Buying bitcoin in South Africa can be a challenge if you’re not familiar with the process and jargon around cryptocurrencies, particularly if it’s your first time doing it. Before considering to buy bitcoin, it is important that you understand the basic terms and the mechanism of digital assets. That’s why we’re here to help you learn how to buy Bitcoin in South Africa.
In the guide, we will show you everything you need to know about buying bitcoin in South Africa. We will explore the fundamentals of bitcoin, explore the best Bitcoin brokers and provide a a step-by-step guide to show you how to make your first bitcoin purchase.
How to Buy Bitcoin in South Africa in 3 steps?
If you are in South Africa, there are several ways to buy bitcoin such as digital asset exchanges, and ATMs. But the quickest, easiest and safest way to buy Bitcoin is through our recommended broker, eToro. Simply follow the steps below to get started.
Step 1: Open an Account
Open an account with a Bitcoin broker or exchange, such as eToro.
Step 2: Deposit Funds
Fund your brokerage account using a credit or debit card, bank transfer, or e-wallet.
Step 3: Buy Bitcoin
Decide how much money you want to invest, set up the trade, and buy Bitcoin.
Cryptoassets are highly volatile unregulated investment products. No EU investor protection.
Step 1: Sign Up to a Bitcoin Broker
Before you can buy Bitcoin in South Africa, you need to find the right trading platform that suits your need. As such, below we have listed our picks for the best South African bitcoin brokers in 2020.
1. eToro – Best Social Trading Platform for Buying Bitcoin
If you’re searching for the best place to buy Bitcoin in South Africa, look no further. Founded in 2006, eToro offers a multi-asset social web-based investment platform with more than 4.5 million registered users on its platform that can interact with each other and share trading ideas.
This broker offers a range of innovative social and copy trading tools, such as the famous CopyTrader. This allows you to copy the entire portfolios of any investor on the eToro platform, meaning you can essentially trade without doing any of the work!
One of the unique things about eToro is that it offers users the chance to buy Bitcoin and store it in eToro’s own crypto wallet, as well as trade Bitcoin CFDs, meaning you can speculate on its price without actually owning any assets. This broker even offers its own cryptocurrency exchange, eToroX, which you can access through your regular eToro account.
Moreover, investors can trade the CryptoPortfolio, which is a basket of top crypto coins with the weight of each component is decided according to the size of the coin’s market cap. For those who prefer to trade bitcoin CFD, a leverage ratio of 2:1 is available. You can buy Bitcoin with 0% commission on eToro in South Africa.
In terms of regulation and the safety of funds, eToro is regulated by top tier regulators that include the FCA, CySEC, and ASIC, making it a very secure and trustworthy platform.
- Social and copy trading tools
- 0% commission
- Buy Bitcoin or trade CFDs
- Cryptocurrency wallet
- eToro does not offer a desktop-based trading platform
2. Plus500 – Bitcoin CFD Broker with High Leverage
While Plus500 doesn’t allow you to buy actual Bitcoin like eToro does, it does offer Bitcoin CFDs. This market leading CFD broker is particularly notable for the high leverage it offers to South African cryptocurrency tradings, which is up to 1:30. This means an investment of 1,500 rand can be worht 45,000 rand worth of capital.
In addition to Bitcoin, Plus500 offers a selection of 14 crypto coins assets, including the Crypto 10 Index that measures the performance of the top 10 cryptocurrencies in the market. There’s no commission to pay and its CFD spreads are some of the tighest on the market.
The Plus500 platform was specially designed for easy-to-use market execution and navigation. The broker maintains a minimum deposit requirement of $100 (around 2152 rand) to start trading cryptocurrencies, which is lower than many other brokers.
Plus500 is fully authorized to operate in South Africa. The broker is registered in South Africa under Plus500AU Pty Ltd and is authorized by the Financial Services Provider (FSP). Moreover, Plus500 is regulated by ASIC in Australia and Asia, by the FCA in the United Kingdom, and CySEC in Europe.
Plus500 is also a public company listed on the London Stock Exchange under the ticker symbol ‘PLUS’, so it’s very safe and secure.
- Up to 30:1 leverage
- Useful risk management tools
- Low minimum deposit requirement of $100 (2152 rand)
- Overnight fees for cryptocurrency trading
3. AvaTrade – Best Bitcoin Trading Platform for Professional Traders
AvaTrade is one of the leading bitcoin CFD brokers in the market for investors who want to get access to advanced trading platforms and the option to utilize automated trading. While the selection of digital assets at AvaTrade is not the largest, the broker offers great trading terms for bitcoin.
This includes a generous leverage ratio of 25:1 for non-EU residents. Avatrade charges a spread of around 0.35%, which is below the industry average, so it’s an affordable platform on which to buy and sell Bitcoin CFDs.
AvaTrade is also heavily regulated with six regulatory authorities. This includes an authorization to operate in South Africa as the brokerage is regulated by the South African Financial Sector Conduct Authority.
Another thing that’s great about AvaTrade is that it supports a range of trading platforms, including both MetaTrader 4 and MetaTrader 5. These provide access to loads of advanced trading tools, in addition to trading robots and other useful features.
