With the cryptocurrency boom well underway, everyone wants to get involved with a piece of the action. Knowing where to start can be a little tricky and many would-be investors are not sure how to go about getting their hands on cryptocurrencies.
You will be glad to know that there are many different ways of purchasing coins, many of which do not include having to be in possession of a coin such as Bitcoin.
If you want to buy cryptocurrency with fiat money, this article is for you. First up we will look at preparing to store your currency- a vital step in the process- and then we will provide information on different ways of purchasing with Euros and Dollars, such as credit card, debit card, bank and wire transfer, Paypal, and even eWallet.
So starting at the beginning, let us get going.
Table of contents:
Setting Up Your Wallet
First things first, if you are going to get involved in purchasing cryptocurrency, then you need to make sure that you have a designated and specialist cryptocurrency wallet. One of the best on the market that offers the most security is the Ledger Nano S hardware wallet.
A hardware wallet is one that is not connected to the internet and is basically completely impenetrable from hackers and spyware meaning that your cryptocoins are completely safe.
The Ledger Nano S is a wallet that is compatible with Bitcoin, Ethereum, and other Altcoins and it offers a range of robust safety features to keep your coins under lock and key. Retailing at around €80 it is a great entry level wallet that gives its more expensive counterparts a run for their money.
It connects to your computer via USB and it offers a secure OLED display which enables you to confirm and check each transaction using the buttons on the device itself.
It also offers double seed verification and a backup facility meaning you can recover your funds in the event of a technical hitch. Setting up the Nano couldn’t be easier and you can be up and running in a few minutes.
First of all, when you switch on the device you need to make sure that the firmware is up to date- this can be done in around 15 minutes.
Secondly, you need to connect your nano to the computer and closely follow the instructions that are embedded on the small screen. You have the option to set up a new wallet or import an existing Bitcoin or Ethereum account.
Then you will be asked to select a pin code and then confirm it- be sure to remember it as three successive wrong entries will reset your nano. Next, you need to copy the 24 words supplied in the box, onto the Recovery Sheet. This is an important step as it will ensure that you are able to recover your wallet in case of loss or theft. Be sure to keep your Recovery Sheet in a safe and secure place.
Once the ledger notifies you that the device is ready, you next need to install the Ledger Apps on your computer. Using Chrome, download the free Ledger Wallet Bitcoin Chrome application or the Ledger Wallet Ethereum Chrome App- installations take seconds and all upgrades are free. Once you have carefully followed and completed these steps, your Nano is ready to be used.
Buy Cryptocurrency With Fiat Money Using Paypal
Buying cryptocurrency with Paypal is easier said than done and finding a reputable platform that will enable you to purchase your cryptocurrencies with fiat currency, via Paypal is a bit of a challenge.
The reason Paypal make it hard for crypto enthusiasts to buy their currency on the platform is that there have been a large number of cases where scammers have bought Bitcoin with Paypal and then claimed that they have not received anything. This way, the scammers not only get their Bitcoin, but they also get their fiat currency back as well.
The easiest way to buy crypto with Paypal is through eToro. The platform gives you the chance to buy Bitcoin but you are unable to withdraw them or send them to others, you can only then sell them for fiat currencies.
This means that it is a method suited to those that want to benefit from the price fluctuations of the coin against fiat currencies and it is only a valid method for those that live outside of the USA.
Another option is to use Virwox. This platform has been around for quite a while but there are high fees associated with using it. Virwox stands for The Virtual World Exchange and it uses a virtual currency called SSL which can be purchased using Paypal.
The SSL coins can then be exchanged for Bitcoin meaning you can, with another extra step, buy crypto with Paypal.
Buy Cryptocurrency With Fiat Money Using an eWallet
The popularity of eWallets is continuing to increase and there are several that are now giving users the option to purchase cryptocurrency via their wallet platforms. One such example is Revolut.
Revolut is billed as a digital banking alternative and it provides customers with an e-wallet that holds various currencies at once, as well as a pre-paid debit card (VISA or MasterCard). It also offers currency exchange, insurance, and free transfers cross-border and in a number of world currencies.
They charge no fees for their services and use interbank exchange rates for their currency exchange during weekdays. The mobile-based application also gives its users instant access to Bitcoin, Litecoin, and Ether as well as the ability to purchase them using 25 fiat currencies.
Once they have been purchased, however, they are unable to be transferred to any other wallet and must be kept with Revolut.
