How to Buy Bitcoin with PayPal

Let’s face it.

Bitcoin is becoming part of our collective identity. We keep hearing about it, and then one day, we discover that we must jump into the market.

You should probably step back and take a breath and then sleep on the idea. When you awaken, if you still feel that it is a rational decision, then why not go for it?

How to Buy Bitcoin with PayPal

Two ways to use PayPal to buy Bitcoin

Here’s the excellent news. You can now buy some Bitcoin using your PayPal. In fact, there is a couple of ways to purchase Bitcoin with PayPal.

The first method, and the most preferred one, is purchasing your cryptocurrencies straight through your PayPal account as you would with any order transaction.

The second method is to use your existing PayPal balance to purchase cryptocurrencies using a third-party provider. This option is a little more complex and not quite as convenient as the first one. One reason for this is that the number of third-party sites that will allow this is limited. So you’ll spend some time looking for one.

Cryptocurrencies that are PayPal friendly

For the most part, there are four cryptocurrencies that you can buy directly using your PayPal account. Those four cryptocurrencies are Bitcoin, LiteCoin, Ethereum, and Bitcoin Cash. Residents of every state but Hawaii can presently use their current PayPal accounts or set up one.

To establish a crypto account using PayPal, you will need to following pieces of info to get started. Those are your name, physical address, date of birth, and tax identification number.

Buying your Bitcoin

There are several ways in which to buy Bitcoin through PayPal accounts.

Here are a few of them:

  • The current balance in the PayPal account.
  • Using a debit card that is connected to your PayPal account.
  • Using a bank account that is connected to your PayPal account.

Unfortunately, you can’t use your credit card to buy Bitcoin through PayPal. During the processing of the purchase, PayPal displays a price. But because cryptocurrency prices can be volatile at times, those prices can change in a hurry. And of course, you need to ensure that you have ample funds in your account before making any purchases.

A few subtle costs

Anytime you buy Bitcoin directly through PayPal, it will make money from the spread of crypto price. This pertains to the difference between the current market price of Bitcoin and the exchange rate between the cryptocurrency and the USD.

Let us not forget that PayPal will also charge a transaction fee – as it does for every purchase. Of course, these fees will depend on the total amount of your purchase.

For example, a fixed fee of $0.50 is generally the cost for purchases that range from $100 to $200. Anything over $200 is subject to a percentage of the overall dollar amount.

Disadvantages of using PayPal to buy Bitcoin

One significant disadvantage of buying your cryptocurrencies using your PayPal account is that you’re not allowed to move the crypto out of the payment processor’s platform. This means you can’t transfer cryptocurrencies from your PayPal wallet to an external crypto wallet or even to your personal wallet.

Another disadvantage of using your PayPal account is not many exchanges, or online traders will accept them as a payment processor. As of this writing, eToro is one of the few online traders that will accept PayPal to buy Bitcoin on its platform.