Bitcoin demand has increased tenfold over the years. Call it the word Bitcoin that spreads like wildfire or cryptocurrency Bitcoin’s craze made people buy one. But having these digital assets has opened doors for a new world, an alternative to fiat currency.
If you’re a proud owner of Bitcoin cryptocurrency, chances are you are already minting big profits. And you must have seen the volatility of this market and how fluctuations take place hitting ground bottoms and sky touching highs. So, what next? If you are ready to cash out your Bitcoin holdings after investing it all for the long term, the question is, how would you do that? You need the money as cash in your bank account to buy real things.
Selling Bitcoin could be like buying bitcoin (perhaps in the reverse gear). To sell BTC, you must have BTC in your digital wallet first.
“Bitcoin is going to change the world from a money transactional standpoint, not just for Africa, but for everywhere.”
— Akon, Recording Artist and Producer
The cryptocurrency Bitcoin prices keep fluctuating (considering its volatility), and hence, the best time to cash out is when the prices are high. As you can purchase Bitcoin through multiple platforms, similarly, cashing it out may not have so many pathways, but there is plenty to make your selling out bitcoin journey a smooth process.
Let’s find out how to get your cryptocurrency bitcoin out as cash here:
What Is Bitcoin Cryptocurrency?
Bitcoin is the oldest, first-ever digital cryptocurrency. It is a secure digital currency bereft of government or legal bodies’ control. These are not physical assets like gold but come as digital data stored securely on the blockchain.
Bitcoin has a condition, and that is, there will only be 21 million bitcoins ever produced. It has been outlined in its source code. The Limited availability of Bitcoin also determines its value and how precious these are. It makes bitcoin a traded store-of-value commodity, like gold. The upward shift in Bitcoin lends an excellent opportunity for investors to cash out their Bitcoins and churn enormous profits.
Why To Get Bitcoin Into Your Bank account?
People are rapidly investing their money into crypto to set out returns that will pay hefty in the future. The bottom line to invest in any digital currency is replacing them with traditional currencies, and once matured to give a good return, cash them out in the bank account. Having Bitcoins as cryptocurrency that you’ve been holding for years may lend a reasonable return if you sell them when their prices rise. You can then sell your bitcoin and transfer the cash back to your bank account.
There are still a few retailers and only big platforms accepting bitcoin as a mode of payment. However, the future is near (if the bitcoin bubble will not burst) with the possibility of paying in Bitcoin. For now, you need to pay with cash, and therefore you need to cash out your bitcoin.
How To Cash Out Bitcoin?
Selling out Bitcoin cryptocurrency is like exchanging money when you visit a new country. You likely have to exchange currency at the airport or get it handy before traveling. Similarly, here you’re selling bitcoin and buying the equal value in “dollars” or the currency you choose.
The bitcoin exchange rate, like fiat currency, is not determined by the legal bodies; instead, the demand determines the bitcoin exchange. It depends on how many people are keen to buy bitcoin cryptocurrency and how much they will offer.
So, it’s not rocket science. Moving bitcoin into a bank account is like exchanging currency, but the exchange process works very discreetly, with no government involvement.
Things to Consider When Cashing Out Bitcoin
Cashing out Bitcoin holdings may not be complex, but it requires ticking a few boxes to avoid pitfalls. Having checked these boxes is important before you mark the descision to sell out your precious Bitcoin cryptocurrency.
Taxes: If you have made a profit on your bitcoin selling, you may have to pay taxes on the print income. While cashing out Bitcoins, look out for your tax year. Even third-party reputable broker exchanges may report their transactions for tax years.
Exchange Fees: Most transactions from Bitcoin account to bank account will impose exchange fees. So get ensured to read the fee percentage before you enroll for the exchange platform.
Speed of Transaction: If you are cashing out your BTC holding through a third-party broker exchange, it may take a couple of days to transfer the money into your bank account. In some scenarios, the transaction speed may even increase for a few more days.
5 Ways To Cash Out Your Bitcoin Cryptocurrency
1. Cryptocurrency Exchanges
Cryptocurrency exchanges are significant for buying or selling your bitcoin holdings. It offers a one-stop Bitcoin trading and selling. Exchanges work as an intermediary, holding sellers’ and buyers’ funds. A third-party broker exchange is also the name for cryptocurrency exchange. First, you need to deposit your bitcoin cryptocurrencies into the exchange. Once the third-party broker exchange reflects it, you can request the withdrawal in the currency you opt for.
