How to sell Ethereum
After you’ve gathered some Ether, either through mining or buying the tokens, there will probably be a point in time when you’ll decide to sell ethereum, which makes it a crucial task for you to learn how to sell ethereum.
Indeed, currently, Ether can only be used on the Ethereum network, as there are very few businesses that accept digital currencies as a means of payment and most of them accept Bitcoin exclusively.
So, if you don’t plan on being an active user of the Ethereum platform, then it is possible you have bought Ether as an investment with a plan to offload it at some point shortly.
We will cover the different ways to sell ethereum online and touch upon some trading strategies in this handy guide.
Exchanges to sell Ether
The process of selling Ether on an exchange is similar to the process of buying it. First, you need to choose an exchange where Ether is tradeable and which offers its services within your jurisdiction and create an account with it. To be able to buy and sell ethereum, you will be asked to connect your local bank account and give some additional information like your country of residence, date of birth, and phone number.
After you’ve set up your account, you will need to decide whether to trade your Ether for a different cryptocurrency or sell it for fiat currency.
Most exchanges offer wallet services on their platform. On the website, simply look for the ‘deposit into exchange,’ ‘sell,’ or ‘deposit’ button. You will see your new wallet’s address here. Simply send the needed amount of Ether from where it’s stored in the new wallet, the transfer will be done almost immediately. From there, you can set the amount of Ether you want to sell and choose the fiat currency you’d like to sell it for.
After the trade is executed, you will get the funds (fiat or crypto) in your account. If you chose to sell your Ether for any of the fiat currencies, you will then be given an option to withdraw the funds into your local bank account through wire transfer.
Withdrawing fiat currency will also attract charges. Those vary quite significantly depending on the particular exchange, so you might want to consider that in when choosing the right exchange platform.
Alternatively, there’s an option to sell Ether directly through a Localethereum peer-to-peer exchange, for those who would prefer to skip the trouble of connecting their local bank account and going through a long process of identity verification. Localethereum is entirely decentralized, unlike all other exchanges. Using Ethereum smart contracts, the escrow services and arbitrage are achieved.
Localethereum is a marketplace where users can place offers and respond to offers from others. You will typically be charged a 0.25% fee when selling on the platform. It also provides a messaging service, which lets users set up an eye-to-eye meeting to exchange Ether for cash.
Moreover, you can use services such as MeetUp where you can find your local Ethereum meet-up, where you can sell your token in a secure environment.
It is essential to remember, however, that if you choose a peer-to-peer trading option, the chances of your deal going wrong are significantly higher, as you will be dealing with people, not corporations. Remember to consider this and take discreet measures, particularly when setting up a meeting with strangers off the Internet.
Always double check the current exchange rate, the amount you’re sending as well as the public addresses.
Make sure to choose a public place when setting up a face-to-face meeting, and never invite the traders to your house or go to theirs. Also, to confirm the transaction, you will need access to the internet. Finally, before confirming a transaction, make sure the person you’re dealing with has the money ready and is set to confirm the transaction on their part.
Strategies to Apply while Trading Ether
Amongst the general investing population, the buy-and-hold trading is probably the most common trading strategy, as it is by far the least involved and most straightforward method. It is also sometimes called a long-term strategy, as it involves buying financial instruments and holding on to them for a long period before selling them at the favorable price.
Regarding digital currencies, the two undeniable market leaders are Ethereum and Bitcoin. Even though their value still fluctuates quite a lot on the daily basis, it is not expected to fall anytime soon. A vast amount of people who purchased BTC or ETH early are now harvesting the rewards, with some long-term investors still entering their ranks.
The most significant advantage of this strategy is that it saves energy and time. Basically, all you have to do is buy Ether tokens and keep them in a safe place. You as a buy-and-hold trader will not need to frequently check up on overall market performance, news and information, and price histories. Moreover, choosing this strategy means you will be performing a significantly smaller amount of transactions than active traders, and it involves low anxiety as well as lower transaction fees.
Even though the Buy-and-hold trading strategy is safer than others, when it comes to cryptocurrencies, it is not without risk. Long-term traders can’t profit from short-term price fluctuations; also it might be hard for some individuals not to be involved in the markets. Moreover, some situations might have a significant impact on Ether price, for example, the shocking DAO hack and the resulting Ethereum hard fork caused Ether price to plummet.
One significant aspect of this trading approach is the ultimate sale. Buy-and-hold investors have an option of either exiting the position entirely by selling every single coin they have or selling them in parts when the price strikes another record high.
This strategy requires a lot more time, knowledge and experience than buy-and-hold, as it involves a deeper immersion into the market. In the world of conventional securities trading, there are numerous styles of active trading. However, we are dealing with cryptocurrency market, which is entirely new and mostly unpredictable, so applying conventional trading strategies might not work.
If you’re choosing active trading, you are basically speculating on the price of Ether, which implies you will need to observe the market and Ether’s price change hourly or at least daily. Announcements, related news articles, and opinions are also an indispensable read for an active trader, as those can have a substantial impact on the market.
The golden rule any active trader must follow is to buy low and sell high. Basically, all you need to do is purchase some tokens when Ether price is relatively low, and sell them when the price increases.
You can follow the change of the price manually, just by checking the exchange rate. Alternatively, you can use trading instruments like TradingView, which let you create signals both for when the price hits a low and when it increases to a set value at which you want to sell.
A likely problem that active traders might encounter is locking in profits. Many exchange platforms don’t let their users store money in their local fiat currency. This implies that you will need to withdraw funds to your bank account each time you make a successful sale, which can take several days and will attract charges. Then, you will need to transfer funds to the exchange to buy again.
One possible way out of this difficulty is Tether, a digital currency that is used as a mean of exchange, as it is pegged to the US Dollar, which implies that one Tether will always be valued at $1. You can change your Ether into Tether to lock in gains or stop the losses and trade it back to Ether when you’re ready to purchase again.
How to sell Ethereum mined from a mining pool
When you enter a mining pool, you give the pool with an address to which your mining compensations will be sent. It is not advisable to send your mining rewards directly to an exchange-based wallet, as it’s public address changes constantly.
This doesn’t imply that you can’t sell the Ether you got as a reward for mining, it only means you have to take an additional step. One reasonable solution will be installing a local wallet for holding mining rewards and then merely transferring your coins from there to your exchange’s wallet.