If you follow this life-hacking blog you probably know that I hate paying high premiums. The market frenzy around cryptocurrencies has led exchanges to charge very high fees and rip off customers. Time to change all that!
Technically, you can follow this guide to buy Ethereum, Bitcoin, Bitcoin Cash and Litecoin without paying any fees whatsoever. What you see is what you get.
Be careful though. I only treat it as a small gamble and I’m prepared to lose everything. This is not investment advice and you should do your own research before buying any cryptocurrencies. They are speculative investments and are very risky! I’ve written my thoughts on crypto here.
Let’s now see how we can buy Ethereum as an example.
The simplest option is to follow what everyone else is doing. Sign up for Coinbase, top up the account using your debit card and hit the Buy button. If you sign up using this link we both get $10 worth of free bitcoins. I won’t blame you since this is the most hassle-free choice but it will cost you 4% in fees. If you’re buying a small amount of crypto maybe that’s ok, but for large amounts, percentage fees hurt!
For those of us who want the more advanced but cheapest option to buy Ethereum and other crypto, read below.
Cheapest way to buy Ethereum in the UK
- Sign up for Coinbase
- (UK only) Transfer funds to Revolut
- Make a bank transfer to Coinbase
- Move the money from Coinbase to Coinbase Pro
- Buy Ethereum using a limit order for a 0.50% fee
Step 1: Sign up for Coinbase
The only reason we need to sign up for Coinbase is to use their Coinbase Pro exchange. This is the interface advanced users use to buy and sell Ethereum, Bitcoin and Litecoin every day. In other words, they trade on Coinbase Pro.
Why Coinbase? They’re one of the biggest well-known exchanges and they’ve been around for many years. It’s also a public company listed in the US stock exchange.
Coinbase Pro and Coinbase are the same company and you can transfer money between those two instantly and for free. After you sign up for Coinbase, they’ll ask you for a proof of ID. The verification took a day for me to complete.
[UK only] Step 2: Transfer funds to Revolut
In the UK, banks may block transfers to crypto exchanges such as Coinbase and Binance.
I use Revolut to transfer funds to Coinbase.
Your bank -> Revolut -> Coinbase.
Revolut is a free mobile app / bank but built for the 20th century. You can open one instantly online which also gives you the option to exchange from GBP -> EUR at market rates. Plus, they will give you a EUR IBAN so you can deposit money to Coinbase as if you’re a EUR account holder if you want.
I initially thought that perhaps you can also use Transferwise to deposit EUR at Coinbase. However, many Reddit users warned me that Transferwise doesn’t allow deposits to crypto exchanges. It’s a shame because Transferwise is awesome. I really like the work they’re doing. That’s what I used for my NY trip earlier in 2017.
Step 3: Make a bank transfer to Coinbase
Time to finally load up Coinbase.
Make a bank transfer from your Revolut (or EUR or USD bank) to the Coinbase account bank. When making the transfer, make sure you type in the reference number you were given.
Otherwise, you’ll have to deal with the Coinbase customer service to find out why your money is not there yet…
If you have a Revolut app, you can make a transfer like this: From the main screen click on the Payments icon -> To Bank account and fill in the recipient bank details. Do not forget to add the reference number.
You can always send a small amount like 10€ first to test the waters and once you’re confident enough send the real amount. The money showed up in my Coinbase account a few hours after the bank transfer.
Step 4: Move the money from Coinbase to Coinbase Pro
We will be using Coinbase PRO to buy Ethereum without fees. Therefore, we need to move the money from Coinbase to Coinbase PRO once the bank transfer completes. As mentioned earlier, Coinbase PRO is the same company as Coinbase and they share accounts. No need to register again.
Step 5: Buy Ethereum using a LIMIT order
Now that you have your money on Coinbase PRO a limit order costs 0.50% in fees. What’s a limit order? You basically place an order that says: “I want to buy X Ethereum when the price drops to Y”. Let’s say I want to buy 0.5 Ethereum.
As you can see, 637.80 is the price people want to buy at and 638.03 is the price people want to sell. To have your order filled as soon as possible, type in the green top price.
That’s it! After a few seconds, your order will be filled and you will be 0.5 Eth richer :)
What if I want to buy other cryptocurrencies (Monero, Dash etc)?
Coinbase PRO only supports a few cryptocurrencies. However, there is an awesome service called Shapeshift.io where you can exchange your coins for other coins.
You only pay the miner fee which is typically less than a cent.
You send your coin from Coinbase PRO to Shapeshift and they transform it to your desired coin, sending it to your wallet address.
However, this assumes you have your own wallet!
If you don’t know what this means or can’t be bothered, just sign up to Binance which is an exchange that has hundreds of cryptocurrencies and very low fees.
If you prefer to buy via an actual exchange like Coinbase PRO, sign up to Binance that lists hundreds of coins. It doesn’t require verification and it’s pretty cheap (0.075% fee per trade).
This is actually one of the cheapest ways to buy Ethereum in the UK.
If you make a few trades per day then Coinbase PRO 0.50% fee might be too expensive for you. Better deposit GBP directly to Binance (sign up using my link and we will get back some free BNB coins when trading).
Thoughts
You can repeat the above limit orders for buying Bitcoin cash, Bitcoin and Litecoin. This is a great way to buy or sell your cryptos.
Of course, it’s not the most convenient thing to go through, but once you’re verified at Coinbase and have some funds in it, then it’s the best way to buy Ethereum.
Only buy using the money you can afford to lose. Cryptocurrencies are very risky and very volatile. This article is not investment advice. Do your own research!
If you’re looking to make some money on the side, check out my Matched Betting series for a risk-free profit. No betting experience required.