eToro Pays Up to $231 Million for TradeZero as Equities Offset a Crypto Slowdown
The retail-investing platform is buying U.S. brokerage infrastructure after quarterly profit rose, even as crypto activity weakened and investors questioned near-term spending.
eToro has agreed to acquire TradeZero for up to $231 million, pairing its global retail-investing platform with a U.S.-focused brokerage built for active stock and options traders. The announcement arrived alongside second-quarter results that showed stronger overall profitability but weaker crypto activity, clarifying why eToro wants a broader trading mix.
The consideration will include cash and as many as 2.5 million newly issued eToro Class A shares, subject to adjustments. TradeZero generated about $80 million of revenue and an 81% gross margin in the 12 months through June 2026. eToro expects the transaction to add to adjusted earnings per share in its first full year after completion, which is targeted for the first half of 2027 after regulatory approval.
TradeZero contributes more than customers. It brings U.S. broker-dealer infrastructure, proprietary tools for active traders and operating entities serving the United States, Canada and other markets. Those capabilities can shorten eToro's path to deeper equity and options participation in North America, where product breadth and execution features matter more than the social-investing proposition on which the company first built its brand.
The financial backdrop is mixed in a revealing way. eToro's net contribution rose 9% year over year to $229 million, net income increased 77% to $53 million and funded accounts climbed 18% to 4.28 million. Assets under administration reached $19.2 billion. Equities trading was the main contributor to growth, demonstrating that a multi-asset model can cushion weakness in one category.
Crypto was that weaker category. Gross crypto revenue fell to about $1.35 billion, roughly 30% below the prior-year period, according to the company and subsequent reporting. Gross revenue is not the same as net contribution because eToro pays costs associated with acquiring and hedging the underlying assets. Even so, the decline signals that a prolonged digital-asset downturn is reducing transaction activity and average trade sizes.
Investors focused on the near-term trade-off. eToro shares fell after the announcement despite adjusted earnings beating expectations. Reporting attributed the reaction to softer July trading indicators and higher marketing costs. The market response suggests shareholders see strategic logic in expansion but want evidence that acquisition spending and customer growth will translate into durable margins.
The company is simultaneously connecting traditional and on-chain finance. It completed acquisitions of wallet provider Zengo and Israeli crypto platform Bit2C, invested in an on-chain perpetual-futures venue and became a founding partner of Open USD. Its European money card also expanded during the quarter. TradeZero therefore fits a broader effort to become a financial account spanning savings, payments, stocks, options and digital assets.
Integration is the central risk. Active traders expect reliable execution, detailed tools and responsive support, while eToro's global platform emphasizes a simpler multi-asset experience. Combining the businesses without diluting TradeZero's specialist appeal will require disciplined product decisions. Regulatory approval, technology migration and issuance of new shares add further uncertainty.
Why it matters
The deal shows how crypto-native and multi-asset brokers are adapting as revenue cycles diverge. Rather than waiting for digital-asset volumes to recover, eToro is buying profitable brokerage infrastructure in a market where equity activity is already supporting results.
For the broader fintech sector, the transaction reinforces a consolidation thesis: distribution, licensing and execution technology are increasingly valuable together. The strongest platforms may be those able to move customers across asset classes without depending on a single trading boom.