Cryptos have helped eToro earn $362 million in total commissions

In comparison, crypto assets accounted for just 7% of eToro’s commissions during the second quarter of 2020.

The surge in crypto-currency prices and trading activity saw eToro earn up to 73% of its commissions from crypto assets during the second quarter of 2021, the online broker revealed in its financial results released on August 25.

In a letter to investors and partners, eToro co-founder and CEO Yoni Assia noted that the company’s commissions in the second quarter of 2021 jumped 125% to $362 million compared to the same quarter a year earlier. Net trading revenue also grew by triple digits, rising 136% to $291 million.

The CEO explained to investors that as crypto-currencies experienced a major price spike, eToro’s total trading commissions exploded. Overall, crypto assets brought in 73% of the company’s revenue and accounted for $264.26 million in recorded commissions. The increase in trading commissions was significant compared to the results reported in the second quarter of 2020, when eToro raked in about $11.2 million from crypto assets. So while crypto assets accounted for only 7% of commissions in Q2 2020, commodities had brought in 45% and stocks made up 41% of revenue. The numbers reversed in the second quarter of 2021, with commissions from commodities and equities shrinking to 7% and 18% respectively, while cryptos soared to account for nearly three-quarters of trading commissions.

According to Assia, this growth reflects the move towards self-directed investing seen amid an explosion in user numbers. The social trading platform has seen its global user base grow to more than 23 million, with 2.6 million new users reportedly opening accounts in the second quarter.

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This growth contributed to the spike in trading activity, eToro’s chief executive noted, pointing to “strong retail investor interest in crypto markets” in Q2.

“Interest was diversified across the cryptos offered by eToro with the highest trading volumes in BTC, XRP, ETH, ADA and DOGE,” Assia added in the letter.

XRP recorded the highest total commission return for eToro with 16%, while Cardano (ADA) with 15% and Ethereum (ETH) with 14% provided the next highest totals. Bitcoin (BTC), which accounts for the most assets under management with 22%, contributed only 7% to trading commissions.