Have you heard that it’s difficult to get Bitcoin unless you mine it?
If you think it’s impossible to get Bitcoin without rigging your PC to do massive computations, you’re in for a surprise.
In 2018, it is now possible to purchase Bitcoin directly. From credit cards to bank transfers, from cash to PayPal – there is no shortage of payment methods for buying. But each method will have its associated inconveniences and strengths.
You need to consider speed to deposit, commissions, ease-of-use, degree of anonymity, fungibility, proximity, and security when choosing a deposit method.
Here is a summary table of the advantages/disadvantages for each payment method:
|Credit Card||High||Bad||Very fast||Easy|
|Bank Transfer||Very low||Bad||Slow||Easy/Medium|
|Work for it||No fees||Good||Slow||Hard|
You can also find out which of the top Bitcoin exchanges works with your preferred payment method.
With that said, let’s take a deeper dive into each payment method.
For buying large amounts of Bitcoin, you should choose to buy with a bank transfer on a reputable exchange. Fees are always lowest when you choose to transfer funds directly via SEPA (Europe) or Wire (US).
If you’re looking for faster purchases, credit cards will speed up the process. This is because deposits are verified instantly so the exchange can immediately release the cryptocurrency to you.
The downside is that credit card transactions entail fees of usually 3-5%, which make them inconvenient if you’re buying Bitcoin in bulk.
To set up a bank transfer, you’ll need your account number and the routing number of your bank. This last is also known as an ABA number, and is the first set on numbers on the bottom of a check.
If you don’t have a check handy, you can also usually find it on the footer of a bank’s website or on an FAQ page.
You’ll also need your account number to initiate a bank transfer. Unlike a routing number, this is private and should be kept so. You can find it in the second grouping of letters on a check, after the ABA number.
If that’s not an option, you can log into your bank account and find the number listed there.
It’s worth taking a minute and ensuring you’re using a secured and authentic version of an exchange when entering this information. You want to make sure the browser you’re using has a secured SSL connection with the server, represented by HTTPS in the URL.
Many browsers represent this with a seal of some sort. Google Chrome uses a green padlock.
Sites without HTTPS like this are often phishing sites. Although they appear to be the authentic site, your confidential information will be used and your bank accounts will be drained.
Why would you want to exchange PayPal for Bitcoin and vice versa?
The simple fact that PayPal is instant, ubiquitous, and quite convenient. Many people use it as their favorite payment processor. While using PayPal is great for small amounts, it tends to be pretty expensive.
If you’re going to buy more Bitcoin, you should focus on other payment methods (such as by credit card or bank transfer) for larger transactions. Credit card purchases are the simplest way. Fees are high, but generally not as high as when buying with PayPal.
You should also be aware that not many PayPal-to-Bitcoin exchanges exist, and therefore some places may take advantage of this. Be sure to understand the differences between a good and a bad crypto trading site before commiting your funds.
Read into the fine print and understand exactly what the fees and commissions are on the site you’re working with.
Use the following diagram to compare PayPal vs Credit Card for buying BTC.
As you can see, there are advantages and disadvantages to each, depending on your primary focus. It all depends on your priorities when buying Bitcoin.
If you’re looking for a method that doesn’t require a number of different cards and platforms, PayPal could be the way to go. It can be easier to transfer money since just about everyone has a PayPal account.
It’s also a little bit more secure since you won’t have to give up your card number.
On the downside, however, you’ll have to wait a while until the transfer goes through. You’ll also have to pay a much higher fee, and you’ll have limits on the total amount of cryptocurrency you can purchase per transaction.
Finally, you’ll probably struggle to find a site that has PayPal options, since few exchanges have PayPal capabilities.
Personally, I recommend against using PayPal to buy Bitcoin. Unless you can’t do a bank transfer or credit card purchase for some reason, you’re going to spend more money than you need to for the convenience of PayPal.
If this isn’t something you need, it probably isn’t worth the steep price needed to make a transfer like this go through.
Instead, look to another method to maximize the cryptocurrency you can buy.
While Bitcoin is a digital currency, there are two accepted ways to buy it with cash.
First, by using a Bitcoin ATM. It works like your bank’s ATM does when you deposit cash into your bank account. You put cash in, and it sends Bitcoins to your specified address.
A great site for this is Bitcoin ATM Radar, which shows you all the BTC ATMs in your area.
You should also note that not all Bitcoin ATMs are anonymous. Some do require ID for the transfer.
A second way to buy Bitcoin with cash is by meeting with a person and swapping your cash for their Bitcoins. Generally speaking, buying Bitcoins with cash guarantees the highest levels of anonymity.
Fees are higher than buying by bank transfer, but you can keep your ID secret and no one has to know who you are. Some people choose cash because they want to buy Bitcoin with no ID.
This can be a big advantage for some, but for large transactions this becomes inconvenient, risky, and even physically dangerous. Another downside is that you usually have to go to physical location to meet someone, rather than just being able to do it all online.
You can find people selling and buying Bitcoin in a number of places. Perhaps the most obvious place is the destination for all kinds of anonymous local transactions: Craigslist.
There are a number of Bitcoin traders there, but it can be difficult to tell how trustworthy someone is just from a Craigslist post.
You can also use a site like LocalBitcoins to find sellers. This is a great way to set up a trade since you’ll be able to tell whether the person you’re trading with is reliable based on their feedback on the site.
This is generally regarded as one of the more secure ways to buy Bitcoin in person, since it allows you to leverage the security of an in-person transaction with the features of a national list of sellers.
Did you know that it is actually possible to work for Bitcoin?
It’s really starting to kick off within the freelancing community. If you’re a graphic designer, web developer, artist, producer, or anything else that can be done remotely, then I highly recommend looking into working for Bitcoin.
The best industry to work in for Bitcoin is, no surprise, the cryptocurrency industry. But even if you’re not a developer, there are options you might be interested in.
Cryptocurrency companies need people with a variety of skill sets like writing, social media management, data entry, and graphic design.
A good place to find crypto jobs is through Coinality. You’ll be able to find tons of postings here that are paid for in cryptocurrency, so you won’t have to search for special positions or convince companies to pay you in Bitcoin.
If you’d like more up-to-date resources on where to find jobs that pay in coins, you can follow Coinality on Twitter, where they post constant updates on new opportunities.
You can also find other projects on the Jobs4Bitcoins subreddit.
Even if you don’t have a skill listed, you can leave a “for hire” post on the subreddit explaining your skills and expertise for cryptocurrency-paying employers to see.
A huge advantage of getting paid in Bitcoin is that there are no exchange fees, since your employer simply sends you his or her Bitcoins directly to your address.
Granted, this is not the fastest method, but you’ll be riding the first wave of trend-setting digital freelancers.
If you’re looking to buy Bitcoins, there is no one single way. There are lots of options today for purchasing Bitcoins using just about any payment method you prefer.
All you need to do is choose the best payment method that works for you. Consider which factors are most important to you. Some payment methods emphasize speed, others anonymity, and some ease of use.
From there, choose a site that accepts your payment method. You can buy Bitcoins relatively painlessly, no matter how you want to pay for them.
How will you start your Bitcoin investment?