If you are reading this, you are likely interested in getting into the world of cryptocurrencies. I will do my part in sharing the mantra: Do not invest more than you can afford to lose. Please don't bet your life savings on this insanely volatile market. I also take no responsibility if you do end up losing what you put in.
But let's cut it to the chase and get you buying some Altcoins!
There are many sites out there that let you purchase Bitcoin and Altcoins. We are going to focus on three that will get you most of what you want.
Disclaimer: The links to the sites below and in the rest of the post use my referral link. I hope that by sharing this knowledge, you sign up using my link so that I may receive kickbacks from these services. Thanks!
- Coinbase - A US based service for buying the "big" cryptocurrencies, and probably the easiest with which to get started.
- GDAX - Coinbase's proprietary exchange. Once you sign up for Coinbase, you will also have a GDAX account, which will be the same as your Coinbase account. We will use this to avoid transaction fees later.
- Binance - A cryptocurrency exchange that offers many more coins than what Coinbase offers.
The flow will look something like this:
Buy ETH on Coinbase -> Transfer ETH to GDAX -> Transfer ETH to Binance -> Purchase Altcoins using your ETH on Binance
I will explain in detail why the multi transfer process is necessary, but the TL;DR is that you save on fees by transferring from Coinbase to GDAX to Binance, as opposed to Coinbase to GDAX directly.
So let's go through all this step by step.
Step 1 - Sign up for Coinbase
Make an account with Coinbase. Follow their guide for linking either your Bank Account or your Debit Card
Note: Purchasing via your Bank Account takes 7 days for the coins you purchased to be accessible in your account at a lower transaction fee, whereas purchasing via your Debit Card allows your coins to be accessible immediately, but at a higher transaction fee
Let's assume you want your coins immediately, so choose the Debit Card option if that's available to you.
Step 2 - Buy Ethereum (ETH)
Why Ethereum? The point of this blog is to get you buying Altcoins. As of this writing, Ethereum is cheaper to transact with than Bitcoin, and also faster at moving between GDAX and Binance than Bitcoin. Additionally, most Altcoins on Binance have an Ethereum pair (meaning, you can directly buy an Altcoin with Ethereum). For these reasons, I prefer using Ethereum as my main Coin with which to purchase Altcoins on Binance.
So, in your Coinbase account, buy some Ethereum. Let's say, somewhere between $25-$50. If you want it instantly, use your Debit Card.
If successful, you should see whatever amount of Ethereum you purchased under the Accounts tab on Coinbase, at the top.
Step 3 - Login to GDAX
Again, GDAX is Coinbase's exchange, which is built for the more "hardcore" trader. GDAX offers fee-less transactions when you send in and out, while Coinbase's main app incurs a transaction fee. Therefore, we are using GDAX simply to save you some money by side-stepping the transaction fee on Coinbase.
So go to GDAX and log in (top right of the screen) with your Coinbase credentials.
Once logged in, Go to your accounts, which is a list of your coin holdings (BTC, LTC, ETH, BCH), by hovering over this icon in the top right and clicking Accounts (kind of an awkward interaction)
You'll then see your accounts on the left hand side.
Step 4 - Deposit your ETH from Coinbase to GDAX
Okay, here's where you do your first move! You should see your "Ethereum" account on the left side. Click on the down arrow which is for deposits:
When you click the down arrow, this screen will pop up. Choose your Coinbase account from the Source dropdown and type in the amount you want to transfer to GDAX (assuming you want to transfer all of it)
This part is kind of annoying because it makes you manually type in the Ethereum amount which is often a long floating point number so just be aware that its a manual process. So type in the "available amount" that is displayed and then hit deposit funds (mine says 0 Eth in the below screenshot, I'll update that later so it displays some amount)
Your ETH will be immediately available in your GDAX account. Yay!
Step 5 - Deposit ETH from GDAX to your Binance Ethereum Address
We're almost there - now we want to send our ETH to Binance so we can actually use it to purchase Altcoins.
If you haven't yet, Sign Up for Binance and log in
Once logged in, hover over Funds in the top right, and select Deposits
On the Deposits screen, search for ETH
Click the ETH - Ethereum search result option, and you will find your Ethereum Address that was generated for you by Binance. This address is what you will use to send Ethereum Only from Coinbase. Do not send Bitcoin, Litecoin, or Bitcoin Cash to your Ethereum address, as those are completely different coins with their own addresses!
Copy your Ethereum address to your clipboard (there is a copy address button), and head on back to GDAX
Switch Back to GDAX
Back in GDAX, go back to your Accounts view (highlighted in Step 4)
Now click the Up Arrow on your Ethereum account, this is for Withdrawals. You will be withdrawing your ETH from GDAX to Binance!
On the screen the pops up, click ETH Address
In the amount, type the amount you want to send (or hit the grey MAX button), and in destination, paste your exact Binance Ethereum address, and double check its the same as what you see on Binance's site!
Then hit Withdraw funds (if you have 2FA enabled, enter the code there)
It's going to take anywhere from 5-30 minutes to transfer Ethereum to Binance. Do not panic. If you double and even triple checked the address, you should be just fine. You can check the status by copying the transaction ID coinbase gives you into etherscan.io or by going to Funds -> Deposits in Binance
Once it has successfully deposited in Binance, you can start trading your Ethereum for any of the Altcoins they offer. Here's just an example of what that looks like.
Step 6 - Go to the Exchange View on Binance
Hover over Exchange and click Basic on Binance
Step 7 - Choose ETH as your Trading Currency
You can trade using BTC, ETH, BNB, and USDT. Since you hold ETH, choose ETH as your trading pair.
Step 9. Search for a coin in the search icon under the ETH button
Once it's selected, the charts and graphs will update to reflect the trading history of that coin in ETH
Step 10. Put in a BUY order
Here's where its up to you. I chose VEN in this example. But basically, choose the amount of ETH you wish to use to buy your coin (or type in an exact amount), and adjust the price you want to pay (or pay the market price), and you'll see your order appear in the green Buy book on the left side
And that about does it! Now you know how to trade your ETH for Altcoins on Binance, using Coinbase and GDAX as the entry point.