Guide to Converting Grain

This is a step-by-step guide to converting your Grain to USD (or any other currency of your choice. @decentralion, if you could comment on anything that needs editing or anything you think would be useful to add, that would be helpful. Miguel and I were unsure on some of the FAQs. @panchomiguel, if you could double check the step-by-step directions for the mobile app, that would be great as well. Any and all comments are welcome, I would love for this to be clear to non-devs and non-crypto peeps

This is also a new way of creating a doc and asking for review and collaboration, compared to thew ay we reviewed Beta docs. Any feedback on this method is also apprecaited.

FAQ

  • What are the tax implications of receiving Grain?

    • We are not tax advisors. This is not tax advice. The following statements are informational only and provided on a best-effort basis. Please consult a tax professional for advice about your situation.
    • As soon as you have Grain, it is taxable and should be reported to IRS the proceeding tax season (fact check this)
  • What are DAI?

    • DAI is a stable coin within the Ethereum ecosystem. It is always very, very close to $1 per DAI.
  • How long does it take to convert Grain to USD?

    • Converting Grain to DAI takes up to 7 business days, although is often done sooner than that. Converting DAI to USD is instant, and the money will
  • Can I convert Grain to a cryptocurrency rather than USD?

    • Easily. Instead of converting DAI to USD and then transferring it to a linked bank account, you can buy cryptocurrencies at their market price with your DAI. This is, of course, variable, as market prices change for most cryptocurrencies.

    How it Works (the basics)

  • You open a Coinbase account.

  • You send our Treasurer, Miguel, a Grain Sale Request Form and he will send DAI from the SourceCred hardware wallet from the SourceCred account to your wallet on Coinbase. He will then create a Pull Request on Github telling the SourceCred code that this transaction took place, so your Grain balance on the Grain Ledger will show the adjusted amount.

  • You go on Coinbase or CoinbasePro and sell your DAI for USD (or any other currency).

Step by Step (Desktop)

Convert Grain to DAI

  • Open a Coinbase account. For this you will need to link a bank account.

  • Fill out the Grain Sale Request Form and send to [[PanchoMiguel]] on Discord. You will need to know:

    • How much Grain you want to convert. You can check the Grain Ledger to see how much Grain you have available. Grain in the SourceCred community is distributed every Sunday.
    • Choose the ETH address would you like DAI sent to. In the upper right hand corner of Coinbase, there is the word “Receive.” Click this, select “DAI” for your currency, and copy the address. This is your ETH address. You must copy the address after you choose your currency, as the address is different for each currency.

Convert DAI to USD and withdraw from cryptowallet

  • The next step is to withdraw your USD from your cryptowallet and have it sent to your linked bank account. You have two choices:

  • a) You can use CoinbasePro (recommended), which is automatically linked to your Coinbase account. CoinbasePro is free and converts DAI to USD instantly. The site may look complicated, but don’t let that scare you, using it can be simple. To do this, you will need to transfer the DAI from your Coinbase wallet to your CoinbasePro wallet. Even though Coinbase is automatically linked to CoinbasePro, they are separate wallets.NOTE FOR MIGUEL - Is Coinbase Pro instant in converting DAI to USD, or is it instant in sending USD to your bank account? When I used Pro to send to my bank account, it said it would take 3-5 business days but in the next step said it would be instant.

    • Go to the CoinbasePro Trading page and search the drop-down Market menu until you find DAI-USD.
    • Then click Deposit and select DAI.
    • Select the bottom option, Coinbase.com, and select an amount. You have now transferred your DAI to your CoinbasePro wallet.
    • On the CoinbasePro Trading page, click Sell and select the amount you would like to sell.
    • DAI is a stable coin, but it does fluctuate by about 1/1000th of a penny throughout the day. Because of this, you need to let your limit price, the price you want your DAI to sell for. The orange and green numbers that are moving on your screen are the updated price of DAI over time. Pick any of those numbers (it will be around 1.0078) and type that in your “Limit” box. When the DAI market hits that price again, (possibly in a matter of seconds) the conversion will be made.
    • Next, you need to withdraw your USD from your cryptowallet and send it to your linked bank account. Click "Portfolio’ in the upper right hand corner.
    • Click “Withdraw” and select USD.
    • Select “Bank Account” and choose your amount. A 2-factor authentication code will be sent to your phone.
  • b) You can use Coinbase to convert your DAI to a currency of your choice. This costs how much? and takes 2-3 days to reach your bank account.

