eToro to Acquire TradeZero Amid 30% Crypto Revenue Drop

eToro is acquiring TradeZero as part of its U.S. expansion strategy.

The Deal as a Cornerstone of U.S. Market Penetration

■eToro aims to close the TradeZero acquisition in the first half of 2026.

■The move follows a series of digital‑asset initiatives, including the earlier Zengo self‑custody wallet purchase.

Crypto Revenue Takes a Sharp Dive

■In Q2 2025, eToro reported crypto revenue of $1.9 billion, which fell to $1.34 billion in 2026—a 30% decline.

■Crypto cost of revenue stood at $1.35 billion, leaving a net crypto profit of merely $19.7 million.

■Total net income settled at $53.4 million.

TradeZero’s Financial Snapshot

■Generated $80 million in revenue over the trailing twelve months with a 81% gross margin.

■eToro expects the acquisition to be accretive to adjusted earnings per share in the first year post‑close.

Market Reaction and Stock Movement

■Nasdaq‑listed ETOR shares slipped more than 5% in pre‑market trading following the announcement.

■Analysts attribute the dip to the broader weakness in eToro's crypto segment.

Berk Arıcan: The 30% drop in crypto revenue signals a pressing need for eToro to reassess its tokenomics, particularly inflationary pressures and user‑activity distribution. TradeZero’s robust gross margin presents a valuable diversification lever, yet crypto volatility will continue to constrain short‑term earnings outlooks. Strategically, the Zengo integration and self‑custody capabilities could boost long‑term retention, but those benefits will materialize only once liquidity and trading volumes stabilise.