If you decided to buy some bitcoins a few years ago when others were still doubting whether it was worth investing in bitcoins, then today, you can already benefit from this wise decision. In order to be able to use your encrypted assets, you should learn how to cash out Bitcoin. In this guide, we will introduce the main methods of Bitcoin (BTC) cashing.
But before learning how to convert Bitcoin to cash, let us quickly understand some things to consider:
If you have been in this industry for a while, then you probably know that almost all crypto transactions require commissions. Withdrawing Bitcoin is no exception.
Unlike instant cryptocurrency to cryptocurrency exchanges (such as the service provided by Behind crypto), it may take some time to withdraw bitcoins on ordinary exchanges. Therefore, if you need money urgently at this moment, you should pay attention to other methods of withdrawing Bitcoin, such as peer-to-peer platforms or using ATMs.
Every day, there are new legislative initiatives aimed at regulating the cryptocurrency market. Therefore, before you start cashing out your Bitcoin, you should be familiar with the local laws that regulate the cryptocurrency market in your country.
The preference for choosing a Bitcoin withdrawal method may also depend on the amount of Bitcoin you plan to convert into fiat currency. If the transaction amount is large, you may need to notify the bank in person to prevent the funds in your bank account from being frozen.
Now that we have discussed the preparation phase, it is time to start introducing the most popular ways to cash out Bitcoin.
Cash-out bitcoins on exchanges
First, you need to determine the exchange used for cryptocurrency withdrawal. Although so far, not many exchanges allow their users to cash in Bitcoin, but some popular crypto exchange platforms (such as Kraken or Bitstamp) provide this feature.
The process of withdrawing Bitcoin from an exchange usually includes the following stages:
If you have not yet created an account on the exchange, you definitely need to do so. Please note that when creating an account on the trading platform, you will need to pass a verification procedure.
After entering the account, you may need to deposit a fiat currency deposit. This is essential because it helps ensure the successful linking of your bank account with the exchange account.
Now that you have created an account and made sure that all settings are correct, you need to use Bitcoin to top up your cryptocurrency exchange account.
Once the Bitcoin arrives in your account, cash it out to your previously linked bank account. After arriving, withdraw the required amount to your bank account and wait for the funds to show up. Keep in mind that it may take one to five days for the funds to be available.
Now, take the Kraken encrypted transaction as an example to summarize the transaction details, such as time and cost.
As we have already mentioned, the withdrawal of bitcoins from a cryptocurrency exchange to a bank account is not instant and may take up to 5 working days. So be patient.
The fees required to cash out Bitcoin may vary depending on the bank account selected. It is also different on the exchange platform. If you have a SEPA bank account (only for EU residents), then Kraken will provide lower withdrawal fees. Each withdrawal only costs 9 cents. If you use a US bank account, the fee is $5, which is still not much. When using other exchanges, the fee may vary from $1 to $25. However, the fee amount is usually fixed and can be disclosed to the public, so this should not come as a surprise.
Cryptocurrency withdrawal limit
If you want to withdraw cryptocurrency on Kraken, you need to upgrade your exchange account to level 2. The daily legal currency withdrawal limit is set at 100.000 USD, while the cryptocurrency withdrawal limit exceeds 500.000 USD. If you want to withdraw more money, you can do it from multiple exchanges to one bank account. But first, make sure that the bank doesn’t freeze your account for suspicious interactions.
Peer-to-peer platform (P2P)
Peer-to-peer is a transaction between two people directly. This exchange method is also called an over-the-counter transactions. If you wish to cash out Bitcoin anonymously, then this option is for you. But please note that since the other party also remains anonymous, please make sure they are not scammers. To protect yourself, please use the right p2p platform and spend some time researching the people you are trading with.
Among the most trusted and popular peer-to-peer platforms are Local bitcoins and Paxful. They have very similar operating methods and can be used in almost every country in the world.
