Should I Sell My Bitcoin?

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Should I Sell My Bitcoin?

HODLing Bitcoin isn’t for the faint-hearted. Period. One minute the prices are in the red zone, the next the price skyrockets shattering known resistance zones and setting new all-time highs.

If you are among the few lucky people who boarded the Bitcoin bus early, there’s a question that’s always lurking on your mind – should I sell my Bitcoin? This guide will explore the answer to this frequently asked question and more.

Emotions aside, please!

Before we dig deep into the world of selling Bitcoin, it’s important to keep emotions at bay. Most times, one is tempted to sell after a blood bath that shatters every support level out there. So always keep emotions away when making a decision such as should I sell my Bitcoin.

Being level-headed when making a crucial decision when asking myself ‘Should I sell my Bitcoin’ has helped me avoid losses that I would have regretted later on.

There’s a golden rule that you should always keep in mind when buying Bitcoin or any other cryptocurrency; ‘never risk more money than you are willing to lose’.

So, does that mean buying crypto is throwing cash away? Not really. The truth is, the crypto industry is still in its infancy stage and there’s still inadequate fundamental technical analysis indicators to present a solid future outlook. Most of the Bitcoin transactions happening are of a speculative nature.

Selling Bitcoin – Pros and Cons

The major perk of selling Bitcoin especially if you bought it at an extremely low price is the high return on investment that you will make.

Selling Bitcoin Graph

Source: Statista

Numbers don’t lie when it comes to Bitcoin. When BTC entered the space in 2011, its price was about $1. In 2017 during the bull run, it hitting highs of almost  $20,000. So, if someone sold their Bitcoin at that point, they would have made a handsome profit.

Another pro of selling Bitcoin is that it removes the endless anxiety that comes with holding this coin. Keeping up with Bitcoin’s volatility is no easy feat. There are many factors that affect the price of Bitcoin, including whale moves that may not be in your control. Thus, for these reasons alone, you will always be asking should I sell my Bitcoin now?

You will constantly wonder whether every new all time high created is the ceiling of the bull run. How far will the Bitcoin price go? Obviously, when you are out of the Bitcoin trade, you won’t be as anxious as someone whose money is oscillating in a Bitcoin exchange somewhere.

On the downside, there are some cons of selling Bitcoin. The major one is selling too soon. You might dispose your BTC and a short while afterwards, the price moons. Sad, right?

The other con is finding the right exchange to sell your Bitcoin. With over 504 crypto exchanges out there and counting, you might be confused about which one is the best to use. Safety, fees and liquidity come into play when choosing an exchange.

Reasons for Selling Bitcoin

As a crypto enthusiast, there are many triggers that can make you want to dispose your Bitcoin. Most of the reasons boil down to risk. They include:

Regulatory risk

In almost every country, there are no clear regulations when it comes to Bitcoin and other cryptocurrencies. While some countries have become tax free Bitcoin havens, most are cautioning their citizens against dealing in cryptocurrencies. There’s also the uncertainty of whether Bitcoin transactions are taxable or not. Bottom line, Bitcoin holds a high regulatory risk.

Mass Psychology Risk

Warren Buffet has often said, when investing, sell when everyone is buying and buy when everyone is selling. In line with that, when should I sell my Bitcoin? When you see so many people buying since that could indicate FOMO (Fear of Missing Out).

This ad promotes cryptocurrency within the EU (by eToro Europe Ltd. and eToro UK Ltd.) & USA (by eToro USA LLC); which is highly volatile, unregulated in some EU countries and the UK., no EU consumer protection. Investments are subject to market risk, including the loss of principal.
This ad promotes cryptocurrency within the EU (by eToro Europe Ltd. and eToro UK Ltd.) & USA (by eToro USA LLC); which is highly volatile, unregulated in some EU countries and the UK., no EU consumer protection. Investments are subject to market risk, including the loss of principal.
This ad promotes cryptocurrency within the EU (by eToro Europe Ltd. and eToro UK Ltd.) & USA (by eToro USA LLC); which is highly volatile, unregulated in some EU countries and the UK., no EU consumer protection. Investments are subject to market risk, including the loss of principal.

Diversify to other altcoins

Apart from Bitcoin, there are many other cryptocurrencies that hold a lot of potential. For example, the price prediction for Ethereum looks promising and it wouldn’t hurt to pour some money into it. Other altcoins such as Ripple (XRP), Dogecoin (DOGE) and Binance Coin (BNB) also look promising.

