Bitcoin is a type of virtual currency that you can use for digital purchases or you can trade like stocks or bonds. To buy and sell cryptocurrency including Bitcoin, you need to use a bitcoin exchange.
The best cryptocurrency exchanges are secure, cost-effective, quick to set up, easy to use, and accept a variety of funding sources. Here are our picks for the best places to buy bitcoin.
Best Places to Buy Bitcoin
Coinbase: Best Overall
Why We Chose It: If you are brand new to the world of bitcoin and cryptocurrency, Coinbase is an excellent place to start due to support for a number of popular cryptocurrencies, a strong security track record, and reasonable fees.
A recognized leader in the U.S. with a relatively long track record in the industry and more than 35 million verified users
Reasonable fees and support for a large number of popular currencies
Majority of user assets stored in secure offline cold storage
Spread pricing means fees can be high for large transactions
High fees for debit card transactions
Coinbase is a large cryptocurrency wallet provider and exchange based in San Francisco. It boasts over 35 million users in over 100 countries, making it a popular choice for cryptocurrency enthusiasts, investors, and traders. Coinbase claims it holds over $25 billion in assets and has facilitated more than $320 billion in trades. You can trade dozens of currencies, including Bitcoin at Coinbase.
Coinbase charges several fees, which it discloses upfront when entering a transaction. Those include a flat per-transaction fee and a spread of about 0.50%. Fees vary based on the funding method going up to 3.99% when you use a debit card to buy. Serious users may want to upgrade to Coinbase Pro, which uses its own pricing model.
Coinbase offers strong security through Coinbase Vaults, two-factor authentication, and its use of offline storage for the vast majority of client assets.
Best for Beginners: eToro
Why We Chose It: eToro is our choice for beginners thanks to an easy-to-use platform and practice accounts that let you test out buying bitcoin without risking real funds.
An easy-to-use web platform suitable for those new to bitcoin
Free practice accounts with $100,000 in virtual money
Copy-trading system to learn from other users
0.75% spread fee for bitcoin purchases and higher fees on other currencies
If you’re looking for a simple and focused platform that allows you to buy bitcoin while learning more about the cryptocurrency ecosystem, eToro could be right for you. Those new to bitcoin will appreciate the simple and straightforward platform and CopyTrader system that allows you to mimic trades from others on the platform.
You can test the waters with a $100,000 virtual account with no risk to your actual money when you sign up. Once you're comfortable, you can enter a live trade with real dollars. Just take note of the 0.75% spread price for bitcoin and higher fees for other currencies.
Best for No Cost: Robinhood
Why We Chose It: Robinhood is our choice for cost thanks to commission-free bitcoin trades.
No commission to buy or sell bitcoin
Platform very similar to stock trading
Short list of supported currencies
No option to withdraw bitcoin to a crypto wallet
When you pay fees of 0.5% or more to buy and sell, you’re giving up a big portion of your potential bitcoin gains right off the top. Robinhood is best known as a commission-free stockbroker, but you can buy and sell bitcoin with no commissions as well. If you already have some experience with stock market investing, buying cryptocurrencies with Robinhood will likely feel familiar, a bonus for those new to bitcoin.
Robinhood Crypto is technically a separate account that you use alongside your Robinhood stock investment account. It supports a fairly short list of currencies, but that could be fine for many bitcoin buyers.
Best Instant: CoinMama
Why We Chose It: We picked Coinmama because it offers instant bitcoin purchases with many payment options and high limits.
Instant order delivery
Bitcoin delivered to any crypto wallet
Quick account setup and many funding options
Complex fee structure
Additional 5% fee for instant delivery
No support for ACH bank transfers
If you want to own bitcoin as quickly as possible and already have a bitcoin wallet, Coinmama may be your best choice. Coinmama features fast account setup and verification. Once you’re logged in, you can buy bitcoin instantly using several payment methods, though there may be a fairly high price tag for those instant purchase privileges.
You can use a credit or debit card to buy one of nine different currencies. When you place an order, the funds are instantly verified with your connected card by Coinmama, then the cryptocurrency you chose is deposited into your crypto wallet. Those in the UK and EU have additional instant funding options that are not available in the US.
