On the crypto side, for those who are more experienced traders, we launched eToroX, our regulated crypto exchange earlier this year, providing them with a secure platform to trade crypto and tokenized assets on the blockchain.
Acquisitions were a major trend for crypto exchanges this year, with Circle offloading Poloniex, before itself being acquired by Kraken. Binance took up a stake in derivatives exchange FTX, meanwhile, and Coinbase divested itself of Earn.com. Etoro was not exempted from this M&A flurry either, acquiring Firmo in March. The Danish business provides a platform that enables exchanges to execute smart financial contracts across various assets, including crypto derivatives, and across all major blockchains.
Then, explains Yoni Assia, “In November we acquired Delta, the crypto portfolio tracker app, which will help investors make better decisions around their crypto assets by providing tools such as portfolio tracking and pricing data.”
In 2019, Etoro surpassed 12 million registered users in over 100 territories, including the U.S., which the social trading platform entered this year on a mandate to “make trading, investing and managing money easy for everyone,” according to Assia. Here, it finds itself going up against rivals such as millennial investor favorite Robinhood.
When asked about the greatest challenges Etoro encountered this year, Assia cites issues that will be familiar to all exchange operators: “the volatility of prices, and recently, questions around the security of assets on exchanges.” However, he claims that “a lot of people who joined us in 2017 at the peak of crypto’s popularity have stayed and this year have diversified into other areas such as stocks,” noting that “Crypto assets are often a gateway to investing for many people on the Etoro platform. We always say invest in the brands you love, so IPOs such as Uber have helped attract more investors.”
Multi-asset exchanges such as Etoro, which offer cryptocurrencies alongside stocks and commodities, are also duty bound to educate, given that many of their users have no previous experience of such instruments. “Not only are we providing them with a place to trade, we also ensure they have access to information to help them make informed decisions about their trading behavior,” acknowledges Assia.
“We provide regular analysis of price performance, changes and events in the sector, while reassuring them about the safety of Etoro as a regulated platform. Etoro is profitable and we use that profit to develop more services for our customers, broadening the offering to create a platform that people can use to manage and invest their money to suit their needs, with a wide range of assets to choose from, beyond cryptocurrencies.”
This year, it was reported that tax agencies such as the IRS and HMRC have been contacting cryptocurrency exchanges to bulk request information on customer activity. When asked whether Etoro had fielded any such approaches, its CEO had this to say:
We have been required by tax agencies in the jurisdictions where we operate to provide information on our customers and as a responsible, regulated business, we have done this. We firmly believe that tax harmonization of crypto assets is a precursor to regulation, which is much needed to bring security to consumers and confidence to regulators. 2020 will be a coming of age for crypto assets.
It will also be a coming of age for Etoro if Yoni Assia’s predictions come to pass. According to the company’s founder and CEO, “Etoro is on track to launch a debit card, more details of which will follow in 2020.” He also asserts that “We believe the future of financial services lies in the tokenization of investable assets,” and tips Etoro to focus its energies here in the coming year.
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