ETH Graph depicting trends
Source: Capital.com

Why Not Sell Bitcoin?

There are many reasons why the answer to the question, should I sell my Bitcoin might be ‘no’. For starters, the price of Bitcoin has always bounced back. After a Bitcoin halving event, history shows that its price reaches new peaks as the supply of circulating Bitcoins continues to diminish.

Secondly, there’s a surge in the number of institutional investors that are buying Bitcoin. These major firms and global financial players don’t plan to sell Bitcoin in the short run. Moreover, their entry into the Bitcoin scene means that they have carried out extensive research about it and decided it’s a worthy investment.

Let’s not forget the deflationary nature of Bitcoin. Following the global pandemic, inflation especially of the US dollar is inevitable. Since Bitcoin and other cryptocurrencies don’t rely on any central bank, their decentralized nature may be what the world needs to cushion itself from the impact of inflation.

Hopefully the above answers are useful to the question should I sell my Bitcoin.

How to Sell Bitcoin

If you answered yes to the question, ‘should I sell my Bitcoin?’, then here’s how to go about it. Note that the process of selling Bitcoin is quite similar to how to buy Bitcoin. You can opt to do it through an exchange or through cash.

When selling through an exchange, you need to register an account. Once active, you can generate a Bitcoin address on the platform which you can send to the buyer in exchange for your funds. Alternatively, some platforms such as Binance and Coinbase allow you to sell Bitcoin and withdraw funds using fiat methods.

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For cash transactions, you can use peer to peer trading platforms such as Local Bitcoins that has sellers within your location who accept cash in exchange of Bitcoin.

Strategies and Tips of Selling Bitcoin

Disposing your Bitcoin is a major move especially when you are selling at a premium price. Let’s indulge you in a few strategies and tips that will come in handy during your sale.

  • Partly sell – If you hold several Bitcoins, you don’t have to sell off all of them at once. A good strategy to the question should I sell my Bitcoin would be to sell a portion of them, wait for prices to dip and test previous support levels then buy back.
  • Security – Your choice of a trading platform matters a lot. Whether you choose to sell through an exchange or through cash, your security is paramount. Go for an exchange with proper AML/KYC procedures and advanced systems when it comes to security When exchanging Bitcoin for cash, meet in public places.
  • Research – When answering the question, should I sell my Bitcoin?- deep research and analysis is needed. We can’t emphasize enough – carrying out due diligence before selling Bitcoin is a must. Look at charts, analyze fundamentals, read about the future of Bitcoin among other things. You will most like be overwhelmed by the information out there, but carrying out research will help you make an informed decision.

Where to Sell Bitcoin

The best thing about Bitcoin and cryptocurrencies in general is that you don’t need an intermediary to transact. You can set the price, go into the market and transact directly with the buyer. However, you need legit trading platforms such as exchanges to sell Bitcoin. Our top picks of crypto exchanges to safely transact Bitcoin include:

  • Binance – As one of the largest crypto exchanges in the world, Binance has deep liquidity which means that your sell order will be fulfilled quickly. Better yet, it has a P2P platform where you can transact using your country’s local currency.
  • Paxful – As a young exchange, Paxful has cemented its place as a safe and thriving place to trade cryptocurrencies. With extremely low fees, the platform allows you to sell your Bitcoin and withdraw using a credit/debit card.
  • Coinbase – Available in over 103 countries, Coinbase is a vibrant Bitcoin marketplace with competitive rates and robust order books.
  • Peer to peer platforms – These include Local Bitcoins and Remitano where you can swap Bitcoin for cash or by simply depositing BTC to a given Bitcoin address for fiat.

Wrapping Up

Through the years, Bitcoin has faced a lot of criticism with many calling it a bubble and predicting that the price would drop to zero at some point. On the contrary, Bitcoin has continued to rise and stamp its authority in the financial market place as a worthy asset to hold.

So, the answer to the burning question: should I sell my Bitcoin? Well, that depends. If you are selling to buy into the dip, then you can dispose of some of your coins since you will buy more at a lower price. If you are selling your Bitcoin out of fear that it’s a bubble, then research some more and look at the fundamentals. You could be disposing of an asset that will be pure gold in the future. When it comes to Bitcoin, HODLING is the way to go. Ask anyone who bought Bitcoin at the start!

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