We all love the fact that Bitcoin has continuously been going up in any fiat currency value and it doesn’t seem to stop going up anytime soon. The same is true for other coins as well, which is why people buy XRP, Ethereum, and other cryptocurrencies too.
With all these gains on paper, it is also important to have a few strategies on how to cash out of crypto. We all know how mentally devastating it can be to see your portfolio go down 40/50/60/70%, even though you might still be up multiple X’s.
The Bitcoin clichés have always held true and that’s why they have been preached so much. Sayings like ‘’When in doubt, zoom out.’’, ‘’stack stats’’ have always been the right thing to do. It may be difficult to execute sometimes but with the explosive growth of Bitcoin it is extremely difficult to outperform the market and you’ll be better off if you would just ‘’Hodl’’. With that said if you are sitting on massive gains, here are 3 ways to cash out Bitcoin.
1. Spend Bitcoin
It’s probably an unpopular opinion but spending Bitcoin is a great way to cash out. There are enough Crypto Debit Card services that you can top up with Bitcoin and that also offer cash back. When you are in profit on your Bitcoin and if there are some things that you have been saving up for, then spending that Bitcoin to directly purchase those things could even earn you some cashback.
The advantage of taking profits by spending Bitcoin directly is that if the price continues to climb further you won’t miss out so much. If you would simply take all or part of your profit and leave that profit sitting in fiat (or the equivalent of fiat), you will have the security of buying whatever you want, but you will also have to deal with your emotions if the price keeps going up.
By just spending the Bitcoin that you need for a particular purchase you don’t have to care about the Bitcoin price so much and you are instantly rewarded with your purchase.
It’s also always great to say that you bought something with Bitcoin, especially things that last will last or experiences that will result in great memories.
This may be another unpopular opinion but diversifying your Bitcoin gains may not be such a bad idea. If you are open to other solutions that blockchain & cryptography technology provides then doing some research and investing some of your gains in projects that excite you is a great way to cash out of Bitcoin.
The only problem of course is that you are taking additional risk by not cashing out in a ‘’stable’’ currency and it’s usually so that if Bitcoin goes down, alts go down harder. This is of course just subjective to how much gains you’ve made and your risk tolerance.
The great thing about diversifying into alts is that you will learn a lot about all the amazing things that are possible and that are being developed. Even small amounts of money can manifest into amazing returns, which can be reinvested back into Bitcoin. One thing to note is that, if you for example buy XRP you’ll always want to measure its value against BTC, if the altcoin that you bought did not outperform Bitcoin then it would have made more sense to just ‘’hodl’’ your BTC in the first place.
The easiest way to cash out Bitcoin is through exchanges. They are a ton of exchanges available, some are large and international, and some are more local that may serve your needs better. Different exchanges have different available options in terms of buying, trading, withdrawing, spending, and earning crypto, some may be more advanced and some may be more subtle. When you are dealing with selling your crypto through an exchange and sending fiat back to your bank, you will have to deal with the ‘’dinosaur’’ banking system. Sending a wire transfer is not the most difficult thing to do but if you’re used to using crypto it can be an annoying experience. There will be fees associated for these transfers and the options are probably not available during the weekend. Until the day comes that banks have fully integrated the powers of crypto we will have to go through exchanges to cash out those Bitcoin gains.
Whether you want to buy or sell bitcoin depends on your risk tolerance, your ability to save, and your current portfolio size. It’s always a wise decision to cash out your initial investment. Also, don’t forget to enjoy life, and take opportunities to change your life when you realize those gains you cashed out from the growing price of bitcoin. Until the latter happens the cliches stay true and the best thing to do is just to ‘’stack sats’’, ‘’when in doubt zoom out’’, and ‘’hodl’’ your Bitcoin to the moon.