How to Sell Bitcoin for Cash – A Step-by-Step Guide

As cryptocurrencies gain popularity and wider adoption, selling Bitcoin has become increasingly accessible. Various options are now available to help users convert their crypto holdings into cash, each designed to meet different needs and preferences.

Selecting the right method for selling Bitcoin depends on factors such as convenience, control over funds, transaction fees, and the level of anonymity required. This article will guide you through the different methods, highlighting their features, advantages, and drawbacks to help you make an informed decision.

Bitcoin ATM Sell Charges Calculator

Here, you can calculate any sell charges for any BTM service provider:

Key Takeaways

• Selling Bitcoin for cash can be done through cryptocurrency exchanges, peer-to-peer (P2P) marketplaces, Bitcoin ATMs, or brokers.
• Exchanges offer high liquidity and security but require identity verification and charge fees.
• P2P platforms provide privacy and direct transactions but come with scam risks and limited customer support.
• Bitcoin ATMs are convenient and fast but have high fees and may require identity verification.
• Brokers offer professional services and strong security but also have high fees and verification requirements.
• Each method has its pros and cons, so choose based on your priorities like convenience, security, and privacy.
• Research and compare options to find the best method for your needs.

Sell Bitcoin on a Cryptocurrency Exchange

Cryptocurrency exchanges are convenient platforms for trading Bitcoin.

When selling Bitcoin, exchanges act as intermediaries, managing both sellers’ and buyers’ funds.

This way, you can access cash directly from the exchange by transferring your Bitcoin.

Another option is to turn your BTC into a stablecoin in the exchange.

Notably, stablecoins are digital assets pegged to the value of fiat currencies like the U.S. dollar, which offer a means to exchange BTC for cash directly.

Some of the top stablecoins in the market are USDC and USDT.

Centralized exchanges such as Coinbase, Binance, Crypto.com, and Kraken provide easy-to-use platforms for straightforward cashing out.

Notably, crypto exchanges have become quite popular over the past few years due to their convenience, transparency, and security for trading crypto.

A graph showing the top crypto exchanges and record high spot volume change between February and March 2024

Choosing the Right Exchange

Selecting a reputable and reliable exchange is important for selling Bitcoin safely.

Features to consider include:

• Robust Security Features: Look for exchanges offering two-factor authentication (2FA) to enhance fund security.
• Intuitive User Interface: Opt for exchanges with user-friendly interfaces for easy trading and account management.
• Strong Security Track Record: Prioritize exchanges with a proven history of safeguarding users’ funds against security breaches and hacks.

Step-by-Step Guide

1. Start by researching various cryptocurrency exchanges to find one that supports selling Bitcoin for cash. Consider factors such as fees, supported payment methods, and security features to ensure you select a reputable exchange.
2. Create an account: Once you’ve chosen an exchange, create an account on their platform. Provide the necessary information, such as your email address, username, and password, to set up your account.
3. Verify your identity: Some exchanges may require you to verify your identity before you can start trading. This often involves submitting identification documents such as a driver’s license or passport. Follow the exchange’s instructions to complete the verification process, which may take some time, depending on their policies.
4. Set up two-factor authentication (2FA): This additional layer of security helps protect your account from unauthorized access by requiring a second form of verification, such as a code sent to your mobile device.
5. Transfer Bitcoin to your exchange wallet adress: Once your account is set up and verified, you’ll need to transfer your Bitcoin to your exchange wallet. Follow the exchange’s instructions for depositing cryptocurrency, which typically involves generating a wallet address and sending your Bitcoin to that address.
6. Choose a payment method: Before placing a sell order, decide on the payment method to withdraw the cash from your Bitcoin sale. Options may include bank transfer, PayPal, or other payment methods the exchange supports.
7. Place a sell order: On the exchange’s trading platform, navigate to the section for placing orders. Specify the amount of Bitcoin you want to sell and set the desired price per unit. Once you enter this information, submit your sell order to the exchange.
8. Withdraw cash: After your sell order is filled, the proceeds from your Bitcoin sale will be credited to your exchange account. To access the cash, initiate a withdrawal from your exchange account using your chosen payment method.

