Coinbase Binance Dance. Guide to Purchasing Altcoins.
#Coinbase Binance Dance. Guide to purchasing altcoins.
The Coinbase Binance dance is a multi-step process used to purchase altcoins. (An altcoin is any cryptocurrency that is not Bitcoin). Reddit in particular is very fond of this method as it is commonly recommended to newcomers.
**How it works:** You purchase Ethereum using Coinbase, send that Ethereum to your Binance account, then execute a trade selling said Ethereum for your cryptocurrency of choice.
This is a process that seems very tedious and a bit complicated to crypto-newbies. No need to worry, I’m going to walk you through the process with photos included for visual aid.
Using this method, you can purchase various types of cryptocurrencies including:
Etc… the list goes on. So long as it’s listed on Binance, you will be able to trade for the coin.
##**Accounts to sign up for**
Both Coinbase and Binance are cryptocurrency exchanges you must sign up for in order to do this method.
I recommend you create these accounts sooner rather than later as it can take a few days to get fully verified (especially for Coinbase).
If you’re having issues, or questions, or would just like more information, I have full detailed tutorials regarding both Coinbase & Binance.
* [Coinbase Tutorial. A Definitive Guide for Newcomers](https://www.reddit.com/r/CoinBase/comments/8deqla/coinbase_tutorial_a_definitive_guide_for_newcomers/)
* [Beginners Guide to Binance. How to Exchange Cryptocurrency.](https://www.reddit.com/r/BinanceExchange/comments/8k50dh/beginners_guide_to_binance_how_to_exchange/)
##I have created these accounts. What do I do now?
Awesome! You’ve got the accounts created, now it’s time to do the dance. For the sake of this tutorial I’ll be purchasing the cryptocurrency XRP. Remember, this method works with any cryptocurrency so long as it’s listed on Binance.
* **Step 1:** Make sure your token can be purchased with Ethereum. Go to Binance's home page and select `ETH Markets` use the search bar to look for your tokens ticker. [See photo](https://i.imgur.com/k0h0wwo.png).
If your token does not appear, check BTC Markets. If you see it there, you'll need to buy BTC and send it to Binance instead of ETH.
* **Step 2:** Purchase Ethereum using Coinbase. [See photo](https://i.imgur.com/COKiihy.png).
For the lowest possible fee in Coinbase, [link your bank account](https://i.imgur.com/HGy4MGJ.png). Purchases are still instantaneous, it will take 5-7 business days for the charge to appear in your account. [See photo](https://i.imgur.com/KQLHQnk.png).
* **Step 3:** Send your Ethereum from Coinbase to your Binance Ethereum wallet address. [See photo](https://i.imgur.com/ClvqREz.png).
*Optional: Depending on your location, you may or may not have to pay a Coinbase transfer fee. If you see that you do and would rather not, you can mitigate this fee by sending your crypto to Coinbase Pro or GDAX then to Binance. If this otherwise does not concern you, please continue below.*
To find your Binance Ethereum wallet address, go to: `Funds` > `Deposits` > `ETH - Ethereum` and click `Copy Address`. [See photo](https://i.imgur.com/LEEZGoV.png).
Once you click confirm, you’ll be asked to complete 2-step verification provided by your phone. [See photo](https://i.imgur.com/XXvNnUV.png).
You can view the transaction in Coinbase. After a few minutes you’ll see confirmations coming through. Refresh the Binance deposits page as well and you’ll see confirmations. [See photo](https://i.imgur.com/MqW2nwj.png).
You’ll get two emails during this process. One from Coinbase, another from Binance. Cryptocurrency transactions are not instantaneous on the Ethereum blockchain. In this case it took ~6 minutes for this transfer to complete, however this may vary depending on how congested the network is. During high periods of high traffic on the Ethereum blockchain, you can expect it to take longer than 6 minutes so don’t worry if it’s taking longer. As long as you’re seeing confirmation, you should be good. [See photo](https://i.imgur.com/ZlyhW1g.png).
Once you receive the `Deposit Success Alerts` email from Binance, go to `Funds` > `Balances` in Binance. You’ll see that you’re Ethereum balance has increased. [See photo](https://i.imgur.com/peK9GgX.png).
* **Step 4:** In Binance, go to `Exchange` > `Basic`. You’ll be met with a screen that looks like this. [See photo](https://i.imgur.com/QKy8zDO.png).
I know this screen looks a bit confusing. It’s really not. First thing we need to do is make sure Ethereum (ETH) is set as our baseline currency for trade.
