Etoro is a crypto exchange that has a wide variety of cryptocurrencies for its traders. It also offers other services such as stocks and exchange-traded funds through an online brokerage platform. However, unlike the many cryptocurrencies, the stocks and exchange-traded funds offered by the exchange are limited. If you are looking for a communal trading experience, then a review of Etoro is the place for you.
At eToro you will have access to the social features on its platform as well as a fairly active community. The interface allows you to follow and duplicate other traders’ trading strategies. Therefore, it would be a good fit for traders who are just starting out in the cryptocurrency world.
This crypto exchange is also perfect for newcomers because it is straightforward and easy to use. For instance, you can identify the available coins for trading through the news feed on the platform. Besides, the platform also has social feeds and allows a user to chat with other traders.
Hence, you can interact with others and find useful tips and ideas for cryptocurrency trading. However, you might be taken aback by the high trading fees charged by the exchange. So you might want to settle for an exchange with more affordable trading fees.
Advantages of eToro Cryptocurrency Exchange
If there is one truth about trading crypto, it is that every trade includes a risk of losing your money. This means that any trader would rely heavily on review of Etoro before making that bold step to purchase the first crypto through it. Basically, it pays to find an exchange that offers as many benefits as possible. These benefits might save you from losing money in one way or the other. Here are some upsides to using the eToro exchange platform.
1. Ability to Emulate Investment Strategies
Based on review of Etoro and objective look at it, the platform gives traders access to the trading strategies of more experienced traders. On the other hand, it offers various rewards if and when others copy your trading strategy. This means that both inexperienced and experienced traders have something to gain. It allows users to copy as many traders as they want to.
Furthermore, the platform design makes it easy to do this. With just a simple click of a button, you can allocate the money you want to trade based on your preferred trading strategy. In turn, the system automatically distributes the money accordingly to mirror the strategies of your copied trade. What’s more, they don’t charge any management fees thus no extra charges involved.
2. Offers Variety in the Form of Stocks, ETFs, and Crypto
Exchanges that allow traders to trade both stock and crypto at the same time are rare. This is what makes eToro very unique since it has a wide variety of cryptocurrency and stocks trading options for users.
Users can purchase fractional shares from the eToro platform while also trading stocks without paying any commission. Amateur traders might find the eToro useful since it offers a virtual brokerage account. So, you can test your trading skills accordingly before risking your money.
3. Offers Free Debit Card Deposits
It’s normal for crypto exchanges to charge a certain fee when you deposit through a debit card. However, at eToro, you get to do it for free for traditional currencies. You should note that it charges a conversion fee for non-U.S. dollar transactions.
Disadvantages of eToro Cryptocurrency Exchange
Despite all the advantages that come with using this exchange, it also has some disadvantages as revealed by practical users’ review of Etoro. So, it’s up to you as a trader to weigh both sides of the coin before settling on this crypto exchange. For some, the benefits might outweigh the disadvantages while to others it might not. Here are some of the main disadvantages of using this exchange platform.
1. Limited Selection of Cryptocurrencies
The main disadvantage of eToro is that it has a more limited selection of cryptocurrencies unlike some of the best cryptocurrency exchanges. For instance, as a U.S investor you only have access to approximately 25 distinct cryptos. As a non-U.S. investor on the other hand, you can access almost 75 cryptocurrencies.
This can be fairly disappointing especially if you have used other platforms that offer hundreds of cryptocurrencies. However, this can be overshadowed by the fact that it allows traders to manage all their assets in one place.
2. High Cryptocurrency Transaction Fees at Etoro Crypto Exchange
The availability of many cryptocurrency exchanges in the market should give one access to the most competitive fees. However, this has not always been the case as you can see from eToro’s case. For instance, it charges a 1% fee plus a spread for cryptocurrency transactions.
While this rate might be lower than other exchanges, it still does not meet the expected competitive rate. It could also be discouraging since you can find competitors who charge 0.1% or less.
Traders planning to purchase a lot of digital currencies can only make a little profit by eToro’s transaction fees. Furthermore, the exchange charges an inactivity fee if an account has been inactive for a year. So, this is probably not the place to go if you’re a buy-and-hold investor.
3. Locational Limitations
eToro exchange is not the best trading platform if you are from certain parts. For instance, people from certain U.S states cannot trade on the platform. These include Hawaii, Minnesota, Nevada, and New York. However, the exchange is looking to improve its availability in the country.