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Tutorial: How to Sell Bitcoin

In this tutorial, we are going to explain the benefits, risks and an overall step-by-step guide on how to sell bitcoins through Paxful. We have made this guide to help you better understand the process involved and make you aware of some risks that you may face when selling your bitcoin on the site.

Part I – Using and Loading Your Paxful Wallet

If used correctly we believe you have a lot to gain by using our website. We have accounts that are managing to make reasonable profits by using our platform and it is in our best interest to keep you informed on how you too can gain from it.

Your Personal Bitcoin Wallet

Before you can start selling through Paxful, you must first top up your account with some bitcoins. To do this, please first log into the site then proceed to the link at the top, labeled as “Wallet”:

Wallet Balance & Address

Once you have clicked on this link and the page loads the content, you should see your balance, some other buttons and also your personal bitcoin address:

If you are unsure about any of this, please click on “HELP USING WALLET” button. This will take through the page to help you better understand the different parts of the page. If you believe you would like to go through this process, please take a few seconds and run through the help tutorial. You can also access your wallet to send bitcoins from to any other bitcoin address.

Deposit & Wallet Address

On this page you will also see a section that contains your bitcoin address. You can copy the address by using the button – as shown in the image – or by simply highlighting the wallet address and copying it manually. This address can be used to receive bitcoins from anywhere in the world. Think of it as your personal bank account number. Though unlike bank accounts, you can generate a new address every single time you want to receive more bitcoins.

Generate New Address (Optional)

If you do want to generate a new address – some people do this for better privacy or for personal record keeping purposes – then click on the down arrow next to “Copy address” then proceed to “Generate new address”.

Transactions & Addresses

Below this section you will find another section outlining your transactions (buy/sell) and addresses you have used to receive bitcoins. You can explore these further once you have made a few transactions and/or received bitcoins to your account.

Transactions & Addresses

Once you receive your bitcoin, you will get a both an email and website notification to confirm that your bitcoin has come through.

Site Notifications

You are now ready to start selling!

You can now go to the SELL BITCOIN section by clicking on the down arrow / tab on the BUY BITCOIN button.

Part II – Validating Profiles, Selling Directly

Now that you have topped up your account and reached the “Sell Bitcoin” page, you can start choosing the currency and method of payment that best matches your criteria. In some cases such as the Amazon Gift Cards, you may notice that prices offered for bitcoin can reach up to 2 times the current price of Bitcoin. We will go over some things to note to make sure that you always remain safe and secure during the process. Some offers may be too good to be true and if that is the case, we urge that you take some time to understand the risks involved.

Familiarize yourself with the search bar:

The search bar allows you to select:

  • The amount you want to sell.
  • The desired currency.
  • The method of payment you prefer.
  • Give me the best (brings you the best offers based on when the buyer was last online and their rating).

In this example, we will sell $20 selecting USD as the currency with the Amazon Gift Card as a way to receive the money. There are over 300 ways to sell bitcoins. Each has their own benefits and risks attached, depending on your personal choice.

Selecting an offer:

This is one of the most important parts of the entire process. As you can see there are several things that we have highlighted here:

  • Last seen online: This shows whether the person was online to determine whether if you were to make the trade, they would be available to chat and make the trade.
  • Positive feedback Shows the number of positive feedback that person has. You can use this to evaluate the risk when making a trade. Note: a higher number does not automatically mean that they are to be trusted. Some people can do insider trading with themselves on different accounts to increase the number. Please check their profile, their trade volume, and number of ways they have verified themselves.
  • Mix-Max amount: You can see here the amount bracket the person is willing to purchase. Perhaps the person has a minimum or maximum limit that is below or beyond what you have in mind. It is also recommended that you do the trades in small amounts until you can trust the person.
  • Rate per bitcoin: This rate can change depending on the person. You can usually believe that if it is too good to be true, it usually is.

Offer #1:

For the sake of this tutorial, we will a few to give you an idea of how to make a trade:

So in this instance, we have selected a person who is giving us $1.9 for every $1 we trade with them in the form of an Amazon Gift Card. It seems like a pretty good way to save on purchases!
Note: We do recommend in such cases that you do ask for a receipt and that the person shows the proof of payment for the gift card – ideally you want the gift card to have been paid for by cash.

