Cryptocurrencies have been making headlines for more than 3 years now. Despite this notorious fame, there are still people who don’t know how to pay with cryptocurrencies, which requires OWNING them first. In this article, we’re going to break down in an easy step by step guide how to pay with cryptocurrencies, and specifically, we’ll take the example of Litecoin as a cryptocurrency to be used.
A Tutorial for paying/receiving Litecoins through Coinbase
What are cryptocurrencies?
Cryptocurrencies are virtual currencies based on blockchain technology. While normal payment systems are centralized (such as banks or PayPal), cryptocurrencies are decentralized and use a secure peer-to-peer network that enables permanent recording of all transactions made. Bitcoin was developed in 2009 and is the first cryptocurrency. Almost ten years later, cryptocurrencies are used by millions of people, companies, and states to transfer values, goods, and services.
Why pay with cryptocurrencies?
Paying with cryptocurrencies is a simple and inexpensive alternative to SWIFT and PayPal. More and more companies are choosing cryptocurrencies to be more flexible, faster, and more independent.
The use of cryptocurrencies has several advantages, such as….
- Low transaction fees: Transaction fees are usually under 1%, while banks or PayPal charge up to 4-5% per transaction in addition to the exchange fees.
- Immediate transactions: The transfer takes minutes (even internationally) and not days, which makes cash flow management and the running of a company easier.
- Security: All cryptocurrency transactions are secure, encrypted, and traceable.
- Long-term growth: The value of cryptocurrencies is currently increasing exponentially.
Although there are multiple cryptocurrencies and exchanges, one of the easiest ways to pay with cryptocurrencies is Litecoin and the exchange Coinbase.
- Litecoin is a cryptocurrency with a fast transfer time (under 3 minutes)
- Coinbase is an easy-to-use and established online platform for buying and storing cryptocurrencies.
You can then use this process to send money to friends or receive your own payments. The procedure can be used for any other cryptocurrency that is offered on Coinbase.
How can I pay with Litecoin through Coinbase?
Step 1: Create your Coinbase account
Go to www.coinbase.com and create an account.
Step 2: Buy Litecoin
First, you have to purchase Litecoin before you can pay with it.
- Click on “Buy / Sell”
- Add a payment method (if you haven’t already done so)
- Click to buy Litecoin
- Enter the amount you want to buy – on the right side you can see how much Litecoin you will receive and what fees will apply for the purchase.
Important: Make sure to buy a little more than you need to pay the fees as well.
- Purchase Litecoin – the amount is then immediately transferred to your Litecoin wallet.
Step 3: Sending Litecoin
Now that you have Litecoin, you can transfer it to an account.
- Click on “Accounts”
- Click on “LTC Wallet” – your Litecoin wallet
- Click on “Send”
- Enter the recipient address
- IMPORTANT: Always double-check whether the address entered is the correct one (!)
- Enter the amount you want to transfer – it will be displayed in both Euros and Litecoin
- Optional: send a note with the transaction
- Click on Continue and end the transaction
Done – you have just paid with crypto for the first time!
How do I receive/get paid Litecoins through Coinbase?
Step 1: Share your wallet address
- Go to “Accounts”
- Click on “LTC Wallet”
- Click on “Receive”
- Copy and share your address
The sender will then have to follow the steps above and send you Litecoin to this address.
Step 2: Exchange your Litecoin for euros
Once you have received the Litecoin amount, you can keep it as Litecoins or convert it to euros.
- Go to “Buy / Sell”
- Click on “Sell” and choose your LTC wallet
- Enter the amount of Litecoin you want to convert to Euros.
- Sell your Litecoin
You now have euros in your euro wallet under “Accounts”.
Step 3: Transfer your euro balance to your bank.
If you want to withdraw your Euros from Coinbase and transfer it to your bank account, just follow the steps below. The transaction time is ~ 24h.
- Go to “Accounts”
- Click on “EUR Wallet”
- Click on “Withdraw”
- Add a bank account (if you haven’t already)
- Transfer the money to your bank account
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