Most people are interested in cryptocurrencies as a way to make money. Whether it is an extra income, some minor profits, or a full income as a self-employed trader, the opportunities are nearly limitless. Cashing out crypto profits can often be somewhat more complicated. Several options are at one’s disposal in this regard, although there is no one solution which works for everyone.
Traditional Exchanges With KYC
Perhaps the most commonly used option to cash out crypto profits comes in the form of using traditional trading platforms. Not everyone is a fan of centralized exchanges, which is only normal. Dealing with order books and going through a KYC process is not necessarily synonymous with a hassle-free experience. Despite those potential drawbacks, trading platforms remain a valuable option to convert cryptocurrency into more mainstream currency.
Several factors need to be taken into consideration in this regard. First of all, one needs to adhere to specific withdrawal limits. Depending on one’s account verification level, those limits can range anywhere from $2,000 a day to unlimited funds. Secondly, these companies adhere to strict KYC guidelines, which means they may disclose your transactions to interested governments. Avoiding the need to pay taxes on such transactions is ill-advised, albeit that remains one’s personal decision first and foremost.
OTC and Peer-to-peer Trading
Another commonly used option is to rely on OTC or peer-to-peer trading. In terms of cashing out crypto profits, it is a viable option. There will often be people willing to buy from OTC or P2P sellers at a fair price. Interested users need to ensure they do not overdo this process. Many governments target Bitcoin sellers who are, in their eyes, acting as an unlicensed money transmitter of some sorts.
For those users dealing with small amounts of cryptocurrency, LocalBitcoins and consorts are always worth checking out. This platform is available in virtually all countries and allows users to sell Bitcoin for any type of payment method they prefer. Sellers can also determine their own rates to sell cryptocurrency, which always makes things a bit more exciting. Make sure to rely on platforms offering escrow protection of some sort, as that will allow for more secure transactions.
Debit Cards Supporting Cryptocurrencies
Over the past year and a half, most discussions pertaining to Bitcoin debit cards have calmed down. That doesn’t mean this business model is no longer viable. Especially for users looking to cash out crypto profits, a cryptocurrency debit card can be a viable tool. Users can withdraw local or foreign currency from nearly all ATMs around the world, although a small fee might be added for doing so.
Similar to dealing with OTC and P2P trading, it is not something which should not be overdone. Cryptocurrency debit card providers also use bank accounts and keep logs of how their customers operate. Any user potentially funding a card with thousands of dollars and withdrawing funds every week will attract attention. That can lead to an official investigation in one’s home country if those earnings are not reported to the right authorities accordingly.
Contact a Tax Attorney or Accountant
As odd as it may sound, one of the safer options to cash out crypto profits is to directly contact a tax accountant or attorney. These individuals can aid in ensuring the crypto earnings can be withdrawn and all tax requirements will be taken care of accordingly. Since it is their job to often deal with vast sums of money they may be able to offer some alternative solutions to maximize one’s profits while remaining compliant at all times.
Options like these might not be in most people’s top 5 by any means. Cryptocurrency is often seen as a solution to bypass traditional financial systems in any way. Choosing that option can often yield unexpected and unwelcome consequences. As such, talking to an expert is a solid option. Any information or advice can be obtained free of charge without further commitments.
Disclaimer: This is not trading or investment advice. The above article is for entertainment and education purposes only. Please do your own research before purchasing or investing into any cryptocurrency.