How to Buy Bitcoin with Prepaid Cards

Prepaid cards, also known as pay-as-you-go or everyday cards, are used to buy goods and services, similar to debit and credit cards. Still, there are key differences between prepaid cards and credit/debit cards that make the former more convenient for daily purposes.

Recently prepaid cards have become a popular method of buying Bitcoin. Cryptocurrency exchanges usually charge higher fees when using prepaid cards, but these cards have some critical advantages over other payment methods.

How to Buy Bitcoin with Prepaid Card

Choose a Bitcoin exchange – we recommend Coinbase for prepaid cards
Create an account
Deposit funds into your account, entering your prepaid card details
Search ‘Bitcoin’ in the drop-down menu
Click ‘Open Trade’ and select an amount of Bitcoin to buy

Best Places to Buy Bitcoin in December 2023

While eToro and Binance don’t yet accept prepaid cards, they do accept debit and credit cards, bank transfer, Paypal and more deposit options. We can expect them to support prepaid cards in the near future.

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ASIC, CySEC, FCA

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$50

100 EUR

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$10

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1 - 10x

1 - 100x

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While making our list of recommended exchanges to buy cryptocurrency and Bitcoin with a prepaid card, we took some features into account. Safety and regulation are in the first place for us. Coinbase and Coinmama are fully licensed and regulated brokerage platforms. While CEX is still unregulated, it has robust safety features and is registered with FinCEN.

The second important factor is their pricing system. The above-mentioned platforms offer fee systems that are pretty competitive compared to other exchanges that allow you to buy bitcoin with prepaid cards. And finally, their user interface is also an essential factor to consider. Most of the platforms have easy and user-friendly trading platforms, while some of them also give access to more advanced platforms such as MetaTrader 4.

Buying Bitcoins instantly with Prepaid Cards without Verification

Some cryptocurrency exchanges allow you to buy Bitcoin with a prepaid card instantly and without verification. Still, the number of such exchanges is not high and some of them have limitations for the amount of Bitcoin you can buy without verification.

You can also use P2P marketplaces like Binance to buy Bitcoin without verification, but they are not as safe as regulated brokers, so there is a high risk of losing your money.

It’s also worth noting that though top brokers require you to verify your ID, they don’t share your details with any third party. It’s a part of their policy and is required by law to protect user’s privacy and boost safe trading.

Pros & Cons of Using a Prepaid Card for Buying Bitcoin

Using your prepaid card to buy bitcoin is not the cheapest way, but it enables you to make transactions more quickly and effectively. With that in mind, let’s review the advantages and disadvantages of using this method.

Pros

You can buy bitcoin with a prepaid card instantly, unlike wire transfer method.
It’s a more convenient and accessible method for buying cryptos.
You can use only the funds you have on your card, which lowers the risk of debts.
You provide less information about you; hence it’s a more secure way of buying BTC.
Even if your prepaid card is hacked, they can only use the funds on it but not your checking accounts.

Cons

Fees are relatively higher.
There are not too many good crypto exchanges that accept prepaid cards.
Some limitations can be related to how much Bitcoin you can buy with a prepaid card.

Withdrawing Bitcoin from a Brokerage Account

Whether you want to keep your bitcoin for a long time or sell it after a while, it’s not a good choice to leave your coins on your brokerage account. As the exchange platforms are centralized, they are more vulnerable to being hacked, so you can lose your coins if this happens.

To avoid this, you can withdraw your bitcoin to a cryptocurrency wallet; from there, you can sell it, transfer to another crypto exchange account or hold it as a long-term investment. Crypto wallets help you to store your cryptocurrencies more safely and away from the threat of third party.

However, if you have traded bitcoin, made profits, and want to withdraw cash from your brokerage account, you need to sell your bitcoins and withdraw money. The process of selling your bitcoin may seem a bit complicated, but it’s an easy one. For more information, you can visit our guide to learn how to sell your bitcoins and withdraw your cash.

Where to Buy Bitcoin with Debit Card

To buy bitcoin with a debit card, you need to find a reliable cryptocurrency exchange that will be convenient in terms of fees and user interface. In our list, we have included the best exchanges that accept credit cards and debit cards as payment methods.

