How to sell bitcoin

This article focuses on selling bitcoin into local currency. For options on selling bitcoin into other digital currencies, please see our article How does bitcoin exchange work?

Table of Contents

  1. Overview of the two main options for selling bitcoin
  2. Pros and cons
  3. Why do I need to verify my identity to sell bitcoin?
  4. What are the fees for selling bitcoin?
  5. Selling bitcoin using an exchange service
  6. Selling bitcoin with the Bitcoin.com Wallet
  7. Selling bitcoin on our website
  8. Selling bitcoin on a cryptocurrency exchange
  9. Selling bitcoin peer-to-peer

Overview of the two main options for selling bitcoin

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:

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
  • Full-service cryptocurrency exchanges

(eg. Bitcoin.com Exchange)

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)
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)
  • 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 exchanges work.

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, like the Bitcoin.com Exchange or choose from this list of top exchanges.
  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 digital assets 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.

When selling bitcoin peer-to-peer, it's 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

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