Chapter 9:
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One more thing to take a bird’s eye view before you move on to buying and selling on an exchange for real. If you have already made a trade, congratulations, if not it doesn’t matter. So, let’s see how we might withdraw some crypto to a wallet.
Contents
Withdrawing crypto
As with trading crypto, it varies slightly from exchange to exchange, wallet to wallet, and blockchain to blockchain. This generic tutorial will step through the fundamentals to stand you in good stead to interpret the UI of your chosen exchange, crypto, and wallet.
We have already experienced sending crypto between wallets. For example, when we purchased some BTC, we received some from the Exodus-recommended seller, and we then proceeded to send some BTC between our Exodus and Muun wallets. Sending crypto isn’t hard, but when dealing with an exchange that caters to thousands of tokens and dozens of networks, there is more scope for things to go wrong. Just for variety, I will show you how to withdraw non-bitcoin crypto, but the preamble followed by the step-by-step tutorial with screenshots will make it plain how to withdraw bitcoin (the focus of the book) or any other crypto in the future.
Let’s step through how to do it. First, I will show you some screenshots from Binance, but then I’ll also give you a heads-up on what to expect on other exchanges.
Before we can start, we must decide where we will send the crypto. I will use the Exodus wallet again because it caters to many blockchains, is entirely self-custody, and most readers likely already have it installed. But you could purchase BTC and send it to your Muun wallet if you prefer. Muun wallet is just for BTC so the altcoin we will introduce in this chapter can’t be sent to Muun.
If you start the Exodus app, there are multiple paths to prepare to receive crypto tokens. On the Portfolio tab, you will see a list of tokens, which can be clicked to go to the send and receive functionality. If you can’t see the token you want, scroll to the bottom of the page, and click the Add More button to choose from the complete list of tokens Exodus supports. Or you can click on the Wallet tab to see a list of tokens in a ticker-tape arrangement across the top of the screen. Again, if you can’t see the token you want, scroll the ticker tape to the left and click the Add More button.
As an example, here is a typical withdrawal UI. This one is from Binance. Study the screenshot to make further discussion more straightforward. You can reach the withdrawal page on Binance in multiple ways, including clicking the Withdraw option at the top of the Overview page or the Fiat & Spot page. You can also click the Withdraw option on the right-hand side of any token you have in your portfolio.
Before we get started, you should consider how much you intend to send. As with wallet-to-wallet transfers, exchange withdrawals can go wrong through user error. So always send a tiny test transaction before sending funds you cannot afford to lose.
Binance withdrawal UI
In the preceding image, you can see we have a few options. The first option is the Coin field. Here, you need to click the drop-down box to choose a coin. In the following image, you can see the scrollable selection of coins in the drop-down box. For example, I have a few dollars of a coin called ATOM. The word underneath ATOM is Cosmos, and this indicates ATOM’s native blockchain is called Cosmos. Although, as we will see, you often can withdraw a coin to more than just its native blockchain. Usually, if you are storing a coin for any time, you will likely use the native chain. The topic of bridging and why we might use a non-native chain option is discussed in a later section.
ATOM selected for withdrawal
I selected the ATOM coin; you can see my selection in the main Withdraw UI.
Main UI after ATOM selected
In the preceding UI, Binance informs me that the minimum withdrawal is 0.01 ATOM. This is just a few cents at the time of writing. It tells me the network fee will be between 0.004 and 0.012 ATOM. So the worst it can be is again in cents. This is a bargain compared to our transaction with Ramp and Exodus in chapter 4. We can happily proceed with minimum withdrawals and fees like this, but you should always check. Fees can spike very high, especially on Bitcoin and Ethereum. In addition, the exchanges take a cut and often add to the costs. They are only sometimes in the cents and should always be checked to avoid nasty surprises.
Next, we could enter an address to send the ATOM tokens. If we do, Binance will best match the address format to a network automatically. For example, the format is quite distinctive with ATOM on Cosmos, and Binance would likely match it perfectly. However, with many blockchains, and chains based on or connected to Ethereum, the format of the addresses is identical, and not explicitly selecting the correct chain for your wallet with the corresponding address will result in losing your funds. With Bitcoin, the address should always start with bc1. Older bitcoin wallets can often start with different letters but by now, all the best wallets and exchanges should have upgraded to the bc1 formatted addresses.
To see our options, click the Network drop-down selector, and you will see the following options for networks that support ATOM.
Selecting the Cosmos network
We can see that BSC and BNB are also supported in addition to Cosmos. We have already said that Cosmos is the Native chain for ATOM. If you choose anything other than the native chain, there is some additional risk.
This next image shows that if you are withdrawing BTC there are also some additional options.
Options to withdraw Bitcoin
On some exchanges, there will be even more options than this. I love dabbling with weird and wonderful cryptos and blockchains, but I have never stored my BTC on anything but the Bitcoin network. Don’t choose anything but the native chain until you have researched and understood the risks. Anyway, back to withdrawing some ATOM on the Cosmos blockchain.
I am withdrawing ATOM to a native Cosmos wallet, so I have selected ATOM | Cosmos.
As you select the chain, Binance will pop up the following warning.
