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How to Convert Bitcoin to USD: Top 10 Ways to Turn BTC into Cash

  • Alex Morris
    📚 WikiCoin

    U.Today has come up with all possible ways of converting your Bitcoins into USD. Whether you have 2 or 200 BTC in your wallet, this guide will be useful for you

How to Convert Bitcoin to USD: Top 10 Ways to Turn BTC into Cash
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When bears are reigning supreme and the FUD is being pushed by the mainstream media many investors are looking for the best way to sell Bitcoin. U.Today presents you our top 10 most popular ways of converting ways of converting to USD. This is especially helpful for beginner-level investors who are wondering how to cash out Bitcoin. Despite the crypto rout, the number of crypto investors almost doubled during the past three quarters of 2018.

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Cryptocurrency exchanges

Cryptocurrency exchanges are the top-of-the-mind option when it comes to converting BTC to USD. For that purpose, you have to use fiat-to-crypto exchanges that allow bank transfers. Coinbase is probably the most popular choice as long as exchanges are concerned, but the $8 bln dollar exchange is not available worldwide. The list of other popular fiat-to-crypto exchanges includes:

The aforementioned platforms are also called entry-level exchanges since they allow you buying Bitcoins and later converting it to fiat money. However, keep in mind that these exchanges have very few altcoins so you will have to look for C2C exchanges in the likes of Binance.   

Another important thing to remember is that you should never store your coins even on safety-cautious exchanges such as Coinbase that go as far as storing utilizing electromagnetic tends to secure their users’ private keys.

(theverge.com)

P2P exchanges

How to convert Bitcoin into cash anonymously? Those who are not big fans of centralized exchanges can engage in P2P trading, which is getting extremely popular in Latin America. Those sites allow you to get physical cash directly from a buyer by organizing a meetup.

LocalBitcoins is the Coinbase of P2P exchanges — mammoth-size trading volumes are generated on this platform on a daily basis. The modus operandi is rather straightforward given that the sides simply publish their offerings before conducting offline transactions. Still, many are iffy about using LocalBitcoins because of its rather shady reputation that was tainted by numerous stories about Bitcoin meetups going the wrong way.

(bestbitcoinexchange.io)

Alternatively, you can use Paxful. The exchange functions in the same way but offers a wider range of payment methods (up to 300). Paxful and LocalBitcoins are rather similar in their functionality but the former wins when it comes to its interface — it looks polished and beginner-friendly. LocalBitcoin, on the other hand, is much more popular and more trustworthy.         

Bitcoin ATM

Bitcoin ATMs represent an excellent way of converting Bitcoin to cash in a snap. This industry niche is constantly evolving with more than 4,000 ATMs being installed worldwide. They function similarly to ordinary ATMs (except for the fact that you have to scan a QR code with your mobile Bitcoin wallet).

(businessinsider.com)

Pay attention to the fact that you have to deal with a much higher fee (the average industry fee is around 8 percent). One more downside is that ATMs are usually installed in public places so you have to deal with limited working hours while cryptocurrency exchanges work over the clock.

You can also pay Bitcoin without actually using a Bitcoin teller machineHere are some of the most popular Bitcoin payment providers.

👉MUST READ How to Start a Bitcoin ATM Business: Is It Profitable?

Using a prepaid card

Bitcoin prepaid cards basically stopped functioning after the VISA crackdown in February. However, the major card providers have already found new issuers and they are back on track. Prepaid cards are normal cards that can be loaded with Bitcoin or any other supported cryptocurrency.

(wirex.com)

With their help, it’s a complete no-brainer to convert Bitcoin into your local currency (keep in mind that might be forced to pay a draconian Bitcoin conversion fees if your provider doesn’t support your local currency). There are certain limits but they can be easily avoidable if you complete your KYC.

Cryptocurrency lending platforms

There are numerous Blockchain-based platforms in the likes of BeeLend that connect borrowers with lenders. Notably, the Bitfinex exchange also supports both fiat and crypto lending.
 
While the fees are usually paid in fiat currencies, your crypto holdings are used in the form of collateral. This is very beneficial for cryptocurrency investors since they are not losing their crypto assets whose value can increase exponentially given the volatile nature of the industry. Borrowers are getting dollars without even selling their crypto.      

