EToro Acquires Zengo to Expand On-Chain Trading and Prediction Markets

Why It Matters

The acquisition gives eToro a secure, keyless wallet platform that can accelerate its entry into fast‑growing decentralized trading models, positioning the broker against rivals like Robinhood and MetaMask.

Key Takeaways

• eToro acquires Zengo to add non‑custodial wallet tech.
• Deal targets prediction markets, tokenized assets, and perpetual contracts.
• eToro’s AUM $17.6 bn, 3.9 m funded accounts.
• Robinhood’s prediction market unit trades $9 bn contracts, $300 m revenue run‑rate.
• Zengo’s keyless wallet uses multi‑party computation for security.

Pulse Analysis

eToro’s purchase of Zengo marks a decisive step toward integrating self‑custody solutions into a mainstream brokerage. Zengo’s keyless wallet, built on multi‑party computation cryptography, eliminates private‑key management while offering fiat on‑ramps, token swaps and staking. By embedding this technology, eToro can instantly provide its 3.9 million funded users with a non‑custodial gateway to on‑chain assets, reducing reliance on third‑party custodians and aligning with the firm’s public roadmap that emphasizes decentralized finance and prediction markets.

The broader market for prediction markets has exploded, with Robinhood’s unit processing over 9 billion contracts and approaching a $300 million annual revenue run‑rate. Competitors such as Kalshi, Crypto.com’s Fanatics Markets and Webull are also launching event‑based contracts, while wallet providers like Trust Wallet and MetaMask are adding market access. This surge reflects investor appetite for binary‑style products that blend traditional finance with blockchain transparency. eToro’s move positions it to capture a share of this revenue stream by offering native, on‑chain prediction contracts directly through its platform.

For eToro’s retail base, the Zengo integration promises a broader product menu, including yield‑generating DeFi services and perpetual contracts that can be settled on‑chain. The non‑custodial approach may also ease regulatory scrutiny, as user‑controlled assets shift risk away from the broker. As more U.S. states permit crypto trading, eToro can leverage its expanded footprint to attract traders seeking both conventional assets and innovative crypto derivatives. In the long term, the acquisition could accelerate the convergence of traditional brokerage services with decentralized finance ecosystems.

Deal Summary

eToro announced the acquisition of Israeli self‑custodial wallet maker Zengo, aiming to integrate Zengo’s non‑custodial technology into its platform to support tokenized assets, prediction markets and other decentralized trading models. Financial terms were not disclosed and the deal is subject to customary closing conditions. The move aligns with eToro’s strategy to broaden its crypto and on‑chain finance offerings.