eToro Plans to Acquire TradeZero as Q2 Crypto Revenue Drops 30%

eToro has outlined a new step in its push to broaden beyond crypto by announcing plans to acquire US online brokerage TradeZero. The deal is positioned as part of the company’s expansion strategy in the United States, with closing expected in the first half of 2026.

In parallel with the acquisition announcement, eToro’s second-quarter update showed crypto trading and revenues under pressure. The company reported $1.59 billion in total revenue for the quarter, with crypto assets contributing $1.34 billion—down roughly 30% from $1.9 billion in the prior-year comparable quarter. While crypto revenue fell, eToro also reported $1.35 billion in crypto-related cost of revenue and $19.7 million in net income from crypto assets, alongside $53.4 million in total net income.

Key takeaways

• eToro plans to acquire TradeZero to accelerate its US expansion, targeting closing in the first half of 2026.
• In Q2, crypto remained the largest revenue stream for eToro at $1.34 billion, but it fell about 30% year over year.
• Crypto net income was positive at $19.7 million for the quarter, even as overall crypto trades and invested amounts declined sharply in July.
• The company reported strong cross-asset engagement: many users who traded commodities later traded equities and then crypto on eToro.
• TradeZero reportedly generated about $80 million in revenue over the last 12 months ended June 30, 2026, with 81% gross margins.

Why eToro wants TradeZero in its US strategy

The acquisition of TradeZero is framed by eToro as a practical move to become a broader multi-asset platform in the United States. The focus on US brokerage capabilities comes as the firm works to deepen trading relationships across asset classes, rather than relying solely on digital-asset activity.

eToro also previously signaled similar intent in crypto infrastructure: in April, it announced plans to acquire self-custodial wallet provider Zengo. Taken together, the company’s approach appears to combine more traditional brokerage reach (through TradeZero) with continuing investment in crypto custody and user access (through Zengo).

Crypto performance remains the swing factor

Despite the company’s ongoing multi-asset push, crypto continues to dominate the revenue mix. In its second-quarter report, eToro said total revenue came in at $1.59 billion, down from $2 billion in the comparable 2025 period. Of that amount, $1.34 billion was revenue from crypto assets, which the company said was about 30% lower than $1.9 billion in Q2 2025.

eToro reported $1.35 billion in crypto-related cost of revenue and $19.7 million in net income from crypto assets. Total net income for the quarter was $53.4 million, indicating that losses or reductions in crypto activity did not fully translate into an overall earnings collapse—though the numbers highlight how sensitive the business remains to the direction of crypto volumes and fees.

The broader trading picture also weakened after the quarter. According to eToro’s disclosures, total cryptocurrency trades on the platform fell to 1.4 million in July, representing a 73% year-on-year decline. The invested amount was down 50% over the same period, reinforcing that reduced trading activity has been affecting both the number of transactions and the size of positions.

Cross-asset engagement and the commodities-to-crypto funnel

Alongside crypto-specific declines, eToro highlighted user behavior that could support its multi-asset thesis. In commentary attributed to its financial leadership, the company said that more than 60% of users who traded commodities during Q4 2025 to Q1 2026 later traded equities in Q2 2026. It added that nearly nine in ten of those users have also traded crypto on eToro.

This matters because it suggests eToro is attempting to build a funnel where initial engagement in one asset category can lead to additional trading across other categories. If TradeZero helps expand access to US equities and other traditional brokerage products, eToro may be betting that increased equity trading will feed back into crypto usage—offsetting parts of the volatility in digital-asset demand.

eToro also reported that equities and commodities-related trading generated $141 million in net income for the platform, providing another anchor outside crypto revenue even as crypto volumes cooled.

Deal economics: TradeZero’s margins and expected earnings impact

From the perspective of deal structure, eToro provided figures intended to show that TradeZero could strengthen the business rather than dilute it. The company stated that TradeZero generated about $80 million of revenue with 81% gross margins in the last 12 months ended June 30, 2026.

Looking ahead, eToro said it expects the acquisition to be accretive to adjusted earnings per share in the first year after closing. Closing is expected in the first half of 2026, meaning the earliest period for the claimed benefit would likely follow shortly thereafter.

Market reaction to the announcement appeared cautious. eToro’s Nasdaq-traded shares were down more than 5% in pre-market activity on Tuesday, with the move expected to extend Monday’s decline according to Yahoo Finance data for ETOR.

What to watch next

Investors and users will likely focus on whether the TradeZero acquisition helps stabilize revenues as crypto volumes fluctuate, and on whether eToro can translate its reported cross-asset engagement into sustained trading activity in the US. In the meantime, July’s sharp drop in crypto trades and invested amounts remains a key signal for how quickly digital-asset performance can change the company’s quarterly outlook.