Bitcoin has been making headlines lately, and for good reason. It is the most successful cryptocurrency to date, with a market cap of more than $600 billion. With that kind of popularity, it should come as no surprise that Bitcoin is gradually becoming a viable payment option for those looking to buying an eBike.
However, there are some aspects to purchasing bitcoin that can be confusing or difficult if you don’t know where to start.
In this blog post we will walk you through each step of the process including finding a retailer who accepts bitcoin as payment, getting set up on an exchange, sending funds from your wallet to the retailer and finally taking receipt of your eBike.
Deposit Money on a Cryptocurrency Exchange
The first thing to do is get hold of some bitcoin.
There are many ways to buy bitcoin or other cryptocurrency including using special ATMs that work similarly to normal cash machines and P2P (peer to peer) where you buy from an individual on an online platform that acts as an intermediary similar to how airbnb or eBay work.
One of the safest and simplest methods for a complete beginner is to use a cryptocurrency exchange.
A cryptocurrency exchange is an online service where people can trade their currency for another type of currency. In this instance traditional currency (known as fiat) will be exchanged for digital or cryptocurrency. There are two types of exchanges – centralized exchanges like Coinbase and decentralized like IDEX. In this post we’re referring to centralized exchanges as they’re easier to navigate for complete beginners.
There are several hundred cryptocurrency exchanges all competing for your business and they differ in how much they charge for their fees, which cryptocurrencies they offer, the type of fiat money they accept, your geographical location, whether they’re centralized or decentralized, the type of trading platform and available trading tools, etc.
For the purposes of this article we’ll be referring to three of the biggest, centralized cryptocurrency exchanges in the world – Coinbase, Binance and Kraken
All three are reputable companies that have been around for a number of years and are relatively easy to use for newbies
With these companies you need to open an account first, which is fairly straightforward. Just like opening a bank account, you will need to provide ID and proof of address.
Once you’ve been approved you can then make a deposit with a credit card, debit card or bank transfer.
It is generally always more expensive making a deposit with a credit or debit card compared to simply transferring the funds from your bank. Bank transfers can take a few hours to a few days for your crypto account to get credited but will generally be free of fees, whereas a card deposit will take minutes.
Once the funds are in your account you then use all or some of your money to buy bitcoin or any of the other cryptocurrencies available on the exchange.
Once you have completed your purchase the crypto will show up in the relevant crypto wallet on the site.
So any bitcoin you buy will end up in a bitcoin wallet and any litecoin you buy will be in a litecoin wallet etc. Any fiat cash left over from your purchase will be in it’s own specific currency wallet.
All these wallets will be part of your account on the exchange.
Move Bitcoin to Personal Crypto Wallet
The next step is to transfer all or most of your crypto to your own personal digital wallet. The main reason for this is that leaving your crypto on an exchange effectively means giving up control and ownership of that crypto because that exchange holds your private keys – think of private keys as highly complex passwords. The second reason is that if the exchange gets hacked or folds your crypto is at risk.
Holding on to your crypto in your own private wallet means the private keys are in your hands which gives you complete control and security over your cryptocurrency.
There are two main types of wallets – hardware and software.
A hardware wallet is a highly secure physical device not permanently connected to the internet and is generally used to store large amounts of crypto.
A software wallet is stored on a mobile phone or desktop computer. Depending on how much you want to spend on your eBike you’ll probably have your funds on a mobile wallet such as Trust, Exodus, Coinomi to name a few which can be found on Google Play or Apple App Store. Many of these wallets can also be accessed from your desktop computer.
Find Retailer or eBike
While there are increasing number of companies accepting cryptocurrency as payment – ExpressVPN, AT&T and Microsoft to name a few – bike shops have been very slow in adopting this method.
Three stores that deserve a shoutout are The Vault Bicycle Shop, Ride Panda and Ride Fat Daddy.
More general stores that also sell eBikes and accept cryptocurrency are Overstock and Dicks Sporting Goods.
So apart from Google, one other way to find eBikes that can be paid for with crypto is the spendabit website. It’s a growing retail search engine that lists stores that accept cryptocurrency. While not many eBike stores are listed, stores are being added all the time.
Paying for your eBike
So you’ve found your ideal eBike and none of the stores selling it will accept bitcoin, what are your options?
Bitcoin Debit Card
For buying from the majority of retailers who do not accept bitcoin payments, there are two common ways around this:
i) A bitcoin/crypto prepaid debit card. Exchanges and other financial companies are beginning to trip over themselves in offering crypto debit cards with many of them giving added benefits of cashback, discounts on certain goods and services like Netflix and Amazon and favourable interest rates on savings plans.
Just like standard prepaid debit cards, these cards are loaded up with an amount of cryptocurrency (or fiat) from your digital wallet. At the point of sale the crypto is converted to “normal money”.
One of the advantages, especially for long-term holders of cryptocurrency, is that crypto is only converted at the point of sale, saving on fees and holding on to any gains longer. Another advantage is that as many of these cards give cashback in the form of crypto – even if you pay with fiat on the card – it’s an easy introduction to owning cryptocurrency.
The financial costs of owning a prepaid crypto card will vary ranging from zero fees for getting the card in the first place to a one-off nominal fee of between $5 and $20. Some will charge a monthly fee or a charge for every purchase or a dormancy fee for not using it often enough. Others will charge for withdrawing cash beyond a certain amount from an ATM – exactly the same scenarios as with standard prepaid cards.
Using a crypto debit card is the easiest way of buying virtually anything from retailers who do not accept direct cryptocurrency payments.
Three of the most popular cards at the moment with different awards are from Coinbase, Binance and Crypto.com
As ever it’s important to do your research to get the right card for your situation.
ii) The second workaround is to use store gift cards purchased with bitcoin or other crypto. Sites such as bitrefill and egifter have hundreds of gift cards for all kinds of companies and services worldwide including McDonalds, Tesco’s, Starbucks.
Bike companies include Halfords and Decathalon. Generalist stores which sell eBikes include Amazon and Dicks Sporting Goods
For the handful of stores that accept bitcoin you can pay straight from your bitcoin wallet.
The wallet address the store gives you – their public key – will be a mixture of numbers and letters and/or a QR code
If you’re using a mobile wallet, it’s simply a matter of using your camera to scan the QR code within the app or copying and pasting the address into your crypto wallet. Once you press “send” the funds will be debited from your wallet within a few minutes.
As a beginner to using crypto for purchases, it can seem initially intimidating but with a little research and following the above steps
- Deposit Money on a Cryptocurrency Exchange
- Buy Bitcoin
- Move Bitcoin to Personal Crypto Wallet
- Find Retailer or eBike
- Make Payment
you can buy any eBike from virtually any retailer using nothing but bitcoin.