    • Go to your portfolio, scroll down and click DAI.
    • Click Overview.
    • On your right, there will be the option to Sell or Buy DAI. Click “Sell” and make sure the sale is from DAI to USD. Choose and amount and click “Sell DAI.”

Step by Step (Mobile)

NOTE FOR MIGUEL I copy/pasted this from the Desktop version, could you please make changes so it’s applicable for Mobile?

Convert Grain to DAI

  • Open a Coinbase account. For this you will need to link a bank account.

  • Fill out the Grain Sale Request Form and send to [[PanchoMiguel]] on Discord. You will need to know:

    • How much Grain you want to convert. You can check the Grain Ledger to see how much Grain you have available. Grain in the SourceCred community is distributed every Sunday.
    • Choose the ETH address would you like DAI sent to. If you are using the Coinbase mobile app, navigate to your portfolio. Select your DAI portfolio then your DAI wallet. In your DAI wallet, click the QR code in the upper right hand corner to see your address.

Convert DAI to USD and withdraw from cryptowallet

  • The next step is to withdraw your USD from your cryptowallet and have it sent to your linked bank account. You have two choices:

    • a) You can use CoinbasePro (recommended), which is automatically linked to your Coinbase account. CoinbasePro is free and converts DAI to USD instantly. The site may look complicated, but don’t let that scare you, using it can be simple. To do this, you will need to transfer the Dai from your Coinbase wallet to your CoinbasePro wallet. Even though Coinbase is automatically linked to CoinbasePro, they are separate wallets.

      • NOTE FOR MIGUEL - Is Coinbase Pro instant in converting DAI to USD, or is it instant in sending USD to your bank account? When I used Pro to send to my bank account, it said it woudl take 3-5 business days but in the next step said it would be instant.
      • Go to the CoinbasePro Trading page and search the drop-down Market menu until you find DAI-USD.
      • Then click Deposit and select DAI.
      • Select the bottom option, Coinbase.com, and select an amount. You have now transferred your DAI to your CoinbasePro wallet.
      • On the CoinbasePro Trading page, click Sell and select the amount you would like to sell.
      • DAI is a stable coin, but it does fluctuate by about 1/1000th of a penny throughout the day. Because of this, you need to let your limit price, the price you want your DAI to sell for. The orange and green numbers that are moving on your screen are the updated price of DAI over time. Pick any of those numbers (it will be around 1.0078) and type that in your “Limit” box. When the DAI market hits that price again, (possibly in a matter of seconds) the conversion will be made.
      • Next, you need to withdraw your USD from your cryptowallet and send it to your linked bank account. Click "Portfolio’ in the upper right hand corner.
      • Click “Withdraw” and select USD.
      • Select “Bank Account” and choose your amount. A 2-factor authentication code will be sent to your phone.
    • b) You can use Coinbase to convert your DAI to a currency of your choice. This costs how much? and takes 2-3 days to reach your bank account.

      • Go to your portfolio, scroll down and click DAI.
      • Click Overview.
      • On your right, there will be the option to Sell or Buy DAI. Click “Sell” and make sure the sale is from DAI to USD. Choose and amount and click “Sell DAI.”
7 Likes

Thanks! Your timing couldn’t be more spot on @Bex :] Just began sorting things before the end of the year.

A couple of notes that come to mind for me.

  • Tax law (and worker protection laws) varies greatly per country, so definitely check what applies for you. In my case I suspect I can’t receive the DAI as a private entity, so will be looking into business accounts for this.
  • Coinbase is an exchange which manages your wallet for you. Typically this is a good recommendation for exchanging it to fiat currency, but it’s a risky place for long-term storage if you want to hold onto your crypto. For using crypto long-term it’s worth researching secure alternatives. Imo that doesn’t need a step-by-step, as managing your own wallet keys without really knowing what you’re doing is perhaps even more risky. But for people fairly new to it all it’s probably an important warning. Empty out your Coinbase account regularly, lest the 20th headline about stolen coins includes yours.
4 Likes

The advice I’ve been given since reading this is that any tax advice should be avoided, so I don’t think the different country tax laws will be an issue anymore. As for holding your money in Coinbase, I would imagine anyone not familiar with it would want to get their money out immediately, as Coinbase would be unfamiliar to them. It’s definitely worth noting though that it’s safer to do the full conversion rather than holding onto it as DAI or USD in Coinbase.

