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I sold a 3G and a water-damaged 4 about 18 months ago. Both went to overseas buyers and both went for much more than I would have expected. I wiped both before listing. Received payment in full and never had any issue since. My understanding is that the iPhone is not universally available and out-of-contract phones are in demand. My hunch is that if you limit your listing to domestic sales you'll see the bids come in substantially lower.
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