Remember That Volatility Is The Name Of The Game
Cryptocurrency is volatile by nature. Because crypto generates no cash flow, traders have to rely on changes in sentiment to drive the price. That means the market can swing between rabid optimism, as it did in early 2021, to pessimistic despair, as it did a few months later. The furor around the Coinbase IPO also helped drive positive sentiment to crypto.
So when you have an asset thats driven by sentiment, you have to realize that the emotions of traders propel the market. Thats true in the case of stocks, too, but they also may have a real stream of growing cash flows from their issuing company to accelerate them higher.
This volatility is exactly what draws professional traders, who use high-powered algorithms to make sophisticated trades, something that mom and pop traders dont typically have the advantage of utilizing. Traders like volatility since it gives them a chance to make money thats Wall Streets game.
How To Withdraw Ethereum As Cash
The most common way to cash out Ethereum is by selling Ethereum for cash using a crypto exchange. Heres how you can do that
How To Cash Out Cryptocurrency A Straightforward Guide
How do you convert Cryptocurrency to cash? Can you sell your Cryptocurrency for cash? Read on to learn how to cash out Cryptocurrency here.
A cryptocurrency is a great option to have an alternate system of currency. If your cash loses value, you have cryptocurrency as a backup.
You can also use cryptocurrency as an investment. We have all been following the growth of Bitcoin and heard fantastic stories of people who became millionaires overnight with Bitcoin.
While Bitcoin and other cryptocurrencies may not have as rapid growth as before, they have become an accepted form of currency in many jurisdictions.
More people are investing in cryptocurrency. But have you ever wondered how to cash out cryptocurrency?
Cashing out cryptocurrency has many benefits. We can build our fiat capital by converting cryptocurrency to fiat currencies. We can also use it as a payment method for retailers that do not accept digital cash.
This guide will show you how to do this.
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How To Sell Bitcoin: 5 Ways To Cash Out’ Your Btc Holdings
How do you sell Bitcoin? is one of the first questions that arise when people become interested in buying cryptocurrencies, since getting your money out is just as important as investing.
Selling Bitcoin can be similar to buying Bitcoin, except in a somewhat reversed process. To sell BTC, you must first have BTC on hand in your wallet.
Buying Bitcoin is possible via a number of routes. When you are ready to sell some or all of your Bitcoin, you can do so through a variety of avenues, including an online cryptocurrency exchange, direct peer-to-peer transactions online or on-site, and through a Bitcoin ATM.
Sell Cryptocurrency With Localbitcoins
Based in Finland, LocalBitcoins is perhaps the best-known site for private, direct crypto-to-fiat transactions worldwide. Its a semi-anonymous service that focuses on simplicity and privacy, offering in-person, local exchanges of crypto assets and online transfers backed by on-site escrow. The site displays the number of transactions, feedback scores and response times for every user, for safer decisions.
LocalBitcoins uses Bitcoin as its base currency and focuses on fiat transactions, but supports Litecoin, Ethereum, Dash, Monero, and Ripple exchanges. To convert altcoins to fiat, you must first sell them for bitcoins, then sell the bitcoins for fiat.
LocalBitcoins transactions are person-to-person. List the amount of crypto youre selling, your upper and lower volume limits, and your price. Choose a payment method including in person, bank transfer, online payment processors, or even cash by mail and put your crypto into the sites escrow.
Theres on-site messaging for direct communication with your buyer, who has 30 minutes to provide your money if youre working with online or bank transactions. When you receive your fiat payment, you release your coins to your buyer from escrow. Theres mediation if things go wrong.
Note that LocalBitcoins is not available in New York because of Bitlicense regulations.
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How To Convert Cryptocurrency To Cash In 2021
In this article, I will show you the easiest way to convert cryptocurrency to cash in 2021.
I will also give you a step-by-step guide exactly on how to exchange your crypto for cash, so keep reading.
The way to do it is through the trading platform Coinbase.
The steps you need to take to be able to sell cryptocurrency on Coinbase are the following:
Coinbase is a fully regulated and licensed cryptocurrency exchange from the USA and its also one of the most trusted exchanges when it comes to money transactions and storing coins.
The only thing you need to do is to connect your bank account with a first deposit and then you can convert cryptocurrency to USD or any other fiat currency.
It takes a little bit of time to transfer the coins to Coinbase and then get connect to your bank account but its definitely the easiest and safest platform to do it.
