6 ways to buy Bitcoin with PayPal

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Cryptocurrencies are a very popular speculation and trading commodity. The prices, especially the Bitcoin price, are rising once again and so is the demand. But how do you get Bitcoins and how can you pay for them safely? 

Nowadays, there are countless ways to buy cryptocurrencies. Several crypto trading platforms and exchanges make it possible to buy digital currencies with a wide variety of payment providers. PayPal is one of the most popular and sought-after options among them. The following post is a simple guide and introduces crypto exchanges that support PayPal payments so you can start buying Bitcoins and co. via PayPal.

Buying Bitcoins and other cryptocurrencies with Paypal.

There are more ways than ever to buy cryptocurrencies in 2022. Some trading platforms allow users to pay exclusively with debit and credit cards or via bank transfers. But there are now also quite a few platforms that allow you to buy Bitcoin and other cryptos with PayPal.

kryptoszene.de lists many platforms on its site where you can pay for cryptocurrencies with PayPal. Trading platforms that allow you to buy digital currencies via PayPal include: Plus500, Markets.com, ATFX, Xcoins, Cancoin, Cryptonit and Wirex. In this article, we will introduce you to the bitcoin trading platforms Coinbase, eToro, LocalBitcoins, XCoins and Paxful and show you how you can even buy bitcoins directly through PayPal.

Each platform and exchange has advantages and disadvantages when it comes to buying cryptocurrencies with PayPal. For example, some services, like certain peer-to-peer marketplaces, offer better privacy, and you don’t need identity verification to trade with PayPal.

Open a PayPal account and register on trading platform or a brokerage service.

To make your first cryptocurrency purchase through PayPal, you will obviously need a PayPal account. You can open a PayPal account here if you don’t already have one. You will also need to register with a trading platform or brokerage service that sells digital currencies like BTC, BCH, and ETH using PayPal. These include the ones presented here below.

In addition, you will also need a “cryptocurrency wallet” (wallet) that supports the digital asset you want to buy. Bitcoin.com or eToro wallets, for example, are a possible solution that allows you to store, send and receive both BTC and BCH.

Account verification and KYC procedures.

However, a number of the above-mentioned companies require account verification and KYC procedures such as the presentation of a photo ID or proof of residency.

 For this, in order to use PayPal, you need to submit identification documents to deposit money and select the PayPal option. For most platforms that require identification, you can simply link a PayPal account to the exchange once you have gone through the verification process.

What is the KYC process

KYC or KYC check is the mandatory process of identifying and verifying the identity of the customer when opening an account. In other words, banks must ensure that their customers are really who they say they are. Banks can refuse to open an account or terminate the business relationship if the customer does not meet the minimum KYC requirements.

Probably anonymity is not a big deal for people who want to use PayPal to buy cryptos because the PayPal system itself is not really anonymous or private. If ID verification is an issue, you can always use trading platforms such as Local.Bitcoin.com for more privacy.

With more than 260 million active PayPal users today, there are definitely a number of people who want to buy or sell digital currencies like Ethereum or Bitcoin cash using the payment service.

Have you ever bought digital currencies using PayPal? What other payment methods have you used? Let us know how you have used PayPal to buy cryptocurrencies in the comments section below.

1. buying bitcoin with PayPal via Coinbase.

advantages: Trusted platform, high limits.

Disadvantages: No direct purchase of PayPal funds.

Coinbase is one of the most trusted cryptocurrency exchanges in the world and only started accepting PayPal as a payment method in 2022. Unfortunately, Coinbase does not currently allow users to buy directly with their PayPal balance, but only through a debit card or bank account linked to their PayPal account. This is somewhat restrictive. 

On a positive note, the maximum daily limit is very high at €25,000 per day. The fees for using PayPal to make a debit card purchase on Coinbase are 4% of each trade, while bank deposits via PayPal cost 2.5%.

2. buy bitcoin with PayPal via eToro

advantages: Relatively low fees, a variety of payment methods accepted.

Disadvantages: Not available worldwide, withdrawal of profits in crypto is complicated.

The easiest way to buy bitcoin with PayPal would be through eToro, but only for a limited purpose. The platform does allow you to buy Bitcoins with PayPal, but withdrawing them to your wallet is very time-consuming and requires many steps. In other words, eToro is better for speculating on the bitcoin price than for actually buying bitcoin that you can use. If you just want to profit from price fluctuations and don’t need the actual Bitcoins, this is probably the easiest and cheapest way. However, if you need the actual Bitcoins to spend or send to another person, read on.  You don’t need a Bitcoin wallet if you use eToro to make money from speculation.

3. buy bitcoin with PayPal via LocalBitcoins

Advantages: A wide selection of sellers from all over the world

Disadvantages: High fees, the risk of being scammed.

LocalBitcoins, unlike eToro, is a marketplace where buyers and sellers interact directly. When you use LocalBitcoins, you are dealing with a real person. As for the fees, sellers usually charge a premium as they take a big risk of chargebacks from buyers. The advantage is that you usually receive your Bitcoins faster.

4. buy bitcoin with PayPal via xCoins.

Advantages: Proven method that has been around for a relatively long time.

Disadvantages: Unclear business model and high fees.

xCoins.io (not to be confused with xCoins.com) describes itself as a bitcoin lending service. Instead of selling you bitcoins, they borrow bitcoins. Whether this is a loan or a sale is not entirely clear and leaves room for interpretation.

 Here’s how it works: you (the buyer) come to the website and say you want to “borrow” some Bitcoins. After a brief identity verification, you are asked to deposit the USD equivalent of the amount you want to borrow + credit card/PayPal processing fees + a fixed amount that serves as the interest rate for the loan.

5. buy bitcoin with PayPal through Paxful.

Pros: Wide selection of sellers from all over the world.

Disadvantages: High exchange rate, the possibility of being scammed.

Paxful is a very similar platform to LocalBitcoins. It is a peer-to-peer marketplace where you can buy Bitcoin with almost anything (e.g. Skype credits, Amazon gift cards). The procedure to buy Bitcoins on Paxful is quite simple.

6. buy bitcoin directly through PayPal

Advantages: Low risk, high maximum limits.

Disadvantages: No withdrawal of coins to external wallets possible, currently only supported in the U.S.

In October 2020, PayPal introduced the direct purchase of Bitcoin (and three other cryptocurrencies) within PayPal’s digital wallet through a partnership with Paxos. This allows users to hold Bitcoins purchased through the service and use them to pay PayPal-backed merchants. 

At the time of writing, users cannot send or withdraw these coins to other accounts. However, this might change soon, as PayPal plans to allow withdrawals to third-party wallets in the future. It’s also worth noting that this option is currently only available to US users, with more countries to be added over time. The maximum amounts are $20,000 per month and $50,000 per year, while the fees vary between 1.5% and 2.3%, depending on the amount of the purchase.

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