Swipe to Invest: A Step-by-Step Guide to Buying Crypto with a Credit Card

Traditional Assets Have Failed to Keep Pace with Bitcoin’s Gains

For years now, traditional assets have failed to keep apace with bitcoin’s gains. The digital currency has increased in value by roughly 1,000% over the past five years, with some altcoins — or crypto assets other than bitcoin — having posted impressive gains while riding BTC’s coattails.

Purchase and Store Crypto

Investors can purchase and store crypto on a decentralized exchange with an external wallet, such as Best Wallet, or with a centralized platform and an internal wallet, such as Coinbase. However, you first need a funding source to buy crypto assets, and a credit card may be the right solution for you.

This Guide Will Explore Options for Buying Bitcoin and Other Cryptocurrencies with a Credit Card

This guide will explore some of the ways you can buy bitcoin and other cryptocurrencies with a credit card.

Open an Account with a Crypto Brokerage

Centralized crypto brokerages, such as Coinbase and Kraken, allow users to enter their credit card details and use the payment option to buy bitcoin and other crypto assets. You can then transfer the crypto into an external wallet or store your assets on the platform through native wallets.

While this route is relatively simple, it comes with one issue that may be a dealbreaker for some crypto enthusiasts. Since brokerage accounts require that you provide your ID and other details, you will lose your anonymity.

Importantly, even if you have an anonymous external wallet, you will lose your anonymity if you link it to a crypto brokerage account. If you don’t care about anonymity, a brokerage account makes it easy to build your crypto positions with a credit card. However, there are other strategies that let you remain anonymous when you buy crypto with a credit card, with the added benefit of using self-custody to avoid the risks of leaving crypto funds in centralized exchanges.

5 Steps for Buying Crypto with a Credit Card Using Best Wallet

Best Wallet makes it pretty straightforward to buy bitcoin and other cryptocurrencies with a credit card. You can follow these steps to get started.

Step 1: Download the Best Wallet App

Best Wallet is available via the App Store and Google Play. You will have to download the app and create a digital wallet before you can buy cryptocurrencies on the platform.

Step 2: Navigate to the “Buy” Section

Best Wallet offers a good user experience that makes it easy to find what you need. When you’re on the home screen, you can head over to the “Buy” section and choose your desired cryptocurrency.

Step 3: Enter the Amount

When you enter the dollar amount you want to purchase, Best Wallet will show you how much you will receive. For instance, if you invest $1,000 into bitcoin, you will receive a fractional bitcoin in return since the largest crypto by market cap is trading for more than $104,000.

Step 4: Provide Your Payment Method

Best Wallet will request your desired payment method before you make a crypto purchase. You can use this opportunity to enter the information on your credit card. Once you enter your credit card information, the details are saved into Best Wallet’s system, enabling more seamless crypto transactions in the future.

Step 5: Review and Place the Order

If you like everything that you see, you can place the order. Be aware that there can be transaction fees that vary depending on the platform you are using. Best Wallet, for example, charges a 3% transaction fee for buy orders.

Is It Worth It to Buy Crypto and Bitcoin with a Credit Card?

For some people, buying crypto with a credit card might be the only option. Doing so allows them to tap into their credit limit and buy more assets than they could with a debit card or a checking account.

However, buying crypto with a credit card is expensive compared to other payment options. Not only will you pay fees to the platform or digital wallet company, but your credit card issuer will also charge processing and cash advance fees that can get as high as 5% of the transaction’s amount.

If you tack on that 5% transaction fee with Best Wallet’s 3% transaction fee, your crypto needs to produce an 8% return just to break even. That doesn’t include any interest that your credit card debt will accumulate over time.

Additionally, regulations and card acceptance can vary by country. So it’s better for most people to buy crypto with a debit card or a checking account, rather than incurring debt to purchase investments. However, if you don’t mind the credit card’s extra fees and know you can pay off the balance by the end of the month, a credit card may be a feasible option.

More from Money:

Best Crypto Wallets
Best Bitcoin Mining Software
Best Crypto Exchanges
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