How to Turn Your Bitcoins Into Cash
Investors who purchase Bitcoin often wait for years before pulling the trigger and finally cashing out. However, given the volatility of the value of Bitcoin, it’s important to be ready to sell quickly when the time is right. Knowing how and when to turn your bitcoins into cash can help you to make the most of your investment and convert your cryptocurrency into real-world cash quickly and easily.
Table of Contents
- 1 Converting Bitcoin to Cash
- 2 What Is Bitcoin Worth Today?
- 3 Best Practices for Earning Income With Bitcoin
Converting Bitcoin to Cash
There are several different methods you can use to convert your Bitcoins to fiat currency. When deciding which method to use, it’s important to consider a variety of factors, including speed, cost, and safety.
Use a Bitcoin ATM
One of the most straightforward approaches to cashing out Bitcoin is to use a Bitcoin ATM. According to Coin ATM Radar, there are over 4,000 Bitcoin ATMs in the United States alone, with the majority of them located in major urban areas. You can use a Bitcoin ATM to purchase bitcoins, or to sell them in exchange for cash or funds transferred to your debit card.
While Bitcoin ATMs may have the advantage of speed and convenience, it’s important to keep in mind that many of them involve additional fees, which can get pricey. Bitcoin ATMs may also have daily limits when it comes to buying and selling, and may offer a less favorable exchange rate than other venues. You can use Coin ATM Radar to find the Bitcoin ATM nearest you, as well as to find Bitcoin ATMs with low or no fees.
Sell on a Cryptocurrency Exchange
Cryptocurrency exchanges are sites where you can sell cryptocurrencies in exchange for other cryptocurrencies or for fiat currency. You can use cryptocurrency exchanges to convert your bitcoins into money that is then deposited directly into your bank account.
There are a variety of different popular cryptocurrency exchange platforms currently in use, including Coinbase, CoinJar, Kraken, and more. Keep in mind that many cryptocurrency platforms require you to make a purchase with the same bank account that you use to withdraw funds.
- Coinbase — Coinbase is one of the most popular cryptocurrency exchange programs in the world. The platform is user-friendly, with reasonable fees.
- CoinJar — Coinjar is another popular cryptocurrency exchange platform. They offer convenient payment methods and a free e-wallet in which to store Bitcoin and other cryptocurrencies.
- Bitbuy.ca — Based in Canada, Bitbuy.ca allows Canadians to buy and sell cryptocurrency on a convenient, dependable, and secure platform. While Bitbuy.ca is currently only available to Canadian citizens, they offer an easy-to-use platform with low fees and great customer service.
- ChangeNOW — ChangeNOW is an instant cryptocurrency exchange platform. It doesn’t require user registration and supports over 170 different cryptocurrencies, making it a fast and flexible option for those looking to buy or sell.
- Kraken — Founded in 2011, Kraken is another popular cryptocurrency exchange platform. While their interface is more complicated than some other platforms, they offer low fees and excellent customer support.
Selling on a P2P Exchange
If you’d like, you can directly sell Bitcoin to interested buyers using a P2P exchange. P2P exchanges allow individuals to buy and sell Bitcoin directly from one another. Unlike Bitcoin ATMs and cryptocurrency exchanges, P2P exchanges often involve only minor trading fees.
While P2P exchanges are generally safe, it’s important to do your homework and make sure to deal with only reputable buyers and sellers. Depending on the platform, you can receive payments in the form of cash, MoneyGram, or even gift cards. There are a variety of popular P2P exchange platforms, including Bitsquare, LocalCoinSwap, PAXFUL, and more.
Using Bitcoin on Debit Cards
Bitcoin debit cards are another popular way to convert Bitcoins into cash. Essentially, Bitcoin debit cards allow individuals to deposit their bitcoins onto a debit card that converts them to fiat currency for everyday use. Bitcoin debit cards can be used just like regular debit cards to make purchases online and in person. Many vendors also sell prepaid debit cards in exchange for Bitcoin.
What Is Bitcoin Worth Today?
To ensure you’re being offered a reasonable sum in exchange for your cryptocurrency, it’s important to ascertain the true value of your Bitcoin. There are a variety of resources that can help you calculate the value of your Bitcoin, as well as the exchange rates for converting it into various different forms of fiat currency.
Bitcoin Cash Value
The value of cryptocurrency is highly volatile, and Bitcoin is no exception. With a peak value of nearly $20,000 per coin in October of 2017 to a valley of just over $3,000 in August of 2018, Bitcoin has historically fluctuated wildly in value. In 2019, the value hovered just over $9,200. When it comes to turning a profit off of your Bitcoin investment, it’s important to track the relative value of your Bitcoin, and to cash out when Bitcoin is experiencing a surge in price.
Bitcoin to USD Calculator
Because Bitcoin can be traded in very small increments (the smallest amount you can buy is one Satoshi, which equals 0.00000001 bitcoins), the price per coin can be an imprecise metric. You can use a Bitcoin to USD calculator to calculate a more precise value for your investment. This allows you to gain a more accurate understanding of just how much your investment is worth, and can provide valuable information if and when you decide to sell.
Best Practices for Earning Income With Bitcoin
Like any investment, investing in Bitcoin isn’t a get-rich-quick guarantee. However, savvy investors can stand to make a tidy profit on their cryptocurrency investments. The following practices will help you become a savvy investor in Bitcoin and sell when the time is right.
Being an Informed Investor: Buying and Selling at the Right Time
The golden rule when it comes to investing is to buy low and sell high, and Bitcoin is no exception. Given the volatility of cryptocurrency, it’s difficult to anticipate the peaks and valleys of Bitcoin’s value. Nevertheless, readers can keep abreast of new developments in the world of cryptocurrency in order to anticipate market changes and make smart selling and purchasing decisions.
There are a variety of pertinent news organizations that help investors stay up to date, including:
Keeping Your Finance Secure
When it comes to buying and selling cryptocurrency, it’s important to keep your finances as secure as you would when it comes to any other financial transaction.
Don’t store your private keys on online services or entrust them to others, as this makes you vulnerable to hacking and fraud. In addition, you can back up your Bitcoin wallet by copying the private key to a private device. Finally, you shouldn’t invest any more money than you are willing to lose. This will ensure that you stay in the black even if the market goes sour.
While Bitcoin can be a great way to profit off of your investment and earn some extra cash on the side, you shouldn’t gamble your life savings on cryptocurrency.
According to the IRS, cryptocurrency is a taxable asset, and Bitcoin exchanges will typically report transactions. In order to ensure you’re prepared at tax time, it’s a good idea to keep records of your transactions, and to withhold some money so that you won’t feel the sting during tax season.
Bitcoin has become more and more popular in recent years, both as an investment strategy and as an anonymous and independent currency in and of itself. As with any investment, Bitcoin isn’t a foolproof way to turn a profit. With a little know-how, however, Bitcoin can be a worthwhile part of a diversified investment strategy.
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This post was updated January 6, 2020. It was originally published January 6, 2020.