The best asset of the decade and the most reliable anti-crisis instrument, bitcoin, still raises some questions among investors. And one of the first is "How to sell bitcoin the right way?". After all, there are several factors to consider when selling a cryptocurrency, from the security of the site to the favourable terms.
Why invest in bitcoin?
Bitcoin has advantages over both traditional and digital assets.
Bitcoin's advantages over traditional assets:
greater performance. In 2020, it has shown a growth rate of 300% compared to 23% for gold. Of course, there are also down periods in the cryptocurrency market. However, comparisons over long stretches of the time confirm bitcoin's advantage over gold. In 2013, 1 BTC was valued at 0.1 ounces of gold, in 2016 at 0.4 ounces, in 2019 at 5 ounces and in 2021 at 30 ounces;
crisis resilience. Gold is mixed in the crisis market in 2021, IT stocks are showing momentum and the US dollar is close to its largest decline since the Great Depression. At the same time, bitcoin continues to strengthen its market position, thanks to a supply cap of 21,000,000 BTC - the latter distinguishing it from traditional currencies, whose massive issuance makes it worthless;
flexibility and accessibility. Bitcoin allows for instant cross-border transfers without excessive fees, which distinguishes it from legacy payment systems and especially from tightly regulated gold. The argument that bitcoin is just digits on a screen plays against the proponents of precious metals in this case. The turnover of gold among citizens has been kept to a minimum, and investors who open metal accounts with banks have never seen their bullion.
Bitcoin's advantages over other digital assets:
stability. Bitcoin's capitalisation of more than $1 trillion and the presence of large corporations in the market ensures that the asset will not flee the market. Smaller cryptocurrency assets should be chosen with more caution, as not all are backed by well-known investors and developers;
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minimal volatility. High capitalisation and the involvement of institutional players have also resulted in reduced rate fluctuations and predictable movements.
Overall, both strategies of investing in bitcoin alone or in bitcoin and smaller assets carry their benefits.
How do I sell bitcoin?
After buying bitcoin and waiting for it to rise, an investor may want to lock in a profit - to take advantage of the market situation and sell the asset at a profit. There are various ways to do it, all of them have their advantages and disadvantages.
Sell bitcoin via a p2p platform
Peer-to-peer or p2p trading involves a direct exchange between users. Typically, prospective transactors find each other on specialized message boards.
simplicity. It is sufficient to contact the buyer, send bitcoins to his address and receive fiat currency in return - for example, to a bank card;
Fiat currency is a designation for a government currency, such as the dollar or the euro. The term is used to distinguish between digital and paper money.
low fees. Listing sites charge low fees for transactions on their platforms.
lack of guarantees. The system of reviews and ratings has become common on p2p-trading sites. However, it does not prove to be worthwhile - after a few fake transactions, an anonymous buyer or seller can disappear with the trusted user's funds at any time.
Sell bitcoins via an exchanger
Simplicity is the main advantage of cryptocurrency exchange services. The user only needs to go to the website, select the desired exchange destination and wait for the funds to be credited.
convenient and clear interface. The user-friendly interface and the speed of transaction are the main trump cards of such services. The procedure is fully automated, which means that you can make the transaction at any time of the day.
lack of guarantees. Reviews and ratings of exchangers can be found on special aggregator sites. However, the lack of licences and oversight from the regulators harms the sector. It is not uncommon for unlicensed services to disappear with clients' funds, later returning to the market under a new name.
Sell Bitcoin via an exchange
Most modern cryptocurrency exchanges operate within the law and offer their clients a secure exchange for fiat currency, followed by withdrawal to a bank card.
guarantees. The existence of licenses guarantees the safety of users' funds and their safe withdrawal to their card.
inconvenient interface for beginners. The main audience of exchanges is experienced traders who want to make money from short-term fluctuations in exchange rates and who know how to work with the relevant tools.
Sell bitcoin via an investment platform
Investment platforms operate within a legal framework and also comply with KYC regulations - the latter enhances the security of the platforms, as well as ensuring that users do not receive blacklisted assets - those involved in corruption schemes and other illicit activity.
guarantees. Licenses ensure safe custody and withdrawal of client funds at all times.
Conscientious market participants also pay attention to the technical part, which gives customers an additional guarantee. The security system of the Broex.io investment platform includes three contours, to which employees do not have access. Two of these contain investor funds - these circuits do not communicate directly with each other.
a user-friendly interface. You can buy and sell bitcoins in just a few clicks. No special knowledge is required, and the interface is as friendly as possible to novice users.
the lack of tools for trading. Investment platforms are designed for those who prefer a strategy of long-term holding of promising assets. This approach to investing has its advantages, as it requires less time while reducing risk.
Bitcoin has proven to be the best asset of the last decade and a top-notch tool for risk protection in a volatile global economy.
Further digitalisation and the adoption of decentralised technology by traditional financial institutions are strengthening the cryptocurrency's position.