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How to Buy Cryptocurrency on Venmo


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Venmo has revolutionized the way many of us deal with cash. Not only has the app eliminated the need to keep a running tab between friends, but more than 2 million merchants now accept payments via Venmo.

As of April 2021, Venmo is offering a digital solution of another kind to its more than 70 million users. You can now use the app to buy cryptocurrency for as little as $1. And it’s really easy to do.

Are you anxious to squash your crypto FOMO? Here are a few factors to consider before buying cryptocurrency through Venmo versus any other trading platform.

How to Buy Cryptocurrency on Venmo

You can buy, hold, and sell cryptocurrency through your Venmo profile. If you don’t already have one, you’ll need to start by setting up a personal Venmo account and verifying your identity. You may be required to provide your Social Security number or Individual Taxpayer Identification Number (ITIN), address, date of birth, or other personally identifiable information. 


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To make a purchase, you’ll need to link your debit card or bank account, or simply use your Venmo balance. When you’re ready to buy, open the app and follow these steps:

  1. Open the menu 
  2. Tap “Explore” or “Manage” next to Crypto 
  3. Select the cryptocurrency you want 
  4. Enter the dollar amount
  5. Hit “Review”
  6. Review the fee breakdown
  7. Tap the Buy button 

You can track changes in your crypto’s value on the Venmo app, with updates available as frequently as every few seconds. You can also share your crypto purchase on your Venmo feed, although it’s not recommended (see more on this below).


What Kind of Crypto Can You Buy on Venmo?

Some platforms offer as many as 60 or more cryptocurrencies, but with Venmo you choose from four popular types of crypto. You can buy Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH). Bitcoin and Ethereum are the two most popular crypto on the market, and Litecoin and Bitcoin Cash are two of the oldest cryptocurrencies available today.

Fees for Buying Crypto on Venmo

Unlike some other crypto platforms, Venmo’s fee structure is fairly straightforward. Venmo charges between 1.5% and 2.3% of the amount you buy or sell, with lower fees for larger transactions and a minimum charge of $0.50. Here’s a breakdown:

Cryptocurrency Purchase or Sale Amount:Fee
$1.00 to $24.99$0.50 (minimum fee)
$25.00 to $100.002.3%
$100.01 to $200.002.0%
$200.01 to $1,000.001.8%
>$1,000.001.5%

There is no fee for holding cryptocurrency on Venmo, but like other platforms you may be taxed on gains when you sell your crypto.


How Venmo Compares to Other Crypto Platforms

Considering that there are over 10,000 types of crypto to choose from, it’s easy for a first-time buyer to get overwhelmed. Venmo, a digital wallet and social payment service owned by PayPal, creates an easy entry point by stripping down the process. 

Where other platforms offer dozens of choices, Venmo has hand-picked four currencies and made them available at a low buy-in price. But as a trade-off for ease-of-use, you won’t have some of the functionality you get from other crypto trading platforms.

Venmo is ideal for beginner crypto investors who want access to Bitcoin and a few other popular cryptocurrencies. Although you can buy and hold these crypto, don’t expect to take custody of them (move them to another account or to your own digital storage device), because Venmo does not allow you to remove your holdings from the platform. Other cryptocurrency exchanges, such as Coinbase and Gemini, allow users to buy, sell, trade, and earn interest on their crypto, as well as take full custody of your digital assets.

Overall, Venmo is a simple way for beginners to start investing in crypto, but those wanting access to more cryptocurrencies and ways to invest will want to look elsewhere.


Pros and Cons

In short, here’s what you should consider before buying crypto through Venmo:

Pros of Buying Crypto Through Venmo

Buying cryptocurrency through Venmo has several key advantages for its users, making the platform an appealing entry point for newcomers. 

User-friendly

Venmo is designed to be both beginner-friendly and intuitive for novice crypto buyers, so it’s easier to set up the app and complete the crypto purchasing processes than with some other apps. Whereas SoFi offers 21 currencies and Coinbase offers over 60, Venmo users can choose from a selection of four of the most well-known cryptocurrencies available. 

Plus, Venmo has the benefit of familiarity. Millions of consumers already have the Venmo app and are comfortable using it for financial transactions. By contrast, cryptocurrency exchanges like Coinbase and Gemini may not be household names.

Affordable

The low starting price removes a major barrier to entry for new or hesitant crypto investors. A single Bitcoin may have a five-digit price tag, but buying in $1 increments allows new investors to forego the intimidation factor and get started with very low risk.

Minimal Fees

Venmo’s fee structure is simple. You’ll be charged a percentage of what you buy and sell, with no additional fees. Compare that to Gemini’s long list of charges, including a 0.4% custody fee, 3.49% debit card transfer fee, and $125 administrative withdrawal fee, in addition to the standard convenience fee.

Cons of Buying Crypto Through Venmo

Of course, using Venmo also has some limitations to consider, particularly for veterans of cryptocurrency looking for more options and advanced functionality.

Limited Crypto to Purchase

While there are thousands of cryptocurrency available for trading, Venmo only allows users to purchase four different types of crypto. While Bitcoin and Ethereum are available, other popular options like Solana, Cardano, and Avalanche cannot be purchased on Venmo.

No Transfers

Other apps like Coinbase allow you to convert your Bitcoin balance to different types of crypto, and you can transfer your crypto to any digital wallet. Venmo prohibits you from moving your currency off the platform or transferring your balance to other accounts. If you want to move your crypto funds elsewhere, you’ll have to sell it first and repurchase it on another platform.

Limited Functions

Other crypto platforms give users a variety of ways to cash out or access their currency. Some allow you to cash out at kiosks in malls or grocery stores, exchange crypto from person-to-person, load your balance onto a gift card or debit card, or even use your crypto as a payment method with major retailers like Overstock.com. But with Venmo’s platform, crypto has to be sold if you want to use it for cash value.

Less Secure

Venmo may not be the most secure place to store your cryptocurrency. Unlike some other platforms, Venmo doesn’t allow you to move your crypto into your own digital wallet. If Venmo is hacked or your account is compromised, thieves can quickly drain your crypto holdings.. In addition, cryptocurrency accounts are not insured, meaning that lost or stolen cryptocurrency will not be reimbursed. If you do purchase cryptocurrency with Venmo, we recommend you do not post your crypto purchases in your Venmo feed or publicly share any other information about your transactions. 


Final Word

Buying cryptocurrency on Venmo may seem like a novelty, and in some ways it is. But if you want to make any money with cryptocurrency you’ll have to follow the same time-tested rules for good investing. 

Buying crypto through Venmo can be a great way to start learning about a new asset class, but as always, your best bet is to focus on long-term gains and only invest money you can afford to lose.

If you’re looking for a more robust platform, you’ll have no shortage of options. Cash App offers Custom Bitcoin Orders, so you can set your account to automatically buy or sell when Bitcoin hits a set price of your choosing. Robinhood sets a collar on prices, which can help reduce your losses if a market shift creates a difference between the estimated price and the actual price at the time of your purchase.

For those who want to make crypto a part of their portfolio, it could be worth it to tackle the learning curve and use a more advanced trading platform. Setting up an account with Gemini may be a bit complex, but it gives you access to more than 40 types of crypto. You could also take advantage of Gemini Earn, which offers up to 7.4% APY on your crypto balance. Just beware that the currency in your account is not FDIC insured

Cryptocurrency is known for major price swings as well as scams and cybersecurity risks, so it should be just a small part of a diverse investment portfolio. Experts recommend holding somewhere in the range of 1% to 3% of your liquid assets at most in cryptocurrencies. 

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