Ben Todd | Jun 2, 2017 | 1
How to Buy Bitcoin: The Ultimate Beginner’s Guide to Buying Bitcoin & Altcoins
Like a lot of people you have probably heard; and read, a great deal about bitcoin and cryptocurrencies but still do not know what they are. Worse you might have a vague notion of how these new financial technologies work.
Everybody needs to know what altcoins are; because they have the potential to upend the entire financial system and change our lives. If they are successful cryptocurrencies might change how you do business, get paid, pay taxes, buy and sell goods online and in store, invest and bank.
If they are successful cryptocurrencies might change how you do business, get paid, pay taxes, buy and sell goods online and in store, invest and bank.
Not surprisingly the potential of these technologies have attracted the attention of a lot of investors. Individuals ranging from Chinese grandfathers to Wall Street hedge fund operators are buying up large amounts of cryptocurrency in anticipation of cashing in on the disruption it might cause.
We’ve created this guide to explain the basics of altcoins in general and bitcoin in particular to ordinary people.
I want to state personally that I’m a firm believer in cryptocurrency and I see the technology (represented by bitcoins and alt coins) as disruptive technology, much like the internet was in the 90’s, mp3’s were to the music industry, and streaming was to the video industry.
Over the next few years, we will start to see crypto currency bleed into the real world and provide better solutions than currency exist, especially in the financial sector (money transfers, payment processing, identity storage, etc).
Hopefully, this will be the beginning of your journey in which you learn all the opportunities and potential pitfalls associated with cryptocurrencies.
What the Heck are Cryptocurrencies and How Do They Work?
A cryptocurrency; or altcoin, is a purely digital medium of exchange that is supposed to function as money. That is you can buy and sell with it and convert units to government or fiat currencies.
Unlike fiat currencies altcoins are issued and maintained by networks of users. These networks include bankers, programmers, businesspeople, investors, entrepreneurs and many ordinary people who are trying to create an alternative to government currencies. The ultimate hope is to create a currency anybody can use anywhere in the world.
Many of the altcoin creators believe they can one day produce currencies that will not be subject to inflation and devaluation; and immune to government tampering, such as currency controls. This makes cryptocurrencies very popular in countries like China and Venezuela, where most citizens distrust the government.
Cryptocurrencies employ two technologies that are supposed to make them tamper resistant. Encryption is a kind of code like that used by spy agencies which is very hard to break. A major goal of cryptocurrency geeks is to create an altcoin that is totally anonymous so that tax collectors and fraudsters will not be able to track down users.
Blockchain is an operating system that is designed to create a permanent record which cannot be altered or erased. The hope is that a user will be able to trace the blockchain back to its creator and authenticate it no matter how many times the altcoin is bought and sold.
There are now many different cryptocurrencies out there but the three most popular are Bitcoin, Ethereum and Litecoin.
These currencies are widely traded on exchanges and used by people all over the world. In recent years there have been also many attempts to create new cryptocurrencies including some for specialized purposes like UnicrnGold which is designed for sports wagering.
There are over a thousand different crypto currencies (check out coinmarketcap.com) and the number is growing.
Bitcoin is the first cryptocurrency. Many other crypto currencies (called altcoins) seek to solve a specific market problem and offer a unique solution, solutions that Bitcoin does not address.
Here’s a breakdown of some of the main (top 5) cryptocurrencies on the market:
Bitcoin: a store of value, considered a version of digital gold (that you can spend). Due to the high volatility and slower transaction speeds, it’s not ideally suited as a daily currency.
Litecoin: often called ‘the silver’ to the Bitcoin gold. Offers advantages of must faster transaction times, reduce transaction fees and less volatility.
Ethererum: a platform crypto currency that allows other tokens (or crypto currencies) to be built on the ethererum platform. Ethererum is not so much an alternative to money as it is a platform that enables the creation of other crypto currencies. The key defining feature of ethereum is that it offers smart contracts on the network (conditional execution of contracts made on the system).
Ripple: a crypto currency that seeks to enable faster, decentralized money transfers between banks. Ripple (the crypto currency itself is called XRP) seeks to become a decentralized version of the SWIFT system and envisions the world where you can basically send money across borders between accounts with the click of a button without huge fees, waits, or other bureaucratic weigh down that are involved with sending money.
There are many, many other crypto currencies such as privacy coins (Monero) that allow anonymous payments, sports betting currencies (Wagerr), gaming currencies (Digibyte), identify verification (Civic), payment processing (Omnisigo), and many more.
