Getting started with Cryptocurrency
Introduction
I’ve had several people reach out to me about getting started with crypto’s so I put this handy little document together. I’d like to remind everyone that this is a VERY volatile market so you should only invest what you can afford to lose. One day you could be up 100% and the next down 100% so be very careful and be very responsible. I don’t want any of my friends losing their shirts. On to the intro!
CoinBase
Your first step is going to be to create a coinbase account. You need to do this to get USD into a crypto exchange. Go to https://www.coinbase.com
Step 1: Signup
Step 2: Identity Verification
Verify your account by opening the email that was sent to you. Fill out the identity verification form. Be truthful all of this info is used to verify your identity. This verification can take some time.
Once you’re verified you can deposit some money. You have 2 options you can link a bank and/or a credit/debit card. Both have their strengths and weaknesses.
Step 3: Configure Bank Accounts, Deposit and Buy
- Bank Account: Takes 1 full week for the funds to show up in your coinbase account and there are no fees. Limit is $10,000/week.
- Go to “Settings” then “Linked Accounts” then “Add Account”
- Add your bank account and/or your credit/debit card
- Once you’ve added your accounts select “Accounts” and you will see your 4 wallets.
- If you’re doing a bank transfer select “Deposit” under you USD wallet.
- Deposit your funds and wait 7 days until they show up.
- Once your funds have been transferred into your wallet, this is very important as you’ll save yourself a lot of money in fees, go to https://www.gdax.com/ and just click sign in. Gdax is owned by Coinbase so your CB account will work to log into Gdax.
- In the top right of your Gdax page select “Deposit”
- From this page you’re going to select “Coinbase Account” and then how much you want to transfer(hint: transfer all of it)
- Click Deposit Funds and now you have your money in GDax.
- Next you’re going to need to buy. I would recommend buying Ethereum as the transaction speed is the fastest of the 3 when you’re trying to transfer your Ethereum to an exchange(we’ll get to the exchange part later).
- In the top left of your screen next to where you see the GDax logo hover over BTC/USD and change it to ETH/USD
- Now you’re ready to buy Ethereum. You can get complicated and set a limit buy which means that you want to buy only at a specific price. As this is a beginners guide I recommend just buying at market price.
Congratulations you just bought your first Cryptocurrency!
- Credit/Debit Card: This is instant, but you have to buy a coin. On top of that the fees are pretty obnoxious, but if you want instant gratification and your FOMO is making you regret your life decisions use this option.
- In the previous step you should’ve already set up your credit/debit card. Now its time to buy. First step is to click on “BUY/SELL” then “BUY” should be selected by default. You’ll want to click on Ethereum as Bitcoin is the default. Choose the credit/debit card you want to buy with and hit “Buy Ethereum Instantly.” This will buy your Ether! I’ve highlighted where you can see the fee you will pay.
Binance is the exchange you will use to buy alt coins. For example if you want to buy Ripple you need to transfer your Ethereum that you bought on coinbase to Binance since they only accept cryptocurrency transfers. So lets get started.
Create an account
Go to the following website and create your account. https://www.binance.com In the top right hand corner of the screen click “Register”
- Enter your email and a password, agree to their terms and conditions(read them if you’re feeling frisky)
Next you’ll get a little screen with a slider where you have to slide over a missing piece of a puzzle. This is just to make sure you’re not a robot.
Now you’ll get an email to confirm your registration, click on the link in the email.
Now it’s going to ask you to log in, do so with your email and pwd.
This will take you to your account page where they will recommend you enable 2 factor authentication. I personally would recommend doing this. You’ll have to download the “Google Authenticator App” to your phone to use Google Auth. You can’t use the text message route, since that is only available in China, unless you’re in China. You’re probably not in China.
Download the app from either the google play store or the apple store.
Click the little plus to add a site
Click scan barcode and scan the barcode on your computer screen.
When it’s scanned it will say “Secret Saved”
Now enter your password on the left side and enter the 6 digit authentication code from your app.
Next you’ll be brought to your profile. You’ll notice that there is a little flag that says “USE BNB to save 50% on Transaction Fees” which is defaulted to yes. I’d recommend leaving that to save yourself some money, but there is some risk involved. It’s essentially converting your transaction to the Binance coin and then converting it back at the end of the transaction. The value of the binance coin is just as volatile as any other cryptocurrency, but you’re not here to play it safe so suck it up buttercup and keep this set to yes.
As long as you’re not planning on moving more than 2 bitcoins(currently about $35000 USD) worth of value a day you’re all set. If you’re a big a baller you need tier 2 authentication.
Transfer your Ether from GDax or Coinbase to Binance
You’re almost there, but not really. Now you need to transfer your Ether to binance. This is actually pretty easy.
Step 1: Find out your public wallet address
- Your public wallet address is just what it sounds like, anyone can see it and that’s how they would send crypto to you. Select “Funds” in the top right and click on “Deposits Withdrawals. This will bring you to your digital wallets in Binance.
- From in your digital wallet screen you’ll want to search for “ETH” in the little search bar. Then click “Deposit” on on the row that’s highlighted. MAKE SURE YOU CLICK THE RIGHT ONE. Since you’re sending Ethereum you need to send it to an Ethereum wallet. If you send it to the wrong wallet you could lose everything.
