How to buy crypto with a credit card?

As crypto adoption and investment increase, more individuals want to learn how to buy crypto with a credit card. Crypto investors with over $1 million in crypto holdings have increased by 95% between 2023 and 2024. Consequently, Bitcoin billionaires have soared by 111% in the same period. This indicates the growing interest in crypto investment.

If you are interested in investing or trading in the booming crypto market, you may have wondered if you can buy crypto with your credit card. 

Well, yes you can. But here is what you need to know:

Buying Crypto with Your Credit Card

Most of the top crypto exchanges allow for crypto purchases through credit cards by setting up a credit card as a method of payment in your account with the exchange.

Although using credit cards to buy crypto may seem convenient, the transaction may be a little complex with a lot of factors to put into consideration. 

Notably, each crypto exchange has unique requirements around crypto purchases with credit cards. First, you need to confirm that the platform accepts your credit card, find out if the coin you would like to purchase can be bought with a credit card, and whether your credit card company allows for crypto purchase with the card. 

For instance, if you make a purchase with a card issued by Mastercard, it is highly possible that the purchase will be blocked.

How it works: buying Crypto with Your Credit Card

Each platform or exchange may have a slightly varying process for purchasing crypto using a credit card; however, the steps to expect can be summarized into:

• Register to open an account or log in: If you are getting on the platform/exchange for the first time, you may need to register and verify your identity before you can make purchases.

• Decide on the crypto you’d like to buy: Decide based on research your coin of choice and decide on the amount you’d like to invest. Then ensure you can purchase the chosen crypto coin with a credit card.

• Pick credit card payment as your method of payment: Using a credit card may require a verification process to complete your purchase. In some platforms, the process can take some days.

Advantages and Disadvantages of Buying Cryptocurrencies with a Credit Card

With crypto investment, you need to set aside sufficient time for research and educating yourself on your investment interests.

Advantages: easy, quick, secure

Quick: Credit cards provide a quick way to purchase crypto. Purchasing crypto with credit cards is almost instant, which can allow investors and traders to leverage market conditions without the hustle of waiting for bank transfers. Fast transactions are crucial in the volatile crypto market.

Convenient: The most popular reason for choosing credit card payment for crypto is convenience. Credit card payments are straightforward and easier, making it an attractive payment method when one is looking to purchase crypto as opposed to having to go through a bank transfer into an account before making a purchase. 

Secure: Credit card payments offer protection for your bank account. Often, it is advisable to use credit cards to buy crypto instead of bank transfers or debit cards. This is because credit cards are not linked to personal assets. In an environment that faces fraud and security issues, an extra security advantage is worth consideration.

Concerns when Using Credit Cards for Crypto Purchase

Transaction fees: Crypto exchanges charge various fees for each transaction; between 1% to 2% transaction fees. However, when you prefer credit card payment, there is an additional fee for credit card processing which can be as high as about 3.75%. Additionally, you may be charged transaction fees by your credit card issuer. This means your total fees may go way beyond 5%.

Notably, some platforms offer much lower fees by design. One such platform that allows for crypto purchases with credit cards at the lowest fees in the market is SOPHIE. 

High APR: with a credit card, an interest charge could be attached to the crypto purchases you make. The average APR on credit cards is about 19% and can go as high as twice the average percentage depending on your credit card issuer. Additionally, you’ll have to consider that:

• With creditors, transaction fees can be as high as 5%

• Promotional APR offers may not apply to crypto purchase

• There is no grace period for interest charging.

Crypto Exchanges that Allow You to Buy Cryptocurrency Using Credit Cards

• Binance

• Coinbase

• Etoro

• Crypto.com

• Kraken

Ramp solutions that allow crypto purchases with credit cards:

• ramp, 

• Moonpay (Uniswap)

• Sophie.fi

Platforms that Do not Allow Credit Cards for Crypto Purchases

• Gemini

• BlockFi

Banks and Credit Card issuers on Crypto Purchase

Most card issuers will not allow you to buy crypto using their credit cards. A suggested way of circumventing this is by taking a cash advance using the card. Then, buying crypto with the cash. However, this beats the convenience which is usually the main reason for using credit cards.

Credit card providers and banks that do not allow users to purchase crypto with the credit cards include:

• Capital One

• Bank of America

• Chase

• Barclays

• Discover

• Wells Fargo

• Citibank

• TD Bank

Fortunately, so card issuers allow for crypto purchases with their credit cards. One such popular credit card issuer is American Express. Cards issued by the company allow users to purchase crypto. But, you may encounter very high fees when buying crypto. Additionally, many crypto vendors don't accept payment through American Express. Notably, SOPHIE and crypto.com accept American Express cards.

Here are a couple of alternatives to buying crypto with a credit card.

Debit cards

Using a debit card to buy crypto is a great alternative to buying crypto with credit cards. This is because debit cards tend to have much fewer restrictions on crypto purchases compared to credit cards. 

Typically, the process of buying crypto using debit cards is similar to the process outlined above for buying crypto with credit cards. Except, on the payment method step, you choose a debit card instead of a credit card.

Most experts advise investors to use debit cards for crypto payments instead of credit cards because the transaction fees may be lower and interest charges can be avoided.

Most crypto exchanges that allow for crypto purchases with credit cards also allow for purchases with debit cards.

Bank transfers

Most crypto exchanges make it possible to transfer fiat from your bank account to purchase cryptocurrency. This is possible through the deposit feature, which allows you to deposit money into your account within the exchange from your bank.

It is advisable to research and get familiar with the fees and charges that may be incurred with the transfer. Some exchanges allow for the deposit to happen for free. You can then move the funds to your trading wallet and exchange them for the cryptocurrency you have chosen to buy.

Here is a summary of how to do a bank transfer:

• Go to Deposit page

• Choose the method available for you (bank, PayPal, Apple Pay, Google Pay)

• Enter the exact amount you’d like to transfer to your account in the exchange platform

• Click Proceed

If some verification steps are required, go through them and confirm receipt. In most cases, the process is instant. The transfer can also take 1 or more business days to reach your account in some exchanges.

Conclusion

You can easily use your credit card to buy crypto instantly from most of the top crypto investment platforms and crypto exchanges. Research helps you decide on the best exchange to transact in according to your card issuer restrictions, the fees charged, and the crypto of choice.

Currently, the best platform for crypto investment, which helps with achieving the highest yields and interest in the crypto market is SOPHIE. It could be a great place to start. Even better, it accepts credit card payments.

Sophie allows you to easily buy a basket of cryptocurrencies and hold them yourself, ensuring simplicity, security, and performance.