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This Is How You Can Sell Ethereum

Hedge With Crypto aims to publish information that is factual and accurate as of the date of publication. For specific information about a cryptocurrency exchange or trading platform please visit that provider’s website. This information is general in nature and is for educational purposes only. Hedge With Crypto does not provide financial advice nor does it take into account your personal financial situation. We encourage you to seek financial advice from an independent financial advisor where appropriate and make your own inquiries.

Yes, You Can Sell Ethereum

Selling Ethereum has become easier thanks to the asset’s increased access and mainstream acceptance. The most popular way to sell Ethereum is through a trusted crypto exchange service that allows buyers and sellers to meet their crypto demands. Crypto exchanges are ideal for sellers because many of them are regulated and safe. Also, most of the world’s top exchanges offer easy integrations that allow traders to sell their holdings and get paid via different channels – from bank account transfers to card payments and even connections to e-wallet solutions like PayPal and Apple Pay.

However, a crypto exchange is not the only payment channel where sales can be made. Investors can also use P2P platforms for convenience, use crypto ATMs, or transfer their Ethereum to a crypto debit card and spend it – an increasingly attractive option.

When selling ETH, it is important to note the fees. Platforms that allow traders to sell Ethereum tend to charge fees, which vary based on several factors, including network activities, third-party charges, and the fees taken by the platforms. Understanding these fee structures will be critical for any trader seeking to maximize profits.

Here's the quick steps you need to know to sell Ethereum:

  1. Compare and select a crypto exchange. Find and compare Ethereum exchanges that are available within the specific country and support the desired fiat currency. A good example is Binance.
  2. Register an account with the exchange. Create an account with a crypto exchange using a valid email address or mobile number. Before depositing fiat currency, exchanges have a mandatory Know Your Customer (KYC) process that will need to be completed.
  3. Deposit Ethereum: Send Ethereum from an external wallet to the exchange wallet. Usually, the process should take a few minutes.
  4. Convert ETH To Fiat: Users can either trade ETH directly for fiat or use the Convert function to make instant currency conversions.
  5. Withdraw Funds: Once the fiat is received, the funds can be transferred using any available withdrawal methods on the platform.

How to Sell Ethereum For Cash – Full Tutorial

1. Compare and select a crypto exchange

The first step to selling Ethereum is to decide on what type of cryptocurrency services to use. There are several options, which include fiat-to-crypto exchanges, trading platforms, decentralized exchanges, and brokerages to choose from. Centralized crypto exchanges are the most commonly used and convenient for beginners to convert Ethereum into cash and withdraw to a bank account. For this tutorial, we will use our number one pick Binance as an example.

2. Create an account with a crypto exchange

Go to the Binance home page. Click on the “Register” button to sign up.

Binance allows users to register via their phone number, email address, or Google account. Users signing up with their phone number or email address are required to provide a strong password. An authentication link will be sent to the investor's email. Once they click on it, their account is validated.

Creating an account with Binance

3. Deposit Ethereum (ETH)

Traders can send Ethereum from an external wallet into a Binance wallet. Simply copy the Deposit address for Ethereum tokens on Binance to initiate the transaction from your external source. Ethereum funds sent to this public address would appear in the Spot wallet.

Selecting ETH wallet and depositing Ethers

4. Convert ETH Into Fiat Currency

The next step is to exchange Ethereum for the preferred fiat currency before making a withdrawal. Go to the Binance Sell Crypto Page to get your preferred fiat currency. Enter the amount of ETH you want to sell and initiate the transaction.

Converting ETH to fiat on Binance

5. Withdraw Funds

Once the preferred fiat currency has been credited into the trader's account, it can be withdrawn. To do this, return to the Fiat and Spot wallet and click on “Withdraw”. Binance allows users to choose the currency they want to withdraw and their preferred payment method – including debit cards, bank account transfers, and e-wallet options. These channels come with their pros and cons. For instance, a debit card offers instant withdrawals but carries higher fees. Regarding a bank transfer, the fees charged might be lower, but the withdrawals tend to take longer.

Withdrawing funds from Binance

Enter the desired withdrawal amount and fill in all payment details. Once the withdrawal details are confirmed, the verification code can be entered, and the withdrawal is completed.

