If there was one term to define Bitcoin and cryptocurrencies, it would be volatility. Cryptocurrency values surge and then collapse nearly as quickly as speculation, mood, and structural events enter the market. In April 2021, for instance, Bitcoin was rising, reaching an ATH of $64,000. However, only 3 months later, Bitcoin had dropped more than half of its value, plunging to less than $30,000. Then, in November 2021, Bitcoin reached an ATH of about $69,000, before plummeting by over 40% by early January.
That volatility attracts profit-seeking traders, but it’s nerve-racking for rookie investors just getting started. And traders must expect further volatility in the future as new coins arise and others disappear.
To help the new Bitcoin investors a little, here are the two crucial things that every investor should always keep in mind before selling their Bitcoin.
Let’s Start!
1. Are you selling for profit or for fear of losing money?
The first time you come across bitcoin, you might feel overwhelmed. There is a constant stream of negative information, prices continue to decrease, and trading bitcoin in the first place appears to be a dangerous move.
When you’re a beginner, it’s a natural desire to sell your bitcoin when you’re unsure. Don’t be concerned; we’ve all been there. Unless you purchased your bitcoins at the maximum price, you should not sell them as soon as some unfavorable news hits the market. Even after substantial price drops, bitcoin usually makes its way up.
In addition, you need to consider your financial position and timeline. However, if it is only an emotional reaction to the circumstance, stop and reconsider. Perhaps you committed too much of your hard-earned money to bitcoin, and your bitcoin investment is now keeping you awake at night.
Your bitcoin investment may have surpassed your risk tolerance. Fear, confusion, and doubt are powerful indicators that you’ve invested more than you should have invested. Hence, selling your BTC is a good option.
As opposed to this, if you want to sell your bitcoin for a profit, this is most likely the best thing to do.
2. Various methods for selling bitcoin
Bitcoin is a flexible asset that you can exchange in a variety of ways. There are varying degrees of accessibility, so their use depends on your circumstances, like your geographical location.
The following are the most popular ways to sell BTC:
- On a DEX.
- On a centralized exchange.
- Using a P2P exchange platform.
- Face-to-face exchange of bitcoins for cash.
- Using a bitcoin ATM to exchange bitcoins for cash.
In most circumstances, using a centralized or decentralized exchange is the quickest way to sell Bitcoin. However, you will almost certainly require a bank account to check out.
You might wish to sell bitcoin for cash if you don’t have a bank account. In such a situation, a Bitcoin ATM that allows you to exchange bitcoins for cash can be a quick and easy option to sell bitcoin. However, this method is more expensive than utilizing an exchange, since it involves additional costs.
Bottom Line
A drop in the bitcoin market can make you nervous, but use it as a wake-up call to reconsider why you’re invested in the market. What are the possibilities and hazards it presents?
While Bitcoin, for example, has recovered well following prior large dips, there is no assurance that it will do so again, especially if it is facing serious fundamental problems as nations prohibit its usage and, perhaps, ownership. In this sense, a genuine danger can either kill or benefit an investment, depending on how severe it is in reality.
Also read: What is Tokenized Bitcoin? Explanation of Tokenized Bitcoin on Ethereum
