The following are your two major choices for converting Bitcoin into local currency:
Using a Service for Exchange
A certified business that deals with the conventional banking system is an exchange service. A cryptocurrency exchange can be as basic as a website with limited exchange capabilities, a secure and anonymous Bitcoin wallet with banking links, or a comprehensive cryptocurrency exchange with the order book, money markets, and other features.
Peer-to-Peer Selling
When selling peer-to-peer, you may avoid the traditional banking system to some extent by accepting cash, utilizing a payment tool such as PayPal, or paying the transaction with products or services. You may purchase Bitcoin directly from someone you know who wants to sell it. Alternatively, several sites function as matchmakers, assisting sellers in finding buyers and vice versa. Then, on a peer-to-peer basis, buyers and sellers negotiate deals.
Identity Verification
You’re dealing with a regulated company when you sell cryptocurrency through an exchange provider. Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements must be followed by such firms. Customer information, such as identity papers and, in some cases, proof of address, must be collected and stored in accordance with these requirements.
Transaction Fees
The cost of selling Bitcoin varies depending on the payment option and platform/venue. If you’re selling Bitcoin directly to a friend and paying cash, for example, you’ll simply have to consider the ‘network charge’ for transferring BTC from your Bitcoin wallet app to your friend’s wallet. If you’re getting money by bank transfer, you will need to account for the costs that come with it. Fees are also charged by exchange providers for facilitating deals. These charges cover the exchanges’ operational expenses plus a tiny profit margin.
A number of platforms make Bitcoin and other digital assets trading easier by providing
1) A place for buyers and sellers to publish their sales orders
2) An escrow and conflict resolution service.
Because these platforms primarily serve to connect individuals, they aren’t officially recognized as exchanges or “money transmitters” in many jurisdictions, thus you may not be required to divulge your name in order to use them. P2P services, on the other hand, might be an appealing means of purchasing Bitcoin for privacy-conscious purchasers. As a result, such platforms frequently have a large number of purchasers.
It’s crucial to examine your local regulations while selling Bitcoin peer-to-peer. You may find yourself on the run from the law in many places if you sell beyond a certain daily and/or annual limit.
The following is a typical procedure for selling Bitcoin on a P2P platform:
-Make a listing for the quantity of Bitcoin you want to sell, or check through the listings of individuals wishing to purchase Bitcoin.
-Begin a transaction. As a result, the coin you will be selling is secured in an escrow account.
-Verify that the agreed-upon payment amount was received using the agreed-upon payment method. It’s worth noting that this may even include seeing the buyer and taking payment in person.
-The site will transfer your crypto to the buyer’s Bitcoin wallet once you’ve verified payment.