Selling bitcoins is harder than buying. This guide contains all the information you need to successfully sell a cryptocurrency. First of all, the seller must choose the method of transaction - through the Internet or in person. Both methods have their advantages and disadvantages.
Selling bitcoins over the Internet
This way of selling Bitcoins (Bitcoin) is certainly more common. Now there are three possible ways to sell cryptocurrency via the Internet.
- You can make a direct deal with the buyer.
- Bitcoins can be realized through online exchange. In this case, the transaction is with a service, and not with another person.
- New peer-to-peer trading platforms connect Bitcoin owners with people who want to buy cryptocurrency.
Direct deals
Websites specialize in direct deals Coinbase and LocalBitcoins in the US, BitBargain and Bittylicious in the UK.
To sell cryptocurrency, you need to register as a seller on these sites. In addition, identification documents must be provided.
After registration, the user can post his proposal, and then receive notifications from the site when a buyer appears. From this moment, interaction is carried out only between the parties, bypassing intermediaries, and the service provides all the necessary infrastructure to complete the transaction.
Exchange sale
You can also sell bitcoins on a cryptocurrency exchange. For this, you also need to register and provide personal data, but the transaction is easier.
The exchange acts as an intermediary that controls the funds of sellers and buyers. Sellers place an application for sale on it, indicating the amount, currency and its value.
When the buyer appears, the service will automatically conduct the transaction. Cryptocurrency will be transferred from the seller’s account to the buyer’s account, and the seller will receive the money.
The disadvantage of this method is that when selling bitcoins for ordinary money, the amount received will have to be withdrawn to a bank account. If the exchange lacks liquidity or problems with banks, the process of withdrawing money can take a long time.
You should carefully study the service with which you intend to work before transferring money. Examples of online exchanges are Circle, Kraken, and Bitstamp.
In addition, there are exchanges where you can only change digital currencies. This method is used for arbitration purposes or if the store accepts other cryptocurrencies (for example, the Bitcoin Shop now accepts lightcoins and dojcoins as payment for goods).
Examples of such exclusively cryptocurrency services are BTER, CoinCorner and Cryptsy.
Some services charge a fee. For example, BTC-e withholds 0,2% of the transaction amount from the seller. You can compare the size of commissions in various cryptocurrency markets and trading volumes, for example, on the CoinCompare and Bitcoin Charts websites.
Another subtlety is that exchanges limit the maximum size of an account (it can change over time). In any case, it is unreasonable to keep your money in the account of the exchange service, although for speculation this may seem the most suitable option.
You yourself are responsible for your own funds - large amounts should be stored on personal devices or offline, since even the most reliable Internet services may one day be hacked.
Peer-to-peer trading floors
Recently, sites like Brawker and Purse have begun to appear in the bitcoin space. Their goal is to bring people to specific and complementary needs.
These are, for example, people who want to buy products on sites that do not yet accept digital currencies directly. Another class of customers is those who want to buy bitcoins with a credit or debit card. Peer-to-peer platforms unite people with relevant needs and allow one to buy bitcoins, and others to get goods at a discount.
The platform acts as an intermediary, offering users a platform, Bitcoin wallet and escrow for transactions.
Here's how it works:
- Alice publishes her shopping list on a peer-to-peer website, indicating the desired discount (usually up to 25%).
- Bob has a bank card, and he wants to buy bitcoins in the amount corresponding to the value of Alice's goods. He makes a deal with her through the site, buys the required products on Amazon.com and asks them to be delivered to Alice's address.
- As soon as the goods arrive at Alice, she makes a note of this on the site and bitcoins are transferred from the escrow account to Bob’s wallet minus the agreed discount and a small commission on the site.
In this case, Bob pays a relatively high price for his bitcoins, but this allows him to buy digital currency with a bank card.
Problems with the withdrawal of funds. International bank transfers allow you to transfer money anywhere in the world. Most (if not all) online bitcoin exchanges support this method of withdrawing funds. In addition, you can use the services of third-party payment systems.
Verification of personal data. While many of the sites mentioned here almost do not require specific information from buyers, they require confirmation of identity from sellers. Laws do not yet oblige Bitcoin sites to collect personal data, however they do so in a preventive manner in case such requirements arise in the near future.
To simplify the sale of bitcoins, confirm your identity at the registration stage on the site. This step will remove possible barriers to selling when such a need arises.
The site may require scans of two utility bills indicating your name and address, as well as scans of an identity card (passport or driver’s license). Some (for example, BitBargain) may even require a selfie with an open passport in their hands and the name of the site on a piece of paper!
It will be difficult for you to sell bitcoins online if you are afraid to upload such personal information to obscure sites.
Private sale of bitcoins
In many ways, this is the easiest way to implement digital currency. It is enough to scan the QR code on the buyer's smartphone and confirm the transaction.
Selling to friends or family members is easy. Get them wallets, transfer bitcoins to them and take your money.
There are a few things to take care of when selling bitcoins privately.
Discuss the price. Typically, quotes from a well-known exchange or the CoinDesk Bitcoin Price Index are used. Some sellers withhold interest on costs and as a premium for convenience / anonymity. You can use mobile applications such as Zeroblock and BTCreport to calculate prices. You should be aware of local prices. The cost of bitcoins may vary in different countries. Often this is due to the difficulty of buying cryptocurrency for the national currency. In many countries of the world, there are meetings of cryptocurrency fans, at which people trade and exchange bitcoins.
Take care of security. Spend a meeting with a potential buyer in a public place or take a friend to it.
Localbitcoins. You can place your ad on a site like LocalBitcoins. It allows users to rate, so you can estimate in advance the reliability of a potential trading partner. A high reputation allows you to sell bitcoins with a premium. No need to authenticate as on other sites. Again, take care of security in person (this must always be done when meeting strangers from the Internet). LocalBitcoins supports conditional deposits, but they are intended for online transactions and not for personal transactions. Therefore, do not listen to those who require an escrow before a personal meeting.