Protection Warning:

Chat Dialogue (Unsafe/Poor):

Sample chat example of how you can protect yourself. Still we do not want to make a purchase of $100 without doing some minor trades first. So now we try another user.

i sorry but ? have only 100usd GC and more

you did not mention this in your limit

I know before I had less too

with the 100usd can you send me the receipt and proof of payment for the GC?

sure I send always the receipt

was it paid for by cash or CC?

only by cash

is a problem?

no, just in the past I’ve had people send me a GC but then Amazon says it is not working anymore after I make the purchase, because they used a stolen credit card to buy the GC.

nono I dont fraud nobody

okay, thanks buddy. i will try a lower amount but if i do more, i will come to you 🙂

User Profiles (Poor/Unsafe):

It is always a good idea to check the user profile of the person you are making a trade with. In this example we have highlighted:

  • Verification: This indicates whether the person has gone through all the verifications possible on the site. It is a good to make sure they have both options verified!
  • Trades: This number indicates the number of trades a person has committed to on the website. Typically you want a person that has committed to more than 20 trades and has at least 10 partners. It would mean that person is experienced enough on the platform and can guide you through.
  • BTC Volume: The volume can be used as an indicator to analyze the integrity of the trades the person has committed to. 10 BTC is still valued over $10K USD at the time of writing this, so it is a decent amount, though we do not know how less it is. It could be as small as a few $50 trades.
  • Trusted by: Shows how many people have trusted this person. Keep in mind anyone can trust another user without even having performed a trade with them.
  • Blocked by: Shows how many people have blocked the person. Indicating to not trade with the person. These can be trolls or vendors blocking each other, though, usually a good indicator to look into the profile and feedback further before performing trades. Keep in mind anyone can block another user without even having performed a trade with them.
  • Joined: How long has the member been registered with the site. You want a member that has been a member for at least a month. Being a new member does not have to mean something negative, but if you are doing larger trades, we recommend someone that has been around for a longer period for your peace of mind. A longer period may not mean a higher trust, but it is a good way to know that at the least the person has been around and not performed any fraud during that time. It would be a waste of their time to build up a good profile for a long period just to ruin it in the end.

Overall – I would rate this profile as unsafe for large trades based on a few reasons:

  • Is a new member with only 4 days passed since registration. At times some transactions such as a gift card can go wrong after 2 weeks. With Paypal this can be even longer. So you want the person to have been a member long enough that if such a thing has happened, the user would have had enough time to come back and mention it.
  • Only performed 3 trades with very low volumes.
  • Phone number has not been verified. This does not have to mean something negative, though it is a good idea to go for a profile that has committed to being a legit bitcoin buyer, thus doing everything they can to verify themselves and relieve the seller of any doubt. Keep in mind that during the trade process you can see their phone carrier information. In some cases if user has VoIP phone such as Google Number, it would be higher risk.

User Reputation (Poor/Unsafe):

The user reputation is essential in selecting a safe buyer to sell to. If correctly selected with consideration to the duration that the member has been registered with the site, you can ensure that the trade will go through without any issues.

In this example, the user has been registered for 4 days and has a positive reputation consisting of 5 trades. Ideally, you would want someone that has been registered for a bit longer and has performed a greater number of trades.

User Profiles (Good/Safe):

In the previous example, we showed you an example of a profile that we deem unsafe. Now we will show you an example of one that we believe represents a good set of :

Verifications: We can see in this example, that the person has verified both of their contact details. This is a great starting point.
Trades: We mentioned that we want the person to have committed to at least 20 trades. In this case, they have done so with over 240 trades! So far so good.
BTC Volume: Next we check the trading volume. This person has reached the next level ensuring that they have traded at least 10 Bitcoins – valued at over $10K USD. Another great checkpoint.
Trusted by: Shows how many people have trusted this person. In this case, 24 is a good number, though again keep in mind anyone can trust another user without even having performed a trade with them.
Joined: This aspect is pretty important. Users who have joined a long time a go can alleviate us of our worries for the most part. This is because it is much more likely that they would have been banned from the site or been reported as a scammer during that timeframe. We can access a longer history of comments, feedback and reputation point to when making our decision.

Overall – This profile would be rated as safe and a worthy vendor willing to purchase for the following reasons:

  • Has performed over 20 trades.
  • Has been a member for longer than 3 months.
  • Phone number and email have been verified.
  • Comments left by users seem thorough, not just a simple one-word review.

User Reputation (Good/Safe):

The user reputation is essential in selecting a safe buyer to sell to. If correctly selected with consideration to the duration that the member has been registered with the site, you can ensure that the trade will go through without any issues.

