eToro Review

In this review, we take a deep dive into the products and features offered by eToro and explore specifically which features are available in New Zealand.

Know this first: The scope of products eToro offers in New Zealand is severely limited compared to the rest of the world.
 
eToro summary:

• eToro is a multinational online trading broker with licenses from multiple regulators.
• eToro is not licensed to operate as a derivatives issuer, nor is the broker registered with the FSPR.
• On the 30th of September 2018, eToro discontinued support of CFD and securities trading for New Zealand residents.
• Currently, the only service eToro provides to New Zealand residents is cryptocurrency trading.
• eToro operates a standalone cryptocurrency exchange and wallet called eToroX.
• The company is backed by major investors and recently announced a public offering.

 
To explain eToro in detail, our guide covers:

• Introduction to eToro
  
• eToro Product and Services
  
• Alternatives to eToro - Easy Crypto vs BitPrime vs Binance vs LocalBitcoins
  
• Frequently Asked Questions
  

Warning:

1. By publishing this guide, we are not recommending or suggesting in any way or form that Bitcoin or any other cryptocurrency is a suitable investment.
2. We published and update this guide to help people understand the eToro platform - MoneyHub is conservative, and our publisher, Christopher Walsh, has zero Bitcoin or other cryptocurrency investments.
3. We present this information in good faith and remain objective at all times. ​By including this guide under our Investing and Saving section, we are not advocating that cryptocurrency is an investment. We may earn a referral bonus for anyone that clicks on some of the below links - see our Advertising Policy for more details.​​

eToro is a popular name in the online trading community with more than 20 million registered users. The company operates worldwide with numerous licenses to offer various investment and speculative trading products, such as forex, contracts-for-difference, stocks and cryptocurrencies.
 
The company was founded in Israel in 2007 by three fintech entrepreneurs with the vision of making the global financial markets accessible, simple and transparent for everyone.
 
eToro has built a large community around its copy trading platform where experienced traders can host detailed strategy profiles for prospective investors to evaluate before copying in their accounts. Copying other traders with a verifiable track record is attractive to many retail investors who don’t have the time or skills to trade themselves.

​eToro has several licenses and registrations for providing financial services around the world. At present, eToro does not have a license to provide financial services in New Zealand, nor is the company registered on the Financial Services Provider Register.
 
In 2010, eToro gained its first license to provide investment services. The brand received an Investment Firm license from the Cyprus Securities Exchange Commission (CySEC) (license no.109/10). A few years later, eToro became authorised and regulated by the Financial Conduct Authority (FCA) in the UK (firm ref no. 583263). Subsequently, eToro became authorised by the Australian Securities and Investments Commission (ASIC) and licenced by the Financial Services Authority Seychelles (FSAS).
 
As eToro began expanding into the United States, the brokerage registered with FinCEN as a Money Services Business and became a member of the Financial Industry Regulatory Authority (FINRA) and Securities Investor Protection Corporation (SIPC).
 
eToroX, the standalone cryptocurrency exchange offered by eToro, is a regulated distributed ledger technology (DLT) provider licensed by the Gibraltar Financial Services Commission, with licence number FSC1333B.

Internationally, eToro offers a wide range of trading instruments and features. In New Zealand, the only service offered is cryptocurrency trading.​

eToro offers cryptocurrency trading on its flagship multi-asset social trading platform, a dedicated crypto exchange called eToroX and a cryptocurrency wallet.
 
On the eToro platform, all New Zealand can do is open and close long (buy) positions without leverage. Instead of closing the position, you can choose physical settlement in cryptocurrency, which is transferred to your eToro wallet; this operation incurs a fee of the greater of 0.5% or US$1. Therefore, you can buy and trade cryptocurrency on the platform.

eToro does not charge commissions for trading cryptocurrencies but does charge a spread. The spread starts at 0.75% for trading Bitcoin and varies according to the product. The highest spread is 5% on Tezos.

​eToro supports 30 cryptocurrencies on its trading platform, all of which can be withdrawn to the eToroX wallet. Supported cryptocurrencies are:
 
Bitcoin (BTC/USD), Ethereum (ETH/USD), Bitcoin Cash (BCH/USD), XRP (XRP/USD)
Dash (DASH/USD), Litecoin (LTC/USD), Ethereum Classic (ETC/USD), Cardano (ADA/USD), MIOTA (IOTA/USD), Stellar (XLM/USD), EOS (EOS/USD), NEO (NEO/USD), TRON (TRX/USD), ZCASH (ZEC/USD), Binance Coin (BNB/USD), Tezos (XTZ/USD), Maker (MKR/USD), Compound (COMP/USD), Chainlink (LINK/USD), Uniswap (UNI/USD), Yearn.finance (YFI/USD), Dogecoin (DOGE/USD), Aave (AAVE/USD), Algorand (ALGO/USD), Decentraland (MANA/USD), Enjin (ENJ/USD), Basic Attention Token (BAT/USD), Polygon (MATIC/USD), Shiba (SHIBxM/USD)

​To start trading cryptocurrency on the eToro trading platform, New Zealand residents can deposit funds using various payment methods, such as bank transfers, PayPal, Skrill, NETELLER, credit and debit card and other methods. If you deposit New Zealand dollars to your eToro account, you will be charged between 50 and 100 pips on the exchange rate, depending on the deposit method.
 
