eToro to Buy US Brokerage TradeZero for Up to $231M as Crypto Revenue Shrinks

eToro Group agreed to buy TradeZero, a U.S.-focused online brokerage for active traders, for up to $231 million in cash plus up to 2.5 million newly issued Class A shares, the Nasdaq-listed company said in a release filed with the U.S. Securities and Exchange Commission on Tuesday.

The purchase buys eToro regulated brokerage plumbing in two markets it wants to grow in. TradeZero Holding Corp. owns TradeZero America, a U.S. broker-dealer that has served U.S. clients since 2019, along with entities in the Bahamas, Canada and the Netherlands. Through those subsidiaries it offers commission-free stock trading, U.S. equities and equity options, and a proprietary short locator for traders borrowing hard-to-find shares.

eToro said TradeZero generated roughly $80 million in revenue in the twelve months ended June 30, with 81% gross margins in the second quarter, and that the deal should add to adjusted earnings per share in its first year after completion. Those figures and the accretion forecast are eToro's own disclosures rather than independently audited numbers, and the version of the release published on eToro's website applies the 81% margin to the full twelve months instead of the quarter.

Crypto Revenue Slides

The timing lands against a sharp contraction in eToro's crypto flow. Revenue from cryptoassets fell to $1.35 billion in the second quarter from $1.91 billion a year earlier, according to the company's quarterly release. Crypto trades on the platform totaled 1.4 million in July, down 73% year-over-year, with the amount invested per crypto trade down 50%.

Stock trading is filling the gap. Net trading income from equities, commodities and currencies rose to $141.6 million from $114.0 million, funded accounts grew 18% to 4.28 million, and net contribution increased 9% to $229 million, which eToro attributed primarily to increased equities trading activity.

"This combination gives us a faster path to launching new products for US customers and strengthens our offering," co-founder and Chief Executive Yoni Assia said. TradeZero co-founder and CEO Daniel Pipitone said eToro's user base gives his firm scale, while "our broker-dealer infrastructure and proprietary trading tools strengthen an even broader investing platform."

It is eToro's third acquisition signed in 2026, after it completed purchases of crypto wallet firm Zengo and exchange Bit2C in the second quarter. The company also said it recently received a U.S. registered investment adviser license through eToro USA Advisors Inc., letting it launch its Smart Portfolios product in the country.

Getting TradeZero itself will take longer. The deal is subject to customary closing conditions including requisite regulatory approvals, and eToro expects it to close during the first half of 2027 — a review that covers a broker-dealer with an enforcement record. In May 2022, the SEC charged TradeZero America and Pipitone with falsely telling customers the firm had not restricted purchases of meme stocks in January 2021. Without admitting or denying the findings, they consented to a cease-and-desist order, the retention of an independent compliance consultant, a $100,000 penalty for the firm and a $25,000 penalty for Pipitone.