What is Bitcoin?
But let’s go back to Bitcoin, the first ever cryptocurrency and the technology that inspired (and in many cases spawned direct copies) all the other cryptocurrencies in existence.
Bitcoin is the oldest cryptocurrency created in 2009 by a shadowy figure called Satoshi Nakamoto. In 2015, Wired magazine reported that an Australian named Craig Wright claimed to be Nakamoto, and some bitcoin insiders confirmed the report.
Bitcoin was a revolutionary piece of technology, because it was the first widely available digital currency anybody could buy. More importantly it was the first altcoin to use blockchain to guarantee security and authenticity.
Bitcoins have become very valuable because they can be used as an investment, a currency; or a hedge against inflation. Many people buy or mine bitcoins the way others invest in stocks. Most consumers use them as a digital currency to buy everything from gift cards to merchandise.
Large numbers of people; particularly in China, use bitcoin as a hedge against inflation. That is they buy bitcoin because they think it is less likely to lose value to inflation than their nation’s currency the Yuan. That way they preserve the buying power of their money, even if their currency loses all its value.
Today bitcoin is the most popular and widely used cryptocurrency. It is traded on exchanges, accepted by Swiss banks and major online retailers, and widely covered in the media.
Around 16.49 million bitcoins worth around $47.7 billion were believed in circulations on 19 July 2017. The value of a bitcoin on 21 July 2017 was $2,674.18 as recently as January one traded for around $13. It is that almost astronomical increase in value that is attracting vast numbers of investors, speculators and traders to bitcoin.
Why Buy Bitcoin
There’s a lot of reasons. Here are some main ones.
- A store of value: Bitcoin is deflationary. There’s a limited amount of bitcoin with only 21 million coins that will ever be in existence (16,000 million currently in supply). Currencies are inflationary with governments printing money on demand. This causes your money value to depreciate over time. That’s why $100, just five years ago would buy MORE than it would now. Storing your money in Bitcoin is a method of preserving your value and protecting it from inflation.
- Decentralized: there is no government who can seize your Bitcoin. It’s not controlled or regulated by anyone and supersedes governments and countries, and political ambitions.
- Fast Transfers of Money Across Borders: you can use bitcoin to send money anywhere in the world — fast and cheap. In many cases, it’s superior to using wire transfers.
- Investment: Buying bitcoin is an investment as the value can increase. For example, as of time or writing, Bitcoin value increased from $1000 to $4000 USD in a single year. That’s up 400%! This means if you bought one bitcoin for $1000 the past year, you could cash it out for $4000 USD now.
- Make Money through trading: you can make money with Bitcoin by trading it back and forth with USD or using it to buy altcoins which may increase in value. Many people have made and are making incredible amounts of money through cryptocurrency trading.
How Bitcoin Works
The best way to think of bitcoin; and other altcoins, is as a more advanced form of a digital wallet such as PayPal, Apple Pay or Android Pay.
A traditional digital wallet lets users store currency, make purchases, receive payments and transfer money like a bank account. The difference is that with an altcoin the electronic payment medium itself to make the payment and store value.
Regular digital wallets are a storage mechanism for currency. A cryptocurrency is both a storage mechanism for value and a payment method. You can use it as an investment or as a means of payment.
In bitcoin the value is stored in the blockchain which functions as the currency’s operating system. All other altcoins work in the same way. When a person buys them he or she is storing value in the blockchain. The value can be accumulated; as in a savings account, traded like stocks, or used to make purchases like money.
Bitcoin has become a popular means of payment because it can be sent electronically anywhere in the world there is an internet connection much like a wire transfer. The difference is that the bitcoin does need to be converted into other currencies like Australian dollars would. That means you can preserve value when making international transactions.
Instead the person you send the money decides whether to convert the bitcoin into fiat currency or leave it as cryptocurrency. This makes life a lot easier for people in China; where the currency is not supposed to trade on international markets, and those in countries like Zimbabwe where the national money is worthless.
Why you should buy Bitcoin and Other Cryptocurrencies
There are several very good reasons why almost everybody should consider investing in bitcoin and other cryptocurrencies. Excellent reasons for investing in altcoins include:
- They provide a hedge or protection against inflation. If you’re an adult you know that money is not worth as much as when you were a kid. That’s the result of inflation and it’s likely to continue, any cash you keeping in your savings or chequing accounts will lose value to inflation.
