So many people are getting into bitcoin trading every other day regardless of the divided opinions about it. It is my guess that as you read this post now, you already know someone who has thought about bitcoin investing or is already actively in it. Also, you know that bitcoin provides a new form of investment as well as a means to quick competition of online transactions as it eliminates the need for an intermediary institution such as a bank.
While getting into bitcoin trading is not such a complicated process, soon after it is likely that an investor has made enough money to cash out or decides to completely exit the whole venture. Whichever the reason why a crypto investor needs to get money out, one needs to master the whole process of turning these digital coins into liquid money that you can touch and feel.
A few Nuggets about bitcoins
Bitcoins continue to get mixed reactions from people who support, oppose or are indifferent about it. Whatever side one belongs in, the reality is that the cryptocurrencies are getting greater attention and new investors and traders keep joining the fray every single day. To say the least, people reap in a big way from venturing in crypto yet there is also a critical number who cry foul after incurring losses. Honestly, like any other venture, mixed impressions about crypto is not strange.
Cryptocurrency prides itself as a technology that removes common bureaucracies that plague traditional fiat currency where banks are involved. As an optimist who has thrown his heart into crypto, fingers are always crossed that markets will turn out to be favorable enough for reasonable margins to be yielded.
Holding fast onto the hope that market factors will make it possible for you to actively be in the crypto market for a while, there will always be a need to move money back and forth from crypto to fiat currency.
Changing fiat currency to cryptocurrency
People have for the better part of close to six millenia gotten used to printed or minted money. This type of paper and metal money is what is referred to as fiat currency in financial terms. Crypto being a new entrant into the currency market means that it has to be linked to the fiat currency holdings.
The single way through which a new investor into crypto buys the first coins is creating a digital wallet, depositing fita currency and buying coins equivalent of a particular amount. This process is pretty simple and straightforward. In most cases, crypto exchanges each have a clear user guide on how to buy crypto on their platforms.
The most common way to change traditional money into crypto is at a crypto exchange using money held in bank accounts, debit cards, and credit cards. This information is widely spread out there and every single crypto investor you see out there who has made it big in this new field performed this same same transaction at one time
It is worth knowing the bits bricks and mortar about performing your first crypto purchase,and creating a digital wallet. Armed with this information, the initial path towards making fortunes in crypto is almost well beaten.
At the risk of being boringly repetitive, let me just remind you that the uniqueness of crypto is that it is digital money. What being digital money means is that it has all features of a currency but it isn’t a possibility to withdraw it in its form at any money point.
When you look at the various graphics put out there about bitcoin, ethereum or any other crypto in the market, they look so attractive to the eye. In fact, crypto is given a golden luster with a fine gold finish that would be very aesthetic were it possible to be withdrawn as is in real life.
You will have to completely undergo a shift in your mental frame only if you want to understand the digital nature of crypto. In case you are used to walking into a banking hall to get money cashed out for you by a teller, you may not be able to get that golden bitcoin or silvery ethereum as is in the pictures that have defined them online. Those pictures you see are just for the sake of giving users a mental picture of what the currencies are by relating them to what we already know.
There is a possibility to change your bitcoins holdings into fiat currency that can be withdrawn over the counter or at a teller machine. Whichever the currency you are dealing in, it is possible to take back your money from the trading platforms and tuck it back into the bank account or have it in liquid money.
Process of cashing your cryptocurrency holdings
There are two ways of getting to cash your bitcoins: selling them for cash money or cashing them out directly from the trading platform. The decision about which of the two methods suits you varies depending on individual realities.
It is not anything out of the ordinary reasoning that you can only sell your bitcoins for cash when there is someone willing and able to pay a reasonable amount in return. The costs involved in the process of cashing out bitcoin compared to selling to active customers may also be a factor at play.
Cashing Out bitcoins through an Exchange
Cashing out crypto through an exchange, also known as brokers, is one common way that investors can liquidate their holdings. The process is not as complicated because the exchange platform will give you a step by step guide until when the transaction is completed. You must be sure that the transaction is adequately protected from being taken over by scammers.
A little inconvenience or rather what to expect is that a transaction fee will ordinarily be charged plus it may take a couple of days (up to a week) to get the money deposited back to your account.
Here is the short process for cashing out your bitcoin investments through a broker. Choose a crypto exchange to use in selling your crypto holdings. A common exchange is Coinbase or Kraken.
- Choose the exchange, how much bitcoins you need to sell.
- The money will be paid out to your bank account in a couple of days once the transaction is approved.
- The payout can only be made to the same fiat currency bank account to which you first bought the bitcoins.
Cashing out your bitcoin at an exchange stands out as the easiest way today. As a bitcoin holder, you should individually make sure that your chosen broker does not break set laws when completing the process of cashing out the coins. Coinbase prides itself as the most popular broker exchange today.
Peer-to-Peer cashing out of bitcoins
Cashing out bitcoins through a peer-to-peer process is a quick way of liquidating your coins. There are various platforms today that allow peer to peer cashing out of bitcoins including Paxful, Localbitcoins, and Bisq.
When cashing out your bitcoins via peer-to-peer platforms, there are a few important considerations that should stand out. You can’t so recklessly expect that the P2P transactions will go on without any challenges which is why you should do the following;
- When using cash deposit, ask the buyer to deposit an equal amount to your bitcoin value into a verified bank account. To make this process free from problems, ask the buyer to share with you proof of ID and proof of payment. Until and unless these critical details are safely with you, don’t release your bitcoins.
- When your peer decides to do a bank transfer, you equally need to ask the buyer to share with you the proof of ID. You will only take the step to release the bitcoins to the buyer when the transferred funds have already hit your bank account. There is no hurry in completing the process until everything is safe and you are confident.
- Another option which may look a little manual is having a one on one appointment with the buyer and he hands over the cash to you and then completes the transaction there and then. In this case, everyone walks away confident that value has been exchanged and no monkey business may ensue whatsoever.