On Wednesday, August 25, eToro, the world’s biggest social trading network, released its latest financial results for the period ending June 30, 2021.
In the second quarter, the multi-asset investing platform witnessed an increase in revenue from fees on cryptocurrency trades and new user registrations.
According to the financial report, cryptocurrency transactions accounted for 73 percent of total commissions charged by the eToro platform in Q2 2021, compared to just 7% of commissions produced by cryptocurrency trading in the same quarter the previous year.
In the second quarter, eToro made a total profit of around $362 million from trading commissions, up from roughly $161 million in the same previous year. In addition, the investing business made $264 million in bitcoin commissions in Q2 2021, which is 23 times more than the $11.27 million in cryptocurrency commissions it made in the same quarter last year.
According to a survey of the top cryptocurrencies traded on the eToro platform, many assets contributed to the record-breaking earnings. For example, Bitcoin had the most trading volume, and XRP had the highest commissions of any cryptocurrency. However, Bitcoin only accounted for 7% of total cryptocurrency commissions, less than half of Ethereum (ETH), Cardano (ADA), and Ripple (XRP) contributions, and even less than Dogecoin (DOGE), the meme cryptocurrency that the platform introduced in May.
“The rise in self-directed investing and eToro’s growth is underpinned by long-term secular trends in investor behaviour,” Yoni Assia, CEO and co-founder of eToro said of the outstanding income statement.
Investors, according to Assia, desire three things from an investing platform: financial education tools, a pleasant user experience, and easy access to cryptocurrency investments.
EToro’s total trading commissions were $362 million in the most recent quarter, with $290 million in net trading revenue. However, a non-cash charge of $71 million in stock-based compensation for eToro employees resulted in a net loss of $89 million. In addition, a $36 million transaction cost connected to the company’s planned merger with SPAC FinTech Acquisition Corp. was also shown as a net loss. eToro started in May to go public through a merger at a $10.4 billion value.
In addition, eToro attracted 2.6 million new clients in the second quarter of 2021, up 121 percent from the previous year’s same period. The firm had 23.2 million users on its platform as of June 30, 2021.