For example, if you deposit via bank transfer, the conversion charge is 50 pips. Suppose you deposit NZ$3,000, and the current NZD/USD exchange rate is 0.7150. Instead of getting US$2,145, you’d get US$2,130.

​The minimum first-time deposit for New Zealanders using eToro is US$1,000. After the first time you deposit, all subsequent deposits must be over US$50 except for bank deposits, which have a minimum of US$500.

Besides the various fees and commissions described above, here are some other costs to be aware of:

• Withdrawal fee: eToro charges a US$5 withdrawal fee for any withdrawal. The minimum withdrawal amount is US$30.
• Inactivity fee: if you do not log into your account for 12 months, eToro will charge a monthly inactivity fee of US$10.

Because of eToro’s high transaction costs and restrictive deposit and withdrawal methods, you might be interested in exploring other cryptocurrency exchanges and trading platforms that are based in New Zealand.

• Easy Crypto Review
  
• BitPrime Review
  

​Copy trading is a service where one trader can copy the trades of another. Experienced traders can enlist as strategy providers allowing other traders to copy them for a fee. Copy trading is incredibly popular because trading is time consuming, stressful and requires years of practice even to have a chance of becoming consistently profitable.
 
eToro has developed a thriving copy trading platform that fosters social interaction between users. Strategy providers curate their own micro-communities and interact with their followers, making eToro a social trading platform.
 
Unfortunately, eToro copy trading isn’t available in New Zealand. The copy trading service revolves around CFDs and stocks. As eToro is not authorised by the New Zealand Financial Markets Authority, the broker cannot offer regulated products, such as CFDs or stock trading.

eToro is primarily a forex and CFD copy trading broker. The platform offers CFDs on forex, commodities, indices, stocks and cryptocurrencies. CFDs are derivatives that let traders go long or short to speculate on the rising or falling price of various assets using leverage.
​
eToro does not have a derivatives issuer licence in New Zealand. Therefore the company is not permitted to provide CFDs to New Zealand residents, even from its Australian licensed entity. There are several licensed and regulated forex and CFD brokers in New Zealand, and we have reviewed them in detail:

• BlackBull Markets Review
  
• IG Markets Review
  
• CMC Markets Review
  

eToro is a popular platform for trading stocks because of its 0% commissions on trading shares from the US, Europe and Asia. eToro does not offer stock trading to New Zealand residents. New Zealand has many options for trading or investing in stocks with low and even zero fees; some of our most popular guides explain more:

• How to invest in shares in New Zealand
• Stake Review
• Hatch Review
• Sharesies Review

We compare popular and trusted options below:

Important - in May 2022, BitPrime halted operations after adverse crypto markets led to liquidity issues. We understand BitPrime is looking to re-launch via a crowd-supported campaign and will update this review when its future is more certain.

• Payment methods: Bank transfer, POLI, and debit/credit card via third-party payment provider Simplex
  
• Fees: Fees depend on the payment method and order size. For card payments, the fee is 5%. For bank transfers below NZ$20,000, the fee is 2.9%, for larger transactions, discounts are available
  
• Minimum order size: NZ$100
• Settlement: Private wallet
• Coins available: 89 different coins, including Bitcoin. Almost all coins are able to be sourced through their Custom Order page.
• Learn more: BitPrime

We answer common questions below to help further explain eToro's offering:

No. When the FMA introduced new requirements for short-term derivatives to be licensed from the 1st of December 2017, eToro did not apply or at least was not issued a license from the FMA and therefore was no longer permitted to offer services to New Zealanders. 

eToro is not a publicly listed company. In March 2021, the company announced it is planning to become a publicly listed company through a reverse triangular merger with a Special Purpose Acquisition Company (SPAC) called FinTech Acquisition Corp V (NASDAQ: FTCV). SPACs are a controversial technique for taking a company public because they are not subject to as much scrutiny as a company listing itself on a stock exchange. Considering the substantial investment into eToro from major players like SBI Holding, Softbank, Commerzbank, Sberbank and many others, it’s likely these firms expect a strong exit via a public listing.​

eToro operates an easy to use online trading platform which supports trading various cryptocurrencies against the US dollar. The eToro trading platform supports 30 cryptocurrencies. eToroX is a standalone cryptocurrency exchange trading platform and supports over 100 cryptocurrencies that are physically settled in the exchange account.​

eToro copy trading is not available in New Zealand as the company does not have the necessary licenses to provide forex, CFDs or stock trading in the country.​