As per money laundering laws, brokers are restricted to your withdrawals. Hence, you need to use the same bank account where you deposited the money.
This method for cashing out BTC holdings is more secure and easy but may not be the speedy way, considering it involves a third party. Although the average time interval for money to reach your account is 4-6 days, it may get more depending on the region or country.
Using crypto exchanges is easy too. All you need to do is set up an account with the platform of your choice. You may need to submit an identity verification for signing up on reputable exchanges. It’s also great to go through the exchange restrictions based on your country. You may also need to connect your bank account for Bitcoin cash withdrawal.
Once you have set up an account on the exchange platform of your preference, you need to list down a sell order, stating the type of currency you wish to trade, its amount, and your asking price per unit. Now it needs an investor to match the offer, and once agreed, you make a sale there.
When the funds get credited to your crypto account, you need to withdraw them into your bank account. The simpler it may sound reading this, it could be an extra complicated process facing several bank issues or liquidity problems.
The famous exchange platforms for selling Bitcoin cryptocurrency are Coinbase and Kraken.
Note: Be mindful of any withdrawing fees that could also be charged on the platform you choose. Also, take note the exchanges are not a reliable platform for withdrawals. They are always getting acquainted with malicious hacker activities. Having full responsibility for your funds is your job!
2. Peer to Peer Platforms
When you sell bitcoin to a buyer, you can always choose the payment platform you want the buyer to select. It results in speedy transitions with low fees levied. It is advisable to look for individual buyers from third-party brokerage to get a reasonable rate of return. To speed up selling your Bitcoins with anonymous means, you may opt for Peer-to-Peer platforms.
You can negotiate with the buyer on how you wish to accept the payment, either by bank deposit, PayPal, or the desired payment mode. Be vigilant to ask for the buyer’s proof of ID and proof of payment before releasing your Bitcoins to them.
P2P selling is ideally safer and more secure, though it is at your own risk if you’re not mindful of fraudulent activities. It is excellent to look for P2P platforms that keep bitcoins locked until the payment is securely received from the potential buyer.
LocalBitcoins is one of the most popular and leading Peer-to-Peer platforms.
3. Bitcoin ATMs
As the name suggests, Bitcoin ATMs are not actual ATMs used traditionally. They are not connected to the user’s bank account but combined to the internet facilitating Bitcoin transactions.
To simplify, Bitcoin ATMs let you scan the wallet QR code and sell it for cash. Today, Bitcoin ATMs are globally installed, and finding the location is easier than ever. The only cons are the high transaction fees charged compared with other exchange methods. However, note that not all Bitcoins ATMs offer the functionality of buying and selling.
In many cases, before letting a user operate the Bitcoin ATM, many ATMs would ask for an existing account to conduct selling operations. If not, the registration process is tedious and time-consuming. For instance, to get the things working for new users, they may need to provide a telephone number for activation and notifications, a government-issued ID, a palm scan, and a current photo taken by the ATM’s camera.
To cash out your Bitcoin cryptocurrency, the Bitcoin ATMs are great. Still, they are always under the radar, with ATM operators adjusting the settings on their machines under AML and KYC requirements falling under the jurisdiction where their ATMs are placed.
The Bottom Line
Notably, there are plenty of ways to sell your bitcoin holdings and use it to buy real things. While the world is flocking to earn real profits, the crypto world seems to be the answer for many instantly. The crypto space has grown magnanimously over the years, which means people have purchased a lot of Bitcoins.
Therefore, choose the methods mentioned below to sell your cryptocurrencies like Bitcoin and receive them in the selected currency. There are always a few gray areas you may not be aware of, so get your knowledge polished and updated with the news.
When dealing with cryptocurrency, it is always advisable to prioritize security and not fall for scams or hackers. Before taking the plunge of selling your Bitcoins, take time to learn the ropes first. Depending on the transactions, choose your crypto wallets (software or hardware), and understanding the technical requirements is crucial. The volatile crypto market is already complex, and it is easier to lose money with any wrong action. So, be mindful!