Lesson Summary 009
Sending cryptocurrency can be complex as the process differs depending on how you store your cryptocurrency. It is important you follow each step correctly to ensure your cryptocurrency goes from point A to B securely.
Below is a general outline as to how to send your cryptocurrency.
- You send cryptocurrency to a public blockchain address.
- If you want to receive cryptocurrency, you must provide the sender with your public address.
- You interface with a wallet to access the private keys which enable you to send your cryptocurrency between addresses, incurring a small fee for sending.
- Transactions are processed and confirmed on the blockchain.
To send or receive cryptocurrency, through your wallet you can either manually insert addresses or use QR codes.
You’re charged transaction fees whenever you send cryptocurrency from one blockchain address to another. Fees vary depending on (i) the blockchain being used, (ii) network activity and (iii) personal preference.
Exchanges typically charge a blend of deposit fees, transaction fees, withdrawal fees and conversion fees.
Gas is unique to Ethereum and some select blockchains. It is required for all transactions and is similar to transaction fees on Bitcoin.
Network congestion occurs when the network becomes busier thereby crowding the mempool. Transactions may take longer to process during peak times. Paying a higher transaction fee can speed up wait times. Your transaction will take longer to process when you choose to pay a lower transaction fee.
Block explorers let you search and track transactions, using a block explorer is a must. The moment a transaction is generated, it’s given a transaction ID (TXID). You can find transaction details on a block explorer by copying and pasting the relevant TXID from the app or program you sent the transaction from.
There are several risks associated with sending cryptocurrency. Among these are clipboard hijackers, irreversibility, phishing and key-logging monitors.
Below are some tips for sending cryptocurrency:
- Verify the recipient’s address
- Use the copy feature
- Send a small test amount for new addresses
- Ensure your connection is secure
- Only use trusted platforms