OKX – Best Crypto Exchange for Buying Bitcoin with a Debit or Credit Card

OKX is a reputable cryptocurrency exchange that has gained prominence as a reliable platform for users to buy, sell, and trade digital assets in more than 100 countries, serving a broad base of over 20 million users globally. Since its establishment in 2017, OKX has remained headquartered in Malta, with strategic offices situated in Hong Kong, Singapore, and South Korea. Its intuitive interface and diverse trading features, such as margin and futures trading, have endeared it to users.

One of the easiest and most efficient methods of purchasing Bitcoin on OKX is through debit or credit cards. This payment option enables users to purchase Bitcoin without delay, avoiding the hassles of transferring funds from a bank account. To acquire Bitcoin via a debit card on OKX, users only need to sign up for an account, verify their identity, and add their debit or credit card details. Once this is done, users can select the desired Bitcoin amount and complete the transaction with ease. So, for anyone seeking a reliable exchange to buy BTC, OKX is an excellent option to consider.

Visit OKX

Bybit – Tier One Exchange for Buying Bitcoin Using a Debit or Credit Card

Founded in 2018 and headquartered in Singapore, Bybit is a cryptocurrency derivatives exchange that has garnered significant popularity among cryptocurrency enthusiasts globally due to its diverse range of trading products and services, including perpetual contracts, futures contracts, and options contracts, all of which can be traded with high leverage.

As a tier-one exchange, Bybit places user security as its top priority and has implemented robust security measures such as cold wallet storage, two-factor authentication, and multi-signature authorization for transactions, providing a secure trading experience for its users.

New users are attracted to Bybit due to its highly appealing sign-up bonus of 5030 USDT. Moreover, the exchange accepts various payment methods, including debit or credit cards, making it a highly accessible and convenient platform for buying and trading popular cryptocurrencies such as Bitcoin.

Visit Bybit

Coinbase – Buy Bitcoin with a Debit card Quickly and Easily

Founded in 2012, Coinbase is one of the most popular cryptocurrency exchanges in the market, with more than 50 million users from several countries of the world. One reason for this is that Coinbase has a very easy-to-use interface which helps investors to easily and quickly buy bitcoin.

Coinbase has a bit of a complicated fee system. It does not charge buy-and-sell spreads but charges a commission fee, which is 1.49% of your trade. Apart from this, it also sets deposit and withdrawal fees which vary depending on the payment method. Coinbase has also launched its more simplified account – Coinbase Pro, which offers lower prices but has limited options compared to Coinbase.

Visit Coinbase

Coinmama – Buy Bitcoin with a Debit card in Three Clicks

Coinmama is a cryptocurrency exchange platform that was launched in Israel in 2013, and nowadays, it operates in 200 countries of the world and most of the states of the US. The exchange supports ten cryptocurrencies, and when you purchase them, they are sent directly to your personal wallet. The broker accepts various payment methods, including credit and debit cards, however, in order to buy Bitcoin, you need to go through the verification process.

As for pricing, Coinmama charges 5.9% percent for each transaction you make, which is included in the cryptocurrency price. Plus, a 5 percent fee is charged when you buy with your credit or debit card. Regarding your privacy, it would be fair to consider Coinmama a self platform, as it is regulated by FinCEN. Additionally, it does not hold your cryptos on centralized storage.

Visit Coinmama

CEX.IO – Buy Bitcoin with a Convenient Mobile App

CEX.io is another well-established crypto exchange platform that started in 2013 as an only-bitcoin exchange. At that time, it held more than 40% of the total Bitcoin mining power. In 2015, it began to accept Ethereum and concentrated on other cryptos in addition to Bitcoin.

CEX charges trading fees that differ depending on how you trade. The highest trading fee is required for instant trading, which makes 7%. But the trading fees are very low when you choose a more advanced method of trading. CEX also has a well-designed mobile app that is very convenient for mobile trading.

The exchange also offers withdrawal and deposit fees which again differ depending on the payment method you choose. When it comes to safety, CEX has gained a good reputation. The platform is licensed and registered with FinCEN. Plus, it provides several safety features to obtain privacy for its users.

Visit CEX.io

FXCM – Buy Bitcoin via an Advanced Trading Platforms

FXCM is one of the oldest forex brokers that started in 1999. The platform offers a limited selection of cryptocurrencies, including, obviously, Bitcoin. One of the main attractions of FXCM is that it offers advanced trading platforms to its users, including MT4 and Trade Station.

