eToro’s TradeZero Acquisition Aims to Offset 30% Drop in Crypto Revenue

eToro is bolstering its U.S. expansion by acquiring TradeZero, even as its crypto revenue fell by 30% in Q2.

eToro Reshapes the Crypto Landscape with TradeZero

The acquisition of U.S. broker TradeZero, which generated $80 million in revenue with an 81% gross margin, is seen as a critical move to offset the platform’s $1.34 billion crypto revenue shortfall.

High‑Cost Crypto Exit: 30% Decline

■Total revenue of $1.59 billion dropped $0.41 billion from the comparable 2025 period.

■Crypto revenue hit $1.34 billion, down 30% from last year’s $1.9 billion.

■Crypto cost of revenue stood at $1.35 billion, yielding a net income of $19.7 million.

Financial Impact of the Strategic Acquisition

■TradeZero’s 12‑month revenue of $80 million is expected to make the deal accretive to EPS in the first year.

■Closing is anticipated in the first half of 2026.

■Nasdaq‑listed ETOR shares fell more than 5% in pre‑market trading.

User Behavior and Market Dynamics

■Total crypto trades fell 73% YoY to 1.4 million.

■The invested amount dropped 50%.

■Over 60% of users who traded commodities in Q4 2025‑Q1 2026 subsequently traded equities, and nearly 90% of those also traded crypto on eToro.

Shifting Competition and Future Outlook

■eToro is accelerating its multi‑asset platform transition by acquiring self‑custodial wallet provider Zengo.

■Nasdaq’s acquisition of LeveL Markets supports the “always‑on” market trend.

■The company is working to maintain a competitive edge against rivals like SharpLink, which reported a $394 million net loss.

eToro’s acquisition of TradeZero is a strategic move to navigate the volatility in crypto revenues. The deal strengthens its U.S. presence and reinforces its multi‑asset strategy, but the sustainability of high‑cost crypto operations and the long‑term impact of shifting user behavior warrant close monitoring.