Buy Bitcoin with Euros, Pay (Almost) No Fees

Introduction

The world of cryptocurrencies is highly interesting and this is especially true for the king of all cryptocurrencies: Bitcoin – the one coin to rule them all!

But how can you buy Bitcoin and almost as important: how can you buy Bitcoin without paying the world in fees? Let me explain in this blog.

I have a few requirements I want to be met when buying Bitcoin:

  • I want to pay in Euros;
  • I want to be able to pay by bank transfer or iDEAL;
  • I want a real world good exchange rate for BTC/EUR;
  • I want the whole procedure to be fast (enough);
  • I want to pay as less fees as possible.

Let’s start!

Coinbase Pro

I will be using Coinbase Pro. Coinbase Pro is an online cryptocurrency Exchange where you will be able to deposit fiat money (EUR, GBP and USD – which option is available to you is dependent on your country of residence) and then trade this currency against Bitcoin (but there are several other fiat markets available).

The figure below shows the EUR pairs that can be traded.

Figure 1: Coinbase Pro EUR markets.

First of all sign up at https://pro.coinbase.com if you don’t already have an account at Coinbase Pro. Signing up is free and is not very time consuming. If you already have a Coinbase account you can use this account to also log on to Coinbase Pro but additionally you will have to provide verification.


NOTE
Make sure that while you are singing up you secure your account with two-factor authentication (2FA). This will make sure that when you provide your credentials Coinbase Pro will SMS a numerical code to the phone number you provided when you created the account. You will have to provide this code to Coinbase Pro before log on will be performed. This is a highly effective security control.


You will need to provide know-your-customer (KYC) verification in the form a JPG-scan of your passport or driver’s license. The interface to do so is quite friendly and the verification process is quite fast. Usually the whole process will take just a few hours after submitting the scan. You will get notified on the mail address you provided with your account.

Depositing EUR

Now that you have an account it is time to deposit EUR on Coinbase Pro. Select Deposit in the upper right part of the Coinbase Pro web page.

Figure 2: Coinbase Pro deposit option.

A list box appears: choose Euro as Currency Type.

Now an overview is provided with the information needed to transfer EUR from your bank account to your account in Coinbase Pro. The information that is needed to transfer from my bank (ING in The Netherlands) is numbered and marked in yellow in Figure 3.

Figure 4: Coinbase Pro Euro deposit information.

NOTE
As you can see in Figure 3 the transfer fee for SEPA transfers is €0.15. But my bank ING states that payments made in euro to European accounts at SEPA compliant banks are fee free. ING notes that the recipient bank could levy a fee which is deducted from the transfer amount. However, when I transfer € 50.00 then exactly €50.00 arrives at Coinbase Pro so no fee is subtracted from the amount of money I transfer.


With the information in Figure 3 we can create a deposit. Log on to your bank account and choose to do a regular money transfer. Fill in the information as shown below.

Figure 4: ING bank deposit to Coinbase Pro.

NOTE
Only provide the Coinbase Pro Reference Number in the description text field and no other text. I did not enclose my Coinbase Pro Reference Number in quotes. My transfer got through quickly so I assume this is the correct format.


Check everything one more time (make sure you provided the Reference Number!) Now submit the bank money transfer. It is my experience that a transaction takes about three hours to complete. You will be notified on the email address you provided when creating your account when your deposit has arrived at Coinbase Pro.

Exchanging Euros for Bitcoin

Your EUR has arrived at Coinbase Pro and it is now time to obtain your Bitcoin by trading Euros for Bitcoin on the exchange.

Figure 5: Coinbase Pro buy option.

See Figure 5 for an overview of the steps we are going to take to buy Bitcoin for Euros and at the same time pay as less fees as possible.

These are the steps explained in detail:

  1. First of all select the correct market: BTC-EUR.
  2. Choose Buy to place a buy order.
  3. Choose Limit to place a limit buy order.
    This type of order will only be carried out if the price reaches the level set by you.
  4. Provide the price you want to pay for one Bitcoin.
    To have a good chance your order will be fulfilled you can choose the Mid Market Price by clicking on it. If you want to provide another price, type it in or click the chart to automatically fill in the price selected.
  5. If you want to spend all your Euros click Max, otherwise manually provide the amount of Bitcoin you want to buy.
  6. Now click Place Buy Order to submit the limit order.
    Note: as long as the order is not fulfilled you can cancel the order by clicking Cancel Open Order (see Figure 6 – click to enlarge).
Figure 6: Coinbase Pro Bitcoin open buy order.

Now you will have to wait for the order to execute. You can see your balance in your Coinbase Pro wallet after execution.

recap and conclusion

So there you have it. Bitcoin was bought relatively easy and fast for a good Exchange rate and low fees.

The deposit process took about 3 hours to complete during working hours. If you transfer money in the evening (in The Netherlands – GMT +1) to Coinbase Pro it will take until the next day before the sum arrives. You will get noticed via email by Coinbase Pro when the money is received in your account.

The amount of time it takes to exchange Euros to Bitcoin is dependent on your willingness to accept a market rate for Bitcoin. If you want a price that is lower than the current market rate you will have to wait for this to happen (if it happens at all within a reasonable time frame).

Worst case I will pay €0.15 + €0.07 = €0.22 for this transaction from EUR to BTC. This is 100 * (€0.22 / €50.01) = 0.44% of the total EUR transaction amount. In return I got a real world exchange rate transaction.


NOTE
Figure 5 shows that a fee of €0.07 will being charged for this order while Figure 6 suggests that no fee is being charged. This is somewhat confusing but according to Coinbase Pro a maker fee – when you place an order which is not immediately matched by an existing order, provide liquidity to the Exchange – is 0.15%. So €0.07 will be paid for this transaction (= 0.15% * €50.01 in the case of my example order). After the order was executed it was confirmed that this was actually the case.


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