11 Differences Between eToro and Kraken

What are the differences between eToro and Kraken? Ideally, both Kraken and eToro differ in several aspects right from their place of origin to the trading instruments offered by them.

They even differ in the website design which is very evident since eToro does even mention on its welcome page that they allow crypto trading.

On the other hand, Kraken is all about crypto trading and its web page does not mention anything else other than that. This article deals with such differences and more about these two exchanges for your knowledge.

Both these platforms offer short positions and leveraged trading but that does not mean these two platforms are identical in all the aspects.

There are lots of differences between them and some of them are quite radical as well. This article compares the two platforms based on those specific aspects to make it easier to decide which among eToro and Kraken is best suited for your crypto trading needs.

Apart from the important features, in this article you will also find all of the small prints finely examined and compared so that you can have a much better sideways look at the two while making your choice.

Therefore, go through it and do not skip the ‘Which is better’ part of the article as well. Check out Differences Between eToro and Crypto.com.

11 Differences Between eToro and Kraken

Differences Between eToro and Kraken

While eToro has proved itself to be a reliable network to make social investments by connecting traders from all around the globe and sharing their experience, Kraken is one of the largest, oldest, and best exchanges to buy and sell crypto coins online.

However, that is not the only differentiating factor between these two crypto exchanges.

Here are a few other major and minor aspects that you should also focus on while choosing the one that is best for your crypto trading needs and preferences.

1. Overview

Kraken is one of the top and well-known crypto trading exchanges that offer ease in trading cryptocurrencies as well as a fairly good collection of Altcoins to choose from.

The spreads on this particular platform typically range from 0 to 2%, which is fairly low considering that of the other crypto platforms you would find today in the market. The eToro platform also allows margin trading.

On the other hand, the eToro platform is considered to be one of the best multi-asset platforms for trading with and investing in several financial instruments such as stocks, CFD, crypto assets, as well as forex.

This platform leads the way when it comes to crypto trading due to the fact that it has some of the lowest spreads, as low as 1% or less for BTC and 2% for ETH. In addition to that, this platform also offers cold storage and own wallet service but it does not support margin trading.

2. Minimums

When you consider the minimums of different aspects of these two platforms, it will also be easy for you to choose one among them. As for the deposit minimum, the requirement of eToro is $200 in general and $50 in the US. And, as for the minimum trade, the requirement of this platform is just $1.

The minimum deposit of Kraken is only 0.0001 XBT. On the other hand, the minimum trade requirement of this platform is 0.0002 XBT.

3. Payment Methods

You can make payments in any way you feel comfortable if you use the eToro platform since it supports multiple payment methods.

It includes Apple Pay, credit card, debit card JCB Card, BPAY, Diners Club, Sofort by Klarna, Neteller, PayPal, Skrill, Swift, Perfect Money, Rapid Transfer, UnionPay, Venmo, wire transfer, Yandex Money, Visa, and Webmoney.

In comparison, the diverse payment methods supported by Kraken are also quite a few but the number of it is not as many as that of eToro.

It includes Bitcoin Payments, PayID, Clear Junction, Silvergate Bank Transfer, Etana, wire transfer, as well as credit card and Apple Pay against a fee of 3.75% plus 0.75 Euros.

This platform also accepts cash transfers made in US, Canadian, and Australian dollars as well as in GBP, Euros, Yen and Swiss Francs.

4. Regulation

Both these crypto platforms are regulated and therefore you will have a complete peace of mind while trading on them. The eToro platform is regulated by the FCA in about 140 countries.

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In comparison, the Kraken platform is a bit more favored by the users because it is not only regulated by the FCA but it also follows the regulatory standards laid down by the FinCEN, AUSTRAC, FSA, and the FINTRAC.

This platform works under the license agreement with the US Money Service Business and AU Digital Currency Exchange.

5. Deposits and Withdrawals

As for the wallets, the eToro crypto wallet allows transferring a few specific types of crypto coins out of the platform. However, the problem with it is that it is a one-way outlet.

This means that you cannot transfer these assets from the wallet of eToro back into your account. The eToro platform is however pretty slow in performing especially when it comes to transferring assets into its wallet.

It typically takes a day for the crypto coins to appear in the wallet and when it comes to completing a withdrawal process it may take days often. This is in contradiction to the principle of blockchain technology.

On the other hand, Kraken being a truly crypto platform, transferring of crypto coins can be done easily, safely, quickly and directly in and out from the wallet.

