by: ofir beigel | last updated: 9/1/22
People who want to sell their bitcoins for fiat currency (ie dollars, euros, etc.) have several ways to do it online and offline. In the next post, I’ll cover the different selling methods available.
Reading: Where to sell bitcoin
summary of how to sell bitcoins
If you want to convert your bitcoins back to “normal” money, you will need to do the following:
- find an exchange (eg coinmama, cex.io, coinbase)
- send your bitcoins to that exchange
- exchange your bitcoins for fiat
- withdraw the fiat to your account
if coinmama doesn’t work for you, here are some additional recommended exchanges to sell bitcoin:
This is how to sell bitcoins in a nutshell. If you want a more detailed explanation of how to sell bitcoins and learn about a variety of other methods available, read on. this is what i will cover:
- selling bitcoins in a nutshell
- selling bitcoins with paypal
- selling bitcoins with a credit card
- selling bitcoins with a bank account
- how do I sell bitcoins for cash?
- additional ways to sell bitcoins
1. how do you sell bitcoins?
When you feel like it’s time to exchange those precious bitcoins for fiat, there are a few things to think about.
first, how do you want to get paid?
Do you want to receive money in your paypal account? your credit card? your bank account? or maybe you prefer cash?
These considerations will lead you to the second question: which exchange do you want to use?
Different exchanges offer different payment methods, fees and exchange rates. it is important to do extensive market research before choosing the right exchange.
Finally, there is the issue of taxes.
I won’t go into detail about this as it is different for each country. I will just say that it is important to know how your country taxes cryptocurrency sales to understand if and when to report the sale to the authorities.
Some countries have not developed clear guidelines, while others have very strict rules. be sure to consult a cpa in your jurisdiction.
Now that we’ve got the basics out of the way, let me review the various methods you can use to sell bitcoins.
2. sell bitcoin with paypal
One method that people often look for online is how to sell bitcoins and receive funds to their paypal account.
paypal, in general, is not very fond of bitcoin, mainly due to the fact that they cannot provide their customers with chargeback protection for bitcoin transactions (this is why).
Having said that, there are still some solutions that will allow you to sell bitcoins for paypal.
See also: Bitcoin – Mining
The popular exchange currency base (available in 103 countries around the world) allows you to connect your currency base account with your paypal account. Although you will not be able to buy bitcoins this way, you will be able to sell bitcoins on coinbase and withdraw the funds to your paypal account.
This feature is available in the US. US, UK and EU. this is how it’s done:
- sign up for coinbase
- complete your account verification
- go to settings > linked accounts > link a new account button
- choose paypal and login to your paypal account
This is probably the fastest and most convenient method if your country supports it. you can read my full coinbase review here.
if you’re not eligible to use coinbase, you can still find buyers who accept your bitcoins for paypal through localbitcoins.
localbitcoins is a marketplace where buyers and sellers meet and exchange bitcoins for a variety of payment methods, including paypal.
Keep in mind that if you are selling bitcoins for paypal credits, you risk being scammed by a buyer who will file a complaint with paypal saying they never sent you the bitcoins you paid for. you can read my full localbitcoins review here.
here is how to sell bitcoins for paypal on localbitcoins:
- open a local bitcoin account
- go to “sell bitcoins”
- choose a country; Since you won’t be meeting in person, it really doesn’t matter which country you personally choose from. I would go with countries that are more likely to have sellers like the US. USA, UK etc.
- choose “paypal” as payment method
- select a buyer
3. sell bitcoin with credit card
Some exchanges allow you to withdraw funds directly to your credit card. this method is usually faster than a bank transfer, but it is also a bit more expensive.
cex.io, based in london, allows you to withdraw your funds to your mastercard or visa card. the amount you can withdraw depends on your verification, with no limits on enhanced verification accounts.
The fee for withdrawing funds to a card can range from 1.2% to 3%, depending on the type of card. you can read my full cex.io review here.
4. sell bitcoins with a bank account
Probably the most common method of selling your bitcoins would be via wire transfer or some other form of transfer to your bank account (eg sepa, ach, etc.).
Almost all bitcoin exchanges support this method, including coinbase, cex.io, and localbitcoins, which I have reviewed before. here’s a breakdown of a few additional picks.
if you reside within the eu, coinmama gives you the option to sell your bitcoins via a separate transfer. the advantages of sepa are fast and relatively cheap transaction times.
coinmama is considered relatively expensive when it comes to exchange rates. you can read my full coinmama review here.
bitpanda, the vienna-based service, allows you to sell bitcoins and withdraw funds via a bank account or a separate transfer. you can read my full bitpanda review here.
bitstamp is one of the oldest bitcoin exchanges out there. allows you to sell bitcoins and withdraw them through a bank transfer or separately. you can read my full bit stamp review here.
5. how do i sell bitcoins for cash?
To maintain anonymity or just convenience, some people prefer to sell their bitcoins for cash or directly to someone else. if that’s the case, then you have several options.
Bitcoin ATMs are machines that accept bitcoins and dispense cash. Not all ATMs allow you to sell bitcoins, some only allow you to buy bitcoins. some of them won’t even require any kind of identification or verification.
ATMs usually have a restricted limit on how much you can withdraw, but for a small amount, this can be a good option. You can see full coverage of ATMs around the world here.
paxful has been around since 2015 and allows you to find buyers (or sellers) who trade with various payment methods, including cash. this means paxful can locate cash buyers in your area.
I recommend that you only trade by enabling escrow on paxful. I also recommend that you only trade in person in a safe place. good choices are bank lobbies, police station lobbies, and courthouses.
When dealing with a seller for the first time or when dealing with large amounts, it is advisable to choose a location with access controls, metal detectors, security cameras and guards. In general, exercise common sense; Although rare, incidents of theft and fraud have been reported.
You can read my paxful review here.
6. additional methods to sell bitcoins
In this post, I tried to focus on the main methods of selling bitcoins. however, there are many other methods you can use to sell your bitcoins.
for example, skrill, netteller, amazon gift cards and more. most of these options can be found on localbitcoins (you’ll be surprised at the variety).
another option would be to simply exchange your bitcoins for real-life goods you want to buy, such as a car, house, computer, etc.
7. frequently asked questions
is it illegal to sell bitcoins for cash?
It depends on the regulations of your country. Most countries have not banned bitcoin, but a few have (eg China). you can see the legal status of bitcoin here.
how long does it take to sell a bitcoin?
Depending on your payment method, it can take anywhere from 2 seconds to several days. when using methods like paypal and credit cards, the transaction is usually instant (although it may take some time to appear in your account).
electronic transfers usually take longer, since the money has to pass through several intermediary banks before it reaches your account.
can bitcoins be traced?
yes. bitcoin is actually 100% traceable, however it is difficult to know who is the person who has the bitcoins. Simply put, bitcoin is a pseudonym. here is a short video about this problem:
There is no shortage of methods you can use when it comes to selling bitcoins. Keep in mind that irreversible methods, like wire transfers, will almost always offer you better rates and lower fees than reversible methods, like credit cards and PayPal.
The most important question you probably have to ask yourself is not how to sell bitcoins, but when to sell them. trying to time the market to make a profit is an almost impossible task. you can learn a bit more about this in my bitcoin trading guide.
do you know any other method to sell bitcoins? You have a comment or question? leave them in the comments section below.