Lesson 6: How to Send & Receive Crypto Transactions

Lesson Overview

Owning cryptocurrency isn’t just about buying and holding—it often involves moving those assets from one wallet to another. Whether you’re making a payment, funding an investment, or shifting assets across different platforms, it’s essential to do so correctly and securely. Unlike traditional banking, where errors might be reversed or refunded, crypto transactions are final once broadcast to the blockchain. Mistakes—like sending to the wrong address—can lead to permanent loss of funds.

This lesson covers the fundamentals of sending and receiving cryptocurrencies, explains how transaction confirmations work, and highlights common pitfalls so you can transfer assets confidently. By the end, you’ll be prepared to avoid costly errors and manage network fees intelligently—crucial skills for anyone actively transacting in the crypto world.

What You’ll Learn

• How crypto transactions work on the blockchain
• Step-by-step instructions to send and receive funds securely
• Wallet addresses, QR codes, and the importance of network selection
• Transaction confirmations and the role of gas/network fees
• Common mistakes (like sending to the wrong address) and how to avoid them

1) How Cryptocurrency Transactions Work

When you send crypto, you’re effectively updating the blockchain ledger to reflect that some of your coins now belong to someone else. Understanding the basics of this process can help you grasp why double-checking information is so critical.

1. Sender: The person initiating the transaction. They must own the coins and have access to their private keys.
2. Recipient: The wallet address that will receive the funds.
3. Transaction Data: This includes the amount of crypto to be sent, network fees, and addresses for both sender and recipient.

Once created, the transaction is broadcast to the blockchain network. Nodes (computers running the blockchain software) validate it, ensuring you have sufficient balance and haven’t already spent the same funds elsewhere. If everything checks out, the transaction is grouped into a block, which is then added to the chain.

Key Takeaway: Crypto transactions are irreversible. If you accidentally input the wrong address or amount, there’s no bank or central authority to fix it.

2) How to Send Cryptocurrency

Sending crypto can be straightforward, but only if you follow secure practices.

A) Steps to Send Crypto Securely

1. Open Your Wallet

   • Log into your mobile, desktop, or hardware wallet. Ensure you’re using the correct application or official site to avoid phishing.

2. Enter the Recipient’s Address

   • Copy and paste the recipient’s wallet address. Don’t type it manually—crypto addresses can be dozens of characters long. A single typo means losing funds.
   • If the address is presented as a QR code, you can scan it to reduce errors.

3. Choose the Amount

   • Decide how much crypto you’re sending (e.g., 0.05 ETH).
   • Double-check you’re sending the correct token on the correct network (e.g., Ethereum vs. Binance Smart Chain).

4. Set the Transaction Fee (If Applicable)

   • Some wallets let you choose how much gas or network fee to pay. A higher fee generally confirms faster, a lower fee might result in delays.

5. Confirm and Send

   • Always review the transaction details one last time.
   • Once you confirm, the transaction is broadcast to the network, and you’ll wait for confirmation.

B) Example of a Crypto Transaction

• You want to send 0.05 ETH to your friend.
• You open MetaMask, select “Send,” then paste your friend’s ETH address.
• You enter 0.05 ETH as the amount and review the estimated network fee.
• You confirm and wait for a transaction hash to appear. After a short period (depending on network congestion), your friend’s wallet reflects the new balance.

Key Tip: If you’re sending a large amount, do a small test transaction first to confirm the address and network are correct.

3) How to Receive Cryptocurrency

Receiving crypto is generally simpler than sending: you just share your wallet’s public address with the sender.

A) Steps to Receive Crypto

1. Open Your Wallet

   • Go to the “Receive” or “Deposit” section. This might be labeled differently depending on the wallet.

2. Copy Your Wallet Address

   • This address is a long string of letters and numbers (or a QR code). It’s safe to share because it doesn’t grant anyone control over your funds.

3. Share It with the Sender

   • Ensure you’re explicit about which network you’re on if the coin exists on multiple blockchains. For example, if you want BEP-20 BNB on Binance Smart Chain, clarify that it’s not the same as Ethereum’s ERC-20 tokens.

4. Wait for Confirmation

   • Once the sender initiates the transaction, the blockchain will process it.
   • You’ll see the balance appear in your wallet after the transaction confirms.

Key Insight: Always verify you’re using the correct blockchain. For instance, if you provide an Ethereum address for receiving ETH but the sender accidentally selects Binance Smart Chain, your funds could be lost or stuck.

4) Understanding Wallet Addresses & QR Codes

Cryptocurrency addresses can look intimidating at first. They’re typically composed of alphanumeric characters, and their length ensures there’s a near-zero chance of accidentally generating a duplicate.

A) What Does a Wallet Address Look Like?

1. Bitcoin (BTC): Often starts with 1, 3, or bc1 (e.g., bc1qxy2kgdygjrsqtzq2n0yrf2493p83kkfjhx0wlh).
2. Ethereum (ETH): Always starts with 0x (e.g., 0x4bbeeb066ed09b7aed07bf39eee0460dfa261520).
3. Binance Smart Chain (BSC): Uses the same address format as Ethereum (also starts with 0x).

