American investors can now trade cryptos without any prior knowledge of the market thanks to eToro USA. Active in the UK and Europe for more than a decade, eToro Exchange is a social trading platform that allows novice traders to stand on the shoulders of experienced investors.
Now live in 32 states, eToro USA currently offers markets for 13 cryptos, including Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Ripple (XRP). As the platform grows, more cryptos will be added to the mix. On top of that, traders can also test out the new eToroX Exchange for additional investment options.
Buying Bitcoin et al Using eToro USA
To show you how eToro USA differs from other exchanges available in the region, here are the important pros and cons.
eToro USA Pros
Simple Social Trading: The reason eToro Exchange appeals to novices is its ‘follow’ feature. Much like Twitter or Instagram, you can follow experienced investors and the site’s software will mimic their trades at a price point you select. This feature basically allows anyone to start trading cryptos without any prior knowledge.
Safe and Secure: Even though the top online crypto exchanges have become more secure, none of them are currently regulated in the same way as eToro. Being a financial trading platform that deals in multiple assets (not just cryptos), this company has to be licensed by multiple financial authorities. These regulations keep eToro, its financial liquidity, and processes such as ID verification in check at all times.
Accessible and Convenient Interface: As well as payment options such as PayPal and Visa, eToro USA has been refined over the last decade. This makes it stable, efficient and easy to understand. In contrast, Paxful Exchange has only been around since 2015. For developers to perfect their product in that amount of time is tough, which is why eToro wins in terms of accessibility and convenience.
Next Generation Trading: eToro USA is also behind a blockchain-based venture known as eToroX. A new type of exchange that offers crypto assets secured against stable coins, eToroX is next generation trading for advanced users.
Simple Wallet Solution: If you’re an eToro Gold member or higher, you can access a blockchain-based crypto wallet. Capable of holding multiple coins, including BTC, ETH and LTC, this wallet allows you to move tokens to and from your eToro USA account with ease. What’s more, when you download the iOS or Android app, you’ll receive a personal blockchain address (through the eToroX platform). This allows you to make on-chain transfers and store you private keys on the blockchain.
eToro USA Cons
Fewer Coins: If you look at top-rated crypto exchanges such as Kraken, you’ll see that it lists more than 50 digital tokens. At present, eToro USA only has 13 cryptos to invest in. Although that list will grow, it will be a while before it catches up with traditional crypto exchanges.
A Difference in Deposits: Scroll through our list of places to buy Bitcoin and you’ll see that Coinmama, CEX, and Binance all have minimum deposits of $1. In contrast, eToro US asks you to deposit at least $500.
Higher Fees than Exchanges: Although fees will vary from site-to-site, you’ll typically pay around 0.1% each time you buy or sell digital tokens via an exchange. At present, eToro Exchange charges you $25 each time you make a withdrawal. Additionally, trading fees (spreads) are as high as 2.9%. This means novice traders may have to invest slightly more than they’re used to in order to make their time online worthwhile.
Local Restrictions: Because of regulatory issues in the US, eToro Exchange USA can’t offer contracts for difference (CFD) trading. This type of trading is available inside eToro’s international sites and provides a flexible way to speculate on price increases as well as decreases. At this stage, eToro USA only allows you to buy the underlying assets and not CFDs.
Market Experience: Although eToro Exchange has been active in Europe for years, it’s a newbie in the US. Because each country has its subtle differences in terms of consumer preferences, the operator may experience certain teething troubles as it adjusts to life in the USA.
Featured image: Grey82/Shutterstock.com