Warning to fill in the MEMO
This warning is potentially significant, although not to me in this context. Some blockchains require you to type a memo, an extra code to attach to the transaction. There are specific tokens in certain circumstances where your coins will be lost if you forget the memo. An example of this is when you are sending to another exchange, and the exchange has a communal wallet address for all deposits of a specific token. The memo might be the only thing that distinguishes your ATOM from a million other customers.
I know from experience that the Exodus wallet is uniquely mine and does not require a memo for ATOM deposits. If you need more clarification, a quick Google search usually finds the required information. If, like me, you are sending ATOM to your Exodus wallet, you can click the Confirm button and ignore the warning.
Next, we need to get the address of our ATOM wallet on the Cosmos chain. In the Exodus app, I clicked on the Cosmos|ATOM option in the ticker tape at the top of the Wallet screen. The ticker tape is shown in the following image.
Click on Cosmos on the ticker-tape
Next, you can see I have zero ATOM tokens in this wallet. Therefore, I clicked on the Receive button, as shown below.
Click the Receive button.
This brings up the Your Address screen, as shown next.
The Your Address screen
Click on the address to copy it, and as we did when sending BTC, note a few characters at the start and end of the address so we can verify that we have copied it correctly. Note that the COSMOS at the beginning of the address is part of the format. I remembered characters 1tys…v3y2.
If you are withdrawing BTC, you would get your BTC address in the exact same way as we did in Chapter 4.
In the following image, I have pasted my wallet address into the Address field on Binance. You can also see that the check digits match up. Furthermore, a message in green text underneath the Network field confirms that the address format is correct. Note that it can be on the right network with a valid format and still provide the wrong address. Therefore, always check thoroughly or send a tiny test transaction before sending funds you cannot afford to lose.
The completed withdrawal form
When you’re ready, click the Withdraw button. You will get a repeat warning about the memo field. Click Confirm after doing your due diligence.
Next, enter the identity check codes, as shown in the following image.
Three 2FA codes required
You must click both the Get Code links in the preceding image. This will send a code to your phone and a code to your email. Note that this will be slightly different if you use a different exchange or have chosen other security options with your Binance account. Furthermore, this form is counterintuitive because the top code requires you to use a 2FA app such as Google 2FA, which gives a time-sensitive code. If you typed it in first, then by the time you had got the email and phone codes ready, the 2FA would likely have expired. If you have the same options as me, put the 2FA code in last, then click Submit.
At the time of editing, I notice that Binance has reduced the withdrawal check to a single 2FA code. Of course, this makes life much quicker but also less secure. Also recently, I notice the Google 2FA app has added the option to backup to the cloud. So, now, all you need is one 2FA code to be hacked and that is potentially on the cloud. This is a concern to be considered. The approach I took was that I like the reassurance of having my 2FA backed up to the cloud but to make sure I can’t lose too much in a hack I keep only very small amounts on any exchange. You decide what is appropriate for you.
Confirm the transaction details; mine are shown in this next image, and click the Continue button.
Click the continue button after checking the details.
Click Submit and then Complete. You will get a message about waiting up to 12 hours. I guess Binance might like to delay things when it suits them, perhaps when there are security concerns. After some years of using Binance, I have never had a withdrawal delay. However, it is a warning that we should always self-custody our crypto because if your crypto is on Binance, Binance has control of it. A quick note about my terminology: when I say your crypto is “on Binance,” it is never really “on Binance.” It is on the blockchain, Cosmos in this case, and Binance holds the private key. So until you withdraw “from Binance,” all you have is a pretty user interface telling you how much ATOM Binance holds the private keys for – on your behalf.
In the following image, you can see that my ATOM transaction is pending on Binance. You will see this section if you scroll down slightly on the Withdraw screen.
The pending withdrawal on Binance
Let’s go back to the Exodus wallet and see when it arrives, hopefully.
ATOM has arrived and shows in the Exodus wallet
In the preceding image in Exodus, you can see that my ATOM has arrived in my wallet. Notice that on the lower part of the screen, you can click a link to see your transaction on the Cosmos blockchain, just as we did with Bitcoin. Again, a note about terminology. As with Bitcoin, the ATOM is not “in my wallet.” Instead, it is on the Cosmos blockchain at a public address controlled by the private key known by my Exodus wallet derived from my seed phrase, which I securely backed up – right?
In the following image, you can see the withdrawal screen on Kucoin.
Kucoin withdrawal screen
In my experience, withdrawing crypto from an exchange is more uniform than trading. You can see all the same fields in the preceding image, just a slightly different layout. The items that do vary, sometimes significantly, when withdrawing crypto are the fees. Exchanges can charge extra on top of the network fees. Sometimes an exchange will favor one network over another. It is always worth shopping around to decide where to buy any token. We will be withdrawing crypto in numerous tutorials throughout the book, and I will explain my choices as we proceed.
Summary
It is my estimation that you could easily buy and withdraw some Bitcoin or even some other crypto at this point. But what if you want to make sure you buy BTC at the best price? One option is to set some limit orders and hope the price goes low enough. The other, the more certain way is to use a strategy and a trading bot to make regular purchases. This technique is covered in the next chapter.
Previous: Trading on Centralized Exchanges
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