Hopefully, they’ll add US-based ACH payments as a funding method, though the nature of electronic transfers in the U.S. wouldn’t allow for instant purchases with this funding method. But if you have a credit or debit card and don’t mind the fees, Coinmama allows you to buy coins with any bitcoin wallet instantly.
Best for Interest and Borrowing: BlockFi
Why We Chose It: We picked BlockFi because it turns your cryptocurrency into a bankable asset with options for borrowing using bitcoin as collateral and lending to earn interest.
Deposit crypto into an interest-earning account that pays up to 8.6% APY
Use your valuable bitcoin as collateral for a loan in U.S. dollars
No added fees for cryptocurrency trades
BlockFi encourages using loan proceeds for investments, which is a risky strategy
Loan interest rates as high as 9.75%
If you have a lot of bitcoin and want to do more with it without selling, you should know about BlockFi. BlockFi enables you to earn interest when you deposit your bitcoin to an account. If you want to unlock your bitcoin without selling, you can also use existing bitcoin as collateral for a loan, but take note of the interest rates of 4.5% to 9.75% and the required 2% origination fee. You can also buy and sell bitcoin and other cryptocurrencies with no added trading fees.
Early adopters to the cryptocurrency bandwagon or with major holdings can earn serious interest with rates up to 8.6% APY (as of January 2021). BlockFi also has a new rewards credit card that will pay you in bitcoin, which shows plenty of innovation to come from this unique crypto exchang.
Best for Privacy: Bisq
Why We Chose It: We like Bisq’s decentralized features that improve privacy and anonymity when buying and selling bitcoin through an open-source desktop app.
Decentralized peer-to-peer network improves privacy
Software to buy and sell is open source
No registration required
Potential for slow transactions
Not ideal for active traders
For those drawn to the anonymity provided by bitcoin, Bisq may offer what you’re looking for. Bisq is a decentralized exchange that doesn’t require any signup or account. That means you can use Bisq to buy and sell with nearly complete privacy. The required Bisq desktop app is open source and free to use.
Bisq supports a wide range of payment methods, including bank transfers, Chase QuickPay, Popmoney, Zelle, and Western Union. Trade fees range from 0.05% to 0.70%, depending on what you’re doing and how you pay.
Bisq is best for those with at least a little crypto experience.
|Exchange||Why We Chose It||Trade Fee|
|Coinbase||Secure, reputable, and easy to get started||Transaction fee of $0.99 to $2.99. Other fees may apply.|
|eToro||Virtual account and CopyTrader allow you to learn with less risk||Spread-based pricing – 0.75% for Bitcoin|
|Robinhood||Commission-free bitcoin trades||No commissions or fees|
|Coinmama||Instant purchases with a credit or debit card||Commissions up to 3.90%. Other fees may apply.|
|BlockFi||Ability to earn interest and use bitcoin as loan collateral||No added commissions or fees|
|Bisq||High-privacy decentralized exchange||Up to 0.70%|
What is a Bitcoin Exchange?
A bitcoin exchange is a digital marketplace where you can convert currency like U.S. dollars into bitcoin. Many exchanges that support bitcoin also support other digital cryptocurrencies.
Every bitcoin exchange uses its own pricing and platform, which may instantly draw you to one exchange over another. Advanced bitcoin users may be interested in more details about the type of exchange. For example, some exchanges use centralized systems and user accounts while others are decentralized with a focus on privacy. Depending on what you’re trying to accomplish, you may prefer one type of exchange over another.
How Does a Bitcoin Exchange Work?
Bitcoin exchanges connect buyers and sellers and act as a middleman, or a broker, in some cases. When you buy bitcoin using a bitcoin wallet, the transaction is recorded on the Bitcoin Blockchain, which publicly tracks bitcoin-based transactions. In some cases, exchanges may transact on your behalf and not deliver bitcoin to an external digital wallet.
Are Bitcoin Exchanges Legal?
Bitcoin exchanges are generally considered legal in the United States. However, it is your responsibility to report capital gains to stay on the right side of the law for your annual tax filing.