Pros

• Crypto exchanges offer high liquidity, enabling large trades without significant market impact.
• They employ robust security measures to protect users’ funds.
• These platforms usually accept various payment methods, including bank transfers and cash.
• Many exchanges provide market analysis tools and charts to aid users in making informed trading decisions.

Cons

• Trading and withdrawal fees on exchanges can be relatively high, especially for frequent traders.
• Users must undergo identity verification, compromising their privacy.
• Reliance on the exchange’s uptime and security practices exposes users to potential risks.

Selling Bitcoin on a Peer-to-Peer Marketplace

Peer-to-peer(P2P) selling has two different variations: Online P2P selling and face-to-face selling. Here is how they work:

Online P2P Selling

Numerous specialized platforms and products from reputable cryptocurrency exchanges facilitate online peer-to-peer Bitcoin sales.

These platforms enable users to trade Bitcoin for cash or vice versa with other parties online.

Typically, Bitcoin buyers post listings on these platforms indicating their desired price and preferred payment option.

Interested parties browse listings and select the party they want to transact with on the platform.

Escrow functions are common on these platforms, offering security for both parties and facilitating asset transfer.

Sellers may receive payments directly to their bank account or card, via wire transfer, or through popular traditional payment platforms, depending on the chosen payment option.

On Binance P2P, for instance, after agreeing to a trade, the platform escrows the crypto until the seller verifies receipt of payment.

Similarly, on Paxful, sellers set their rates and can choose from various payment methods.

Face-to-Face Transactions

Another method involves selling Bitcoin peer-to-peer at in-person locations.

Some online platforms facilitate in-person BTC sales for cash.

However, there is also the option of individuals arranging meetups with friends or family to sell Bitcoin offline.

Conducting in-person Bitcoin sales requires familiarity with sending Bitcoin and using a cryptocurrency wallet or platform.

Given Bitcoin’s fluctuating value, sellers must know its price at the time of sale.

Many traders reference rates from prominent exchanges to get the latest price information.

In certain regions, physical locations or shops allow participants to exchange Bitcoin for physical currency or vice versa.

It’s important to note that Bitcoin may trade at different prices across exchanges and regions, resulting in price discrepancies known as premiums.

Exercise caution when organizing in-person Bitcoin sales with strangers, as with any other offline financial transactions.

Step-by-Step Guide

1. Choose a reputable P2P marketplace. Research and select a trusted peer-to-peer marketplace based on factors like user reviews, available payment methods, and escrow services.
2. Create an account. Register on the chosen platform by providing the required information.
3. List or browse listings. Create a listing to sell your Bitcoin for cash or browse existing listings to find a suitable buyer. Consider the buyer’s reputation, transaction history, and offered price.
4. Negotiate terms: Initiate a conversation with the prospective buyer to negotiate terms such as the price and payment method until a deal is agreed upon.
5. Use escrow service. Ensure the platform offers an escrow service to secure the transaction. Escrow services reduce the risk of scams by holding Bitcoin until the payment is confirmed.
6. Deposit Bitcoin to escrow. Transfer your Bitcoin to the platform’s escrow service according to their guidelines for cryptocurrency deposits.
7. Receive cash from the buyer either in person or through the agreed-upon payment method.
8. Confirm payment. Once the cash payment is received and confirmed, release the Bitcoin from escrow to the buyer’s wallet.

Pros

• Peer-to-peer platforms facilitate direct transactions between individuals, preserving privacy.
• They often support various payment methods, including cash and alternative options.
• Users can negotiate rates directly with each other, potentially securing better deals.
• These platforms foster communities where users can discuss trades and share experiences.

Cons

• Transactions on peer-to-peer platforms involve trust between peers, increasing the risk of scams or fraud.
• Limited or non-existent customer support leaves users vulnerable in case of disputes.
• Liquidity can be limited, depending on the platform and location, making it challenging to find suitable trades.
• Some platforms may face regulatory challenges in certain jurisdictions.

Sell Bitcoin Using a Bitcoin ATM

A line graph showing the number of Bitcoin ATMs rate over time in the United States

Bitcoin ATMs resemble traditional cash machines, but they operate differently.

Instead of linking to a user’s bank account, they are internet-connected devices designed to facilitate Bitcoin transactions.

In its simplest form, a Bitcoin ATM allows users to scan a wallet QR code and sell BTC for cash.

