How to buy Bitcoin with a Credit Card: Beginner guide

Key takeaways

• Buying Bitcoin with a credit card offers nearly instant transactions and convenience, but it costs you higher fees and potential blocked transactions from card providers.
• Centralized exchanges like Coinbase and Kraken are the easiest reputable platforms on which to buy Bitcoin with credit cards.
• To protect yourself during transactions, only use trusted exchanges and use security protocols like 2FA.
• Credit card purchases can offer some extra protection against fraud compared to other payment methods, but purchase limits can be more restrictive

Looking for the quickest and easiest way to purchase Bitcoin? Buying Bitcoin with a credit card is almost instant on many platforms. Before you start your digital shopping spree, you should take a few minutes to learn how to buy Bitcoin (BTC) with a credit card in the most efficient way. 

However, if you’re not careful, you could end up damaging your credit score and even getting scammed out of your investments. 

Below, you will find a step-by-step process for purchasing Bitcoin on a reputable exchange, plus learn how to protect yourself from unnecessary financial distress along the way. 

Why use a credit card for Bitcoin purchases?

Buying Bitcoin via a credit card is almost instant on major exchanges. It can be performed easily on a mobile device or web, allowing buyers and traders to quickly take advantage of market moves.

Often, the cryptocurrency exchanges that accept credit cards are regulated and will use high levels of encryption. These exchanges will require Know Your Customer (KYC) and Anti-Money Laundering (AML) checks for security and compliance.  

Purchasing Bitcoin with a credit card is a beginner-friendly option for new cryptocurrency investors already familiar with using their credit cards for online transactions. There may be some protection from the credit card company if something goes awry.

Will buying Bitcoin with a credit card affect my credit score?

Every purchasing decision you make with your credit card will have an effect on your credit score, either positive or negative. Crypto is likely to do more harm than good to a credit score. Here’s why:

• Particularly with large Bitcoin purchases, it will increase your credit utilization ratio. Banks don’t reflect kindly to high credit utilization above 50% of a credit limit.
• Traditional banks and card issuers classify crypto purchases as cash advances and risky transactions. 
• Payment history still remains the key factor in your credit score. Credit issuers may well frown upon regular Bitcoin purchases.

Did you know? Over 85% of retailers across the world accept credit cards, while only 25% of online retailers accept crypto payments. Credit cards are still more widely accepted; however, crypto acceptance is growing quickly. 

Where to buy Bitcoin (BTC) with a credit card

You could buy Bitcoin with credit cards on centralized crypto exchanges (CEXs). Well-known global platforms like Coinbase, Kraken and Binance all enable their users to buy Bitcoin with a credit card. Adding to this, you can use instant buy features to purchase Bitcoin with a credit card without depositing fiat currency into your account first. 

However, the regional availability for CEXs varies from platform to platform. This is usually dependent on local regulations and compliance. So, before picking a platform, you should check if it operates in your location and with your card issuer.

What if a credit card transaction is declined?

Many traditional banks actively block crypto-related transactions, which means you might find your credit card declined when attempting to purchase Bitcoin or other cryptocurrencies. This is often due to the bank’s policy against facilitating cryptocurrency transactions. 

However, there is good news: Modern fintech banking alternatives, such as digital banks and crypto-friendly payment platforms, are increasingly supportive of cryptocurrency purchases, offering a smoother transaction experience.

Aside from bank restrictions, other reasons for declined crypto transactions can include fraud prevention measures, where the transaction is flagged as suspicious. Additionally, exceeding your credit card’s spending limit or encountering issues with your card’s authorization settings can also lead to a declined transaction.

Is there a limit to how much Bitcoin can be bought with a credit card?

The purchase limit for Bitcoin varies for each individual and is influenced by two main factors. First, the spending limit on your credit card, which is determined by your bank or card issuer. Second, the crypto exchange you’re using will impose its own purchase limits. 

For first-time buyers, these limits can be relatively low — often just a few hundred dollars. However, depending on the exchange and your account history, these limits can typically be increased to $5,000 or more per week if needed.

You should also be aware of the credit card Bitcoin purchase fees that can include: 

• Exchange fees: Typically 3%–5%…