How to Buy Bitcoin with PayPal in 2024 – Safest Methods Revealed

As cryptocurrencies gain popularity, many people are looking for ways to buy Bitcoin, the most popular digital currency. PayPal, a popular online payment network, is a straightforward way to purchase Bitcoin.

This article will walk you through the process of buying Bitcoin with PayPal, providing step-by-step instructions to help you complete the transaction smoothly. We also explore some of the key metrics in terms of low fees, safety, and processing times.

Why Buy Bitcoin with PayPal?

To begin this guide on how to buy Bitcoin with PayPal, let’s explore some of the reasons why this payment method is popular with crypto investors.

High Security

PayPal facilitates one of the safest ways to buy Bitcoin online. This is because investors are not required to type in credit card details into their chosen crypto exchange.

Instead, investors simply need to sign into their PayPal account. Account logins are processed via an encrypted pop-up box. This means that crypto exchanges cannot see the email address or password used to log in.

Once logged in, the investor’s payment details will already be linked to their PayPal account. As such, the investor can complete their Bitcoin purchase without needing to expose their sensitive financial information.

Buyer Protection

Another safety net when exploring how to buy Bitcoin with PayPal is the Buyer Protection Scheme.

This will come in handy if the investor has issues with the crypto exchange. For example, if the exchange charges higher fees than was originally quoted. Or, if the buyer doesn’t receive the Bitcoin in their wallet.

Either way, the PayPal Buyer Protection Scheme can help investors recover their funds.

Here’s how it works:

• Let’s say an investor buys $1,000 worth of Bitcoin with PayPal via a crypto exchange
• The investor doesn’t receive the correct amount of Bitcoin, and the exchange won’t provide further assistance
• Within 60 days of making the payment, the buyer raises a claim with PayPal
• PayPal will then investigate the transaction and ask the buyer for supporting documentation
• In the meantime, PayPal will freeze the funds from the exchange’s e-wallet account

If PayPal determines that the dispute is valid, they will deduct the funds from the exchange and return the money to the buyer.

This offers peace of mind to investors who might be wary of buying Bitcoin online.

Fast Deposits

Another benefit of using PayPal to buy Bitcoin is the speed of the purchase. Just like debit/credit cards, PayPal transactions are processed instantly.

This means as soon as the deposit is approved, the funds will be credited to the buyer’s exchange account. In contrast, bank account payments can take several days to arrive.

Speedy Withdrawals

Just like deposits, PayPal offers one of the fastest ways to withdraw funds from a crypto exchange.

For instance, once the crypto exchange approves the withdrawal, the funds will leave their PayPal account instantly. Within seconds, the funds will arrive in the buyer’s PayPal account. This is because PayPal does not need to use third parties to process the transaction.

This isn’t the case with debit/credit cards or bank account withdrawals.

For instance, it’s likely that at least two financial institutions are involved when withdrawing funds from an exchange and into a bank account. The transaction will also need to go through a domestic or international payment network, such as ACH or SWIFT. This can delay the process by several days.

Low Fees Are Available

PayPal often falls within the same bracket as debit/credit cards when depositing funds into a crypto exchange. By this, we mean that fees are high to counter the added risks of a chargeback.

For example, Coinbase charges nearly 4% on PayPal deposits.  While on Crypto.com, PayPal deposit fees amount to 2.1%.

Where to Buy Bitcoin with PayPal

Still searching for the best site to buy Bitcoin with PayPal? Some of the key metrics to look for include fees, minimum deposits, processing times, and trading commissions.

Below, we review the best crypto exchanges to buy Bitcoin online with PayPal in 2024.

1. Kraken – Complete Near-Instant Payments with PayPal, 2.4% Fee per Transaction

With the Kraken exchange, users can buy Bitcoin instantly with a PayPal account. This popular trading platform was founded in 2011 and launched its proprietary crypto exchange in 2013. Since then, Kraken supports 220+ cryptos, provides multiple payment options, and offers leverage trading opportunities. 

Since Kraken has only recently rolled out PayPal as a payment method, this feature can only be availed using the mobile application. PayPal can be used by members of the United Kingdom, and most European countries. Notably, users are required to pay a 2.4% fee per transaction when using PayPal. 

Users can transfer up to $1,000 every day by using this payment method. Along with Bitcoin, Kraken supports top cryptos such as Ethereum, USDT, Solana, and Cardano. Through the Kraken Pro platform – users can start trading cryptos by paying a fee of just 0.26% per transaction. The fee reduces as your 30-day trading volume increases. 

Comparatively, users must pay a much higher fee when buying cryptos instantly. The standard Kraken account charges a 1.5% instant fee on cryptos, and a 0.9% fee when trading stablecoins.

The platform also supports up to 5x leverage trading for retail clients. Higher leverage is offered to retail clients.

A safe and secure exchange, Kraken is one of the few big crypto platforms to have never faced a security breach or hacking. It stores 95% of all assets in cold storage and implements AML and two-factor authentication (2FA) features to protect the user’s assets. 

