eToro offers a wide range of cryptocurrency trading pairs. With so much development going on in the blockchain space, it can be hard to see through the hype and find the long-term winners. That’s why Benzinga has made it easy for you. Here are some of the best cryptocurrencies on eToro.
While you're here, check out our in-depth eToro review.
Bitcoin Versus Altcoins
Bitcoin was the 1st cryptocurrency to leverage blockchain technology. Blockchains are transparent, open networks controlled by thousands of people around the world known as miners. Decentralization is advantageous when governments and corporations are untrustworthy. From full-on corruption to the housing crisis to overinflation, there are a lot of applications where blockchains can do better.
Bitcoin aims to replace government-backed money as the global reserve currency. But that isn’t entirely helpful if you still have to rely on the same banks and governments to provide exchanges, loans and the rest of the financial system. Virtual currencies have different utilities for different people, but these digital assets have so many use cases that you need to determine which side of the aisle—if you will—you want to be on.
The end goal is to decentralize the entire financial system, allowing people around the world to interact freely and securely over the blockchain-powered internet. Blockchain startups are potentially some of the best investments of the next 50 years, but don’t expect them to go public via a stock offering. Instead, these companies opt to raise funds via a digital currency, which often becomes the required form of payment to interact with their protocols.
Best Cryptocurrencies on eToro
In 2017, altcoins were largely seen as a scam, fake financial assets, a medium of exchange with no happy ending. In fact, some people thought of them as only being used for illicit activities (think the now defunct Silk Road.) Now that the decentralized finance (DeFi) ecosystem is maturing, it’s more clear which projects are to be taken seriously and which aren’t. Here’s a list of 4 solid DeFi projects with cryptocurrencies available on eToro. Ledger technology easily shows and records these financial transactions, and transaction fees are truly your only worry.
- Ethereum (ETH): Bitcoin’s blockchain is single-purpose: Record transactions. Ethereum inventor, Vitalik Buterin, decided to take blockchain a step further with Ethereum, the 1st general purpose blockchain. Ethereum’s blockchain is effectively a virtual machine where “smart contracts” can be written to automate anything a developer can dream of. The majority of the DeFi industry is built on the Ethereum blockchain, making it the top pick on eToro.
- Uniswap (UNI): Uniswap is a decentralized exchange (DEX) built on the Ethereum blockchain. Uniswap allows users to provide liquidity for others to tap into. Users of the liquidity must pay a small fee to the liquidity providers, which incentivizes them to make the market. Uniswap is also known as an automated market maker or AMM for short. While Uniswap is not the only AMM on Ethereum, it was the 1st and continues to be the most-used protocol on the Ethereum blockchain.
- Maker (MKR): The Maker decentralized autonomous organization (DAO) was one of the first DeFi projects launched to the Ethereum mainnet. MakerDAO is controlled by the holders of its token, MKR. Maker is responsible for creation of the Dai stablecoin, which is entirely decentralized. Unlike USD Coin (USDC) or Tether, which are run by centralized entities, Dai maintains its peg via a decentralized protocol. Dai is the favorite stablecoin of DeFi users, especially with all of the ongoing chatter about Tether’s trustworthiness.
- Polygon (MATIC): Space on the Ethereum blockchain is limited and highly coveted and, therefore, very expensive. Polygon is a sidechain on Ethereum with its own consensus model. While this makes it less secure than the Ethereum mainnet, it’s so much cheaper that many users are willing to make the sacrifice. When the Polygon sidechain launched, a huge amount of money flowed from the Ethereum mainnet onto the Polygon chain. While it’s hard to say whether sidechains will still be useful when Layer 2 solutions come out, Polygon’s 1st-mover advantage as a sidechain and upcoming Layer 2 solution probably means it’s here to stay for the next couple of years. Polygon transactions are paid for using the MATIC token, with the price reflecting demand for the protocol.
Cryptocurrencies You’re Missing out on
eToro offers a great selection of cryptocurrencies, but there are still a few solid projects missing. Here’s a list of a few cryptocurrencies you might want to consider opening up another exchange account to get your hands on. To save you the work, Benzinga will also show you exactly where you can get them.
- Sushi (SUSHI): SushiSwap began as a fork of Uniswap created by the anonymous developer Chef Nomi. While Sushi originally seemed like a giant scam, it’s arc has caught many UNI diehards by surprise. Sushi now offers a suite of DeFi products that Uniswap doesn’t have. From Bento Boxes to the upcoming non-fungible token (NFT) platform, SushiSwap is a Swiss Army Knife of a DEX. The SushiSwap development team is clearly taking the challenge quite seriously. You can purchase SUSHI tokens on Coinbase.
- The Graph (GRT): Blockchains contain a serious amount of data, and finding the info you’re looking for currently requires a Ph.D in computer science or a centralized 3rd party like Etherscan. While Etherscan is a great tool, DeFi users want a decentralized application that can do the same thing. This is where The Graph comes in — it’s a decentralized blockchain indexing protocol. The main use case is in smart contracts and other decentralized protocols that require end-to-end decentralization. Searching for info via The Graph protocol costs GRT. Demand for this product, and therefore GRT, is likely to go up as the DeFi industry grows. GRT is also available on Coinbase.
- ERC-20 tokens
Store Your Crypto Safely
With all this value stored in crypto assets, it’s wise to take the proper precautions when storing your money. While eToro will hold your assets in a wallet it controls, the best practice is to move the funds to your own wallet. For long-term investments, a Ledger hardware wallet will make sure your private key never touches the web.
For funds dedicated to trading and spending, an internet-enable hot wallet is the way to go. There are a plethora of choices when it comes to hot wallets. For Ethereum tokens, MetaMask is the de facto choice for most users. However, if you want to keep Bitcoin, Cardano and other non-Ethereum assets at your fingertips, ZenGo’s mobile wallet is a great choice.
Cryptocurrency Price Movements
Cryptocurrency price movements happen quickly. Whether you’re watching the 1-minute candles or fast asleep, it’s smart to have a tool to track your total portfolio value across multiple chains. The best way to do this is with Crypto Pro, a portfolio tracker with notifications and full featured charts. The best part is that Crypto Pro is totally free.
Other Cryptocurrency Exchanges Available in the U.S.
For access to the widest selection of cryptocurrencies, you’ll want to open accounts with a variety of exchanges. As a U.S. resident, there are some restrictions on which exchanges you can and cannot use. Below are some of the best options, or check out the best cryptocurrency exchanges for a full featured list.
*Disclaimer: Investors should be aware that 76% of retail accounts lose money.