eToro, the social investing platform, is launching a full-fledged cryptocurrency exchange and mobile wallet and expanding into the United States.
Announced Tuesday, the Israel-based company has opened the waiting list for people in the U.S. who want to trade bitcoin, ethereum, litecoin, XRP, dash, bitcoin cash, stellar, ethereum classic, NEO, and EOS.
"Consumers all over the world should have access to the tools they need to participate in cryptocurrency markets, regardless of their expertise," CEO Yoni Assia said in a press release.
Previously, eToro offered crypto trading only on a very limited basis. For example, in 2014 it introduced contracts for difference (CFDs) in which users could bet on the direction of bitcoin's price without actually touching the cryptocurrency.
Then early last year, the company enabled customers to buy or sell XRP, ether and litecoin on its platform, but it did not allow them to deposit or withdraw cryptocurrencies from their accounts, according to eToro's terms and conditions.
Now eToro plans to launch a true cryptocurrency exchange, plus a corresponding mobile wallet, sometime in 2018. The new exchange will have bonus over-the-counter trading options for institutional investors.
Setting eToro apart from other exchanges, top cryptocurrency traders will be able to reap income by making their portfolios transparent on eToro and allowing other traders to copy their trades.
The platform, which also offers trading in traditional assets from stocks to commodities, is perhaps best known for its social features. Similar to networks like Facebook or Twitter, eToro users can follow influential traders and topics with customized news feeds.
Guy Hirsch, eToro's U.S. managing director, told CoinDesk users can directly message traders they copy, adding:
"If the market is bitcoin, then every time there is a mention about bitcoin by some other user you'll be able to see that in your news feed. You'll be able to comment on that, share that or like it. Similarly, you can start a conversation about bitcoin, then other people who have bitcoin on their watch list will be able to see your post."
Every month, the platform pays select traders out of its marketing budget a sum worth roughly two percent of the trades and gains other users copied. Users can choose to "copy" popular traders with just a fraction of their portfolios, adjusting the amount based on how comfortable they feel with the influencers' risk level.
Once the cryptocurrency offerings launch in the U.S., eToro will invite top cryptocurrency traders to join this program, which so far has 250 traders, each with thousands of followers copying them.
"We have a lot of success stories about people making a good living, or it is their only source of income," Hirsch said. "That's their profession, basically, managing their eToro portfolio."
According to the eToro team, those popular traders earn $500 to $40,000 a month.
A long-time bull
eToro was founded in 2007, a year before bitcoin was conceived. Yet Assia is no stranger to cryptocurrency.
He helped invent bitcoin's colored coins, second-layer tokens that predated the ethereum-based ERC-20 tokens favored by today's crowdfunded startups.
eToro has raised $162 million since it launched in 2007, including a recent round in March led by China Minsheng Financial, with support from SBI Group, Korea Investment Partners, and the London Stock Exchange Group's private placement platform.
The platform boasts 10 million users from 140 countries, from China and Russia to Switzerland and the United Kingdom.
Although Hirsch would not give a timeline for when cryptocurrency options will be available in the U.S., he did say eToro will offer cryptocurrency trading in every jurisdiction in the country.
Broadly, eToro plans to build bridges between traditional financial markets and cryptocurrency communities.
Hirsch said he expects all assets – from real estate to metals, commodities, stocks, intellectual property, and brand equity – will be tokenized over the next decade in a way that lends greater liquidity to those markets through exchanges.
"I believe those will come onto the blockchain. And eToro plans to be a leader in propelling that vision into a reality."
Image of CEO Yoni Assia via eToro