Bitcoin Trading Tutorial – Update 6
This is a Bitcoin Trading Tutorial by Tebogo Motlhale
Date of Last Update : Thursday, December 28, 2017 10:24 AM
TODAY i can buy ONE cent of Bitcoin ( 0.01 ) on Binance.com for
R 1 921
the cheapest seller of Bitcoin on LocalBitcoins.com (cheapest seller in South Africa) is asking
R 2 375
for the same ONE cent of Bitcoin ( 0.01 )
he is therefore adding a commission of R454 to sell you ONE cent of Bitcoin ( 0.01 )
this means he is adding a 24% markup if he is stocking/buying his Bitcoin from Binance.com !
this seller, he currently has about R 60 000 worth of Bitcoin to sell
i will refer to this seller as “Grinderman” just to give him a Name so that we can later refer to him by name rather than calling him a CHEAP seller..LOL!
if he sells all his R 60 000 worth of Bitcoin in the next 3-4 days
he will make a R 14 400 profit on his current R 60 000 stock of Bitcoin
with his R 60 000 stock of Bitcoin SOLD OUT and a profit of R 14 400 on top
he can now go back to Binance.com and buy R 74 000 worth of new Bitcoin stock
once he sells all his R 74 000 worth of Bitcoin
he will now make a R 17 800 profit (he adds 24% commission/markup when he sells ANY amount/unit of his Bitcoin, NO matter how SMALL or how BIG the unit/quantity he sells)
he can now go back to Binance.com and buy R 92 000 worth of new Bitcoin stock
once he sells all his R 92 000 worth of Bitcoin
he will now make a R 22 000 profit
he can now go back to Binance.com and buy R 114 400 worth of new Bitcoin stock
once he sells all his R 114 000 worth of Bitcoin
he will now make a R 27 400 profit
he can now go back to Binance.com and buy R 142 000 worth of new Bitcoin stock
once he sells all his R 142 000 worth of Bitcoin
he will make a R 34 000 profit
his cumulative profit so far would be R 115 600 (nett profit ALONE . . Not including his stock-money / capital)
questions and answers
will my Bitcoin REALLY sell ?? what if my Bitcoin does NOT sell ?
answer A for question 1:
there is ENOUGH volume and turnover on LocalBitcoins.com on a daily basis. the demand NEVER STOPS and people NEVER SLEEP in that market ! i have bought Bitcoin at 22:46 PM on Sunday Night and i would get it within minutes from the seller and i have also SOLD Bitcoin on Sunday Evenings . . the highest i’ve sold was R40 000 and the buyer sent me the cash into my Capitec bank account within minutes of me posting my sell offer and it was SUNDAY NIGHT at around 20:00 PM !! you DONT even wait that long for buyers. the market on LocalBitcoins.com does NOT CLOSE, it runs 24 Hours a Day 7 Days a Week Sunday-to-Sunday . . because it is a peer-to-peer market !
answer B for question 1:
the example i make above involves the CHEAPEST seller (Grinderman), meaning that you want to always be listed among the TOP FIVE cheapest sellers . . therefore MOST buyers are ALWAYS going to buy from the cheapest seller ! AND you will be selling as one of the CHEAPEST sellers ! however if you only have R3000 worth of Bitcoin to sell, then obviously you’ll RUN OUT of stock pretty quickly and buyers will still be LEFT to buy from MORE EXPENSIVE sellers because you’re SOLD OUT !
answer C for question 1:
various Bitcoin traders bank accounts especially at Capitec bank have been frozen due to the large amount of money (deposits) they were receiving from selling Bitcoin (large number of deposits). Obviously the bank would NOT even freeze your account if you’re a poor man with a R25 000 in your bank account ! if the BANK goes so far as to freeze your account, it means YOU’RE MAKING MONEY, period !! however since this is NOT stolen money or any such thing . . the bank will quickly assist you to UNFREEZE your account after you provide them some basic documentation and set yourself clear on the source of the funds. there is NO WAY the bank will just indefinitely FREEZE your account or freeze your money because that would constitute THEFT on their part ! it’s NOT their money, it is YOUR money, no matter how you made/earned it . . it is STILL your money, especially that you made it without committing any crime, and as long as you later declare your earnings to the tax authorities/SARS then you’re very much in the GREEN. as a citizen of South Africa the constitution affords you the RIGHT to make a LIVING in whatever way or means you’re able to, as long as it does NOT involve crime/theft or infringing on the RIGHTS of your other fellow-citizens, so there is NOTHING wrong with the bank freezing your account if the money coming into your account is from LEGAL non-criminal activities, they will usually UNFREEZE it within days of you getting into contact with them. you could literally sell dirty blessed-stones from Jerusalem and charge people R500 per stone and if people BUY your “blessed” stones then so be it . . you’re making a LIVING from selling dirty stones, LOL !
what if i DONT want to involve banks ?
