The content of this article is for informational purposes only and should not be construed as financial advice. All views expressed are those of the author(s).
Gateways
When you are considering ways of selling your cryptocurrency, one popular and "safe" option is to use a cryptocurrency gateway. A cryptocurrency gateway is a platform that allows users to exchange fiat money for cryptocurrencies or vice versa.
The gateway will give you an offer, and the offer is typically time-limited and differs negatively from the price you would see on the live crypto market, This is because the gateway needs to make money and it does that by taking a commission for facilitating the sell order. If you accept the offer the gateway will buy up the crypto and you will receive the agreed amount, The gateway either stores the crypto's by itself in an internal wallet or has a third-party exchange deal that takes care of the crypto storage.
It's important to note that when you sell your Bitcoin or other cryptocurrencies, there may be tax implications. If you sell the cryptocurrency for more than you bought it for, you may be subject to capital gains taxes.
Exchanges
Another popular and "safer" option when you want to sell your cryptocurrency bags is to use a crypto exchange. The exchange will typically give you a time-limited offer that is somewhat significantly below the current live market prices, after an ended sale the exchange will most likely keep the crypto as part of their own liquidity.
To sell cryptocurrency on an exchange, the seller will also need to have the cryptocurrency in a wallet that is compatible with the exchange and has no relation to cryptocurrency mixers or other bad events that could have infected the wallets with shady behaviors and therefore have been flagged. You will also most likely need to create an account on the exchange and go through a verification process to ensure compliance with KYC/AML regulations.
There are many different cryptocurrency exchanges available, each with its own unique features and services. Some exchanges only allow trading in a handful of cryptocurrencies, while others offer a wide variety of options. Some exchanges also allow users to trade in fiat currencies, such as USD or EUR, while others only allow trading in cryptocurrency pairs.
You might want to consider facilitating a trade instead of selling, you could do a trade where you trade your crypto for a stablecoin instead of selling directly for cash, this will only cost you the trading fees, The drawback is that you will not receive cash into your traditional bank, one way to combat this would be to use a crypto credit card where you transfer parts of the stablecoin to and you can then freely spend it.
ATMs
Crypto ATMs are electronic kiosks that allow you to buy or sell cryptocurrencies such as Bitcoin for cash or other fiat currencies. These machines are becoming increasingly popular and are increasing heavily in numbers around the globe, they offer a convenient and "safe" way for users to quickly and easily exchange their digital assets for cash.
When you decide to sell your cryptocurrency at a Crypto ATM, you simply need to select the "sell" option on the machine and enter the amount of cryptocurrency you would like to sell. The machine will then display the current exchange rate and the amount of cash you will receive. If you agree with the price and accept the terms, you can then proceed and complete the transaction by scanning a wallet QR code provided by the machine, you then send the cryptocurrency to the machine which afterward spits out cash.
One of the biggest advantages of using a Crypto ATM to sell your cryptocurrency is that the transaction is completed instantly, with no waiting for money to be transferred through the traditional banking system, which in short means you will receive cash in hand just like a regular ATM. It is important to note that Crypto ATMs typically charge quite a heavy fee for their services, which can vary depending on the machine, country, and location.
You must verify the exchange rate provided by the machine is somewhat near the market prices, as they sometimes provide prices that differ tremendously from the actual market prices.
Swaps
When selling cryptocurrency, one way to do it is through a crypto swap for a stablecoin. A swap is a transaction where two parties exchange assets, basically, it involves exchanging one type of cryptocurrency or token for another.
Swapping cryptocurrency can be done through various swapping services found in most crypto products like an Exchange or Wallet, it acts as an instant marketplace for buyers and sellers. When swapping crypto, the seller provides a slippage and the number of cryptos to swap, and the swap service matches them with a buyer in the range of your chosen slippage. The swapping service acts as an intermediary or "middleman", facilitating the transaction and ensuring that it is completed securely.
