Can You Use A Credit Card To Purchase Cryptocurrency?
According to the United States Congressional Research Service, there are over 5,000 different types of cryptocurrency in circulation, worth close to over 230 billion dollars, and the growth rate is exponential. Early on, cryptocurrency exchanges were trying to make it easier for new players to get into the game by accepting credit cards, but they are now pulling out of the sector and/or imposing restrictions. Cryptocurrency newbies are attracted to using credit cards for exchange transactions, believing that it offers them more security, but that simply isn’t true. The reality is that even though it’s possible to find an exchange that will accept credit cards to purchase cryptocurrency, there is simply no benefit to doing so, especially since ATM kiosks and margin accounts provide convenience with less downside than using credit cards to purchase cryptocurrency. PAYDEPOT is a worldwide leader in cryptocurrency technology with ATM’s in many convenient locations that accept debit cards and cash.
Drawbacks of Using Credit Cards To Purchase Cryptocurrency
The lion’s share of cryptocurrency online exchanges and ATM’s do not accept credit cards due to concerns about fraudulent transactions that will complicate their business. This limitation is combined with the fact that many of the credit card companies themselves do not allow the transactions. For example, Capital One has decided to prohibit them completely due to concerns about market volatility, fraud, and losses that impact the user’s ability to pay their bills. It’s clear that if you want to pay for cryptocurrency with credit cards, your choices will be limited for both the exchange and the cards you can use. When you find an exchange that takes a card you have, the transactions are likely to be treated as cash advances, rather than purchases. This means that you’ll be paying interest from the time of the transaction, without the typical 30 day grace period that usually applies to purchases. Many banks and credit card companies also charge higher interest rates and/or don’t apply cash advances to awards such as sky miles and apply transaction fees that can be 3% or higher for domestic or foreign transactions. If you’re thinking about using a credit card because you have a high spending limit, you may not have as much purchasing power as you think because cash advance limits are often much lower than purchase limits for credit cards.
For example, many customers with a purchase limit as high as $20,000, have cash advance limits as low as $2,000. An additional deterrent is that if you’re buying large amounts of cryptocurrency, your credit score can be impacted by high utilization, raising the interest rates you need to pay on mortgages and other types of loans. That’s why so many savvy crypto investors are using PAYDEPOT ATM’s that accept debit cards and cash.
What’s The Best Way To Buy Cryptocurrency
The best to buy cryptocurrency is to transfer money directly from your bank account with an ACH or wire transfer. Many online exchanges and crypto ATM’s offer the use of Paypal to expedite bank account transactions, providing an additional layer of security because you do not have to provide your bank information directly to the exchange. If your bank account has a line of credit attached, you can purchase more cryptocurrency than the cash you have available without many of the downsides of using a credit card. The interest rate for lines of credit are usually much lower than credit cards, and there are usually no additional fees. If you have good credit, asking your bank to set up a line of credit would help you take advantage of opportunities without using credit cards for purchases. Another way to purchase more cryptocurrency than the cash you have on hand is by establishing a margin account with an exchange. These accounts operate in a similar fashion to brokerage accounts, offering reasonable interest rates to encourage transactions and are becoming more popular in the cryptocurrency sphere. PAYDEPOT makes it convenient and easy to trade cryptocurrency, with ATM’s that accept cash and debit cards.
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