Cody McGrath 
Buying cryptocurrency is legal in Hawaii, though not every crypto exchange on the market is licensed to do business with Hawaiian residents. The Hawaii Division of Financial Institutions launched a two-year pilot program that allows 15 crypto-based companies to do business with the state until June 2022. Six of those companies are crypto exchanges you can use to buy, sell and trade crypto.
How to buy crypto in Hawaii
Look for a crypto exchange admitted into Hawaii’s Digital Currency Innovation Lab (DCIL), which allows it to conduct business without a money transmitter license.
Step 1: Find an approved exchange.
Hawaii’s trial run into cryptocurrency allows six crypto exchanges to operate in the state. Residents looking to buy, sell or trade crypto can sign up for an account with DCIL approved exchanges.
Our top pick: Gemini Cryptocurrency Exchange
$0
Minimum Deposit
98
Cryptocurrencies
8
Fiat Currencies
| Deposit Methods | Bank transfer (ACH) Debit card Wire transfer |
|---|---|
| Deposit Fees | Cryptocurrency: None Wire transfer: None Bank transfer (ACH): None, bank fees may apply Debit card transfer: 3.49% |
| Withdrawal Fees | Cryptocurrency: None for first 10 withdrawals of each month Other: None for first 10 withdrawals of each month |
| Trading Fees | Order amount below USD 200: USD 0.99 – USD 2.99 Order amount over USD 200: 1.49% Convenience fee: 0.50% |
Once you find an exchange, to sign up you’ll typically need to:
- Create an account
- Verify your identity, typically with a valid ID
- Connect your digital wallet
- Deposit funds to make trades or purchases
Some exchanges allow you to fund your account with a credit or debit card, while others require wire transfers or linking bank accounts. If you have a preferred deposit method, confirm the exchange you’re interested in supports it, and understand any fees attached to these methods.
Step 2: Research digital wallets.
After you’ve narrowed down an exchange, you’ll need a crypto wallet. Crypto wallets are software, or hardware, designed to hold, transfer or display crypto currency and other digital assets.
You can compare popular crypto wallets by type, coins it supports and fees to find the best fit for your investments and budget.
Types of wallets you’ll encounter include:
- Hot wallet. Downloadable app or browser extension that’s always on.
- Cold wallet. External hardware that’s offline unless connected to a computer and turned on. They often resemble a thumb drive or storage device.
- Custodial wallet. Keeps track of your wallet’s keys — or master passwords.
- Noncustodial wallet. Leaves you in sole control of your wallet’s keys.
Popular wallets available for use in Hawaii include ZenGo, Exodus and Ledger.
Step 3: Buy crypto coins.
Once you deposit funds into your exchange account or digital wallet, you’re on your way to buying coins. You can find more than 70 coins to invest in through the exchange approved for business in Hawaii.
Bitcoin (BTC) and Ether (ETH) are universally listed on exchanges. If you’re interested in alt coins or memecoins like Dogecoin (DOGE), a larger exchange may be a good place to start — especially if you plan to diversify your crypto investments.
Crypto coins in Hawaii
Because exchanges are limited in Hawaii, you may not have access to all 7,000 coins on the market. Approved crypto ErisX and bitFlyer each list under 10 coins, with Gemini and Uphold featuring more than 50 coins.
Can I buy Dogecoin in Hawaii?
Yes. Gemini, SoFi, CEX.io and Uphold all list DOGE and are approved exchanges in Hawaii.
Can I buy Ethereum and Bitcoin in Hawaii?
Yes. Every exchange approved for business in Hawaii sells BTC and ETH.
You can also find Bitcoin ATMs that allow you to buy Bitcoin with cash. Transactions can come with a 3% to 5% markup for the convenience.
Where can I buy crypto in Hawaii?
Hawaii’s two-year pilot program approved 15 crypto-based businesses, of which six are true crypto exchanges you can use to buy, sell or trade crypto in the state.
bitFlyer Cryptocurrency Exchange
Founded in 2014, bitFlyer’s grown to become one of the largest exchanges worldwide with some 2.5 million users. It supports ETH, BTC, BCH, LTC, ETC, LSK and MONA and allows three fiat pairs: USD, EUR and JPY. Bank transfers, credit cards and PayPal accepted for deposits, with no trading or deposit fees — though watch for withdrawal fees that vary by transaction.
| Fiat currencies | 3 |
|---|---|
| Cryptocurrencies | 5 |
CEX.IO Cryptocurrency Exchange
Marketplace founded in 2013, extending from London to the US in 2019. Cex.io allows you to fund an account with ACH, credit cards, wire deposits. It lists 18 cryptocurrencies that include BTC, BCH, ETH and DOGE.
