Create

Bitcoin

when

<p data-ct-non-breakable="true">One prevalent method for purchasing Bitcoin involves using a credit card. Buying Bitcoin (<a href="https://cointelegraph.com/bitcoin-price" rel="noopener noreferrer nofollow">BTC</a>) with a credit card is one of the fastest methods. Many major cryptocurrency exchanges, including Binance, Coinbase, OKX and MEXC, accept credit cards.&nbsp;</p>
<p>However, there are often additional fees to buy Bitcoin with a credit card, as well as <a href="https://cointelegraph.com/learn/what-is-kyc-and-why-do-crypto-exchanges-require-it" rel="noopener noreferrer nofollow">Know Your Customer (KYC)</a> checks to complete when first registering with a cryptocurrency exchange.</p>
<p>Additionally, not all credit card companies allow crypto purchases, with many credit card providers and banks usually limiting the value and frequency of cryptocurrency purchases.</p>
<h2 data-ct-non-breakable="true" id="why-buy-bitcoin-with-a-credit-card">Why buy Bitcoin with a credit card?</h2>
<p data-ct-non-breakable="true">There are several reasons to buy Bitcoin with a credit credit, including:</p>
<h3 data-ct-non-breakable="true" id="fast-and-safe-transactions">Fast and safe transactions</h3>
<p data-ct-non-breakable="true">Buying Bitcoin via a credit card is almost instant on major exchanges. It can be performed easily on a mobile device, allowing buyers and traders to quickly take advantage of market moves. In contrast, a bank account transfer might take several days to process, by which time the market and Bitcoin price may have changed.</p>
<p>Often, the <a href="https://cointelegraph.com/news/the-evolution-of-crypto-exchanges-what-s-next-for-the-industry" rel="noopener noreferrer nofollow">cryptocurrency exchanges</a> that accept credit cards are regulated and will use high levels of encryption. These exchanges will require KYC and <a href="https://cointelegraph.com/tags/aml" rel="noopener noreferrer nofollow">Anti-Money Laundering (AML)</a> checks for security and compliance. Although the checks don’t phase many cryptocurrency buyers, some <a href="https://cointelegraph.com/news/privacy-in-blockchain-and-crypto-is-a-major-concern-for-users-study-reveals" rel="noopener noreferrer nofollow">privacy</a> advocates in crypto might be reluctant to provide extensive personal information.</p>
<p>Purchasing Bitcoin with a credit card is a beginner-friendly option for <a href="https://cointelegraph.com/learn/what-is-a-cryptocurrency-a-beginners-guide-to-digital-money" rel="noopener noreferrer nofollow">new cryptocurrency investors</a> already familiar with using their credit cards for online transactions. There may be some protection from the credit card company if something goes awry.</p>
<p>It’s important to note that there may be no protection, depending on the scenario. A fraudulent transaction on a cryptocurrency exchange where the buyer doesn’t receive the Bitcoin could be a situation where a card company will investigate the transaction and consider a chargeback, although there is no guarantee.</p>
<h3 data-ct-non-breakable="true" id="straightforward-withdrawals">Straightforward withdrawals</h3>
<p data-ct-non-breakable="true">Bitcoin buyers who subsequently sell their assets can quickly withdraw fiat funds to their bank account or credit card using a cryptocurrency exchange, depending on the exchange’s policies, supported withdrawal methods, and the user’s geographical location.</p>
<p>Nevertheless, not all exchanges may allow direct credit card withdrawals, and the procedure can include fees, withdrawal limitations and verification requirements.</p>
<h3 data-ct-non-breakable="true" id="explore-dollar-cost-averaging-strategies">Explore dollar-cost averaging strategies</h3>
<p data-ct-non-breakable="true">A <a href="https://cointelegraph.com/news/what-is-dollar-cost-averaging-dca-and-how-does-it-work" rel="noopener noreferrer nofollow">dollar-cost averaging (DCA)</a> Bitcoin investment strategy involves buying BTC at fixed amounts at set intervals. Having a credit card saved on a cryptocurrency exchange for payment may make regularly executing this strategy simple in contrast to longer bank transfers.</p>
<p>However, using a credit card for a DCA strategy can have drawbacks. High transaction fees and potential interest charges on unpaid balances can erode investment returns.</p>
<p>Credit card spending limits may also restrict investment amounts, and not all exchanges support credit card withdrawals, complicating the reinvestment or withdrawal process. These factors can significantly impact the efficiency and cost-effectiveness of a DCA strategy when using credit cards.</p>
<h2 data-ct-non-breakable="true" id="what-are-the-drawbacks-of-buying-bitcoin-with-a-credit-card">What are the drawbacks of buying Bitcoin with a credit card?</h2>
<h3 data-ct-non-breakable="true" id="fees-for-credit-card-purchases">Fees for credit card purchases</h3>
<p data-ct-non-breakable="true">Buying Bitcoin with a credit card can be the most expensive method. Coinbase, for example, charges a 3.99% fee for credit card payments. Binance <a href="https://www.binance.com/en/blog/fiat/can-you-buy-cryptocurrency-with-a-credit-card-421499824684903691#:~:text=Transaction%20fees,and%20credit%20card%20provider's%20side." target="_blank" rel="noopener noreferrer nofollow">charges</a> around 2%. Other fees to pay on an exchange include transaction or spread fees. These fees will vary from exchange to exchange.</p>
