My second step in Bitcoin BCH: Playing with real money
A friend has recommended Coinbase as an app that I could use to exchange real money (sorry, fiat money, as it’s called in the crypto world) into Bitcoin Cash (BCH)—which is the cryptocurrency that CoinGeek recommends.
I download Coinbase. It looks like this, and at the bottom of the screen, invites me to Sign Up.
Coinbase is a crypto exchange. So what’s the difference between an exchange and a wallet? Well, an exchange is like a bank, where you can buy and sell different currencies, whether crypto or fiat. You can keep money in an exchange, but a wallet is the easiest place from which to use crypto, whether for buying, transferring to someone else, or receiving someone else’s payment to you.
It’s like the difference between a bank and your physical wallet: you can keep money in both but for day to day spending, you use your wallet, not the bank.
Signing up to Coinbase is quite a faff. So much so that I transfer from my phone to the Coinbase website and do it on my laptop. As well as the usual passwords and personal details, you have to upload a couple of documents—passport, utility bill or credit card—and then they take a while to process them.
But a few minutes later Coinbase tells me we are in business:
To convert some money to BCH, just as with any other kind of currency exchange, I have to transfer of funds to Coinbase. Here are the choices of where my money can be sent from:
Although Coinbase recommends that I link up my bank account, I’m still taking baby steps, and so I choose to pay with a credit card. Not all cards will allow you to transfer into a crypto exchange, but I have one that does and so I enter its details, just like for any online purchase. Now I’m ready to buy some BCH. I start by entering $10:
But then I spot that the Coinbase fee is about 10 per cent, so I go crazy and double my investment to $20, where the fee comes down to a still substantial 7.5 per cent. Here’s the deal:
Somehow my dollar investment has been turned into pounds, but never mind: I press Buy now.
But there’s a problem: the price of BCH is so volatile that the exchange rate has changed even while I’m taking the above screenshot—and the deal is off:
I try again, more quickly this time. The deal is marginally better for me than the one Coinbase rejected. I take a look at the changing price of BCH. It’s fallen against the dollar in the past few minutes, which is why I’ve been able to get a very slightly better rate:
So now Coinbase is telling me that I’m the proud owner of some BCH. It cost me $26.30 and a couple of hours later, it’s worth $23.90 (but that includes the $1.50 fee to Coinbase). I can track its changing value on the site:
But, hey, I’m not here to speculate on currency price movements. I’m here to get money into my wallet. I need a strong cup of tea, so that’s for next time.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as SegWitCoin BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins. Altcoins, which value privacy, anonymity, and distance from government intervention, are referenced as dark coins.
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