The popularity of cryptocurrencies and their value indicate that no one expects the cryptocurrency system to collapse. Although Bitcoin is reliable, secure, and in high demand, it cannot be used universally as a means of payment. Sometimes there is a need to convert it into fiat currency. This article will tell you how and where you can sell this cryptocurrency.
A little bit of Bitcoin history
In order to find out where best to sell Bitcoin, it is necessary to understand what it is. It often happens that even active users of cryptocurrencies for payments have absolutely no idea what they are actually using. Recall that Bitcoin is both a blockchain and a cryptocurrency. The blockchain stores absolutely all information about all previous transactions, so it cannot be faked. The system is decentralized, so even a change in the computer network has no effect on the blockchain as a whole. Moreover, the computer on which the change was made can no longer use Bitcoin until the user corrects it.
The first Bitcoin blockchain appeared in 2009. At the same time, it was when the first Bitcoin holder first sent coins to another member of the network, and in the same year, 2009, Bitcoins were exchanged for fiat currencies for the first time.
Bitcoin’s growing popularity tends to be a direct response to the insecurity of paper money. Due to inflation, the new crisis, etc., people are beginning to become interested in alternative ways of storing their savings. One of them is the Bitcoin format.
It is always more difficult to sell Bitcoins than to exchange them, but given the decline in the purchasing power of money, it is better than losing savings.
Why sell Bitcoins?
For fans of cryptocurrency, there are many reasons why they might want to get rid of their Bitcoins. Most of the reasons have to do with risk.
Regulatory risk. Almost all countries do not clearly regulate Bitcoin and other cryptocurrencies. Although some countries have become tax shelters for Bitcoin, most warn their citizens against trading in cryptocurrencies. There is also uncertainty about whether Bitcoin transactions are taxable or not. As a result, Bitcoin comes with increased regulatory risk.
Variety with. In addition to Bitcoin, there are many other cryptocurrencies with high potential. Other altcoins such as Ethereum, Ripple, Binance Coin and Cardano look promising.
Bitcoin trading opportunities
With the growing popularity of Bitcoins and cryptocurrencies, there are more and more services that allow you to quickly and efficiently buy Bitcoins or convert them into fiat currency. There are several ways to sell Bitcoins, all of which differ slightly from each other. When choosing, the choice depends on how much you want to get from the sale, how much time you have and at what price you want to sell your Bitcoins.
Selling Bitcoins on an exchange
One of the most common and easiest opportunities to sell Bitcoins online and convert them into cash is to sell on an exchange. Exchanges serve as resellers and sell your Bitcoins on your behalf. Through a cryptocurrency exchange, you can sell an entire coin or a portion of it. The proceeds from the sale of the digital currency go into the wallet of the exchange, but already in fiat currency. The payment can then be made to a debit or credit card or to a linked bank account. To safely and quickly sell Bitcoin, you can use the services of the WhiteBIT exchange BTC USDT.
Whatever exchange platform you choose, you need to follow the next algorithm:
- Select the exchange on which you want to sell your Bitcoins;
- Fund your account with the desirable amount of coins from your wallet. The same amount will be put up for sale;
- Go to the “Sell Cryptocurrencies” section;
- Form an order. The transaction, depending on the exchange and its peculiarities, can be done immediately at the market value or, if you use trading services, you can set the amount for which you want to sell Bitcoins, and wait for the market price to reach the specified value;
- The exchange then controls the sale of the Bitcoins and credits the currency to the user’s account on the exchange;
- Withdraw money from your account.
In comparison to other platforms, exchanges offer more liquidity, which allows you to sell Bitcoins at a better market price. P2P platforms in particular offer sellers a lower price than the exchange.
Selling Bitcoins on P2P exchanges
P2P are platforms for interaction between buyers and sellers without the help of any intermediaries. This platform acts as a guarantor of fair peer to peer transactions and organizes the appropriate infrastructure for trading. With these platforms, cryptocurrencies can be traded directly and without the involvement of third parties. Commissions are usually minimal, may be non-existent or charged only on one side of the transaction. Peer-to-peer P2P exchanges are a necessary evolution of the concept that removes some of the limitations of traditional exchanges for Bitcoin trading. Online exchanges have been the primary means of exchanging cryptocurrency throughout Bitcoin’s existence.
Peer-to-peer exchanges, in most cases, don’t require an ID or identity verification (KYC) process. If it used to be a benefit for supporters of anonymity, nowadays ordinary users pay attention to it.
