E*TRADE offers indirect exposure to the cryptocurrency markets through investments related to the industry. However, until the regulatory future of cryptocurrency is more concrete, E*TRADE has chosen to forgo offering direct access to cryptocurrency trading on its platform. For more comprehensive access to crypto, consider an established cryptocurrency exchange, such as Binance or Coinbase.
As blockchain technology and cryptocurrencies like bitcoin become increasingly mainstream, more and more people are looking for ways to convert their cash into digital assets. Some brokers offer direct access to bitcoin trading by allowing their traders to buy crypto through their respective platforms. But not every established broker allows traders full access to the cryptocurrency market.
The electronic trading platform E*TRADE does offer traders indirect exposure to some digital currencies. The access is via more traditional investments currently supported by their business. These include stocks and futures contracts like those found at other traditional brokers, such as TD Ameritrade.
How common is cryptocurrency trading?
The cryptocurrency market extends far beyond the price of bitcoins and tweets urging you to buy dogecoin. Although the price of bitcoins is usually what makes headlines, there are literally thousands of different digital currencies on platforms across the globe. Unlike stocks in the stock market, crypto can be traded 24 hours a day, 7 days a week, 365 days a year. Check out our cryptocurrency guide to learn more about how these currencies work.
What is available on E*TRADE
E*TRADE could have likely added cryptocurrency trading to its financial services when bitcoin’s market cap was lower. But other factors, including regulatory uncertainty, have prevented E*TRADE and brokers like it from adding bitcoin trading to their full suite of services. There are a variety of publicly traded companies that are directly related to the crypto industry, though.
If traders on E*TRADE would like a broad exposure to cryptocurrency, the digital currency broker, Coinbase, can be found under the ticker COIN. Coinbase’s stock can be found on E*TRADE along with most other popular brokers.
More direct exposure
If an individual would like a more direct exposure to well-known cryptocurrencies like bitcoin, E*TRADE does offer several futures products created by the Chicago Mercantile Exchange. In March 2022, the Chicago Mercantile Exchange expanded its bitcoin derivatives offerings to include a micro-bitcoin futures option representing 1/10 of a bitcoin. However, account holders must use the Power E*TRADE platform to trade futures contracts with E*TRADE.
For a broader general exposure
If an investor isn’t interested in futures or other such transactions, there are still a plethora of traditional stock and ETF trades available to those with an E*TRADE account. For example, the ARK Innovation fund is an ETF managed by Cathie Wood which has holdings in multiple crypto-related businesses, with Coinbase being one of the most notable. The ARK Innovation fund can be found under the ticker ARKK and is available from most of the largest securities brokerages, including E*TRADE.
Some brokers do offer direct cryptocurrency trading
Several major brokers do allow direct trades in digital currencies. For example, both Webull and Robinhood allow users to invest in various coins from their normal brokerage accounts. They both offer a limited variety of popular cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, and a few others. The table below includes some of the leading brokerages that offer cryptocurrencies.
How trading digital currency differs from stock and ETF trades
Since many of the largest securities brokerages do not offer direct access to digital currencies, investors who choose to use a crypto exchange should remember that most cryptocurrency transactions typically involve much higher fees than traditional securities have now. Many popular online brokers like E*TRADE and TD Ameritrade offer the ability to buy and sell stocks at no cost to the trader. But cryptocurrency exchanges like Coinbase typically charge a percentage-based fee that is applied to the entire value of the transaction.
Traders need to remember that cryptocurrency transaction fees often vary greatly, according to one disclaimer on the Coinbase website. Users will only be informed of their exact fee breakdown immediately before making a trade. However, if an investor wants to invest in other more obscure coins, those fees must be considered part of the cost of doing business.
Despite the platform’s higher trading fees, there are several positive reasons why investors might choose to use Coinbase. For a person familiar with crypto trading, opening an account on the Coinbase platform will allow an investor to trade a much wider variety of digital currency options. Alternatively, if a person is less knowledgeable about crypto, Coinbase provides many brief but informative videos about specific cryptocurrencies for educational purposes.
- E*TRADE investors who want exposure to digital currency trading have multiple investment options on the E*TRADE platform related to the industry. They can invest in crypto futures but cannot invest in digital coins directly.
- Investors with access to traditional markets have choices, including futures, ETFs, and conventional stock trades.
- For direct exposure to specific cryptocurrencies, users will need to consider a platform that provides access to them. Consider We Bull, Robinhood, or a dedicated crypto exchange such as Coinbase.
- For more comprehensive access to crypto, Coinbase would be a reliable platform for new investors. However, exchanges like Coinbase typically have higher fees than traders might be familiar with when coming from more traditional trading platforms.