To sell cryptocurrency for cash on Coinbase takes about 2-5 workdays before you will see your money in your account.
How To Cash Out Bitcoin Using A Broker Exchange
So, now that you know the difference between the two favored methods, I will now show you how to withdraw Bitcoins to cash using broker exchanges!
Coinbase is the most popular broker exchange for buying and selling Bitcoin. They process more Bitcoin transactions than any other broker and have a massive customer base of 13 million.
- Withdrawal Methods: Coinbase lets you sell Bitcoins for cash, which you can then withdraw into your bank account. You can only cash out your Bitcoin into a bank account that you have already used to buy cryptocurrency on Coinbase. So, if you havent done this yet, I recommend purchasing a small amount of cryptocurrency first.
- Fees: The fees depend on the country that your bank is located in. For example, if you want to sell Bitcoin for USD, a wire transfer is $25. If you are located in the EU and have SEPA, then this costs just $0.15!
- Cash-out times: Withdrawal times also depend on the country that your bank is located. US withdrawals normally take between 4-6 working days, while EU withdrawals take 1-3 working days.
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Figure Out Which Currency You Want To Cash Out In
That means the first thing you need to do is decide which form of money you will accept for your Bitcoin.
If you are in the US, you probably arent looking to sell your Bitcoin for Euros or Pound sterling .
Thats important, because some services dont support US dollars.
Heck, some exchanges dont support fiat currency at all.
Whats Behind The Latest Bitcoin Drop
Many investors see Bitcoins price swings as part of the game, but volatility is tough for individual investors to deal with, Noble says. Like Yang, he warns against selling too fast.
While this recent drop is reminiscent of 2017s sell off, Bitcoins presence has grown a lot since then. New short-term investors who are selling their holdings in reaction to the drop may be influencing the continued dip in Bitcoins value, according to a recent report from Glassnode Insights, a blockchain analysis firm.
While fluctuations are expected, Noble says this swing is a bit out of the ordinary. I thought the market was maturing and these things would be less frequent and severe. Boy was I wrong, he says.
This particular drop was caused by a combination of factors that may have made this drop more severe, Noble theorizes, from excitement about low-quality coins, to negative remarks from Elon Musk, to Chinas latest crack down on crypto services. The accumulated response made this sell off all the more violent, says Noble.
He likens the drop to the stock market crash of 1987, from which the markets took months to recover. But because crypto moves a lot faster today than equities did in the 1980s, Noble says we may see a quicker recovery.
Dont panic and puke, Noble says. If you keep your positions small, you can try to tolerate the volatility.
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Withdrawing Your Funds After You Sell Bitcoin
If you’ve sold Bitcoin through a platform that permits fiat currency withdrawals, check to see what withdrawal methods are supported. Options may include:
- Bank transfer
When choosing your withdrawal method, make sure you consider:
- Fees. Many platforms impose a withdrawal fee, and the fee charged usually varies depending on the withdrawal method selected.
- Limits. Are there any minimum or maximum limits on how much you can transfer? How do they differ between withdrawal methods? Can you increase these limits by providing additional verification or ID?
- Processing times. How long will it take for USD to arrive in your wallet or bank account? For example, while cash withdrawals are instant, bank transfers can take several days to arrive.
- Any other restrictions. For example, some exchanges will require you to withdraw funds using the same payment method with which you made your deposit.
Storing your cryptocurrency on an exchange for the long-term is not recommended. Exchanges control the private keys to these wallets and are also popular targets for hackers. The safest option is to transfer your cryptocurrency into your own secure wallet that lets you retain ownership of your private keys. It’s a good idea to set this wallet up well in advance of selling your Bitcoin and make sure you double check your wallet address before depositing any funds.
Example : Business Income Or Loss
Alice regularly buys and sells various types of cryptocurrencies. She pays close attention to the fluctuations in the value of cryptocurrencies and intends to profit from the fluctuations. Her activities are consistent with someone who is engaged in the business of day trading. In 2017, Alice sold $240,000 worth of various cryptocurrencies, which she originally purchased for $200,000. Her net profit is $40,000. Since Alice is actively trading in cryptocurrency, which is a commercial activity, she has to report business income of $40,000 on her 2017 income tax return.