- Unlike stocks or bonds, bitcoin can be used to make a wide variety of transactions right now. For example there are many websites where you can use bitcoin to purchase gift cards that can be used at retailers. Many of these sites sell digital gift cards for bitcoin that can be used on Amazon. Amazon will not accept bitcoin but many other large retailers including Dell do.
- You can convert your bitcoin investment into cash almost instantly. That means you will not have to incur the transaction costs of selling stocks or bonds to access to funds. You can either use your bitcoins to make purchases or sell it to get cash quickly.
- Unlike precious metals bitcoin can be sold almost instantly. If you own gold or silver you will have to find a shop that buys it probably a pawnbroker. Then you will probably receive half or one third the actual value in payment. You cannot take gold to the supermarket and buy food. Most supermarkets will not take bitcoin, but you can convert into something they will take; dollars, with the press of a button.
- There are bitcoin debit cards such as the Visa from Bitpay that can be used at any retail store that takes credit cards. This means that unlike gold you can use bitcoin to make direct retail purchases such as petrol or food. Shop carefully for because not all of these cards are available in Australia. Some bitcoin MasterCard gift and credit cards are also available.
- Bitcoin is an easy way for average people to diversify their investments. Most investment experts recommend that you put your money in a number of different vehicles such as stocks, bank accounts and bonds to protect it from losses. Bitcoin is a cheap and easy way to diversify without spending a lot of time and money on brokers or investment research.
- Bitcoin is a great way to protect your funds from a downturn in the Australian economy because it trades worldwide. Cryptocurrencies like bitcoin might keep their value while currencies like the dollar lose theirs. That means you might have more purchasing power with altcoins.
- Bitcoin is capable of gaining a lot of value real fast. The value of a bitcoin increased by 317.72% or $2,100.50 in the year between 22 July, 2016, and 22 July 2017. This means owners more than tripled their money in less than a year.
- Bitcoin is recognized as money in Australia; so it is exempt from double taxation through the General Sales Tax. For more details see this Cointelegraph article.
Can you Make Money Buying & Trading Bitcoin
Yes you can make money buying and selling bitcoin. Market data provided by Coinbase clearly shows that some people have made a lot of money out of bitcoin and other altcoins.
A person that bought one bitcoin worth $568 on 22 July 2016 would have seen her investment more than triple in value to $2,761.23 over the next year. She would have taken home a profit of $2,100.50 or 317.91%. An individual that purchased 10 bitcoins for $5,680 on 22 July 2016, would have seen them increase in value to $27,610, over the course of the upcoming year.
So it is possible to make a lot of money buying, selling and trading bitcoin but you can also lose a lot of money. Between 8 July and 16 July 2017 bitcoin lost $542.97 in value in an eight day period. A bitcoin was worth $2,535.29 on 8 July and $1,992.32 on 16 July.
Therefore you can make money with bitcoin but you can also lose money through it. A good strategy for preserving your investment would be to reinvestment your bitcoin earnings in something more stable like stocks or real estate.
Where to Go to Buy Bitcoin and Where to Start Using Bitcoin
The best way to become familiar with cryptocurrencies is to get yourself a digital wallet and start making small trades with it. Some really good digital wallets include:
- coinbase.com – This American-based service provides wallets that let you buy and sell bitcoin, ethereum and other popular altcoin called Litecoin. It also offers an excellent set of easy to read charts that track cryptocurrency prices. Note coinbase has a reputation for having very slow wire transfers, so don’t use them if you need to get cash into the exchange to buy bitcoin fast.
- bitstamp.com – one of the older and more trusted exchanges based in London. They serve global clients and they allow huge wire transfers (one of the best exchanges to send large deposits of cash to, if you want to buy bitcoin)
- Gdax.com – Coinbases.com’s crypto exchange site. One of the largest in the world and one of the most trusted.
- bitcoin.com.au – This popular bitcoin specialist is based in Richmond, Victoria. It offers wallets and buys and sells bitcoins. The site blog is a good way to keep up with cryptocurrency developments in Australia.
- bitpay.com – This popular American digital wallet also offers a Visa card that enables users to make retail transactions and get cash from ATMs or stores. Bitpay also offers some services for American merchants.
- CEX:IO – This popular bitcoin exchange based in the UK offers market data, margin trading and digital wallets that can be used all over the world. It is one of the best places to go if you are interested in bitcoin currency trading.
- Cointelegraph – A good all-around news source for all things cryptocurrency it will keep you up on the latest developments.
- Cryptocoins News – Another good source of news and information about cryptocurrency.
