ETOR Fintech · Trading platform · Crypto · Social investing · Thesis updated July 19, 2026

eToro is becoming more than a crypto cycle

The bull case is that eToro keeps moving from trading bursts toward longer-term assets, subscriptions, and AI tools.
Capital markets revenue grew 71% year over year to $166 million in Q1 2026, helped by heavy commodities trading.
Crypto still matters, and its swings can make earnings look strong one quarter and weak the next.
Net interest income was $48 million in Q1 2026, down 5% year over year as rates fell and users reduced leverage.
The next proof points are Club Subscriptions, Agent Portfolios, Zengo, and the expected H2 2026 US rollout of CopyTrader and Smart Portfolios.

01 Running thesis

Less tied to one trade

eToro started as a simple trading app, but the thesis now depends on whether it can become a broader investing home. The company wants users to hold more assets, copy other investors, use portfolios, and pay for premium services instead of only showing up when crypto is hot.

The bull case has real support. In Q1 2026, capital markets revenue grew 71% year over year to $166 million. Commodities drove much of that activity, and management said commodities were 60% of trading commissions in the quarter. That helped offset weaker crypto activity.

New products add optionality. Agent Portfolios let users put money into AI-driven strategies. The eToro App Store and builders portal could bring more trading and analytics tools into the platform. Zengo gives eToro a self-custody wallet and access to thousands more tokens, including tokenized stocks.

The bear case is that this is still a trading business with cycles. Crypto can pull users away from stocks and commodities, and then cool fast. Net interest income also faces pressure if rates fall or users borrow less. Management also does not yet know how much of the 30% of stock volume shifting to 24/5 aftermarket hours is new activity rather than trading that moved from regular hours.

May 2026▲Q1 2026 showed the multi-asset model working, with capital markets revenue up 71% year over year to $166 million while crypto was weaker. The update also added Zengo, Agent Portfolios, the eToro App Store, and the expected H2 2026 US rollout for CopyTrader and Smart Portfolios.

Mar 2026▲The 2025 Form 20-F added evidence that eToro is trying to build more recurring and long-term revenue. The eToro Club Subscription launched in November 2025, and the company added partnerships for retirement and life insurance products in France.

Feb 2026→Q4 2025 showed why the business is hard to judge from one asset class. Crypto net trading contribution fell 72% year over year to $26 million, but capital markets rose 43% to $116 million.

Nov 2025▲The initial thesis centered on eToro's social and multi-asset model. Q3 2025 net contribution rose 28% year over year to $215 million, helped by strong crypto activity and record inflows into Copy Trading.

02 Business model

Spreads, interest, and add-ons

eToro makes money when users trade. It earns net trading contribution from capital markets, meaning equities, commodities, and currencies, and from cryptoassets. In plain terms, eToro keeps part of the spread or fee tied to trades.

A second profit stream is net interest income. eToro earns interest from user cash, corporate cash, and margin positions, after related costs. This can be helpful in higher-rate periods, but it weakens when rates fall or users reduce borrowed positions.

The company also earns from eToro Money, which includes currency conversion, withdrawals, crypto transfers, wallet fees, and debit card interchange. The newer eToro Club Subscription adds a recurring revenue stream, but it is still small compared with trading and interest.

The model works best when users stay active across asset classes. If they rotate from crypto into commodities or stocks, eToro can still earn. If users stop trading, reduce leverage, or regulators slow new features, revenue can drop quickly.

03 Product portfolio

Products that keep users active

Cash cow

Multi-asset trading

Users can trade equities, commodities, currencies, and crypto, with the exact products depending on location. This is still the main money engine.

Growth engine

CopyTrader

CopyTrader lets a user mirror another investor's trades. It is a key social feature, and eToro expects full US rollout in H2 2026.

Growth engine

Smart Portfolios

Smart Portfolios package strategies into portfolios that users can buy. eToro expects the US rollout in H2 2026 after regulatory work.

