If you’ve taken the leap and bought some bitcoin, it’s equally important that you know how (and when) to cash out and sell.
In this guide, we’ll walk you through the different ways you can sell bitcoin, as well as the ins and outs of converting your BTC to US dollars or another cryptocurrency.
Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade.
- Log into your account on an exchange like eToro.
- Go to the market for the asset you want to sell.
- Enter the amount you want to sell.
- Check the price and confirm the transaction.
- Review transaction details.
- Click “Sell.”
A step-by-step guide to selling bitcoin
There are two main options available when selling your BTC holdings:
- Selling bitcoin for fiat currency, such as US dollars (USD)
- Selling bitcoin for another cryptocurrency, such as Ethereum, XRP or any number of other altcoins
For many people, the main aim when selling bitcoin will be to cash out for USD, so you can find instructions on how to do that below.
However, if you want to trade your BTC for another crypto, we’ve included a step-by-step guide on how to do that as well.
Selling BTC for US dollars
If you want to sell BTC for fiat currency, here’s an example of how you can do it:
- Step 1. Register on an exchange that lists the BTC/USD trading pair
- As the world’s oldest and most-renowned cryptocurrency, bitcoin is listed on the vast majority of crypto exchanges. However, not all of them allow you to exchange your BTC for fiat currency.
That said, there are a growing number of exchanges that do, so compare the features of a few to find a platform that meets your needs. You can then sign up for an account by providing your email address and creating a password. To satisfy government regulations, most exchanges will also require you to provide your full name, address and proof of ID.
Once you’ve created an account, make sure you enable 2-factor authentication for added security before moving on to Step 2
Step 2. Deposit bitcoin into your account
Before you can sell your bitcoin, you’ll need to transfer it into the wallet of your chosen exchange. This means you’ll need to log in to your exchange account, find the deposit address for bitcoin and then transfer BTC from your external wallet to that address.
For example, if you’re using Coinbase, you can do this by clicking on the “Wallet Address” tab at the top of the screen and selecting your bitcoin wallet. You’ll be supplied with the address to which you can transfer BTC.
Step 3. Sell bitcoin
Once your transfer has been completed, it’s time to click through to the trading page on your chosen platform. You can then search for the currency pair you want to trade, in this case BTC/USD, and enter all the details of your transaction.
On coinbase you’ll need to click the “Sell” tab and select the wallet you want to sell from. Then, select the account you want to deposit to, such as your bank account. Make sure everything on the screen looks correct and then click “Sell.” The money will be transferred to your selected account.
How to choose the best way to sell bitcoin
There’s no such thing as a best way to sell bitcoin for everyone, because what works well for one person might not necessarily be a good fit for the next. Instead, it’s all about working out which option is the right choice for you. You can do this by asking yourself a few important questions:
- Do you want to sell bitcoin for USD or another cryptocurrency?
- How quickly do you want to sell your bitcoin?
- Are you willing to accept a price well below the market rate, or do you want to negotiate the best price possible?
- If selling for USD, how do you want to receive payment?
This should help you decide how you want to sell your bitcoin, and you can then figure out which platform has all the features you need. When comparing your options, make sure you consider:
- Price. How does the exchange rate you’ll get compare to those offered by other platforms?
- Fees. Compare any trading fees that apply and whether there’s a fee for withdrawing funds into your bank account or crypto wallet.
- Trading and withdrawal limits. Is there any limit on the amount of bitcoin you can sell, or on how much USD you can withdraw from your account?
- Security features. Are there any security measures in place to help protect your funds and your private data, for example 2-factor authentication or a reputation system for buyers and sellers?
- Customer support. If something goes wrong with your transaction, how will you be able to contact customer support? During what hours is support available?
- Reputation and reviews. Seek out online reviews and check crypto forum posts from other users to find out whether they’d recommend a particular exchange, trading platform or bitcoin ATM provider.
There are several other important features to consider, such as where an exchange is regulated and the payment methods accepted by peer-to-peer trading sites, so check out our cryptocurrency exchange guide for more tips on how to choose the right platform.
Withdrawing your funds after the sale
Even after you’ve sold your bitcoin, your transaction hasn’t been fully completed. The final step is to withdraw the proceeds of your sale into either your bank account or your cryptocurrency wallet.
If you’ve sold bitcoin through a platform that permits USD withdrawals, check to see what withdrawal methods are supported. Options include:
- Bank transfer
- Credit/debit card
When choosing your withdrawal method, make sure you consider:
- Fees. Many (but not all) platforms impose a withdrawal fee, and the fee charged usually varies depending on the withdrawal method selected.
- Limits. Are there any minimum or maximum limits on how much you can transfer? How do they differ between withdrawal methods? Can you increase these limits by providing additional verification or ID?
- Processing times. How long will it take for the USD to arrive in your wallet or bank account? For example, while cash withdrawals are instant, bank transfers can take several days to arrive.
- Any other restrictions. For example, some exchanges will require you to withdraw funds using the same payment method with which you made your deposit.
Storing your cryptocurrency on an exchange for the long-term is not recommended. Exchanges control the private keys to these wallets and are also popular targets for hackers, so the safest option is to transfer your crypto into a secure wallet that lets you retain ownership of your private keys. It’s a good idea to set this wallet up well in advance of selling your bitcoin, and make sure you double-check your wallet address before depositing any funds.
Once again, check whether there are any limits on the amount of crypto you can withdraw per-transaction or in any 24-hour period. You’ll also need to factor any withdrawal fee into the total cost of the transaction.
When is the right time to sell bitcoin?
Unfortunately, there’s no easy answer to this question.
Timing is crucial to maximizing the success of any trade — anyone who sold bitcoin at or near its ~US$20,000 peak in December 2017 can attest to this fact — but working out the right time to sell can be a tricky task. From crypto regulatory developments and broader economic factors to bitcoin hype levels and even your own appetite for risk, there are many factors that can affect whether you should or shouldn’t sell your BTC.
Analyze the market carefully to decide whether you want to sell or hold. Our guide to cryptocurrency technical analysis is a useful tool to help you better understand and read the crypto market.
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