Cryptocurrencies and credit cards operate from different platforms, which makes the transaction unique. The early years of Bitcoin’s existence saw traditional financial organizations discourage their customers from purchasing digital currencies. They based their concern on Bitcoin’s uncertainty as a medium of exchange. However, they are slowly embracing it, but with specific pointers to guide the transactions. What matters is that credit cards can now directly buy digital currencies.
Things to Look Out for When Purchasing Bitcoin Using Credit Card
1. Shady Crypto-trading Sites
There are very many online sites trading in cryptocurrency. They offer currency exchange from Dollars to cryptocurrencies. However, before settling down to one crypto-site, do background research on the site, its validity and check on the customer’s review. Visit a credible consumer protection site to understand its viability.
Shady crypto-trading sites can steal your credit card access information and empty funds from your card. Since digital currencies aren’t regulated, the first and last stop of safety is you. First, ensure the trading site is legit and credible before linking and investing your funds in any digital currency.
Some of the credible sites to buy cryptocurrencies using credit cards include Coingate, Coinbase and Binance.
2. Low Credit Score
The adrenaline witnessed when trading in cryptocurrency is refreshing, especially when the market forces favor you. It gives excellent prospects since every move within the financial markets contributes to the price of digital coins. However, Crypto-trading works well if you invest using your surplus funds.
Market volatility and uncertainties can cause a downward spiral of the whole trade. If you have low credit score, the chances are that you used credit money to trade. It might lead to more debts since most credit cards treat crypto trading as a cash advance.
Buy Bitcoin or any other cryptocurrency with funds you can afford to lose. You might feel the loss, but it won’t be as hard as paying interest on a cash advance that didn’t yield the intended proceeds.
3. Sensational Purchase
Purchasing digital coins with a credit card is an expensive affair, thanks to the high charges on the transaction. A single credit card transaction charges an exchange rate fee, commission to the online trading platform and the credit card. It amounts to about 10.9% in total deductions. With such a significant amount, Buy bitcoin with credit card and be sure of its returns on investment before committing.
Research well on the market volatility, foreseen market growth and other prevailing financial economics. These elements can give you a forecast that will guide your purchase. Do not buy because it is fashionable to do so. Buy because it makes sense and will give you the intended output.
4. Using Several Browsers
When you buy cryptocurrencies with any credit card, the card’s number links the card to the online trading site. Avoid using multiple browsers to transact since it exposes you to cybercrime. Use the browser on your personal computer to transact, and if possible, avoid saving the login passwords on the browser.
Most credit card companies have strict policies on crypto-trading as it exposes their online security to online hackers. They time out the transaction after some time to reduce the chances of unwanted intrusion. If they notice any unusual activities on the account, they can disable the login page until they are sure of the account’s security.