What Are Some Differences Between Bitcoin Exchanges and Wallets?
Bitcoin exchanges are a place you can buy and sell bitcoin. In many cases, the exchange also includes a wallet, which is the “account” that holds your cryptocurrency. When you use a centralized exchange online or through a mobile app, the exchange will effectively hold the bitcoin on your behalf.
Bitcoin also enables you to use external wallets outside of an exchange. These include computer-based and web-based “hot wallets” and offline “cold wallets” that work kind of like a USB security fob. If you buy bitcoin at most exchanges, you have the option to transfer your coins to any bitcoin wallet.
What Are Some Differences Between Bitcoin Exchanges and Mining Software?
Bitcoin mining software is a type of application that helps maintain the Bitcoin Blockchain. Every transaction on the blockchain is public and recorded on countless computers around the world. When a transaction takes place, computers called miners race to record the transaction and get a small fee, which is paid by those who make the transaction.
When you run a bitcoin miner, you can effectively “create” your own bitcoin if you win the race and get paid the transaction fee. To improve your chances, you can join a pool with other miners. However, be aware that mining is very power-intensive and could wind up costing you more than it makes you. Bitcoin mining is best for those who are very computer savvy.
Is Buying Bitcoin Safe?
Buying Bitcoin is safe whenever you use a vetted and respected platform. It’s important to research any platform where you’re considering purchasing Bitcoin before you decide to take the plunge. In terms of Bitcoin being a safe investment, the value fluctuates more frequently than many other traditional investments. If you’re looking to support a decentralized method of making payments, Bitcoin can be valuable. However, there’s no guarantee or insurance protecting any value of what you're purchasing.
How Can I Buy Bitcoin?
If you’re looking to buy bitcoin, follow these steps to get started:
- Pick an exchange and wallet provider: The first step is to pick a place to buy and store your bitcoin. The easiest and fastest way to start is to choose an exchange that also offers secure bitcoin storage.
- Open an account: Once you’ve picked your favorite exchange, you will most likely need to open an account and supply basic personal information. Some decentralized exchanges don’t require an account, but you’ll need an existing wallet and more technical know-how to use this type of exchange.
- Fund your account: If you choose a provider that allows you to deposit fiat current (USD, EUR, GBP, etc.), you’ll probably have to fund your account before you can make an order. You may be able to buy right away with a debit or credit card, but beware of extra fees.
- Place an order: Now it’s time for the big moment. Place your order and wait for it to fully execute. Because blockchain processing takes some time, your purchase may not be instant. There are many factors that can lead this to take anywhere from a few minutes to over an hour to complete.
Once your order is done, you should see your new bitcoin in your bitcoin wallet or account. Congratulations! You're a cryptocurrency owner.
How We Chose the Best Places to Buy Bitcoin
We looked at more than a dozen of the best places to buy and sell Bitcoin online and settled on the top six places based on a number of factors. These factors included the history of the exchange, customer reviews, the fees each charges, the strength of features for each digital wallet, and the speed at which you can buy Bitcoin.
Coinbase. "About Coinbase." Accessed Jan 8, 2021.
Coinbase. Supported Cryptocurrencies. Accessed Jan 8, 2021.
Coinbase. "Coinbase pricing and fees disclosures." Accessed Jan, 8 2021.
eToro. Copy top-performing crypto traders. Accessed Jan 8, 2021.
eToro. "Our Fees." Accessed Jan 8, 2021.
Robinhood. "Robinhood Crypto." Accessed Jan 8, 2021.
Coinmama. "Cryptocurrencies we offer." Accessed Jan. 8, 2021.
Coinmama. "Buy with a bank transfer." Accessed Jan. 8, 2021.
BlockFi. "Earn more for your crypto." Accessed Jan. 8, 2021.
BlockFi. "Crypto Loans." Accessed Jan. 8, 2021.
BlockFi. "Fast trading without the fees." Accessed Jan. 8, 2021.
BlockFi. "BlockFi." Accessed Jan. 8, 2021.
Bisq. "Exchange, Decentralized." Accessed Jan. 8, 2021.
Bisq. "FAQ." Accessed Jan. 8, 2021.