Last month, Yoni Assia, founder, and CEO of eToro was a guest on Anthony Pompliano’s Off the Chain Podcast. It was an hour-long conversation where they discussed Yoni’s background as a teenage trader, as a programmer in the military, being an OG in the cryptocurrency industry in the early days of Bitcoin, founding eToro and now, eToro’s U.S. expansion and what it means for the cryptocurrency industry.
eToro closed a Series E funding round of $100M in March part of that funding was deployed towards growth and expansion to solidify its position as a global Fintech leader. eToro’s entry into the U.S. started with the launch of its crypto trading exchange and cryptocurrency wallet.
Is cryptocurrency trading legal in the U.S.?
Many people wonder if it is legal to buy Bitcoin or other cryptocurrencies in the U.S. The questions are valid if you take the unclear regulatory environment into consideration. It is not quite clear if Bitcoin is a currency, a commodity, or an investment. In fact, last month the IRS revealed that it is still working on its first tax guidance for cryptocurrency since 2014 and that it will “soon” publish a guidance.
So, is the use, trade or investments in cryptocurrencies legal in the U.S.?
The simple answer is Yes! It is legal to use cryptocurrencies such as Bitcoin in the U.S. and the regulations allow such transactions to be subject to the same reporting, taxes, and KYC requirements applicable to any other currency. In fact, using Bitcoin or other cryptocurrencies for payment is not much different from using the USD or Euro for payments. Likewise, trading Bitcoin is not much different from forex trading inasmuch as current regulations are currently concerned.
The U.S. is the fintech capital of the world
Yoni provided some background on why eToro made a push into the U.S market at this time. He observed that “U.S. crypto holders have a strong appetite for diversified portfolios… and we’re committed to offering the best tools and assets to help them manage their investments all in one place.”
Interestingly, he echoed the same sentiments in an earlier chat with TechCrunch noting that “we think [the tokenization of assets] is a bigger opportunity than the internet and we have to be in the U.S. when it happens, given it’s the financial hub in the world.”
Now that eToro’s U.S. platform is launched, it will support the trading of crypto assets so that traders in the U.S. easily transfer cryptocurrencies to and from their trading accounts. In addition, the trading platform makes it easy for traders to convert one cryptocurrency into another cryptocurrency. eToro’s digital multi-signature wallet is also versatile enough to allow users to send and receive different types of cryptocurrencies as opposed to many wallets that only supports a single cryptocurrency.
eToro currently has more than 10 million users, who trade and hold more than 1,500 different types of assets in different markets across 140 countries. In 2018, traders on eToro traded a combined $1 trillion worth of assets globally.
What does the near future hold?
The cryptocurrency market is currently building up momentum to have an extended rally that might restore the price of major coins and the market cap of the entire industry to the 2017 highs. Bitcoin crossed the psychological barrier of $10,000 and it is currently testing the resistance to escape beyond $11,000. The weekend rally placed the top 10 cryptocurrencies in the green and Bitcoin has conveniently delivered about 161% year-to-date gains as seen in the chart below shows.
eToro’s U.S. launch is a strategic move ahead of the next bull run in the cryptocurrency market. eToro decided to make its U.S. debut with the launching of crypto to crypto exchange so that traders can leverage its unique social trading features in the cryptocurrency trading activities. eToro has a tripartite nature that includes an educational resource, a trading platform, and a social network. Those three features differentiate eToro from other trading platforms.
Users can connect with other traders, see their trades, ask questions and effectively practice how to trade. eToro also has a “Copy Trader” feature that allows a user to proportionally allocate their portfolio to match the portfolio of another trader and automatically mimic their trading activities.
Going forward, eToro also has plans for a cryptocurrency mobile wallet on both iOS and Android operating system. After the MVP of the wallet is launched, future iterations will see it being outfitted with more features until it becomes a full-fledged electronic wallet.
Disclosure: Bear in mind that some of the links in this post are affiliate links. We may receive a commission for purchases made through these links.