There are so many ways to buy Bitcoin. But some ways are definitely safer, anonymous, and cost-effective. This article is focused on the top ways to buy bitcoin with the lowest fees while keeping safety and other important factors in mind.
LocalBitcoins is the cheapest peer-to-peer way of buying bitcoin. It is one of the oldest exchanges. LocalBitcoins allows you to buy bitcoin directly from other people in your local area. Although it is not just limited to your local area. There are no fees associated with buyers. Sellers pay a small fee for their ads. Sometimes you may even find people selling bitcoin for a price lower than the current market price of bitcoin. But, usually, sellers mark up the price to sell at a profit.
LocalBitcoins is hands down the best option if you are looking to buy bitcoin with multiple payment methods. But this comes with a great cost. Scammers! LocalBitcoins is the favorite of scammers. While no fees and multiple payment methods are a great advantage of LocalBitcoins, charge-backs by scammers is a big risk factor here.
As mentioned previously, LocalBitcoins allows you to buy Bitcoin with almost any major payment method. This includes but not limited to PayPal, national bank transfer, cash, and gift cards. If you are planning on buying bitcoin with PayPal, keep in mind that sellers usually charge a higher fee for PayPal. If you want to get the best price, your best option is national bank transfer or cash deposits.
One great thing about LocalBitcoins is that you do not need to verify your identity before buying bitcoin. Just signing up is sufficient. LocalBitcoins is the best way to buy bitcoins if you value anonymity. While LocalBitcoins doesn’t ask for your ID, some sellers may request your ID, especially if you are buying a large sum of bitcoin.
In terms of delivery, it is not the fastest. Some sellers may take hours to release your bought bitcoin while others release instantly. Bitcoin is held in escrow while the seller verifies payment and releases bitcoin; so you do not need to worry about seller running away with your money.
Coinbase is very newbie-friendly. It is made for people who do not have much knowledge about bitcoin and cryptocurrency. Bitcoin is based in San Francisco. Supports 30+ countries. Coinbase is one of the well-known platforms that allows users to buy bitcoin using fiat currency.
Coinbase allows you to buy bitcoin with a credit/debit card or bank transfer. Coinbase doesn’t provide multiple payment methods like LocalBitcoins but offers a few methods depending on your country. Coinbase doesn’t charge a fee when you deposit money to your account but charges a fee when you purchase bitcoin.
- For bank transfers, Coinbase charges 1.49% of the total amount of bitcoin you bought.
- 3.99% fee when you buy bitcoin with a credit or debit card.
If you add a backup payment method, you are able to use Coinbase’s instant buy feature which allows you to buy bitcoin up to $1000 a week.
Tip: Use Coinbase’s exchange, GDAX to lower the fees. It is a little complex than buying bitcoin using Coinbase but worth the time and effort.
Privacy of Coinbase
To buy bitcoin using Coinbase, you need to become a verified member. Coinbase requires a lot of personal details. In terms of privacy, Coinbase is not the best option. Once you become fully verified, Coinbase allows you to buy a very large amount of bitcoins up to $50, 000 daily.
Coinbase has never been hacked so far. It has a great safety reputation. The majority of funds are stored offline so you can rest assured that your funds are safe.
Dangers of Coinbase
Remaining anonymous is impossible with Coinbase when you provide so many personal details. Coinbase is known to provide IRS with your personal details so you can be taxed one day for purchasing bitcoin.
Be careful when you buy things with bitcoin. Coinbase tracks your transactions and may freeze your funds without any notice. As for convenience, Coinbase is a great choice but if you want to stay anonymous, you may want to look for other methods.
Just like Coinbase, CEX is another broker exchange. You can buy bitcoin using fiat currency. CEX provides its service to a majority of countries but restricts to few. You can purchase bitcoin using credit/debit cards or bank transfers and SEPA transfers (if you live in the EU).
- When you buy bitcoin using a credit/debit card, CEX charges a fee of 2.99%.
- For bank transfers, CEX charges no fee.
With CEX, you are able to sell your bitcoin as well. They provide different levels of verification. Each verification level you pass, you are rewarded with higher buying limits. The most basic verification level requires very little information from you and enables you to buy $400 worth of bitcoin daily and a limit of $2000 monthly. Unfortunately, bank transfers are not enabled for you at the basic level. Once you are fully verified, you are able to buy an unlimited amount of bitcoins.
In terms of delivery, your credit/debit card purchases are processed very quickly.
Just like Coinbase, CEX has its own trading platform. You can lower the fees if you use CEX’s trading platform rather than using the brokerage platform. Currently, CEX’s brokerage platform supports:
Bitcoin, Bitcoin Cash, Bitcoin Gold, Ethereum, Ripple, Stellar, Dash and Zcash.
Binance is one of the top cryptocurrency exchanges in the world. It is popular for its low fees, user-friendliness and great customer service. Now you can buy cryptocurrency with a credit/debit card. It has partnered with Simplex to make this possible. Right now you can buy Bitcoin, Ethereum, Litecoin and Ripple on Binance. As for the fees, they charge 3.5% of the transaction amount or a flat $10 fee (Whichever is higher). You are limited to buy up to $20,000 worth of bitcoins daily and up to $50,000 monthly.
In terms of fees, Binance is not the cheapest but I would surely use this exchange for its user-friendliness and good reputation.
Changelly supports buying bitcoin and multiple cryptocurrencies. At this time Changelly supports over 130+ cryptocurrencies. You can even buy cryptocurrencies with cryptocurrency. The goal of this exchange is to place the lowest bid to get the best deal for your cryptocurrency.
Changelly charges a fee of 0.5% of your total transaction. There are limitations when it comes to buying cryptocurrency with Changelly. If you are in the US, Canada or Australia, you are limited to buy up to $50 in your first transaction. After 4 days, you can buy up to $100 and after 7 days, you can buy up to $500. No more limitations after one month. You can learn about Changelly restrictions here.
Be aware that if you buy cryptocurrencies with any currency other than USD or EUR, your bank may charge a conversion fee. Changelly supports USD and EUR only. Your local currency will be first converted to USD or EUR, and then to BTC. Contact your bank to know your exact conversion fee.
If you are wondering, how to buy bitcoin with low fees, these are your best options. In terms of anonymity, LocalBitcoins is your friend. Coinbase, Binance, Changelly, and CEX if you value convenience higher than anonymity.