answer for question 2:
well, if u DON’T want to involve banks you can EVEN sell Bitcoin for HARD CASH and meetup with the buyer at a shopping mall, LocalBitcoins.com allows those types of transactions, but in that case you need to have physical security or bodyguards if at all some Nigerian druglord is going to meetup with you to buy R100 000 worth of Bitcoin from you, but again if you’re in the mall then you’re just steps away from your bank branch and there is very little that the buyer can do to try and TAKE his money back from you AFTER you have just sold him Bitcoins for cash, but if u were to DRIVE out of the mall with the cash in your hands/car . . then of course in that case you’re ON YOUR OWN and the buyer could follow you only to try to rob you a few kilometers down the road in an effort to take HIS MONEY BACK from you while you have ALREADY SOLD him the Bitcoins. I must mention thou that selling Bitcoin for HARD CASH in a physical face-to-face meetup is however EXTREMELY LUCRATIVE ! the commissions go as high as 38% ! i DONT know why anybody would want to buy Bitcoin from you for cash in a face-to-face meetup . . but let’s leave that up to your IMAGINATION and POSSIBILITIES ! LOL !!!
what about COMPETITION from other sellers on LocalBitcoins.com ?
answer for question 3:
the cheapest seller (Grinderman) he has so far made over 3000+ sales (transactions) on LocalBitcoins.com by simply listing himself as a Bitcoin seller, he is NOT even dominating the Bitcoin seller market at all on LocalBitcoins.com, every 10 or 12 minutes someone else NEW always shows up with a price that is R5 or R10 CHEAPER than Grinderman and many times during the day and during the week he is NOT even in the TOP five cheapest sellers of Bitcoins in South Africa. However these other people who surpass him with lower prices, they are NOT necessarily competing with him at all because they are barely R5 or R10 cheaper than him so there is NO CLEAR competition or a CLEAR outright winner between ALL of these CHEAP sellers. they are simply private people who each hold about R60 000 worth of Bitcoin and they are ALL selling it at almost 99% the SAME price !
what about Regulations and Compliance?
answer for question 4:
there is No license required to SELL Bitcoins, there is No need to register a business, No need to register as a company or to become a legal entity or any such. there is No need to register as a MONEY Transfer agent or a FOREX agent or to satisfy any regulatory compliance in terms of FSB or FAIS laws because Bitcoin is NOT LEGALLY recognized as a currency or even as medium of exchange in South Africa. there is NO Act of LAW (Not even the Banks Act) that regulates Bitcoin in South Africa because Bitcoin is NOT regarded as legal tender (it’s NOT regarded as MONEY or a security or an investment product or a currency or even as an asset at all), currently the exchange of Bitcoin is purely an UNREGULATED peer-to-peer (person to person) process where one person (the seller = you) is selling Bitcoin and the other person is offering rands to buy that Bitcoin from you
because Bitcoin is an UNKNOWN, an UNREGULATED and also an UNRECOGNIZED “thing” in terms of South African law, the exchange of Bitcoin is similar to you telling people that you are selling dirty blessed-stones from Jerusalem and telling them that each stone is worth R500 (similar to how some churches sell Blessed water / oil / etc) . . if the people believe in your stones being worth R500-each then that’s it . . you sell these stones to your buyers for R500-each and u keep whatever profit/markup you’re making on your R500 price !
so you just buy (stock) this Bitcoin thing at a cheap price from Binance.com and then list yourself as a local South African seller on LocalBitcoins.com (or list yourself as a local Indian seller if you’re in India) . . there is NO NEED WHATSOEVER for you to COMPETE with other sellers . . just SELL at the SAME BLOODY PRICE as the other cheap sellers who are already selling there on LocalBitcoins.com and just be BE HONEST and OPEN in your dealings with buyers and verify yourself as an HONEST seller on LocalBitcoins.com and people will start BUYING your Bitcoin from you . . that’s it
Ask the buyers to pay you via EFT transfer (almost FREE / zero-fees to receive EFT transfers & hassle-free) or you can also accept cash deposit into your bank account (a little costly . . most SA Banks charge R25 per R1000 deposit . . ouch!) and then when u see the money clearing in your bank account just RELEASE the Bitcoins RIGHT AWAY to the buyer and keep SELLING more . . SELL all of your Bitcoin away . . keeping the 24% markup as your profit ! when you run out of stock go back to Binance.com and just buy MORE stock of Bitcoin and SELL some more !
Mr. Tebogo . . so do i have to buy a minimum of R60 000 worth of Bitcoin from Binance.com ? i DONT have R60 000 capital right now . . i am broke as fuck !
answer for question 5:
Noooooooo . . that is JUST AN EXAMPLE hey !! there is NO need for you to buy R60 000 of Bitcoin stock from Binance.com my friend . . duh ! you can buy a tiny small amount of R 3 000 worth of Bitcoin from Binance.com and start from there. start selling your little R 3 000 worth of Bitcoin on LocalBitcoins.com, and collect 24% profit on it . . that’s it ! you will rapidly build up to R100k of stock and make a decent living out of it !
