Author:
hannah
Last Updated on:
16.01.2025
Table of Content
Understanding Bitcoin
Bitcoin is the most popular cryptocurrency on the market at the moment. It is a type of digital currency, so it doesn’t actually exist in the physical form, but transactions like buying or selling are all done virtually. Like Bitcoin, other cryptocurrencies are increasing in interest, including Cardano, Dogecoin, and the second most popular crypto, Ethereum.
Whether to buy or sell Bitcoin, every transaction you make with the cryptocurrency is recorded on the blockchain system. The blockchain is a growing list that shows every record of crypto transactions that has been made over several computers on a peer to peer or P2P network. But because cryptocurrencies work in a decentralised way, the user’s identity will remain anonymous; only their transaction data and timestamp will be visible.
At the start of 2021, Bitcoin was increasing in value as Tesla CEO and SpaceX founder Elon Musk planned that Tesla vehicles would accept Bitcoin as a form of payment. However, this statement was then taken back in May of this year as Musk states he wants to find crypto that is a greener option and doesn’t use up as much fossil fuels as Bitcoin does in Bitcoin mining.
With this news and the recent developments with the Chinese government no longer allowing Bitcoin to be used as an authorised form of payment and banning Bitcoin mining facilities, it caused a severe crypto crash towards the end of May. However, regardless of the downfall, Bitcoin and other cryptos continue to grow upward, with predictions to reach new records by the end of this year.
Cryptocurrency Exchanges
Crypto exchanges are used to buy, sell and hold your cryptocurrency. They have their own online digital wallet on the platform for you to store your funds. In addition, there are many online brokers to choose from that specifically focus on cryptocurrencies and allow you to purchase and trade. These exchanges are used to sell cryptos like Bitcoin.
P2P options on some online exchanges like on Binance offer a service that allows you to request to buy or sell crypto anonymously also. You can then browse through the listing of buy and sell offers and choose the one that matches what you’re looking for.
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Cryptocurrency Wallets
Different types of crypto wallets vary from security levels and mediums; these range from paper, hardware and software wallets. There are ‘hot’ and ‘cold’ wallets where hot wallets use an internet connection to stay online. In comparison, cold wallets are more secure because they are offline. They are at a lesser risk because they don’t need to be connected to the internet, so they aren’t involved in that ecosystem.
Hot wallets are more susceptible to hacks and viruses because they are online. But that does come with the risk of buying and selling crypto. They also generate the private keys you need to access your crypto, so it’s essential to have a safe internet connection and not to share this key or information.
Cold wallets like hardware wallets or paper wallets have a better chance of your funds remaining uncompromised. Hardware wallets come in the form of a device that is like a USB. You can store your private keys offline, and with some more advanced wallets like the Ledger Nano X, they come with software that allows you to monitor your crypto while offline.
Bitcoin wallets
As we mentioned, crypto exchanges do provide you with an online digital wallet. However, if you wanted a wallet that was specifically suited for Bitcoin, then we have included a few examples below.
The Electrum Bitcoin wallet is one of the earliest wallets entirely designed for Bitcoin transactions. Electrum has been around since it started in 2011 and has many years of experience. Its longevity has shown how reliable of a wallet it is, and it has had few changes made since it was first released, which proves its design and user interface are trustworthy also.
Electrum also allows you to choose the security level you want your Bitcoin wallet to have. The measures include multi-signatures and two-factor authentication logins. Even though this is considered a hot wallet because you are connected to the internet, you have the option to store your Bitcoin in cold storage, meaning it can go offline protected by your private and public keys. The only downside would be that this wallet is best suited for more experienced traders due to its complexity and not having any customer service support to assist you if you are a beginner.
Mycelium is another Bitcoin-only wallet. Similar to Electrum, it is a hot wallet that uses an internet connection, but the downside is it is only available on a mobile device. However, this can be seen as a plus to individuals because a lot of people prefer to use their phones over computer devices. It’s more efficient to carry around and easier to access your cryptos on the go. It has a simple mobile-friendly interface and includes a built-in exchange similar to Coinbase to assist in selling Bitcoin.