FXCM does not have requirements for a minimum deposit, but the amount you deposited affects your trading fees and spreads. So, the higher your minimum deposit is, the lower your trading fees will be. But overall, FXCM is certainly one of the best choices to buy Bitcoin with debit cards.

FXCM offers two payment methods – wire transfer or credit/debit card linking. The wire transfer method is not that much recommended as long as there is a mandatory fee of $40 for each transfer. On the other hand, one of the greatest things about FXCM is that it doesn’t charge any deposit and withdrawal fees when you use a credit or a debit card.

Visit FXCM

Everything to Bear in Mind When Buying Bitcoin with Prepaid Cards

All in all, here is what you need to consider if you want to buy bitcoin with a prepaid card.

Prepaid card: The first thing is to buy a prepaid card and activate it. Note that some brokers accept only Visa and MasterCard issued prepaid cards, so consider this while selecting a prepaid card. After getting your card, you need to activate it, then load funds on it, after which you can use it.

Broker: One of the crucial steps in this process is to find the right broker. Here, you must take your time and do some research to find the most appropriate broker. If you don’t have time to do your own research, you can pick a broker from our list of best brokers to buy bitcoin with a prepaid card.

Fees: Note that some brokers may charge higher prices when using the prepaid card for transactions than with other payment methods. However, with a prepaid card, you will get your coins quickly, unlike wire transfer methods. So, examine all the trading and non-trading fees the broker offers and make sure there are no hidden costs before you start trading.

Security: One of the great things about buying bitcoin with a prepaid card is safety. Less card information is provided to the platform; hence, fewer data will be lost if the broker is hacked.

Bitcoin wallet: After completing your purchase, you need to find a secure place to store your bitcoin. Bitcoin wallet is the best option here on which you can keep your cryptos safe for a long time. You can create your own bitcoin wallet or order a hardware wallet to keep your coins offline.

Taxation: Bitcoin and other virtual currencies are considered taxable assets in the United States. So, when you make a profit on price movements and gain capital, you need to inform the appropriate body about your capital gain and pay the applied taxes.

Safety and Security When Buying Bitcoin with Prepaid Cards

As mentioned previously, when you buy bitcoin with a prepaid card, you provide less customer information to the platform where you are trading. In these terms, this method of buying cryptocurrencies is more secure than choosing a credit card or debit card option.

One great advantage is that it’s not connected with your bank accounts, which is significant in two ways. Firstly, when you trade, you won’t have the ability to take debts after you deplete the balance on your prepaid card account. Secondly, when a third party gets access to your card, they can only use the amount left on the card but won’t access your accounts.

However, when you trade with top brokers, it’s a very rare thing to be hacked. When recommending a brokerage account, security is one of the crucial factors we consider. We basically select brokers that use secure SSL protocols to keep your information safe and ensure your payment security.

How to Store Bitcoin on a Crypto Wallet

While some crypto exchanges don’t offer a brokerage account and require you to transfer your coins directly to a personal wallet, others provide it. In any case, you need to create a Bitcoin wallet as long as keeping your coins on your exchange account is not safe. A Bitcoin wallet is a place where you can keep your coins safely like when you keep your cash in a leather wallet.

Still, we should not understand this literally, as long as all bitcoins exist only on the blockchain network. To put it more simply, Bitcoin wallets store your access to the part of the blockchain where your coins are stored. As such, you get private keys for your bitcoin wallet through which you can get access to your BTC, see the amount you own and transfer your coins. These keys are the gates to the blockchain, so you need to be careful not to lose them or share them with anyone else. Otherwise, your bitcoins would be at risk.

Essentially, you can store our BTC on two types of wallets – software apps and hardware devices. Software wallets, also known as hot wallets, are apps that we can install on our phones or computers. Software wallets are more secure than our brokerage accounts but less secure than hardware devices. However, a software wallet can be a good choice if you trade frequently.

In contrast, a hardware device is a physical equipment that helps to store your crypto offline. You can, therefore, order a hardware bitcoin wallet, create private keys and store our cryptos for the long-term without fearing that someone can hack our coins. Again, you should always keep our keys safe and not lose them as we will not have access to it without those keys.

