Best Ways to Buy Bitcoin With PayPal: Beginners Guide

Last updated: Mar 30, 2023
9 Min Read

Buying Bitcoin has become significantly easier over the past few years. A growing number of exchanges, simplified purchases processes and a larger selection of payment methods means people are able to get some Bitcoin, even when they aren’t technically inclined.

One of the top payment processors in the world is Paypal, so it shouldn’t come as a surprise that many people would like to use Paypal to buy Bitcoin. Unfortunately, the chargeback policy of Paypal that allows charges to be easily reversed, combined with the irreversible nature of Bitcoin transactions, means there aren’t many exchanges willing to accept Paypal.

There are a few ways to buy Bitcoin with Paypal, but they aren’t as straightforward or easy as the most popular methods of purchasing Bitcoin. It can be done though, and that’s why we’ve put together this guide to the 3 best ways to buy Bitcoin with Paypal.

3 Ways to Buy Bitcoin with PayPal

There are basically three options for buying Bitcoin via Paypal currently:

  1. Peer-to-peer (P2P) marketplaces – These are similar to exchanges, but rather than acting as a third-party in the exchange transaction they simply exist to allow buyers and sellers to find each other and then transact separately from the exchange. These P2P marketplaces were the first way to exchange fiat for Bitcoin, and they remain popular thanks to their emphasis on decentralization, privacy, and anonymity. Because the buyers decide what payment method to accept it is possible to find buyers who will accept Paypal on the P2P marketplaces.
  2. Cryptocurrency exchanges – There are almost no cryptocurrency exchanges that continue to accept Paypal because most got burned early in their existence by Paypal chargebacks. These days there is only one exchange that still accepts Paypal in a roundabout way.
  3. Peer-to-peer (P2P) lending platforms – Peer-to-peer lending is a fairly new development and users have found that they can use these platforms to borrow Bitcoin and then immediately pay off the loan using a Paypal account. It’s a unique solution for those who want to use Paypal to buy Bitcoin.

Below you can find an example and guide of a platform in each of the above service types.

P2P Marketplace: LocalBitcoins

LocalBitcoins is almost certainly the most well-known P2P marketplace for buying and selling Bitcoin. It was one of the first of its kind, having started in 2012. Initially, it was meant to connect those who were close geographically to meet face-to-face to exchange Bitcoin for fiat or other assets. These days it has grown and with an escrow service in use, you can find buyers or sellers from around the world.

LocalBitcoins Buy Bitcoin
Finding PayPal Sellers on Localbitcoins

While some caution is needed because you’re connecting with users from all over the world, the service has taken serious steps to become as secure as possible, and in 2019 using LocalBitcoins is fairly safe and secure thanks to the above-mentioned escrow service and a seller reputation system.

Using LocalBitcoins to buy Bitcoin with Paypal is a pretty straightforward and easy process. Like any service, it begins with creating an account. Once you verify your email address to confirm your account you’re ready to buy some Bitcoin.

There’s a search form that allows you to filter by country, currency, and the payment method. The country will default to your country, and for the currency, you’d choose your local currency, and select Paypal as the payment method.

After submitting your search you’ll be presented with a list of sellers that meet your criteria. When you choose a seller there are some important metrics you should look for:

  1. Look for a feedback score as close to 100% as possible.
  2. More trades and higher trade volumes are better.
  3. Look at the seller trade limits to ensure they can fill your order.
  4. Check the payment terms to see how long you have to complete your side of the transaction.
  5. Read the seller terms. Some sellers also require a minimum buyer reputation so you may have to pass on them until you’ve made some transactions and increased your reputation.
Localbitcoins Seller Profile
Profile of a top seller on Localbitcoins

After choosing a seller you begin the purchase by clicking the “Buy” button. That brings up a form where you can enter your purchase amount and any other comments you might have for the seller. From this point on you should only communicate with the seller through the LocalBitcoins platform. If you communicate outside the platform there’s no record in the event of a dispute.

Do realize that there’s a cost to buying Bitcoin with Paypal. That cost is a very high premium from most sellers. In some cases, this can be as much as 20% above the spot price of Bitcoin. One way to avoid these premiums and still use Paypal is to withdraw cash from your Paypal account and use that cash to pay for Bitcoin on LocalBitcoins.