In this example, the user has been registered for more than 7 months and has a positive reputation consisting of 242 trades. With the exception of one negative review and three neutral reviews, they have an exceptional 215 positive review. With this in mind, we proceed with the trade.

Chat Dialogue (Average):

In this trade, we approached a buyer who we assessed and marked to be a safe member based on their many previous trades and other factors listed above. Once a trade is initiated, you can see a more detailed view on their mobile phone – if they have verified this. This allows you to see the provider and whether it is a normal network or purchased via a VOIP/Google phone service.

The partner had set their location to USA, though after a short look we noticed that the mobile number was from China.

We also noted that the coupons were for the German Amazon website. This coupled with the location of the mobile phone, raised our concerns and diverted our attention towards needing to address this with the buyer.

As we proceeded to question the situation, we also noted that the buyer did not provide a receipt for the gift card. This all pointed to an unsafe sell, though the user canceled the transaction.

Timeframe:

The timeframe in which the buyer can perform the trade varies from user to user. Ideally, you would want someone that can do this fairly quickly so that you do not have to wait for them to communicate and finalize the process.

Amazon Gift Cards

There are various methods by which the user may try to provide you the gift voucher. Some require you to make a purchase straight away with the code, others purchase on your behalf and the code itself can be sent in a physical card, e-code or even Amazon coins. They all have their own risks and usability. In our case, the user wanted to make the purchase on our behalf. This is a good idea if there is an item that you want and the buyer can make the purchase for you, whilst getting a discount through the process.

Safety Tips

Gift Cards

  • Biggest profit and every vendor has its own ways to convert gift card back to bitcoin and usually does not share it around.
  • Ask receipt and make sure gift card is bought with cash.
  • Watch out for brokers so when suspicious ask to write on receipt your username/trade ID and let them retake pictures.
  • Be careful when accepting e-codes or gift cards bought with debit/credit cards as any debit/credit card purchase can be charged back.

Cash Deposits

  • Least risk, smallest profit margin but purchase amounts are higher compared to gift cards.
  • Make sure buyer deposits cash on your name and ask for receipt

Online Wallets

  • First make sure that buyer’s account is verified on that wallet (i.e verified PayPal account).
  • Ask for ID of the buyer. Make sure full name matches on ID and online wallet account.
  • Riskiest way to sell bitcoin since buyer can easily charge back but at the same time it’s the quickest way to acquire bitcoin without leaving the computer.
  • Every payment is tied to debit/credit card which is the reason why it can be easily charged back. In example of PayPal less risk would be to make sure buyer is sending payment from their PayPal balance and not directly from debit/credit card.
  • As extra precaution option ask buyer to write on paper that he confirms the purchase of bitcoins with trade ID, amount, and payment that payment is final. In the case of charge back you can show it as evidence.

Debit/Credit Cards

  • As risky as online wallets. Has same chargeback avoiding tips as online wallets. Except that debit/credit card name has to be matched with one on ID.

 

Part III – Creating an Offer & Incoming Trade

This part will explain how to safely create an offer to sell followed by the process of accepting an incoming trade. As we saw in the previous part, there are some offers in the sell section that turn out to be too good to be true. To avoid having to deal with scams and such things with the added benefit of setting your own price, we recommend using the “Create an Offer” link.

Create an offer to sell:
You can find this link by following the drop down on the “Buy Bitcoin” button and selecting “Create an Offer”.

Sell Bitcoin:
This section deals with both buyers and sellers, as both can be selected to offer. For the purpose of this tutorial however, we will be focusing on the sale aspect.

