Training - Managing Your Portfolio.png

Module #5 - Managing Your Portfolio

Introduction

In this module, we are going to start moving coins around, including learning how to sell them back to fiat. Hopefully, you have bought yourself a hardware wallet, either a Ledger or a Trezor. I am not going to show you how to set these up, instead I have linked to their most helpful resources as they are regularly making software updates and I don't want my course to go out of date too quickly.

Additionally, I am going to introduce you to the Coinbase Vault and show you how to set it up.


Coinbase Vault

Many Crypto investors hold a firm rule of not keeping coins on exchanges. The history of this rule comes from the number of exchanges which have been hacked, and vast amounts of customer coins which have been stolen. In many cases, these customer balances were not insured, and some have lost enormous amounts of money. The most notable example was the hack of the exchange Mt. Gox, which led to the crash and Crypto bear market of 2014/2015, which you can read about here.

Some investors are still not comfortable in managing their own Crypto wallets, and I think the Coinbase Vault is a safe option because:

So what is the Vault? It is a secure way to lock down and hold your Crypto:

Pros:

  • The Vault is highly secure and has features which limit the ability of a hacker to steal your coins
  • The security of your coins is managed by Coinbase who have a lot of experience in Crypto custody

Cons:

  • You are handing over responsibility for your Crypto to a third party (Coinbase)
  • It has a built-in time delay feature which means if you have an urgent need or want to sell your coins, you can't

I have used the Coinbase Vault and would recommend it to those who only want to have Coinbase coins in their portfolio and are worried about security. Personally, I don't use it myself anymore, but it doesn't mean I wouldn't use it in the future.

Below are instructions on how to setup and use the Vault.


Step 1: Access Your Vault

Coinbase: vault

The first thing you need to do is configure your vault. To do this, you need to access it by following these steps:

  • Go to the Accounts page
  • Click on Vault
  • The screen will change, click on Create Vault
  • The popup will allow you to create a vault for any Crypto which Coinbase has available, select Bitcoin

 

 


Step 2: Configure Your Vault

Not you have created a Bitcoin vault you need to configure it as follows:

  • Name your vault; I called mine "My Bitcoin Vault"
  • Select whether it is for an Individual or Group, groups require multiple people to approve withdrawals, I went with Individual
  • Enter a Secondary Email; this is to increase security; any withdrawal requires a confirmation from both addresses
  • Confirm Secondary Email, to complete the setup of the vault

Coinbase: naming your vault

Coinbase: vault type

Coinbase: secondary email

 Coinbase: confirm secondary email


Step 3: Confirm That Your Vault is Setup

Coinbase: confirm vault setup

Once you have confirmed your secondary email you will be able to see that the vault is now setup and available to use.

The complete screen will include the following:

  • Approvals required to instruct a withdrawal
  • Notifications that are sent once a withdrawal is instructed
  • Time Delay in place for any withdrawal - 48 hours

Step 4: Depositing Into Your Vault

If you would like to deposit Bitcoin into your Vault, you need to complete the following steps:

  • Access the Accounts page and click on the Deposit button for My Bitcoin Vault
  • In the popup you can deposit either from your Bitcoin Wallet on Coinbase or to the address of the Bitcoin Vault, I chose to transfer directly from my Bitcoin Wallet
  • Enter the Amount you wish to deposit and click Continue

You will then see a confirmation and you Bitcoin will be deposited in the Vault.

Coinbase: vault account

Coinbase: vault deposit

Coinbase: confirm vault deposit


Step 5: Withdrawing From Your Vault

If you would like to make a withdrawal from your Vault then you need to complete the following steps:

  • Access the Accounts page and click on the Withdraw button
  • In the popup, you need to enter the Amount you wish to withdraw and click on the Continue button
  • You will then receive a text message to confirm the withdrawal and an email to each address associated with the vault
  • You will need to click on the Approve Withdrawal within one of the emails you receive 
  • The 48-hour withdrawal

Note: you will receive multiple emails over the 48-hour period warning you of the withdrawal attempt to each email address you have linked to your account. Each time you will have an option to cancel the withdrawal. Once the withdrawal is complete you will receive an email confirmation and the Bitcoin will be deposited back into your Bitcoin wallet.

Coinbase: vault withdrawl

Coinbase: vault withdrawal details

Coinbase: vault withdrawal email confirmation


Using Your Ledger Nano

I have not provided a guide on how to setup and use your Ledger Nano S as they are regularly updating the software, which would require me to keep updating my guides. If you decided to purchase a Nano Ledger then I would recommend you complete the following steps:

I have found the Ledger Nano very easy to use, but if you have any questions, please do feel free to ask.


Using Your Trezor

I have not provided a guide on how to setup and use your Trezor as they are also regularly updating the software, which would require me to keep updating my guides. If you decided to purchase a Trezor then I would recommend you complete the following steps:

I have found the Trezor very easy to use but if you have any questions, please do feel free to ask.


Selling Coins

If you have reached the point where you have decided you want to sell some of your coins back to fiat, then I would recommend doing this on Coinbase for now. You may wish to research options with better rates but for now we will do this on Coinbase.

Selling Crypto is almost identical in the process as buying, just follow these steps:

  • Access the Buy/Sell page
  • Ensure that the Sell tab is selected
  • Select the wallet you wish to sell from, I selected BTC Wallet, thus Bitcoin
  • Select where you wish to deposit to, I selected GBP Wallet
  • Select the amount you wish to sell, I selected the max amount
  • Click on the button for Sell Bitcoin Instantly

Coinbase: sell Bitcoin

Coinbase: confirm sell

A confirmation screen will appear, confirming all the details of the sell, once you are happy:

  • Click on the button for Confirm Sell
  • You will then see a confirmation screen
  • You can also check the sale by accessing the Accounts page and checking your GBP Wallet

Coinbase: sell complete

Coinbase: GBP Wallet


Module #5 Summary

  1. Your can safely secure your Crypto in the Coinbase Vault: this has a number of additional security features such as a 48 time delay to release the coins
  2. A hardware wallet is best for securing your Crypto yourself: and you should buy either a Nano Ledger or a Trezor
  3. You can sell your coins again on Coinbase: and this will convert them back into your local currency

Now you understand how to manage your Crypto, you can move onto Module #6 and learn about advanced investing.