You can instantly buy bitcoin with a bank account by following these steps: open an account on the bank’s website, get verified, link a bank card to your account, and buy BTC using the bank’s app.
Over the past few years, cryptocurrencies have been some of the most profitable assets. The average daily volatility of most coins is 2-3%. Time periods daily volatility higher than 10% occur quite frequently. Everyone can earn money on cryptocurrencies. All you need is to have a bank account.
There are several options for buying bitcoin with a bank account:
In this review you will learn:
Cryptocurrency exchanges;
Digital banks;
Brokerage platforms.
The pros and cons of each of these options are discussed in this review. Traders Union also covers a step-by-step algorithm for buying ВТС through a bank account using examples of a digital bank and broker.
Start Trading Crypto Now with ByBit!In 2021, the cryptocurrency market reached unprecedented highs, crushing the records of 2017. Prices of many Top 100 coins recorded more than 10x growth compared with the beginning of the year, showing several surges and drops in between.In several months, smart investors managed to make more than 1,000% in profits. Exchanges accounted for over 90% of trading volume. January 2023, however, brought an event that radically changed the views of investors: the FTX exchange suddenly announced bankrupt.
Prior to its bankruptcy, FTX was one of the top 5 crypto exchanges by trading volume and a leader by the volume of cryptocurrency futures. In November, CoinDesk reported that the owner of FTX had increased the equity of his company Alameda Research by using FTT (FTX tokens) and customer money. Further investigation showed that over $4 billion had been withdrawn from FTX.
This event had a radical impact on investors’ priorities. FTX is not the first case of a major exchange bankruptcy. The same happened to Mt.Gox after it got hacked and to BTC-E following a case of fraud. That is why investors looked into other ways to invest in cryptocurrencies. One of them is to buy BTC with an account at a digital bank.
A digital bank (neobank, online bank) is a platform that provides banking services on the internet. In most cases, digital banks do not have physical branches, which allows them to charge lower fees compared to traditional banks. Most services for private customers are the same as in classic banking: deposits, debit and credit cards, international payments, exchange transactions, , home mortgage, etc. And since recently, digital banks have been offering access to cryptocurrency trading.
Benefits of cryptocurrency trading with digital banks:
Regulation. Digital banks operate in full compliance with licenses from financial regulators that also control traditional banks. This includes opening financial statements, undergoing audit, and meeting other legal requirements. Many European neobanks hold licenses from one of the most reputable regulators, the FCA (UK). Exchanges hold nominal licenses, which is shown by the examples of some of the largest exchanges that “suddenly” went bankrupt: QuadrigaCX (Canada), Africrypt (South Africa), Thodex (Turkey), and FTX.
Account security and protection. Both digital banks and exchanges use reliable protection methods, such as two-factor authentication, SSL protocols, and facial and fingerprint recognition. However, crypto exchanges, as well as user accounts, get hacked regularly. Digital banks have not been hacked so far.
Fees are low due to the absence of physical offices and corresponding administrative expenses.
Insurance coverage. In case of a hack, crypto exchanges compensate for losses at their own discretion. Digital banks, in accordance with regulatory requirements, allocate money for independent insurance funds that offer insurance coverage in the amount of 50,000-100,000 US dollars or euros (depending on the fund), in force majeure cases.
Marketing and a wide choice of trading instruments are the strengths of crypto exchange, but they can alsocollapse any moment. Reliability supported by constant control by regulators is the strong side of digital banks.
Best Crypto-Friendly Banks You Should KnowDisadvantages of cryptocurrency trading with a digital bank:
Limited choice of coins. On average, digital banks offer no more than 10 coins for trading, whereas crypto exchanges from the Top 20 have over 100-150 altcoins and tokens in their listings.
Lack of trading instruments. Digital banks offer only one type of service: buying or selling cryptocurrencies and holding them in crypto accounts. So far, only several neobanks offer full-featured trading platforms, but over time digital banks will add this functionality as well.
Transfer time. Transferring bitcoins to a bank account may take from a few minutes to several hours.
For those who are interested in long-term investing in top coins, these drawbacks are insignificant. Reliability of a digital bank – the guarantee that the platform will not disappear at some point together with client money – remains the key factor of choice.
This section contains overviews of the best neobanks. You will discover their services, pros and cons, as well as find their respective links where you can register and open an account with a few clicks.
