What can you actually sell cryptocurrency for?
Firstly, as you may or may not know, cryptocurrency isn’t actually considered fiat currency by the Australian government. It is considered property.
As such, it is a commodity that can be sold for one of two things:
- A fiat currency, such as Australian Dollars (AUD$)
- Another cryptocurrency
Why would someone want to sell their cryptocurrency?
There’s many reasons you may consider selling your cryptocurrency.
These could include:
Bills and other expenses
While some predict crypto as the future of currency, this is certainly not the case now. You probably can’t go grocery shopping or pay your gas bill with dogecoin (or any other crypto) just yet. That said, you may opt to sell your coins in order to pay for these expenses.
To generate profit
Like stocks, cryptocurrency can increase in value. If you purchased coin A for $1 at the start of the year, it’s value may increase to $3 by the beginning of May. This could prove to be a very profitable exercise, and you may then want to sell your coins for fiat currency.
Anticipating a dump in value
Again, similarly to the stock market, cryptocurrencies behave in both bull and bear-like manners. If you anticipate a particular coin is about to significantly drop in its fiat value equivalent, you may opt to sell it off before this happens so your portfolio doesn’t lose its value.
So, with the what and why behind us, this leaves the how.
How can you sell Bitcoin? Is it easy?
There are three main ways to sell Bitcoin and other cryptocurrency in Australia.
Selling cryptocurrency through an exchange
This is considered one of the easiest, and most popular, ways to both purchase and sell cryptocurrency. An exchange acts as an intermediary between the buyer and the seller. They hold each party’s funds in the buy and sell process.
To get started selling cryptocurrency through an exchange, you’ll need an account. Reputable accounts should include some sort of identity verification requirement – if they don’t, proceed with caution.
With your account set up, you’ll need to transfer coins from your crypto wallet to your exchange account, and place a ‘sell order’. How this looks on each exchange’s interface may be a little different, but the basic premise is the same. You’ll set the price and wait for an interested buyer. Once sold, the funds will be credited to your account. To access these funds, you will need to transfer to a bank account. Keep in mind, these transfers can be subject to withdrawal fees that will differ between each exchange.
If instead of selling for fiat currency, you’re selling for another currency, you’ll simply transfer the newly acquired currency to your crypto wallet, instead of your bank.
Selling Crypto for Fiat through a Crypto ATM
Another way you may want to sell your crypto is through a Crypto ATM. These look similar to traditional ATMs, but function differently. While most of these machines are built to purchase crypto, some, like Genesis ATMs and General Bytes ATMs, let you sell crypto through them.
You’ll have to complete identity verification at the ATM by providing valid photo identification. The ATM then provides a wallet address to send the crypto to, and from there the seller waits for confirmation. Unfortunately, this can take some time so most ATMs provide a redeem code that can be used to access cash once the transaction is completed.
For the most part, Crypto ATMs are rare in Australia and typically have higher fees than exchanges, but when available they can be convenient.
Peer to Peer Trading To Sell Cryptocurrency
Peer to peer trading, as its name would suggest, is the direct exchange of cryptocurrency from one wallet to another. The buyer will provide their wallet address for the seller to transfer to, and typically the buyer will either pay in cash or do a bank transfer of funds.
For obvious reasons, this can be risky, so be sure you can trust the buyer or seller you’re dealing with. There are several P2P marketplaces and forums online, and some of the more reputable ones provide user ratings.
So, what’s the best way to sell Bitcoin?
For ease and affordability, the best option to sell cryptocurrency in Australia is through an exchange. However, this really comes down to personal preference.
If you opt to go through an exchange, ensure you do your research on any associated fees and, if in doubt, talk to a professional.
Cover image source: Pavel Ignatov/Shutterstock.com