  • Choose Currency: Select the currency that you wish to sell your bitcoin for. You can see the list of available currencies on the drop down. In this example we have selected USD – U.S Dollars.
  • Payment Method: Select from over 300 payment methods. PayPal, Amazon Gift cards etc. We will select Amazon Gift Card.
  • Payment Method Label: If you would like to leave a note for the buyer to see with the payment method. For example in the case of the Amazon Gift Card, we will mention “cash receipts only” to increase our safety when dealing with gift cards.
  • Country: In some cases, such as bank transfers or other situations, you may want your offer to be displayed to certain regions. If that is the case, you can select the countries here. We will not be doing this as it does not relate to our sell method.
  • Price Margin: This allows you to select a percentage to increase the price of Bitcoin by. Meaning that regardless of the live Bitcoin price, the amount will be increased by the percentage you enter in this field. If lets say the price is $1000, and you put 10%, the buyer will see the price as $1100.
  • Set Minimum & Maximum Amount: The Bitcoin trading price can be volatile, this allows you to create a safety price so that you are always in the safe zone. Perhaps the price of bitcoin increases and you no longer want to sell it if it reaches above $1500 or in reverse, what if the price drops down below $800. You can adjust these based on your own thoughts.
  • Alternatively Use Predefined Amounts: This is useful if you are looking for a specific price. Perhaps you have an item in mind that you would like to attain by selling your Bitcoin. You can select such amounts using this option.
  • Payment Window: You can define the amount of time the person has to complete the transaction and make the purchase. This helps support those who are selling amounts that they do not want tied up into a transaction that may not be paid for within a day. Some may want the process to be done quickly so that their Bitcoin is not held in escrow for a long time. This can also help you go through the process quicker, rather than waiting a long time for the end user to make the payment or finalise their end of the purchase.
  • Offer Terms: If you have any terms that you would like the buyer to commit to, you can simpy write them here. It could be something like “I need the receipt of the gift card and it has be purchased using cash. Will also require your ID.” You can customise this based on your own terms and selected method of payment.
  • Offer terms tags: As mentioned above, you can select tags related to your terms. Such as “ID Required”, “Cash Only”.
  • Trade Instructions: To help the buyer understand the process better, you can inform them with your instructions here. Try and let them know how you would like to make the sale and what is required before the Bitcoin is released to them.
  • Advanced Settings: These settings allow you to control some other functions, which are useful based on your personal references.
  • Dissalowed Countries: If you would like people from certain countries to not see your offer, then enter those countries in this section.
  • Allowed Countries: Same as above, but for allowing only certain countries to see your offer.
  • Verified: As a seller and depending on the amount you wish to sell, you should select both, especially in the case of higher amounts. This verifies that the buyer has done their best to increase their integrity.
    Require that trade partner has verified their email
    Require that trade partner has verified their phone
  • Offer visibility
    Show offer only to trusted users: Users who have had others select them as being trustworthy have a number to represent this.
  • Require minimum: In our previous article we mentioned that it would be a good idea to select users with at least 20 trades. If you would like to implement this recommendation, then enter your desired number in this field, or use our recommended amount.

Vendor Dashboard:
The vendor dashboard allows you to see all your active trades and offers. You can also monitor your earnings and overall activity. Once you receive place an offer, people can request to purchase through you. This will place the trade into the “Active trades” section. There you can click on “CHAT” to initiate the conversation.

Finalise The Deal:
All trades are performed through a live chat. Here you can provide support, upload files, discuss and verify the payment. Once you are done and satisfied, you can release the requested Bitcoins. Always make sure you are safe and secure prior to releasing the Bitcoins in escrow. After you release them, there is no way to undo the process.

We had included some safety tips in the previous tutorial, though we will once again include them below.

Safety Tips:

Gift Cards

  • Biggest profit and every vendor has its own ways to convert gift card back to bitcoin and usually does not share it around.
  • Ask receipt and make sure gift card is bought with cash.
  • Watch out for brokers so when suspicious ask to write on receipt your username/trade ID and let them retake picture.
  • Be careful when accepting e-codes or gift cards bought with debit/credit cards as any debit/credit card purchase can be charged back.

Cash Deposits

  • Least risk, smallest profit margin but purchase amounts are higher compared to gift cards.
  • Make sure buyer deposits cash on your name and ask for receipt

Online Wallets

  • First make sure that buyer’s account is verified on that wallet (i.e verified PayPal account).
  • Ask for ID of the buyer. Make sure full name matches on ID and online wallet account.
  • Riskiest way to sell bitcoin since buyer can easily charge back but at the same time its quickest way to acquire bitcoin without leaving computer.
  • Every payment is tied to debit/credit card which is reason why it can be easily charged back. In example of PayPal less risk would be to make sure buyer is sending payment from their PayPal balance and not directly from debit/credit card.
  • As extra precaution option ask buyer to write on paper that he confirms purchase of bitcoins with trade ID, amount and payment that payment is final. In case of charge back you can show it as evidence.

Debit/Credit Cards

  • As risky as online wallets. Has same chargeback avoiding tips as online wallets. Except that debit/credit card name has to be matched with one on ID.

 

Congraultations. You made it and are now ready to begin trading. Remeber to take your time and go slowly.

For more help check out our videos, knowledge base and forums.

-Paxful

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