stand to gain from this process, you also stand to lose, since even the top investors don’t always make the right decisions. Thankfully, there is a stop-loss level built-in that helps you to mitigate potential losses.
$200 is the minimum amount for user copying, while $500,000 is the maximum. You’re not very limited either since you can copy as many as 100 traders at the same time.
If you want to see the moves that other traders are making without copying them, this is also possible. As an eToro user, you’re allowed to view risk levels, statistics, and portfolios that belong to other traders. You can then use this information in whatever way you see fit.
Free Digital Wallet
eToro wallet is a free digital wallet for your cryptocurrency storage. You can manage the application on both Android and iOS operating systems. While this is a very convenient offering, remember that web and mobile wallets are not as secure as other options, such as hardware wallets.
If you take up the offer, bear in mind that there is a 5% conversion fee to convert your cryptocurrency to a flat, usable money-based alternative. Depending on your unique situation, this may not be a problem at all, or it could be a big blow to any chance you have of making a substantial profit. Note also that the minimum transaction amount is $125, while the maximum transaction amount is $10,000.
Variety is an essential part of any investment platform. This feeds into the concept of portfolio diversification, which allows you to remain in a favorable position even if one or more of your investments are not doing very well. eToro offers a well-balanced selection of cryptocurrency alternatives, which are:
- Binance Coin
- Bitcoin Cash
- Ethereum Classic
Contract for Difference trading goes hand in hand with cryptocurrency on eToro. This is a derivative trading method in which investors make predictions on the potential for the rise or fall of global financial markets. This can be done using commodities, flat currencies, treasuries, shares, or cryptocurrencies.
Note that you do not purchase or sell the underlying asset. So, if you are using cryptocurrency, you buy units of the CFD instrument, which depend on Your prediction.
If your prediction is correct, then you get some multiple of CFD units that you purchased or sold. If you are incorrect, then you lose a multiple based on the number of points against you that the movement goes.
Since there is a formula of multiples applied here, you need to be extremely careful, since you stand to lose a more considerable amount than you deposit.
Payment Method Alternatives
Note that you must verify your identification and residence digitally before eToro allows you to use deposited funds. Additionally, even though $50 is the minimum permitted withdrawal, there is a flat withdrawal fee of $25. Therefore, smaller withdrawals may not be very beneficial. The funding methods that you can use are as follows:
- Debit or credit card – One critical point to note here is that you can only use a card that is registered to the name of the verified person on the eToro profile. There is no clearance time for deposits, which makes this an appropriate method if you are looking for something instantaneous.
Unfortunately, withdrawals don’t work at a similar speed. It can take one to four days to receive your funds, and this depends on the bank that you use, and the process involved in making money available.
- Electronic wallet – Your eToro wallet can also be a source of funding and withdrawal. You need a third-party service, such as PayPal or Webmoney, to achieve this. The timelines are like those associated with the debit or credit card method.
- Bank transfer – The wire or bank transfer method of funding your account is also acceptable. However, as opposed to an instant deposit, you are looking at a process that can run for as much as five days. Withdrawals, on the other hand, can take anywhere from five to nine days to be completed.
Where Does eToro Operate?
eToro operates in many countries around the world, and there are plans to increase that number and to offer more services in each country. The United States, for example, is not allowed to engage in CFD trading. Additionally, the eToro platform can only be used in 41 of the 50 states. Below is a list of all the countries in which the service can be used:
- Antigua and Barbuda
- Bosnia and Herzegovina
- Burkina Faso
- Côte d’Ivoire
- Cabo Verde
- Central African Republic
- Costa Rica
- Czechia (Czech Republic)
- Dominican Republic
- El Salvador
- Equatorial Guinea
- Eswatini (fmr. “Swaziland”)
- Holy See
- Marshall Islands
- New Zealand
- Palestine State
- Papua New Guinea
- Saint Kitts and Nevis
- Saint Lucia
- Saint Vincent and
- the Grenadines
- San Marino
- Sao Tome and Principe
- Saudi Arabia
- Sierra Leone
- Solomon Islands
- South Africa
- South Korea
- South Sudan
- United Arab Emirates
- United Kingdom
- United States
Setting Up Your eToro Account
If you decide that you want to create an eToro account, all you need to do is follow these steps:
- Go to the eToro website and click the “Join Now” button to get started.
- On the “Create an Account” page, you are given three options. You can set up a dedicated eToro account by signing up with a username, email address, and password. Alternatively, you could sign up with either your Facebook or your Google account.
- Once this process is complete, you now have a basic or demo account. While you can log into it, you cannot yet do any trading. Note that you receive an email at this point that advises you on the next steps that you need to take.
- When you are ready to start trading, you need to convert your account to a live one. Doing so requires going through the verification process that is described below.
- Once your account is verified, make the minimum deposit depending on your country’s requirements, and you are free to get your trading underway.
eToro Verification Considerations
While you don’t need to take any additional steps to maintain an eToro account, you must go through the stipulated verification procedure before you can begin any trading. There’s no point in having the account if you don’t plan to use it to trade, so be prepared to run through this process.
It boils down to providing required documentation, which confirms that you are who you say you are. There is no need to panic, as only two such documents and a picture are required.
Proof of Address
This document serves to validate the location that you have provided. Whatever document you use should display your full name, your address, and the date that it was issued. The date is significant, as no document that is older than six months is accepted. Either the name of the issuing authority or a logo must be visible for the document to be acceptable. A utility bill is an example of an acceptable address verification Document.
Proof of Identity
eToro requires proof of your identity to confirm that you are who you say you are. Your submission is meant to associate your photo with your personal information. To this end, whatever identification method you use should display a photograph, your full name, your date of birth, the issue date, and the expiry date.
Any government-issued ID, such as a driver’s license or a passport is acceptable, once the required information is displayed.
Proof of Identity and Selfie
This submission is one of eToro’s later verification requirements. For even further confirmation, account creators are required to take a selfie in which they are holding whatever proof of identity document was submitted.
eToro has developed a tremendous reputation as a cryptocurrency trading platform that fosters CFD trades. Of course, there are other asset types, but the crypto community seems to be the stand-out investment option.
There aren’t many barriers to entry, and you don’t necessarily need to start as a rookie. This is because of eToro’s famous social trading system that allows you to mimic any trades that are made by experts. Of course, you do take on any risks that are associated with doing so.
The platform can be accessed through both mobile and web interfaces with no loss in functionality.
Apart from its unique algorithm, eToro also scores major points for its incredible country presence and top-notch customer support. Deposits and withdrawals are doable in three different ways, and they are generally quick enough. It also helps not to need to worry about the security of your funds.