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Receive Crypto On Cold Wallets
1. Hardware wallets
Cold wallets come under the form of USB flash drives and are the safest way to store and transfer cryptocurrencies. While they do access the blockchain online, your funds are as safe as your USB flash drive is. With the progressive adoption of blockchain and cryptocurrencies, several companies have created their cold wallets, the two main ones at the moment are:
Other names are well reputable and worth your attention too but we will consider these two as the main ones as they have been in business for years, before anyone else, which is a plus when it comes to matters like storing money.
2. Paper wallets
A paper wallet consists of a print or a hand-written note of your private keys. As such your funds are as safe as the paper your private keys are written on is. Keep in mind, however, that your private keys should not be copied and pasted for optimal safety of your funds so that this precious information does not stay in your computers clipboard. The same goes with printing it
If you write your private keys directly from your screen, make sure you copy the address right and that your computer is totally virus free.
This is why, at all times, it is paramount that you keep the control over your private keys. While you can convert crypto to cash instantly on exchanges, if you store cryptocurrency on them, they are in control of your private keys and you are not, with all the collateral risks that implies.
Wait For Your Funds To Arrive Into Your Bank Account
Thats how you withdraw funds on Coinbase! Once the transaction is set, you need to wait a few days for the funds to arrive in your bank account or selected method.
Normally, Coinbase tells you the approximate Withdraw Time, but some users report that it usually takes way less time than they state – good for all of us!
You can now start using your crypto funds whenever you want! Was this article helpful? If so, dont forget to check all of the other content we have for you in GrowFollowing.
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Understanding Coinbase Cryptocurrency Exchange
All customers who opt to use cryptos on a daily basis should be able to transfer their funds whenever they want.
Thats what Coinbase is for. For example, if you need to trade, exchange, sell, buy or make any crypto-related transaction, then this platform is for you.
Of course, in the real world, you can only access these funds with FIAT currencies, such as the United States Dollar or the British Pound Sterling . You can learn more about the Coinbase withdrawal process at this link.
What Is The Best Way To Sell My Bitcoins For Cash
There isn’t a best way to turn your bitcoin into money because everyone has their own needs and preferences in mind at any given moment regarding what they expect from an experience like this. So whether you decide to use an exchange platform with trading capabilities or meet someone face-to-face, you’ll have a ton of options to choose from right now. Just do your research so that it’s convenient and easy for you!
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Is It Business Income Or Capital Gain
The income you get from disposing of cryptocurrency may be considered business income or a capital gain. In order to report it correctly, you must first establish what kind of income it is.
The following are common signs that you may be carrying on a business:
- you carry on activity for commercial reasons and in a commercially viable way
- you undertake activities in a businesslike manner, which might include preparing a business plan and acquiring capital assets or inventory
- you promote a product or service
- you show that you intend to make a profit, even if you are unlikely to do so in the short term
Business activities normally involve some regularity or a repetitive process over time. Each situation has to be looked at separately.
In some cases, a single transaction can be considered a business, for example when it is an adventure or concern in the nature of trade. Whether you are carrying on a business or not must be determined on a case by case basis. For more information, please review our archived content on an adventure or concern in the nature of trade.
Some examples of cryptocurrency businesses are:
- cryptocurrency mining
- cryptocurrency trading
- cryptocurrency exchanges, including ATMs
Government Regulations And Laws
One of the biggest problems with being successful in cryptocurrency investing and trading is that the regulatory landscape is such a mess. Every country and every state has its own legislation, its own regulations, and its own quirks.
If youre serious about crypto and are dealing in large sums, youll have to address tax issues. If youre hoping to bank in crypto or open an account at a private bank , youll have to handle documentation and the way they still give you a sideways look when you mention crypto!
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How To Sell Cryptocurrency For Usd
If you live in the USA or any other country and you want to convert cryptocurrency to USD you are very lucky.
The way to sell your crypto for USD is very simple.
The only thing you need to do is to create an account on Coinbase and then connect your bank account.
Coinbase is one of the best cryptocurrency and altcoin exchanges on the market today.
The way you do it is to make the first deposit with your bank account.
Then when its connected to the exchange you can convert crypto to USD into your bank account.
The transaction might take anywhere from 2-5 workdays, but thats worth it if you want a safe way to cash out your cryptocurrency.
Now you know how to sell cryptocurrency for USD and if you need a guide to help you, check the step-by-step guide at the beginning of this article.