Option

Agent Portfolios and AI tools

Agent Portfolios let users allocate capital to AI-driven strategies. The bet is that AI tools raise engagement and trading activity.

Option

eToro App Store and builders portal

The App Store brings trading and analytics apps into the eToro ecosystem. The builders portal lets outside developers create tools for users.

Option

Zengo wallet and Web3

Zengo adds a self-custodial crypto wallet, meaning users control their own keys. It expands eToro's crypto reach to thousands more tokens.

Steady

eToro Money and savings products

eToro Money includes the card, currency conversion, withdrawals, and related services. The company is also adding local saving products, such as Cash ISAs and partnerships for retirement and life insurance.

04 Business segments

What fed 2025 net contribution

Net Trading Contribution, Equities, Commodities and Currencies46%growing fast

Net Trading Contribution, Cryptoassets18%declining

Net Interest Contribution25%declining

eToro Money10%modest

Subscriptions and Other1%modest

This mix uses fiscal 2025 net contribution components from eToro's 2025 Form 20-F. The mix can shift fast because users rotate between crypto, commodities, equities, currencies, and cash.

05 Risk factors

What could break the thesis

Crypto cycle whiplash

High impact · High odds

Crypto trading can rise fast and then fade. In Q4 2025, crypto net trading contribution fell 72% year over year to $26 million, while capital markets helped cushion the hit. If both crypto and capital markets slow at the same time, the multi-asset safety net gets weaker.

We watchQuarterly net trading contribution from crypto and capital markets, especially whether both fall together.

Lower rate pressure

Medium impact · High odds

Net interest income depends on user cash, corporate cash, margin balances, and interest rates. In Q1 2026, net interest income was $48 million, down 5% year over year because of lower rates and user deleveraging. If rates keep falling or users borrow less, this line can keep shrinking.

We watchNet interest income, average user cash balances, margin use, and central bank rate cuts.

US feature approvals take longer

High impact · Medium odds

CopyTrader and Smart Portfolios are important growth catalysts in the United States. Management said CopyTrader is in limited rollout and that both CopyTrader and Smart Portfolios are expected to be in complete rollout in H2 2026. If licensing or compliance work slows, the US growth story gets pushed out.

We watchCompany updates on the RIA license, broker-dealer rollout, and full US availability of CopyTrader and Smart Portfolios.

24/5 trading may not add volume

Medium impact · Medium odds

Extended-hours trading sounds good, but it may only move trades from regular hours into aftermarket hours. Management said 30% of stock volume shifted to aftermarket hours, but it does not know how much was additive versus substitute volume. If it is mostly substitute volume, the feature may raise convenience without raising revenue much.

We watchDisclosure on total stock trading volume, aftermarket volume, and revenue per user after 24/5 trading expands.

Web3 expansion adds compliance and custody risk

Medium impact · Medium odds

Zengo moves eToro deeper into self-custody, DeFi, and a much wider token universe. That may improve product reach, but it also adds complexity. More tokens and on-chain activity can bring tougher compliance, security, and regulatory demands.

We watchRegulatory actions tied to crypto wallets, token listings, staking, DeFi access, and any disclosed security incidents.

06 Quick answers

In one breath

How does eToro make money?

eToro earns from trading activity, interest income, eToro Money fees, and newer subscription services. Trading is still the biggest driver, while interest income depends on rates and user balances.

Is eToro mainly a crypto company?

Crypto is important, but eToro is not only a crypto platform. It also earns from equities, commodities, currencies, portfolios, interest, and money services, and capital markets were strong in Q1 2026.

What is the main growth catalyst for eToro?

The clearest catalysts are Agent Portfolios, Club Subscriptions, Zengo, and the full US rollout of CopyTrader and Smart Portfolios expected in H2 2026. The key test is whether these products increase lasting engagement, not only short trading bursts.

What is the biggest risk for ETOR investors?

The biggest risk is that trading activity stays cyclical. If crypto cools, commodities slow, and net interest income falls at the same time, earnings can be lumpy.