They say that when you want to learn a language, it's best to immerse yourself in the language. If I have the choice to take Spanish classes or go live in a Spanish-speaking country, I will become a much better Spanish communicator living in the country. The same thing holds for crypto.

Initially, I traded crypto on exchanges. This is because it was my only choice when I entered the space. However, I didn't have the knowledge or comfort to trade peer-to-peer, so I set up accounts on different centralized exchanges. Then I discovered decentralized finance (DeFi) and learned to do much more in crypto and manage it all by myself.

By immersing myself in the DeFi ecosystem, I have learned many things that have made me money and other things that have cost me a lot. But with anything in life, you have to pay to learn. And now that we are entrenched in a bear market, I am using my knowledge to save as much money as possible as money is more scarce.

After spending more time in DeFi, I see how big of a ripoff centralized exchanges are. For example, if I want to buy $1000 worth of crypto assets on Coinbase, I have to pay 1% or $1. Meanwhile, on Binance.US, converting BUSD to US dollars (fiat) costs 2% and a small fee.

Secrets for saving on fees

I can often trade and purchase crypto assets for a lower fee than centralized exchanges using decentralized finance. Additionally, I keep custody of my crypto assets when I use decentralized finance. This is beneficial in a day when you can only partially trust any centralized entity in crypto.

Furthermore, decentralized exchanges offer a wider variety of coins I can buy and sell. Often, these cryptos are riskier than what you will find in centralized exchanges but also can be more rewarding.

When you load your crypto onto a Metamask wallet, you can use multiple smart chains. Different chains have different tokens, platforms, and fees. For example, Ethereum is the largest chain in value, but it's also the most expensive chain to use. A typical transaction on Ethereum can cost several dollars worth of ETH.

Rather than interact on expensive Ethereum, I prefer to use Layer 2 solutions residing on Ethereum or competing smart chains. The Layer 2 solutions I use are Optimism and Arbitrum. And the competing smart chains I use are Binance Smart Chain and Polygon. A typical transaction on these options is usually cents instead of dollars.

Further, I can easily convert my crypto back into fiat, cash it out to my bank account, and pay no fees. For a long time, when using Binance Smart Chain, I would move my BUSD (Binance stablecoin) to Binance and pay the high price to convert my BUSD into dollars. I don't do that anymore. Instead, I use bridging to Polygon to save on costs.

What is bridging?

Going back to my original example of learning a language, let's imagine that each chain is its own language. Just as Spanish won't work in China, you need a translator. Likewise, you can't use crypto on Polygon on Arbitrum or crypto on Binance Smart Chain on Optimism. The bridge acts as an interpreter and moves your assets to the chain you want to use.

For example, let's say you have BUSD on Binance Smart Chain that you want to convert to fiat. Instead of paying the high fees on Binance.us, you can convert your BUSD to USDC on Pancakeswap. Next, you can use a bridge to convert the Binance Smart Chain USDC to Polygon USDC. Then you can send your Polygon USDC directly to Coinbase or Crypto.com. Finally, you can sell the USDC on Coinbase for zero fees and cash it out.

You can also use bridging if you want to access platforms that don't exist on the chain where the asset resides. For example, let's say you want to buy GMX tokens and stake them. GMX lives on Arbitrum. An easy way to do this would be to send Polygon USDC to your Metamask wallet. Next, you would bridge your Polygon USDC to Arbitrum USDC. Then, you can purchase GMX on Uniswap on Arbitrum.

In most instances, bridging is cheap and quick. Although bridging to and from Ethereum and Cronos typically costs more than bridging between most other chains. I don't use these chains, so bridging commonly costs me pennies.

Before you bridge

First, you want to make sure that you have your Metamask configured for both chains you are using. Again, think about these chains as different languages. You must convert your Polygon USDC to Binance Smart Chain USDC before using your USDC with the Binance Smart Chain ecosystem.

It's a good idea to add the network settings to your Metamask before bridging or sending crypto to your Metamask wallet. Here's a good resource for adding Binance Smart Chain and Polygon to your Metamask wallet.

After you have added the networks, you now want to manually add the contract address for the coin you will be using. There are a few ways to do this, but I like to use CoinGecko as a shortcut.

3. I select the explorer for the network I want to use. In this case, I will choose Polygonscan. This opens a page that looks like this.

4. Next, you click on the contract address (circled above in green). This will bring you to a screen that looks like this.

5. The contract address is circled in blue. You can copy it easily by pushing the button to the right of the address (circled in red).

6. In your Metamask, click import tokens.

7. Then you paste the address into the custom token address field.

8. Finally, hit add custom token at the bottom of the Metamask page

9. After adding USDC to the Polygon network, you can add it the same way to the Binance Smart Chain network, following the exact directions but using the bscscan explorer instead of Polygonscan from CoinGecko.

How to bridge assets

Now that you have your Metamask configured for both chains and the token showing up in your Metamask, it's time to bridge your crypto assets.

There are several bridges to choose from, but I use the most popular bridge, Multichain. Multichain is fast, cheap, easy to use, and has deeper liquidity than many competing bridges.

For this example, let's imagine you have $100 in Polygon USDC that you want to move to Binance Smart Chain. Here are the steps.

Multichain homepage

3. Connect your Metamask wallet to Multichain.org by clicking the blue "connect to wallet" button in the upper right

4. Once your wallet is connected, you can choose the chain you want to convert your token into. I typically use USDC because it transfers easily from one chain to another and typically has deep liquidity.

5. Next, you type in how much you want to bridge in the top line. It's OK to try a small amount at first because the fees to the bridge are meager.

6. Hit swap and approve the transaction in your wallet.

7. Wait (typically a few minutes). After you see success, you can switch your Metamask network to the network you bridged to, and your tokens are now there.

Bridging is simple and cheap!

The first time I bridged assets, I used a small amount to ensure I did it correctly. Remember that this is fine for most smart chains, but bridging from or to Ethereum costs at least $40.

Another thorn in your side is ensuring that you have the chain's native token for gas fees. Therefore, you should ensure you have a few Matic tokens in your Metamask wallet for Polygon and some BNB for Binance Smart Chain. Optimism and Arbitrum use ETH for their gas. You should be able to bridge ETH from Polygon cheaply to either Layer 2.

I wish there were a fountain to give you a small amount of the native tokens for gas. Some chains offer this, but it's typically a bigger hassle than just buying some of the tokens on Coinbase or Binance and transferring it to your Metamask. BNB can be challenging to source if you don't have a Binance account.

For example, if I wanted to convert $300 in USDC on Binance.us into dollars, it would cost me around $8-$10 in fees. Meanwhile, bridging the USDC to Polygon and transferring it to Coinbase costs me less than $1. Then, on Coinbase, I can convert the USDC to fiat for free.

Key Takeaways

The first time you use Metamask and DeFi, it's a good idea to test small amounts. Also, never give anyone your seed phrase for any reason. You shouldn't share it over the phone or fill out some online form. Scammers will try to get your seed phrase; if they do, you have just given them keys to your digital safe.

If you have any questions, please put them in the responses. There is always a risk with bridging and using DeFi, so use it at your own risk.

This article isn't financial advice, and I am not a financial advisor. It is strictly my opinion. I am someone who wants to maintain and grow my wealth so that I can provide a good livelihood for my family and myself. So do your research before making any investments.