In 2017 it is now possible to purchase bitcoin directly. From credit cards to bank transfers, from cash to PayPal – there is no shortage of payment methods for buying. Each method will have its associated inconveniences and strengths.
Speed to deposit, commissions, ease-of-use, degree of anonymity, fungibility, proximity, and security – are all important factors when choosing a deposit method.
PayPal vs Credit Card
What makes people want to transfer PayPal to bitcoin and vice versa? The simple fact that PayPal is instant, ubiquitous, and quiteconvenient (Many people use it as their favorite payment processor). Using PayPal is great for small amounts, but it’s far cheaper to use other payment methods (credit card, bank transfer) for larger transactions. Credit card purchases are the simplest way. Fees are high, but generally not as high as when buying with PayPal. Be aware that not many PayPal to bitcoin exchanges exist and therefore some places may take advantage of this.
Use the following diagram to compare PayPal vs Credit Card for buying BTC:
Cash (in-person) vs Buying Bitcoin Online
There are two accepted ways to buy bitcoin with cash:
- Using a Bitcoin ATM – you put cash in, it sends bitcoins to your specified address
- Meeting a person and swapping your cash for their bitcoins
Generally speaking, buying bitcoins with cash will guarantee the highest levels of anonymity. Fees are higher than buying by bank transfer, but at least you will keep your ID secret and no one has to know who you are. Some people choose cash because they want to buy bitcoin with no ID, but for large transactions this become quite inconvenient, risky, and even physically dangerous. Another downside is that you usually have to go to physical location to meet someone, rather than just being able to do it all online. Please note that not all bitcoin ATMs are anonymous. Some do require ID submission.