Where to Buy Bitcoin Montana

Buying bitcoin is legal in Montana. In particular cryptocurrency exchanges that facilitate the buying and selling of bitcoin do not need to register for a Money Transmitter license.

A snapshot of Montana Market:

Buying and Selling bitcoin is legal in Montana
Cryptocurrency exchange are not required to obtain a Montana Money Transmitter license.
The legal minimum age to buy cryptocurrency on an exchange is 18 years old.

In this article, we explain the best bitcoin exchanges to use, how to sign up and get started, how to choose an exchange that is right for you, the money transmitter and tax laws, and storing with wallets.

Top 5 Montana Bitcoin Exchanges

Overview of Montana Bitcoin Exchanges

If you intend to buy bitcoin on a cryptocurrency exchange, below is a summary of the steps you should follow:

To start off, you need to decide your bitcoin strategy. Do you intend to buy and hold? Do you want to trade frequently? Would you like to diversify?
Your strategy will assist you with determine what type of exchange is most suitable for you. There are several factors which you should consider, to align with your strategy.
Choose an exchange, you will need to sign up and create an account.
After verification and activated, choose a payment method to make a deposit.
Exchange deposit for bitcoin.
Store your bitcoin on a wallet.

In assisting with choosing an exchange, we outline the attributes that you should be aware of.

🔒 Safety and Security

Safety and security is important for user and exchange

During the early years of bitcoin, cryptocurrency exchanges were making headlines for being hacked, operating as scams and/or falsifying liquidity. But things have change dramatically, and exchanges are now meant to be licensed and regulated. In Mississippi, it is not necessary to be licensed to accept users, but some have exchanges have obtained a license anyways, which is a very good thing. It demonstrates that those exchanges who have acquired a Mississippi license are serious about being law abiding.

Exchanges have also improved their technology to be more secure. Strengthening infrastructure, putting in place better procedures, but also offering users functionality to protect user access and authorized transaction limits.

No exchange, however, can protect against a user’s carelessness of revealing passwords or losing keys. Nor can the State prevent users from mistakenly signing up to scams.

Weigh up safety and security. Though it has improved, it should still be at the forefront of consideration.

📞 Customer Support

Prompt, Accessible and Professional

You will find that Customer Suppport will be needed more times than you would think. Some users will need support going through the KYC process, some will need it to trade, and others will just have general questions about the platform.

Customer support needs to be accessible, whether it be through Live Chat, email or a hot line. It also needs to be prompt and accurate. Some customer support is AI driven. Useless if you have a specific question or need help urgently.

Customer Support is also supported with Self Help Centers – information portals with guides, procedures and rules. These self help centers are meant to be useful, easy to read and comprehensive. The low trading fee exchanges tend to push their Customer Support towards Self Help Centers. It’s one way of saving costs in an effort to allow for low trading fees.

In knowing this, you may find that low trading fee exchange, compromise on their Customer Support. Bear this in mind when choosing an exchange with low trading fees vs Customer Support.

💳 Payment Methods

Make sure your Payment Method is available

Many of the top Mississippi exchanges will offer the common US payments – ACH, wire transfers. Some will accept debit cards but with limits. Credit cards are much harder to come by, because many financial institutions will not facilitate it (even though it is lawful). Finally, there are very few that will also accept PayPal, Skill and Neteller.

The no frills exchanges may only accept one or two types of payment methods. This doesn’t necessarily mean that the exchange is bad, as long as you are willing to use the payment methods that they offer then there are no issues.

Payment methods are often sought by users for first and foremost Credit Cards. They want to use loyalty points on their cards to access greater rewards. The second most sought after payment methods, are the cheapest ones. Some payment methods will incurr a fee by the exchange which is passed onto the user. Each exchange will have a different fee for their payment methods that they offer.

🪙 Cryptocurrency Selection

Spread your investment

There are two aspects to cryptocurrency selection that should be considered. First, is the diversification benefit that can be obtain by buy several cryptocurrencies outside of bitcoin. Diversification is a common strategy among investors to spread their risk. This reduces volaility.

