eToro is fast becoming a popular place to trade bitcoin and other cryptocurrencies. But should you be trading Bitcoin on eToro? In this post I break down some of the pros and cons and whether it's a good fit for you. Let me know in the comments if you've been trading Bitcoin on eToro and what you're experiences have been.
Why Trade Bitcoin on eToro:
Here are some of the reasons why I believe eToro is a decent place to trade Bitcoin:
- Go Long or Short – You can open both long or short positions on eToro. This means you can profit when the price goes down as well as when the price goes up.
- Easy to use Interface – eToro has one of the best designed trading platforms out there. It's easy to use and anyone can pick it up.
- Social Trading – on eToro you can share your trades, follow people, ask questions and leave comments. It's a great way to learn about trading.
- Trade a huge number of assets and markets – eToro isn't just a crypto trading platform. You can trade stocks, forex, commodities, etfs, indices and more. This means you can trade your cryptos right alongside your traditional investments.
Fiat Deposit Options
Currently one of the most difficult things about crypto is getting fiat currency into the ecosystem. Luckily eToro makes that really easy. You can trade Bitcoin using a credit card, bank transfer and even PayPal. And after you're done trading you can easily withdraw back to your bank account or paypal account. This makes trading quick and easy.
Cryptos you can trade
eToro is consistently adding new cryptocurrencies. Currently you can trade:
- Bitcoin Cash
- Ethereum Classic
- Binance Coin
The number #1 reason to use eToro for trading Bitcoin is to copytrade. eToro is a copytrading platform – you can follow traders and automatically copy their trades. Whenever they make a trade, your account makes the same trade. You can browse through the profiles of thousands of traders, see what trades they've made in the past and how profitable they have been.
If you've never traded before then copy trading is a good way to learn about trading from a more experienced trader. Some of the best traders on eToro have been profitable every year with gains over 10%. These are the type of people you should be looking to emulate.
You can start copytrading with as little as $200. All you need to do is:
- Sign up to eToro (Disclaimer: 62% of retail CFD accounts lose money)
- Deposit at least $200. eToro has set the minimum copytrading amount at $200 as any less than this would result in copied trade sizes being too small.
- Find someone to copy – you can search by profit, risk level, drawdown etc to find someone who is lower risk and has consistent returns.
- Copy! Now whenever they make a trade, your account will mirror those trades.
Get Paid to Share your Bitcoin Trades
If you're an experienced trader then you get paid for sharing your trades on eToro. People will be able to copy your trades and as a result eToro rewards traders with cash and other perks. The top traders on eToro earn a full-time income just from sharing their trades and that doesn't include their trading income.
You can find out more about the popular investor program on eToro here.
Disclaimer: 62% of retail investor accounts lose money when trading CFDs with this provider.
Practice Trading Bitcoin
If you're not ready to spend real money to trade you can still use eToro. When you sign up for a free account, you're given $100k in virtual funds. You can use this to practice trade under real market conditions. It's a great way to learn how to trade and I would recommend if you're new to trading this is how you start.
Things to look out for:
- Spread – instead of a commission, eToro uses a spread which is common of forex and cfd platforms. The spread is the small difference between the bid and ask, or buy and sell prices. So when you open a “long”, buy trade, it will be opened at the sell or “short” price. This is how eToro makes money.
- Leverage – you can't use leverage on Bitcoin trades, but you can on some of the other cryptos. Although eToro sensibly only offers 2x leverage on cryptos. I would recommend not trading with leverage.