Every year Bitcoin becomes more and more accessible and practical in everyday life. Major companies like Microsoft and Overstock have all begun accepting Bitcoin for some purchases.
While one of the primary purposes of Bitcoin was to empower users, governments have been trying their best to regulate the digital currency. This has caused unfriendly Bitcoin laws and has discouraged exchanges from doing business with people living under certain regulations.
Unfortunately, Bitcoiners in Hawaii among others, have fallen victim to these unfriendly regulations and rules.
As a result, Coinbase and other major exchanges have stopped dealing Bitcoin to Hawaiians.
Purchasing Bitcoin in Hawaii is still perfectly legal. However, it’s become more complex.
Ways to Buy Bitcoin in Hawaii
Hawaiians aren’t able to use all of the same exchanges that the rest of America is privileged with, but they do have options.
If you’re a Hawaiian looking to get your virtual hands on some Bitcoin, don’t stress.
There are 3 main ways to get Bitcoin on the island:
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You can use the limited amount of online exchanges that still work for Hawaii.
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You can join Bitcoin and cryptocurrency community groups via Facebook or Meetup.com to do some private trading.
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You can visit 1 of 7 of the physical Bitcoin ATMs available on the islands.
Let’s dive deeper into the exchanges and ATMs available to you.
Kraken
Founded in 2011, Kraken is one of the oldest and reputable cryptocurrency exchanges.
They’re based in the United States, but they offer service to nearly the whole world (excluding New York, Afghanistan, Cuba, Iran, Iraq, Japan, North Korea, and Tajikistan).
Benefits of using Kraken:
- Kraken has low transaction fees. Trading fees could be anywhere between 0.2-0.36% depending on your past 30-day trading volume.
- They offer a diverse range of cryptocurrencies to trade. You can buy and sell Bitcoin, Ethereum, Bitcoin Cash, Litecoin, Ripple, and Dash among a list of 20 available coins.
- You can buy with multiple fiat currencies (US dollars, Canadian dollars, Euros, and Pound sterlings).
- Kraken offers a dark pool. This is an anonymous order book that helps protect from unfavorable market shifts due to outsized orders.
Drawbacks of using Kraken:
- Kraken can be tricky for beginners. They offer a wide range of options for traders and a more complicated interface that can confuse new traders.
LocalBitcoins
LocalBitcoins is one of the oldest and global decentralized exchanges that operate through peer-to-peer trading.
Since it’s more privatized, they’re an excellent option to get around Hawaii’s tricky digital cryptocurrency laws.
Benefits of using LocalBitcoins:
- It’s extremely private. Details are only disclosed with the involved traders.
- You can pay with multiple payment methods. There is a vast range of currencies and ways to pay from, just don’t choose a reversible one like Paypal.
- There are no buying and selling limits.
- You typically get speedy delivery. Delivery is usually within 15 minutes, but it depends on the seller’s confirmation time.
- You only pay a flat 1% fee.
Drawbacks of using LocalBitcoins:
- The prices may be inflated. Since everything is up to the traders, the seller has the right to sell for their preferred amount. Also, payment methods affect the price.
- You need to be extra cautious. The exchange itself is secure, but check each seller’s reputation before trading.
Uphold
Uphold has been a cloud currency-holding platform with offices around the world since 2014.
They offer conversion services for 35 assets, including fiat currency, cryptocurrencies, and precious metals across 184 countries worldwide.
Benefits of using Uphold:
- You get a versatile cryptocurrency wallet.
- You can trade 9 cryptocurrencies (BTC, ETH, DASH, LTC, BAT, BCH, BTG, and XRP).
- Free member-to-member transactions.
Drawbacks of using Uphold:
- You’ll pay heftier fees. Funding and withdrawals from a debit and credit cards will pay a 3.99% fee.
- There are fund limits. US residents can’t withdraw more than $10,000 and deposit more than $500.
Bitstamp
Bitstamp has been a trustworthy exchange since 2011 and based in Luxembourg.
They offer to trade to countries all over the world with the most popular cryptocurrencies. They prefer trading with only the top coins so they can maintain quality over quantity.
Benefits of trading with Bitstamp:
- Most fees are cheap. General trading fees will be between 0.25% for orders under $20,000 and 0.10% for orders over $20,000,000.
- Bitstamp specializes in quality. They only trade Bitcoin, Ethereum, Litecoin, Ripple, and Bitcoin Cash, but they do it well.
Drawbacks of trading with Bitstamp:
- It may be difficult for beginners. Bitstamp’s interface is commonly used for big traders and may be tricky for novices.
- Debit and credit card users get more fees. For purchases under a $500 value, you’ll get slapped with an 8% fee.
Bitcoin ATMs
Hawaii may not have the most friendly cryptocurrency regulations, but that doesn’t stop them from having their own Bitcoin ATMs.
They have 7 across the islands with big fees ranging from 15-19%.
The History of Bitcoin in Hawaii
To understand the struggle of buying bitcoin and cryptocurrency in Hawaii, you need some brief history first.
Up until 2016, users could buy Bitcoin in Hawaii, just like most other states. In September of 2016, Hawaii lawmakers created a law that would make it mandatory for exchanges to hold cash reserves for collateral.
If a Hawaiin Bitcoiner owns $10,000 worth of BTC, the exchange would need to hold $10,000 of cash for the customer as well.
Exchanges that adhered to this new law would be sacrificing a magnitude of dollars just to comply with an incomprehensible rule.
Coinbase, one of the biggest exchanges, was discouraged by the law’s impracticality — calling the regulation “untenable.”
Exchanges are still seeking a better deal with legislators to pass fairer laws regarding digital currency. To no avail, news bills and efforts have all stalled in the Hawaiian House and Senate as of October 2019.
Coinbase and other exchanges are keeping their fingers crossed for a policy change that would encourage Hawaiin-Bitcoin exchanges in the future.
Hawaii is puzzled as to how to handle digital currencies, the trend looks gloomier with every restriction that is passed.
Conclusion
If you’re a Hawaiian, you might have a little more struggles than the average Bitcoiner, but that shouldn’t stop from getting in on the action. There are a handful of ways for you to trade, just beware of fees and make secure trades.
