eToro Acquires TradeZero as Crypto Revenue Drops 30%
eToro plans to buy US brokerage TradeZero amid a 30% drop in Q2 crypto revenue. The Nasdaq-listed platform saw total crypto trades plunge 73% in July, with shares falling 5% pre-market.
Quick Take
eToro Q2 revenue fell to $1.59B, crypto revenue down 30% YoY.
Total crypto trades in July dropped 73% year-over-year.
eToro acquires TradeZero to expand US presence.
Shares fell 5% pre-market after the earnings release.
Market Impact Analysis
NeutraleToro's financials and acquisition don't directly influence crypto prices; they reflect existing market conditions.
Speculation Analysis
Key Takeaways
- eToro's crypto revenue fell 30% YOY to $1.34B as retail trading momentum slowed across digital assets.
- Total crypto trades plummeted 73% in July to 1.4 million, underscoring a dramatic drop in user activity.
- eToro announced the acquisition of US brokerage TradeZero to expand into equities and options markets.
- ETOR shares dropped over 5% pre-market as investors assessed the mixed results and strategic pivot.
- The TradeZero deal, set to close H1 2026, adds $80M in high-margin revenue and US regulatory licenses.
What Happened
eToro released mixed second-quarter results revealing a sharp decline in crypto revenue while simultaneously unveiling a strategic acquisition. The trading platform reported total revenue of $1.59 billion, down from $2 billion a year earlier, driven primarily by a 30% slump in crypto asset revenue to $1.34 billion. The company also announced it will acquire US online brokerage TradeZero, a move designed to accelerate its expansion beyond cryptocurrency and into traditional equities and options. The news sent eToro’s Nasdaq-traded shares down over 5% in pre-market trading, extending previous declines. The acquisition is expected to close in the first half of 2026 and become immediately accretive to adjusted earnings per share.
The Numbers
eToro’s total revenue declined to $1.59 billion from $2 billion year-over-year. Crypto revenue dropped 30% to $1.34 billion, while crypto-related costs totaled $1.35 billion, leaving a slim net income from crypto of just $19.7 million. Total net income reached $53.4 million, with equities and commodities contributing $141 million. The most striking metric: total cryptocurrency trades in July collapsed 73% year-over-year to 1.4 million, with invested amounts down 50%. TradeZero, which generated about $80 million in revenue over the last 12 months with 81% gross margins, offers eToro a higher-margin diversification path.
Why It Happened
The crypto revenue decline stems from a broader market cooldown characterized by lower volatility and shrinking retail participation. After a strong 2025, trading volumes have normalized, leaving platforms like eToro with reduced activity. The July trade collapse highlights how quickly retail traders disengage during subdued market conditions. eToro’s acquisition of TradeZero is a direct response: diversifying into US equities and options provides a hedge against crypto cycles. The company has been repositioning as a multi-asset platform, with recent moves including the planned acquisition of self-custodial wallet provider Zengo.
Broader Impact
eToro’s pivot reflects a growing trend among crypto-native platforms to diversify beyond digital assets. By acquiring a regulated US broker, eToro gains immediate access to American retail investors and a broader product suite. This could trigger further consolidation in the online brokerage industry as firms seek to capture multi-asset traders. The move also underscores the vulnerability of platforms that rely heavily on crypto trading revenue.
What to Watch Next
- Integration milestones for TradeZero and how quickly eToro can onboard US users onto equities and options.
- Crypto revenue trends in the second half of 2026 — any rebound could improve eToro’s earnings outlook.
- Further acquisitions as eToro continues its multi-asset platform transformation.
This article is for informational purposes only and does not constitute financial advice.
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