How to Buy Gold With Bitcoin
Gold and Bitcoin might have more in common than you think. Both assets are non-traditional, alternative ways to invest. Bitcoin has even been called digital gold by some experts, since the cryptocurrency is both rare and valuable.
Even more importantly, both cryptocurrency and precious metals are important financial instruments for investors who want to diversify their portfolios. Like Bitcoin, gold is an asset that tends to be non-correlated with some of the economic stimuli that influence stock and bond prices.
For a number of similar reasons, there’s a solid overlap between gold stackers and Bitcoin investors. Given the large percentage of gold collectors that also love alternative digital currencies, it only makes sense that so many investors want to know how to buy gold with Bitcoin.
Can You Buy Gold With Bitcoin?
Here’s the good news: it is extremely easy to buy gold with Bitcoin. Multiple online gold dealers accept Bitcoin (and other cryptocurrencies) as payment. That’s right – you can buy gold with Bitcoin by following just a few simple steps.
Before we get into the nuts and bolts of how to buy gold with Bitcoin, let’s take just a moment to address the pros – and cons – of using cryptocurrency to buy precious metals like gold.
Benefits of Buying Gold With Crypto
There are three main benefits to buying gold with crypto: secure transactions, lower fees, and quick transaction fees. There’s a reason Bitcoin and other digital currencies have taken the world by storm. We’ll take a closer look at why so many investors want to know how to buy gold with Bitcoin below.
Secure Transactions
Bitcoin is extremely secure. The two-factor authentication required on many Bitcoin wallets makes it one of the most consistent, safe ways to pay.
Remember: the blockchain is immutable. This means that public transactions published on the Bitcoin ledger cannot be changed or reversed. The public ledger used to store transactions is nearly impossible to alter, making Bitcoin one of the most secure ways to buy anything – including gold.
Lower Fees
Fun fact: gold dealers often charge lower fees for some payment methods than others. Sites that accept Bitcoin for gold tend to discount cryptocurrency payments. Hero Bullion is a good example of this model; we offer a discount when you pay with crypto. By buying gold with Bitcoin, you can save more money than you would spend paying by credit/debit card.
Make sure to check transaction fees before buying gold with Bitcoin from an online dealer. Some dealers discount crypto payments more than their competitors do. For Hero Bullion, the cheapest way to buy gold is using eCheck. The second cheapest payment method, though, goes to cryptocurrencies like Bitcoin.
Buying gold with Bitcoin can also help you save big on transaction fees. Credit card transaction fees are notoriously high, and cryptocurrency fees are extremely low by comparison.
Quick Transaction Speeds
While transaction speeds vary based on the cryptocurrency and blockchain you use, crypto tends to be a much faster payment method than some of the other options you find on gold dealer websites.
EChecks are a good example to illustrate just how fast payments are processed on the blockchain. Depending on which network you use, eChecks typically take anywhere from three to five business days before processing.
Typically, Bitcoin payments take between half an hour to two hours to process. Other cryptocurrencies can be even faster. Bitcoin Lightning transactions are even faster – some purchases on this blockchain can be processed within fifteen minutes.
Downsides to Buying Gold With Bitcoin
There are a couple of notable cons to buying gold with Bitcoin. Before we get into our step by step guide on how to buy gold with Bitcoin, let’s take a look at some of these downsides.
Volatility and Bitcoin’s irreversibility are two major issues that turn some gold stackers away from buying gold with crypto.
Volatility
Bitcoin’s price action is very volatile. In fact, cryptocurrencies in general are considered some of the riskiest investments on the planet for this very reason.
This volatility doesn’t impact the reliability of buying gold with Bitcoin, but it can be troubling for investors who aren’t paying careful attention to the market. When you buy gold with Bitcoin, you lock in your cash price the moment you submit payment.
If Bitcoin’s price increases after the payment processes, you’ll still get your gold. However, you’ll also lose out on potential profit.
We recommend that investors who buy gold with Bitcoin take some time to familiarize themselves with the market. The best time to buy gold with Bitcoin is when the cryptocurrency has increased in value. You don’t want to spend half a Bitcoin on several gold bars and then realize you’ve missed out on thousands of dollars when the value of Bitcoin goes up!
Immutability and Irreversibility
Like we mentioned earlier, Bitcoin’s blockchain is immutable. Additionally, transactions logged to this public ledger generally cannot be reversed. While this is great from a security perspective, it also spells trouble if you make a costly mistake when sending your Bitcoin to an address.
There are countless stories online of people – or even companies – losing millions by sending Bitcoin to the wrong address. This problem is pretty easy to avoid. Using a payment platform like BitPay can make it easier for you to buy gold with Bitcoin without the risk of sending your hard-earned crypto to the wrong wallet.
The good news: even though Bitcoin transactions are irreversible, many dealers still offer refunds if their gold coins and rounds aren’t up to your expectations.
How to Buy Gold With Bitcoin: A Step By Step Guide
Learning how to buy gold with Bitcoin doesn’t have to be complicated. Below, we’ll walk you through the three steps of buying gold with Bitcoin. Make sure to purchase some Bitcoin, find a dealer that accepts cryptocurrency as payment, and then buy your gold!
Purchase Some Bitcoin
The first step to buying gold with Bitcoin should be pretty obvious: get yourself some cryptocurrency!
