Best way to earn loot?

So i just started this game today and basicly only play kensei, after battles i usual get lvl 1 gear or none at all and at this point i see people around me having much higher Gearscore than i have. I scrap all the useless stuff but have no idea what to do with that currency. So basicly should i use my steel/coins or does the drops get better once i get higher level?