Not all brokers these days allow users to buy cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH), as these assets have not yet been directly incorporated into the most important exchanges around the world.
However, with eToro, individuals can buy and sell a wide range of crypto tokens easily by using the firm’s proprietary social trading platform, which allows them to transact with 18 different coins while also making available other alternatives like commodity crosses, crypto crosses, and currency crosses.
In the following guide, we will explain how you can use eToro to buy and sell cryptocurrencies, so you can start incorporating this innovative asset class into your investment portfolio right away.
Step #1 – Open an account and deposit money with eToro
Opening an account with eToro is very easy and the process starts by clicking the “Join Now” button located in the upper right corner of the firm’s official website.
After that, the user will be prompted to provide a username, e-mail, and password to complete the registration or you can also use your Facebook or Google credentials to speed up the process.
The minimum deposit to start transacting with cryptocurrencies through the eToro platform varies depending on your country of residence.
For example, if you live in Israel, the minimum deposit is $10,000. Meanwhile, for residents of Australia and the United States, the minimum amount to open an account is $50.
For Chinese, Hong Kong, and Macau residents the minimum deposit is $500 while for the remaining countries the minimum amount required is $1,000 in most cases.
Step #2 – Check out the selection of cryptocurrencies available for trading
eToro’s platform has made available a total of 18 different crypto tokens you can trade with based on your due diligence and knowledge of this market.
You can access all the crypto instruments available within the platform by clicking the “Trade Markets” tab located in the left panel shown in the picture to then click on the “Crypto” button found at the top of the screen.
The portfolio of cryptocurrencies available within the eToro platform include:
- Bitcoin (BTC).
- Ethereum (ETH).
- Bitcoin Cash (BCH).
- Ripple (XRP).
- Dash (DASH)
- Litecoin (LTC).
- Ethereum Classic (ETC).
- Cardano (ADA).
Keep in mind that the value of these coins is expressed in United States dollars, while you can also trade a cross between certain coins and other fiat currencies such as the BTC/EUR and the ETH/EUR cross.
eToro has made available a total of 64 different crosses between the most popular cryptocurrencies and their fiat peers.
Additionally, you can trade a cross between gold and BTC, which reflects how many Bitcoins you can buy with a troy ounce of gold.
Finally, you can also trade crosses between two cryptocurrencies such as the ETH/BTC. eToro has made available a total of 16 different crosses between crypto tokens and they will probably keep adding new ones as time passes.
Step #3 – Analyze the instrument you would like to buy
You can use the eToro platform to analyze the price action of cryptocurrencies through the platform’s charting tool, which puts a total of 70 different technical indicators at your disposal along with multiple time frames and chart displays.
You can use all these tools to identify trends, potential buy and sell signals, support and resistances, and other technical elements that might help you in assessing where the price might be heading in the near future.
To access these charts you have to first click the instrument you would like to trade and then you can click on the “Chart” button located below the ticker information.
Step #4 – Buy or sell the instrument you have chosen
Based on your due diligence, if you believe the price of the instrument will go up you can take a long position by buying the cryptocurrency. On the other hand, if you believe the price will go down from where it is you can click on the Sell button to short-sell the instrument.
To do this, you have to click the “Trade” button located right next to the ticker information.
Once you do that, a window will be displayed where you can set the amount of the cryptocurrency that you would like to buy or you can also place the order as a certain number of coins depending on your personal preference.
Additionally, you can place a limit order for your purchase. This means that the system will buy or sell BTC only once the price has reached a certain level you have established when you placed the order.
After that, you can click the “Set Order” button to complete the transaction and voilá!
Now that you know how to use eToro to buy cryptocurrencies you can get started by opening an account and making a deposit so you can start trading as soon as convenient.
Make sure you conduct a thorough due diligence on the instruments you would like to buy or sell and keep in mind that cryptocurrencies are highly volatile assets.
Therefore, consider placing a stop-loss order once you have entered a position so you can avoid a big loss in case your trade turns against you.