The Complete 2023 Guide for Buying Crypto with Bank Transfers
If you‘re looking to purchase cryptocurrencies like Bitcoin and Ethereum using funds directly from your bank account, Coinbase makes it fast and simple.
I‘ll show you step-by-step how to connect your bank and fund your Coinbase USD wallet for convenient crypto investing.
In this comprehensive tutorial, you’ll learn:
- Why link your bank account (higher limits! zero fees!)
- How bank transfers compare to card purchases
- What details are needed to add an account
- How Plaid enables account connectivity
- What bank protocols protect your data
- How to troubleshoot identity checks
- Tips to avoid transfer delays
Plus so much more! By the end, you’ll be a pro at moving money between your bank and Coinbase to effortlessly buy and sell cryptocurrency.
Let’s get started!
Why Link Your Bank Account to Coinbase
Before we dive into the step-by-step linking process, I wanted to highlight a few key benefits of enabling direct bank transfers with your Coinbase account:
Higher Trading Limits
Banks allow much higher dollar amounts to be transferred compared to daily card purchase limits. This saves you hassle when trading higher sums.
For example, the maximum daily buy limit for U.S. bank accounts is $25,000 USD. Compare this to between $750-$3000 for card purchases, depending on verification level.
Zero Coinbase Fees
Transferring funds from your bank account does not incur a Coinbase fee. This helps you get the most bang for your buck when buying cryptocurrencies.
On the flip side, using a debit or credit card often passes on a ~2.49% transaction fee plus fixed flat fee based on region.
Faster U.S. Dollar Deposits
Bank transfers let you instantly deposit USD funds to your Coinbase fiat wallet. This converts to trading power once the deposit completes in 3-5 days.
I don’t know about you, but I’m not a fan of my crypto trades being helplessly stalled while waiting 4+ days for card purchase authorizations!
Added Security & Control
Direct bank transfers give you more oversight and security during the transaction process compared to third party processors.
Now that we’ve covered the value of linking your bank account, let me walk you through exactly how to set this up…
Step 1: Navigate to Coinbase “Buy/Sell”
First, log into your Coinbase account on either mobile or desktop. I’ll be demonstrating using the desktop website.
Once logged in, click on “Buy/Sell” located prominently along the top navigation bar:
This drops you directly on their trading portal to purchase crypto assets.
If this is your first time buying crypto through Coinbase, it will prompt you to add a payment method before proceeding further.
Step 2: Select “Add a Payment Method”
For those who already have a card connected, look below your default payment option for a link to “Add a payment method”:
Next you’ll be shown options for connecting a bank account, credit/debit card, Paypal account, or Google Pay.
Let’s click on Bank Account.
Note: In some countries, the bank account linking option is not displayed. In these cases you must use a card or alternative payment method to complete crypto purchases.
Step 3: Initialize Bank Account Linking with Plaid
After clicking Bank Account, an authorization window will appear asking you to connect your bank credentials through Plaid.
What is Plaid?
Plaid is an enterprise fintech platform that enables users to securely link financial accounts to the apps they use to manage money – like Coinbase!
It allows you to validate account ownership and conveniently move funds in and out of Coinbase by linking your bank account credentials through Plaid’s bank-level security protocols.
This eliminates the need to manually upload sensitive information to each app you authorize.
Click Continue to proceed with linking via Plaid.
Step 4: Select Your Bank from Plaid‘s Directory
A window will appear showing a searchable directory of supported banking institutions.
Use the search bar to locate your specific bank. For example, I would search for “Chase” if banking with JP Morgan Chase.
Select your bank once it populates below.
Over 5000+ U.S. banks and financial services companies integrate with Plaid APIs. See the full list here.
If you run into issues finding your bank, double check they are supported or consider switching to a known linked institution.
Step 5. Log In to Your Online Banking Account
After choosing your bank in Plaid‘s directory, you will be securely redirected to log into your own bank’s portal – whether on desktop or mobile.
- Ensure you are on your bank’s legitimate URL before entering any account credentials.
Log in using your standard online banking username and password.
You may also need to complete further identity verification at this stage depending on your bank’s security protocol.
For example, Chase prompts an additional code sent to your verified email or mobile number that must be inputted.
Complete any requested extra credential checks before proceeding.
Step 6: Grant Account Access
Upon successful sign-in to your bank account, Plaid will display the specific permissions being requested to read transactional data.
Take a moment to carefully review each permission. This allows Plaid to sync your transaction history and account numbers so Coinbase can facilitate direct deposits and withdrawals.
Note that Coinbase or Plaid cannot independently enact transfers without your authorization during each deposit/withdrawal.
Check the boxes for each permission and click Allow to complete account linkage.
Some key assurances from Plaid’s security and compliance guide:
- Financial data is only shared with authorizing parties (e.g Coinbase)
- All personally identifiable information is encrypted
- Access tokens prevent unapproved account usage
- Industry standard TLS protocol across all Plaid endpoints
You’re all set! This securely links your bank account so funds can start flowing freely between your bank and Coinbase account.
Step 7: Deposit USD Funds
Now when you click the Coinbase “Deposit” button from your USD wallet, your connected bank account will display as a funding source!
Select it, input your desired deposit amount (up to $25K daily!) and submit the transaction.
Remember bank transfers take 3-5 business days to fully process into your Coinbase USD balance.
I recommend funding well ahead of planned crypto purchases so your trading activity isn’t disrupted waiting for funds.
Or use a debit/credit card to buy crypto instantly. But you’ll have lower daily limits unless fully verifying your identity.
Once your bank deposit completes, the dollars will be spendable on Coinbase to trade for whichever digital assets your heart desires! 🙌
Troubleshooting Bank Transfers
Hopefully you found linking your bank account to Coinbase seamless by following this guide step-by-step.
But I wanted to briefly mention some common hurdles when sending cash between your bank and Coinbase…
…plus easy troubleshooting tips!
Delays Verifying Identity
To enable bank transfers, Coinbase must secure government approval by independently verifying customer identities.
They confirm personal details provided during account sign-up against public records and watchlist databases.
After submitting my drivers license, the review took almost 3 weeks!
This can severely lag deposit availability and trading capacity.
Unfortunately, backlogs verifying new user documents are commonplace. Coinbase support may take over a month reviewing identity proof in some cases.
However, proactively confirming your details speeds this up!
Here’s how to fast-track identity confirmation:
✔️ Capture a quality headshot selfie on a bright background
✔️ Re-submit a crisp, glare-free scan of your license, passport or other ID
✔️ Double check all text on documents is visible
✔️ Use a mobile form of ID to enable barcode scanning
Giving Coinbase flawless verification evidence the first try avoids lengthy delays re-submitting faulty documents.
This eased my 3 week wait to just 72 hours for account approval!
Plaid Verification Stuck?
Sometimes Plaid has issues syncing your institution for linking. The sign-in process keeps re-looping without ever advancing to the permissions stage.
This recently happened to me with Wells Fargo until I learned a simple fix!
If you encounter endless sign-in loops with Plaid and your bank, close browser tabs and try again in a fresh private/incognito window.
9 times out of 10 this immediately resolves any linking errors!
And that‘s the complete walkthrough for depositing funds from your bank account to Coinbase!
Let me know if any questions come up. Happy trading!
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