Overview of the two main options for selling bitcoin into cash

    Your two main options for selling bitcoin into local currency are:

    1. Using an exchange service

      An exchange service is a regulated business that interacts with the traditional banking system. An exchange service may take the form of a simple website with limited exchange functionality, a digital wallet with banking connections, or a full-service cryptocurrency exchange with order book, market makers, etc.

    2. Selling peer-to-peer

      When you sell peer-to-peer, you can bypass the traditional banking system to a certain extent by, for example, taking payment in cash, using a payment app like PayPal, or settling the transaction with goods or services. If you know someone who wants to sell bitcoin, you can buy directly from that person. Alternatively, there are a number of platforms that act as a matchmaking service, helping sellers find buyers and vice versa. Buyers and sellers then negotiate trades on a peer-to-peer basis.

    Pros and cons

    Here's a rundown of the pros and cons for each option:

    Pros and cons of selling bitcoin using an exchange service

    Exchange services can be divided into two groups: 1) simple exchange, and 2) full-service exchange.

    1. Simple exchange services

    (eg. the Bitcoin.com Wallet , the Bitcoin.com Sell website ).

    Advantages

    • Fast, easy, and convenient
    • Guaranteed at or close-to market rates for sells
    • Can sell any amount

    Disadvantages

    • Requires identity verification
    • Not available in all regions
    • Payments made to bank accounts only
    1. Full-service cryptocurrency exchanges

    Advantages

    • Can set 'limit' sells, thereby guaranteeing your specified rate
    • Can sell any amount

    Disadvantages

    • Not available in all regions
    • Requires identity verification
    • Payments made to bank accounts only
    • Custodial (the exchange holds your bitcoin, not you)
    • Relatively difficult to use (for example, requires setting sell orders and understanding order books)
    Pros and cons of selling bitcoin peer-to-peer

    (eg. your friend or a match-making service like Hodlhodl )

    Advantages

    • Identity verification is often not required
    • Any payment method is possible (including cash, payment app, barter, etc.)

    Disadvantages

    • Less convenient (you must manually create and negotiate sell orders)
    • Higher risk of fraud
    • Generally only legal to sell small amounts

    Why do I need to verify my identity to sell bitcoin?

    When you sell bitcoin through an exchange service, you're interacting with a regulated business. Such businesses must comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations. These regulations require the collection and storage of customer information, including identity documents and sometimes proof of address.

    What are the fees for selling bitcoin?

    Fees for selling bitcoin depend on the payment method and platform/venue used. For example, if you're selling directly to a friend and settling in cash, you'll only need to consider the 'network fee' for sending the bitcoin from your digital wallet to your friend's digital wallet.

    Read more: Learn about sending bitcoin, including information of network fees and more .

    If you're receiving cash via bank transfer, you'll of course need to factor in the associated fees.

    Exchange services also charge fees for facilitating trades. These fees cover the exchanges' operating costs plus a small margin.

    Read more: How bitcoin exchange works .

    Selling bitcoin using an exchange service

    Bitcoin.com's recommended options for selling bitcoin using an exchange service are:

    • Selling bitcoin with the Bitcoin.com Wallet
    • Selling bitcoin on at Sell.bitcoin.com
    • Selling bitcoin on a full-service cryptocurrency exchange

    Selling bitcoin with the Bitcoin.com Wallet

    With this method, you can sell any amount of bitcoin (BTC) in your digital wallet directly to cash, which will then be deposited in your bank account. Here's how it works:

    1. On the app's home screen, tap the "SELL" button.
    2. If you haven't done so already, follow the instructions to connect your bank account.
    3. Select the amount you'd like to sell. You can input the amount in either local currency terms or bitcoin terms.
    4. Confirm the transaction.

    Note: it typically takes between 1-3 working days to receive the funds in your bank account.

    Selling bitcoin on our website

    With this method, you'll need to create an account, verify your identity and connect your bank account, then send the bitcoin (BTC) you'd like to sell to a specified Bitcoin address. After the sale is processed, you'll receive cash in your bank account. Here's how it works:

    1. Visit our official Sell Bitcoin page
    2. Select bitcoin (BTC)
    3. Choose the currency you'd like to receive and enter the amount (either in local currency terms or bitcoin terms)
    4. Carefully review the order, then add your wallet address and click Continue The wallet address you provide will be used as the return address in the (very unlikely) event the transaction doesn't go through
    5. Complete the sale process by entering your bank details and sending your bitcoin to the address we provide

    Note: it typically takes between 1-3 working days to receive the funds in your bank account.

