With the downturn in the cryptocurrency market, you may be wondering how you can turn your Bitcoin holding into real money. The good news is that withdrawing Bitcoin has become easier over time, and you can make a significant profit from your digital money. You just have to consider factors like tax implications, your crypto investment strategy, and exchange fees before cashing out to maximize profits. This article discusses five easy, secure, and affordable ways to withdraw Bitcoin.
What is Bitcoin?
Bitcoin, or BTC for short, is a cryptocurrency. We are sure that most of you are already familiar with the term, but for those who have been living under a rock for most of the last decade, a cryptocurrency, and with association, Bitcoin, is virtual money.
It is a digital currency that only exists online but has a certain monetary value, which can then be used for economic transactions. The beauty of Bitcoin, or any cryptocurrency for that matter, lies in its dependency on blockchain technology, which ensures that it remains decentralized, or outside the direct control of any entity or person, making it a ground-breaking innovation.
Bitcoin first appeared on the world map back in 2009 due to the action of a certain mysterious and anonymous developer, going by the name Satoshi Nakamoto. Since then, it has taken the world by storm and has even been termed revolutionary in the field of financial technology. But like others, Bitcoin also had its ups and downs.
What Happened to Bitcoin?
Since its launch in 2009, controversies and problems have surrounded Bitcoin quite regularly. Despite all the initial mistrust and wariness, Bitcoin persevered and even came out on top. Even today, when the world no longer views cryptocurrency with the same allure as it once did, it is holding strongly on its own, with a current market valuation of more than half a trillion dollars.
And it is a lot, as today nearly 21,000 different cryptocurrencies are operating on the web, with the entire cryptocurrency market valued at $1.05 trillion. But that’s not all; crypto payment revenue is also expected to nearly triple within the next 3 years. So then, what is the problem?
The issue lies with last year, when the crypto market took a sharp fall, with Bitcoin being the most affected. Today, in 2023, Bitcoin is only one-fourth of what it was at the beginning of 2022. With major controversies and fraud claims surrounding the leading crypto exchange FTX causing an implosion, the entire Bitcoin market soon found itself with a lot less trust.
While we are being cautious and not striking out on Bitcoin for good, 2022 surely was a major turning point in the story. Will Bitcoin once again rise from the ashes, or will the embers it ignited die out? For more information, watch the following video detailing the rise and fall of Bitcoin.
Is the Future Grim for Bitcoin?
After the 2022 fiasco, Bitcoin did have some breathing room in the current year as it showed a strong presence. Although it wasn’t enough to put all mistrust and doubts to rest, it surely gave the investors a much-needed respite. In fact, many analysts even believe that Bitcoin is headed for the summit once again, leaving behind the crypto winter.
But, with new regulations looming over its head and as many as nine countries outright banning the use of Bitcoin, is the future grim for this innovative cryptocurrency? It all boils down to a simple question, should you buy Bitcoin or not?
If recent reports are to be believed, Bitcoin will surely experience another drop, likely reaching $21525 by the end of this year. However, in the long run, things are looking up, as many analysts believe it will touch $45,000 by the end of 2025. Some go even further and predict that the cryptocurrency is headed for $69,000 by the end of this decade and can even touch the mythical $100,000 ceiling. Here is a table listing all Bitcoin price predictions for the coming years:
|Year||Minimum Value ($)||Maximum Value ($)||Average ($)|
Top Predictions for Bitcoin and the Cryptocurrency Industry
We are fairly sure that even without Bitcoin, cryptocurrency is here to stay, if only as a concept. However, there is no way it won’t face newer and stricter regulations going forward. It will surely result in many firms and even tokens perishing. But there is a way for cryptocurrencies to survive this grim prediction, and that is to win back consumer trust. But that is easier said than done.
Take Warren Buffett, chairman and CEO of Berkshire Hathaway, for example. As one of the most successful investors of all time, he has repeatedly shared his mistrust of everything crypto, including Bitcoin. So you can imagine that trust is a commodity the entire crypto market is in dire need of but hardly finds.
Warren Buffett still suspicious of Bitcoin
This brings us to some of the predictions regarding Bitcoin that are likely to come true in the upcoming years.
1. Losses are likely to continue
Investors should tighten their belts and hold on tightly, as it is more likely that Bitcoin and the cryptocurrency market as a whole will lose more, at least for the coming year or so. While some projects may have seen a positive outcome this year, with new regulations, things are going to turn bad before they can become good.
You may also switch to a Bitcoin alternative like Ethereum which has a slightly steady graph of volatility over the years.
2. Stablecoins gaining traction
Although Bitcoin and other cryptocurrencies have hogged the spotlight all these years, it’s high time new players emerge. One such player is highly likely to be Stablecoins. These are also virtual coins but backed by an asset in reality. Stablecoins are the supposed answer to crypto volatility. It is expected that they can replace even traditional currencies in everyday transactions and facilitate the easy transfer of assets.
3. Blockchain technology for the win
Even if cryptocurrencies do not survive, the technology they are based on has surely succeeded in leaving a mark on our history. In fact, many believe blockchain to be the next revolution in web technology. With the highly anticipated Web3, blockchain is all but set to replace the way we surf the internet. It is supposedly offering a much more private internet with a decentralized structure.
It will increase data collection efficiency, cross-verify said data using a consensus mechanism, and store all the collected data in a decentralized and immutable database.
4. Decentralized Global Trading
It is also expected that global trading will adopt blockchain technology for facilitating any exchange. It will increase the efficiency of the global supply chain, which is still described as chaotic at best.
