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How to Buy Cryptocurrency with a Credit Card (And Should You?)

Posted March 18, 2019 by EasyFinance.com to Investing 0 0

If you want to know how to buy cryptocurrency with a credit card, this is the guide for you. But is it the right decision to make? Read on to find out.

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We've all heard the stories, right?

A friend of a friend invested $3000 in bitcoin back in 2010 and now they're worth $25 million.

You've probably thought to yourself "I want a piece of that life."

If you want to know how to buy cryptocurrency with a credit card, this is the guide for you.

But is it the right decision to make?

Read on to find out.

How to Buy Cryptocurrency with a Credit Card

First thing's first, you will need to sign up with a digital currency exchange broker.

There are loads of these around, such as PaybisCoinbase, Kraken, or Trezor. These sites store your cryptocurrency safely in an encrypted digital wallet and allow you to buy and sell currency securely using your chosen site as a broker.

Your other alternative is to trade cryptocurrency as you would any other product or service. This is done in an OTC, or over-the-counter trade, but it carries additional risk and should be carefully evaluated before being considered.

Can It Actually Be Done?

In short, yes.

In long... eeeeh.

The problem lies with a number of major credit card companies. In early 2018, giants like JPMorgan, Bank of America and Citigroup Inc. halted the purchase of cryptocurrency using credit cards. They deem the investment too risky to finance.

Coinbase, a digital currency broker recently posted a similar update on their blog. They posted in their blog that they have disabled adding new credit cards as a payment method for U.S. customers.

In essence, there is a clamp down on trading money you don't have.

But, it's not all bad news. At the time of writing, some digital wallet sites like Coinmama still offer the option to buy using a credit card.

But how about your credit score?

Lexington Law posted an article in 2018 detailing the potential impact on your credit score.

In summary, the only impact it will have on credit scores is that using cryptocurrency will not help to build positive credit like paying a credit card on time every month would.

If you're at all unsure, consider getting your credit score checked before proceeding.

What Are My Options?

So it can be done, and your credit score seems safe, but what are your options when it comes to purchasing cryptocurrencies?

In mid-2018 the Telegraph posted an article on the 10 most popular cryptocurrencies, with other outlets publishing similar rankings.

Here is the list.

  • Bitcoin

  • Bitcoin Cash

  • Litecoin

  • Dogecoin (not a joke)

  • Ethereum

  • BAT

  • NEO

  • Ripple

  • Stellar

  • Cardano

Bitdegree has produced a detailed article on the historical performance of each of the major cryptocurrencies.

There is a host of other crypto trading exchange platform currently in circulation, such as IOTA or EOS, all of which might warrant research if you are serious about investing.

Should I Do It?

There is some speculation about the nature of cryptocurrency. Is it actually a currency or is it purely an investment tool?

For a currency to stabilize properly it needs to be used as a currency. This presents another issue, as the list of commercial retailers that currently accept cryptocurrencies as a payment method is rather short.

The Bottom Dollar

Now you know how to buy cryptocurrency with a credit card, as well as what to look out for if you do.

With the price of cryptocurrencies recently dropping substantially, the market currently favors the buyer.

However, the question remains: Will it ever be a seller's market again?

Do you have any other financial questions? Want to know more?

Why not take control of your finances by checking out our blog or by getting in touch for more info.

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