Tips on buying crypto with a credit card in 2022

Nowadays, something new is created every day. The breakthrough in technology with the development of the Internet has changed many aspects of our lives. For example, the financial and economic spheres. Namely, the emergence of cryptocurrency as a separate method of payment. So today's topic is cryptocurrency, and how to buy it with a credit card.

How do I know if my credit card supports crypto?

You will only be able to buy crypto with your credit card if it supports “3D Secure”. You won't need to pre-fund your account to acquire cryptocurrency if you choose this payment method. 

Contact your credit/debit card issuer directly to see if your card supports 3D Secure, or just try adding it to your Coinbase account. If your card doesn't support it, you'll get an error notice. It is important to remember that this method is only suitable for Europe and the United Kingdom. For instance, the majority of significant U.S. credit card providers don’t let you buy crypto when others will make you pay the fee. If you struggle to deal with these problems and want to buy bitcoin with debit card with no trouble, read this article to the end to find the solutions. 

Credit cards are not accepted by certain major cryptocurrency exchanges, such as Coinbase. For example, Coinmama and CEX.io claim to take credit cards, but just Visa and Mastercard.

To begin purchasing cryptocurrency using a credit card, you'll need a credit card issuer and a crypto exchange that both accept it.

Things you have to bear in mind with crypto

Even though buying crypto with a credit card is a comfortable and reliable method for experts, the beginners have to remember a couple of steps:

Exchange fees

To trade dollars for Bitcoin or another cryptocurrency, a cryptocurrency exchange is likely to charge you a percentage of the transaction value. In addition to the exchange's service fee, you may be charged an extra cost if you fill your account using a credit card.

For example, the cryptocurrency exchange Coinmama charges a fee for each transaction, as is common. However, if you pay with a credit card, you'll be charged an extra 5%. A $100 credit-card fee would be applied to a $2000 purchase. To go back to even value, you'll need reasonable returns on your investment.

It is important to note that for cash advances, many credit cards charge a higher annual percentage rate than ordinary purchases.

The credit limit is reduced.

 A distinct cash advance credit limit, which is smaller than the total credit limit, is available on some credit cards.

The process of buying crypto in 3 steps

1. To create a card crypto wallet you need to check the card to see whether it supports cryptocurrency purchases and what costs it imposes. (For more information, see the cash-advance penalty section.)

2. Find a cryptocurrency exchange that accepts credit card purchases. Some of the bigger ones don't.

3. Input your credit card details and link the card to your exchange profile to fund your crypto account. It's comparable to the procedure of buying services or goods online and filling out the payment form at the checkout.

Advantages and Disadvantages of buying crypto with a card

Advantages

• If you don't have any cash, you can purchase cryptocurrency.
• The transaction might earn points or count toward a sign-up bonus if your credit card permits it – but many large ones don't.

Disadvantages

• Fees, a higher APR, and the loss of a grace period are all examples of cash-advance penalties. (See the preceding paragraph.)
• Fees are charged by the bitcoin exchange.
• If you don't pay off your credit card account in full each month, you'll be in debt.

• Your credit score will be affected.

• Scams or a foreign-exchange charge are a possibility.