5. The rise of NFTs
Gen Z favors NFTs. These are non-fungible tokens that have been around for a couple of years now and have many different use cases. NFTs have already made it big in the art and collectible scene and even reached out their claws to digital land purchases, music ownership licensing, and even backstage passes for some of your favorite concerts. The booming video game industry could also be the most suitable area of investment when it comes to NFTs. Here’s what Alex Atallah, co-founder of OpenSea, had to say regarding NFTs:
“The possibilities of NFTs are endless since they can be used to log ownership of any unique asset. We’re already seeing early use cases of NFTs being used as event tickets, software licenses, fan club memberships, or otherwise tied to interactive experiences.”
Ways to Withdraw Bitcoin
1. Use a cryptocurrency exchange
One of the easiest ways to Convert BTC to USD is through a centralized cryptocurrency exchange. A crypto exchange has access to different digital coins and supports multiple fiat currencies, enabling it to offer clients the most flexible way to withdraw Bitcoin. To withdraw your Bitcoin holding using the crypto exchange, also known as a third-party broker exchange, you should:
- Establish the crypto exchange to use
- Set up your account and complete the verification process
- Transfer your Bitcoin holding to the exchange
- Withdraw your digital assets by transferring them to your PayPal or bank account
It is worth noting that crypto exchanges are run by third-party brokers, so you will likely incur transaction and service fee charges. It could also take four to six days before you get your cash.
2. Opt for a Bitcoin debit card
A crypto debit card, or a Bitcoin debit card, provides one of the fastest and most affordable ways to withdraw Bitcoin. A Bitcoin debit card functions just like a regular prepaid debit card. However, instead of being connected to a bank account, the Bitcoin debit card is linked to your centralized third-party exchange account. The exchange converts your Bitcoin holding into cash and allows you to make purchases by swiping the card.
3. Use P2P platforms
Consider transferring your Bitcoin holdings anonymously to another person in exchange for cash through peer-to-peer online platforms. To cash out your Bitcoin holding using online P2P selling, you should:
- Identify the P2P platform you want to use
- Create an account
- Post your listing on the peer-to-peer exchange platform while highlighting your ideal price and payment option.
- Find an ideal buyer.
- Complete the sale. You could leverage escrow services on the P2P platforms to guarantee you do not transfer your Bitcoin holding without receiving your payment.
4. Use Bitcoin ATMs
With the growing Bitcoin popularity, the coin’s ATMs are now available across the globe. The ATMs provide bidirectional functionality, meaning you can buy and sell Bitcoin for real money using the machine. Below is how to withdraw Bitcoin via an ATM:
- Locate a Bitcoin ATM and press sell Bitcoin
- Verify your identity. You could provide identity documentation like your driver’s license
- Open your Bitcoin wallet
- Scan the Bitcoin ATM QR code to transfer your holding to the ATM address to get cash.
5. Swap Bitcoin for another cryptocurrency and then withdraw
If you signed up to an exchange platform that does not allow the selling or conversion of Bitcoin into cash, you could consider swapping your holding with another cryptocurrency. Next, convert the new currency into cash.
6. Use Bitcoin to purchase Gift Cards
Although not direct cash, you can still use Bitcoin to purchase gift cards for your favorite service. BitPay is a platform that sells gift cards in exchange for bitcoins. These cards include Amazon, Mastercard, Google, and so on.
7. Try your hands at OTC Brokerage Services
Over-the-counter, or OTC brokerage, operates within a decentralized structure and allows buyers and sellers to come together to facilitate crypto exchange. These brokers excel at handling large transactions and can be a way out for those looking to liquefy their Bitcoin holdings.
8. Bitcoin Loans
If all else fails, you can still take out a loan against your Bitcoin holdings as a guarantee. It would allow you to access cash without actually selling your bitcoins.
And lastly, we have prepared a table comparing all the different methods of withdrawing Bitcoin on their merit.
|Crypto Exchange||An online exchange and trading platform that allows users to purchase, trade, and sell cryptocurrencies.||Offers high liquidity, can be accessed by the masses, allows exchange against various fiat currencies, and supports bank transactions.||Rigorous identity verification, the risk of scams, and high fees|
|P2P Trading||Exchanging bitcoins among sellers in the secondary market||There is no need for intermediaries, it is flexible, private, and has multiple payment options.||Very limited dispute resolution, high risk of scam, non-standardized fee|
|Bitcoin ATMs||Direct selling of bitcoins||Quick, anonymous, and supports bidirectional transactions.||Not easily available, has high fees, and is unsuitable for large amounts|
|OTC Brokerage||Allows users to buy or sell to large brokers or firms||Very high liquidity, better customer experience, and better pricing||Not accessible to everyone, has high fees, and requires trust.|
|Gift Cards||Exchanging bitcoins for gift cards from various corporations or services||Wide acceptance, and much more private||Not a substitute for cash; lesser in value, chances of scam|
|Bitcoin Loans||Borrowing money against your bitcoin holdings||allows the user to retain investments for the long term, has tax benefits, and is highly liquid.||Involves interest rates over operational fees, the risk of liquidation, and loss due to call margin.|
Cashing out your Bitcoin holding does not have to be complicated. Use a cryptocurrency exchange, Bitcoin ATMs, and debit cards, or swap your holding for another currency to cash out. At the end of the day, it is up to you when to withdraw Bitcoin. If you think that it is going to go up in value, you may hold it, if not, withdraw it when you can.