- Gyft – One of several websites that let you buy gift cards with bitcoin. It offers an app you can download to Android or Apple phones. Amazon and eBay cards are available here.
- Genesis Mining – If you are interested in bitcoin; or ethereum, mining this is a good place to start. Genesis is one of the largest and most reputable miners. Its’ blog is a good source of information.
Bitcoin Exchanges: A Breakdown
A bitcoin exchange is actually a company that specializes in trading or buying and selling of cryptocurrencies.
Most exchanges; and traders, try to make money by speculating or betting on the differences between currency prices. If bitcoin is expensive and U.S. dollars are cheap they sell bitcoin and buy US dollars for example.
A reputable exchange will be based in a country like Australia or the UK and regulated by that nation’s government. It will offer a digital wallet that lets you buy and sell bitcoins and take credit card, bank transfer and wire-transfer payments.
A good exchange will disclose all fees, limitations and restrictions up front. It should also have 99.999% service availability; that means its website will work when you need to access your money, and proven financial stability. Reputable exchanges will also disclose all problems such as technical difficulties and security breaches right way.
The best way to tell if an exchange is reputable is check and see how many active traders it has and if it has a high-volume of trading. Having a high volume of trading indicates that has an exchange has many satisfied customers.
Be prepared to shop around and check out a number of exchanges because the market is growing. That means there are some very new ventures that might not be financially stable out there.
Etherereum & other Altcoins
Nobody knows how many cryptocurrencies there are but experts estimate that are around 700 altcoins in existence. Most of those cryptocurrencies are worthless because nobody accepts them but there are several widely used altcoins.
The other big altcoins out there include:
- Ethereum (which is also known as Ether or ETH) – Ethereum is the only cryptocurrency that is even close to rivaling bitcoin in popularity. Ethereum is actually a platform that allows users to create smart contracts, and other documents that can be bundled with the ether. Ethereum’s greater versatility has attracted the attention of giant banks such America’s JPMorgan Chase and leading tech companies such as China’s Tencent Holdings. One potential use for ethereum will be to create cryptocurrency markets for stocks and commodities. Ether can now be bought, sold and traded on most of the exchanges that accept bitcoin.
- Litecoin (LTC) – A faster more refined version of bitcoin created by former Google engineer Charlie Lee in 2011. Some people prefer Litecoin because it is faster than bitcoin. Litecoin is also tracked and traded by some major digital wallets including Coinbase.
- Zcash (ZEC) – A very new and slightly-more advanced altcoin. Zcash’s developers claim their cryptocurrency offers more privacy and security. Zcash is not widely accepted because it was just launched in late 2016.
- Ripple (XRP) – A more advanced cryptocurrency that is supposed to work without mining. Ripple was created to help banks settle cross border payments in real time. Ripple was designed for institutional buyers and it is accepted by many merchants or exchanges.
- Dash or Darkcoin – This altcoin has a real sleazy reputation because it was designed to be used on the darkweb which criminals use to hide cash. Exchanges will not accept Dash because of its criminal connections. Average people should stay away from Dash, unless they want to find police or intelligence agencies tracking them.
- Monero (XMR) – Another cryptocurrency that is supposed to be untraceable, donation-based and community-driven. Monero is not widely used or accepted by any major exchanges.
The only cryptocurrencies average people should consider investing in; are bitcoin, ethereum and litecoin. The rest of the altcoins are mostly for hobbyists and geeks and any money sunk into them is likely to be lost.
Bitcoin is the best altcoin for average people because it can be widely used for a wide variety of transactions and easily converted into dollars. Although ethereum is becoming widely accepted and might soon break into the mainstream like bitcoin has.
How to buy Bitcoin with a Credit Card
Buying bitcoin and other altcoins with a credit is real easy all you have to do is sign up with almost any digital wallet.
Most of the major digital wallets such as Coinbase, Bitcoin.com.au, CEX.IO and Bitpay accept both Visa and MasterCard. Any digital wallet that accepts Visa and MasterCard should accept payment through both credit cards and digital cards.
Best Way to Buy Large Amounts of Bitcoin on a Credit Card
If you want to buy large amounts with a credit card, look at CEX.IO as one of the best. You can, if you verify your account, buy up to $3000 USD on your credit card. If you sign up for an institutional account (i.e. you have a company), you can charge up to $10,000 USD on your credit card per day to buy bitcoin with on CEX.IO.
Once you sign up for the digital wallet, all you have to do is enter your credit or debit card information. Then buy amounts of cryptocurrency just like you would a video from Netflix or a book from Amazon.
