You can’t name another cryptocurrency that’s even close to being as valuable as Bitcoin, let alone being more valuable. And that’s why Bitcoin trading comes with certain risks.
Even if we completely disregard the volatility of Bitcoin, which is a major point to consider, you still have to pay all those taxes and fees.
No matter how small the percentage of these fees is, when you view the whole transaction from a bird’s eye, you’ll understand how much that small percentage is taking away from you.
Every trader makes a few common mistakes when they start. And one of the mistakes is that they don’t research the marketplace and process of transaction thoroughly.
Due to their obvious lack of consciousness, they end up losing money that they could hold on to. This guide is designed to help you understand and know better ways of exchanging Bitcoins.
At the end of this guide, you’ll learn the cheapest way to buy Bitcoin. But let’s answer some frequently asked questions first!
Why Would You Look for Cheaper Options?
At first, the transaction fee of five to twenty percent won’t seem much to you. But let’s consider the price of each Bitcoin. We all know that Bitcoins have great value. In 2020, one Bitcoin amounts to approximately nine thousand and three hundred dollars.
And if you consider, for example, ten percent of that amount, that’s nine hundred dollars. Imagine losing nine hundred dollars!
As the value of Bitcoins is increasing with each passing day, you’re sure to lose more and more money in the future. And that’s why you should look for a marketplace or a broker that costs the least transaction fee. Remember, that one dollar might turn into a thousand any day!
What’s a Good Strategy of Finding Cheaper Alternatives?
Just as there are broker websites, there are platforms that compare the prices of the different types of coins. You can resort to services like Coinmarketcap or Go Cryptomarket. These websites are designed by experts in this industry.
These platforms display the real-time prices that popular brokers offer. But how can you use this to your advantage? Pretty simple!
Observe the prices for a few days before you make the purchase, and calculate the overall profitability of the brokers. Then complete the purchase from the broker that offers the most profit.
Best Brokers to Buy Bitcoins in 2020
Let’s get started.
eToro is a crypto marketplace that’s being regulated from the United Kingdom, Australia, and Cyprus. With eToro you can enjoy commission-free trading. You need only one day to open an account.
Although eToro isn’t that good for Forex, it’s amazing for cryptocurrency trading. There’s a feature called social trading.
With social trading, you can monitor and copy the strategies followed by other traders. The withdrawal fee of eToro is only five dollars!
And you have to deposit only two hundred dollars to get started. eToro has USD as the base currency. You can link your credit card, debit card, or e-wallet with this platform for easy transactions.
- Commission-free stock trading
- Social trading feature
- It takes only a day to open an account
- Low withdrawal fee
- Has only one base currency
- Withdrawal might take time
Coinbase is much older than eToro, and as it’s been around longer, it has a larger community. Coinbase has more than thirty million customers worldwide. Coinbase offers a brokerage service that allows users to trade and exchange cryptocurrencies. New users tend to go for Coinbase, as this is very trusted.
However, Coinbase isn’t perfect. One of the major flaws of Coinbase is that it doesn’t allow access to coins even to the owners. You won’t be getting any private key with Coinbase. Coinbase also has a pro version that’s very suitable for experienced traders.
You’ll get a mobile wallet from Coinbase. You can use it on both iOS and Android platforms. It’s got a low transaction fee. Transaction fees are as low as 1.49%, which escalates to 3.99% if you’re transacting through credit cards.
However, the fees on Coinbase Pro are much lower. You’ll have to pay only 0.25% as a transaction fee.
If you’re a new trader, we’ll recommend you to go for Coinbase. However, if you’ve got some experience and avid knowledge about crypto trading, Coinbase pro should be your go-to.
- Lots of withdrawal options to choose from
- Mobile platform for day to day transactions
- Intuitive interface
- Low transaction cost
- Has an amazing pro version
- Has one of the worst customers supports
- Withdrawals and deposits can take up to three days depending on traffic
- Supports a limited amount of currencies
Based on Israel, Coinmama is a crypto brokerage service that’s available in more than 180 countries as of now. Coinmama doesn’t support any other currency than Bitcoin.
Again, you can’t deposit money in Coinmama. This means the only option left for you is purchasing coins through credit cards or debit cards.
Coinmama has a high transaction rate. The usual rate is 5.9%. If you transact with a credit card or a debit card, the transaction will cost you another five percent on top of that.
So, overall, you can expect to spend an amount of around eleven percent. By now, it’s clear that Coinmama isn’t the cheapest way to buy Bitcoin. Then why’d we included this?
Unlike the other brokers mentioned in this list, Coinmama offers great customer support, fast transactions, a simple and intuitive user interface, and a verification program that works fast!
Although it’s not cheap, if you want a platform with a hundred percent security, easy and full access to your coins, and fast withdrawals and deposits, Coinmama is the brokerage you should settle for.
- Amazing customer support
- Intuitive interface
- Fast deposits and withdrawals
- High transaction fees
If you’re a beginner, CEX might be a great platform for you to start transacting. CEX not only comes with low transaction fees, but they offer an amazing interface as well.
CEX allows the user to transact using his credit cards, wire transfer, ACH transfer, or SEPA transfer. CEX offers a trading platform where you can meet other traders and exchange your currency with them. Or you can exchange using the brokerage CEX provides.
CEX takes up a transaction fee of only 0.25%. However, some people think that the transaction rate of CEX is high. They are wrong. They use the “instant cash” feature, which costs a transaction fee of up to 7%! So, don’t use this feature if you want to save up some cash.
- Available in almost every country
- Three base currencies are USD, GBP, and EUR
- Extremely safe and secure
- Intuitive user interface design
- Might be a bit complex for beginners
Kraken has been in the industry for quite some time, as it’s started way back in 2011. Kraken is based solely in the United States, they follow American rules. And as it abides by the rules, the platform is considered to be very secure. If you trade on a professional level, Kraken is great for you!
There are only a few countries that can’t access Kraken. So, before you start, you better read the list of supported countries first. Although Kraken can’t be accessed by citizens of every country, this platform is surprisingly considerate towards foreign citizens.
When it comes to transaction fees, Kraken has one of the least. If you transact less than fifty thousand dollars a month, you have to pay only .16% makers fee. On the other hand, the taker fee is only 0.26%. The more you transact in volume, the less you’ll have to pay.
Kraken is undoubtedly one of the most secure brokerage platforms. The owners of Kraken claim that they have approximately 95% of the data stored in offline cold storage free from any sort of intrusion. You can use the two-factor authorization of Kraken if you wish to take your security to the next level.
- One of the lowest transaction rates
- Extreme security as most data are stored offline
- Available in most countries
- Requires verification of ID
- The user interface isn’t intuitive
Crypto-trade can take a toll on all of us. It isn’t easy, and it certainly isn’t risk-free. Then again, those who can see the benefits of Bitcoin exchange and will know each nook and corner can turn the tide to his or her favor.
If you’re new to mining, it’s great that you read this so early. And even if you’re trading for a few months, wondering why you can’t make any profit, it still isn’t too late, my friend.
Now that you have the idea about the cheapest way to buy Bitcoin, you can apply the knowledge to increase the profits!