2. Exodus – Web3 Crypto Wallet With Multi-Chain Support and Built-In Swaps

Exodus Wallet is an excellent option for all crypto enthusiasts as it offers a simple way to access your assets no matter which device you use. There’s a mobile app for iOS and Android, a desktop app for Windows, Mac, and Linux and a browser extension for Chrome and Brave.

Within the wallet, you can buy Bitcoin with PayPal, with a card, or with a bank transfer. Thanks to its cross-chain swap, users can exchange their Bitcoin with any supported cryptocurrencies, including Ethereum, Solana, and all meme coins and cryptocurrencies built on these blockchains like Bonk, Dogwifhat, and many more.

Those looking to earn passive income can use the wallet’s staking feature where you can stake SOL, ADA, and MATIC. Of course, the annual percentage yield (APY) could be higher if using a third-party service for staking, but for the simplicity of staking within the wallet, it could be worth it.

With its NFT and Web3 support, crypto enthusiasts who want to take advantage of the DeFi sector can connect their Exodus Wallet to apps like Aave and Compound Finance to use for yield farming or NFT trading.

3. Crypto.com – Instantly Deposit Funds With PayPal at a Fee of 2.1%

Crypto.com is also one of the best places to buy Bitcoin with PayPal. Before getting started, users will need to open a Crypto.com account and download the app for iOS or Android. This is because PayPal payments are only supported by the app and not the main desktop exchange. After completing a quick KYC process, PayPal deposits can be made instantly.

The process is fast and safe, although fees are higher at 2.1%. This works out at $21 for every $1,000 deposited. Once the deposit lands in the Crypto.com account, users can proceed to buy Bitcoin. Crypto.com charges trading commissions of just 0.075%. We found this to be one of the lowest in the market. After completing the Bitcoin purchase, users have several options.

For example, some investors leave their BTC tokens in their main Crypto.com wallet. Those who prefer non-custodial wallets can download the Crypto.com DeFi app. This gives users full control of their private keys. Alternatively, some investors will deposit the BTC tokens into a Crypto.com savings account. While this yields passive income, yields are currently limited to 1.5% annually.

4. Bitstamp – Established Bitcoin Exchange With 0% Commission on the First $1,000 Traded  

Next up is Bitstamp – one of the most established Bitcoin exchanges in the market. Launched in 2011, Bitstamp supports dozens of cryptocurrencies. This includes Bitcoin, Ethereum, Dogecoin, Solana, and Litecoin. The fee structure at Bitstamp varies widely depending on the payment method used. For example, while ACH transfers are free of charge, PayPal deposits cost 4%. This is also the case with debit/credit cards.

That being said, Bitstamp makes up for this with highly competitive trading commissions. For example, there are no commissions to pay when trading under $1,000 per month. This brings the overall cost down considerably, especially for those trading small amounts. Do note, however, that a 0.4% commission will kick in when exceeding monthly volumes of $1,000.

Nevertheless, We like that Bitstamp is available on standard desktop browsers and as a native mobile app. The latter is available on iOS and Android. Moreover, Bitstamp keeps 95% of client-owned digital assets in cold storage wallets. We also like that users can whitelist their devices. Bitstamp also offers a ‘Pro’ platform for seasoned traders seeking advanced trading tools.

5. Coinbase – Beginner-Friendly Crypto Exchange Supporting PayPal Payments 

Coinbase is one of the top crypto exchanges that support PayPal payments. While we like Coinbase for its user-friendly dashboard, regulated status, and solid security controls – it’s one of the most expensive options in the market. This is because buying Bitcoin with PayPal costs 3.99%. This is the same rate as using a debit/credit card.

Moreover, selling Bitcoin back to US dollars will cost 1.49%. All that being said, Coinbase offers a safe and trusted way to buy Bitcoin with PayPal. For example, Coinbase is regulated in the US and is now listed on the NASDAQ exchange. Coinbase also offers institutional-grade security tools, such as IP and device whitelisting – not to mention two-factor authentication.

Moreover, Coinbase makes the Bitcoin investment process frictionless. It rarely takes more than 10 minutes to buy Bitcoin with PayPal. This includes the KYC process, as documents are verified instantly. Coinbase is also suitable for building a diversified portfolio. It supports over 100 cryptocurrencies, covering popular altcoins like Ethereum, Litecoin, Uniswap, and Dogecoin.

Offer: Sign up and get up to $200 in crypto¹

Terms: ¹Valid for new users who make a cryptocurrency purchase on Coinbase. Limited while supplies last or Coinbase revokes this incentive at its sole discretion. Coinbase reserves the right to change the terms, eligibility criteria, and payouts for all incentives at any time, for any reason. Void where prohibited or if Coinbase determines that the customer is not eligible for the offer. Terms apply.

Is PayPal a Good Place to Buy Bitcoin?

So far, we have discussed how to buy Bitcoin with a PayPal balance on leading crypto exchanges. That said, PayPal also allows verified users to buy Bitcoin directly on its website.