You need to be cautious and learn about slippage when engaging in cryptocurrency swaps, as they can be costly because of the possible huge percentage gap in the slippage you set when swapping.
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Buying and Selling Platforms
One popular way to sell crypto is through buying and selling platforms like the now-discontinued but legendary LocalBitcoins platform. These types of platforms allow users to buy and sell cryptocurrencies directly with each other, without the need for a centralized exchange or third party, the prices of these platforms have historically been generously larger than the market prices, which is good if you are on the selling end of the transaction and want to make a little extra profit.
When using these platforms, you are either able to sell through the platform which then acts as a third-party middleman, or choose to meet in person with the buyer to facilitate the transaction face-to-face, You will need to choose the cryptocurrency that is for sale, and the area you will be able to show up in.
It's important to exercise caution when using these platforms. While they can provide liquidity and a way to sell crypto quickly, users must be aware of the potential risks involved. It's crucial to only transact with reputable buyers and to use reliable and reputable platforms that exercise strict security measures to protect user funds.
The Crypto Community
The crypto community can be found in various social media platforms like Facebook groups, Reddit Subreddits, Telegram Groups, and Discord Servers. The communities are made up of individuals from around the world who invest, trade and hold various cryptocurrencies. These individuals are often "HODLers" a term that originated from a misspelling of the word "hold" on the famous BitcoinTalk Forum.
When selling cryptocurrency to another person from a community, it is important to find a trustworthy person who has a good reputation this is especially valid if you have no reputation yourself and have to go first.
It is important to keep your skepticism of people and be very vary to prevent yourself from falling victim to a crypto scam, I personally never go first in such trades and would not recommend you to do so either, the best way to do these types of trades is to either let them go first or do a public meetup where you've made sure you can't get easily robbed for you're cryptos or NFTs.
Frequently asked Questions
- Where does crypto go when you sell?
- When you sell your crypto, it typically goes to the buyer who's purchasing it from you. Depending on the platform you use, this buyer might be another individual, an exchange acting as the counterparty, or a broker.
- Do you have to have a buyer to sell crypto?
- Yes, for every sell order, there needs to be a corresponding buy order. However, in most exchanges or trading platforms, there's enough liquidity and action that your sell orders get matched with buy orders almost instantly.
- What if no one buys my crypto?
- If no one buys your crypto at the price you've listed, your sell order remains unfilled. You can either adjust your selling price to meet the current market demands or wait for a buyer to match your price in the future.
- What to do after selling crypto?
- After selling crypto, you can either withdraw the proceeds to your bank account, reinvest in other assets, or simply leave the funds in your exchange or wallet for future use.
- How long do I have to wait after selling crypto?
- The waiting time after selling crypto varies. On most exchanges, trades are executed nearly instantly. However, if you're transferring proceeds to your bank, it might take a few days depending on the bank and the gateway you're using.
- Do you get cash if you sell your crypto?
- Yes, you can convert your crypto into cash, especially if you're using a fiat-crypto exchange. The cash can then be transferred to your bank account or, in the case of using a crypto ATM you will receive cash instantly.
- Do I have to report crypto if I never sold?
- In many jurisdictions, you only have to report capital gains or losses when you sell off your crypto assets (e.g., selling or trading). However, even if you haven't sold, certain events, like crypto mining or receiving crypto as payment, may be taxable. Always consult with a tax professional in your jurisdiction.
- How do I cash out millions in Bitcoin?
- Cashing out large amounts often involves using Over-The-Counter (OTC) desks or specialized services that cater to high net-worth individuals to avoid significantly impacting the market price. Ensure to follow local regulations, "pay any necessary taxes", and ensure the security and privacy of your transactions.
- Can you lose money in crypto if you don't sell?
- Yes, the value of your holdings can decrease if the market price of your crypto drops. While you don't realize a capital loss until you sell, the buying power of your holdings may decrease if you don't sell before the price drops.
