Is now a good time to sell Bitcoin? For you, the answer might be yes. However, the right time to sell is different for everyone.
To make a profit selling Bitcoin, smart investors decide when they will sell, long before initially buying Bitcoin. However, the current Covid-19 pandemic is disrupting how some traders do business.
Is Now a Good Time to Sell Bitcoin?
As a rule, it is rarely smart to sell Bitcoin just because prices are falling. This is because people who panic sell BTC typically make significant investment losses.
Did you buy Bitcoin just as prices were rising? If so, you are likely a FOMO investor.
FOMO (fear of missing out), sees investors buy Bitcoin in anticipation of prices rallying further upwards. This is a problem, as the same investors often panic sell Bitcoin at the first sign of prices pulling back.
You are a FOMO investor if:
- You only recently bought Bitcoin.
- When you bought Bitcoin, you bought expecting prices to continue to rise upwards, resulting in major investment gains.
- You didn’t decide when to sell Bitcoin before you bought into the cryptocurrency market.
Now that the Bitcoin price is correcting, you believe that it may go all the way back to zero.
FOMO investors are also usually consumer investors with little capital to spare. If this is the case, and selling Bitcoin now will see you make a significant loss, now is not the time to sell coins. At least, not unless selling is absolutely necessary.
Know When to Sell Bitcoin by Setting Personal Targets
If you are a consumer investor, it is advisable to only sell Bitcoin after the Bitcoin price reaches a level where you will make at least some profit. This means that if you are a FOMO investor, it is wise to wait until the Bitcoin price re-tests a point $500 or more above the point you bought into the market.
- FOMO investors often make the same mistakes multiple times when trading. For this reason, it is advisable to exit the market as soon as you make some profit.
- Smart traders plan in advance to only sell cryptocurrency when sale prices will result in 20% to 100% gains.
- When anyone sells BTC for Cash, it is important to calculate how much profit will remain after trading fees and taxes.
The only time to sell Bitcoin when the selling of coins will result in a significant loss is when selling is necessary due to other financial factors. If you can’t pay your rent, mortgage, or living costs this month, selling will be in your interest. Otherwise, though, investors are wise to Hodl during market downturns.
How to Sell Bitcoin for Cash
As well as knowing when the right time to sell BTC is, it is also wise to plan how you will eventually sell coins. This is important, as most cryptocurrency exchanges require users to verify their identity. Some might also ask Bitcoin holders to verify how they have come to acquire the coins.
- Before selling Bitcoin, identify what exchange you will use to sell coins.
- Prior to depositing Bitcoin on exchanges, make sure that your account is fully verified.
- Only attempt to sell Bitcoin on reputable exchanges that operate in your country of residence.
Anti-money laundering laws mean that exchanges operating outside of your country of residence might not be able to transfer any cash you sell crypto for to your account. This being the case, always research the best exchanges for you to use in advance of selling.
Other Ways to Sell Bitcoin
Cryptocurrency exchanges like Coinbase, represent the easiest way for most investors to sell large amounts of crypto. However, it is also possible to cash out smaller amounts of BTC using prepaid credit cards that support Bitcoin deposits.
Popular cards to consider using in 2020 include Netteller, Revolut and Skrill. With these, it is possible to cash out up to $500 in Bitcoin in any 24-hour period. All that it is necessary for investors to remember, is that some cards can charge high transaction fees.
The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
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