Secondly, some top exchanges have their own native coin. For example Binance and Crypto.com. With these exchanges, you will be rewarded with native coin, which could go up in value. The more users who join these exchanges, the more liquidity with the native coin.

These benefits should not be overlooked when considering an exchange.

🏷 Coupons and Discounts

Refer a friend and Claim Discounts

Most cryptocurrency exchanges use discounts and coupon codes to market themselves and cater attention of more and more traders. They convince traders to sign up to their platforms and enjoy significant reductions at the time of making transactions. In addition some also offer discounts when they refer a friend or make a specific amount of credit in the account.

Be careful when receiving emails touting great discounts or rewards when signing up. Often marketing of these incentives are pushed through email and various social media outlets. Do NOT subscribe or sign up to any of these marketing schemes. They are more often than not scams.

💰 Fees

Look for a low trading fee exchange, but balance other important attributes

Fees are a key attribute particularly if you are intending to trade often. While comparing fee percentage may show minor absolute differences, for example: a charge of 0.1% vs 0.2% is only an absolute difference of 0.1%, the 0.1% difference can actually translate to big dollar trading fee expenses. $1,000 in trading fees becomes $2,000 at another exchange.

Hence, particularly important for long term frequent traders, you should consider the fees (structure). However, be aware that the lowest fees, do not mean, they are the best exchange for you. Low fees tend to correlate to poor customer service. Don’t undervalue the importance of customer service, because you never know when you will need it as some point in time.

Sometime low fees can also be hidden among large spreads. Large spreads discount your buy and sell values, meaning you get less bang for your buck. It’s a way of an exchange clipping into your trade. There are some exchanges which market themselves as ZERO fee exchanges, but they catch you on the spreads.

⚙️ Platform Reliability

A reliable platform reduces frustration

The vast majority of exchanges are built on reliable platforms that are easy to use, interface well and don’t crash. But, as part of the licensing, they are required to continually improve their system controls, reliability and IT infrastructure. Occassionally, they will need to shut down their platform for maintenance which includes fixing bugs, upgrading software, adding new features. At most, a shut down will not last more than a day, and will occur outside of normal working hours.

For the vast majority of buyers of bitcoin who are long term traders, platform reliability is an important attribute but not as important as others that we have mentioned.

📈 Liquidity

High Liquidity leads to quick transactions

Choosing an exchange with high liquidity permits a fast transaction. Liquidity means the number of buyers and sellers. The more buyers and sellers on an exchange, the easier it is to come to an agreed exchange price. The less buyers and sellers, the longer it will take to agree. Therefore, if you are looking to buy and sell fast, a highly used exchange will provide good liquidity. Exchanges without liquidity may take an excessive amount of time to complete a trade. This is not great, especially if the market is moving fast, and you want to lock in any of the profits you have made.

However, liquidity may not be an issue for you if you are a buy and hold trader of bitcoin. Your bitcoin investment strategy will determine your purpose and whether liquidity is an important attribute to consider for an exchange.

Montana Bitcoin Exchange Reviews

Considering the above criteria, following is a review of several bitcoin exchanges for Montana.

Binance.US

Binance.US is one of the most popular exchanges in Montana. It is part of only a handful of exchanges that have formally obtained a Mississippi Money Transmitter license. Thus you can be assured that Binance.US is erring on the right side of the law, even though a license is not necessary. This makes Binance.US an attractive exchange to choose over others.

One reason for Binance.US’s popularity is its fees. The trading fees and narrow spreads are among the lowest which is attractive for regular buyer. Liquidity is probably the highest, so you will not find any better exchange for a quick bitcoin buy.

Another reason that Binance.US is popular is its native coin BNB. Users are rewarded with BNB for using the exchange, and BNB itself can also be traded. Creating an extraordinarily worthwhile investment.

Lastly, personal accounts can be established and verified within an hour. A no hassles quick start for the buyer who is in a hurry.

