How to buy Bitcoin with PayPal

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Andrew Hayward

If you’re interested in trading digital currencies, you might now be wondering how to buy Bitcoin with PayPal. US investors now have a valuable opportunity to decrease their risk exposure using this payment platform and you could benefit from this.

To find out more about how to buy Bitcoin with PayPal, read this comprehensive guide for everything you may need to know.

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Cryptoassets are highly volatile and unregulated. No consumer protection. Tax on profits may apply.

There has been an explosion of interest over the last few years in how to buy and sell Bitcoin, thanks to the strong value growth of cryptocurrency, which has helped it capture the attention of a global audience. The growth in crypto’s value, which made early adopters very rich, coupled with its innovative and disruptive nature generated a lot of coverage from the mainstream media and helped accelerate its growth across the US and beyond!

Of course, for some the buying and selling of digital currencies on crypto exchanges can be a very lucrative undertaking, others may have anxieties over the possible dangers and concerns as to how safe an undertaking crypto trading is. As many of you may already know, there has been a significant rise in the number of Bitcoin scams in recent months. As the likes of Ruja Ignatova, aka the “cryptoqueen”, gained worldwide notoriety and a place on the FBI’s most wanted list for her role in a massive crypto-fraud scam.

Thankfully for those concerned, PayPal, one of the pioneers in online payment and a bastion of the e-commerce sector, announced in August 2021 that they would support the buying and selling of Bitcoin and other cryptocurrencies. The new service was the result of a partnership with the Paxos Crypto Brokerage and was in response to growing demand from US PayPal users.

Cryptoassets are highly volatile and still lacking meaningful regulation in the US. No consumer protection. Tax on profits may apply.

Why is cryptocurrency so popular?

Even those with a cursory interest in the news will have noticed the recent rise of digital currencies such as Bitcoin, ethereum, and litecoin. It makes sense, after all many people lost faith in global finance and the established systems as a result of the global financial crisis of 2008 and the devastating impact it had on the lives of ordinary people. Naturally enough in the chaos of the fall new ways of investing and banking arose. However, it was only really in 2017 that one of these alternatives took off as many people became aware of the role digital currencies could play in the modern economy.

Since then, there has been a large rise in its value as many investors have seen its potential and also an opportunity for them to make significant gains. According to CNBC, Bitcoin is now the world’s largest digital currency, with a market value of more than $1.1 trillion.

Anyone with a credit or debit card can explore cryptocurrency investment options and potentially make large profits.

Why should I buy cryptocurrency?

One of the most obvious reasons why people buy, hold, and sell Bitcoin is that they are hoping to make an awful lot of money. In many ways the current situation is comparable to the Gold Rush of 48, as the potential to make fortunes is open to all.

If you manage to time it right and read the market, you could make a significant profit by buying and selling Bitcoin. Of course, the opposite is also true and a market downturn has the potential to wipe out a significant amount of your money if you aren’t careful.

Of course, if you want to get involved then it’s important to ensure that you’re using the best cryptocurrency platform for your needs.

What are the risks of buying cryptocurrency?

It would be wrong of me to not mention that while there can be major opportunities when buying and selling cryptocurrency, there can also be significant downsides too. Two of the biggest ones are:

Price fluctuations

The price fluctuations that make crypto attractive are something of a double-edged sword and could end up wiping out the savings of the inexperienced. While there is the potential for the value of your investment to rise significantly, you could also stand to lose out due to a poorly timed transaction, or by making the wrong bet at the wrong time.

If you are unlucky, a market downturn could wipe out a large portion of your investments and this loss of wealth could impact both your immediate circumstances as well as hinder your progress towards your financial life goals.

The threat of scams

As I mentioned in my guide about how to buy cryptocurrency, one of the biggest problems with the lack of central control and oversight is that in the unfortunate case of you falling victim to a crypto scam, there’s very little you can do to get your money back.

With the large amounts of money being traded in Bitcoin, the anonymity of accounts, and cryptocurrency’s decentralized nature, these markets can be a haven for scammers. That’s why many investors are concerned about trading in crypto.

Why is PayPal getting involved in cryptocurrency trading?

