Chapter 2.2 Buy Bitcoin With Paypal
PayPal is one of the internet’s most popular payment methods. It’s understandable that a lot of people want to learn how to buy bitcoin using PayPal.
Is it easy to buy bitcoin using PayPal? Will your account get banned if you buy bitcoin using PayPal? Today, we’re explaining everything you need to know about buying bitcoin using PayPal.
PayPal Does Not Officially Support Bitcoin Transactions
It’s important to note that PayPal does not officially support bitcoin. The company has never officially supported bitcoin, nor do they have any plans to support bitcoin in the future.
That means that, in most cases, it’s going to be difficult to buy bitcoin using PayPal. It’s not as easy as entering your PayPal credentials and buying bitcoin. Instead, you’ll typically have to jump through several hoops to buy bitcoin using PayPal.
One of the reasons PayPal isn’t a popular payment method is the risk of chargebacks. A buyer could send money to someone via PayPal, wait to receive the bitcoin, then issue a chargeback complaining that they never received their bitcoin. PayPal sides with the buyer, and the seller loses his bitcoin with no compensation.
It’s also important to note that PayPal – which is notorious for banning accounts for dubious reasons – reserves the right to freeze your funds, ban your account, and perform other penalties. If you get caught violating PayPal’s terms of service (which could include using PayPal to buy bitcoin), then you risk penalties.
Got it? Good. Now, let’s take a look at some of the ways you can buy and sell bitcoin using PayPal.
How to Buy Bitcoin Using PayPal and VirWoX
You can buy bitcoin using PayPal – but only if you jump through a few hoops.
The most popular way to buy bitcoin using PayPal is to use Virtual World eXchange, better known as VirWoX. The popular online marketplace lets you buy other digital items using PayPal. Then, you can trade those digital items for bitcoins.
It’s a multi-step process with higher fees along the way – but using this process, you can legitimate buy bitcoin using PayPal.
For this method, you’re using VirWoX and PayPal to purchase digital items called Second Life Lindens (SLLs). Yes, these are the same tokens used in the game Second Life. They’re a virtual world currency. After buying SLLs, you can trade them for bitcoin for approximately the same value.
Again, you’re not directly buying bitcoin using PayPal (which is pretty much impossible). Instead, you’re going through a multi-step process. Here’s how to do it:
- Go to VirWoX.com and sign up for a free account. You’ll need to enter basic personal details and an email address. It’s a straightforward signup process.
- Activate your account by clicking on the link sent to your email address.
- After activation, we recommend changing your password.
- Add money to your VirWoX account from PayPal. On the left-hand side of your dashboard, you’ll see an option to “Deposit”. Click that link, then click the PayPal option. You’ll be able to view the full transaction fee before the deposit goes through. This process works best using USD because VixWoX has a USD/SLL pairing.
- Trade your USD for SLL by clicking on “Exchange” on VirWoX. Look for the USD/SLL pair. Click on that pair and exchange your USD for SLLs.
- Under the same “Exchange” window, you’ll see an option to exchange BTC for SLL. Now, sell your SLLs for bitcoins. This transaction might not take place instantly. Sometimes, VirWoX will implement a manual review process that takes a day or two to complete.
That’s it! You’ve officially deposited USD via PayPal, used that USD to buy SLLs, then sold than SLL for bitcoins. You’ve bought bitcoin via PayPal.
Remember, you’re going to pay fees throughout this process. You’ll pay a fee when you transfer money from PayPal to VirWoX. You’ll pay a fee to VirWoX when you buy SLLs. And you’ll pay a fee to VirWoX again when you sell your SLLs for bitcoin.
Because of all these fees, buying bitcoin via PayPal isn’t efficient or cost-effective. However, it’s certainly an option.
How to Buy Bitcoin Using PayPal and LocalBitcoins
We mentioned LocalBitcoin in Chapter 2.1. It’s a popular marketplace where you can find people willing to buy or sell bitcoin using a number of popular payment methods – including cash, bank transfers, or PayPal.
Yes, you can use PayPal on LocalBitcoins.com. Some sellers accept it. You can typically expect to pay high fees when using PayPal on LocalBitcoins. Sellers know that only a small number of sellers accept PayPal – so they charge a premium for their services. Nevertheless, you can legitimate buy bitcoin using PayPal on LocalBitcoins.com.
Here’s how to do it:
- Go to LocalBitcoins.com and sign up
- Look for traders in your local area (LocalBitcoins works on a regional basis). Find a seller willing to accept PayPal payments in exchange for bitcoin. You can customize your search to only display sellers that accept PayPal.
- After customizing your search, you should see a list of sellers willing to accept PayPal payments in exchange for bitcoin. Find the seller willing to offer you the best exchange rate. Different sellers offer different exchange rates on LocalBitcoins. Also consider things like feedback score, trade limits, and payment windows, all of which should be listed on a seller’s page.
- Once you’re satisfied with a seller’s terms, initiate the trade. Enter your amount in your local currency, then see the amount of bitcoin the seller is willing to offer. Then, click “Send Trade Request” to initiate the transaction.
Other Ways to Buy Bitcoin Using PayPal
Ultimately, you can use PayPal to buy bitcoin at virtually any website that accepts PayPal in exchange for goods you can sell for bitcoin. Other options include:
All of these platforms either sell bitcoin directly via PayPal. Or, they sell items that can be purchased with PayPal and sold for bitcoin.
Follow the steps and processes listed above to buy bitcoin using PayPal!