At the beginning of any journey into the world of bitcoin, one is faced with a daunting amount of information about this new technology and the economy forming around it. The team at Abra is in the unique position of being one of the first points of human contact on this journey, and so we are able to help many of our customers answer their beginner questions about bitcoin.
One question that often comes up is the question about what options are available for buying bitcoin. Abra is one of many options that are out there, so when should someone use Abra instead of the others? To answer this question, it is worth reviewing the options and seeing where Abra fits in.
Where to buy
Exchanges
Bitcoin exchanges are companies that create a live market for buying and selling bitcoin. Customers will deposit bitcoin or fiat currency into their accounts and then place different order types that are recorded on an order book managed by the exchange. Some exchange offer simple limit orders, while others offer advanced order types such as stop loss orders and margin trading.
Having an account with a bitcoin exchange is like having a seat on the NYSE. Bitcoin exchanges are great for day traders and institutional traders who trade bitcoin full time. They often require an advanced knowledge of financial markets to use correctly.
Brokers
Bitcoin brokers are individuals and companies that take buy and sell orders and execute those orders on an exchange on behalf of their customers. The broker will often receive a fee for their service and the customer will receive the bitcoin they placed an order for in exchange.
If having an account at a bitcoin exchange is like having a seat at the NYSE, then doing business with a bitcoin broker is like having an e*Trade or Charles Schwab account. The advantage of using a broker is simplicity. The customer asks for a quote, places an order, and receives what they asked for, and the broker removes the complexity of dealing with an exchange.
OTC markets
Bitcoin OTC markets are “off-the-books” decentralized exchanges that occur through face-to-face meetings and remote trades. In a face-to-face exchange, the buyer and seller will meet at a designated time and place and exchange cash for bitcoin at an agreed-upon rate. In remote exchanges, the trade is coordinated by telephone, email, or another remote communication method. After a price is agreed upon between buyer and seller, the buyer will send an electronic funds transfer to the seller and the seller will send the bitcoin to the buyer’s bitcoin address.
OTC markets are most useful for either buying bitcoin with cash or purchasing large blocks of bitcoin at a guaranteed price. These trades protect against “slippage” that can occur when purchasing large amounts of bitcoin on an exchange.
How to pay
Every bitcoin buying service supports at least one method of payment for purchasing bitcoin, and each payment method comes with advantages and disadvantages. These payment methods are often chosen with these trade-offs in mind so that the experience for both buyer and seller is optimized for the smoothest possible trade.
Cash
Most commonly used by OTC traders, but some exchanges and brokerages also offer cash deposit funding methods.
- Advantages: no chargeback risk; potentially faster and more private transactions
- Disadvantages: depends on local liquidity i.e. cash-in locations where the buyer is located; transaction size can be limited due to security, liquidity, or regulatory issues; fees charged can be higher to offset the operational costs of dealing in cash
Bank wire
Widely used by OTC traders, exchanges, and brokerages.
- Advantages: faster settlement time than ACH for domestic transfers; better for large transactions
- Disadvantages: unfamiliar or poor user experience; can be expensive in some cases; international settlement can take a long time and involve additional foreign exchange costs and counterparty risk
ACH
Widely used by exchanges and brokerages.
- Advantages: fast and cheap; better for smaller transactions
- Disadvantages: unfamiliar user experience; long settlement period; chargeback risk leads to low transaction limits and more stringent KYC requirements
Credit card
Accepted by very few exchanges, always with a large markup.
- Advantages: familiar user experience; ubiquitous adoption by consumers
- Disadvantages: due to the insecurity of credit cards, chargeback risk is a big problem; due to chargeback risk, fees for using credit cards to buy bitcoin are very high
When to use Abra
Abra is a digital wallet that supports holding, sending, and receiving over 50 different currencies including bitcoin. Abra also facilitates buying and selling bitcoin with two payment methods: cash and bank transfers (ACH in the US, BillPay in the Philippines). Due to the limitations of the banking system, bank transfers have daily, weekly, and monthly transaction limits. For transactions that exceed these limits, customers are advised to either see if there is an Abra Teller in their area who can facilitate a larger cash transaction, or else find a suitable bitcoin exchange, brokerage, or OTC market that supports larger purchases using a bank account.
