You are definitely not the only one, but have you ever got stuck thinking about which blockchain to use for a specific type of cryptocurrency transaction? If this sounds like you then you may want to follow through with this guide to save yourself future confusion.
The past few years have witnessed a surge in the number of digital currencies, as well as blockchain systems. Currently, Statista puts the number of cryptocurrencies in circulation at slightly above 6,000. Similarly, the number of blockchain systems has grown from merely one more than a decade ago to currently surpass 28.
As a result, even for someone with a lot of experience in the industry, getting confused about which cryptocurrency to transact on which blockchain is not unusual. In this article, we’ll explain how to figure out which blockchain to send your transaction. However, before we dive into the main discussion, let’s take a look at some reasons you may encounter failed transactions.
Why you may experience a failed cryptocurrency transaction
Aside from the fact that you may be transacting with an incompatible blockchain, you may also experience a failed transaction if any of the following is not verified to be correct:
- Whether the currency you are sending to a wallet address is supported. To begin with, you simply do not assume that a wallet address can accommodate any type of cryptocurrency. Not so many are aware of this and constantly fall into the same mess over again.
- Whether the destination wallet address is correctly spelled. Just like with the conventional banking system, you are required to type a correct bank account so as to send a fund to a third party. Where the account number is wrongly written, a sender could be at risk of crediting an entirely different person. In the same manner, a wallet address which is typically lengthier and consist of different alphanumeric characters must be correctly written to avoid failed cryptocurrency transaction.
- Whether you are logged into your correct wallet. For someone who is already familiar with how crypto transactions work and may have multiple blockchain wallet addresses, you must double-check that you are logged into the right one. You might have to deal with a failed transaction if you don’t.
- Whether the transaction is reflecting on your transaction feed. Sometimes, a transaction may not reflect on the primary wallet transaction feed. Instead, it may be hidden in a sub-wallet, or perhaps still incoming. You can quickly monitor your wallet’s activity to see if a transaction is incoming or concealed in a sub-wallet.
- Whether the receiving address is in an archived sub-wallet or imported. Here, a transaction may fail to reflect on your feed or history simply because its a sub-wallet. This way, you may specifically need to check the sub-wallet to confirm a transaction. In the event that the sub-wallet is archived, you may navigate to the ‘settings,’ then ‘wallet & address’, and change the settings to ‘unarchive’.
- Whether the receiving wallet address is a non-spendable one. If an address is marked as ‘non-spendable’, the transaction will appear in your transaction feed but will not appear in your balance. If you want to use this wallet type to make a transaction, you’ll need to use a private key.
How to identify which blockchain address to send different cryptocurrencies
While most cryptocurrencies are built using the same or similar underlying infrastructure – blockchain technology they all employ a varying mode of transaction.
Notably, there are four main types of blockchain including public blockchains, private blockchain, consortium blockchains (sidechains), and hybrid blockchains. Each of these types of blockchain has different examples with different types of cryptocurrencies running on each of them.
For instance, a very good example of a public blockchain is Etherum, which hosts compatible crypto projects – for example, ETH-based cryptocurrency that is built on ERC-20 token standards. Examples of ETH-based cryptocurrencies include Chainlink (LINK), Tether (USDT), Maker (MKR), Loopring (LRC), Basic Attention Token (BAT), and many more.
While the aforementioned tokens can only be stored in an Ethereum Wallet address, for instance, sending them to a private blockchain wallet address like that of Ripple or Hyperledger may end up unsuccessful. Alternatively, you can safely use any Ethereum address provided by your ledger hardware wallet like Trezor, Keepkey, etc.
It is also important to state that receiving different ERC-20 tokens other than the native Ethereum token in an Ethereum wallet will require special permission.
This type of permission is mostly required to access the ERC-20 token balance which is usually concealed in a sub-wallet as mentioned earlier. To put it another way, while some wallet providers support ETH addresses, you may not be allowed to see ERC-20 tokens associated with the address if no authorisation is granted.
To get past this problem, the foremost thing to do is to research the compatibility of wallets beforehand. For instance, you can read up the white paper of the cryptocurrency to find out on which blockchain system it is built, as well as if it is compatible with other blockchain wallet addresses outside of its default network.
Other notable examples of universal wallets for ERC-20 tokens include MyEtherWallet (MEW), and Metamask, both of which can be interfaced with any compatible Ethereum project.
Ultimately, there is no specific way to identify if a cryptocurrency is compatible with a wallet address other than to carry out personal research about the token prior to a transaction.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.