How to Buy Crypto with Amex

Over the last decade, the popularity of cryptocurrencies has grown. Increased interest in the nascent asset class has led to new exchanges popping up, making it easier to purchase crypto. But how do you buy crypto with Amex?

Payment options to purchase cryptocurrencies have expanded. Methods like bank transfers, cash, debit, and credit cards have grown in acceptance.

Despite this, major credit card issuers in the US, like TD Bank, Capital One, and PNC Bank, have blocked crypto transactions. They claim that they're risky assets for their customers. Other financial service providers, like American Express, have maintained support for buying crypto through their credit cards. This is not without caveats, however.

The American Express Crypto Broker

American Express has maintained a cordial relationship with crypto. It allows customers to deposit money using their Amex card to fund their crypto account. This means that American Express provides the services of a broker that acts as a middleman, allowing you to execute trades while charging small fees.

It is simple to purchase cryptocurrencies on the market with credit cards that permit the transaction. According to a LendEDU poll, 18.15% of Bitcoin investors claim to have funded their accounts with credit cards.

However, you must find a third-party cryptocurrency exchange that accepts American Express if you want to purchase Bitcoin and other cryptocurrencies using it. First, open an account and then fund it with a credit card.

What you must know before you buy crypto with Amex

Brief History

The headquarters of American Express is located in New York City's Three World Financial Center. The company was established in 1850 in Buffalo, New York, as an express mail service. Later, it expanded its offerings to include credit cards, traveller's checks, and money orders. More than 130 countries are served by American Express.

American Express is governed by state banking regulations in the United States and has a license from the US Department of Treasury Financial Crimes Enforcement Network to operate as a money transmitter. American Express is also a Federal Deposit Insurance Corporation (FDIC) member.

What to know

Credit card issuers are generally still wary of crypto. Hence, there are caveats surrounding Amex's facilitation of crypto purchases.

First, most exchanges limit large purchases of crypto assets when using a credit card. This is to protect users from possible fraud and not allow them to max out their credit cards by funding their account.

Amex limits users to $200 worth of Bitcoin daily and up to $1,000 per month.

Second, credit cards like Amex also offer an additional level of security that other modes of payment don't provide.

Safeguards like fraud protection and the ability to call and reverse purchases help customers secure their funds.

Third, the cost of purchasing crypto with credit cards differs from exchange to exchange. You will pay a transaction fee of 3.5% of your purchase plus $0.15 when using 247Exchange. When you consider that Coinbase charges 3.99% and Coinmama comes in at almost 6%, this is one of the lesser fees. However, CEX.io only charges 0.2%, but using the exchange requires a time-consuming verification process.

American Express transaction fees might be as high as 4%. When you buy crypto with Amex, it may result in a higher fee because American Express charges merchants a larger fee than other payment processors. An annual fee can be associated with your card, depending on which Amex card you choose. Amex can also charge you for currency conversion fees, returned payments, and late payments.

Furthermore, before deciding to buy crypto with Amex, potential customers should consider the speed, ease of use, and reputation of the intended exchanges.

Where can you buy crypto with Amex?

All major exchanges accept credit cards as a payment method for crypto. Here are some exchanges to consider:

1. Paxful: Paxful allows users to trade crypto directly with one another. It's an open marketplace where users can quickly buy the crypto of their choice with less hassle. Amex works seamlessly on the platform.

2. CEX.io: This crypto exchange is one of the pioneer exchanges in the market. It dates back to 2013, when it was established in London. It supports virtually all countries around the globe. It's registered with FinCEN in the US. In the UK, it's listed as a Money Service Business. The exchange says it's never lost user funds.

3. eToro: This company was established in 2008 as a social trading platform. It caters to CFDs, stocks, indices, currencies, commodities, and cryptos.

Amex is an accepted broker on the platform.

How to buy crypto with Amex

1. Choose your preferred exchange: The first step is to look for an exchange that allows you to buy crypto with American Express. Though Amex is not as widely accepted as Visa and MasterCard, all the exchanges listed above accept Amex.

Also, confirm the processing fees, trading fees, and withdrawal fees.

2. Registration and KYC: Once you've been able to choose a preferred exchange, you have to set up your account. Hit the sign-up button and provide any personal information required. Regulated platforms will ask for complete KYC, including a photo ID.

3. Deposit funds: Once you're done with registration, select the "deposit funds" option. Enter your deposit amount, then choose "credit card" as your preferred payment method. Enter the Amex card details required to connect your card. Then make a deposit.

4. Buy crypto: When your deposit reflects on the exchange, you can begin purchasing the crypto of your choice.

Bottom Line

The pros of using the Amex credit card to buy crypto cannot be overstated. Users enjoy fast processing of their deposits and industry-standard fraud protection.

Though Amex is plagued by high transaction fees and a limited purchase size, its crypto-friendly stance has made it a more widely accepted method of payment on crypto exchanges.