As you may have seen, PayPal recently announced in August 2021 that it will offer users the ability to buy, hold, and sell four cryptocurrencies: Bitcoin, ethereum, litecoin, and Bitcoin cash. They have partnered with the Paxos Crypto Brokerage to offer these services.

For people who are familiar with PayPal and the secure payment service they offer, crypto traders will be pleased to see that the e-payment titan is supporting this innovative new sector.

It is likely that, with PayPal now offering support for the crypto market, the interest in crypto currency trading will grow even more. Especially when one looks at the numbers, PayPal has 392 million active users, and even if there is only marginal interest among those users for crypto trading that is still an awful lot of new investors taking the plunge.

According to Jose Fernandez da Ponte, vice president and general manager of blockchain, crypto, and digital currencies at PayPal, the company decided to support crypto currency because:

“The pandemic has accelerated digital change and innovation across all aspects of our lives—including the digitization of money and greater consumer adoption of digital financial services.” Mr. Fernandez de Ponte also believes that “We expect digital currencies to play an important role in consumer payments over the longer term.”

How can using PayPal help me to buy Bitcoin?

If you’ve ever made an online purchase with PayPal, you’re probably aware of how useful it can be. Instead of directly transferring your money to a seller, PayPal deposits it in their account on your behalf. This means that if you fall victim to a scam, you can get your money back thanks to the tried and tested PayPal policy.

The move also makes it much easier to buy and sell cryptocurrency, as you can do so through a trusted outlet. All you need is a PayPal account and you can get started.

Can you buy Bitcoin with the PayPal app?

As previously mentioned, PayPal will soon offer users the opportunity to buy, hold, and sell cryptocurrencies through the PayPal app. This includes Bitcoin, ethereum, litecoin, and Bitcoin cash.

Paypal Bitcoin minimum deposit

When the feature launches, you will be able to use the new ‘Cryptocurrency tab’ to trade them to your heart’s content, with a minimum purchase and deposit of only $10.

This crypto tab in the app will also feature live price charts, which can enable you to follow the market movements of your chosen digital currencies. If you’re interested in investing in them, but want to make a properly informed decision first, the PayPal app’s crypto tab also offers introductory and educational content to bring you up to speed.

Furthermore, they are also working in collaboration with the strictly-regulated Paxos platform, so you can have greater peace of mind when buying cryptocurrency.

This new feature of their app, as well as their work in collaboration with its Crypto Checkout Service, is an important step in making cryptocurrency a more viable payment method.

Are there transaction fees when I’m buying crypto with PayPal?

While PayPal can give you invaluable peace of mind when you buy, sell, and hold Bitcoin, since you don’t have to worry about the prospect of being scammed, it does come at a price. Whenever you buy Bitcoin with PayPal, you will have to pay a small fee in order to use the service.

When PayPal’s cryptocurrency service launches, the fee structure is as follows:

Purchase or sale amount Fee
1.00 – 4.99 USD 0.49 USD
5.00 – 24.99 USD 0.99 USD
25.00 – 74.99 USD 1.99 USD
75.00 – 200.00 USD 2.49 USD
200.01 – 1000.00 USD 1.80%
1000.01 USD + 1.50%

Of course, no matter how large or small the charge is, these fees will eat into your profits, so it’s important to bear this in mind when you are trading, as it could impact your strategy. But when you consider the safety that the PayPal platform offers, these fees offer peace of mind at an extremely reasonable cost.

What are some ways that I can use PayPal to buy Bitcoin?

If you want to use your PayPal account to buy, sell, or hold cryptocurrency then there are several ways in which you can do so:

Crypto exchange platforms

One of the most obvious places to buy and sell cryptocurrency is through a crypto exchange. While many of the major ones, unfortunately, don’t accept PayPal for purchasing cryptocurrency, there are some exceptions.

For example, eToro accepts PayPal. This is great news as it means that one of the largest and best-known trading and investment companies will allow you to deposit funds into your digital wallet using the service, which can make the process simpler, faster, and easier for you.

Peer-to-peer marketplaces

Another of your main options to buy and sell cryptocurrency with PayPal is through a peer-to-peer marketplace, such as with a LocalBitcoins account. As you may know, these exchanges allow buyers and sellers to link up and trade directly.

