Whether you think cryptocurrency is just a fad or the future of finance, it’s a fascinating technology. You probably made your last car purchase with boring old dollars, but maybe your next one will be with a digital currency.
If you are wondering if you can buy a car with cryptocurrency, you are in the right place. Let’s take a look at how it works and whether it’s a good idea. As with all money matters, it is best to consult your financial advisor before making any investments.
What is cryptocurrency?
Cryptocurrency is a decentralized digital resource. Created in the wake of the 2008 financial crisis, Bitcoin BTCUSD,
is the original cryptocurrency. It remains the largest by market capitalization and has inspired thousands of “altcoins.” Popular options are Ethereum ETHUSD,
Ripple, Solana SOLUSD,
and more. The purpose of some cryptocurrencies is to be a store of value like “digital gold.” Others are intended to be a medium of exchange such as cash for the purchase and sale of goods and services.
Another type of cryptocurrency is stablecoins. Stablecoins like USD Coin USDCUSD,
and Tether USDTUSD,
are linked to government-issued currencies such as the US dollar and the euro. For example, one USDC is worth $1. Stablecoins act as digital placeholders for real global currencies.
America’s largest cryptocurrency exchange is a website called Coinbase COIN,
You can buy, sell and manage hundreds of different cryptocurrencies on Coinbase. Merchants can use it as a payment processor for crypto, similar to PayPal PYPL,
See also: Lost Money From $4.5 Million Crypto Wallet Exploitation? Here’s what you should do
How to buy a car with cryptocurrency
There are a few ways you can buy a car with cryptocurrency. Some online car marketplaces such as Car for Coin and BitCars allow you to exchange crypto – primarily Bitcoin – for a vehicle.
It’s an easy way to use cryptocurrency as payment anywhere that accepts debit cards. Crypto debit cards such as BitPay Mastercard MA,
and Coinbase Visa V,
cards work just like regular debit cards, but they draw money from your crypto wallet instead of a bank account.
Some of BitPay’s trusted partners include RM Sotheby’s, Vegas Auto Gallery and Mecum Auctions, but you can use a BitPay card anywhere Mastercard is accepted. You can use a crypto debit card for down payments, monthly payments and insurance payments, but you may have trouble finding a dealer that will let you buy a car directly with a debit card.
BitPay supports many major cryptocurrencies such as Bitcoin, Ethereum and Litecoin, stablecoins such as USD Coin and Binance USD, and even some memecoins such as Dogecoin DOGEUSD,
and Shiba Inu SHIBUSD,
A couple of other options in crypto debit cards include the CryptoWallet Mastercard and the Crypto.com Visa card.
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A list of merchants where you can buy with crypto
Some car dealerships across the country accept cryptocurrency as payment, but there are no manufacturers that accept crypto across their entire dealer network.
Here are a few merchants that accept crypto via payment processors like BitPay and Coinbase:
Jeff Wyler Automotive Family in Ohio, Kentucky and Indiana
Carriage Auto Group in Georgia and Alabama
Bob Moore Auto Group in Oklahoma
Edmark Toyota in Nampa, Idaho
Lamborghini Newport Beach in Irvine, California.
Reed Jeep Chrysler Dodge Ram in Merriam, Kansas
Porsche Towson in Towson, Maryland
BMW of Rockville in Rockville, Maryland
Motor Cars of Atlanta in Atlanta, Georgia
Tesla CEO Elon Musk has gone back and forth on accepting Bitcoin as payment at Tesla TSLA,
stores, but at the time of writing, that system is not in place. However, if you want to buy a Tesla or other electric car with cryptocurrency, you may find some for sale on the crypto exchanges or at car dealers mentioned above.
See also: The Senate’s crypto bill seeks to regulate Bitcoin trading
Should I buy a car with crypto?
Anyone who has spent time with digital currency knows that there is a lot of risk associated with anything to do with crypto. Cryptocurrency values are extremely volatile.
For example, Bitcoin reached an all-time high of nearly $68,000 in November 2021. You could have bought a new Porsche 718 Cayman with one Bitcoin. But as of this writing, Bitcoin’s value is hovering around $20,000. The same Bitcoin that could have bought a Porsche less than a year ago will now get you a base Subaru Impreza.
See: Bitcoin bounces back. Thanks mom and pop investors.
Since car values do not fluctuate nearly as much as cryptocurrency values, stablecoins would be a good tool to pay for a car with digital currency. For example, putting USDC into a BitPay wallet and using it to make car payments is a safer way to pay for your car without worrying about the value of your crypto tanking.
If you are a true believer in cryptocurrency, buying a car directly with crypto like Bitcoin can be a great way to put this innovative technology to use. It can also be fun to tell your friends that you bought your car with Bitcoin.
This story originally ran on KBB.com.