In this section, we explain why electing to buy Bitcoin via PayPal isn’t the best option.

High Trading Commissions 

The main issue with buying Bitcoin directly on PayPal is its high fees. The e-wallet provider charges fees based on the amount purchased.

The lowest fee available is 1.50% per slide. This requires a minimum purchase of $1,000. For trades between $200 and $1,000, the fee is increased to 1.8%.

Any Bitcoin purchases below $200 attract a flat fee. This works out at a higher percentage commission.

For example, buying $25 worth of Bitcoin will cost $1.99. While this might not sound like a lot, this works out at a commission of almost 8%. Similarly, buying $5 worth of Bitcoin costs $0.99. That’s a commission of nearly 20%.

Hidden Spreads 

Another issue with the pricing structure on PayPal is the spread. This is the difference between the bid and ask prices of Bitcoin.

Now, to find out what spreads are charged, PayPal redirects users to its terms and conditions.

• Deep within the PayPal terms and conditions, it states that it “may include an estimated spread of one-half of one percent (0.5%)“
• It then goes on to state that the spread can be higher or lower than this figure.
• However, it will not “disclose the spread we earn on each transaction“.

As such, we found that PayPal is not transparent enough for our liking. Crucially, investors will not know what spreads they are paying when buying and selling Bitcoin.

Withdrawal Minimums

Also hidden deep within the PayPal terms and conditions is the minimum amount of Bitcoin that can be transferred to another wallet.

This stands at just 0.001 BTC, or about $70 based on current Bitcoin prices. As such, if an investor buys less than 0.001 BTC, they won’t be able to withdraw the tokens to a private wallet.

Buying Bitcoin On PayPal vs Buying Bitcoin Using PayPal on Crypto Exchanges

Now that we have discussed the drawbacks of buying Bitcoin on PayPal, let’s explore the benefits of using a crypto exchange instead.

Trading Tools

Crypto exchanges offer significantly more trading tools than PayPal. At a minimum, this will include live pricing charts.

In most cases, crypto exchanges offer analysis tools, such as technical indicators. This enables investors to make informed decisions before buying or selling Bitcoin.

Much Wider Range of Cryptocurrencies 

PayPal offers access to just four cryptocurrencies; Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. This won’t appeal to investors that exposure to a much wider range of projects.

Leveraged Products 

While only suitable for experienced traders, many crypto exchanges offer access to leveraged products.

PayPal only offers basic spot trading services without margin or leverage.

How to Buy Bitcoin with PayPal on Kraken – Tutorial

In a step by step guide, we will now explain how to buy Bitcoin with PayPal on Kraken in 2024.

Step 1: Open a Kraken Account

Visit the Kraken website and select the “Sign up” button. Use a unique password and email to open an account.

To use PayPal, you must first verify your account. Upload an ID document. This should take a few minutes to fully verify your account.

Step 2: Select Bitcoin 

From your “Home” tab, select “Buy Bitcoin”. Enter the amount you wish to spend and select the order type: buy at the current price, buy at a specific price, or make recurring purchases.

Select PayPal from the payment methods, if available.

Step 3: Buy Bitcoin

Review the order and complete the purchase. You must have an active PayPal account to use this feature.

At the moment of writing, PayPal is available on Kraken for UK and EU clients (excluding Hungary and Croatia).

Conclusion

When using the right crypto exchange, buying Bitcoin with PayPal is fast and cost-effective. At Kraken the process is simplified thanks to a robust interface, which is why it tops our list.

References 

• https://www.paypal.com/us/webapps/mpp/paypal-safety-and-security
• https://www.fiscal.treasury.gov/ach/
• https://www.swift.com/
• https://coinmarketcap.com/alexandria/article/coinbase-accepts-paypal-purchases-in-u-s-but-itll-cost-a-lot
• https://www.nasdaq.com/market-activity/stocks/coin
• https://money.cnn.com/2015/01/06/technology/security/bitcoin-bitstamp-hacked/
• https://www.paypal.com/us/legalhub/cryptocurrencies-tnc#fees-pricing
• https://www.paypal.com/us/cshelp/article/paypal-cryptocurrency-faqs-help565
• https://www.paypal.com/us/cshelp/article/where%E2%80%99s-my-withdrawal-help456
• https://coinmarketcap.com/currencies/bitcoin/

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Kane Pepi

Editor

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Kane Pepi

Editor

Kane Pepi is an accomplished financial and cryptocurrency writer who has an extensive portfolio of over 2,000 articles, guides, and market insights. With his expertise in specialized subjects such as asset valuation and analysis, portfolio management, and financial crime prevention, Kane has built a reputation for providing clear explanations of complex financial topics. He holds a Bachelor's Degree in Finance and a Master's Degree in Financial Crime, and is currently pursuing his Doctorate degree, which focuses on investigating the complexities of money laundering in the cryptocurrency and blockchain technology sectors. Kane's wealth of knowledge and experience in the field make…

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