9 ways to Buy Bitcoin with a bank account
By: Ofir Beigel | Last updated: 11/10/20
Buying Bitcoins with a bank wire is probably the best way to go in order to get the cheapest exchange rate possible. Depending on where you live in the world there are different exchanges that will be best suited for you. In this post we will cover the main reputable exchanges that supply bank wire services.
How to Buy Bitcoins with a Bank Account Summary
- Visit Coinbase and open an account
- Go to “Settings” – “Linked accounts”
- Add your bank account
- Go to “Buy/sell”
- Buy Bitcoins
*eToro users: 75% of retail CFD accounts lose money. Your capital is at risk
If Coinbase doesn’t work for you, or you’d like to review additional options keep on reading. Here’s what I’ll cover:
- Frequently Asked Questions
Pros: Multiple payment options, no deposit fees, wide selection of cryptocurrencies
Cons: Relatively high fees on brokerage service (can be avoided by using the trading platform)
CEX.io is one of the oldest companies around, founded in 2013. Today the company provides two main services – a brokerage service and a trading platform service. The brokerage service is usually more expensive but easier to use. On the other hand, the trading services are cheaper but can be confusing.
The company supplies the option for SEPA transfers within the EU and bank transfers for countries outside the EU. All bank account transfers are 0% in fee for depositing money.Visit Cex.io Read review
Pros: Good support, relatively quick process
Cons: Limited states in the US
Coinmama is a brokerage company that accepts a wide range of bank transfer options such as SWIFT (Worldwide), SEPA (Europe), Fedwire, Faster Payments, Sofort and more. The company has been around since 2013 and is considered to have good reputation and fast service.
If you use a bank transfer with Coinmama’s service you can save up to 5% of the processing fee compared to its credit card transactions. Furthermore using bank transfers let you enjoy higher spending limits compared to credit card purchases.Visit Coinmama Read review
Pros: Intuitive interface for beginners, low fees
Cons: Not available worldwide, mainly suited for price speculation
eToro is a pioneering trading company that puts an emphasis on cryptocurrency. It supplies users with an easy to use trading platform for investing in cryptocurrencies. eToro is more suited for price speculation than actually buying the coins, as withdrawing them to your wallet is more complicated then with other platforms.
eToro accepts Swift transfers worldwide and ACH transfers within the US. eToro also offers a mobile wallet for trading, sending, and receiving funds.Visit eToro Read review
75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. CFDs are not offered to US users. Cryptoassets are highly volatile unregulated investment products. No EU investor protection.
Pros: Fast transfers within the US and EU, low fees
Cons: Slow support, Not available worldwide
Coinbase is one of the pioneering companies in the Bitcoin ecosystem and has been around since late 2012. Coinbase supplies brokerage services to many countries around the world (meaning they sell you Bitcoins and other cryptos directly and not through a trading platform).
For US customers Coinbase allows you to connect your bank account via ACH bank transfer. For European customers Coinbase will also allow you to buy Bitcoins with a SEPA transfer.
For all countries Coinbase supports (100+ in total) there is a 1.49% fee on wire transfer purchases.Visit Coinbase Read review
Pros: Multiple payment options, intuitive interface, relatively low fees
Cons: Not available worldwide, fees “hidden” inside the exchange rate
Bitpanda was founded in 2014 and supplies brokerage services for Bitcoin plus other cryptocurrencies to countries within the Eurozone and a handful of other countries. The company accepts SEPA transfers from European countries.
You can only deposit 3 major fiat currencies via bank transfer – Euro, Swiss Franc, and GBP but not USD. Fees are unclear on Bitpanda since they are incorporated into the exchange rate. This means that the price already represents the fees Bitpanda take for themselves.Visit Bitpanda Read review
Pros: Best option for underserved emerging markets
Cons: Limited country support
For emerging markets there is the option of Luno (formerly known as BitX). The company supports many European countries and also Indonesia, Malaysia, Nigeria and South Africa. Deposit fees depend on the country and vary between 0% to 5%.