You will not need to use cash for that which is unlike eToro which insists on using fiat money only. This means that such activities performed on the Kraken platform are not very expensive and would also not have any significant tax implications linked to it as well.

On the other hand, when it comes to withdrawing crypto assets from Kraken, you will have to pay for the standard network fees only.

6. Security and Reliability

Though security should not be a point of concern for the users of these two crypto exchange platforms since both are adequately safe and regulated organizations, reliability surely is.

Ideally, if you want a way into the trading page of eToro, you will have to furnish a few personal details such as your job, your income, and how much you wish to invest in along with your trading experience.

This is really asking for a bit too much and, most importantly, these are classified as trading data and not personal information!

As a matter of fact, you will typically not have to provide all this information if you want to use Kraken for trading crypto coins. That is a significant point of difference and therefore matters.

7. Insurance of Funds

For the US users of eToro, the cash funds are insured by the Federal Deposit Insurance Corporation or FDIC with coverage of up to $250,000.

However, whether this coverage includes all different types of financial instruments it supports or is it restricted to the crypto tokens or coins is not clear from what the website of eToro states.

Kraken, on the other hand, does not offer any insurance for the funds of the users held by it and therefore there is no such confusion.

8. KYC Requirements

Though both the platforms follow strict regulatory and security measures, the depth of personal information you need to furnish to eToro seems to be much greater in comparison to the requirements of Kraken.

The KYC conditions apply to the US customers and the platform strictly follows the local regulations that are applicable in each territory that they operate in.

Kraken, on the other hand, also sticks to the US Anti Money Laundering processes. This includes the Know Your Customer or KYC information. Your transaction limit will vary according to the level of information you provide the platform.

However, the basic information is quite enough to transfer and transact with more than you would really need. However, if you wish to trade with hundreds of thousands of US Dollars, you will surely need to furnish further personal and business information.

9. Live Chat Service  

The customer support provided by Kraken includes a live chat function. This function can be accessed at the bottom right corner of the support page. However, this service may not always be available.

As for eToro, it also offers a live chat service but it clearly mentions that this service is exclusive for the silver club members. Therefore, if you want to avail of this service, you will need to have a balance of at least 5000 dollars in your account.

10. Education

On the eToro web page, you will find a FAQ section that lists some of the basic questions. If you do not find your question listed in it, you can look for it in the search bar.

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In addition to that, there is also a guide that will tell you about all the different functions. Though a bit clunky, it is quite useful.

In contrast, the Kraken platform offers education to the users on all basic and usual topics that they can choose from.

Apart from that, the Kraken users are also allowed to submit a request if they do not find any particular topic or answers they are looking for. In fact, the web page of Kraken simply elucidates just about everything.

11. A Few Other Differences

These differences listed here may seem to be minor but these are in no way unimportant when it comes to differentiating between eToro and Kraken crypto exchanges.

While Kraken exchange was founded in 2011 to become one of the largest Bitcoin exchanges in the world in terms of liquidity and Euro volume, eToro was founded in 2007 and acts mainly as a multi-asset broker platform that also allows its users to trade crypto coins.

The headquarters of eToro is located in the United Kingdom while that of Kraken is in San Francisco, California.

As for the user base of Kraken, it is just a quarter of the total user base of eToro but that should not fool you into believing that eToro is much more competent than Kraken.

This is because the user base of eToro comprises all traders including stocks and forex but that of Kraken includes only the crypto users.

As for the trading volume, it is about 1.5 trillion a year but then, once again, it is across all products, whereas Kraken has a crypto-only trading volume of nearly a trillion, which is expected to cross it by the end of this year.

If you consider the accounts of the two platforms, while the eToro platform supports STP accounts and ECN accounts, Kraken is not known for such support.

The eToro platform also allows automating the trades via its Copy Trading feature. This will help you to follow your favorite traders and open and close your trades just as they do, and that too, automatically. This facility is not provided by Kraken to its users.

The Copy Trading feature of eToro will also offer you better trading signals, a benefit that the Kraken users are deprived of.

The eToro platform also supports social trading, an Islamic account, and USD account currencies, all of which are found lacking on the Kraken platform.

There is also a significant difference in the exchange fees of these two platforms. As for Kraken, the maker and taker fees are 0.16% and 0.26% respectively but on eToro these are 0.75% for both.

When it comes to the withdrawal fees, the Kraken platform charges 0.0005 BTC against 5 USD of eToro.