The best time to use Abra to buy bitcoin is when you want to buy an amount of bitcoin with your bank account that falls within our transaction limits, or when you want to buy bitcoin with cash from an Abra Teller in your area. We have Abra Tellers in over 170 cities, with over 1500 Tellers in the Philippines alone at the time of this writing, and this network is growing larger every day. We are also working to increase our bank transaction limits and expand the number of countries where we support bank transfers.
With any task, it’s important to use the best tool for the job so that you have the best outcome possible. Buying bitcoin is no different. We hope this guide helps you make an informed decision about when it is best to use Abra and when it makes sense to find a different solution so you can have the best experience possible when buying bitcoin.
If you don’t have the Abra app, you can download it here.
i have some eth on coinbase. should I transer to ABRA & how
Hi George, the choice to convert your ETH to BTC and transfer it to your Abra app is entirely yours! If you want to, then first you need to convert your ETH into BTC in Coinbase, then send the BTC to the bitcoin address on the “Add money” screen of your Abra wallet. You can find instructions for sending bitcoin from your Coinbase account to an external bitcoin wallet (in this case, your Abra wallet) here: https://support.coinbase.com/customer/en/portal/articles/971437-how-do-i-send-digital-currency-
Wells Fargo holds an account that I can not link to my Abra account. I would like to buy one I can not get past the recovery phrase page. I have a small Wells Fargo Bank account in Denver, Co. that I would like to link to my Abra account. Apparently, I am doing something wrong With the money that I transfer into Abra some USD and then I would like to buy a Bitcoin and keep it at Abra. Can you tell me specifically how I can do this?
Hi Arthur, thanks for your interest! This is a question that our customer support team will be happy to help you with. Please press the “Contact us” button in the main menu of the app to create a support ticket, otherwise you can submit a new support ticket here: https://abra.zendesk.com/hc/en-us/requests/new
I would like to know how much ABRA deposit limit is 1 day
Hi Anh, you can find our current limits on our FAQ page here: https://abra.zendesk.com/hc/en-us/articles/115002918627-What-are-Abra-s-transaction-limits-new-
With Abra enabling people to convert to and from fiat currency and bitcoin as well as with Abra’s underlying technology making use of bitcoin under the hood, will we be expecting any service disruption on August 1st with Abra (noting that there might be a potential disruption with the bitcoin network at that time)?
same question! please answer this inquiry. Im concerned as well
We are monitoring developments but are not committing to any particular strategy until we have more clarity on what the likely outcome of the situation will be. Rest assured that giving our customers the best possible tools to protect their funds is our number one priority.
As Abra transactions take place on the bitcoin blockchain, any service impact to the bitcoin network would likely impact Abra as well.
I was given a code which was sent to my iPhone. Then I entered a Pin. Wells Fargo requires another level of security, so I was sent another code to an old phone number. I haven’t been able to get past this spot because I don’t know the old phone number. How can I resolve this?
Hi Jean, if I understand correctly, you may need to update your phone number with Wells Fargo. If that’s not the case, please have a look at this FAQ:
https://abra.zendesk.com/hc/en-us/articles/115005347068-I-m-unable-to-add-my-US-bank-account
or you may contact our support team at any time: support[at]abra.com
Marvin Gove
Jul 27, 10:22 AM PDT.
My wife and I opened a new joint checking account with Chase bank with on-line banking profiles.
I was able to fund Coinbase from this account, so ACH transfer mechanism works.
I went to Abra and setup the new bank account (Chase). This was verified and accepted by Abra.
Then tried to fund my Abra wallet from the new Chase account and got the response
…”Ooops, an unexpected error has occurred. Please try again.”
I contacted Abra support group, but they don’t seem able or willing to help me. Buying BTC at Abra with an approved bank ( Chase, for instance) is supposedly a working option with Abra.
Any body have any suggestions?
Hi Marvin,
Thank you for following up.