(news.bitcoin.com)

BlockFi is a nice option for US residents – it allows taking crypto loans in 35 states. In order to eligible for a loan, your wallet should contain at least $4,000 worth of crypto.  

NB! Taking a crypto loan also requires confirming your identity (you will be asked to enter your social security number)

OTC trading (crypto millionaires only!)

Traders who have huge amounts of Bitcoin could go for an OTC (‘over the counter’) marketplace since moving millions of dollars across exchanges could be challenging. These transactions are not available to the general public, and just like P2P trading, they do not affect the exchange rate.   

(news.bitcoin.com)

Furthermore, traders are also able to avoid the so-called ‘slippage’ scenario when the order is so big it causes the price can drastically fall, which will eventually result in substantial loses. It is quite possible to lose up to 10 percent of your funds due to slippage (the scenario that takes place when you show your hand before the deal is sealed).

👉MUST READ Bitcoin Nouveau Riche: Only 588 Wallet Addresses Contain More Than $10 Mln Worth of BTC

 

Given that the cryptocurrency industry is still in the early stage of development its OTC market also remains rather obscure. For your convenience, U.Today has compiled the table with the most popular OTC brokers whose service may come in handy if you want to sell more than 100 BTC.

Name of the broker  

Location   

Key features

Octagon Strategy

China

Octagon Strategy offers a top-notch level of security coupled with a large network of a trading partner.  

Genesis Trading

USA

The SEC-compliant broker supports six more cryptocurrencies apart from Bitcoin. Its total trading volume has long exceeded billions of dollars.

Smart Contract

Japan

The biggest Japanese broker that offer high liquidity and low fees. Smart Contract also offers professional consolations to its clients.    

QCP Capital

Singapore

Just like other brokers, this QCP Capital offers its clients same-day settlements. On top of that, it has rather competitive fees.  

Circle

USD (offices around the globe)

The crypto unicorn that has Goldman Sachs among its investors has a monthly trading volume of around $2 bln

Using another digital wallet

You can also convert BTC to USD by sending the coins to any supported digital wallet (PayPal, Apple Pay, etc). This option, of course, is only suitable for those who constantly purchase goods online since you receive digital fiat.

(rywalk.wordpress.com)

Again, the flexibility comes at a price – you have to deal with higher fees and lower withdrawal limits.,

Hedging against crypto loses

You can also consider using services in the likes of Coinapult, Uphold or BitUSD for storing your crypto in the form of fiat money. Of course, you may lose big if Bitcoin price unexpectedly goes up but at the same time, you avoid the risk of losing a substantial sum of money due to Bitcoin volatility (a quick reminder that the price of the flagship currency lost almost 20 percent of its value in a couple of weeks). If you decide to spend thee funds, you can convert them to USD or simply get your Bitcoins back.
Alternatively, you can also create a USD wallet on Coinbase and send BTC directly from this wallet.   

Coinaupid is the most advanced service among the above-mentioned ones since it offers you five assets (USD, EUR, and GBP as well as precious metals such as gold and silver). If you choose to convert 1 BTC into USD, Coinaupid locks its value and buys the corresponding amount of cash. Later, if the client chooses to unlock its holdings, he buys Bitcoin at the market price.

(forexmarketslive.com)

Buying things with Bitcoin

Despite the fact that Bitcoin merchant adoption is on a decline, there is still a slew of shops that accept Bitcoin as a means of payment. Overstock.com, one of the biggest retail businesses in the US, went all-in with crypto, also betting on the Blockchain technology. The fact that cryptocurrencies basically remain in a legal grey zone makes them more attractive for some retail businesses but it the same time it hinders their mainstream adoption.

Buying things with Bitcoin

Selling Bitcoin to your family and friends

If the person you know wants to buy Bitcoin, this is probably the easiest way to do a cash-out. Simply send the required amount of BTC to the recipient's wallet in order to get your dollars.    

