Chapter 4

eToro sits in a crowded field. Measured by profit, it is a fraction of Robinhood, Coinbase, or Interactive Brokers; measured against the retail leveraged-trading brokers it most resembles, it is the largest by account count and among the fastest-growing. Its differentiation — a social-investing network and a genuinely multi-asset book — is real but narrow, and the industry tailwinds it cites are structural for the category yet shared by every rival and pro-cyclical. The moat defends a niche, not a fortress.

The industry moving its way

eToro's growth rides demand forces that are real and, on the company's own sourcing, sizeable. Global ETF assets grew 27% in 2024 to $14.6 trillion and are projected by PwC to exceed $26 trillion by June 2029; the cryptoasset market capitalization was roughly $3 trillion at the end of 2025 per CoinGecko, and traditional finance and crypto continue to converge as regulation clarifies [1]. Retail participation is rising, and a rung of that demand is flowing to social channels: a 2022 BNY Mellon and World Economic Forum survey found 74% of retail investors would invest more with more opportunity to learn, over 60% of U.S. investors under 35 use social media as a primary source of investment information per the FINRA Investor Education Foundation, and Deloitte projects AI-enabled apps could become the leading source of retail investment advice by 2027 [2].

Sources: FY2025 Annual Report (Form 20-F), Trends in Our Favor [3], [4].

Two qualifications keep these tailwinds from being an edge. They lift the entire field — Robinhood, Coinbase, IG, and every neo-broker cite the same retail-participation and crypto-convergence story — so they explain why the category grows, not why eToro wins inside it. And they are pro-cyclical: the ETF and crypto figures swell in bull markets and reverse in downturns, the same beat that runs through Net Contribution and, from there, to earnings. The tailwinds are a reason the addressable market is large and growing, not evidence that eToro's slice of it is protected.

Where it sits in the field

Against the largest listed platforms, eToro is a small company. Coinbase turned over $7.2 billion of revenue and Interactive Brokers $6.2 billion in net revenues in 2025; Robinhood earned $1.9 billion of net income on $4.5 billion of revenue [5] [6] [7]. eToro's $868 million of Net Contribution and $216 million of net income put it at roughly a sixth of Coinbase's profit and a ninth of Robinhood's [8]. On the metric that matters to a self-directed retail platform — funded accounts — Robinhood's 27.0 million dwarfs eToro's 3.81 million [9] [10].

The comparison changes against the brokers eToro actually resembles. IG Group, CMC Markets, and Plus500 run the same principal-based, multi-asset retail model — market-making across CFDs, equities, and currencies — and here eToro is the leader by scale. IG Group booked £1,075.9 million of revenue (about $1.44 billion) against 820,000 active clients, a figure inflated by its Freetrade acquisition from 346,200 a year earlier; CMC Markets took £360.1 million (about $483 million) from roughly 336,000 active trading and investing clients [11] [12] [13]. eToro's 3.81 million funded accounts are several times the client base of any of them, and its Net Contribution exceeds each — though the CFD peers convert that revenue into higher margins and, unlike eToro, are constrained to a narrower, more leveraged product.

Sources: FY2025 filings — eToro 20-F [14]; Robinhood 10-K [15], [16]; Coinbase 10-K [17]; Interactive Brokers 10-K [18], [19]; IG Group [20]; CMC Markets [21], [22]. GBP converted at £1 = $1.34; account definitions differ by company (funded accounts, active clients, cleared accounts). Coinbase account figure is 9.2m monthly transacting users, not a comparable account stock; IBKR net income is omitted because its consolidated non-controlling-interest structure makes it non-comparable, and its pre-tax income was $4.77 billion.

The monetization gap

The account-count lead comes with a lower yield per account, and that is the more revealing comparison. eToro earned roughly $228 of Net Contribution per funded account in 2025 ($868 million over 3.81 million); Robinhood's own ARPU was $171 [23]. The CFD-centric brokers monetize a smaller base far harder: IG Group and CMC Markets generate on the order of $1,400–1,800 of revenue per active client, and Plus500 likewise runs a small, high-turnover CFD book whose clients are fewer, more active, and more leveraged than eToro's. eToro's economics sit at the mass-market, moderate-yield end of the spectrum — closer to Robinhood than to the leveraged-trading shops — which is the natural read of a platform whose median user is 37 and whose stated purpose is to widen access, not to concentrate turnover among whales [24].

Source: derived from FY2025 filings — eToro NC ÷ funded accounts [25], [26]; Robinhood ARPU as reported [27]; IG [28] and CMC [29] revenue ÷ active clients, GBP at $1.34. Account definitions differ (funded vs active vs cleared); figures are directional.

The moat: social investing and breadth

What eToro has that the field mostly does not is a two-sided social network built into the brokerage. Users can copy the trades of over 4,750 members of a vetted Pro Investor program, invest through 127 curated Smart Portfolios, and trade more than 150 cryptoassets alongside equities on 25 exchanges [30]. CopyTrader — patented and live since 2010 — is the mechanism: more people to copy attracts more copiers, and more copiers create the audience that makes becoming a Pro Investor worthwhile [31]. None of Robinhood, Coinbase, IG, CMC, or Plus500 operates a comparable copy-trading network at scale, and the engagement it produces is unusual: the average user logs in about four times a day for roughly twelve minutes, 92% of users' first action in 2025 was to invest or copy, and 53% of funded accounts hold more than one asset class [32].

Sources: FY2025 Annual Report (Form 20-F), Our Users and eToro Club [33], [34], [35].

The multi-asset breadth reinforces the social layer and does real work in the P&L. Because a user can hold equities, commodities, currencies, and crypto in one account, no single asset class dictates the relationship, and eToro argues this diversity gives it a more stable financial profile than a single-product broker [36]. The stickiness shows up in the eToro Club: 72% of Club members have held a funded account for three years or more, against 62% for non-members [37]. And the footprint is deliberately where the U.S. giants are weakest: 3.81 million funded accounts across 75 countries, with number-one or number-two brand awareness for trading in its seven key markets — the U.K., Europe, the UAE, and Australia among them [38].

That said, the moat has thin walls, and the disconfirming evidence is specific. Underlying account growth is slow and partly bought: net funded-account additions were about 0.3 million in 2025 and 0.4 million in 2024, and half of the 2024 gain came from the Spaceship acquisition rather than organic demand [39]. Switching costs in brokerage are low, and eToro concedes in its own risk factors that it competes with larger, better-capitalized rivals — Robinhood is adding social and crypto features and expanding into Europe, and low-cost neo-brokers undercut it on price — while the spread of spot crypto exchange-traded products could pull demand away from the direct crypto trading that swings its Net Contribution [40] [41]. The largest and deepest retail pool, the United States, remains largely closed to its CFD and full crypto offering, capping how much of that funded-account lead can compound.

The balance of evidence is that eToro's moat is real but bounded: CopyTrader and multi-asset breadth are a genuine, hard-to-copy differentiator that lifts engagement and retention, but they defend a mid-market, moderate-yield niche outside the U.S. rather than a structural cost or scale advantage over the giants. What would strengthen the read is organic funded-account growth reaccelerating without acquisitions and copied assets holding through a crypto drawdown; what would weaken it is a stall in net additions or Robinhood's international push eroding eToro's European brand lead. The niche is defensible at today's mid-teens multiple; it is not the kind of moat that would justify paying up.