There are several ways to invest in Bitcoin, so we won’t get into all of them here. Find an exchange you like that offers favorable transaction fees and pick up some Bitcoin.
When you buy Bitcoin, you’ll have to store it in a wallet. Most popular wallets will do; Bitcoin payment processors usually cast a wide net to make sure that nearly any wallet is compatible with their platform.
Once you have Bitcoin safely hidden away in your wallet, it’s time to find a dealer that will accept Bitcoin for gold!
Find a Bullion Dealer That Accepts Bitcoin
With the meteoric rise of Bitcoin’s popularity, it’s unsurprising that so many online gold dealers now accept cryptocurrency for Bitcoin. Gold dealer Hero Bullion now accepts 13 different cryptocurrencies for their gold, silver, and other precious metal products.
We’re not alone, either. You shouldn’t have any trouble finding a dealer who will accept Bitcoin for gold. We always recommend comparing prices across several different gold dealers before making your next purchase.
Does Hero Bullion Accept Bitcoin?
Hero Bullion does accept Bitcoin! Simply select “crypto” when you checkout with one or more of our gold coins or bars in your cart. We also offer a discount on purchases made with cryptocurrency. You’ll pay a bit more than our eCheck price, but you’ll certainly save money compared to our credit/debit price.
We process cryptocurrency payments using BitPay, so you’ll need to make sure you have a BitPay-compatible wallet. Luckily, BitPay has integrated dozens of Bitcoin wallets into their platform.
Buy Your Gold With Bitcoin
The final step in the process of how to buy gold with Bitcoin is probably the easiest. Once you’ve purchased some Bitcoin and found a dealer who accepts the cryptocurrency as payment, all you need to do is checkout with your favorite gold bar or coin!
Some gold dealers may have complicated procedures in place for customers buying gold with Bitcoin. Most of the dealers we’ve found online opt to use BitPay, which is a simple and convenient platform for accepting cryptocurrency payments.
On most websites, all you’ll need to do is click “pay with crypto” and then follow the on-screen prompts to finalize your transaction.
How do Crypto Payment Platforms Work?
Gold dealers often use one of several cryptocurrency payment platforms to allow their customers to buy gold with Bitcoin. Hero Bullion uses BitPay, which is likely the most common option for online retailers who accept Bitcoin as payment.
When you use BitPay for the first time, you’ll need to have a working cryptocurrency wallet loaded with enough crypto to make your purchase. With dozens of supported wallets, this shouldn’t be too difficult.
Once you’ve linked your wallet, you’ll have a set time limit to transfer the funds to your dealer’s wallet. Because of the quick transaction speed possible on many cryptocurrency blockchains, you should be able to finalize your payment quicker than most other payment methods.
Is It Cheap to Buy Gold With Bitcoin?
Buying gold with Bitcoin can be cheaper than paying for precious metals using a credit card or eCheck. Of course, the cost of a transaction can vary based on several factors.
First, remember that dealers usually discount cryptocurrency purchases. It’s quite a bit cheaper to buy gold with Bitcoin than with a credit or debit card, but you may pay more when using Bitcoin than you would with a slower – but more secure – eCheck.
Bitcoin’s transaction fees are notably higher than fees charged on other blockchains. If you’re diversified in your cryptocurrency holdings, it might be worth taking a look to see if you can save a bit more money by opting for another currency when buying gold.
How Precious Metal Discounts Are Calculated
Usually, eCheck is the cheapest way to buy gold. Also referred to as “cash price,” eCheck fees are discounted significantly because of how secure an eCheck payment method is. In other words, dealers encourage people to use eChecks because the risk of fraud is lower than with credit or debit cards.
Still, most dealers also offer a discount for customers paying with Bitcoin. Bitcoin is a safer payment method than credit cards, so it makes sense that dealers would incentivize people to buy gold with Bitcoin.
Tax Implications – Buying Gold With Bitcoin
Buying gold with Bitcoin can be complicated when it comes to end-of-year tax calculations. We recommend doing some additional research into how taxes are calculated when you purchase an investment using cryptocurrency.
As a general rule, investors are still on the hook for capital gains if they profit from value appreciation in their cryptocurrencies. These gains don’t disappear if you use them to purchase another item like gold.
We’re not tax professionals, though, so we highly recommend that users consult an expert before drawing any conclusions about how buying gold with Bitcoin might influence their total income or tax obligation at the end of the year.
Are There Hidden Tax Fees When Buying With Bitcoin?
Generally, you’ll pay taxes on any capital gains you earn after selling an investment. If the price of Bitcoin increases and you make a profit, this is taxable income.
The same is true for gold, silver, and other precious metals. When gold becomes more valuable, you’ll pay taxes on the amount of profit you made when you choose to sell. Cryptocurrency tax regulations can be complicated, and they may get even more confusing when you add a new asset (gold) into the mix.
If you have questions about how gold investments purchased with Bitcoin are taxed, you might need to do some additional research.
Final Thoughts: How to Buy Gold With Bitcoin
As cryptocurrency continues to become the go-to asset for many young investors, stackers want to know how to buy gold with Bitcoin.
We’re excited to offer crypto as a payment method of all of our precious metal coins, bars, and rounds. By following just a few easy steps, you can buy all sorts of gold products using Bitcoin.
You might also be interested in:
About The Author
Michael Roets
Michael Roets is a writer and journalist for Hero Bullion. His work explores precious metals news, guides, and commentary.