These ATMs are scattered across the globe, with their locations easily searchable online.

Some Bitcoin ATM providers may require users to have an existing account for selling operations, and the registration process can be intensive.

For instance, new users may need to provide a telephone number for activation and notifications, a government-issued ID, a palm scan, and a current photo taken by the ATM’s camera.

While the identification process varies depending on the machine and operator, identity verification is always necessary for selling Bitcoin.

Furthermore, BTC ATM operators must align their machines with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations in their jurisdictions.

In some countries, this entails obtaining a money transmitter license, while in others, current regulations restrict Bitcoin ATM installations altogether.

Step-by-step guide

1. Visit the CoinTime Website: Navigate to the CoinTime website using your preferred web browser. Alternatively, you can access CoinTime services through mobile devices by downloading the CoinTime app from the Google Play Store or the Apple Store.
2. Locate Nearest ATMs: Type in your current location on the CoinTime website or grant access to your device’s location to conduct an assisted automated search for CoinTime Bitcoin ATMs near me.
3. Initiate Selling Process
4. Welcome Screen: Upon reaching the CoinTime Bitcoin ATM, you’ll see that the welcome screen offers various options. Select the “Sell Bitcoin” prompt to begin the selling process.
5. Identity Verification: Follow the prompts to provide the necessary details for identity verification. This may involve confirming your phone number via call or scanning your ID using the ATM’s camera.
6. Scan Your Wallet: Using your smartphone wallet app, the ATM will prompt you to scan its QR code. Open your Bitcoin wallet app, navigate to the menu allowing Bitcoin transfer, and select the option to scan the QR code. Hold your phone next to the ATM’s scanner to scan your wallet’s QR code.
7. Enter Amount: After scanning your wallet’s QR code, input the amount of Bitcoin you wish to sell using the ATM’s touchscreen or keypad.
8. Review and Confirm: Carefully review the transaction details on the screen before proceeding. Once confirmed, note that blockchain transactions cannot be reversed.
9. Bitcoin Transfer: Upon confirmation, the ATM will generate a new Bitcoin address. Initiate the transfer of the specified Bitcoin amount to this address from your smartphone wallet. Provide the ATM with your designated Bitcoin address to complete the transaction.
10. Transaction Completion: After initiating the Bitcoin transfer, wait for confirmation on the blockchain, which may take a few minutes depending on network congestion. Once confirmed, the ATM will dispense the corresponding cash amount.
11. Collect Cash and Confirm: Retrieve the cash from the ATM and ensure that the transaction is complete before leaving the ATM premises.

Pros

• Bitcoin ATMs provide a convenient way for users to buy or sell Bitcoin in physical locations.
• Some ATMs allow users to transact without extensive identity verification, preserving anonymity.
• Transactions are usually processed quickly, enabling users to access funds immediately.
• ATM interfaces are often intuitive and easy to use, even for beginners.

Cons

• Bitcoin ATMs often charge high fees, including transaction fees and exchange rate markups.
• Availability may be limited to specific regions, making it inaccessible for some users.
• ATMs can be targets for theft or tampering, posing risks to users.

Use Your Broker to Sell Bitcoin

If your broker holds your cryptocurrency, the simplest approach is to use their platform for the transaction.

For instance, if you’re a client of Robinhood or Webull, both of which offer crypto trading services, executing a trade on their platform would be the most straightforward option.

Once the trade is completed, you’ll have the cash in your account.

Furthermore, with the introduction of spot Bitcoin ETFs in 2024, investors now have a convenient method for buying and selling Bitcoin within a familiar framework.

These ETFs trade on exchanges and are accessible through most brokers.

In addition, the expense ratios on several funds are lower compared to what you might incur when trading on a cryptocurrency exchange.