Some of these solutions also offer mobile wallet which you can use to buy bitcoin with a credit card balance. A few of the digital wallets like Coinbase and CEX.IO will also let you buy other altcoins like ethereum and Litecoin with a credit card.
Most of the large bitcoin mining services such as Genesis also take credit card payments. That can allow you to purchase new bitcoins just as they are created. Genesis also offers ethereum and Litecoin mining.
How to buy Bitcoin with PayPal
This is one of the worst ways to buy bitcoin. It’s super expensive and a big hassel. But here’s how.There are two ways that you use your PayPal account to buy
There are two ways that you use your PayPal account to buy bitcoin and other cryptocurrencies. Your options are:
- Sign up with one of the bitcoin wallets that accept PayPal payments. There are a number of these out there including Paxful and Buy Bitcoin with PayPal. The problem with these solutions is that they can be more expensive. Buy Bitcoin with PayPal will let you buy $10 worth of bitcoin for $15 USD which is a pretty bad deal for example.
- Simply sign up for one of the PayPal accounts that offer a MasterCard like the merchant account. Once you get your MasterCard enter the card number into your digital wallet and use it to buy bitcoin just like a credit card.
How (and where) to buy Bitcoin with an ACH Payment (free)
An ACH; or Automated Clearing House, payment is an electronic funds transfer that comes right off your bank account balance. You send an ACH every time you use online bill pay and authorize one whenever you write a cheque.
The great thing about an ACH is that it is free and instant. Another advantage is that you pay with the money you have in the account and don’t accrue any interest.
Buying cryptocurrencies with an ACH is real easy. All you have to do is follow these three simple steps:
- Sign up for a cryptocurrency exchange that supports ACH. ACH support is limited to only a handful of exchanges. As of mid 2017, CEX.IO offers $10,000 ACH transfers from your bank to the exchange; Gemini.com also offers ACH transfers.
- Connect your bank account by entering your account and Bank State Branch (BSB) number. These are the two numbers found your cheques. Once the digital wallet has them it will be able to send and receive funds from your account.
- Follow the wallet’s instructions to buy the amount of bitcoin you want and pay for it with funds from the account.
How to buy Bitcoin with a Wire Transfer
Buying bitcoins with a wire transfer is a little trickier because most exchanges have account minimums and limits for wire transfers. Some of the larger services refuse to accept such payments such as Coincafe.
However, if you want to buy larger amounts of bitcoin, wire transfers are the best (and cheapest way to go). They also take about 2 to 5 business days. So if you need to buy bitcoin ASAP, wire transfer is not the way to go. Give yourself a solid 5 days in advance. Also note that your bank will charge you a wire transfer FEE (usually between $20 to $45 USD).
Here is the standard process for making wire transfer purchase:
- You will have to create a transfer order. Make sure you meet all minimums and limits.
- Follow the instructions.
- Send the wire.
- Make sure that you accept the wire receipt.
- Wait for the bitcoin seller to verify your payment.
- Receive the bitcoin, make sure you receive.
Buying bitcoin via wire transfer makes no sense for most purchasers because of the extra cost, limits and hassle involved. Most people will save money and time with an ACH or a credit card purchase.
I’ve personally used Bitstamp.com to send wire large transfers to from the USA. But CEX.IO and Gemini.com are two other trusted exchanges that will accept wire transfers. Kraken.com is another.
How to buy Bitcoin with Cash
Purchasing bitcoin; and other cryptocurrencies, with cash and can be a frustrating and confusing experience, especially if you do not wish to convert cash into electronic currency. There are a few ways to purchase cryptocurrencies with cash but they will be more expensive and time-consuming.
Some means of buying bitcoin with cash include:
- Gift cards and reloadable debit cards. Follow this procedure:
- Purchase a Visa or MasterCard gift card or reloadable debit card from a store.
- Load the amount of cash you want into the card.
- Simply enter the number from the card into your wallet and purchase the amount of altcoin you want.
- Find a bitcoin ATM. Nobody knows how many bitcoin automatic teller machines (ATMs) there are but several thousand have been installed around the world. They are located in most big cities and there are around a dozen in Australia. The ATM map at CoinATMradar can help you find you one.
If you can find a Bitcoin ATM most of them will take cash in the same way that bank ATMs accept cash deposits. Once the deposit has been accepted you will have a set number of bitcoins. Be careful because some of them will charge very high fees. Unfortunately most of the ATMs will not sell ethereum or Litecoin; but you can easily convert the bitcoin you purchase into other cryptocurrencies online if you wish.