As for the availability of these two crypto exchange platforms in the US, all residents of the United States can use Kraken apart from those who are residing in New York and Washington.

In comparison, eToro is accessible in 42 states as of now and this platform is not accessible to those US citizens who do not reside in the US.

Which is Better – eToro and Kraken?

Apparently, it may seem that Kraken is much better than eToro being a crypto-only platform.

But then, eToro will offer you other benefits and features along with the basics. As a result, it is quite impossible to say which one is better than the other, just like that.

However, here are a few specific things that may help you in finding out a better crypto trading platform for you according to your needs.

Ideally, eToro can be considered as a conventional trading platform for the retail traders, whereas Kraken is a crypto trading platform that will meet all the needs of its aficionados.

In short, it can be said that, if you want a crypto-only platform, Kraken is best to go with.

In contrast, it is the experience of eToro in the field of trading services offered to the retail investors that have made it one of the best known and popular platforms for any average person to trade regular currencies, commodities and stocks.

Quite naturally, when it moved with the times and joined the crypto bandwagon, users believed that it would not be bad and certainly it has not been.

However, as for eToro, you will have to pay fees for making any deposit and withdrawal if you want to make any non-US Dollar transaction.

In addition to that, the platform also imposes a minimum transaction limit of $30 and a standard fee of $5 for withdrawals.

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Since the platform has no upper limits for withdrawals, the fees will be more if you withdraw more from eToro.

The eToro platform will offer more of a CFD or Contract for Difference service in which you do not even need to own the crypto asset ever.

All you have to do is put your bet (!) on which way a particular crypto asset will move.

Therefore, the eToro platform can be considered to be much more like a sportsbook rather than a crypto exchange where you place bets with the market makers.

However, if you look at the cost of trading on eToro, it is quite more than Kraken. This means that you should not believe blindly with the commission-less trading aspect as advertised by eToro.

What is even more, as it is said earlier, you can move only fiat money in and out of this exchange.

And, you should also keep in mind the fact that when you exchange crypto into dollars for withdrawing it will trigger a taxable event.

As for the Kraken platform, if you use it you can avoid the taxable events and even maintain the privacy of the transaction and the destination as well when you transfer your crypto coins to any external wallet.

However, both these platforms are quite easy to use with some little differences here and there in the user interface.

The layout is quite well and the look is quite professional with these intuitive user interfaces. Otherwise, both these crypto trading platforms are quite sleek which allows doing retail trades more conveniently.

Also, eToro takes pride in its unique Copy Trading function and a social trading platform, which, however, is considered to be very antithesis in terms of trading and an oxymoron by some traders.

They consider it to be adversarial, trying to make money from a trader at the other end which emphasizes the ‘Survival of the fittest’ and ‘Capitalism’ figure of speech.

If you use Kraken, instead, you will get all the necessary and relevant information that you need to trade your crypto coins in spite of the platform being considered to be a bit subdued in comparison to eToro in its advertising and marketing efforts.

The Kraken platform has everything in the right places which makes it easier for the users to navigate.

You will hardly need to use more than a couple of clicks to reach your desired page on the website. With a much better feel and a classier look, the Kraken platform inspires more confidence in the users.

Though the eToro platform offers a variety of financial instruments to trade with, when it comes to the selection of Altcoins, the range offered by it will typically not impress the connoisseurs. This is in spite of the fact that they have some of the big caps.

Also, eToro offers ‘Crosses.’ This will let the users make margin trades with their crypto coins against other tokens, coins, currencies, and commodities.

You will also be able to trade long or short, but then again, the spreads of this platform are really horrific, so much that it can make a professional crypto trader run a mile.

On the other hand, Kraken demonstrates its pedigree in crypto trading and choice offered with its impressive roster of coins.

It is much more varied and there are too many to mention in a single paragraph. You can indulge with the latest coins, NFT and DeFi related activities along with staking, margin trading and coin swaps when you use the Kraken platform especially.

Therefore, it can be said that comparing eToro and Kraken crypto trading platforms with one another is just like comparing apples and oranges.

Kraken is simply passionate about crypto trading while eToro is an overpriced market for ‘Everything financial’ that is intended to relieve an inexperienced consumer base of their hard-earned crypto trading profits.

Conclusion

All through this article, you could see how both Kraken and eToro are different in features and functionalities. This knowledge has surely helped you in choosing your favorite crypto trading exchange that will serve all your purposes.