The growth in credit card debt in connection with the purchase of cryptocurrencies is catching up with the growth of interest in the currencies themselves. After the fall in the price of bitcoin and altcoins, it will be difficult to pay for buying cryptocurrencies with credit cards. As a result, investors, facing the threat of non-payment of loans, will begin to sell off their digital assets at an accelerated pace, thereby lowering the prices of digital currencies even more. The current situation worries both bankers and exchange players.
Where can I buy cryptocurrency with a credit card
COINBASE
The largest bitcoin exchange. Credit or debit card payments for Bitcoin are capped at $ 150 or € 150 per week. The cards are allowed to be used by residents of the USA, Canada, Europe, Great Britain, Australia and Singapore. The commission for card transactions is one of the lowest for European and American users. The problem of the exchange is the long term for the payment to go through when it comes to a debit card (about 5 days), and the ability to track further transactions of the user with bitcoin. Only VISA and Master Card are accepted.
COINMAMA
The company is a broker specializing in Bitcoin and Ethereum debit and credit card transactions. The upper spending threshold is higher than the competition: $ 5,000 per week or $ 20,000 per month. To use the cards, you need to go through a complex verification procedure, but transactions are carried out within a few minutes, for which Coinmama takes a fairly high commission.
BITPANDA
A bitcoin broker registered in Austria and dedicated exclusively to European users. Works with BTC, DASH, Ripple and ETH. The user will only know that the resource charges a 5% commission at the final stage of the trading operation. There are restrictions on the types of credit cards used – only cards with 3D protection are accepted for payment.
SEX.IO
One of the oldest bitcoin exchange platforms. Works in the USA, Europe and some South American countries. The verification process is quite complicated and takes over 30 minutes. Users are usually unhappy with the relatively high commission (3.5%) and additional hidden fees. The execution process differs from most exchanges and is based on the FOK (Fill-Or-Kill) mechanism, according to which exchange orders are immediately executed or canceled if there are no counter orders of the same volume. It is for the speed of operations that CEX charges an additional fee.
How are credit cards used
According to data from exchanges, about 20% of Bitcoin buyers in late 2017 – early 2018 used credit cards. Meanwhile, more than 22.3% of them then violated the terms of payments on loans. This information suggests that, despite the fall in cryptocurrency prices, speculative operations are still popular with investors. However, now, after the correction, most of them do not end as well as before. At the same time, if earlier buyers lost their money in case of failure, now, having received the opportunity to buy on credit, they lose others. It should be remembered that operations with cryptocurrencies are credited at much higher interest rates. For example, according to Forbes, the average interest on a loan for operations with Bitcoin is 5.6%, with Ripple – 132.1%, with ETH – 36.3%. Depending on the country, the interest on the loan for such operations, according to LendEDU analyst Michael Brown, can reach 45%. In addition, companies that service credit cards can increase the percentage after the transaction, charging it for the amount that was not paid on time.