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How to Buy Bitcoin with a Credit Card

By Evan Jones07/09/2024

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If you’re wondering how to buy Bitcoin with a credit card then you’re in the right place. We’re going to show you the best and easiest ways to buy Bitcoin with a credit card, and then break down the pros and cons of doing so. Then, we’ll show you the basic steps.

Buying Bitcoin with a credit card can be extremely easy, but there are caveats to it as a result. Whether buying through a crypto exchange, a payment/wallet platform, or a dedicated on-ramp, there are many ways to use your credit card to buy Bitcoin. Let’s jump in.

Best Ways to Buy Bitcoin with a Credit Card

Crypto Exchanges

Cryptocurrency exchanges are probably one of the easiest ways to buy Bitcoin with a credit card, and this is especially true if you’re already signed up for one. If you’re not already signed up for a crypto exchange, it may be easier to use one of the other options below. 

Regardless, crypto exchanges will allow you to buy Bitcoin with a credit card and then the BTC will be deposited into your trading account where you can do with it what you please.

Cash App

Cash App may be one of the most convenient ways to buy Bitcoin with a credit card because it doesn’t require you to do any extra steps, such as sign up for a crypto exchange. If you have a Cash App account already, then you can easily buy Bitcoin using your credit card on the app.

PayPal

PayPal has been getting more and more into the cryptocurrency sector, evidenced by their release of their own USD stablecoin PayPal USD (PYUSD). Apart from that, PayPal allows you to easily buy Bitcoin with any credit card you have on file, and it will be added to your PayPal account.

Fiat On-Ramps (MoonPay, BitPay, etc.)

There are a lot of payment providers that let you buy Bitcoin with a credit card and then send the BTC to the wallet address of your choice. Often when you’re buying Bitcoin with a credit card through a crypto exchange, they’re actually redirecting you to a platform such as MoonPay, or BitPay, who are the ones actually processing your credit card purchase. 

Shakepay

Shakepay is an option for Canadian users and they’ve been focused on Bitcoin since 2015. They’re one of the most convenient ways for Canadian users to buy Bitcoin with a credit card or with a bank transfer while also offering bonuses such as Shaking Sats where you can get a little bit of Bitcoin for free everyday.

Pros and Cons of Buying Bitcoin with a Credit Card

Pros

Instant Purchase

The biggest pro to buying Bitcoin with a credit card is that it’s essentially instant. Rather than having to transfer fiat to a platform in order to exchange it for Bitcoin, you can just buy it instantly using your credit card. Then the Bitcoin is available nearly instantly for you to do with as you wish.

Rewards

Reward will depend on the credit card you are using. Crypto and traditional credit cards tend to give you a good amount of cashback for purchases. But, whether those rewards are worthwhile will depend on the difference between the fees you’re paying for using a credit card and the rewards you get. It won’t be worth getting 2% cashback on your Bitcoin purchase if the fee for the purchase was 3%. See cons section below for more info.

Cons

Fees

While the instantaneousness of buying Bitcoin with a credit card is quite convenient, the fees they will incur are not. You’ll likely pay fees in excess of 3% for making a credit card purchase of Bitcoin, and that’s not even including the possible cash advance fees and other fees the credit card company could charge for the transaction. 

If you want to maximize the amount of Bitcoin you get for your money, then you should use a method other than your credit card. This will be a slower process where you have to transfer fiat or other crypto to an exchange, but it will save you a ton on fees, as trading fees for crypto exchanges such as Binance are 0.1% of the transaction, compared to the 3% plus with a credit card.

Bank Restrictions

The lack of regulation surrounding most cryptocurrencies including Bitcoin has made banking companies wary of purchases made using a credit card they issue. Some users try to file chargebacks when cryptocurrencies they buy drop in price, which is something credit card companies would like to avoid.

There may be a good chance that your bank has blocked Bitcoin purchases using their credit cards, and if so, you’ll need to find an alternative method. You may be able to make a Bitcoin purchase the first time you attempt to, but not on subsequent attempts as the bank will realize what the purchase was for.

Basic Steps for Buying Bitcoin with a Credit Card

Step 1: Choose a Platform

Before you can buy Bitcoin with your credit card you’ll need to decide where you’re going to do it. The two most important things to look for when choosing your platform are the fees for credit card Bitcoin purchases and that it is available to your jurisdiction.

Step 2: Register and Complete Identity Verification

Now that you’ve chosen the platform that fits your needs, you can register for it. This won’t take very long, likely just requiring you to verify your email or phone number. But in order to buy Bitcoin with a credit card you’ll have to complete identity verification. 

Even if it’s a crypto exchange that doesn’t require identity verification, when you go to buy Bitcoin with a credit card, you will then be required to complete identity verification.

The identity verification or Know Your Customer (KYC) process helps deter money laundering and terrorist funding through cryptocurrencies. You will have to prove your identity by providing information such as:

  • Your residential address
  • Proof of residence (government issued ID such as a passport or driver’s license)
  • Utility bill with address that matches address your provided
  • A selfie, possibly holding a piece of paper with a code or the website written on it, along with the date

After you enter all of this information, your identity should be verified within 24 hours, if not much sooner.

Step 3: Add Credit Card and Purchase Bitcoin

After you’ve registered and successfully completed your identity verification, you can purchase Bitcoin using your credit card. This is generally done through a “Buy Crypto” type button on a crypto exchange. 

You’ll then need to enter what fiat currency you want to buy in, and the amount of Bitcoin you want to buy. Some platforms allow you to set up a recurring buy. This means that you can set it up so that you buy X amount of Bitcoin every day, week, month, etc.

Final Thoughts

Buying Bitcoin with a credit card can be extremely convenient, but it’s also likely the most expensive way to do so. Unless you desperately need Bitcoin instantly, you’ll be better off using a slower method that incurs less fees. The same is true for buying any digital asset using a credit card.

On the other hand, if you’re looking to make a one-time purchase and acquire your first amount of Bitcoin, a credit card is a fine stop-gap. Just remember if you’re going to be making recurring purchases then you should look for a different method.

Article tags

Beginner
bitcoin
credit card
guide
Tutorial
Evan Jones

Author

Evan entered the crypto scene in 2017, attracted to the many disruptive possibilities that blockchain could have on current world systems. He has a keen interest in decentralized services, payment processing, and viable NFT use cases such as event ticketing. He spends his days writing with his dog Kobe under his feet, if not on his lap.

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