Step-by-Step Guide

1. Choose your broker and open an account. Select a reputable broker that offers cryptocurrency trading services and open an account with them. Ensure the broker supports Bitcoin trading and provides the option to withdraw funds to your bank account.
2. Transfer your Bitcoin from your personal wallet to the wallet provided by your chosen broker. Follow the instructions provided by the broker for depositing Bitcoin into your account.
3. Select the proper account. Since brokers offer trading of various assets and commodities, ensure you choose the appropriate account that allows you to sell Bitcoin. Navigate to the trading section or dashboard of your broker’s platform to confirm.
4. Set up your trade. Once you’ve accessed the trading section, set up your trade by selecting the type of order you’d like to place. You may choose from options such as market orders, limit orders, or stop orders, depending on your preferences and market conditions.
5. Execute the sale. After setting up your trade, execute the sale by confirming the details and placing the order. Once the sale is executed, your Bitcoin will be exchanged for cash at the prevailing market price.
6. Withdraw your funds. Once the sale is complete and your account reflects the cash proceeds from selling Bitcoin, you can initiate a withdrawal to your linked bank account. Follow the withdrawal process provided by your broker to transfer the funds securely.

Pros

• Brokers often possess market expertise and can guide you on the trading strategies.
• Brokers may offer personalized service, including dedicated account managers.
• Reputable brokers implement strong security measures to safeguard clients’ funds.
• Rates can be negotiated based on market conditions and client preferences.

Cons

• Brokerage fees can be significant, especially for premium services or large transactions.
• Users rely on brokers to execute trades on their behalf, which may introduce counterparty risk.
• Identity verification is required, compromising anonymity.
• Brokers may have limited availability or operating hours, potentially causing delays in executing trades.

Wanna have direct transactions with high limits through a fast and secure system? Learn more with our Bitcoin OTC Full Guide

Comparison Table

Feature	Crypto exchange	Peer-to-peer platform	Bitcoin ATM	Using broker
Privacy	Moderate, as exchanges often require KYC (Know Your Customer) verification.	High, as transactions are usually conducted between parties without intermediaries.	Low, as transactions may require identity verification, among other requirements.	High, as brokers often maintain confidentiality and handle transactions discreetly.
Transaction speed	Generally fast, depending on network congestion and exchange processing times.	Varies depending on agreement between peers and payment methods.	Fast, usually completing transactions within minutes.	Variable, depending on broker processing times and market conditions.
Verification requirements	Typically high, involving identity verification and sometimes additional documents to set up the account.	Varies depending on individual user preferences and trust levels.	Low to moderate, depending on the ATM’s location and regulations.	Moderate to high, as brokers typically require KYC verification.
Fees	Can range from moderate to high, including trading fees and withdrawal fees.	High but varies depending on platform and negotiation between peers.	Fees are often included in the exchange rate and they range from 0% to 17%.	High fees include brokerage fees and possibly additional charges
Security	High, with exchanges employing various security measures like two-factor authentication and encryption.	Often low due to peer trust but varies depending on platform security and user discretion.	Quite high, with physical security measures in place at ATM locations.	Moderate to high depending on broker’s reputation and security measures
Convenience	Easy-to-use, readily available platforms	Requires research to find trustworthy counterparties	Easy to use (if ATM is available)	May require contacting and negotiating with broker
Availability	24/7	Depends on platform/users	24/7	Depends on broker
Limits	High	Varies depending on the platform	Low to High depending on ATM type	High
Market Rates	Competitive	High	Slightly Higher	Negotiable
Geographic Restrictions	Depends on the exchange policy	Varies	Depends on ATM location	Depends on broker policy
Customer Support	Available through platform	Limited or nonexistent	Usually available 24/7 for most providers	Varies depending on the broker
Regulation	Heavily regulated	Mostly low regulation but varies depending on the platform	Regulated in some regions	Mostly low to moderate regulation

Bitcoin ATMs offer fast and convenient cash access for your Bitcoin.

Transactions are typically completed within minutes, making them a good choice for users who need cash quickly.

These ATMs also offer a familiar, user-friendly interface, especially for those comfortable with traditional ATMs.

Final Thoughts

There are various methods for selling Bitcoin for cash, each with its advantages and drawbacks.

Cryptocurrency exchanges offer speed and security but may require verification and charge fees.

Peer-to-peer marketplaces provide privacy but come with higher scam risks.

Bitcoin ATMs offer anonymity but may have high fees and limited availability.

Selling to trusted individuals is fee-free but relies on finding suitable buyers.

To optimize your selling experience, compare prices, review ratings, and prioritize secure payment methods.

Regardless of your chosen method, thorough research and risk awareness are crucial for a successful transaction.