Can I Buy Crypto With a Credit Card?

Smiling young African American woman doing some online shopping with a credit card and laptop while sitting on her living room floor.
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With cryptocurrency sparking interest among investors across the globe, you might be intrigued by the idea of joining the crypto craze using your credit card. Unfortunately, buying digital currency with a credit card can be challenging. Coinbase, one of the world’s cryptocurrency exchanges, doesn’t accept credit card crypto purchases.

Some cryptocurrency exchanges, such as Coinmama and, let investors use credit cards to buy crypto, but that doesn’t mean your credit card issuer allows it. The majority of U.S. credit card companies don’t permit the purchase of cryptocurrency using a credit card. Even worse, some issuers penalize cardholders with hefty cash advance fees.

The difficulty and the fees aren’t the only reasons you need to think twice before using your credit card to buy crypto. Read on to find out why.

Reasons Not To Buy Crypto With a Credit Card

There are potential downsides to buying crypto with a credit card. They include:

Hefty Transaction Fees

If you buy bitcoins with a credit card, the cryptocurrency exchange may charge you transaction fees. The exchange may also charge an additional fee to exchange dollars for the digital currency you need.

Cash Advance Penalties

The major U.S. credit card issuers, including American Express, allow cryptocurrency purchases using a credit card but treat them as a cash advance. Credit card issuers may decline crypto purchases for varying reasons — uncertainty, poor regulation and cash equivalents.

Cash Advance Fee

If your credit card issuer considers crypto purchases as a cash advance, you’ll need to pay a cash advance fee in addition to any other exchange service fees. A cash advance fee is a one-time fee charged by a card issuer for using a credit card to obtain cash.

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Typically, the cash advance fee is 3% of the total amount. For instance, if you take out a cash advance of $200 to purchase cryptocurrency, you could pay $6 to your credit card issuer with a 3% fee. Cash advances may also come with other drawbacks.

Cash Advance Drawbacks

  • Higher interest rates: Many credit card issuers charge a higher annual percentage rate on cash advances. Therefore, using a credit card to buy cryptocurrency is relatively more expensive than regular purchases.
  • Lower credit limit: Some credit cards have a specific cash advance credit limit, which may be lower than your usual credit limit.
  • No grace period: Cash advances have no grace period; they start incurring interest from the first day.

Foreign Transaction Fee

If the cryptocurrency exchange you use is based outside the U.S., you might incur foreign transaction fees. Credit card issuers often charge these fees at 1% to 3% of the transaction amount.

No Credit Card Rewards

If you buy crypto with a credit card, your purchase probably won’t earn rewards or help you attain the required spending for earning a sign-up bonus. This applies if your card issuer treats cryptocurrency purchases as cash advance equivalent.

Daily Limits

Depending on the cryptocurrency exchange, there may be a daily limit on the number of bitcoins or other cryptos you can buy with a credit card. Login to your cryptocurrency exchange account and go to settings to confirm limits.

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Other Considerations

Beyond fees, there are other noteworthy considerations when buying cryptocurrency with a credit card:

  • Credit utilization: Depending on how much crypto you purchase, your credit utilization — the ratio of your available credit to credit used could increase. A high credit utilization ratio could negatively affect your credit score.
  • Debt: Using a credit card to purchase cryptocurrency means taking on debt for a very volatile investment. If the digital currency doesn’t perform as expected, you’re still on the hook for your credit card debt.

Final Take

Buying crypto with a credit card comes with several drawbacks: hefty fees, cash advance penalties, no credit card rewards and even daily limits. It’s critical to confirm whether your cryptocurrency exchange allows credit card purchases and to be aware of all of the associated fees.

FAQ About Buying Crypto with a Credit Card

Here are the answers to some of the most frequently asked questions about buying cryptocurrencies with a credit card.
  • Can you buy crypto with a credit card?
    • Yes, but it's not easy. You'll need to find a cryptocurrency exchange that accepts crypto purchases with a credit card. Plus, the exchange might charge an additional transaction fee every time you use your credit card to buy crypto.
  • Can credit card crypto purchases affect your credit score?
    • Your credit utilization ratio, the amount of credit you use, is a primary factor in your credit score. The more credit you use, the more it affects your credit score. Making big crypto purchases uses up your available credit and quickly racks up fees, which will likely hurt your credit score.
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