In summary, Binance.US is a trustworthy exchange to use to buy bitcoin. The pro’s certainly outweigh the con’s and certainly exceeds in comparison to other exchanges.

Money Transmitter License: Not required
Cryptocurrencies: 64
Mobile App: iOS and Android
Fees: 0.1% – 0.5%
Payment Methods: Debit Card, ACH, Wire Transfer

BlockFi – Avoid

*Update – In February 2022, BlockFi was issued a penalty by the US SEC amounting to $196m for accepting customers on their bitcoin interest earning account. BlockFi has agreed to stop accepting new customers, pay the penalty, while sanctioned to maintaining existing account holders.

Not many users have heard of BlockFi as an exchange, but they may know of it as a deposit/lender of bitcoin. Offering a good interest rate, for those who don’t want their bitcoin just sitting on their wallet being idle. On the flip side, you can borrow bitcoins from BlockFi, if you want to leverage or need it for business transactions.

It have recently launched an exchange to compliment their deposit and lending facility. The exchange is still in its infancy, only accepting ACH transactions and fees are “zero” which means they are embedded in the spread. Lack of transparency of fees is concerning, with many user prefering low trading fee and narrow spread exchanges.

BlockFi may turn out to have a great exchange. But for the time being perhaps give this one a miss.

Money Transmitter License: Not required
Payment Methods: ACH
Mobile App: iOS and Android
Fees: embedded in the spread
Only supports crypto pairs

CEX.IO

Valued at $43 billion, over 4 million customers, CEX.IO is a UK based worldwide exchange. Supporting over 100 cryptocurrencies, it most certainly is the best exchange to use to diversify quickly and with convenience. Its platform is advanced, and is suited for the experienced trader, while fees are reasonable.

For beginners the platform maybe confusing at first – lots of products, features and reporting that can be used. The platform is most definitely secure and safe, with regulations to be met in the UK, as well as US FinCen. Unfortunately it is not licensed in Montana, however it continues to accept local residents. This is not a huge issue, but we do prefer exchanges that are licensed, even though it isn’t necessary. Better to be safe than sorry.

Money Transmitter License: Not required
Cryptocurrencies: 100+
Mobile App: iOS and Android
Fees: 0.15% – 0.25% + deposit and withdrawal fees
Payment Methods: Debit Card, Credit Card, ACH, Wire Transfer

Coinbase Pro

Coinbase Pro is a great exchange that many in Montana are using. Coinbase is a licensed Money Transmitter in the State, hence you can be assured of its safety and security.

Users like the low trading fees, but also a reliable platform and selection of supported cryptocurrencies. The downside is that the fee structure is quite complex. So just be cautious when choosing your payment method and trading volume if you are concerned about fees.

Also note, that there are two platforms. Coinbase and Coinbase Pro. The latter is the cheaper platform is suitable for a trader seeking to buy and sell bitcoin regularly. The Coinbase (generic) platform is the basic version which charges more for instant bitcoin buys.

Money Transmitter License: Not required
Cryptocurrencies: 96
Mobile App: iOS and Android
Fees: 0.5% – 4.5%
Payment Methods: Debit Card, Credit Card, ACH, Wire Transfer

Coinmama

For beginners, you can’t go past Coinmama – intuitive, simple and well thought out user experience. Buying bitcoin on Coinmama could not be any easier. It’s fees aren’t the lowest around, but it excels with customer support. At just under 100 supported cryptocurrencies, you can easily divest your digital assets and spread your risk.

The exchange is reliable and offer both Android and iOS mobile apps.

Choose Coinmama if you want a no fuss quick buy bitcoin exchange.

Money Transmitter License: Not required
Cryptocurrencies: 96
Mobile App: iOS and Android
Fees: 0.5% – 4.5%
Payment Methods: Debit Card, Credit Card, ACH, Wire Transfer

Crypto.com (CDC)

Crypto.com is splashing out with marketing to become the biggest exchange in Montana. Joining forces with the well known basketball player Lebron James and the movie star Matt Damon, you will definitely see lots of promos. Crypto.com is now also the name of the LA sport stadium that used to be called the Staples Center.

