In recent years, Bitcoin and other cryptocurrencies (like Ethereum and Litecoin) have dominated the news, which is why it comes as no surprise that you can easily buy Bitcoin with a bank account or bank transfer.
In 2015, 1 bitcoin was worth about $300. In November of 2021, it reached an all-time high, surpassing the $67,000 mark.
That’s a return of over 18,000% – a far higher figure than the 1% a high-yield CD will give you!
There is a lot to know about Bitcoin. While it can make you a lot of money, it can also lose you a lot of money. 2022 was a rough year for Bitcoin, as it fell as low as around $15,700.
It can make an excellent investment which is why it’s become such a hot ticket item. In 2023, it has been trending back up with a high of around $31,400.
Where To Buy Bitcoin With a Bank Account
Here are the top 6 platforms you can buy Bitcoin with a bank account or bank transfer:
Bitstamp is a global crypto exchange with operations in Luxembourg, the UK, and the US.
The platform offers an interface that’s easy to use, secure, and reliable with an Android and iOS app to buy and sell bitcoin on the go.
Bitstamp offers a tiered trading fee which depends on your trading volume over 30 days.
You can expect to pay 0.50% of your trading volume is less than $10,000. The more you trade, the lower the fee that you’ll have to pay.
If you’re looking to fund your account through your bank account, you can choose between ACH and wire transfers.
ACH deposits and withdrawals are free, while wire deposits incur a 0.05% charge and wire withdrawals incur a 0.1% fee. Minimum fees also apply, which are set at $7.50 and $25, respectively.
CEX is a Bitcoin exchange that offers a few different services under one roof.
While the company is registered in the UK, it is also registered as an MSB with the US Financial Crimes Enforcement Network.
You can deposit money in USD without having to pay any currency exchange fees.
You can transfer money to your CEX account directly from your bank account using SWIFT bank transfer.
There is a minimum deposit amount of $300, while the maximum amount you can deposit will depend on your user account.
If you want to withdraw back to your bank account, there is a fee equal to 0.3% of the amount you wish to transfer + $25.
There are also fees for depositing and withdrawing cryptocurrencies. The entire fee schedule is available on the company’s website.
CEX also allows you to use the bitcoins you have in your wallet as collateral for taking out loans. Loans start at seven days and can go on for a maximum of 1 year.
Coinbase is a platform that aims to make buying and selling Bitcoin easy and accessible for everyone.
They are present in over 100 countries and have over 43 million verified users. Coinbase is also currently running a promotion that can earn you $34 worth of Bitcoin while learning about different crypto aspects.
The platform accepts several payment methods, including bank accounts.
Here, you’ll be able to transfer money through ACH and can deposit, buy, sell, and withdraw funds. It can take up to 5 business days for the transactions to go through.
You can link your bank account directly to your Coinbase account, providing an easy way to transfer funds.
All you need to do is visit the Payment Methods page of your Coinbase profile and follow the provided instructions.
Coinmama is a cryptocurrency exchange through which you can change dollars to bitcoins and bitcoins to dollars.
You will need to register for a Coinmama account first. Once that’s done, you will need to get verified and then connect your wallet before buying bitcoins.
When you’re all set up, you can purchase bitcoins through your bank account by initiating a bank transfer.
All instructions on how to do so are available through your Coinmama profile.
You will need to choose SWIFT transfer and make the payment in GBP (Great Britain Pound), so you might encounter some currency exchange fees.
If you’re transferring less than $1,000, Coinmama will charge you the equivalent of £20, depending on the exchange rate at the time.
eToro is a bit of a unique platform in that it allows you to follow what others do. Using this platform, you can buy or sell Bitcoin simultaneously as others through what is known as social trading.
While it might seem like a good idea if you’re a beginner, remember Warren Buffet’s words, “It might seem easier to go through life as the echo-but only until the other guy plays a wrong note.”
eToro advertises itself as having 0% commission, but this does not mean that you do not pay them anything. They get a cut every time you buy or sell through what is known as the spread.
You can open an eToro account and use the demo method before transferring real money into your account.
Once you’re ready to buy Bitcoin, you can transfer money into your Bitcoin account using bank transfer, which will transfer money directly from your bank account.
It will take between 4 to 7 days for the money to reach your eToro account. You can also use bank transfer to withdraw money should you decide to sell your Bitcoin and cash out, with the money going straight into your bank account.
Kraken is a Bitcoin and other cryptocurrency exchange.
You can fund your account directly from your bank account using either SWIFT (wire transfer) or Fed’Wire.
Depending on your choice, the deposit minimum ranges from $1 to $150, and deposit fees from $0 to $10. Processing time can take up to 5 business days.
If you’re new to bitcoin trading, the website offers many resources to help you get started, even if you’re a complete beginner.