Another major advantage of using the p2p platform is that you can choose a variety of payment methods, whether it is bank transfer, cash deposit or personal cash negotiation. No matter which option you choose, make sure to ask the buyer to provide proof of identity and proof of payment to protect yourself. After all, if you know each stage of this process, then the P2P method of selling bitcoins is pretty safe. For example, the high security of Local bitcoins is ensured through custodial services, which means buyers will not be able to access your bitcoins until you confirm the funds are in your bank account.
Consider an example, you want to cash out 1 Bitcoin through Local bitcoins. To do this, you need to create an account on the platform. After setting up an account, start looking for someone who can sell your bitcoins to. Make sure that the buyer accepts a transfer to a bank account as a payment method. Then send your request to this person. After the buyer approves your sale request, you can put bitcoin into the escrow account, and they can send the agreed amount of fiat currency to your bank account. Almost finished. All you have to do is wait for the funds to arrive, and then unlock the Bitcoin from the escrow account. Congratulations on the successful withdrawal of Bitcoin!
Withdraw bitcoins through ATM machines
The most immediate way to cash out Bitcoin is probably to use a Bitcoin ATM. In addition, since modern people interact with traditional ATMs every day, this withdrawal method may be the most familiar method for most cryptocurrency traders. Bitcoin ATMs are very similar to their “traditional brothers”: like regular ATMs, you need to have a bank card to withdraw fiat currencies (i.e. U.S. dollars, Euros, British pounds, etc.) in exchange for your bitcoins.
A big advantage of Bitcoin ATM is anonymity. Considering that you don’t need to create an account and pass verification, withdrawing bitcoin through ATM is the best way to ensure identity security.
However, if you are willing to be completely anonymous, please be prepared to pay extra. For ATM, the withdrawal fee can reach 10% of the withdrawal amount. If you find it feasible, please take the time to find an ATM in a nearby area.
How to find a nearby Bitcoin ATM
The number of encrypted ATMs is increasing every day. However, there is still very little content displayed globally. The easiest way to find a Bitcoin ATM near you is to use the cryptocurrency ATM radar app. Such apps usually provide ATM location and other detailed information such as fees, limits, and availability of buying/selling options.
After you find the ATM, all you have to do is perform the withdrawal yourself. The specific operations are as follows:
Choose the option to cash out Bitcoin on the ATM screen;
Set the withdrawal amount;
Send Bitcoin to the encrypted address provided on the screen. Make sure you have a QR code scanner installed on your phone because entering the address manually is not a good idea.
Receive your cash.
Other ways to withdraw Bitcoin
You can also use real-time encrypted transaction services to cash out Bitcoin. The owner of a SEPA bank account can use the Bitcoin withdrawal option, which allows Bitcoin to be converted to Euros.
Last but not least, another option for Bitcoin withdrawal is to use a decentralized peer-to-peer exchange, such as Hold. The main working principle of this kind of exchange is very similar to a regular peer-to-peer platform like Local bitcoins. However, there are some differences that need to be mentioned.
As we have already said, traditional peer-to-peer exchanges provide the function of custody of user funds while waiting for the delivery of fiat currency to the seller’s bank account. In a decentralized p2p exchange, Bitcoin custody is stored in a multi-signature smart contract in a non-centralized manner, thereby providing a higher level of security.
Another major difference in cashing out Bitcoin through a decentralized exchange is the anonymity of users, which means that only you decide whether to provide personal data. In short, this type of exchange is completely anonymous. In this regard, this exchange service will likely replace centralized exchange services. It is only a matter of time.
Now that you have read this article in detail, let us review the main points again.
So far, there are three main options to cash out Bitcoin. Each is suitable for a specific use case and depends on what you need most at the time: stay anonymous, pay less, or withdraw money immediately. Before you start, don’t forget to inform your bank and check the tax and legal aspects of Bitcoin cashing in your country.
Hope this article is helpful to you. If you have any unresolved questions, please add a comment below. Subscribe to the behind crypto blog and social media channels to keep an eye on the latest crypto trends, cryptocurrency price predictions, guides and tips.
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