For trading, the fee also depends on your currency and can range between 0.2% to 1%.Visit Luno Read review
Pros: Reputable exchange, low deposit and trading fees
Cons: No brokerage service, can be confusing for beginners
Probably the oldest exchange on this list is Bitstamp that was founded in 2011. The exchange in Luxembourg and offers trading services worldwide. There’s a 0.05% deposit fee for bank account transfers but SEPA transfers are free of charge.
Trading fees on the platform vary depending on your monthly volume, for most uses the fee will be between 0.25% and 0.50%. Bitstamp does not offer brokerage services so you will need to know your way around trading platforms in order to use the site.Visit Bitstamp Read review
Pros: Reputable exchange, low deposit and trading fees
Cons: No brokerage service, limited options for bank account transfer, historically a lot of reported downtime
Another vetran exchange is Kraken. Headquartered in San Francisco Kraken is known to be one of the largest Bitcoin exchanges in terms of euro volume and liquidity. It operates across the United States (with the exception of New York and Washington State due to regulation) and Canada, as well as in the European Union, Asia, Africa and South America.
SWIFT deposits are available for US dollars while SEPA deposits are available for EU members. Deposit fees can vary but usually have a maximum of $5.Visit Kraken Read review
Pros: High liquidity, reasonable fees
Cons: Complex interface, history of hacks
Bitfinex, located in Hong Kong, is one of the world’s biggest Bitcoin exchanges. The company supports bank account transfers worldwide and takes a 0.1% deposit fee for incoming wire transfers. The company supplies only a trading platform and no brokerage services. Trading fees depend on volume and start at 0.2%.Visit Bitfinex Read review
Pros: Largest GBP market for Bitcoin, established company
Cons: Limited to the UK
Coinfloor is a London-based bitcoin exchange established in early 2013. The company mainly supports UK countries. Deposit fees vary depending on the currency deposited and trading fees vary staring from 0.3%. British Pounds can be deposited via Faster Payments for a £2.50 fee while BACS, CHAPS, SWIFT and SEPA carry a hefty £30 deposit fee.Visit Coinfloor Review coming soon
Why should I use a bank account instead of a credit card?
People who want to buy large amounts of bitcoin or don’t have any access to credit or debit cards will probably look for buying Bitcoins with their bank account.
Since there’s substantially less risk involved for exchanges when people purchase Bitcoins with their bank account, the fees for such a process are significantly lower. Unlike credit cards, Bank transfers are considered irreversible and reduce the risk of chargeback.
So if you’d buy $1000 from Coinbase via a bank transfer you’d pay $14.9 in fees, while if you bought the same amount with a credit card you’d pay $39.9 in fees. As you can see you can save 50% and more when using a wire transfer.
Also, buying limits are much higher when using a bank transfer to fund your account than when using a credit or debit card.
On the downside, bank transfers are usually less convenient to execute and take a longer amount of time to process since the transfer needs to clear several banks on its way to the exchange.
How do I transfer Bitcoins to my bank account?
You can’t transfer Bitcoins to your bank account. Bitcoins can only be held inside a Bitcoin wallet. If you would like to “cash out” your Bitcoins you’ll need to exchange them back to fiat currency (dollars, euros etc.) and then withdraw that currency to your bank account.
Do I need a Bank account to buy Bitcoins?
No, you don’t have to have a bank account in order to buy Bitcoins. There are a variety of methods to buy Bitcoins without a bank account.
Can you buy Bitcoins at a bank?
No you can’t. You’ll have to use dedicated Bitcoin exchanges in order to buy Bitcoins.
If you’re thinking about buying large amounts of Bitcoin or don’t have any access to credit cards you should probably use one of the methods above. Keep in mind that some banks may require additional info about the nature of the transaction and may also collect additional fees for the transfer itself.
In my opinion, if the purchase amount isn’t large, you’re better off using your credit card. It will cost a little more but the coins will arrive quicker and there will be much less hassle in the buying process.
If you have any questions about the process or the exchanges feel free to ask them in the comment section below.