Direct transactions take longer than in the case of automated exchanges. You will have to conduct the transaction manually, and you must be prepared to do so in a timely manner.
Personal data of P2P exchanges users is protected and not subject to disclosure. This approach also prevents regulators from linking certain transactions to a specific person or country. For this reason, peer-to-peer platforms have been accused of aiding and abetting fraudsters, but now avoid penalties for ordinary users.
In case you don’t feel comfortable selling your Bitcoins online, you can use a Bitcoin ATM. Bitcoin ATMs are internet-connected machines that allow you to deposit cash in exchange for Bitcoins, which are issued as a paper check or by transferring money to a public key on a blockchain. They are similar to traditional ATMs, but Bitcoin ATMs are not connected to a bank account, but to a cryptocurrency wallet.
It is fair to say that Bitcoin ATMs are far less accessible than online cryptocurrency exchanges. Because they are placed in a specific location, as opposed to just using a computer or smartphone which is connected to the Internet from any location. Additionally, such ATMs are usually only available during working hours, which is significantly less than online exchanges.
Choosing a strategy: the right move for trading cryptocurrencies
The cryptocurrency market differs from financial, commodity and stock markets in its high volatility and high profit potential.
«Buy and hold»
The history of Bitcoin price shows predominant growth since the first transaction in 2009. And 10 years later – in 2019 – the price was already holding around $7,000 per coin, and at the time of writing, in 2022, the price of Bitcoin is $19,838. The logical conclusion is that an investor’s “buy and hold” strategy is fully justified. The choice of instruments should be diversified and include a portfolio of the top ten digital currencies.
This strategy is suitable for investors looking several years ahead. If you are convinced that cryptocurrencies have a bright future and that blockchain technology will develop rapidly and continuously, you can wait for prices to rise by including several promising cryptocurrencies in your portfolio.
Cryptocurrency exchanges are connected to terminals for active intraday cryptocurrency trading. In the context of long-term trading strategy, medium-term and even short-term daily scalping is ultra-short-term. The essence of this strategy is to make a profit on the difference between the price of supply and demand. The trader performs a large number of transactions per unit of time, constantly buying at the bid price and immediately placing sell orders at the bid price. This strategy is popular with both experienced and novice traders. The strategy can be applied to any cryptocurrency security. However, it requires the market to be calm to avoid large spikes and breakouts. If a breakout occurs, it can negate any scalping gains made in the previous period.
The dynamic growth of the digital market allows for another strategic option: speculative buying. Because of the high volatility, technical indicators, which are often used for speculation, give many false signals. That is why it makes sense to use Bitcoin prices as an index or benchmark for other altcoins. The speculative buying strategy is based on an analysis of the top 20 market capitalizations at each new Bitcoin peak.
The purpose of arbitrage is to buy a token on one exchange at a certain price and sell the same token at another exchange at a higher price. Due to the fact that transactions on exchanges occur all the time, there are often situations where the value of the same asset on different exchanges differs, sometimes very noticeably. And since the number of cryptocurrency exchanges and cryptocurrencies themselves today amounts to hundreds and thousands, there are many such arbitrage situations to obtain a stable income. This strategy has been and continues to be actively used in traditional stock and currency markets.
The value of this strategy is due to the fact that it does not depend on the direction of the market, but requires the trader to constantly monitor prices on various exchanges. Also, one should not neglect transaction costs and remember that arbitrage transactions are profitable if the difference in prices on different exchanges is at least 1 percent, which is not so rare.
Should you sell Bitcoin now?
In fact, the value of Bitcoin increased significantly during 2021, reaching a peak of over $67,000. This means that if you bought Bitcoin at the beginning of the year, you will end up getting a good profit on your investment. In 2022, however, the coin’s price dropped and is now around $19,000. Because of the constant price fluctuations, it is difficult to predict highs and lows. As you know, the ideal scenario for trading financial instruments is to buy when the price is low and sell when the price is high.
From this we can conclude that you shouldn’t sell Bitcoin if you bought it at a high price. The price may rise in the future, giving you a chance to get your money back for your purchase. Whether you should trade Bitcoin ultimately depends on your particular situation and your risk appetite.
It’s already quite obvious how to sell Bitcoins, where to do it and what to be cautious about. You should always be careful with fraudsters, but if you use trusted sites, the likelihood of problems is quite low. Bitcoin is much better known and more widespread today than it was a while ago. However, mining the coins is still difficult, and it can be even harder to trade Bitcoins for fiat currency. And we hope that our article has helped you understand how to trade Bitcoins in the best way possible.