Looking beyond its marketing campaign, Crypto.com is an exchange that offers many perks, and excellent trading experience. One of the perks is being rewarded with the native coin CRO. The more you use Crypto.com the more CRO you can earn.

CRO can also be traded, just like any other cryptocurrency. Hence, there is a lot of upside with trading on Crypto.com.

Crypto.com offers a fantastic debit card made of metal. It is widely accepted, but undoubtedly heavy. To be honest, it is very gimmicky, and could be a good talking point at a party, but it still is just a debit card, i.e. the functionality is the same as any other.

The app is sturdy, robust and mostly glitch free. If there are any issues, users have found by simply uninstalling and reinstalling the app, it begins to work smoothly again. Trading fees are among the lowest, though spreads are just ok. As Crypto.com grows, we expect to see better spreads.

Money Transmitter License: Not required
Cryptocurrencies: 96
Mobile App: iOS and Android
Fees: 0.5% – 4.5%
Payment Methods: Debit Card, Credit Card, ACH, Wire Transfer

eToro

eToro comes across as professional, sharp and powerful. But at the end of the day, when an exchange purports that they have “zero” trading fees, and takes a cut through the widening of spreads, let’s just say transparency is lacking.

There is no question, that eToro has an excellent platform. Their history of trading in foreign currency and extending it to cryptocurrency allows eToro to have one of the best platforms. Smooth, seamless, mostly glitch free, the system is easy to use even for the beginner.

The support cryptocurrencies is limited, at only under thirty, and while it states that they are licensed on their exchange, they don’t explicitly mention their license number.

We like eToro for their exchange capabilities, the trading features that can allow you to implement strategic bitcon buy and sells, but we dislike its lack of transparency in fees.

Money Transmitter License: Not required
Cryptocurrencies: 27
Mobile App: iOS and Android
Fees: zero (but huge spreads making eToro more expensive than Binance.US and Coinbase).
Payment Methods: Wire, ACH, PayPal, e-wallets

FTX.US

FTX.US is competing strongly against Crypto.com in terms of marketing. Partnering several NBA, NFL and MLB teams, it’s biggest drawcard is having Tom Brady as a shareholder and brand ambassador.

Strikingly, FTX.US is the lowest trading fee exchange (without any hidden cuts in the spread). This is certainly attracting many customers to its platform. Unfortunately, the support currencies is a little light at only 20.

Nevertheless, FTX.US is one of the best buy bitcoin exchanges available for Montana.

Money Transmitter License: Not required
Cryptocurrencies: 20
Mobile App: iOS and Android
Fees: 0.4% – 5.0%
Payment Methods: Wire, ACH, PayPal, e-wallets

Kraken

Belongs in the top exchanges for Montana, Kraken has been around since the early days of Bitcoin. Famously begun to provide an alernatively to Mt. Gox (which infamously made headline for millions of stolen bitcoins), Kraken has never been “publicly” hacked.

Similar to Coinbase, there is a basic platform and an advance user platform Kraken Pro.

The platform has many users, hence liquidity is not a problem, and fees are reasonable.

Money Transmitter License: Not required
Cryptocurrencies: 115
Mobile App: iOS and Android
Fees: 0.4% – 5.0%
Payment Methods: Wire, ACH, PayPal, e-wallets

Nexo.io

Nexo is a Euro based deposit and lending platform which has branched out to being an exchange. It has followed the same path of BlockFi (with the only difference that BlockFi is USA based).

In knowing that Nexo is offshore based, users may want to choose BlockFi for that extra piece of mind. However, BlockFi is also new to the exchange business as well.

Certainly the deposit and lending business of bitcoin has made a healthy return for many in the industry. How Nexo.io can make ground in the exchange area remains to be seen with an overcrowded market in the US.

