How to buy Bitcoin with PayPal
How to buy Bitcoin with PayPal
Bitcoin

How to buy Bitcoin with PayPal

By Marco Cavicchioli - 4 Apr 2020

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Buying bitcoin with PayPal is not particularly easy. Actually, it is PayPal Holdings Inc. itself that badly tolerates people using its services to purchase cryptocurrencies. 

After an initial phase, in the now distant 2014, when the company decided to collaborate with companies such as BitPay or Coinbase to allow online retailers in particular, to accept bitcoin payments, in recent years the company has instead consistently hindered the use of its payment services to buy bitcoin. 

For example, in 2018 it made it possible to link a PayPal account to a Coinbase account, but only for fiat money withdrawals from the exchange, and not for the purchase of cryptocurrencies by using the Paypal account. 

As the Coinbase policies clearly state: 

“Customers are only able to use PayPal to withdraw or sell, and transaction availability depends on region. Coinbase does not support the ability to purchase digital currency using your PayPal account”. 

However, there are some online services that allow paying for bitcoin purchases via PayPal, although very few of them are available. One of them, VirWoX, which used to offer this possibility in the past, has closed down

To date, the fastest way to do so is through LocalBitcoins, which still allows Paypal payments. 

LocalBitcoins is a platform that connects individual bitcoin sellers with individual buyers, and they can make payments in different fiat currencies using different gateways, including PayPal itself. 

However, since the introduction of the mandatory identity verification for all buyers and sellers, trading volumes have decreased. Nevertheless, it is still a valid way to buy bitcoin by paying through PayPal. 

Another system is to use Wirex. It is actually officially possible to connect a Wirex card to a Paypal account, so as to use it both to buy bitcoin and to withdraw euros, but as the company expressly states “future updates to this service may affect compatibility”

In other words, the company is not able to guarantee that this feature will remain active in the future, because PayPal could always decide to no longer allow the connection with the Wirex card, especially in light of the reluctance to allow customers to use their accounts to buy cryptocurrencies. 

Even on Paxful, it is possible to use PayPal as a payment method. Paxful is a platform similar to LocalBitcoins, and although its trading volumes are still lower than those of its main competitor, they have been growing lately, perhaps due to the fact that on LocalBitcoins they are decreasing after the introduction of the mandatory KYC. 

According to what is stated on Paxful’s official website, this platform greatly simplifies the process of purchasing BTC with PayPal, allowing to acquire bitcoin in less than an hour. 

These methods make it possible to acquire BTC that can then be stored in a proprietary, non-custodial crypto wallet. 

However, there are also other platforms that allow buying bitcoin by paying with PayPal, but that do not necessarily allow the withdrawal of BTC to send them to a non-custodial wallet. 

One of these platforms is eToro, which allows making deposits in fiat currencies even using a PayPal account

Once the deposit has been made, fiat currencies can be used to buy bitcoin, but eToro is primarily a trading platform for trading derivatives such as CFDs, rather than a real exchange where it is possible to buy BTC and then withdraw them. 

Nevertheless, eToro also allows buying BTC and withdrawing them to a proprietary wallet, although this is not the main functionality of the platform.

There are other similar trading platforms, such as Investous, IQ option or Trade, but they generally allow the purchase of bitcoin-based CFDs, and not the cryptocurrency directly. 

Another way, although a little more complex, is to use wallets that allow this, such as Square or Revolut, either by connecting them to a PayPal account, or simply sending funds from the PayPal account to the wallet, and then using them to purchase bitcoin. 

Since Paypal does not have a very good tolerance for users using their accounts to buy or sell cryptocurrencies, moving the funds to other services that allow it, and then proceeding with the purchase of BTC via these other services, probably protects against disputes. Thus, rather than buying bitcoin by paying with PayPal, it would be advisable to make the purchase using wallets such as Square that allow paying in fiat currency without problems, although only after moving the fiat money from PayPal to the wallet that allows it. 

 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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