If you want to know which is the cheapest way to buy Bitcoin, then you are in the right place. As the market expanded to new all-time highs in 2020 and early 2021, several investors are trying to get exposure to Bitcoin (BTC).
However, the goal is to enter at the cheapest possible way. It seems rather difficult for BTC to come back to previous levels close to $4,000, at least now. This is why knowing which is the cheapest way to buy Bitcoin could be very useful.
There is not a platform that would offer you Bitcoin for a cheaper price than others. The market tends to sell BTC for a price that is defined according to supply and demand. Nevertheless, there are some ways to get access to cheaper Bitcoin. This would largely depend on the region you are and the demand and supply situation in your country.
Which is the Cheapest Way to Buy Bitcoin?
Bitcoin and cryptocurrencies can be acquired through a wide range of platforms. These platforms are known as cryptocurrency exchanges. These exchanges offer users the possibility to buy Bitcoin in just a few simple steps.
As you might already know, Bitcoin has a worldwide market. Cryptocurrencies expanded all over the world rather than in specific countries. This is why there are different platforms in different regions.
If you pay close attention, the price of Bitcoin will be different in each of these countries. The reason behind this is very simple. Each country has a different reality in terms of BTC supply and demand.
In some locations such as in South Africa, Nigeria, Argentina or Zimbabwe, the price of Bitcoin can be traded at a premium. This is because the demand for Bitcoin in these countries is higher. If you are in one of these locations, the cheapest way to buy Bitcoin with credit card is using foreign platforms.
Nonetheless, cryptocurrency exchanges charge fees for each trade on their platform. You should certainly understand which are those platforms with the lowest trading fees. Additionally, comparing them and their BTC price at the time of making your purchase is also a good idea.
Buy Bitcoin With Bank Transfer
Bank transfers are usually the cheapest ways to fund your exchange account and buy Bitcoin. This also applies to other cryptocurrencies. You would only need to have a cryptocurrency account open at any of the largest exchanges. Then, you will have to deposit funds by linking your bank account to the site.
This can be done in just a few simple steps. The transfer may take just a few days or even a few hours depending on the transfer method you select. Once you have your funds in local currency in your platform, you will be able to select a trading pair and acquire Bitcoin.
You should take into consideration that the bank transfer may have some fees. This is why you should closely analyse and understand which are the hidden fees. This method should then be compared to others to understand which is the cheapest way to buy Bitcoin.
Some of the platforms that support bank transfers include Coinbase, Binance and other local and smaller platforms. Everything will depend on the sites you use and the services you need the most.
Cheapest Way to Buy Bitcoin Using a Credit Card
When you think about the cheapest way to buy Bitcoin, you need to take into consideration the different commissions that would make your purchase more expensive. If you search for the cheapest way to buy Bitcoin using a credit card, you should know this has a commission.
Although the commission will change depending on the jurisdiction, you are starting at a higher price level. This is why the cheapest way to buy Bitcoin using a credit card is to search for the platform that offers an overall cheaper price for the digital asset.
Let’s use a clear example. If you have the possibility o buy Bitcoin using two platforms (A and B) you need to analyse the commission for processing credit card purchase. Furthermore, you will also have to know the price of BTC in each of these platforms.
If the commission for processing a credit card purchase is the same, then you would only have to pay attention to the price of BTC. This is an easy thing to do. However, things would become more complicated if the commissions are higher in one of the platforms.
If commissions and BTC price are the highest in one platform compared to the other, then you should buy where is cheaper. This is a clear strategy you should be implementing if you are searching for the cheapest way to buy bitcoin using a credit card.
Alternative Ways to Buy Cheap Bitcoins
The cheapest way to buy Bitcoin Reddit users are talking about is by waiting for exchange offers. Cryptocurrency exchanges are platforms that want to attract a large number of users. This is why they sometimes offer users with discounts.
Some of these discounts could be on the commissions they charge for some transfers. For example, it might be possible for you to deposit funds with a bank transfer without paying commissions. This would make your Bitcoin purchase cheaper. You should always be searching for these options offered by exchanges in order to buy cheap Bitcoins.
The same can happen with the commissions they charge on credit and debit card purchases. They want to welcome new users and they usually do these discounts. Use them on your favour. If you see this chance, you should definitely use it.
Stay far away from platforms that offer you direct credit or debit card purchases. They usually charge large commissions for users that want to get access to them. Although they are very simple and easy to use, commissions are also higher.
If you are searching for the cheapest way to buy Bitcoin, then this might not be the best option. Nevertheless, if you are a person that wants to have immediate access to BTC, this could be a great option. Some of these platforms include Changelly, Coinbase or Paxful, among others.