- Once you click deposit you should see your public Wallet Address. You’re going to want to copy this address as this is the address you’re going to send you Ethereum to from either Coinbase or Gdax. Look at you, now you know your public wallet address. Set this address aside for later. Seriously open up a notepad or something and copy and paste it in there or just leave this window open. (Notice how I'm completely willing to show all of you my public ETH address on Binance, if you want to send me some ETH feel free, I won't get mad)
Step 2: Transfer Ethereum from Coinbase or GDax
Now this is the nerve wracking part. Once you transfer your money it leaves coinbase and gdax and enters the blockchain. Sometimes during high traffic times your money will get stuck in coinbase or gdax while it’s waiting to be transferred to the ethereum blockchain. This can realistically take hours although I’ve had it happen in minutes. Ethereum is significantly faster to transfer than bitcoin.
To transfer from GDax to Binance you have to click “Withdraw,” which is right next to the deposit button you used to transfer the money from coinbase to gdax.
Next you want to select ETH Address and in the “Destination” field you need to put in your Binance Ethereum Wallet address which I asked you to set aside earlier.
Now go back to Binance, go to you Ethereum wallet and confirm that the address you put in matches the deposit address in Binance.
Select max in the amount of Ether you want to send.
Click send code and Coinbase will text you a 2fa code, or if you set up 2fa with google auth type the code in here.
Click withdraw funds
Now if you made a CC transaction you’ll need to transfer directly from coinbase to Binance.
- This is going to be pretty much identical to the above the only difference is to send the money you’re going to go “Accounts” and click send from “ETH Wallet”
- Now you should pour yourself a glass of whiskey to take the edge off. You could be waiting for a bit.
If you want you can go to the Binance “Funds” and “History” page sometimes your transaction will show up there before it shows up as being sent from GDax or Coinbase
- If you click “Check” on the transaction you it will take you Etherscan and you can track your transaction status. You need 30 block confirmations before your money will show up.
Buying alt coins
Ok so your Ethereum has showed up in your in Binance. Time to put the booze away and grab a cup of coffee, you need to sober up. Once you feel sober you should maybe wait another hour, you know since you’re probably not REALLY sober.
Let’s say you’ve decided you want to buy some Ripple, since everyone is talking about(which isn’t a good reason to buy, we’ll get to that later). This might seem complicated but it’s not that bad.
Step 1: Get to your market and find your coin
- Click on the Binance Icon in the top left hand corner of the screen and then about half way down click on “Eth Markets”. Highlighted in yellow.
- Next to the little hourglass type in the coin you want to purchase. In this case it’s Ripple which XRP and click on the XRP/ETH pair
Now this page looks kind of daunting, but really it’s not that bad. On the right hand side you have the ETH market which lets you switch to a different pair if you want. Below that is the trade history for XRP, you can see the completed ripple transactions. On the left hand side you have limit buy and sell orders. The limit Sell orders are in Red and the buy orders are below them in green. This is just telling you that there are other people other there trying to buy or sell and what’s listed is how much they’re willing to buy or sell each ripple for.
So now you have to make the decision to buy ripple. You have 3 options “Market”, “Limit” and “Stop Limit.”
A market buy is just that, you enter how many Ripple you want and it will buy that many at the market price. The best part about this is it usually happens pretty quickly.
The limit buy is similar, but you set the price. So you’re basically saying “I’m only willing to spend X amount of my ETH per rippler, regardless of the market”
The Stop limit is basically the same as the limit. The difference is you can say “I’ll pay up to X amount”
Now just click buy XRP and you’ve just bought your second Cryptocurrency.
What coins do I buy
Now you’re probably asking yourself “How the hell do I decide what to buy? Parag told me above that I shouldn’t just buy it because everyone is talking about it.” You’re damn right he did. You need to do some research, otherwise you’re trusting in what somebody else says. What you need to do is go to https://coinmarketcap.com/ and start doing research. Start with the top 100 coins in market cap. Click on a coin and then, in our case Ripple, look at the website. Look at the announcements, find the whitepapers. Look at the team behind the project, do they have a history in the blockchain world? Are they legit business people? See if the project has any partnerships. Find everything you can and invest in projects that you believe in. I’m going to reiterate ONLY INVEST AS MUCH AS YOU CAN AFFORD TO LOSE! If you can’t live without that money then don’t invest it.
What do I do with my coins
This is where things get complicated. You DO NOT want to store your coins in your exchange wallets. If you want to know why just google “Mt Gox” and “NiceHash” these exchanges can be hacked. Ideally you want cold storage. A piece of hardware that’s only connected to the web when you’re connecting it to a computer. This is the most secure way to store your alt coins. I personally have a Ledger Nano S for my wallet. There are a ton of wallets out there that are available. Some are web wallets, some are downloadable wallets, but very few of them will support every coin. For instance I have about 5 different wallets configured with my Nano. There is plenty of info about wallets available on the web so do your research.
Conclusion
That’s all folks, good luck with your cryptoventure and if you need a good cryptolio to monitor how your investments are doing I highly recommend the Delta portfolio app. By the way ONLY INVEST AS MUCH AS YOU CAN AFFORD TO LOSE BECAUSE YOU CAN LOSE IT ALL IN A HEARTBEAT!!!!!!!!!!!!!!!!!!
Thanks for reading,
Parag Shah
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This was a very good writeup. I wish I had found it before I jumped into crypto. :) It would be good to add info about the exchanges, and which ones are reputable (or not). Also, informing noobs about how to find the exchanges for particular coins would be a good tip (i.e. Markets tab on coinmarketcap.com)
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