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📲 The Cheapest Way to Buy Bitcoin on Mobile (2024)

Discover the smartest way to buy Bitcoin on mobile! Understand why Coinbase, Kraken and Binance will always have the lowest fees compared to apps like Strike and Robinhood. #BitcoinBuying #Coinbase #Kraken #Binance #BitcoinETF #CryptoInvestment
📲 The Cheapest Way to Buy Bitcoin on Mobile (2024)

In this new bull market, Bitcoin spot volumes are higher than ever thanks to the ETFs

If you're not sure which ETF is right for you check out my analysis here

Bitcoin ETFs Ranked

Even in this new age of ETFs, lots of people are buying Bitcoin on mobile

Unfortunately, 99% of people buying Bitcoin on mobile are getting ripped off

There are two big categories of Bitcoin mobile apps

Exchanges have the most liquidity and can offer the lowest prices. But they often have a broker layer in their mobile apps.

The first category is exchanges like Coinbase, Binance, and Kraken

The problem with this category is the fees suck

By default, these apps are usually interacting with a broker that charges 1%-10% fees to buy Bitcoin which is way too high

The second category is neo-banks like Strike, Cash App, and Robinhood

Neo-banks like Strike or Cash App interact with exchanges for you. The UX is great but they'll never have lower fees than the actual exchange.https://strike.me/blog/strike-2023-recap-2024-lookahead/

And the problem with the second category is ... the fees also suck

Some of these will tell you things like "we charge zero fees" which is never true

In reality they're charging you a spread that changes over time

Spreads aren't technically fees, but they affect how much Bitcoin you get - so they matter

To get the lowest fees we need to bypass the broker in the first category of exchanges

The only mobile app that does this today is Coinbase Advanced Trade

Advanced Trade fees are 90%+ lower than the Coinbase broker fees

To use Coinbase Advanced Trade all we need to do is open up the regular Coinbase app

Next you'll click on the 9 dots in the top left

Choose the 9 dot square thing

Then click on the toggle to turn on Advanced Trade

Turn on Advanced Trade

Now all we do is pick our market - in this case BTC-USD

Advanced Trade UI

We can choose to buy or sell

We can choose a market order or limit order (I usually do limit order because the fees are lower)

I'll choose Bid because I want it to fill fast

I'll put in the USD amount I want to buy

I'll choose to buy with USDC because I want my USD balance to earn interest while it's sitting in my account

You can choose 1%, 5%, 10% to get better price execution but it could take longer for your buy order to fill. Mid and Bid are the worst price execution but the fastest order fill.

You can change your execution to Post Only to get the best fees

And then Place Buy Order

Execution of Post Only guarantees you get maker fees for your limit order, but the order will fail to post if you create a limit buy that is above the current price. The alternative (Allow taker) will allow some % of your order to be executed with taker fees (basically a market order) so it will fill more often but you'll get higher fees.https://help.coinbase.com/en/coinbase/trading-and-funding/advanced-trade/order-types

To check on the status of your order you can go back to the main page click on Orders and then click on your open Limit Order

Trade -> Orders to view your open and filled orders

You'll see on that in Advanced Trade we only paid 0.6% in fees which is 90% lower than the fees of regular Coinbase

$0.12/$19.80 = 0.6% fees for our limit order

The fee for the same buy order on regular Coinbase is 12.5X higher

Buying $20 of Bitcoin without using Advanced Trade

Some of you might be saying "That's great Rhett but 0.6% is a high fee too, Binance is only 0.1%"

That's true but we also have to consider the withdrawal fees

Coinbase has higher trading fees than Kraken and Binance but the withdrawal fees are much lower https://withdrawalfees.com/coins/bitcoin

In 2024, exchanges need to use variable withdrawal fees or high static withdrawal fees so they don't lose money

If people are making lots of Bitcoin transactions it will cost an exchange more to send you your Bitcoin

When fees spike for them, they pass the cost along to us

In the past they didn't have to do this because the cost to make a transaction was so low that they were eating the cost

Any exchange still offering free on-chain withdrawals in 2024 is losing money.

It's not a sustainable long term strategy.

To get around these fees check out mempool.space to see when you can make a cheap withdrawal

On top of that, some exchanges like Binance charge an extra withdrawal fee on top of the on-chain fee

So while their trading fees are low, it's very expensive to take self custody - which is the whole point of Bitcoin.

When you're using Coinbase Advanced Trade, you'll pay a little more per trade versus Binance.

But you'll make that up on the backend when you withdraw to cold storage

Best cold storage wallet for you

DM me on Twitter or join the Discord if you have any questions if you have any questions

See you guys next week