Fees – Zero

LocalBitcoins

Known for providing an escrow service, this cryptocurrency platform enables clients to find the right buyers for their Bitcoins. Although advertisement is a good option to go with, many have not received the required level of responses. The thing that makes LocalBitcoins different from others is the in-person meeting, which is facilitated and secured by LocalBitcoins have turned out to the fastest platform to acquire Bitcoins within a few minutes.

Montana Cryptocurrency Tax Ruling and Rates

Bitcoin and other cryptocurrencies is a taxable asset in the eyes of the IRS. Therefore when you buy and sell bitcoin, you will need to calculate how much tax is payable. Tax is dependent on the outcome of realizing capital gains or losses. The tax rates differ between short term and long term, which is defined by one year. Short term realized gains have tax rates that are in alignment with personal income tax rates. While long term realized gains have an average of 20% (but may differ depending on your circumstances).

Be prepared to submit to the IRS details of your trading activity. Most exchanges will provide tax reports which will help with the IRS submission.

Bitcoin Cryptocurrency Laws and Legislation

Montana is the last mover of all states to amend their money transmitter act to include the defintion of virtual currency and its monetary value. As a result, cryptocurrency exchanges are not required to be licensed to accept residents from Montana.

Despite not legally recognizing virtual currency facilitators, the State has closed out a loop with political donations via cryptocurrency. The Electronic Contributions Act now includes bitcoin to be made via the political contributions via the official payment gateway. Mont. Admin. R. § 44.11.408.

Bitcoin and Cryptocurrency Wallets

Some exchanges also offer wallets. It’s not necessary for a good exchange to offer a wallet to their clients, though it can be a nice to have for new investors. However, be aware that online wallets offered by exchanges are normally hot wallets. That is, these wallets are connected permanently to the internet. This can be quite risky to use a wallet that is controlled by the exchange and not by yourself.

Hence it’s not necessarily a good thing if an exchange offers a wallet, but it’s a nice to have, if you are looking for an exchange with their own wallet.

Online Wallets: Every crypto-exchange has their own wallet where traders can store their coins or cryptocurrencies for as long as they want. However, there are two types of these wallets that traders have to decide about which wallet they want to use for their trading.
Montana Hot Wallets: Since the inception of bitcoins and other cryptocurrencies, wallets have been transformed and divided into two forms- desktop and online. Digital wallets are free and can hold any cryptocurrency that traders want. They enable them to get easy access to their cryptocurrencies via mobile devices. They are perfect for beginners who want something easy to start with.
Montana Cold Wallets: These specifically designed devices work as physical cryptocurrency storage that allow traders to bring their cryptos with them, no matter where they are going. Though, the only considerable thing is their expensive nature with limitations of storing certain cryptocurrencies for future use.

Minimum Legal Age

Considering the regulations from the law, a trader should be at least 18 years old to be a part of any of the cryptocurrency exchange

Summary

The State of Montana is the last of all US States to amend their Money Transmitter Act to include virtual currencies. As a result there is no requirement for exchanges to be state licensed. Therefore, in Montana there is a good selection of exchange to choose when buying bitcoin. When selecting an exchange there are various attributes to consider – fees, safety and security, liquidity, supported currencies, platform reliability and customer service. Make sure you select an exchange that fits your trading strategy.

In addition to exchanges, you can also buy bitcoin at ATMs. Buying through bitcoin ATMs is easy, however fees are very much higher than an online exchange.

If you profit or earn an income using bitcoin, you are required to pay tax to the IRS.

According to Federal Law you are required to be at least 18 years old to buy and sell bitcoin on an exchange.

How to Lodge a Cryptocurrency Customer Complaint

If you have a customer complaint at a cryptocurrency exchange, please raise the issue with them first.

If unresolved, please contact the State Finance Department.

Montana Department of Administration – Banking & Financial Institutions
301 S. Park Ave, Suite 316
Helena, MT 59601
Mailing Address: PO Box 200546 Helena MT 59620
Phone: 406-841-2920
Fax: 406-841-2930

https://banking.mt.gov/Complaints