Buying Bitcoin Anonymously with Prepaid Cards

A prepaid card is also an excellent option to buy bitcoin anonymously. There are some peer-to-peer marketplaces where you can buy bitcoin without verification, and you can use a prepaid card instead of a credit or debit card. The problem is that purchasing bitcoin anonymously is somehow tricky. As long as you don’t go through the verification process, your card details are less secure.

When you use your prepaid card, which is not linked to your other accounts, you give fewer details. Even if someone gets access to it, you will risk less money than in the case of credit or debit cards.

To buy bitcoin anonymously with a prepaid card, in the first place, you need to find a platform that allows buying without verification and accepts payment with a prepaid card. Paxful is one such marketplace where you can buy bitcoin directly from the seller. You can use you email address to create an account on Paxful and complete a purchase. Still, we should note that Paxful has limitations on how much bitcoin you can withdraw per day without verification.

Taxation on Bitcoin Earnings

If you trade bitcoin, you obviously do that to profit from price movements. If you are lucky enough, you will end up with more capital than you invested in bitcoin beforehand. And like for every income, the taxes are applied to cryptocurrencies too. Bitcoin and other virtual currencies are treated as property by the US IRS. With that said, bitcoin is taxed in the same way as property is taxed in the United States.

The taxes differ depending on the period you hold your bitcoins. According to this classification, there can be short-term capital gains and long-term capital gains. Short-term capital gains are made in less than a year, while in the case of long-term capital gains, you hold your bitcoin more than a year before selling. In the second case, taxes are lower than in the previous case.

Conclusion

In conclusion, buying bitcoin with a prepaid card is becoming a more popular method among investors. Though there may be higher fees applied for using this method, it seems to be a more convenient and easier method in many ways. One major factor is that you cannot spend more money than your prepaid card owns. Security is another critical factor as long as you provide fewer details to the broker.

One of the challenges that may come across using this method is to find a good broker that allows you to buy bitcoin with a prepaid card. It’s a problem as not all of the best brokers accept this payment method. Coinbase is the most popular exchange that supports prepaid cards. In addition, we have researched the market and collected other good brokers you can find in our list.

But before making the final decision, you need to carefully examine all the trading and non-trading fees the broker charges and be sure you can cover all the expenses. If you have finally decided to buy bitcoin with a prepaid card, you can use our complete guide, in which we explain the whole process step-by-step.

FAQs

How to buy bitcoin with a prepaid card?

To buy Bitcoin with a prepaid card, you need to find a broker or a cryptocurrency exchange that operates in your country and accepts prepaid card transfers. After selecting the platform, you need to sign up for an account, deposit funds, and start trading.

Where can I buy bitcoin with a prepaid card?

To buy bitcoin with a prepaid card, you need to find a broker or P2P marketplace that allows transfers with your card. All the six brokers we mentioned in our guide - OKX, Bybit, Coinbase, Coinmama, CEX, FXCM, support Bitcoin and accept payments with a prepaid card.

How to buy bitcoin instantly with a prepaid card?

If you want to buy bitcoin with prepaid cards instantly, the time of execution depends on the trading platform you use. There can be brokers at which it takes days to complete your transaction, but top brokers usually do it within minutes or at least hours. Coinbase allows you to buy bitcoin instantly with a prepaid card.

Is it safe to buy bitcoin with a prepaid card?

Buying bitcoin with a prepaid card is actually safer than using a debit or credit card for this purpose. You can hardly be hacked on a good-regulated brokerage platform, but even if that happens, less customer information will leak as a result.

What brokers accept prepaid cards for buying Bitcoin?

All the brokers included in our accept prepaid cards. You need to look at their fees and select the one that suits you trading needs.

What are the advantages of buying Bitcoin with a prepaid card?

Buying bitcoin with a prepaid card is convenient and easy as long as you get your coins instantly, unlike wire transfer method when you sometimes wait for days. Another good advantage is that even if you cannot resist the temptation to buy more bitcoin, you cannot spend more than your prepaid card holds. It's not linked to any of your other bank accounts, so the card cannot withdraw money from there. And last but not least, it's more secure, as you provide fewer details. Plus, if your card is hacked, the hacker can only use the money you have on it but won't have access to your checking accounts.