Imagine whipping around in a G-Wagon or a drop-top Bentley Continental or hearing the sweet sounds of a V12 LaFerrari as you rip down the road. Sounds pretty nice, right? You might assume that you need a massive salary, a couple of investment accounts, and a whole lot of cash to get one of these sick rides in your driveway. But, in the wild world of 2021, you can now buy one of these cars with cryptocurrency!
That’s right, if you hit it big with one of your crypto investments, you can actually purchase a car now. You can buy a car without ever cashing out your Bitcoin, or Ethereum, or whatever other cryptos you’re invested in!
In this article, I’m going to go through why buying a car with crypto is something you might want to consider, where you can buy a car with crypto these days, and how the process of exchanging cryptocurrency for a new set of wheels works. This is how to buy a car with crypto!
Who says that cryptocurrency is just an investment and not a real currency? In today’s world, you can purchase pretty much any kind of car imaginable with cryptocurrency. So, before I tell you how the whole process works, let’s look at all the many places where your crypto can get you behind the wheel of a new car!
Crypto Car Dealers – Where To Buy
Alright, so let’s kick things off with one of the coolest places that is now accepting Bitcoin in exchange for luxury vehicles, an awesome website called BitCars. This online service comes from the same people who started BitDials, a company that started selling jewelry in exchange for Bitcoin, and now they’ve taken that business model and adapted it to help us car enthusiasts out.
The first car they ever sold was a badass Rolls-Royce Dawn that had All-Black Tuning done by Mansory. But, since then, they’ve expanded their fleet to include all types of supercars, American classics, luxury sedans, and SUVs, and much more.
If you’re looking to get a low-cost Nissan Altima, BitCars ain’t the place. But, if you got big numbers in your Bitcoin wallet and you’re looking to get some top-of-the-line automotive engineering, they got just what you need. Oh, and they also have off-road vehicles, motorhomes, motorcycles, and even freakin’ yachts available to buy with Bitcoin. Now that’s pretty damn cool.
If you’re not in the 1% of the wealth bracket, however, there are also places where you can get more normal cars with crypto. Car dealers accepting crypto payments have been cropping up all over the country, and even around the world.
Carriage Nissan down in Atlanta now accepts payments of Bitcoin. Bob Moore Auto Dealers, a company with 18 different dealerships across Oklahoma and offerings of pretty much every car brand you can imagine, has been accepting payments in Bitcoin, Ethereum, and Litecoin for years. Bernie Moreno dealerships in Cleveland also accept Bitcoin for their Benz and Porsche models.
In general, it’s way easier to find a dealership that accepts crypto if you’re shopping in the luxury market, but if you want a budget commuter car, there are still places out there that will accept your digital currency.
Oh, and there’s one other major name I have to mention, of course. I’m talking about Tesla! That’s right, if you wanted to hop into one of Elon Musk’s cutting-edge EVs, there was a time when you could’ve paid in Bitcoin. Unfortunately, Elon Musk just tweeted that Tesla will stop accepting Bitcoin for car purchases, and Bitcoin immediately plunged like 20%. What a shame.
The decision kind of makes sense, since when Tesla announced in March it would accept Bitcoin, environmentalists were pissed! You see, Bitcoin mining and transactions use a ton of energy, specifically fossil fuels like coal, which is pretty bad for the environment. So, although accepting cryptocurrency is a great idea in theory, Mother Nature isn’t too happy about it! Even though Tesla holds over $1.5 billion of cash reserves in Bitcoin and is a big supporter of Bitcoin, they’ve got to figure out the energy issue before it makes environmental sense.
With all these different dealers and manufacturers now accepting crypto as payment, it’s clear that digital assets like Bitcoin and Ethereum are now becoming a more accepted form of currency. But, just because you can buy a car with crypto these days, doesn’t mean you necessarily should.
Should You Buy a Car With Crypto? – Crypto or Cash?
So, here’s the thing: the only real advantage of buying a car with crypto instead of cash is that you might be able to avoid some transaction fees with your crypto wallet provider.
Let’s say you have your crypto held in Coinbase, which charges a 1% fee to withdraw your crypto. If you’re trying to withdraw the amount of money you need to buy a million-dollar car, that 1% is a whole $10,000. That’s a solid chunk of change. So, by purchasing that million-dollar car directly with crypto, you can avoid paying that 1% fee altogether, which sounds pretty nice, right?
Well, here’s the other thing: the prices of crypto are so volatile right now that it’s hard to know if your investment in a car bought with crypto is going to be a great deal or an absolutely awful one.
For instance, let’s say you bought a car for one Bitcoin, and the price of Bitcoin as I’m writing this is $38,000, more or less. And then, the very next day after you bought the car, the price of Bitcoin skyrockets up to $100,000. That pretty much means you just paid $100,000 for a car worth $57,000! So, that Bitcoin car dealer basically shafted you for way more money than you needed to spend.
However, there’s also the chance that you could come out on top. Let’s say that the day after you bought that car for one Bitcoin, the price of Bitcoin plunges down to like $10,000. That means you just got a car worth $57,000 for $10,000, which is an awesome deal for you!
So, as I’m sure you can tell, buying a car with any crypto is a serious game of chance, and depending on what the price of that crypto does, you could come out a serious winner or a serious loser. And you might be thinking, Well, I’ll just trade the car in for my Bitcoin if the price goes up. Nope, with all these dealers, all refunds and buybacks are done on the basis of what the price of Bitcoin was at the time of the purchase, not the current price of Bitcoin, or whatever other crypto you’re using.
So, really, it’s a gamble for both you and the dealer. However, it seems like the odds are more in the dealers’ favor because the risk of trading in crypto is usually baked into the price. Take the LaFerrari listed on BitCars, for example. At the current price of Bitcoin, the cost in dollars of that LaFerrari on BitCars is about $4.12 million. If you look at LaFerrari values from pretty much any other online dealer, they don’t really climb above $3.5 million on the high end. It seems like BitCars is charging a premium so that the buyer takes on most of the risk with Bitcoin’s price volatility.
All that considered, while it is super cool that you can buy a car with crypto, it’s definitely a safer decision to just buy it with regular old cash. However, if you do want to still buy a car with crypto, let me run you through how to do it real fast.
The Transaction Process – How To Buy a Car With Crypto
If you’re still set on buying a car with crypto, this is basically how it works. First, you have to buy up a whole lot of cryptocurrency, probably Bitcoin, because it’s the most widely accepted with car dealers. That’s going to require you to have a crypto wallet, which you can have through a service like Coinbase or eToro.
Then, you’re going to have to download a secure crypto transfer app. Most of these car dealers use BitPay, unless you were buying from Tesla, which was using a very similar app called BTCPay. These apps are super easy to use. You just have to hook up your crypto wallet and then your dealer can request payment through the app. And there you go! You’re ready to buy a car with crypto!
However, for all the reasons I mentioned before, you’re probably better off just sticking with cash unless you’re pretty much positive that the price of a crypto is going to go way down.