• Mon. Sep 25th, 2023

How to Buy Crypto Using Cash App – A Complete Beginner’s Guide

Louise Villalobos

ByLouise Villalobos

Aug 25, 2023

Traditionally, crypto users have been buying cryptocurrencies only via trading platforms. However, several Financial Technology (FinTech) apps are now venturing into the crypto world, allowing users to buy Bitcoin and other digital currencies. Cash App joins the likes of Revolut and Google Pay in supporting crypto trading. This guide explains how to purchase crypto using Cash App.

Cash App Explained

Tech guru Bob Lee founded Cash App in 2013, facilitating secure electronic money transfers. By linking your bank account or debit card with the app, you can seamlessly pay for online purchases.

Business of Apps’ recent report showed that fees collected from BTC transactions ($7.1 billion) made up over 30% of the Cash App revenue in 2022.

How to Purchase Crypto Using Cash App

Of course, you need a Cash App account to start using the FinTech app. To register one, download Cash App from the App Store or Play Store. Once it installs, click “Log In” and then “Create Account.” Enter the required information, including your full name, email, phone number, and residential address. After the account is verified, add a payment method. It could be a bank account or a debit/credit card.

You are now ready to purchase crypto. To do this, go to the Bitcoin section and hit “Buy.” Next, select an order type. They are three, including:

  • One-Time Order: Choose this one if you want to buy BTC only once.
  • Auto Invest: This order type is ideal in case you wish to make recurring Bitcoin purchases. It could be daily, bi-weekly, or weekly.
  • Custom Purchase Order: Do you want to buy Bitcoin only when it reaches a certain price? Then, pick this order type.

Next, Enter the amount of fiat currency you are willing to spend on Bitcoin, then input your password and click “Next.” A preview of the transaction will appear, showing important details like funding sources, fees, and the amount of BTC to be deposited in your account. Press “Confirm” to approve the transaction. Expect your crypto to arrive within a few seconds.

Factors to Consider When Buying Crypto Using Cash App

Before rushing to buy BTC on Cash App, there are a few factors that you need to keep in mind. They include:

Trading Fees and Spending Limits

Cash App is a business-oriented company. Therefore, it needs to generate revenue to keep its operations running. And as mentioned earlier, trading fees account for over 30% of the firm’s revenue. That said, expect to incur costs on every crypto purchase you make on Cash App.

Bitcoin purchases worth $500 or less are charged a 3% fee, while those above $500 attract charges of between 0.5% and 2%. Note that the higher you spend on BTC, the lower the fees.

Does Cash App charge users fees to register or deposit money to their accounts? No! However, the regulatory and membership fees that the FinTech app is obligated to pay the Financial Industry Regulatory Authority (FINRA) are passed on to users.

Regarding spending limits, almost all FinTech platforms have put a cap on the amount users must spend on crypto monthly. With Cash App, unverified users can only spend $1,000 monthly, while verified users can spend up to $10,000.

Security Measures

The Bitcoin you purchase on Cash App is usually maintained in a hardware wallet. But why? Well, hardware wallets are safer than hot wallets because they are not vulnerable to online attacks.

Furthermore, Cash App encrypts users’ payment information, making it inaccessible to bad actors.

Crypto market Volatility

Among the inherent risks of cryptocurrencies is high volatility. The wild price swings witnessed in the crypto market can put you at losses within minutes. Therefore, understand this aspect before buying Bitcoin on Cash App.

Conclusion

With multiple Fintech companies stepping into crypto, it is clear that mainstream adoption of digital assets is nearing. While Cash App provides a convenient way to purchase BTC, the spending limit makes it unsuitable for people who want to spend big on crypto.

Louise Villalobos

Louise Villalobos

Louise Villalobos is an adept writer, renowned for her compelling articles that illuminate and engage. Her prowess in breaking down intricate subjects provides readers with clarity and nuance. With a vast and varied portfolio, Louise has solidified her standing as a distinguished voice in contemporary journalism.