You can also download the Android or iOS app directly from the respective store to buy and sell Bitcoin on the go.
What Is Bitcoin?
Bitcoin is one of the most known cryptocurrencies available. It has dominated the news in recent years due to the astronomical gain in value over a short time.
It is called BTC in its shortened form. Cryptocurrency is a relatively new form of currency that is very different from the currencies we know – called fiat currencies.
Cryptocurrencies are a decentralized form of digital currency. They’re not managed by one single entity (like a central bank).
Instead, transactions are recorded on a distributed public ledger, making it safe and difficult to access or disrupt.
This ledger is made of blocks, tied together like a chain. That’s how the term blockchain was coined.
What Is A Bitcoin Wallet?
Traditional currencies, such as USD, are, generally speaking, tied to gold.
While the entire monetary system is more complicated than this, in a nutshell, the federal reserve has the entire worth of USD in gold equivalent, which gives money its value.
Cryptocurrencies, on the other hand, are not tied to gold. Instead, they are mined.
Mining is how computers solve mathematically complex puzzles to get new blocks – which once worked out are added to the blockchain.
This so-called mining requires a lot of computational power, with newer bitcoins requiring solving even more complex mathematical puzzles than the previous bitcoins.
How Much Bitcoin Can You Buy?
Generally speaking, you can buy as much Bitcoin as you like. As recently as February 2021, Tesla, the electric car company owned by Elon Musk, bought some $1.5 billion worth of bitcoin.
Of course, you don’t have to spend that much – you don’t even have to buy an entire Bitcoin and can purchase a tiny fraction of one.
As we said earlier, bitcoin is a very volatile currency – so proceed with caution when looking to invest in it.
As a general rule of thumb, it’s best not to buy more than you afford to lose.
Before You Buy Bitcoin
Due to the popularity of bitcoin, many companies offer services that allow you to buy bitcoin.
Generally speaking, you can buy any amount of bitcoin through a trading platform, exchange, and in some cases, even online banking.
Most companies will offer you many different ways to buy Bitcoin, including paying by debit card, credit card, bank transfer, or PayPal.
When choosing to buy Bitcoin with a bank account via a bank transfer, there are a few things that you need to know:
- Currency. Check if the brokerage platform operates in USD or another currency such as EUR (Euro). If it’s in a currency other than dollars, you might have to pay an exchange rate fee.
- Bank Transfer Method. Since many of these platforms operate on an international level, you will need to make sure they offer ACH or wire payments. Other bank transfer methods such as SEPA might not work in the US.
- Deposit Fees and Processing Time. Some platforms will charge you a fee for every bank transfer you make, depending on your chosen method. Processing time can also vary from instant to 5 business days
Pros & Cons
As with most investments, there are pros and cons. Knowing what they are will help you decide if it’s a suitable investment option for you.
- Volatile. While volatility can be a con, it can also be a pro if the price goes up. Historically, bitcoin has lost a lot of value. But it has also gained a lot of value which means that if you go in at the right time, you can make quite a substantial amount of money quickly. That said, you can also lose money – so some might say it’s a bit of a gamble.
- Decentralized. Because Bitcoin is decentralized, it is more secure as there is no single point of failure. It’s near impossible to hack or manipulate data to steal money.
- Volatile. One of the biggest, if not the biggest, disadvantages of Bitcoin is its volatility – the tendency for its value to fluctuate wildly over a short time. Because of this, many people shy away from buying bitcoins and other cryptocurrencies.
- Not legal tender. When you have a domestic currency, which in the United States is the US Dollar, you can go to virtually any shop or business and buy or pay for products and services. That’s because the dollar is legal tender (is recognized by law as a means of payment). Cryptocurrencies are not legal tender. While this does not take away anything from their value, it means they are not accepted everywhere.
How do I buy Bitcoin with a bank account instantly?
To buy crypto instantly with your bank account, log in to a crypto exchange and choose bank transfer as the payment option. You can expect to have any of the following options available:
- Faster Payments – This is only available to UK residents.
- SEPA Transfer – This is only available to EU residents.
- ACH Bank Transfers – This option is best for US residents.
What banks allow you to buy Bitcoin?
Several banks allow you to buy Bitcoin directly through them without setting up an account with a crypto exchange. Doing this can help you save time and have fewer websites to log in to buy Bitcoin.
How do I buy Bitcoin with a bank transfer?
If you’re a first-time Bitcoin buyer, you’ll need to create an account with an exchange or a brokerage once it’s set up, head to the payments section, and choose bank transfer to fund your account.
Can you buy Bitcoin without a wallet?
Yes, you can buy Bitcoin without a wallet. If you do, it’ll be held at the exchange or the bank you used to buy it.