Author: Alex Harper
What is Bitcoin (BTC)?
Bitcoin is a decentralised digital cryptocurrency – the first of its kind in the world. Bitcoin was invented by Satoshi Nakamoto back in 2009. While Bitcoin acts as a medium of exchange, store of value and unit of account, it is not issued under the authority of any government body.
Every Bitcoin transaction is made on a peer-to-peer network online and there is no server or central authority that needs to check first with a bank before clearing a transaction. The decentralised verification process creates the potential for people to transfer funds to each other faster and at a lower cost than traditional methods. Currently, international money transfers can come with relatively high fees and high exchange rates to cover the costs of the banks involved.
Blockchain, the technology behind Bitcoin and other cryptocurrencies, is basically a ledger of who owns which Bitcoins. Every transaction made with Bitcoins is sent to the decentralised network and “mined” into the Blockchain. If you own Bitcoins, you own the digital keys to unlock and spend or move those funds.
Related article: How to buy Cryptocurrency in New Zealand
How to sell cryptocurrency in three easy steps
The easiest, and most popular, way to both purchase and sell cryptocurrency is through an exchange. An exchange acts as an intermediary between the buyer and the seller. They hold each party’s funds in the buy-and-sell process. So, here’s how you can sell Bitcoin through an exchange:
Step one: Open an account with an exchange
To get started selling cryptocurrency through an exchange, you need an account. Reputable accounts should include some sort of identity verification requirement – if they don’t, you should probably look elsewhere.
Related article: What To Consider When Choosing A Cryptocurrency Exchange
Step two: Transfer your coins
Once your account is set up, you need to transfer coins from your crypto wallet to your exchange account. Every platform is slightly different, but the option to transfer will likely be on your home screen and, from there, you follow the prompts. Most exchanges do not charge fees to transfer from your wallet to the exchange.
Step three: Place a sell order
How this looks on each exchange’s interface will be a little different, but the basic premise is the same. You set the price and wait for an interested buyer. Once sold, the funds will be credited to your account. To access the funds, you will need to transfer them to a bank account. Keep in mind, these transfers can be subject to withdrawal fees that differ between each exchange.
If instead of selling for fiat currency, you’re selling for another cryptocurrency, you’ll simply transfer the newly acquired currency to your crypto wallet, instead of your bank.
Where to sell Crypto in NZ
The display order does not reflect any ranking or rating by Canstar. The table does not include all providers in the market.
|Provider||Fiat Currencies||Bitcoin||Other Currencies||Est.|
|Easy Crypto||NZD, AUD||Yes||100+||2018|
|Independent Reserve||NZD, AUD, USA||Yes||24||2013|
This information is not an endorsement by Canstar of cryptocurrency or any specific provider. Canstar is providing factual information supplied by providers. Cryptocurrencies are speculative, complex and involve significant risks. Canstar is not providing a recommendation for your individual circumstances or in relation to any particular product or provider.
Peer to Peer Trading To Sell Cryptocurrency
Peer to peer trading, as its name suggests, is the direct exchange of cryptocurrency from one wallet to another. The buyer will provide their wallet address for the seller to transfer to and, typically, the buyer will either pay in cash or do a bank transfer of funds.
For obvious reasons, this can be risky, so be sure you can trust the buyer or seller you’re dealing with. There are several P2P marketplaces and forums online, and some of the more reputable ones provide user ratings.
So, what’s the best way to sell Bitcoin?
For ease and affordability, the best option to sell Bitcoin, or any other cryptocurrency in New Zealand, is through an exchange. However, this really comes down to personal preference.
If you opt to go through an exchange, ensure you do your research on any associated fees and, if in doubt, talk to a professional.
What can you actually sell cryptocurrency for?
Firstly, as you may or may not know, cryptocurrency isn’t actually considered fiat currency by the New Zealand government. It is considered property.
As such, it is a commodity that can be sold for one of two things:
- A fiat currency, such as New Zealand Dollars (NZD)
- Another cryptocurrency
Why would someone want to sell their cryptocurrency?
There are many reasons you may consider selling your cryptocurrency. These could include:
Bills and other expenses
While some predict crypto as the future of currency, this is certainly not the case now. You can’t go grocery shopping or pay your power bill with Dogecoin (or any other crypto) just yet. That said, you may opt to sell your coins in order to pay for these expenses.
To generate profit
Like stocks, cryptocurrency can increase in value. If you purchased Coin A for $1 at the start of the year, its value may increase to $3 by the beginning of May. This could prove to be a very profitable exercise, and you may then want to sell your coins for fiat currency.
Anticipating a dump in value
Again, similarly to the stock market, cryptocurrencies behave in both bull- and bear-like manners. If you anticipate a particular coin is about to significantly drop in its fiat value equivalent, you may opt to sell it off before this happens so your portfolio doesn’t lose its value.
Do note that if you’re buying and selling crypto in New Zealand with the purpose of making money on the deal, you will have to pay tax on any profits made. For more information on the NZ tax rules concerning crypto, check out:
Related article: Cryptocurrencies: How are Crypto Assets Taxed in NZ?
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