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Depending on what you mean by "exchange", there are many tempting reasons to enter the bitcoin trading world. Having done your research on bitcoins, you might think it has peaked and that if you sell your coins you will now get the best possible profit. Perhaps you are curious about a new cryptocurrency rising and want to exchange some of your bitcoins, diversifying your cryptocurrency portfolio. Or you might just want to get out of the bitcoin game and decide it's time to sell everything.
Whatever your reason, there are ways to sell and exchange bitcoins based on your needs. This is what makes people in the bitcoin world so interesting: if you are not content to extract the bitcoin, spend it or pass it passively in the hope that the price will increase, you can treat it as if it were a stock. If you're trading bitcoin futures, you can even incorporate bitcoins into the literal stock market!
Of course, it can also be a nuisance. Bitcoin sales may require more involvement than simply buying on your phone. And if you thought that other securities were volatile, risky and unpredictable, just wait until you spend an hour monitoring Bitcoin increases and falls. Finding the perfect time to sell is quite difficult with a reliable stock, no less one that goes from around $ 1,000 at the start of the year to more than $ 19,000 towards the end of the same year.
The world of cryptocurrency trading is still quite new. This article is not a recommendation to start exchanging bitcoins. However, if it's something you've already decided that interests you, it's important to know what you're getting and how to do bitcoin trading.
What are Bitcoin CFDs?
When I discussed how to invest in bitcoins, I mentioned bitcoin futures contracts. With these, you could essentially bet on the market and what the bitcoin price will be in the future. These contracts are settled in cash and are certainly a way to negotiate bitcoins. There is also a different kind of derivative that some prefer to use during trading: a bitcoin contract for difference, more commonly known as CFD.
With a CFD, you invest once again where the price of the bitcoin is going, without ever having to download a bitcoin wallet or deal with a bitcoin exchange and potentially fraudulent sellers. Instead, exchange value in bitcoin, going short (betting the price will drop) or going long (betting the price will go up).
People who have been successful using CFDs have done so often because they have traded on the margin, paying a small margin requirement for full value. If your instincts were to pay off and the price of the bitcoin go as you thought, this could mean a strong return from that initial investment. But it is better that you are right; The increase in leverage by a small margin means that losses can become much more than that first investment.
Another important aspect of CFDs: they are done through brokers. You will need to make sure you work with a respected and trustworthy broker who can actually pay you if there is money.
Bitcoin trading via CFD is incredibly risky, even for normal bitcoin risk levels. The wrong move can turn into a crushing loss very quickly.
Bitcoin exchange for other cryptocurrencies
With CFDs presenting such a risk, some might simply decide that it is better to own their own bitcoins. And those who try to trade them as shares still have many options.
Bitcoin has now almost a decade and in its wake there are hundreds, if not thousands of other cryptocurrencies that arose in an attempt to compete with it. Some competitors have become pillars in cryptocurrency news, but no one has yet equaled the value of bitcoins.
If you think that cryptocurrencies are the future, or are just fascinated by one or two details, there are ways to exchange some of your bitcoins for them. You'll need to make sure you have the right bitcoin wallets and use the right bitcoin exchanges, whichever cryptocurrency you choose; they are not all universal in exchanges like bitcoins.
In previous bitcoin articles, we discussed other popular cryptocurrencies on which we could invest, such as Ethereum, Ripple and Litecoin. There are other highly regarded crypts, such as Bitcoin Cash and Dash (each of which has much faster transaction times than bitcoins), which can be taken into account.
Bitcoin holders who use Coinbase as a wallet use their own bank of coins, GDAX, to buy and sell their cryptocurrencies. If you have bitcoins in your Coinbase wallet, GDAX also trades Bitcoin Cash, Ethereum and Litecoin. Go to GDAX and log in with your information. At the top of the page, click on "Select product" and choose the encryption you wish to purchase with bitcoins by choosing BCH / BTC, ETH / BTC or LTC / BTC. On the left side of the page are the options for Market, Limit and Stop. Entering the amount of BTC you want to spend on the Market and pressing Buy allows an immediate purchase at current market prices. Limit tries to order at the specified price or better. A Stop order becomes active after a specified price has been reached and there is a possibility that it is a market order or a limited order.
Bitfinex popular exchange has similar instructions and allows you to exchange BTC with Ethereum, Litecoin and Bitcoin Cash. It actually offers a lot more cryptocurrencies to trade – actually dozens of them. Bitfinex also offers many other options for your orders, such as OCO, alias One Cancels Other – inserting a couple of orders with the knowledge that if an order is completed the other is immediately canceled. Gemini and Poloniex are two other fairly important bitcoin exchanges that allow you to trade for ethereum, while Kraken also offers Dash and Ripple. Trade commissions vary from exchange to exchange.
As always, none of these are recommendations for bitcoin exchanges to be used, but only lists of known ones. Search for the success and security of any exchange you are interested in; many have been hacked before.
Transfer of Bitcoin from Wallet to Wallet
Depending on the wallet you have and the currency you want to trade, you may have to move your bitcoins to another wallet first. It's a bit annoying, but not as uncomfortable as one might assume. Coinbase allows both desktop and phone transfers.
After setting up a new wallet elsewhere, select the Coinbase wallet to send from, click the Submit button (found by clicking on the paper plane in the iOS app or on "+" on Android), enter the quantity of bitcoin to send and e-mail address or wallet to be sent, then confirm details before sending. On your mobile, you can also use the QR code of the other wallet to send bitcoins.
How to sell Bitcoin
Maybe when you want to say you want to exchange bitcoins, you just want to exchange them. You think it has peaked and you will never have a better investment, or you think you could even withdraw now before the losses get worse. Or maybe it's just stressful to watch bitcoin shoot and crash constantly and I just want to use the money again.
Whatever the reason, selling bitcoins is not difficult. Many of the ways you've bought bitcoins double as a place where you can sell it. All the above mentioned exchanges will allow you to sell bitcoins too. Some minor details may vary, but a general list of instructions on these exchanges for the sale of BTC for USD are:
- Click "Sell" on the exchange.
- Specify the portfolio you want to sell the bitcoins and the amount you wish to sell.
- Select where you want to deposit your money; often this is a bank account that you have already linked to your wallet when you first signed up for it.
- Confirm your information before placing the sales order.
The time it takes for the funds to find their way to your bank account will depend on how long it will take for a sale and how much the exchange is occupied during processing.
Direct trading sites such as LocalBitcoins and Paxful directly connect buyer and seller without additional third parties. The buyer deposits money into the seller's bank account and, as a demonstration, the seller can send the bitcoins from his portfolio to the buyer. Some direct trading sites offer other ways to pay or accept money, including gift certificates and gift card codes, PayPal and Venmo.
The idea of not needing a third party exchange can certainly be tempting, especially if you're worried about how safe they are. But direct trade also has many risks. By putting you in direct contact with the buyer, they leave you with the trading method, including potential in-person exchanges, which are incredibly risky to deal with a stranger. Some of these methods can also be annoying, frustrating and time-consuming than their favorite ones, and if a buyer is unreliable, it can take even longer if you end up selling them successfully.
Depending on your preferences on different factors when it comes to selling, you will probably find a way that suits your needs. Be sure to check how bitcoin works before making the sale. You never know where a certain day will be. Or now. Or minute.