P2P Marketplace: Paxful

If you are looking for an alternative to Localbitcoins then Paxful is probably your next best bet. Like localbitcoins, this is a Peer-to-Peer marketplace where you can buy Bitcoin from the online sellers.

You will need to create a Paxful account in order to take part in the marketplace. You will also need to have a verified USA based PayPal account. You can get a verified account on PayPal assuming that you have linked your bank account, credit card and have submitted some ID documentation.

Using Paxful works much the same was as you would with Localbitcoins. You will need to search for the best deals according to your criteria. Below we have searched for all of the offers that are available for a PayPal purchase of our chosen amount.

But Bitcoin PayPal Paxful
List of Bitcoin sellers who accept PayPal

Each of the listings will disclose what they require from you before they will authorise the purchase. As is the case with other P2P marketplaces, you will want to make sure that you are using a seller that has a good reputation in the community. Below is the seller profile of the top ranked Paxful seller according to our criteria.

But Bitcoin PayPal Paxful
Paxful Bitcoin seller rating

As you can see, ROIWITHME has been verified and has completed over 19,000 trades on the platform. His rating is also pretty outstanding for a P2P seller. However, if you are going to be trading with this seller then he will need a copy of your photo ID.

Lastly, Paxful also has a handy escrow service which you can use to help facilitate the transaction. Of course, when you are using PayPal the seller is less likely to pull a fast one. This is because of the strict buyer protections they have implemented.

Cryptocurrency Exchange: VirWoX

VirWoX has been around since before Bitcoin was created, having started in 2007 as an exchange for virtual game currencies. The largest game currency it supports is the Second Life Lindens (SLLs) from the game Second Life. Users can buy SLLs in many ways, including with Bitcoin and with Paypal. This has led to a unique way to buy Bitcoin with Paypal.

Using VirWoX isn’t difficult, but the process is long and roundabout, and it is expensive.

Buying SSL with PayPal
VirWox exchange for Second Life Lindens

As with any platform you begin by creating and verifying an account. You receive a temporary password that has to be changed within 24 hours to activate your account.

Once your account is activated you can make a deposit to your VirWoX account. They accept USD, EUR, GBP and CHF without fees. If you use other currencies there will be additional conversion fees.

It can take up to 48 hours for the deposit to clear and then you’re ready to make the first exchange, which is fiat for SLL. After purchasing SLL you go back to the VirWoX Exchange and trade your SLL for BTC. Once the transaction is complete you’re free to send the BTC to any external wallet.

In addition to the time you’ll spend with this method there’s also a 10% fee imposed by VirWoX on Paypal purchases.

Peer-to-Peer Lending: xCoins

Peer-to-peer lending marketplaces are new, and they have also emerged as a way to buy Bitcoin with Paypal. The P2P lending marketplace works by allowing Bitcoin holders to offer their coins on loan and get an interest payment on the outstanding loan amount. xCoins will accept Paypal to repay loans, which makes it possible to borrow Bitcoin and then pay the loan with Paypal, which is essentially buying Bitcoin with Paypal.

PayPal on xCoin Lending
How xCoin lending works with PayPal

You start as usual by creating an account at xCoins. After submitting the registration form you get a code from xCoins via email. You use that code to complete the registration at the xCoins website, after which you’ll be asked for a password of your choosing, your country and state/province/county and your phone number to enable 2-factor authentication.

Once that’s complete you can begin borrowing Bitcoin. The initial limit is $100/day, which increases over time. By 90 days you can borrow $1,000 in BTC per day. Like the two examples above buying Bitcoin using Paypal at xCoins is expensive and could cost you up to 25-30% in fees.


While you can buy Bitcoin with Paypal, it can be pretty expensive. You’ll also be limited at first in how much you can buy, and there aren’t a whole lot of choices for platforms to make the purchase. However, if you have to use Paypal you’ll be glad to have the information.

The best platform for you will depend on your own needs. Check each one and see which seems to work best. Everyone is different and while LocalBitcoins might be best for some people, others will prefer xCoins or VirWoX or Paxful.

Steve Walters

Steve has been writing for the financial markets for the past 7 years and during that time has developed a growing passion for cryptocurrencies.

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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