How to Buy Bitcoin with a Credit Card

Although there are better options, credit cards can be a useful way to buy bitcoin. We have compiled a comprehensive guide to help you buy Bitcoin with a Credit Card. While there are better options, credit cards can be a useful option to purchase bitcoin. We have created a comprehensive guide to help you buy Bitcoin with a credit card. Credit cards were first used to describe a card that can be used for spending in 1887. This was mentioned several times in the futuristic science fiction novel “Looking Backward” written by Edward Bellamy. Although the original concept of credit cards was slightly different than today’s, and didn’t include borrowing money from authorities, they have been around for almost 150 years. It is used for convenience, but many people use it to buy goods and services that they cannot afford without incurring debt. People who don’t have the right money management skills will end up in financial trouble in the long-term. Credit card users who aren’t able to pay their debts on time could find themselves in serious financial trouble. People will continue to spend money they don’t have. Many bitcoiners would argue, sarcastically or not, that a credit card’s only useful utility is to buy more Bitcoin. Joke or not. You should be aware of all the trade-offs involved when using a credit card for bitcoin purchases. The transaction costs might not be worth the extra cost. This article will discuss the pros and cons of using a credit to buy bitcoin. It also discusses whether there is an alternative. Pros and Cons of Using a Card to Buy Bitcoin Speed: You can buy bitcoin with your credit card if the bitcoin exchange allows it. While bank transfers may take up to two days to be processed, the purchase is instant with a credit card.Funds: Credit cards are an easy way to purchase bitcoin; however, you’re entering into debt with a financial institution and you should consider that the interest rates and fees involved for the transaction might be very high.Rewards: You can accrue credit card rewards such as cash back, travel points or miles if your provider allows it with cryptocurrency.Cons:Debt: When you purchase goods or services with a credit card, other than high transaction fees, you are also entering a debt with a bank or a financial institution and agreeing to pay interest rates that could be very high.Cash advance: Think of cash withdrawals from an ATM with a credit card: they are more costly than debit cards. The card issuer may consider payment with a card to purchase bitcoin a cash advance. This means that you will be charged interest for the remainder of your monthly credit card bill. You might also lose a grace period of 21 days. Rewards: Your card issuer won’t likely offer rewards for crypto purchases. KYC: Card issuers heavily apply “Know your Customer” procedures to bitcoin purchases. High fees: You might have to pay a lot of fees for buying bitcoin with your credit card. This could depend on where you live and what credit card provider you use. The next section will provide details about the fees that must be considered for both your credit card provider as well as the exchange you use to purchase bitcoin. These fees can make a big difference in your final bill if you buy bitcoin with a card. Credit card issuers view bitcoin purchases as cash advances and not regular purchases. Cash advance fees can be as high as 35% of the transaction amount. Cash advance interest rate: The APR on the interest can be very high, often exceeding 25%. It starts accruing from the day you buy bitcoin and ends when you pay off the credit card. This is in contrast with regular card purchase interest rates that start getting charged after a period of three to four weeks, depending on the card provider.Cryptocurrency Exchange FeesWhile most cryptocurrency exchanges and brokers will let you buy bitcoin with a credit card, you should not take it for granted. Due to the chargeback time limit, many Bitcoin services won’t accept credit card purchases. It can take up to six months to complete a credit card transaction. Here are the fees for services that allow you to purchase bitcoin with your credit card. For example, U.S. cardholders may have to pay the exchange a commission fee of around 3% for buying bitcoin with a credit card.Foreign exchange fee: If the exchange is based outside of your jurisdiction, you might have to pay a foreign exchange fee of typically 3%.NamePlatformLimitsFeesBitstampCrypto Exchange$20,000 per month, $5,000 or ?5,000 per day 5% when depositing fiat currencies or buying instantly with credit cardByBitCrypto Exchange$10,000/transaction1.1% in EU, between 2.7% and 3.05% in non-EU countriesCoingateBroker$20,000/transaction8%CashAppBitcoin App$10,000/week3%CoinbaseCrypto Exchange$3,000/day (U.S. only)3.99%CoinmamaBroker$15,000 per month, $5,000 per dayBetween 4.9% and 5.9% fee with a credit cardBinanceCrypto ExchangeUp to EUR5,000 per day and up to EUR75,000 worth of BTC per month3.5% fees per transaction or $10BitpandaBrokerVerified accounts are allowed EUR2,500/day and EUR300,000/month1.49%PaybisCrypto Exchange$20,000/week$50,000/monthNo fee on the first transaction. Not clear after.CEX.ioCrypto ExchangeNo daily, weekly or monthly limits2.99% to 3.99 + service charge; 1.49%How To Buy Bitcoin With a Credit card Before you can connect your credit card to an exchange or broker account, you will need to open an account with the service provider. You will also need to verify your identification method (usually a passport or driver’s license). Below are the steps you should follow to buy bitcoin using a credit card. Sign up: Most platforms will require that you complete KYC procedures and verify your identity. You can only buy bitcoin with a credit or debit card if you have completed KYC procedures. You can set the amount you wish to buy immediately: Some platforms require that you use your credit card to purchase fiat currency. Some platforms will allow you deposit directly into your private wallet using a credit card purchase. You should check with the exchange to see what options they offer and ensure you have a wallet address ready for the purchase. Click “Buy with credit cards” and choose the option. Click “buy” and follow the instructions. Undoubtedly, purchasing bitcoin with a credit card offers the best convenience. Still, if you can take your time, you should consider alternatives like bank transfers and even gift cards, prepaid cards and cash if you want to buy bitcoin anonymously.Frequently Asked QuestionsHow long does a credit card bitcoin transaction take to complete? It can take anywhere from 30 minutes to several hours depending on the credit card issuer. However, it could take up to 12 hours if additional information is needed by the financial company. Is it safe to purchase bitcoin with credit cards? It is safe to buy bitcoin with credit cards. However, that balance can be filled with a credit card instantly, giving you a chance to buy bitcoin immediately after.ConclusionRegular purchases of bitcoin should not be executed with a credit card. If you are in a rush to buy bitcoin or if it is your first time buying, it should be a one-off transaction. It’s a convenient way for you to make a transaction. You can also buy bitcoin even without having the cash. Despite its advantages, they outweigh the benefits, as you may have seen in this article. We recommend that you explore all options and choose the one that is most suitable for your needs. Bitcoin Magazine guides offer a wealth of information that will help you make more money while keeping your identity and data private.

 

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