Tip: Some addresses are used on multiple networks (e.g., an address that starts with 0x could be for ETH or BSC). It’s crucial to choose the right network in your wallet settings or exchange withdrawal options.

B) Why Are QR Codes Used?

• Convenience: Scanning a QR code in your wallet app is simpler than typing or copying a long address.
• Error Reduction: Minimizes the risk of copy-paste mistakes.
• Speed: Speeds up in-person transactions, e.g., paying for goods or services at a store.

Key Takeaway: Crypto addresses are long and prone to manual errors. Use copy-paste or QR codes whenever possible to avoid mistakes.

5) Transaction Confirmations & Blockchain Fees

Blockchain networks rely on miners (in Proof of Work) or validators (in Proof of Stake) to secure transactions. They’re rewarded with fees (or block rewards) for their work.

A) What Are Confirmations?

When a transaction is included in a newly mined/validated block on the blockchain, it receives its first confirmation. Each subsequent block stacked on top of that transaction is another confirmation.

• Bitcoin: Typically, 3–6 confirmations are considered secure, which can take 10–60 minutes depending on congestion.
• Ethereum: Often finalizes within a minute or two, though exact times vary.
• Faster Chains (e.g., Solana, Polygon, BSC): Can finalize in seconds.

B) Network (Gas) Fees

To incentivize miners/validators, each transaction requires a fee. This fee can fluctuate significantly depending on network usage:

• A busier network = higher fees (because you’re competing to have your transaction processed).
• Some wallets let you adjust the fee. Paying more typically results in faster confirmations.

Key Tip: Before transferring large amounts, check the current network fees and consider waiting for off-peak times if fees are extremely high.

6) Common Mistakes & How to Avoid Them

Given the irreversibility of crypto transactions, small errors can be catastrophic. Here’s what to watch out for:

1. Sending to the Wrong Address

   • Always double-check addresses. If possible, verify the first four and last four characters match what you expect.

2. Selecting the Wrong Network

   • For example, sending ETH from an exchange to an Ethereum address on the Binance Smart Chain by mistake. Funds can end up in limbo or be lost altogether.

3. Not Including Enough Gas/Network Fees

   • A transaction might be stuck in a pending state if the fee is too low. Some networks allow you to speed up or cancel a transaction by paying a higher fee, but it can be tricky.

4. Falling for Scams

   • Phishing websites that mimic legitimate wallets or exchanges.
   • Bogus “support” staff asking for your private key to “fix” a stuck transaction.

5. Forgetting to Do a Test Transaction

   • If you’re sending large sums, it’s wise to test with a tiny amount first. Once you confirm the small transaction works, proceed with the main transfer.

Key Takeaway: A careful review of address, network, and fees before clicking “Send” can save you from irreversible losses.

7) Reflection Questions

Spend a moment considering these questions to reinforce what you’ve learned:

1. Why is it crucial to verify the recipient’s address and network before finalizing a transaction?

   • Think about the irreversibility of blockchain transfers.

2. How do transaction fees affect the speed of your transfer?

   • Reflect on what happens if you choose a very low fee vs. a higher fee.

3. Have you experienced delays or “stuck” transactions in the past, and what caused them?

   • Consider network congestion or insufficient gas fees.

4. What practical steps can you take to prevent sending crypto to the wrong address?

   • List out methods like scanning QR codes, double-checking the first/last digits, or testing a small transfer.

8) Summary & Key Takeaways

1. Irreversible Transactions: Crypto transfers, once broadcast, cannot be undone, so caution is paramount.
2. Sending Crypto: Involves choosing the right address, amount, network, and fee.
3. Receiving Crypto: Requires only your public address, but you must make sure you’re on the correct blockchain network.
4. Wallet Addresses & QR Codes: Because addresses are long and prone to error, always use copy-paste or scanning methods to minimize typos.
5. Network Fees & Confirmations: Each blockchain has different fees and confirmation times. Busy networks mean higher costs and potential delays.
6. Avoid Common Mistakes: Double-check everything—address, token type, network—especially for larger transfers.
7. Best Practices: Use small test transactions, keep an eye on network fees, and never share your private keys or seed phrases.

9) Next Steps: What’s Coming in Lesson 7?

You now know how to send and receive cryptocurrency securely, which is a fundamental skill for anyone active in the crypto world. But there’s always a risk of scams, phishing, and fraud when dealing with digital assets. In Lesson 7, we’ll dive into:

• Common Crypto Scams: How they work, why they succeed, and how to identify them
• Phishing Attacks: Recognizing fake emails, websites, and wallet apps
• Protecting Your Assets: Security tips and best practices to keep your funds safe long-term

Ready to safeguard your investments and avoid cybercriminals’ traps? Let’s move on to Lesson 7: The Ultimate Crypto Scam Protection Guide and equip yourself with essential security knowledge!