people are NOT going to buy Bitcoin from me on LocalBitcoins.com because they are going to know that i got it for R454 cheaper on Binance.com, they are going to BYPASS me and go and buy it directly from Binance.com, they are going to think that i’m ripping them off
answer for question 6:
Ughhhh Noooooooo my friend !! Noooooooooooo man!!! people who BUY Bitcoin on LocalBitcoins.com they either do NOT know about Binance.com or they do somewhat know about Binance.com and OTHER online marketplaces but they have NO convenient means to buy Bitcoin from Binance.com at the substantially LOWER price there on Binance.com, however it is NOT because they are “dumb” . . these people are usually extremely AFRAID and VERY SCARED to buy Bitcoin from an International company / supplier who does NOT allow them to pay with a simple and clear method that involves a local bank deposit or EFT transfer using Rands ! therefore these people they eventually end up deciding to buy their Bitcoin on LocalBitcoins.com at an unfairly HIGHER price (24%+ commission). and think about it, LocalBitcoins.com would have gone OUT of BUSINESS a loooooooong time ago if their model of doing business and their HIGH prices were UNSUSTAINABLE due to the fact they their Bitcoin price is clearly overpriced. you pay R454 MORE than the Binance.com price for buying ONE cent of Bitcoin if you buy it on LocalBitcoins.com. that means if you buy a full ONE Bitcoin then you pay R4500 MORE if you buy it locally on LocalBitcoins.com while someone else would save R4500 if he bought it internationally from Binance.com at the same moment ! i have seen people in the city of Johannesburg stocking a universal TV remote control for R8 at the corner of Troy street and Jeppe street . . and then these people would walk 3 blocks away to sit on the pavement in Eloff street and they would SELL that same universal TV remote control for R45 !!!! yep . . after they stocked it for a measly R8 three blocks down the street they would MULTIPLY its price FIVE times and sell it for R45 just a few blocks away . . and the BUYERS of this remote control would NOT KNOW better ! the buyers would be TOTALLY CLUELESS about the ACTUAL ORIGINAL VALUE of this universal remote control, they would buy it for R45 thinking that it’s still a BARAGAIN or reasonable price, but the seller would have stocked it for a measly R8 just a few blocks away . . i have the SAME universal TV remote control in my house (two of them) and they are WORKING 2 years now with NO-QUALITY problems whatsoever !
Mr. Tebogo . . i am so scared . . what happens if after i’ve sold all my Bitcoin the price of Bitcoin RISES SHARPLY and the money as well as profits i have made are now of a LOWER value than i anticipated (my money is WORTH LESS)?
answer for question 7:
Nooooooo my friend . . ughhh Noooooooooo man !!! NOT this agaaaaaain !! come on friend . . come on now . . you’ve bought something for R3000 and made 24% profit (R720) after selling all of it away . . the R3720 is now sitting in YOUR BANK account as MONEY in your pocket duh ! what has the RISING or FALLING VALUE of Bitcoin out there in the world GOT TO DO WITH MONEY that’s in YOUR POCKET ??? . . what has that got to DO WITH YOUR money and your profits ?? it’s got Nothing ! Zilch ! Nada to do with your money and your profits ! just take this R3720 and go BACk to buy/stock NEW Bitcoin from Binance.com at its HIGHER price and even if you will stock LESS Bitcoin this time around becuz its value/price is HIGHER that’s OK . . the moment you come back to list yourself as a seller on LocalBitcoins.com the current LOWEST prices will now be HIGHER duh ! so you will NOT be selling it at your previous LOW price anymore . . and you will still make your 24% markup because you (and ALL your other fellow-sellers) will now ALL be selling at a much HIGHER price on LocalBitcoins because THE PRICE has surged . . you being the seller on LocalBitcoins.com you’re IN COMMAND of the PRICE because you’re on the SELLER’s side when you’re selling on LocalBitcoins.com ! so if other sellers are now selling at a higher price of R 2 500 per 0.01 cent of Bitcoin (instead of R 1 921 – previously) you’re going to also sell yours at R 2 500 or R 2 495 per unit duh !
what if NO ONE buys my Bitcoin at all?
answer for question 8:
Ughh no man . . same question again !! Impossible ! you will be listed among the CHEAPEST sellers whenever you sell on LocalBitcoins.com. NO ONE is going to buy the SAME product from an expensive seller if there are 5 other cheap sellers who are selling the EXACT SAME THING in the EXACT SAME PLACE, unless the cheap sellers have too LITTLE stock and the buyer wants BIG stock/quantity of Bitcoin and even in that case the buyer will FIRST buy out your smaller stock at your cheaper price and then he will go on to buy the REST of his Bitcoin from the bigger sellers who have the HIGHER quantity that he needs, but obviously those bigger sellers are going to charge him a higher commission than you . . but yours will be SOLD first !
what do i do if after stocking my Bitcoin from Binance.com the price goes up before I sell it ?
answer for question 9:
well . . RAISE your price on LocalBitcoins.com and CASH in, if other CHEAP sellers are raising their prices then DO THE SAME !!! . . make MORE profit and DONT feel guilty about it !! DONT give yours away for a LOWER price because the buyers are going to quickly TAKE IT all from you when they see your carelessly LOW BARGAIN price and you’ll be SOLD out pretty quickly !
answer for question X:
if you have ANY OTHER questions, feel free to ask
** Wishing you Prosperity in the year 2018 and Beyond **