Worried about privacy and traceability when you cash out Bitcoin? Read on to learn how to sell Bitcoin anonymously, so you can enjoy your privacy again.
Why should you sell Bitcoin anonymously?
Though Bitcoin is becoming increasingly popular in the mainstream, several misconceptions remain. Chief among these is the idea of Bitcoin anonymity.
Bitcoin has a widespread reputation of being an anonymous virtual currency, but that isn’t true. Bitcoin is pseudonymous, meaning anyone can create a Bitcoin address (also known as a public key) on its public blockchain, then use it to send and receive Bitcoin effortlessly. However, once you appear on the blockchain, your footprint never fades.
A Bitcoin transaction, by design, is recorded eternally on the public ledger. That means every action you take is stored permanently and publicly. Everyone can see the balance of your address, the history of your transactions, and the addresses of everyone involved.
In short, there is direct, public access to all the transactions you’ve made, even if you, the address holder, are pseudonymous. This aspect of Bitcoin makes it a transparent currency, but endangers your privacy.
Interested in crypto privacy? Check out we.incognito.org for more resources.
The parties of a Bitcoin transaction are easily identified
When making a Bitcoin transaction, neither the sender nor the receiver needs to submit identification or other personal info. Nonetheless, there are many tools and techniques to identify the parties involved, including tracing the IP address of the sender or the time-stamps. Especially these days, coins are marked by many clues, meaning your coins are easily traced.
While the average user might not be able to piece these clues together, the ones who can are precisely the ones you don’t want. Hackers and thieves are well-equipped to backtrace your transactions and figure out your real identity. In this case, not only are your funds at risk, but also your life and physical safety.
If you don’t want to take these risks, you should learn how to sell Bitcoin anonymously and transact coins without anyone knowing.
If you still wonder how to use bitcoin anonymously, have a look at useful methods below.
The ultimate guide – how to sell Bitcoin anonymously
As previously explained, Bitcoin transactions are transparent, making it hard to transact coins without exposing your identity. It’s even easier to trace your transaction history when you use a KYC-exchange.
Regulated crypto exchanges require identity verification to prevent money laundering and protect your account better. However, KYC is the policy that links your personal life to your crypto assets.
Hence, if you want to sell Bitcoin anonymously, the most important thing is to stay away from exchanges that require KYC.
There are some platforms and methods that provide anonymity for Bitcoin purchases. Continue reading for a closer look at them.
Method #1. Sell bitcoin anonymously, in person
Crypto exchanges are not the only way to buy and sell Bitcoin. You can find a buyer that lives near you and make a deal face-to-face.
The number of people that are willing to purchase will surprise you. Because it costs fees and time to trade on a crypto exchange, and because people also want to protect their privacy, they turn to in-person transactions.
The process is pretty easy. You can join a local community on Facebook or Telegram to seek buyers. After that, you two make an agreement on the price (which is usually lower than the exchange’s price), the place, and the payment method. Then, you meet your partner at an agreed-upon (ideally public) location, send your Bitcoin to him and take your payment.
It’s better when you actually know your partner, and have an established relationship with him/her. Selling crypto to friends and relatives is much safer, as you don’t incur the danger of meeting strangers and giving them your money.
Of course, there is a high riesk when you make a deal with strangers. In this case, meeting a person without checking his credit and having ways to protect yourself may be harmful. There is no guarantee that you will not be scammed.
If you want to remove the in-person human element without relying on an exchange, a Bitcoin ATM is another option.
Method #2. Two-way Bitcoin ATM to sell Bitcoin for cash
Similar to a fiat (government currency) ATM, Bitcoin ATMs are machines that accept cash and pay Bitcoin directly to your wallet address. More conveniently, there are two-way Bitcoin ATMs that offer a way to sell Bitcoin for cash.
You can find a two-way Bitcoin ATM near you with any number of Bitcoin ATM live maps.
To use a Bitcoin ATM, simply:
- Choose the withdraw cash option
- Select “Bitcoin” to sell
- Enter the amount you wish to withdraw
- Send the equivalent Bitcoin to the given address
- Collect your cash.
However, one of the most disappointing things is that more and more Bitcoin ATMs require KYC, effectively disabling all privacy measures. Due to government regulations, many Bitcoin ATM providers must require some KYC documents from users. Thus, it’s harder for you to find a totally anonymous Bitcoin ATM nowadays.
Therefore, many look to selling Bitcoin on a peer-to-peer exchange instead.
Method #3. Sell Bitcoin anonymously on a Peer-to-Peer Exchange
A Peer-to-peer (P2P) exchange is an online marketplace that connects buyers and sellers all around the world. That means it plays a role as an intermediary between you and your partner.
LocalBitcoins.com, LocalCryptos.com, and Paxful are worth considering. These exchanges differ from in-person purchasing because they give their users a credit rating. The platform enables users to rate their partners and share their experiences after each trade. The higher the rating, the more trustworthy the partner.
Additionally, you are able to accept various payment methods on these platforms, including cash, PayPal, other cryptocurrencies, and wire transfer. It provides you more convenience than the above methods.
Unfortunately, this convenience isn’t free. As a third-party, a P2P exchange takes fees as revenue. Consequently, you may suffer a higher price than usual. Even if you don’t mind this kind of fee, purchasing frequently may cost you a lot of money.
Of course, there are many cases in which one must accept trade-offs in return for convenience. But in this case, there is another method that’s not only free, but also provides complete privacy and other useful features.
Let me introduce you to the private crypto wallet.
Method #4. Use an anonymous crypto wallet to sell Bitcoin anonymously
A private crypto wallet was born to provide anonymity and privacy for Bitcoin users. This kind of wallet helps you transact Bitcoin (and other assets) without anyone knowing.
Every private crypto wallet has its own techniques to obscure your transactions, some are advanced and others not. Without a doubt, the Incognito Wallet is one of the best private crypto wallet apps on the market.
The Incognito Wallet: The ultimate way to send, sell, and buy crypto anonymously
Based on the idea of a sidechain for all blockchains, the Incognito Wallet is the easiest way to buy and sell Bitcoin anonymously.
Using smart contracts and trustless custodians, the wallet turns your coins into privacy versions of your coins which you can trade and transact anonymously. For instance, your Bitcoin (BTC) can be switched to privacy Bitcoin (pBTC) at the rate of 1:1. Then you can easily send, receive, hold, and trade Bitcoin anonymously, without anyone knowing your balance or having any clues to your identity.
Want to turn your coins back? Just one tap, and BTC will be released from the smart contract and returned to you effortlessly. No intermediaries, no one to trust. Your privacy is in your hands.
To sell Bitcoin anonymously, you can send pBTC to a buyer’s Incognito Wallet address and take your payment. Or, you can trade it in the app using the pDEX, the world’s only privacy-focused, permissionless, free-to-play decentralized exchange. This way, no one will be able to trace your transaction and find out who you are. As a result, your privacy is totally protected.
One more advantage is that the wallet is completely free. You don’t need to pay for any of its awesome features.
The transparency and traceability of Bitcoin transactions are big motivations for the crypto community to seek ways to sell Bitcoin anonymously.
Once you find the most suitable method yourself, you will never want to sell Bitcoin in the traditional ways anymore. Some methods cost a fee, others cost your privacy. But with Incognito, your right to privacy is in your hands, protected at all costs, for no cost to you. Visit we.incognito.org to explore a community of privacy protectors who started just like you.