How to Sell and Trade Bitcoin
Whenever the terms ‘selling’ and ‘trading’ pop up, one obvious thought comes to mind – business. Business is not just about profit making even though profit is the ultimate goal. To succeed as a business, there have to be well-laid out strategies to guide the course of the business as it strives to achieve its objectives, and this applies exactly the same way with Bitcoin trading.
Many people have often tried to buy and sell Bitcoin with little success, while others are thriving in the trade. One thing that these successful Bitcoin traders have in common is the fact that they stuck to the best way to trade Bitcoin, which is; having a foolproof strategy.
To add more light to the issue, as far as Bitcoin trading strategies are concerned, it is important to acknowledge the fact that BTC is a market asset just like any other and can, therefore, be influenced by the same psychological and fundamental factors as other financial assets. There is very little financial historical data to warrant the utilization of technical analysis solely as far as Bitcoin is concerned. For this reason, it is of utter importance that Bitcoin traders spend a lot of time studying news and monitoring the market’s reactions to the cryptocurrency. Technical analysis is also quite useful as, in the long run, cryptocurrency trends also exhibit regular and logical patterns.
Trading Bitcoin is a rather straightforward process but this is only true if you are buying – selling Bitcoin is a totally different ball game. The first step is to find a Bitcoin trading partner or a Bitcoin exchange that is willing to pay you a reasonable amount for your coin via whichever method you see fit. There is, however, a little more to it.
How to Cash out Bitcoin Online
You can convert your Bitcoin to USD or any other form of currency that your buyer is willing to give online in any of a number of simple and reliable ways;
a) Exchange Trading
Registering with an online exchange is a great way to sell off your Bitcoin without having to worry about the hassle of setting up the trade. It is not an anonymous method though since you have to verify your identity before you are given the go ahead to trade.
Exchanges simply act as intermediaries between the actual trades hence the need for identity verification. A Bitcoin seller places a ‘sell order’ on the exchange with details on the volume you wish to trade and the type of currency you wish to trade (which is in the case Bitcoin) as well as the price you want to sell each unit at. After all this is done, the exchange now comes in and finds someone who has placed a matching ‘buy order’ and then it completes the transaction on behalf of the traders after which the currency is deposited on the seller’s exchange account. It is recommended to withdraw the funds to your bank account especially if you sold your Bitcoin for fiat currencies.
In many cases, it takes the exchanges an awful long period of time to process your funds in case they run into a few hurdles or are faced with liquidity problems. Bitcoin can also be traded for other cryptocurrencies as well, and there are cryptocurrency exchanges available for just that.
Exchanges are great for trading Bitcoin, but when it comes to storing bitcoins or cash, you are far better off using other risk-free alternatives.
b) Direct Trades
This method also involves identity verification and is offered by quite a number of popular companies including USA’s LocalBitcoins and Coinbase, and UK’s Bittylicious and BitBargain.
To trade on these sites, you have to first register as a seller, which again, requires you to verify your identity. The difference that direct trade has compared to exchange trading is the fact that direct trade acts like a ‘true intermediary’ and only handles contact between traders. Once a seller registers on a direct trading platform, he or she posts an offer that signals an intention to sell. The websites that facilitates the direct trade will then prompt you when a potential buyer is interested in what you want to sell. From there on out, the website only acts as a platform to complete the trade and does not in any way participate in the interactions between the seller and the buyer.
c) Peer-To-Peer Trading
This is a relatively newer development in the Bitcoin trading space, though in many ways it resembles the operation of the other two forms of online Bitcoin trading, that is, it acts as intermediary.
Peer-to-peer trading in Bitcoin is a great way to sell off your Bitcoin not just for cash but for goods as well. Two popular companies in this regard are Purse and Brawker, both of which run websites that are designed to unite two different groups of people who have specific and complementary needs.
To break it down, in most cases, one group usually comprises of people who are interested in buying goods from online stores that do not accept payments with digital currencies while the second group consists of people who want to buy Bitcoin using their credit cards. This is where the peer-to-peer trading market comes in and brings these individuals who have similar needs where one gets to sell Bitcoin in exchange for goods and the other gets to buy Bitcoin using a credit card.
Selling Bitcoin in Person
This form of trading is about as easy as it can get – all you need to do is to scan a QR-code on the buyer’s phone and then they will pay for it upfront with cash. It is practically the best way to trade Bitcoin since in most cases, it will be a random person and it may be a little lengthy since you have to negotiate a reasonable and acceptable price before you actually meet up to do the actual trade. The exchange rate is the key issue here and therefore you should only go for the meet up once you have ascertained that you are not being shortchanged and the amount you are being offered is in adherence with the prevailing market value of Bitcoin.
Regardless of the fact that selling your Bitcoin face-to-face with a buyer is quite easy and still assures users of anonymity and convenience, there are still key security issues that every seller, and the buyer as well, must consider. The choice of meetup location is the first issue you should consider and handle carefully. Bringing company is always a great idea though it is important that the buyer is notified about this.
LocalBitcoins capitalizes on security and allows users to pinpoint trading zones where groups of Bitcoin traders converge to either buy or sell Bitcoin. These are, of course, very safe since every member of these audiences are assessed by other users and the website’s staff to ensure that each and every individual who attends the trading sessions has a great reputation.
Can you exchange Bitcoin for cash at an ATM? Well, now you can, thanks to the recent launch of Bitcoin ATMS. They differ from conventional ATMs in the sense that instead of connecting to your bank account they are connected to the internet so as to facilitate Bitcoin transactions. Even though they are still primarily used to buy Bitcoin, these ATM also allow Bitcoin owners to sell, but this is only for a select number of Bitcoin ATM providers such as BitAccess and Robocoin.
Bitcoin ATMs that support bi-directional transactions have been growing in number at a reasonable rate, especially due to the huge price boom of Bitcoin – soon, we should expect to see a number of them at every street corner.