(medium.com)

We’ve specifically mentioned ‘family and friends’ since it’s not a good idea to organize meetups with strangers. If you decided to meet someone in person make sure that the meeting takes place in a public venue (cafe, park, shopping mall, etc.).  The good thing about LocalBitcoins is that shows the public feedback about a certain person, thus minimizing the risk of being mugged. Moreover, there is no third party to help you out if you are trapped in this kind of a predicament. Still, if you are not being overly paranoid about the whole thing, selling your BTC in person remains the best option for those who are wondering how to turn Bitcoin into cash anonymously.

Conclusion

While we’ve covered all the basic ways to cash out your Bitcoins, it is still important to do your own research in order before finalizing your decision. The safest way is to go with an established cryptocurrency exchange in the likes of Coinbase but it has its downsides (higher fees, a limited amount of withdrawals, etc.). Either way, you should beware of numerous scam sites like Bitcoin Profit, which ask you to invest in Bitcoin and make unrealistic gains in no time.

How to Convert Bitcoin to USD: Top 10 Ways to Turn BTC into Cash​​​​​​​

How to Convert Bitcoin to USD: Top 10 Ways to Turn BTC into Cash​​​​​​​

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Is BTC and Cryptocurrency Crash 2018 Similar to the Dotcom Crash?

  • Denys Serhiichuk
    📚 WikiCoin

    Lots of people compare cryptocurrency market growth with the Dotcom example. This topic was extremely discussed in 2018 when most of the coins decreased in their value by dozens of percentages. Prominent figures of the industry shared their opinions that Bitcoin would face the same crash as it happened with Dotcom. In this article, we will analyze the similarities and differences between them.

Is BTC and Cryptocurrency Crash 2018 Similar to the Dotcom Crash?
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Many analysts compare Bitcoin with the largest bubbles in the economy of countries, such as “tulipmania”, which in the 17th century led all of Holland to a crisis, or an unjustified increase in the value of shares of Internet companies in the late nineties. In the latter case, the Dotcom bubble burst in 2000, and $1.5 trillion literally disappeared in a short time.

Like this situation, an unprecedented influx of funds greatly increased the capitalization of Bitcoin from the end of 2017, and by the end of January 2018, the fate of the great crypto-bubble became similar. But for all the similarity of the model, it is still early to compare Bitcoin with the Dotcom bubble and fragile economic systems.

What is the Dotcom bubble?

In the late 1990s - early 2000s, the sphere of high technologies was on an unprecedented rise. During these years the popularity of the Internet among ordinary users and among large companies reached a peak. In the wake of the HYIP, more and more new companies opened, and the old ones issued their shares to the stock exchange, seeking to attract as many investments as possible. Intensive growth in stocks continued for several years, but then almost all companies lost more than half, and about 90% of capitalization.

At this time, there was a rise in the stock market, and the NASDAQ index, determined by the rate of shares of high-tech companies, rose from a value below 1000 to above 5000 in the period from 1995 to 2000.

NASDAQ index

The Dotcom bubble has grown out of a combination of speculative investment or investment in popular products, an oversupply of venture financing for startups and the inability to generate revenue. Investors poured money into the Internet projects in the second half of the 90s, hoping that someday these companies would shoot up.

The bubble, which was formed over the next 5 years, was fueled by cheap money, easy capital, excessive investor confidence in the market and blatant speculation. Venture capitalists who were looking for a new great opportunity invested in any company whose name used the “.com” domain. Such investments could pay off only after several years of successful existence of these companies; however, investors, embraced by the desire for easy profit, ignored the fundamental calculations. Companies that were yet to start generating revenue, and often finish the product, went to an IPO, and their shares soared 3-4 times a day.

👉MUST READ When Is Bitcoin Dead, and When Is It Just a Bubble?

Within a few weeks, the stock market lost 10%. Investment capital began to flow from the market, and along with them began to dissolve the viability of the Dotcoms. The market capitalization after having reached hundreds of millions of dollars lost all value in a matter of months. By the end of 2001, most of the Dotcoms whose shares traded freely on the stock exchanges had closed, and trillions of dollars in investment capital evaporated.

The similarity and differences between the Dotcom bubble and the cryptoсurrency crash

Dotcom bubble

The main similarity between the Dotcom bubble and the cryptocurrency market is the correlation of the graphs. In both cases, the explosive growth and the repeated overcoming of the historical highs were followed by a strong decline.

