KuCoin Credit/Debit Card Payments Begins | What should be Noted when Buying a Cryptocurrency?
On February 12, the cryptocurrency exchange KuCoin, in partnership with Simplex, announced that it will launch a service that allows customers to purchase cryptocurrency with credit and debit cards. Until now, there has been only a few a cryptocurrency exchange services allowing the use of a credit card such as Changelly, but from now it can be predicted other exchanges will expand their services.
However, credit card payments have different characteristics compared to using cash and Bitcoin payments, thus it is useful to know the advantages and disadvantages. In this article, along with the attractiveness of credit card payments for cryptocurrency, we will explain the precautions when using it.
Cryptocurrency exchange KuCoin starts credit / debit card payments
KuCoin, a Singapore-based cryptocurrency exchange company, announced on February 12th, 2019 that it has launched a service that allows customers to purchase cryptocurrency using credit and debit cards. KuCoin is famous for its former Alibaba affiliated financial company engineers who are examining and listing potential currencies. Currently, about 80 cryptocurrencies are handled on the exchange, with rare coins that cannot be purchased in Japan offered for trading.
The new credit card service is targeted four coins: Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and Ripple (XRP). Two types of legal currency are accessible, the US Dollar and Euro, with most international card brands such as VISA and MasterCard being accepted.
There are other ways to buy cryptocurrency with a credit card
There are other ways to purchase cryptocurrency using a credit card besides an exchange as offered by “exchange offices.” Exchange offices provide a service that allows users to order from various transaction rates at the most advantageous price range, which “Changelly” is famous for. Changelly offers over 100 cryptocurrencies to purchase from, and the exchange fee is as low as 0.5%. In Japan, sales offices are often used to purchase Alt Coins, but spreads and other fees tend to be high. Therefore, Changelly is attracting attention among investors, and it also supports exchanges with Alt Coin to Alt Coin transactions, as well as credit card payments. It is an overseas site, but I’m glad it is also compatible for Japanese users.
On the other hand, if you use KuCoin for credit card purchases, you need a minimum purchase price of $10 or more, and the fee is 5%. At the moment, Changelly feels more user-friendly, but with KuCoin at the head, there will be more exchanges supporting credit card payment services in the future.
Pros and cons of buying cryptocurrency with a credit card
When buying cryptocurrency on an exchange, it is common to use legal currency or bitcoin until now. However, diversification of payment methods, such as with credit cards, will increase the convenience for an exchange and increase the volume of transactions. So what are the advantages and disadvantages of buying cryptocurrency with a credit card? I will explain in more detail below.
Earn points through 24/7 support
If you make a payment with a credit card, you can use it 24/7 to buy items online. In the case of bank transfers, the acceptance time is limited to 9 to 15 o’clock, so reflection of payment may be delayed. However, you can make immediate purchases with a credit card when you want to buy cryptocurrency. In addition, the benefit of a credit card is that points are earned according to the amount of money spent. For example, a few percent of the amount spent can be converted to miles, or redeemed for discount coupons that can be used with other companies.
Be careful with credit payment fees
If you use a credit card, you will also be charged a fee when you buy a product at a store. Of course, if you buy cryptocurrency, you also may need to pay a fee to the credit card company/bank. This fee is separate from the fees paid to the exchange or exchange office. Fees vary depending on the credit card company, but approximately 10% of the payment amount on average. In other words, it is more expensive than purchasing on an exchange using legal currency or bitcoin.
The advantage of using a credit card is that it can be settled immediately, so it is recommended to use it only when you want cryptocurrency immediately. With the convenience of credit card purchases, please be safe and try to avoid overuse.
The KuCoin news is an announcement of a partnership with the Fintech company Simplex, which provides a service allowing users to exchange cryptocurrency directly with credit and debit cards. Credit card deposit services are also available on domestic exchanges, but from now on there will be more exchange services like Changelly. Since purchasing cryptocurrency with a credit card is usually more expensive, I recommend using it sparingly and methodically.