* **Step 5:** Set Ethereum as baseline currency. [See photo](https://i.imgur.com/zUosDSu.png).
You can see in that photo what is shown is all the possible cryptocurrencies pairings available with Ethereum.
* **Step 6:** Use the search bar to search for the token’s ticker you’d like to purchase. [See photo](https://i.imgur.com/l6jMPcc.png).
In the case for Ripple, the ticker is XRP. If you don’t know your coins ticker, Google it.
* **Step 7:** Set your prefered parameters and click `Buy`. [See photo](https://i.imgur.com/dZhZCnl.png).
The `25%` `50%` `75%` and `100%` buttons refer to how much of your set baseline funds you would like to dedicate towards your purchase. In my case, by clicking `100%` I am saying I’d like to use 100% of my Ethereum funds to purchase XRP. Clicking `75%` would be 75% of my ETH funds etc…
The `Amount` and `Totals` sections are automatically filled out based off your % choice.
* **Step 7:** Wait for your order to be filled!
Depending on the market, your order may be filled right away or not. If you’re getting impatient you can always cancel the order and try again at a slightly higher price. If you’re going to edit the [price per coin section](https://i.imgur.com/4a27Qjx.png), just be sure you don’t accidentally end up paying a ridiculously high amount.
If you click into the `price` field a blurb will appear showing you how much you’re paying per coin. [See photo](https://i.imgur.com/lB9SvFH.png).
Congratulations! You’ve just done the Coinbase Binanace dance. Wasn’t so hard was it? Once your order has been completely filled, the `Funds` > `Balances` page should reflect your purchase. [See photo](https://i.imgur.com/0F99hD6.png).
###Lower Fees using BNB
It helps to purchase a little bit of Binance native token `BNB` to help save on fees. Make sure you enable it in your account settings! [See photo](https://i.imgur.com/ru6tBOO.png).
You can purchase BNB using the same method described above.
###Selling your crypto.
Selling your crypto is a very similar process. In my instance with my XRP, if I wanted to sell that back to USD. I’d need to sell the XRP for Ethereum, then sell that Ethereum for USD on Coinbase.
**The process would look something like this:**
* Sell my XRP for Ethereum in Binance
* Withdrawal the Ethereum from Binance to Coinbase
* Sell the Ethereum for USD through Coinbase.
If you consider yourself a hodler, and do not plan to actively be making trades, I highly recommend you send your crypto to a hardware wallet such as the Ledger Nano S. Hardware wallets are a form of cold storage and are the safest way to store cryptocurrency.
It is highly recommended you DO NOT store crypto on any exchange as exchanges themselves are prone to hacks (see [Mt. Gox hack](https://en.wikipedia.org/wiki/Mt._Gox)).
I also highly recommend you secure your Binance and Coinbase accounts with 2-factor authentication (2FA) and google authenticator to reduce the risk of a hack.
In the end, be glad that you learned how to do this process! Figuring out how to actually purchase cryptocurrency is one of the most challenging things for newbies, and now that you have a Coinbase and Binance account setup, you have the ability to purchase 95% of coins.
If you have any questions feel free to comment down below or send me a message. I’d be happy to help!
##Frequently Asked Questions
***Why not use Bitcoin to send to Binance. Why use Ethereum?***
- Transactions on the Ethereum blockchain are faster than Bitcoin's. Ethereum has a block time of ~15s, Bitcoin has a block time of ~10min. This means on average, Ethereum transactions will be faster than Bitcoins. Fees are also lower on the Ethereum blockchain so I consider Ethereum to be a much better bridge currency in the use of purchasing altcoins.
You could also use Litecoin if you wanted to. Litecoin has a smaller block time (2m 34s) compared to Bitcoin and the fees are much lower.
To see block time data on blockchains, [BitInfoCharts](https://bitinfocharts.com) is a very good resource.
- [Beginners Guide to Bitcoin, Blockchain & Cryptocurrency](https://www.reddit.com/r/Bitcoin/comments/8i71cl/a_beginners_guide_to_bitcoin_blockchain/)
- [Coinbase Tutorial. A Definitive Guide for Newcomers](https://www.reddit.com/r/CoinBase/comments/8deqla/coinbase_tutorial_a_definitive_guide_for_newcomers/)
- [Beginners Guide to Binance. How to Exchange Cryptocurrency.](https://www.reddit.com/r/BinanceExchange/comments/8k50dh/beginners_guide_to_binance_how_to_exchange/)