How to Buy Your First Altcoin
1. Set Up a Crypto Trading Account
A crypto account is a place to buy crypto currencies. I did this using a platform called Coinbase. Other popular options include Gemini and Binance. I’m not partial to any, I just picked the lowest barrier to entry, and that was Coinbase.
Think of this like setting up a bank account. I had to do the standard stuff like add my personal info, drivers license, etc.
The process is pretty self explanatory. The biggest thing here is connecting to another financial institution. That can take a long time, so be patient.
2. Set Up a Crypto Wallet
Coinbase, or any other crypto trading account, has limited capabilities for what you can and can’t buy. I can’t get in on new projects with Coinbase — I can only trade major coins like Bitcoin, Ethereum, and Avalanche.
So what do I do if I want to buy and sell newer, smaller coins?
I have to set up a wallet.
I use a wallet called MetaMask that’s exists as a plugin on my browser.
How did I set it up?
1. I downloaded the MetaMask plugin and added it to Chrome.
2. I set up my MetaMask account and made a hella complex password.
3. I got my seed phrase. This is important. This is a series of words I use to recover my account if I ever forget my password. If you lose your password + lose your seed phrase, you lose your money.
I keep my seed phrase somewhere secret.
Now that I have my wallet, I can buy obscure coins from something called a decentralized exchange.
What Is a Decentralized Exchange?
Think about it like this:
My Coinbase account is like the bank. That’s where I deposit fiat currency (such as US dollars) and use that to buy my first major crypto (such as Bitcoin, Etherium, and Avalanche).
My MetaMask wallet is like, well, a wallet. I go to the Coinbase bank, take my money out, and put it in my MetaMask wallet.
Then, once I have that money in my wallet, I can then go to a decentralized exchange, which is like an open marketplace, and make purchases.
Now, in an open marketplace, anything is possible.
Maybe I find a great deal. Maybe I get swindled. Who knows. It’s the wild west out here, so you have to be careful. (More on Decentralized exchanges in a minute.)
3. Add Avalanche to MetaMask
Before I can send a crypto anywhere, I need a crypto to send. I start by purchasing an asset on Coinbase.
Make the Trade
The first transaction you make on your crypto trading account will take several days to process. Don’t worry. After that it’s much quicker.
Set Up the Right Network
Then I have to add the right network to my MetaMask wallet. Different cryptocurrencies exist on different blockchains (or networks, as MetaMask calls them). By default, MetaMask will assume your transactions all exist on Ethereum.
That’s fine if you like Ethereum. I don’t. I use Avalanche. Which means I need to manually add Avalanche to my wallet.
Think of it like getting a different credit card for your wallet. Some people are loyal to MasterCard, and that’s fine. It can be used a lot of places. But I like American Express. The rewards are better, even if it’s not accepted as many places.
But I don’t automatically get an American Express card when I get a wallet. I have to go through some steps.
All this goes out the window if you’re keen to use the Ned Flanders network.
There’s a really straightforward tutorial on how to add another “network” to your MetaMask wallet here: https://support.avax.network/en/articles/4626956-how-do-i-set-up-metamask-on-avalanche
4. Buy and Send from Coinbase to MetaMask
Now that I’ve added my network of preference to my wallet, it’s time to go to the bank and get some money.
1. I go back to Coinbase.
2. I click on my new asset in Coinbase.
3. I click the little “send” arrow.
4. It will then ask me how much I want to send and what address I want to send it to.
What is a Wallet Address?
A crypto wallet address is a series of numbers and letters that leads to your wallet. Every wallet has a unique address, but your address is not a secret. I share my address with friends so we can trade crypto and NFTs all the time.
I wouldn’t go blasting it on Twitter or anything like that, any more than I’d share my home address on Twitter.
Not for any real significant reasons. The only thing someone can do with my address is see what my wallet holds. They can’t take it, though. They’d need my private keys to do that (a whole other story).
5. I go to my MetaMask and copy my wallet address.
Alternatively, if I’m sending money from my mobile Coinbase and desktop MetaMask, I can use my phone to scan the QR code version of my address on MetaMask.
The first time I did this, I started with a tiny amount of crypto. Just to practice. In case I somehow tried sending to the wrong address or something wonky like that.
Only after I felt comfortable sending small amounts did I crank up to bigger amounts.
Once the crypto is sent to my MetaMask, it shows up almost immediately.
Now things get interesting. I have money in my wallet, and I can invest it in all types of crazy shit on something called a decentralized exchange.
5. Connect My Wallet to a Decentralized Exchanged
A decentralized exchange (or DEX) is a great place to lose all of your money if you don’t know what you’re doing.
A DEX is also a great place to invest in new projects.
For ease, let’s focus on one DEX: Trader Joe.
Trader Joe is a DEX (or marketplace) for coins that exist on the Avalanche (AVAX) blockchain.
I like it because the user interface is really smooth and easy to use. They offer a ton of cool rewards to users. And they’re really involved in the AVAX community.
If I want to do any trading on a DEX, I need to connect my wallet.
A NOTE ON CONNECTING A WALLET
I only connect my wallet to sites I trust. Connecting my wallet to a bunch of different sites is asking for trouble. I regularly go back and disconnect my wallet from old sites just to keep myself safe.
1. I click the “Connect Wallet” button in the top right corner.
2. A popup will come up asking me to sign the contract. I accept.
3. Now that my wallet is connected to the Trader Joe DEX, I can start trading.
4. I click on the “Trade” tab.
5. For the top coin, I enter in the amount of AVAX I want to trade. I can’t choose all of it, because I need a little bit leftover for transaction fees [AKA gas].
6. Then, on the bottom, I’ll choose the coin I want to trade to.
7. I click “Swap” then the transaction will be pending for a few moments.
8. If the trade was successful, a popup will appear confirming that I’ve purchased my first altcoins on a Decentralized Exchange!
This is all personal narrative, not financial advice.
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Thanks for reading!
Greg “The Crypto Kid” Larson