- Low BTC/USD spread
- Advanced trading platforms, including MetaTrader4
- Up to 1:25 leverage
- Limited selection of crypto coins
4. IG – Buying Bitcoin Platform with Lows Fees
IG Markets is an online CFD broker that has been offering trading services since 1974, so it’s one of the best established brokers in the space. . This broker offers an ideal platform for investors that are looking for variety of trading platforms and trading tools.
The selection of trading platforms at IG includes MetaTrader4, ProRealTime, L2Dealer, and IG’s proprietary web-based trading platform. This means you can choose your platform dependent on your experience level and trading requirements. For beginner’s IG’s own platform is one of the best around.
When it comes to bitcoin trading, IG takes pride in offering the lowest spreads and trading fees in the industry. Further, IG allows investors to buy bitcoin with a margin requirement of 5% or a leverage ratio of 20:1. The downside of IG is that their selection of crypto coins is limited and the broker does bitcoin versus other fiat currencies besides the US dollar.
Not only does the broker allow you to buy bitcoin with competitive spreads, but it also has a wide range of more than 17,000 other financia markets to trade on. And as expected with a well-reputed broker like IG, the brokerage holds licenses from top-tier regulators such as the FCA, ASIC, CFTC, NFA, and MAS.
- Competitive bitcoin spreads
- A variety of trading platforms
- Guarantees stop orders
- £250 (5378 rand) minimum deposit
Step 2: Learn How the Bitcoin Market Works in South Africa
What is Bitcoin and How can you Buy it?
Bitcoin is a digital asset released in 2009 as an open-source code by a developer known as Satoshi Nakamoto. Since then, bitcoin has become a phenomenon of the last few of years, reaching its all-time high of $19,891.00 at the peak of the so-called ‘bitcoin bubble’. In simple terms, bitcoin is a digital payment method but also a new form of money and an alternative to the current monetary system.
You can buy bitcoin in South Africa through a Bitcoin exchange or an online broker such as eToro. For example, some forex brokers also offer users the chance to buy and trade Bitcoin. If you choose to buy bitcoin, you also need to obtain a digital wallet that you use to store your bitcoins and manage your bitcoin transactions, though many platforms offer their own proprietary wallets.
You can also trade Bitcoin CFDs (contracts for difference) on many brokers. This allows you to speculate on the price of Bitcoin without actually owning the currency. With CFD Bitcoin trading, you can go short and speculate on the price going down, and you can also use leverage to make larger trades.
Why Buy Bitcoin?
There are many reasons to buy Bitcoin, but the primary reason is that bitcoin can actually replace a significant amount of traditional fiat money. Some people predict bitcoin price will reach 100,000 USD in the next few years, which in a way makes sense if bitcoin will replace a partial amount of capital in the world. However, this is speculation and the future price of Bitcoin is largely unknown. Additionally, even though bitcoin is a volatile asset, it has been declared as a ‘safe-haven’ asset and anti-inflationary currency.
Bitcoin is one of the great economic experiments in history. The high liquidity of bitcoin makes it a great investment if you are looking for short term trading transactions, but the concept of bitcoin and its status as the world’s leading cryptocurency also makes it a great long-term investment with huge growth potential.
How Much Does Bitcoin Cost to Buy?
At the time of writing, the price of bitcoin versus the US dollar is 9,128.93 for one virtual coin. However, each bitcoin can be broken down into 1,000,000 individual units, also known as bits or satoshis. That means you do not have to buy one coin but also fractional shares of bitcoin for any amount you wish. For example, you can buy part of a Bitcoin for $100, $200, or $1,000.
What Can You Buy with Bitcoin in South Africa?
Since Bitcoin is not yet commonly accepted, there are only a few retail stores in South Africa that accept bitcoin as a form of payment. Recently, some of South Africa’s biggest retailers have begun accepting cryptocurrency payments in the form of bitcoin. These include takealot.com, Runawaysale, Raru, Cape Coffee Beans, Custome Candies, and many more.
But apart from using bitcoin in South Africa, there are plenty of global companies and platforms that accept bitcoin as a payment method. These include Microsoft, PayPal, Expedia, and Overstock.
What Regulations are in Place for Buying Bitcoin in South Africa?
Unlike other countries that struggle to define the legal terms of bitcoin in their jurisdiction, South Africa seeks to regulate cryptocurrencies. Earlier this year, top financial regulators, including the SARB (South African Reserve Bank) has released 30 recommendations to form a regulatory framework for digital assets. Currently, buying and selling bitcoin in South Africa is legal but not yet regulated. You should also keep in mind that Bitcoin is taxable in South Africa as of 2020.
While there is not currently regulation in place in South Africa, you can still access secure and regulated overseas brokers and exchanges. Platforms licensed by the likes of the FCA (UK), ASIC (Australia), and CySEC (Cyrpus) are regarded as the most secure.
What Risks are Involved with Buying Bitcoin in South Africa?
In the short term, bitcoin price fluctuations are completely unpredictable, and therefore, investing in bitcoin comes with the risk of losing your capital. Also, unlike other products that most likely could not be worth ‘zero’, Bitcoin can in theory be worthless. On the other hand, Bitcoin is a revolutionary technology and its price limit is unknown.