This is an all-inclusive digital bank for retail customers and businesses. The bank has a proprietary mobile investment platform SoFi Invest you can use to open positions for 26 cryptocurrencies, including ВТС. Access to cryptocurrency trading is only available in the USA. The Coinbase crypto exchange is the bank’s partner (liquidity provider).
Advantages of the SoFi digital bank:
Low fees. Among neobanks, SoFi has some of the lowest fees for cryptocurrency investing: 1.25% of the transaction amount.
Instant transfers in crypto or fiat currencies.
Low entry threshold. The minimum transaction amount is $1-10 depending on cryptocurrency.
$100 bonus is given to every investor within 7 days of registration if bonus conditions are fulfilled.
You can instantly buy bitcoin with a bank account by following these steps: open an account on the SoFi website, get verified, link a bank card to your account, and buy BTC using the SoFi Invest app. BTC will be transferred to your SoFi account. Using your SoFi account, you can also sell cryptocurrencies and withdraw USD to a bank card. Direct cryptocurrency withdrawal to external wallets is not provided.
This is a convenient family digital bank, which provides financial products aimed at optimizing expenses and savings. Over 90 tokens and altcoins paired with 30 currencies are available for investing.
Advantages of the Revolut digital bank:
Low entry threshold. The minimum amount of investment in cryptocurrencies is $1.
100% guarantee of money protection. Cryptocurrencies are held in cold wallets of Revolut’s authorized entities.
Issuance of crypto cards for everyday cryptocurrency payments. It is possible to make payments in any cryptocurrency accepted by the recipient.
Interest accrual. Interest accrues on the “change” sent to a client’s storage wallet.
To invest in cryptocurrencies with a Revolut bank account, take the following steps:
Create an account on the Revolut platform. Include a phone number, where the link for the mobile app installation will be sent.
Get verified. Provide screenshots or photos of documents that confirm your identity and residential address.
Deposit funds into your account using a bank transfer, bank card, or Apple Pay/Google Pay.
Buy cryptocurrency. The bank offers three options:
1. Instant buy in a few clicks (exchange).
2. Placement of a pending order: you set the desired price, and as soon as it is reached the transaction is triggered.
3. Buying cryptocurrency in equal time intervals (averaging strategy).
The cryptocurrency you bought will be displayed in your account balance in the app.
It is possible to buy ВТС using a bank account with a Forex broker. This is another alternative to crypto exchanges. A Forex broker is a digital platform that serves as an intermediary between an investor and the international over-the-counter market where cryptocurrencies are traded among other assets.
Benefits of buying BTC with a brokerage account:
Trading platform. In most cases, it’s МТ4, МТ5, or cTrader. Unlike a regular account, a trading platform allows you to analyze charts in different time frames, use technical and chart analysis tools, and automate trading through expert advisors, i.e., not just buy/sell cryptocurrency but conduct full-fledged speculative trading.
An opportunity to earnmoney on cryptocurrency price drop. You can not only buy but also sell cryptocurrency, even if you don’t have it, i.e., make profit from short positions.
Leverage. Want to buy more crypto but don’t have enough money? Brokers offer leverage up to 1:1000.
Important! When using a broker, you don’t buy cryptocurrency itself, but earn from CFDs. In this case, the procedure of buying bitcoin with a bank account is as follows:
1. Register on a broker’s website and get verified;
2. Open an account and deposit funds into it with a Visa/Mastercard or direct bank payment;
3. Install a trading platform and link your brokerage account to it;
4. Open transactions.
Money can be withdrawn to the card with which you deposited funds into your account.
This section contains overviews of the best neobanks. You will discover their services, pros and cons, as well as find their respective links where you can register and open an account with a few clicks.
This platform is considered to be one of the best for cryptocurrency trading thanks to its functionality and attractive trading conditions.. The broker was founded in 2007 and, in over 15 years of its work, has attracted more than 10 million customers in 140 countries.
eToro’s advantages:
Attractive trading conditions: leverage up to 1:30 (for beginners as per regulatory requirements) and a proprietary multi-functional trading platform, which excels MT4 and QUIK in features and instruments. The minimum deposit is $200.
Ready-made balanced cryptocurrency portfolios intended for various types of strategies.
eToro is the world’s largest social trading platform. If you don’t know what to do with technical and fundamental analysis, but still want to profit from volatility of cryptocurrencies, you can opy transactions of professional traders. Their trading statistics are publicly available, and every trader can be contacted personally.