The company launched in 2015 with the aim of “building a fair and frictionless platform to use and manage money around the world”. Through the removal of hidden fees and by offering interbank currency rates, they are amassing something of an international cult following.
When you purchase cryptocurrency on the platform there are no hidden fees, no subscription fees, no exit fees, and they only charge a small 1.5% markup on the average exchange price. Set up and transactions are executed in a matter of moments, and they even offer analytics of your performance, as well as detailed price histories of the relevant coins.
You can even pay your contacts in cryptocurrency or even receive payments in cryptocurrency with just a couple of taps on your mobile.
Buy Cryptocurrency With Fiat Money Using Wire Transfer
If you want to purchase your cryptocurrencies via a wire transfer, there are a few options available to you.
Bitfinex (currently the world’s largest crypto exchange) both offer the ability to purchase cryptocurrencies via wire transfer, but there are some other possibilities as well.
Bitquick is one of the fastest ways to buy and sell BTC and they support wire transfers with a range of currencies. There are no deposit or withdrawal fees and should you wish to trade, you are looking at a range of 0-2%.
You could also opt for Bitsquare which offers a wide selection of fiat and cryptocurrencies. There are no fees for deposits but it will cost you to withdraw. Trading fees, should you wish to do so are around 0.001-0.009%.
Bitstamp is another well-known name that has a great reputation and no fees on withdrawals or deposits. They enjoy high trading volume and liquidity and setting up a wire transfer is quick and pain-free. One other recommended site is Kraken which charges low fees and has an excellent level of liquidity in the EUR market.
Buy Cryptocurrency With Fiat Money Using Bank Transfer
Coinbase is a highly popular online platform that allows users to buy, sell, store, and manage their cryptocurrency. It is easy and straightforward to purchase a range of coins with a bank transfer, and you can choose from leading coins such as Bitcoin, Bitcoin Cash, Ethereum, and Litecoin.
With over 13 million users in 190 countries around the world, Coinbase accounts for a huge percentage of the trading market and has a sterling reputation.
If you are based in the EU you can use your bank account to transfer Euros to Coinbase and back again, using SEPA deposits. Coinbase also allows European residents to purchase cryptocurrencies with 3D secure enabled debit cards.
Initiating a deposit via your bank account is also pretty straightforward and stress-free and can be completed in just a few moments.
Once you have signed up and logged in, all you need to do is select the Accounts section of the website, choose the EUR wallet and then click on Deposit. Using the information provided on the site, you can initiate a SEPA transfer in Euros from your bank account.
Just be sure to include the provided reference number to ensure that the deposit you make is correctly associated with your Coinbase account.
If you are a customer in the UK, you will need to make an international SEPA transfer, otherwise, the IBAN number will show up as invalid as it will not be the correct length. It is worth noting that the funds will appear in the account 1-3 working days after they are sent and at no time may the balance of the wallet exceed EUR 30,000. Any funds that exceed this amount will be returned to the sender.
Also be aware that in order to deposit funds into Coinbase, you need to have verified your ID and phone number in the accounts section.
Just be sure that the deposit you send is in Euros as there is a different procedure to follow for US residents. To be able to make bank deposits from a US account, there are additional verification procedures that need to be undertaken, as well as the possibility of having to answer security questions and even enter your pin.
Transfers take around 2-3 business days and a little longer for withdrawals using this method.
Buy Cryptocurrency with fiat money using debit/credit card
If you want to use your credit or debit card to purchase cryptocurrency, then there are a couple of options available to you. Firstly you can use Coinbase (above) to do so, just follow the instructions on the site. If however, you want to use a different platform then there are a couple of other reputable options.
CoinMama is a good choice – with buying limits around $5000 a day and fees of 5% it is also available to users around the world. They have a solid reputation and there is no verification process to go through beforehand.
They also rate highly on their customer support which is quite rare to come across in the crypto world!
Alternatively, you can always opt for Cex.io. The fees vary depending on a number of factors and you are limited to purchases equivalent to €300 a day. It is available to customers in the US, Europe and South America and it offers both trading and brokerage services to all of its clients.
As you can see, for those wishing to purchase cryptocurrency with fiat currency, there is a wide range of methods available. From bank transfers and wire transfers to credit and debit cards, you can quickly and easily get your hands on crypto coins with just a few clicks.
However, if you want our final recommendation, we would use Coinbase as the first platform to buy BTC/ETH/LTC and then move to Bitfinex for altcoins and tokens. Both platforms have a solid reputation and their fees are quite attractive compared to others!
Read more about The Best Cryptocurrency Exchanges.