Something to note here wrt @Beanow post

This “Guide to Converting Grain” is specifically for people that want to go as quickly as possible from having Grain to having US Dollars. Coinbase is used here because it seems to be the most pain free and convenient way for Gringos to go from Crypto to a regular old bank account. Because of this, many people including myself, get SC to send Dai directly to their Coinbase exchange hot wallet, and then convert the Dai immediately to USD.

There are different, relatively “safe” things you could do to hold onto your Dai and/or exchange it for a different cryptocurrency that you then hold, but those go beyond the scope of this document it seems

@Bex Dai is not converted to USD immediately - the order needs to be filled by the market. You have immediate access to the USD in your Coinbase account once your limit order gets filled. However, to withdraw that USD to your US Bank account does take a few days, although in practice I find that it shows up sooner than I expect (often within a day).

I agree @panchomiguel, the quickest route to fiat is probably a common use-case, and this a sensible way to approach it. Saves a little bit on transaction fees and fewers steps to go through. But the guide isn’t particularly explicit that we’re sending directly to Coinbase with that assumption.

I think the heads up would be useful for people new-ish to crypto and have an interest in doing other things with the DAI. It’s common advice to treat exchanges and managed wallets in general as temporary. Emptying those accounts regularly helps to avoid unnecessary risks. It’s fine for that to be outside the scope of the guide, but it’s probably worth being explicit that’s why we’re going directly to Coinbase and you might want to consider alternatives if this isn’t your use-case.

This is a great start. A ton of information here which will have to be conveyed to lots of newcomers over time. The overall structure is good, and the writing is clear and concise.

As @panchomiguel points out, there are multiple ways to do this, but this is the easiest, most likely path for most. People that want to go through different exchanges or payment processors will likely already be familiar with crypto and won’t need this tutorial. It may be worth just mentioning that this is just one option though? There are likely a number of payment processors (apps) that will allow you to just sell and transfer with the click of a button (I’ve seen them for other cryptos and I’m sure some support DAI). However, fees on a lot of these services tend to be high, and many are short lived due to shifting regulations. May not be worth the trouble researching and documenting those unless people start asking for it.

It isn’t explicitly spelled out that you need to find your crypto address in Coinbase to send DAI to. This may not be necessary, just thought I would point it out. In part because of this step:

This is one way to do it (transfer from SC to your Coinbase wallet -> Coinbase Pro wallet). This transfer is free and instant. However, if you’re just planning on using Coinbse Pro, you can also just deposit directly into your Coinbase Pro wallet. Just hit the Deposit button and go through the steps. This is the way I typically do it. Or, I’ll have the DAI sent to my main crypto wallet (MetaMask) Ethereum address (which will be the same as your DAI address), then send it myself to Coinbase Pro if I want to sell.

image

Coinbase Pro used to be free, but they recently started charging a 0.5% fee on trades < $10k (if you go above that, you start getting lower rates). Here’s their fee chart. Regular Coinbase fees are considerably higher. Here’s their fee chart. The formula for calculating the fees is fairly convoluted, and varies by region. My eyes just glazed over looking at it as I’m tired. E.g. below is the fees for the US. It’s probably an easier one-click process, but if you’re selling thousands of dollars worth of DAI, %1.49 is gonna add up :grimacing:

I wonder if this is due to their recently added instant transfer feature. According to the article it only works with supported debit cards. Did you use a debit card, or enter your bank account info (you don’t have to reply here if not comfortable sharing publicly)?

Your description of the steps for selling on Coinbase Pro are good. It might be easier to convey this over video though for some people. Because I bought this screencast software I never use, and want to play with this medium anyway, took a shot at a video walkthrough. Let me know what you think! Be gentle!

This is a great guide for newcomers but I would also sugest a way to spend your DAI without having to go through the process of exchanging them into fiat. You can just swap DAI to ETH and use a service as Bitrefill to spend your crypto.

2 Likes

hey, https://app.mooni.tech/ is quite smooth for crypto to fiat (no KYC). I know the dev behind it if needed. And the USD should also be listed soon.

Interesting, thank you for sharing the Bitrefill link! Do you use it much?

Have not used it yet but have friends who have.