- www.localbitcoins.com – this is a site that facilitates bitcoin trades in your area. Probably the best way to buy bitcoin with cash (or trade bitcoin for cash) without having to go through the banking system. It’s more expensive though, as you pay an extra percentage to the person for this.
- Bitcoin meetups. These are groups of cryptocurrency geeks that meet in various locations such as pubs and coffeehouses. At these you can give cash to somebody who will convert it into altcoins. The problem with that is you will be giving cash to a stranger, so there’s no guarantee he will not spend it on beer instead of bitcoin.
- Friends or family. Simply ask a friend or family member you trust to deposit the cash in his or her bank and send it to your PayPal account. You can then use PayPal to buy the bitcoin.
- Open a bank account. This is undoubtedly the best method, because bank accounts are regulated and insured. Once the account is up and running you can simply use free ACH to buy your altcoin, with few risks. Best of all you will be able to buy your coins safely at home without the hassle of finding and traveling to a meetup or ATM.
How to Convert Your Bitcoin to Cash
The biggest hassle with altcoins; like other electronic payment methods, is converting them to cash. Unfortunately most of us still need cash occasionally; for street vendors, small purchases and car boot sales. If you are traveling in countries like the United States, you will also need cash for tips.
Fortunately there are some simple methods of converting cryptocurrency into paper money. The best include:
- Sell the bitcoin and transmit proceeds to a bank account via ACH. This is definitely the best method because it is free and secure. Once in the bank you can withdraw cash from a teller or an ATM or a retail store with a debit card. Many large retailers in countries like the United States allow free cash withdrawals with purchases.
- Wire transfer. Sell the altcoin and have money wired to you via Western Union or MoneyGram then pick the cash up at one of their offices. You can also have money wired to you at most banks.
- Bitcoin ATMs. You can sell bitcoin and withdraw the proceeds in cash at most bitcoin ATMs but they will charge a fee.
- Transfer the proceeds of an altcoin sale to your PayPal account then withdraw funds via your bitcoin debit card and an ATM.
- Bitcoin debit and credit cards. There are a number of these available including the one from Bitpay. The ones with the Visa and MasterCard brand names can be used to withdraw cash at most ATMs and many stores. They can also be used to make purchases at almost any brick and mortar store.
- Friends and family. You can always send a payment to somebody you trust and have that person withdraw cash for you.
Try to keep cash withdrawals small because they are expensive and involve a lot of time and hassle. For most uses a bitcoin credit or debit card will be cheaper and easier.
The Best Bitcoin Exchanges
Finding a good bitcoin exchange is tough because there are hundreds of cryptocurrency exchanges out there. Choosing the right one is almost impossible for a newbie and difficult even for hardened altcoin geeks.
Here is a breakdown of popular exchanges to let you choose which one is best for your needs:
Finding an exchange with low fees is vital because fees can quickly eat up all of your altcoin profits. The exchanges with the lowest fees include:
- IO – no maker fee (charge for bitcoin generation), .1% to .2% taker fee (trading charge), 3.5% + 25¢ credit card deposit fee, $3.80 Visa withdrawal fee, 1.2%+ $3.80 MasterCard Withdrawal Fee, no bank deposit fee and $50 bank withdrawal fee.
- Coinbase – 1.49% trade fee, 3.99% credit card deposit fee, 1.49% bank deposit fee, $10 wire transfer, 1.49% ACH bank withdrawal fee, 17¢ SEPA bank withdrawal fee. May charge a fee for credit card withdrawal.
- GDAX – no maker fee, .1% to .25% taker fee, 3.99% credit card deposit fee, $25 bank withdrawal fee.
- Kraken – .10% to .26% taker fee depending on volume, .00% to taker fee depending on volume, may charge for credit card transactions, .0%-.19% or fixed commission wire transfer and bank deposit fee depending on country and currency.
Lowest Wire Fee
- Kraken – .0%-.19% or fixed commission depending on country.
- For average people; Coinbase, instant verification of trades is available through the digital wallet.
- For traders; CEX.I0, fast verification is available on the trading platform.
The Final Word
Cryptocurrencies present a wonderful opportunity for trading, hedging, investing and reducing costs on money transfers but they are not for the faint of heart. Risk-averse people should probably avoid the sector for now.
Those who can live with some risk should seriously consider investing in altcoins. This technology might be the future of finance and investment, those who become familiar with it will have an edge over late adopters.