    Selling bitcoin on a cryptocurrency exchange

    With this method, you'll need to create an account, verify your identity, and connect your bank account. Once you've sold your bitcoin into local currency, you can withdraw that currency to your bank account. The typical flow is as follows:

    1. Visit a cryptocurrency exchange.
    2. Create an account and verify your identity as required.
    3. Follow the website’s instructions to sell your bitcoin (BTC) or other digital asset.
    4. Withdraw the funds to your bank account.

    Selling bitcoin peer-to-peer

    A variety of platforms facilitate the trading of bitcoin and other cryptoassets by offering 1) a venue for buyers and sellers to post their buy and sell orders, and 2) an escrow and dispute resolution service.

    Since these platforms principally help people find each other, in many jurisdictions they aren't technically classified as exchanges or 'money transmitters,' so in some cases they don't require you to reveal your identity in order to use them. For privacy-conscious buyers, therefore, P2P platforms can be an attractive method for obtaining bitcoin. This means that such platforms typically have no shortage of buyers.

    However, since anonymity is possible on these venues, there's a higher chance of fraud. For example, some people have fallen victim to the so-called "replace-by-fee" scam, where the buyer's wallet shows bitcoin having been received, but in fact the transaction hasn't been confirmed on the blockchain. The buyer will then release funds from escrow, but the "received" bitcoin will then disappear from buyer's wallet display. Read more about the replace-by-fee vulnerability here , and steps you can take to not fall victim here .

    When selling bitcoin peer-to-peer, it's also important to consider the laws in your region. In many regions, if you sell above a defined daily and/or yearly limit, you may find yourself on the wrong side of the law.

    The process for selling bitcoin using a P2P platform is typically as follows:

    1. Either create a listing for the amount of bitcoin you'd like to sell or browse through the listings of people looking to buy.
    2. Initiate a trade. Doing so locks up the bitcoin you'll be selling into an escrow account.
    3. Confirm that the agreed payment amount has been received via the agreed payment method. Note that this could potentially even mean meeting the buyer and accepting cash in person. When you've confirmed payment, the platform will release your bitcoin to the buyer's wallet
    Do I need a license to sell Bitcoin?
    License for cryptocurrency exchange in the USA entitles its owners to operate with exchange of cryptocurrencies. Except crypto exchanges, all other applicants intending to provide payment services are interested to obtain such license. more
    Can grayscale sell Bitcoin?
    Grayscale also offers several other exchange-traded products, tracking Ethereum, Bitcoin Cash and Litecoin among others. more
    Should I sell bitcoin?
    They buy when a cryptocurrency is at a high, sell when the price plummets, and then miss out if the price bounces back. If the price has dropped and you no longer think the cryptocurrency is a good investment, then you should sell. more
    Did Elon sell Bitcoin?
    Tesla's Chief Executive Officer Elon Musk said on the earnings conference call that the company sold the Bitcoin to maximize its cash because of Covid related uncertainty. more
    Do you need a securities license to sell Bitcoin?
    Currently, the only requirements on a federal level for companies that do a substantial amount of business in exchanging or transmitting cryptocurrencies include: Registering with the Financial Crimes Enforcement Network (FinCEN) as a Money Services Business (MSB) more
    Do bitcoin miners sell bitcoin?
    In an unusual trend throughout May, Bitcoin miners actually sold more Bitcoin than they obtained through mining, according to the digital asset analysis firm Arcane Research. more
    Does Amazon sell Bitcoin?
    Well, although you can't actually buy cryptocurrencies on Amazon's website, what you can do is get an Amazon gift card and then sell the card for Bitcoin or another digital coin using a third-party platform that supports this kind of exchanges. more
    Is Tesla sell Bitcoin?
    Tesla CEO Elon Musk said he still owns and won't sell his crypto holdings. Dogecoin, Bitcoin and Ether briefly spiked on Monday after Tesla TSLA +4.88% CEO Elon Musk tweeted that he still owns the cryptocurrencies and won't sell. more
    Does Vanguard sell bitcoin?
    Vanguard customers can purchase any over-the-counter bitcoin or crypto funds, such as the Bitwise 10 Crypto Index Fund (BITW) or Grayscale Bitcoin Trust (GBTC), to name a few. Customers can also buy shares in publicly traded bitcoin mining companies like Riot Blockchain and Argo Blockchain. more
    Does HEB sell Bitcoin?
    H-E-B shoppers can buy and sell cryptocurrency like Bitcoin in Houston stores. Look for Coin Cloud's digital currency machines in some Houston H-E-B stores. Be sure to add Bitcoin to your grocery list. more
    Does Schwab sell Bitcoin?
    Schwab clients with a futures account can trade Bitcoin futures contracts directly. more

    Source: www.bitcoin.com

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