| Fiat currencies | 4 |
|---|---|
| Cryptocurrencies | 22 |
Founded in 2017 in Chicago. No account minimum. Lists BTC, ETH, LTC, BCH, USD Coin. Minimum order size depends on the coin, and trading and withdrawal fees widely vary. Does not allow for cold storage of coins. Savings accounts can be linked to your ErisX account.
| Fiat currencies | No supported |
|---|---|
| Cryptocurrencies | No supported |
Gemini Cryptocurrency Exchange
Founded in 2014 and based in New York. Lsts more than 50 coins that include BTC, ETH, SUSHI and DOGE. Transaction fees depend on your transaction amount, starting at $0.99 for a transaction of up to $10. No deposit fees with crypto or wire transfers, though you’ll pay 3.49% of your total purchase amount with a debit card transfer. Also created Gemini Dollar, the world’s first regulated stablecoin.
| Minimum deposits | $0 |
|---|---|
| Fiat currencies | 8 |
| Cryptocurrencies | 98 |
SoFi Cryptocurrency Exchange
Founded in 2011, this popular fintech offers multiple options for investing, including crypto. Lists 21 cryptocurrencies that include BTC, ETH, DOGE, LTC, SOL and ADA. No account minimum, and free financial counseling. Charges 1.25% markup on crypto transactions, supporting purchases of $10 to $50,000, with limits on select coins. You can’t transfer crypto to external wallets or accounts.
| Fiat currencies | 1 |
|---|---|
| Cryptocurrencies | 21 |
Uphold Digital Money Platform
Based in Silicon Valley and founded in 2013, boasts 7M+ users and serves 150+ countries. Trade between cryptocurrencies, precious metals, US equities and national currencies. Offers 76 currencies that include BTC, BCH, ADA, ETH and DOGE. Supports account funding from banks, cards and other crypto wallets. Deposit fee only on bank transfer wires — $20 for deposits of up to $5,000.
| Fiat currencies | No supported |
|---|---|
| Cryptocurrencies | No supported |
Hawaii laws and regulations around crypto
Hawaii’s Digital Currency Innovation Lab (DCIL) began approving crypto businesses to operate in Hawaii in two stages, starting in 2020.
In the first round, from March to May 2020, the state approved 12 of the 19 companies that applied. The second round, from January to February 2021, 14 more companies applied and only 4 made the cut.
The popular exchange Robinhood was originally included for approval, though it was removed on January 13, 2021. Local media has speculated that it came down to compliance around reporting requirements.
Approved companies are allowed to do business with Hawaii until June 30, 2022, followed by a “wind-down period” that ends on December 20, 2022, according to the DCIL.
It’s not clear what happens after this date for crypto investors in Hawaii.
Hawaii cryptocurrency taxes
Hawaii doesn’t offer guidance on sales or state taxation on cryptocurrency transactions.
However, unlike fiat currency like US dollars, cryptocurrencies are considered property by the IRS. You’re required to follow the same tax rules as other property transactions, which means reporting capital gains or losses after:
- Exchanging fiat currency for crypto
- Exchanging crypto for fiat currency
- Receiving rewards such as cash back and bonuses in crypto
Luckily, investors can track, manage and calculate crypto taxes they owe with the use of crypto tax software, with some providing easy filing tools and forms generated by tax authorities.
Know before you buy crypto in Hawaii
Until Hawaii’s two-year trial program officially ends at the end of 2022, you can rely on a handful of approved crypto exchanges to buy, sell and trade cryptocurrency. It’s unclear what steps the state will take after that, however.
Other things to note while buying and selling crypto include:
- Secure your digital wallet. A digital wallet can be accessed if someone gets a hold of its keys and/or passphrases. Keep those details secure – preferably somewhere offline so minimize risk of hacking.
- Read the fine print of marketplaces and exchanges. Many of these platforms are third-party entities, so if you find you’ve been scammed or cheated, the platform may not be able to help you recover stolen or lost assets.
- Watch out for scams. Unfortunately, scams seem to exist in every industry and crypto is no exception. Phishing scams are common, typically involving a scammer pretending to be a support rep and asking a user for passcodes/keys to their wallet. Call your wallet’s company help line directly to ask about suspicious contacts or anything else you’re not sure about.
- Cryptocurrency is volatile. The value of any coin can change in a matter of seconds, spelling major losses or gains that depend on interest and how much you invest.
Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators’ websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.