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The social trading and multi-asset brokerage firm of eToro rolled out their second-quarter report revealing that cryptocurrencies caused a surge in the platform’s trading volumes, not to mention that it also represents 73 percent of the total trading commissions. Indeed, a far cry from its figures around the same period about a year ago.
Cryptocurrency playing a huge part
As mentioned, the trading platform released its Investor Update showing its commissions rose by almost 23 times during the second quarter. This is in comparison to last year’s Q2 figures. Cryptocurrency trading commissions were at an impressive $264.2 million in the second quarter of this year, leaving their Q2 2020’s figure of $11.2 million in the dust. This translates to a whopping 2259 percent increase.
Also, during Q2 of 2020, the share that cryptocurrencies represented of total trading commissions was just seven percent. Come Q2 of 2021 and such commissions skyrocketed by 73 percent. Further, it was revealed that bitcoin (BTC) raked in the most trading volume while XRP had the most commissions out of any digital assets.
The report also showed that the total trading commissions rose by $362 million during the past quarter alongside a net trading income of $290 million. This is in comparison to Q2 2020’s total trading commission of $161 million which is a 125 percent increase. It’s worth noting that the total commissions are composed of commissions from trading activity, interest, and other charges.
EToro CEO’s delight
Yonni Assia – eToro’s CEO and co-founder – published a letter together with the report. He noted that eToro’s growth was underpinned by long-term secular trends in investor behavior and was enabled by giving simple access to crypto through a user-friendly mobile interface together with financial education. Further, Assia stated that Cryptoassets drove financial commissions during the second quarter of 2021 as it reflected strong interest from retail investors in crypto markets. The CEO went on to note that the interest was diversified across the cryptos offered by eToro with the highest trading volumes in bitcoin, XRP, ether, ADA, and dogecoin (DOGE).
Set to go public
Albeit eToro’s awesome growth, the trading platform suffered a negative net income of $89 million as this has been attributed to a non-cash charge of $71 million in stock-based compensation to employees and $36 million in transaction costs that are connected to the special-purpose acquisition company merge with FinTech Acquisition Corp.
For the uninitiated, eToro is scheduled to go public on the NASDAQ exchange through a $10 billion SPAC that is set to close during this quarter. This also includes commitments for a $650 million private placement coming from investors like Vision Fund 2, ION Investment Group, Softbank, Wellington Management, and Fidelity Management and Research Company LLC.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