Besides cryptocurrencies, the broker offers over 1,000 other trading assets, including securities. For residents of the U.S. and Europe, eToro acts as a direct regulated broker, which allows them to directly buy real securities on stock exchanges. For residents of other countries, CFD trading is available.
eToro holds licenses from the FCA (UK) and CySEC (Cyprus).
This is an all-inclusive broker that offers over 20 currency pairs, commodities, over 20 cryptocurrency pairs, and over 12,000 stocks. The company was established in 2009 and has more than 3.5 million clients in 169 countries.
Advantages of RoboForex:
Attractive trading conditions for beginners: the minimum deposit is $10; leverage is up to 1:1,000; variable spreads start from 0 pips in ECN accounts and from 1.3 pips in standard accounts.
Cent accounts for developing skills and practicing strategies.
Several dozen payment methods for residents of almost any country. The broker works with many local banks in Europe, Asia, and Latin America, as well as with electronic payment systems.
No deposit or withdrawal fees. Withdrawal processing time is within 1 business day.
1. On the home page of the bank’s website, click “Open an account”.
How to buy BTC with a RoboForex bank account
2. Enter registration data: email address, login, and phone number to which you will link your account.
3. Get verified: provide a photo of an ID document and confirm your residential address. The list of required documents is included in the “Verification” section. Confirm your phone number and activate two-factor authentication.
How to buy BTC with a RoboForex bank account
4. In the “Funds” section of the top menu, select “Deposit Funds”. Select a bank card as a payment method and follow the instructions.
How to buy BTC with a RoboForex bank account
5. In the top menu, select “Accounts” and open a trading account. Download the MT4 platform from the RoboForex website, install it and link your account to it.
How to buy BTC with a RoboForex bank account
Open BTC positions on the platform and make money. You can also open a demo account for practice. Deposits into it are not required.
NOTE! You do not invest in BTC, but in Bitcoin CFDs. Changes in the cryptocurrency price will be displayed as an increase or decrease in the deposit amount in USD. You can close transactions on МТ4 at any moment.
Buying ВТС with a bank account means using a bank account to send money. And for that, you need a platform that will act as an intermediary between you and counteragents and will allow you to link your bank account to it and hold cryptocurrency in it. Crypto exchanges, digital banks, or brokers can serve as such a platform
Crypto exchanges have significant downsides: they occasionally get hacked, and due to the lack of control by regulators they sometimes go bankrupt. Client accounts get blocked quite often. Compared to crypto exchanges, digital banks and brokers are more reliable. If you are interested in long-term investing, go with digital banks. If you are interested in short-term trading, open an account with a broker.
Digital banks are only beginning to enter the cryptocurrency investment segment. This service is provided by a relatively small number of neobanks, including Revolut and SoFi. Cryptocurrency CFDs are offered by the vast majority of Forex brokers. Some of the best brokers are RoboForex, FxPro, and eToro.
Unlike crypto exchanges, there have been no cases of digital bank hacking and subsequent bankruptcy. There have been cases of broker bankruptcy, but the money was returned to customers from compensation funds. That is why there are two main risks:
Market risk. Cryptocurrency price may change in the direction opposite to an open transaction.
Human factor. Phone numbers and passwords to accounts or emails may become known to unauthorized persons.
Don’t open unknown letters, don’t follow unknown links, don’t enter personal information on questionable websites, activate two-factor authentication and change passwords regularly.
First, you need a bank account and a card you will use to make payments. To buy BTC with a digital bank, open an account on its website and link a card to it. To buy BTC with a broker, open an account with it, deposit money into it via a bank payment, download a trading platform and open transactions on it.
Digital banks charge fees in the form of a percentage of the transaction amount. Some banks may have a monthly subscription fee. Broker fees are markups and swaps. A markup is a broker fee added to the spread. A swap is a fee for keeping a position open overnight.
Oleg Tkachenko is an economic analyst and risk manager having more than 14 years of experience in working with systemically important banks, investment companies, and analytical platforms. He has been a Traders Union analyst since 2018. His primary specialties are analysis and prediction of price tendencies in the Forex, stock, commodity, and cryptocurrency markets, as well as the development of trading strategies and individual risk management systems. He also analyzes nonstandard investing markets and studies trading psychology.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).