Buying Cheap Bitcoin Through ATMs
Bitcoin ATMs might not be the cheapest way to buy Bitcoin. Indeed, these are usually expensive platforms. This does not mean that Bitcoin is more expensive in BTC ATMs. However, they can be one of the best ways to get access to the cryptocurrency market with cash.
If you do not feel comfortable using cryptocurrency exchanges, using BTMs could be a solution. These are physical machines that look like traditional ATMs. They can be located in a wide range of places all over the world. In general, they are located in shopping centres, malls and crowded streets.
Although this is not the cheapest way to buy Bitcoin, it will certainly be very useful for you to get access to it. The platforms tend to charge between 3% and 12% for a BTC purchase. However, they are also a very good and easy way to get cash. Some of these BTMs are supporting cash withdrawals. Despite not being the cheapest way to buy Bitcoin they can certainly be very useful.
PayPal, Revolut and Robinhood Options
Another way to buy Bitcoin is by using PayPal, Revolut or Robinhood. Depending on the region you are located you would have one or more of these options available. PayPal has recently added support to cryptocurrency purchases. By paying a small fee, you can get access to BTC.
However, we know that PayPal as usually charged higher prices for their services. This is why you should understand which are the fees they charge for the transfers.
Revolut and Robinhood work in different ways. These platforms can be the best ones if you want to buy a small number of cryptocurrencies. Some of their transfers do not have fees. Revolut charges some fees when the user process more than 3 purchases per month in the free account.
Things are different with the premium accounts. There you pay a monthly fee but you have fewer limits to trade Bitcoin and other cryptocurrencies. In this case, you should understand whether the price of BTC in this platform is offering is cheaper than traditional exchanges.
Robinhood, instead, offers free trading to users. Yes, you don’t have to pay a commission every single time you execute a trade. Nevertheless, this platform has been considered to use a business model that could not offer users the best Bitcoin price.
You should check whether the price of bitcoin in this platform is cheaper than in other competitors. This is the first thing you should do if you want to find the cheapest way to buy Bitcoin in the market.
What is Arbitrage Trading?
As you now know what to look for to find the cheapest way to buy Bitcoin, we can move to Arbitrage trading. Arbitrage trading is a trading strategy that allows you to make profits with Bitcoin price differences.
If you find that Bitcoin is cheaper in one platform you could buy BTC and sell it in a platform where the price is higher. You would be able to make profits with the difference in the price of Bitcoin.
Let’s get a clear example. In platform A Bitcoin is being traded at $10,000. However, in platform B, you realize BTC has a price of $10,500. These are $500 of difference per BTC. You could simply purchase BTC in platform A and sell them in platform B for $500 more. This is something that has some risks, but many users are doing this.
You do not only need to pay attention to BTC but also to other cryptocurrencies that could be faster to transfer between platforms.
Profiting After Finding the Cheapest Way to Buy Bitcoin
As you now know which is the cheapest way to buy Bitcoin and what arbitrage trading is, we can start profiting with it. However, you should take into consideration that there are some risks involved.
If you are doing arbitrage trading, you will basically be buying cheap BTC (or any other crypto) and selling it at a higher price in another platform. This can take a few hours to be processed. Moreover, you need to take many things into consideration.
The first thing you need to do is to check the price in both of the sites. In this way, you will understand if there is an arbitrage opportunity. Moreover, you need to understand if the difference in the price of both sites is worth the risk.
Thirdly, you will have to understand whether the costs involved will be less than the price difference between the sites. Remember that exchanges have trading fees between 0.1% and 1% per trade. Some other platforms will also have fees to withdraw your funds. To this, you will also have to add BTC or cryptocurrency fees to transfer the funds.
Finally, you will have to move the funds from the second platform to your account once again. The whole process might be somehow tedious, but in some cases, it is worth the money. It is also worth pointing out that price volatility could affect the price of the asset you are arbitraging.
If during the transfer between platform A and platform B, Bitcoin fell to $9,500 in both platforms. Then, the arbitrage trade would be already below your target. In addition to it, you will also have to pay for transfer fees and additional costs. This is the main risk you are facing when doing arbitrage trading.
Final Words on the Cheapest Way to Buy Bitcoin
There are different ways to buy Bitcoin. We have gone through most of them. There is no clear answer on which is the cheapest way to buy Bitcoin with credit card (or without). This is something that you will have to investigate according to the market conditions.
There are, however, platforms where the price of Bitcoin is cheaper. You should add to this that there is a possibility to find a platform with lower commissions for processing a transfer. If that’s the case, you will be able to get access to the cheapest Bitcoin in the market, or at least in your region.
We have also seen how some countries have a higher Bitcoin or cryptocurrency price. This is related to economic conditions from each of the countries. Furthermore, supply and demand in some regions are unbalanced, and this provides a great opportunity to do arbitrage trading.