Whether you have been investing in physical gold for years, or are just starting out, the payment methods accepted by major gold dealers has remained the same for some time now. They have always included checks, bank wires, credit cards and debit cards. These options have been unchanged for decades now – that is, until a new and innovative digital currency, bitcoin was invented and began gaining popularity.
Only recently have cryptocurrencies like bitcoin come to the forefront of the online payment world, in turn expanding your options when buying gold coins and bars. Today, there are over 1,000 cryptocurrencies like bitcoin, but BTC has remained at the top of the list in terms of popularity.
Bitcoin was invented by an anonymous man (or woman) using the name Satoshi Nakamoto sometime around the financial crisis in 2008. The official whitepaper and public announcement of its launch was released roughly a year later in 2009. At first this new digital currency, which is based on blockchain technology, received a lot of skepticism. In the early years, bitcoin quickly skyrocketed in price from being virtually worthless to a value of around $1,200 USD. It has been pretty volatile for most of its life, but in 2017 it hit a jaw-dropping all-time high of over $19,000 USD.
Since 2009 the uses of bitcoin have been added to and innovated upon. Today, you can buy almost anything with bitcoin online including but not limited to gold and silver bullion. Because bitcoin is still a fairly new digital currency, many companies are reluctant to accept it as a form of payment for such a liquid asset like gold bullion. Even though that is the case, many dealers have jumped on board recently and now accept bitcoin as payment for their gold coins and bars.
Problems with Bitcoin and Gold
When it comes to buying gold bullion with bitcoin, there are a few small problems, primarily associated with the company selling it as opposed to the buyer. The first problem lies in the fact that many traditional financial institutions do not deal with bitcoin in any way. Some banks will even close accounts from merchants who are associated with bitcoin and other cryptocurrency transactions.
There are also only a handful of bitcoin merchant solutions available right now from two major companies; BitPay and Coinbase. This makes it hard for a large gold bullion company to accept cryptocurrency with their current bank, and forces them to look elsewhere, often into uncharted waters. Some companies may be afraid to do so, or simply lack the resources.
The next problem arises from the many anti money-laundering policies in place by the U.S. and other governments. Both bitcoin and gold bullion, being very liquid assets, make it easy for those with criminal intentions to launder or move money around. This can be problematic for companies, meaning they have to keep an eye out for anyone who appears to abuse the liquidity of gold with the anonymous nature of bitcoin.
Where to Buy Gold with Bitcoin
Because there are still some obstacles in the way when it comes to bitcoin payment processing and banking for merchants, not many companies accept it. With that said, there are some leading bullion companies who have decided to try it out as a form of payment for the gold and silver that they sell. Below we have put together a list with the top 4 companies who are now accepting bitcoin as a payment option for gold bullion products.
- Bullion Exchanges
- Money Metals Exchange
- Golden Eagle Coin
- JM Bullion
- Provident Metals
How to Buy Gold with Bitcoin
Buying gold and silver bullion with bitcoin is pretty straightforward and easy to learn. To start, you will need to either have bitcoin or buy some. If you don’t already have BTC, it simply adds an extra step to the gold buying process, so it might not be worth it. If you are interested in bitcoin, you can purchase it from services such as Coinbase, which allow users to purchase it using traditional banking methods like debit cards, ACH transfers and bank wires.
Once you have bitcoin, just visit a gold dealer’s website and add the products you want to purchase to your cart, then proceed to checkout. The major difference with using bitcoin to purchase gold coins or bullion comes with completing payment in checkout.
In the case of bitcoin, you just send the bitcoins from your personal wallet to that of the company you are buying from. This information is provided once you place your order and is similar in a way to a credit/debit card, in that payment is virtually instantaneous. Once you send the bitcoins to the companies wallet and they are received, payment is completed and you should be good to go.