<p>Additionally, crypto buyers must also be aware of the fees their credit card charges. Using a credit card to buy Bitcoin may incur cash advance fees (charges for cash withdrawals using a credit card), and cash advances can incur interest from day one.</p>
<p>Of course, if a credit card balance is not paid off within the card’s timeframe, the balance will incur interest charges. Depending on the location of the buyer and the exchange, using a credit card to buy Bitcoin may incur foreign transaction fees.</p>
<h3 data-ct-non-breakable="true" id="choice-of-cryptocurrency-exchanges">Choice of cryptocurrency exchanges</h3>
<p data-ct-non-breakable="true">Not all cryptocurrency exchanges accept credit cards to buy BTC and other cryptocurrencies, so this might limit a buyer’s choice.</p>
<h3 data-ct-non-breakable="true" id="data-security">Data security</h3>
<p data-ct-non-breakable="true">Major exchanges usually implement stringent cybersecurity practices to protect user data, but some exchanges don’t have such standards and can be less legitimate. <a href="https://cointelegraph.com/tags/hacks" rel="noopener noreferrer nofollow">Hacks</a>, cyberattacks and sketchy exchanges all expose customer and credit card data to illicit actors.</p>
<h3 data-ct-non-breakable="true" id="credit-score-and-finances">Credit score and finances</h3>
<p data-ct-non-breakable="true">One’s credit score may be badly impacted by high credit card utilization. High credit balances can damage credit scores, and there are further significant risks if a cardholder does not pay off a balance or monthly payments and otherwise falls behind with credit card bills or other personal finances.</p>
<h2 data-ct-non-breakable="true" id="how-to-buy-bitcoin-with-a-credit-card">How to buy Bitcoin with a credit card</h2>
<p data-ct-non-breakable="true">To understand how to purchase Bitcoin with a credit card, let’s use Binance exchange as an example. Please note that the steps involved in other exchanges will differ slightly depending on its user interface.</p>
<p>Step 1: Create and log in to the exchange.</p>
<p>Step 2: Navigate to the option to buy cryptocurrency.</p>
<p>Step 3: Select the card and fiat currency being used to fund the purchase and Bitcoin as the cryptocurrency to buy.</p>
<figure data-ct-non-breakable="true"><img src="https://s3.cointelegraph.com/uploads/2024-02/670bdbb4-cb98-421e-ab93-8bbd0cb775be.jpg" alt="" title="">
</figure>
<p data-ct-non-breakable="true">Step 4: Enter the fiat currency amount being spent. The amount of BTC in exchange for this amount should be auto-completed on the page. Prices can change during the time it takes to complete a transaction.</p>
<p>Step 5: The new credit card can be added using the “add new card” option for the fiat payment. The associated card address, expiry date and CVV code must be completed.</p>
<figure data-ct-non-breakable="true"><img src="https://s3.cointelegraph.com/uploads/2024-02/dfd5a70a-7e36-4f93-89c2-162d93e8c533.jpg" alt="" title="">
</figure>
<p data-ct-non-breakable="true">Step 6: Credit card users will be redirected to their card provider’s one-time password transaction page and must follow the instructions to confirm the payment.</p>
<h2 data-ct-non-breakable="true" id="alternative-methods-for-purchasing-bitcoin">Alternative methods for purchasing Bitcoin</h2>
<p data-ct-non-breakable="true">In addition to credit card purchases, there are other ways to buy Bitcoin. A popular choice is to buy Bitcoin via cryptocurrency exchanges, which let customers utilize various payment options like PayPal, bank transfers and even cash deposits.</p>
<p>Peer-to-peer networks facilitate individual-to-individual transactions by offering a range of payment options, including cash-in-person trades. Another straightforward option to buy Bitcoin with cash or debit cards is via <a href="https://cointelegraph.com/learn/bitcoin-atms-a-beginners-guide-to-bitcoin-teller-machines" rel="noopener noreferrer nofollow">Bitcoin ATMs</a>. Moreover, certain services allow users to purchase Bitcoin via prepaid cards or mobile payment apps.</p>
<p>Furthermore, wire transfers or automated clearing house transfers for Bitcoin purchases are made possible by cryptocurrency brokerage firms. Decentralized exchanges provide a <a href="https://cointelegraph.com/news/what-is-p2p-trading-and-how-does-it-work-in-peer-to-peer-crypto-exchanges" rel="noopener noreferrer nofollow">peer-to-peer trading</a> environment without intermediaries for individuals who value privacy.</p>
<p>Though each approach has pros and cons of its own, they all provide ways to obtain Bitcoin outside of conventional credit card transactions. Awareness of each option gives users the power to select the one that best suits their requirements and tastes.</p>

How to buy Bitcoin with a credit card

Table of Contents

Cointelegraph

Other articles published on Feb 10, 2024

Mina Protocol Advances with Testworld 2.0 and Mainnet Upgrade

5 Best Crypto Charting Software in 2024

Latest Report Shows XRPL NFT Mints Explode 491% in Q4 2023

200% SHIB Burn Rate and $25 Million Open Interest Surge Signal Investor Optimism

US Lawmakers take aim at crypto usage by Hamas

Thailand’s SEC takes legal action against former Zipmex CEO

Join our free newsletter for daily crypto updates!