The benefit of this system is that it allows sellers to set up their own exchange rate and choose their preferred supported payment methods. Many sellers accept PayPal payments and the site allows you to filter your search to find the ones who do, making it faster and easier to buy and sell.

Why don’t all exchanges accept PayPal?

With PayPal’s secure method of payment, which helps to protect your bank account from scammers, you might be wondering why more platforms don’t offer their services when letting you buy Bitcoin.

Ironically, the answer to this is that it is to protect you from scammers. As you may know, PayPal supports chargebacks while cryptocurrency transactions are irreversible.

This is a feature that can be exploited by criminals, as it makes it possible for them to buy Bitcoin with PayPal, complain that they never received their cryptocurrency, and then ask for a refund from PayPal. In essence it creates the possibility of a scenario where they get to keep their money and get their hands on cryptocurrency free of charge. To protect their users from this risk, only a few of the major cryptocurrency platforms accept PayPal deposits from buyers.

What are the pros and cons of buying Bitcoin in this way?

As you can see, while there are many benefits to using PayPal if you want to buy Bitcoin, there can also be some drawbacks. On balance, here are the pros and cons of the payment platform when it comes to crypto:



PayPal users can take advantage of their Buyer’s Protection, meaning that you can buy Bitcoin without fear of being scammed, as you can be refunded if you use your PayPal account for a purchase but never receive what you bought. This can be a significant weight off your mind.

Speed of purchase

Another great advantage of using PayPal is that, as long as you already have an account with them, it enables you to buy Bitcoin in a fast and convenient way. This is particularly true if you already have a linked bank account or funds in your PayPal balance.

As you might imagine, this means that you can buy Bitcoin very quickly, a real boon if you have been reading the markets and are hoping to take advantage of an anticipated market spike.

Quick withdrawals

While PayPal is obviously useful when you want to buy Bitcoin, it can also be handy for when you want to make a withdrawal. At some point, after you’ve made money through your investments, you will want to convert your Bitcoin back into cash.

When this time comes, PayPal can help to ensure that you receive your money quickly. Typically, once your crypto broker has processed your request, the funds will arrive in your PayPal account within the hour.


Transaction fees

One of the biggest drawbacks of using PayPal to buy Bitcoin is that the fees can potentially eat into the cost of your purchases by a significant amount. This means that it will take a big chunk out of the overall profit that you make through your crypto trades.

FAQs about buying Bitcoin with PayPal

Can you buy crypto with PayPal in the US?

Yes, you can buy crypto through PayPal. When their new service is launched, PayPal users will be able to buy cryptocurrency using their app. As you can probably imagine, this can give you a much greater sense of security and confidence when you buy Bitcoin.

PayPal is partnering with Paxos to deliver a new and innovative way to buy crypto in an easy and safe way.

How do I buy Bitcoin with PayPal US?

To buy Bitcoin using PayPal in the US, you have two main options. Firstly, you can buy crypto directly through PayPal’s new payment platform which allows you to see real-time currency prices so you can trade more effectively.

Secondly, you can also use one of the crypto-trading platforms that accept PayPal. For example, eToro will allow you to deposit funds straight into your virtual wallet by using PayPal, which can make the process significantly simpler and easier for you when trading.

Can I buy Bitcoin with PayPal anonymously?

As you may know, one of the main advantages of paying for things with cryptocurrency is that the transactions are anonymous, which may make you wonder if it’s the same when you buy them with PayPal.

Unfortunately, this is not the case. While some crypto-trading platforms do let you buy Bitcoin without needing to provide any proof of identification, PayPal is not an anonymous payment method.

This is because of the fact that you will need to fund your PayPal account from a bank account linked to it or with a credit or debit card. Since your payment method will be linked to your identity, it cannot be done anonymously.

A note about crypto asset regulations

Crypto assets are not regulated financial products so please be aware that trading them carries a considerable amount of risk for your capital. Cryptocurrencies and other digital financial services are also not covered by existing consumer protection laws.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

This article is for informational purposes only and does not constitute financial investment advice. All contents are based on my understanding of current legislation, which is subject to change.

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