So, You wish to trade do you?
We all trade cryptocurrencies from time to time. Either if it's for buying some new alt coin or invest in an ICO, we all have to trade in Fiat currencies to mainly Bitcoin first. To do this someone must have the desire to pay money for the Cryptocurrency. This can be done in 3 different ways.
Over the Counter Trading
OTC trading with other people can be both risky and expensive. You give much trust in others to hold up their end of the bargain. There are places that makes this easier.
One place is LocalBitcoins that acts like an escrow to make sure the transaction is made properly and adds another layer of security for both parties. They are still centralized and you store your coins on their central ledger, trusting them with your coins.
Middlemen are still taking a cut from the transaction if you use them.
Traditional Exchanges; Money Hoarders and Insecure
The Traditional exchange is usually a company that starts up to make good money on trading. They take a small fee for each transaction. This fee keeps the exchange running, but if they make any surplus or how they spend the money is mostly unknown. They are also very insecure since you are storing your coins in their system, with just a note in their ledger that it's yours. They have an I Owe You towards you, it's not really your money when they are on the traditional exchange.
We have seen this happening when exchanges goes under, like Mt. Gox and most recently BTCe. It's not guaranteed that you will have anything when they go under.
BitShares Open DEX; Where the Magic and Unicorns Happens
The Open DEX is much like a traditional exchange; but also so far away from it as you can imagine. There are two parts of this that you need to understand.
- BitShares DEX; The Platform that runs the ledger
This works like an ordinary Cryptocurrency Wallet. You deposit coins to your own wallet and they are recorded to the BitShares network ledger. You own your assets and control them. No company has any IOY over them.
- DEX Company Exchanges; The company that backs with assets
As much as the BitShares DEX can run on its own there are companies that utilizes the platform to run their own Exchange company on. They usually run UIA (User Issued Assets) that they back up with real coins and money. They also work as gateways to transfer coins in and out of the BitShares DEX system.
Getting Started
So, now you know a little basic about how the BitShares DEX system is built up. There are much more information about it here on Steemit and you should browse #bitshares for many more interesting updates.
Making an Account; Signing Up on the BitShares DEX
First we need to open an account. You can use the OpenLedger.io sign-up page, this is easiest as they stand for the small fee that is required to create an account. https://bitshares.openledger.info?r=sc-ol
I recommend to use the Wallet Mode when signing up. This is a much more secure way of creating an account, but requires a little more of you to make sure you can log in again on anoter comuter. We will look at this futher down as we are starting to use the DEX.
On the Wallet Sign-up page, fill in a unique username and a long password. I recommend using something like a long string of names or towns that is easy to remember for you, but quite impossible for anyone else to even guess.
Welcome!
You are now officially on the DEX, your first step on liberating your trading!
You are now officially on the DEX, your first step on liberating your trading!
First Step: Make a Backup
First of all, we need to make sure you are never locked out of your account.
Create Wallet Backup
This is a .bin file that you use for importing the account. Together with your account password.Create Brainkey Backup
This is a long phrase of words that you use for importing the account. Together with your account password.
Either way works good. Both should be kept in a very safe and secure way.
Second Step; Add Some Assets to Trade With
Now we can feel secure enough to add some assets to our new account so we can start trading. You do this by the top menu and clicking the Deposit/Withdraw tab.
This is where the OpenLedger Deposit Gateway comes in. As you can see there are a few other operators, but the OpenLedger system works really well and has many cryptocurrencies, as well as STEEM and SBD.
I've stroked the Memo in the image, this is unique for every transaction.
IT'S VERY IMPORTANT TO SEND TO THE CORRECT ACCOUNT AS WELL AS WITH THE CORRECT MEMO KEY
Third Step; Start the Exchanging!
The transaction of coins to the new BitShares DEX wallet will only take a few minutes. The BitShares system is very quick and works with the same underlying blockchain system as Steemit.
Once the deposit is done you can click the Exchange Tab and start trading!
We will cover trading in a future tutorial
Until then, start exploring and using the DEX. You can trade practically anything on it as long as there is anyone that wish to buy it.
I recommend to look at #whaleshare created by @officialfuzzy. It's a great example on how to use the Decentralized Exchange to support the community.
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Good article, except you are wrong about Localbitcoin. They will hold the BTC in escrow, until both parties agree the transaction is complete.
Didn't say they didn't. However, I could change that to make it more clear that LocalBitcoins is more safe than other OTC trading just because of the fact that they are holding assets in escrow until the deal is done.
With current problems in Poloniex I am going to start trading at Openledger, maybe I will post an article about my experience when I do it.
@sc-steemit I would love a screen video demonstration for this. I'll appreciate it if you can
I understand that a video tutorial would be an optimal solution for understanding things like the BitShares DEX. I may look into it, but I have no experience with making video tutorials. I'll look into it :)
good - reply - votes
Thanks, I'm definitely checking out and possibly getting my wallet account on bitshares Dex. It does look kind of involved but I shall spend a little time later to work it out.
I does have a bit of a learning curve, but it's not any more difficult than trading on any other platform like Poloniex. Go check it out, doesn't cost to sign up.
I sure will, appreciate it :)
Appreciate the post. Will save for passing on to noobs who wanna sign up for Bitshares account! Thanks again!