Bitcoin is a financial instrument that is trading like any tradable asset and if you use the right risk management tools, you can to limit the risk involved with buying bitcoin. As such, it’s advisable that you use a low-medium leverage ratio and always apply risk-reward ratio.
Step 3: Learn How to Buy Bitcoin in South Africa
- How to Buy Bitcoin with PayPal
PayPal is a popular method for buying bitcoin that is very secure and provides fast transactions. You can use PayPal as a payment method to buy bitcoin from brokerage trading platforms such as eToro and Plus500 or a P2P bitcoin marketplace such as Coinbase and Paxful.
- How to Buy Bitcoin with a Credit Card
That’s the easiest option of all. Buying Bitcoin with your credit card is quite simple as the majority of exchanges and brokers accept credit cards. But you will have to find out the restrictions of your credit card provider and fees charged by the exchange.
The main advantage of buying bitcoin with a credit card is that the transaction is instant. The downside is that credit card companies charge a fee of around 3% as they treat cryptocurrency as cash advances.
- How to Buy Bitcoin with a Debit Card
Unlike credit cards, a debit card uses funds directly from your bank account with money owned by you. This means that some banks will limit you from transacting with unreliable exchanges. But Buying bitcoin with a debit card is doable, you can buy bitcoin several crypto exchanges such as Coinbase, eToroX, CEX.IO, and Coinmama. Additionally, you can buy bitcoin from brokers that accept debit cards as a funding method.
- How to Buy Bitcoin without ID
If you’re looking to buy bitcoin anonymously, the best way is to find a platform that doesn’t require you to verify your identity. Some of these platforms include Localcryptos, local.Bitcoin.com, Coinmama, and Wall of Coins.
Other ways to buy bitcoin anonymously include bitcoin ATMs and buying bitcoin directly from another person.
Step 4: Open a Bitcoin Trade
If you’re ready to learn how to buy Bitcoin in South Africa, you can make your purchase through eToro. As mentioned previously, eToro is a regulated bitcoin broker that accepts clients from South Africa and offers innovative social trading tools. Below we have listed the required steps that you will need to take to purchase bitcoin with eToro.
Create an Account and Verify your Identity
First, you will need to create a trading account. This requires you to fill in your personal details and submit documentation that verifies your identity.
Next, you will have to deposit funds into your account. Once your account has been approved, click on the ‘Deposit Funds’ button and choose your preferred payment method. You can choose from a range of options, including PayPal, Neteller and Skrill.
Once the funds have reached your eToro account, you can buy bitcoin. Simply type in BTC/Bitcoin in the search bar at the top of the trading dashboard, and click on the Trade button. Take note that you will be able to get plenty of information on the bitcoin page, including Twitter feed, stats, chart and research (market sentiment, traders’ recommendations, etc).
In the order box, you can set the amount of the trade, the leverage ratio, and the stop-loss order. To complete your bitcoin purchase, click on the ‘Open Trade’ button.
Pros and Cons of Buying Bitcoin
- Due to high liquidity, Bitcoin can be defined as a stable market
- South Africa authorities seek to regulate cryptocurrencies
- Bitcoin can be used as a long and short term investment
- Bitcoin is traded 24/7
- Bitcoin is an innovative technology and a new form of money
- You can buy fractional portions of bitcoin
- Bitcoins are not widely accepted
- Exchanges fees can be high
- There’s a high risk involved with bitcoin trading
If you believe in the long-term future of bitcoin and you want to gain exposure to the phenomenon of this new form of payment, buying Bitcoin is simply when using the right platform. However, before you buy Bitcoin, you need to have a sound understanding of how the market works and you also need to find the right Bitcoin broker.
If you’re looking for the very best Bitcoin broker in South Africa, we recommend eToro. With 0% commission, the ability to buy Bitcoin or trade CFDs, and a selection of innovative copy trading tools, eToro is an excellent choice. Simply click the link below to register an account today!
eToro: Buy Bitcoin with 0% Commission
- Buy Bitcoin with no commission
- Buy Bitcoin or trade CFDs
- Social and copy trading tools
- Accepts PayPal
- Strictly regulated
How do you get a Bitcoin wallet?
Some platforms, such as eToro, provide a digital wallet where you can store, buy, and receive bitcoins. These are usually available as smartphone apps.
How quickly can you sell Bitcoin?
If you decide to buy bitcoin through an exchange, the process of selling your bitcoin may take up to five days. However, if you decide to buy bitcoin via CFD broker, the selling bitcoin execution is instant.
Can I make money with Bitcoin
Yes, but like any other financial asset, you can make money and you can also lose money. Bitcoin is unpredictable and volatile, however, its high liquidity means that the bitcoin market is stable and trading opportunities are always there.
Is it safe to buy Bitcoin?
Absolutely, if you buy bitcoin through crypto exchanges and store them on a digital wallet, then your bitcoins are safe and secure. Otherwise, if you decide to buy bitcoin on a regulated CFD platform, you are completely safe as the broker is regulated and must follow the regulators' requirements.