Crypto Exchanges 101 - How to buy with USD/Bank Accounts/Credit Cards, Alt Coins, and Cashing Out

Exchanges:

Most of you on Steemit, will be familiar with how to buy and sell your crypto, but for you noobies on Steemit, this will be a quick tutorial for how you can cash out some of your Steem Backed Dollars in the future as well as how you can buy some Steem.

Buying Bitcoin sounds very confusing and scary. It's even worse when you tell someone they can buy Ethereum just as easily as Bitcoin. Here's a 101 on how to use your US Dollars/local currency to buy Bitcoin/Ethereum. Remember to do your own research and confirm everything said here. The crypto space is very very wild wild west-ish and there are tons of scammers out there.

In our modern day and age, the USD is king. Most countries take USD or allow you to convert USD into local currency. It's also known as the global reserve currency. Bitcoin is similar in this aspect as Bitcoin is king in the crypto currency space. Almost all 800+ crypto currencies are traded in terms of BTC. Ethereum is roughly 10 to 1 BTC. LTC is roughly 60 to 1 BTC. Other coins are fractions of a BTC. A majority of the alternative coins (Alt coins) require you to buy them via BTC. You can't buy them in USD or any other local currency you use to transact on a daily basis. They most likely take BTC only or ETH.

Well that makes it confusing if you don't even know how to buy BTC/ETH, how are you supposed to buy any of those ALT Coins that are going bonkers and returning 5x, 10x, 20x+?

First Step (USD Exchanges)

There are a handful of USD exchanges that allow you to use your USD's and buy BTC/ETH. Below are 3 somewhat trust worthy exchanges that have a decent amount of adoption within the crypto space. If you'd like to get started in crypto currency investing or trading, you can register with any or one of the exchanges (I have registered with all). They each normally have a Know Your Customer (KYC) policy that requires multiple buys over time to really verify you aren't a scammer, using stolen cards, etc in order to increase buying limits. Initially your buy limits might be lower than you'd like, but if you go through the verification process or make consistent buys over time, your limits will increase. You can link your bank account and credit cards to these exchanges. Uploading your ID's allow unlocking of higher buying limits and selling limits. Once your accounts are setup, you can purchase your BTC or ETH's on these exchanges. I personally like Coinbase and Gemini. I'm still waiting on Kraken to increase my buy limit for over a month now! Coinbase customer service is known to be bad, but they have the best user interface which makes it very easy to understand how to buy. They also have a mobile phone app as well. Remember, buying and selling does not have to be in full solid number amounts. You can buy 0.23 BTC or 2.38 ETH. You can also sell in fractional amounts as well so buy what you are comfortable with.

Coinbase
https://www.coinbase.com/

Gemini
https://gemini.com/

Kraken
https://www.kraken.com/

Second Step (Crypto only exchanges)

Now that you have your BTC and ETH, you want to play with the big boys and trade or invest in Alt Coins. If you read my previous wallet post, and have downloaded your wallet, you should be familiar with sending your coins off exchanges. You will need to do a similar thing but instead of sending it to a wallet for storage, you will be sending your BTC or ETH to an exchange to buy and sell other Alt Coins/Crypto currency. There are many many exchanges, so I will not list them all, I will just focus on the most popular ones. You must first sign-up and create an account on these exchanges, like you did with the USD exchanges. Once your account is created, you'll need to go to the wallet pages, and find your BTC wallet or ETH wallet on the exchange. Once you find the wallet address for your BTC or ETH, you'll want to send a test amount to the wallet. BTC transactions take a bit longer FYI. Once you have confirmed that the exchange has received your BTC and ETH and they are showing up in your wallet, you can now go to buy other currencies/alt coins. Remember, the alt coins are generally traded in terms of BTC or ETH, most of the time the value of BTC and ETH will be far greater than the alt coins on a 1:1 basis so you'll always see coins valued in fractions of BTC or ETH. 1 ETH could be work 0.0055 of XYZ coin.

Poloniex
https://poloniex.com

Bittrex
https://bittrex.com/

Third Step (How to exchange your Alt Coins back into Cash)

Now that you've bought a few alt coins, and hopefully made some profit by selling them and getting back more BTC or ETH than what you originally bought in for, how do you actually cash out. Just do the reverse of what you did you buy those coins. Sell your alt coins back for BTC/ETH. Once the BTC/ETH gets back into the crypto exchange respective wallets, you'll want to send your BTC/ETH from crypto exchange back to USD exchange. Look for your Coinbase/Gemini/Kraken BTC or ETH wallet address. Once again, send a small test amount to confirm it is the correct amount. Once that test amount is received, send the rest. Once you receive the full amount of BTC and ETH that you want to sell, sell them back to USD on the USD exchanges. Deposit the USD (if this step is necessary) back into your bank account and now you've made money from investing/trading in alt coins!