Unfortunately this is a side-effect of how insecure the legacy banking system is. Our banking partner or our security protocols do not give customers any additional information about why a transaction is canceled because they don’t want to make it easier for illegitimate users to game the system. We wish we could provide more information to our customers in these cases so they can understand what went wrong but in these cases it’s not safe to do so.
For what it’s worth, this is standard practice across the financial services industry.
We do have other funding alternatives – tellers, American Express, payments via other users, or bitcoin deposits.
We sincerely do apologize that bank integration does not work for your Abra wallet and the inconveniences you’ve experienced,
Max
I send Btc to my abra app but i did not recive it .
Hey Aaron,
Please send an email to our Support team at support@abra.com explaining your problem, and they should be able to help you out.
Regards,
Max
Can I use Abra to send bitcoin to another wallet outside Abra? If yes, how do I do that?
Hey Bob,
Thanks for reaching out Bob. To send money to an external bitcoin wallet, press ‘Withdraw’ on the home screen, and then press ‘Use Bitcoin’. You will then be prompted to enter the Bitcoin address, or you can scan the external Bitcoin wallet’s QR code. Enter the amount you want to send, and press ‘Next’ in the top right hand corner. Press ‘Confirm Withdrawal’, and that’s it! You’ve sent your Bitcoin to an external wallet.
Regards,
Max
Thank you, Max! Really appreciate it.
I have fiat in my abra account. How can i convert this to bitcoin?
Hey Mike,
Great question. To convert fiat into bitcoin, press the ‘menu’ icon on the top left of your Abra home page. Then, scroll down to ‘Wallet Currency’. Here, you can choose to convert your fiat into any of the supported currencies, including Bitcoin.
Regards,
Max
This is Tom Hu at tom6613@gmail.com
Never mind my previous question. I found it in other section of QA.
Thanks
I do not use a smart phone…..will ABRA work with my computer?
June,
Thanks for reaching out. Unfortunately, Abra is only on smart phones at this time.
Thanks,
Max
How do I buy other crypto currencies w/ BTC that is in my ABRA account?
Where do I find all of the crypto currencies that can be purchased w/ my ABRA account?
Hi Dennis!
While bitcoin is the only crypto-currency that Abra supports, now that you have bitcoin, you can use it with any third-party service that accepts bitcoin as a payment method for buying other crypto-currencies.
One popular one is called Shapeshift.io
We’ve written before about how to fund your Abra wallet with alt currencies by using ShapeShift.
https://www.abra.com/blog/deposit-altcoins-abra-wallet-shapeshift/
It also works the other way around. You will have to use another wallet to store your non-bitcoin crypto currency.
Hi If I am in Saudi Arabia but the account I am using is from the bank account Philippines. Is this possible? Can I use that account to add funds to my Abra account then buy bitcoins or any other crypto currencies?
Hey Ron,
If the bank account is from the Philippines then you should have no trouble using this account. And yes, you can add the money into your Abra wallet and then convert it to Bitcoin. We would advise setting your ‘Wallet Currency’ to Bitcoin first, and then transferring the money into your account, so it will show up as Bitcoin.
Hope this helps,
Max
Hello po. Mag ano po ang fee pag magcoconvert ng php to btc?
Hey Dennis,
Abra does not charge fees when converting between currencies. That being said, Abra may make a small amount in the conversion process.
Thanks,
Max
Trying to start my account and my first funding is with an Amx. Card. I’m and old man and I need help
Hey Carl,
If you’d like some help, please send an email to support@abra.com. They can hop on a call with you and give you all the help you need.
Regards,
Max
I’m trying to get bitcoin into my ABRA and JAXX account. Help!!
Hey Jeff,
If you are running into any troubles using the app, feel free to send our support team a message at support@abra.com. They’d love to help you get set up and start using Abra.
Best Regards,
Max
How do I purchase BTC with American Express? I don’t see any option available for that….
Hi Sally. If you have a US-based Amex card and don’t see the Amex option available to you, you can use the ‘Contact Us’ option within your Abra app to contact our support team for assistance. Thanks!