Different Ways To Sell ETH

As one of the most liquid cryptocurrencies in the market, traders looking to sell Ethereum have a variety of methods to choose from. These are some of the most popular:

  • Exchanges. Several cryptocurrency exchanges and brokers provide their services to traders, allowing them to sell their crypto holdings in minutes. A crypto exchange provides the best and most convenient option for traders looking to sell Ethereum. Some of the top platforms are Binance, eToro, and Coinbase. The top factors to consider when selecting an exchange include liquidity, regulation, fees, and payment channels accepted.
  • P2P Exchanges. Peer-to-peer trading platforms are another option for traders looking to sell their Ethereum. Some of the top P2P trading exchanges in the market include Binance P2P, Paxful and LocalBitcoins. These platforms provide a reliable and simple way to connect with other traders willing to buy ETH in exchange for traditional currencies, gift cards and many more payment options. Once a prospective trader signs up on the platform, all they need to do is to transfer the Ethereum and then search for a buyer willing to pay for the ETH.
  • Ethereum ATMs. Ethereum Automated Teller Machines (ATMs) have become increasingly popular. These machines work like regular ATMs – users can enter their crypto cards and make withdrawals, exchanging their crypto holdings for cash. According to data from CoinATMRadar, there are over 10,000 crypto ATMs worldwide. However, these ATMs are mostly spread across countries in the developed world. Investors can also sell Ethereum on these machines, but they come with fees. For instance, Coinsource claims to have the lowest transaction fee in the market, but it charges about 11% per transaction. Crypto ATMs are convenient and suitable options for users who want to quickly convert Ethereum without going through the rigors of a cryptocurrency exchange or a P2P platform. However, the sell fees are very high.
  • Spend with Debit Card. Spending crypto might be the best way for traders and investors looking to get more value from their crypto holdings. Today, several of the world’s top crypto brokers make it easy to do that by providing the best debit cards that users can easily use to make purchases with Ether. Some notable examples include Coinbase and Crypto.com. By using a crypto debit card, an investor can use their cryptocurrencies to pay for goods and services. And as crypto becomes more mainstream, avenues to spend assets are increasing.
  • Cash in Hand. Although it is far in between due to the slow crypto awareness, investors can also trade Ethereum to their colleagues/acquaintances – primarily anyone with whom they have a relationship. Here, it works like a regular P2P transaction, but now investors know the other party. All that needs to be done is to transfer the equivalent amount of ETH to the person and receive the cash.

The Fees to Sell Ethereum

Platforms that allow traders to sell Ethereum tend to charge fees for their services. These charges are usually small percentages of the selling amount, although they could also increase with the participation of third parties. For example, a trader who decides to sell ETH via an exchange must deal with the broker's withdrawal fees. However, the fees will most likely be higher if the crypto exchange connects with a third party – like PayPal or Apple Pay. The fewer people involved in the chain, the cheaper the sale.

Several platforms charge different fees for selling crypto. For instance, Binance charges 0.1% when a user decides to sell Ethereum for another crypto. However, the broker doesn't charge fees for facilitating P2P trades on its marketplace.

Best Time to Sell ETH

Except for regulations that change an asset's situation, investors are free to sell their Ethereum at any point. A trader could have a specific price goal where they'd like to sell their ETH for a profit. In this case, they would likely have to wait as long as possible to sell their Ethereum. Or, they could want to sell it immediately in anticipation of a price drop.

However, some investors also use specific strategies for their profit and investment objectives. For instance, buy-and-hold investing usually involves buying and holding an asset for a considerable period before selling. A trader simply needs to buy, store the coins in a safe place, and decide when to sell.

Meanwhile, some traders might not be comfortable staying so long in the market. For investors like these, there's a high probability of selling immediately if the Ethereum price falls. But the best investors understand that markets move in trends – so a bearish movement today could simply be a setup for an even longer bullish move down the line. The point is to build a reliable trading strategy and stick to it.

Do You Have to Pay Tax After Selling ETH?

Two things are certain in the world—death and taxes—and when it comes to crypto assets like Ethereum, this is no different. Many countries are trying to find the right taxation structures for their local crypto industries. They believe that the ability to develop this will help them build the right crypto regulatory regimes. Currently, there is no uniform crypto regulatory framework, so countries are left to pursue their regulatory policies as they see fit. Tax laws are also subject to this diversity.

In the United States, the 2022 tax return form has been updated to query taxpayers whether they've had any cryptocurrency transactions. Form 1040 states, “At any time during 2022, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?” However, even that has a footnote. The Internal Revenue Service (IRS) clarifies that taxpayers who only bought crypto with real currency aren’t obligated to answer in the affirmative.

The IRS also treats gains on cryptocurrency trades or investments as regular capital gains taxes. Investors pay ordinary capital gains taxes on short-term crypto gains – up to 37% in 2022, depending on the investor's income. However, this only applies to assets held for less than a year. Long-term capital gains taxes will be paid for assets held longer than a year but at a lower rate – usually capped at 20%. When it comes to selling Ethereum, using tax software to calculate crypto gains can make the process a whole lot easier.

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Updated Mar 11th, 2024

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