Selling Bitcoin
To sell cryptocurrency, you will need to use an online exchange platform. If you’re unfamiliar with online brokers or want to practice before using real money, we at Crypto Parrot offer a curated simulated trading platform. We specialise in providing you with the tools to learn how to sell cryptocurrency without investing first. With our demo version, we allow you to practice buying and selling crypto to develop your skills.
Below we have included a general guide on how to sell Bitcoin or any other cryptocurrency in a few steps.
Choosing an online exchange
The simplest way to turn your Bitcoin into fiat money is through an exchange platform. Several online exchanges already allow you to buy, sell and hold crypto. Some familiar platforms include Coinbase or Bitfinex, but it’s essential to look at which option is the best for you to sell Bitcoin.
When creating an online exchange account, you will register your personal details and email address. Although some platforms will allow you to remain anonymous, all regulated exchanges will use a know your customer (KYC) process to identify the individual using the exchange.
Inputting your payment method
Once you’ve created the account, you can link a payment option. Most online exchanges will allow you to use a credit or debit card as well as connecting your bank account directly. There may also be the option to use PayPal to trade or other bank transfer methods also. When that is set up, you will have the option to buy the cryptocurrency of your choice.
Purchasing crypto
Once you’re all set up, you can purchase cryptocurrencies. The transaction is usually relatively quick, and once completed, you will see the funds appear in the digital wallet provided with the exchange.
We recommend looking into separate crypto wallets for more added security to have the greatest control over your funds, whether you are holding, buying, or deciding to sell Bitcoin. Most online exchanges will charge you fees when trading. These come in the form of deposit charges and withdrawal fees. But there also may be buying and selling fees, so it’s essential to look into which exchange has the best rate for you and what you want to do with your cryptos.
Digital currencies like Bitcoin are highly volatile due to their constant movement in the market. With the outside influence of famous figures and popular trends, they also play a part in how many people are engaging in the crypto market and when to tell people to buy or sell what they have, intending to make a profit.
Time to sell
In the online exchange you have chosen, there will be an option to sell the cryptos you are currently holding in your wallet. For example, on the Coinbase wallet, when you click on the cryptocurrency you want to sell, there is an option to ‘Sell crypto for cash’. It will allow you to enter how much money you want to receive in your fiat currency, like GBP, and preview a conversion for you. It will then show you how much money you will be receiving and the selling fees too. Once you confirm the amount, the transaction should be almost instant. From there, you can withdraw the money into your bank account or continue to hold the fiat money in the online exchange.
Risks
As we know, cryptocurrencies are highly volatile assets, so your capital is at risk. Therefore, we thought it would be good to mention other risks you should consider when buying and selling Bitcoin.
Lack of security
When you’re choosing an online exchange, it’s good to make sure it’s a reliable platform. Check the reviews and what their security measures are in the case of a hack or virus attack. Similarly, with a crypto wallet, not all of them have customer support, so if you have any issues and want to communicate with someone, consider wallets that put the customer as a priority.
Lack of regulation
Because cryptocurrencies trade through a decentralised network, there is no way for banks or governments to trace who is doing what transaction where. As a result, many individuals who trade cryptos find this anonymous style of trading good, but it also comes with a lot of trust from the exchanges and wallets you use.
Only works with technology
Cryptocurrencies are entirely digital, so they only work in the technology ecosystem. However, the future of currency is predicted to be digital, so it can be seen as a positive to get a head start. Although digital adoption is slowly coming to fruition, there is still a long way to go until cryptocurrencies will be viewed as a legitimate form of payment around the globe.
Conclusion
We at Crypto Parrot know that buying and selling Bitcoin and other cryptocurrencies may seem complex at first to beginners. But once you’ve practised and developed your skills, the process is relatively straightforward, in addition to the guidance from our expert trading advice and advanced demo exchange platform. Here at Crypto Parrot, you can build your understanding without having to spend real money while you learn.
Cryptocurrencies will always have volatility. So knowing when the right time to buy, sell or hold is imperative. We would like you to gain the experience, so you’re confident to sell your Bitcoin when it is the right time.
Compare the best Bitcoin trading platforms
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Sell Bitcoin FAQ
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