Buying cryptocurrencies has always been easier that cashing out. What are the easiest ways to to that?
Of course, true crypto warriors dislike the very idea of cashing out. Bitcoin maximalists believe that all you have to do is HODL, whatever happens. Because, you know, as they say 'when in doubt zoom out' and that explains everything.
However, there are situation when you might want to get some cash. And your crypto ways are the best - or the only! - way to do it quickly.
Cashing out Bitcoin and other cryptocurrencies can be a bit tricky. And it is definitely more difficult that buying crypto in the first place.
Knowing how to convert your digital assets to cash is essential.
Here are five effective methods to cash out Bitcoin and other cryptocurrencies instantly.
Cryptocurrency Exchanges
This is probably the easiest way to cash out crypto instantly. Exchanges like Coinbase, Binance, and Kraken allow users to sell Bitcoin and other cryptocurrencies directly for fiat currency.
There are some caveats, of course.
This method might require you to send your crypto from a non-custodial wallet to your exchange wallet. It requires you to pass the KYC procedure. And of course, as any other legal way, this one includes taxes.
How it Works:
Firstly, you create an account. Don't worry, all you have to do is just sign up on the exchange platform. Then complete the KYC (Know Your Customer) process. Transfer BTC to the exchange wallet. Place a sell order for the amount you want to sell. Here you can choose a market order for an immediate sale or a limit order for a specific price. Though some exchanges simply buy the crypto from you. That's the most convenient way. Lastly, withdraw fiat. It would land on your exchange's linked debit card.
Pros: Ease of use: User-friendly interfaces. Liquidity: High trading volumes ensure instant transactions. Cons: Fees: Transaction and withdrawal fees. Regulation: Some exchanges have strict regulatory requirements.
Peer-to-Peer (P2P) Platforms
A very popular way to sell crypto easily and fast. Though it requires some knowledge and skills. P2P platforms like LocalBitcoins, Paxful, and Binance P2P connect buyers and sellers directly. You are selling crypto to other users without intermediaries. The exchange is just overseeing the deal.
How it Works: Sign up on a P2P platform, create a sell offer, specify the amount of BTC you want to sell and the payment method. The platform then matches you with a buyer based on your criteria. Once the buyer transfers the agreed amount of fiat currency, you release the BTC.
Pros: Multiple payment options: Bank transfers, PayPal, cash, etc. Privacy: Less stringent KYC requirements.
Cons: Risk: Potential for scams and fraud. Time-consuming: Matching and completing transactions can take time.
Bitcoin ATMs
There was a time when Bitcoin ATMs were seen as the easiest way to ensure wide crypto adoption. The number of those ATMs kept rising for a while, yet now they are less popular. It was no the way Satoshi dreamt of Bitcoin, the hard core fans say.
Anyway, if you find one near you, why not use it? Bitcoin ATMs provide a quick and convenient way to sell BTC for cash.
How it Works: Locate a BTM. You can do it by using a service like CoinATMRadar. Verify your identity: Depending on the amount, you may need to provide ID. Follow the on screen instruction - don't worry, they are "for dummies". Send the BTC to the BTM’s wallet address. Wait for the machine to dispense cash equivalent to the sold BTC.
Pros: Instant cash: Immediate withdrawal. Convenience: Easy to use, available 24/7.
Cons: Fees: High transaction fees compared to other methods. Availability: Limited number of BTMs.
Over-the-Counter (OTC) Trading
OTC trading is suitable for large transactions, offering privacy and minimal market impact. Platforms like Genesis Trading, Circle Trade, and Kraken OTC provide these services.
How it Works: Reach out to an OTC trading platform.Discuss the trade specifics, including price and volume. Transfer BTC to the OTC desk, and receive fiat in return.
Pros: Privacy: Discreet transactions. Volume: Suitable for large trades.
Cons: Access: Typically requires high minimum transaction amounts. Fees: Negotiable but can be significant.
Crypto-Backed Loans
You can get some fiat cash without actually selling your Bitcoin. Or any other crypto, for that matter.
Crypto-backed loans can be found on numerous platforms. Most popular among those are Nexo and YouHodler. Basically they allow you borrow fiat currency against your BTC collateral.
How it Works: Sign up on a lending platform, then deposit BTC as collateral. Get a loan and receive fiat currency as a loan against your BTC. Repay loan - pay back the loan to reclaim your BTC or forfeit it if you default.
Pros: No need to sell BTC: Retain your BTC while accessing cash. Flexibility: Various loan options and terms.
Cons: Interest rates: Loan interest can be high. Risk of liquidation: BTC collateral can be liquidated if the value drops.
Takeaways
If you are not a dedicated hodler - oh god, how is it even possible! - you might want to try some of these ways to cash out Bitcoin.
Some of them are transparent and straightforward. Yet, they require KYC procedure. Other are fast, but might require some skills not every novice crypto user possesses.