In the early 2000s, Internet companies were “in vogue” and in the West, any average citizen could buy a stake in such companies. Now the whole world is talking about digital currencies and the process of buying coins has become easier.

On the other hand, the capitalization of the entire digital market even at its peak was several times lower than the capitalization of the NASDAQ stock exchange, where most high-tech companies trade. Many experts argue that digital assets have not become such a popular financial instrument so that they can be compared with stocks traded on one of the largest stock exchanges in the world.

NASDAQ and Bitcoin graphs)

In the 2000s, the Dotcom bubble burst; in 2018, the crypto market collapsed. The main question is: how to avoid major losses, using the experience of past years?

How to avoid losses when the market collapses

We should admit that at the moment the opportunities of investors are limited. The market has already managed to take off and collapse. And in the most unpleasant situation are those who bought cryptocurrency in December 2017 - January 2018, at the very peak.

Some experts argue that even in this situation, universal tactics of HODL (a distorted buy-and-hold option) will save investors.

Billionaire-businessman Tilman Fertitta, founder and CEO of Landry’s, a multi-brand corporation, expressed his point of view about the similarities between cryptocurrency growth and the Dotcom bubble, but noted that Bitcoin is real and “here to stay”.

Fertitta, who is also the leading reality show “Billion Dollar Buyer”, compared the growth of the entire cryptocurrency ecosystem with the Dotcom bubble and mentioned that people most likely just forget that the addition of “.com” to the end of the company name helped grow stocks.

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Despite numerous statements by skeptics and opponents of Bitcoin, Fertitta believes that digital currencies are not going anywhere. The main risk of cryptocurrency lies in the fact that governments of different countries do not regulate it in any way.

“Go to the bank and try to withdraw a million dollars, they don’t have the money. It’s just paper. That’s all bitcoin is, is paper, but it’s not insured by the FDIC today. And until it’s insured, a lot of people are never going to buy it,” stated the billionaire.

Another famous person in the financial industry is the co-founder and partner of the cryptocurrency company Crypto Oracle, Lou Kerner. He is confident that cryptocurrency will succeed as Amazon did, and Bitcoin investors should calm down and follow the lead of technology giant, which lost 95% of its value in two years but has now become the world's largest online store by market capitalization.

According to Kerner, the current weak position of cryptocurrency in the market can be explained by the fact that digital assets lack confidence. Meanwhile, the expert calls Bitcoin “the greatest savings that ever existed”.

“It should surpass gold over time. It won't happen overnight”, Kerner predicts.

What is more, it is foolish to sell an asset that has already lost 80-90% of the cost. The compensation will be scanty, and with long-term retention, there is a chance that, although not soon, the asset will restore its value and the investor will be able to recoup the investment. On the other hand, even leading high-tech companies took 10 - 15 years to update their historical highs after the collapse in the early 2000s.

Investors who are well versed in digital assets can now try to purchase some of them at a relatively low price.

One of the reliable ways to eliminate the risk of losing capital is to invest in new promising projects while their assets are sold at a starting price.

It can also be an excellent option for diversifying investment assets that have a real product or service.

Reasons why Bitcoin is not a bubble

Bitcoin bubble

We selected the top 5 explanations why the main cryptocurrency cannot be considered a bubble.

  • Legal exchange

One of the most serious problems of Bitcoin so far has been a cautious attitude on the part of legislators and financial regulators. They are confused by its decentralized nature and connection with criminal elements in the darknet at the dawn of its existence. However, the position of the authorities is gradually changing. In April 2017, Japan officially legalized Bitcoin as a means of payment, which immediately spurred its cost and degree of distribution in the country.

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In the Philippines, people are increasingly using Bitcoin for low-cost remittances. The country stated that it would regulate Bitcoin, thereby giving the cryptocurrency legal status and approving the use of remittances. In the near future, Bitcoin may become a full-fledged means of payment in these countries. The trend is likely to continue, given the growing demand for Bitcoin from investors and users of online payment systems around the world.

  • Demand from commercial structures

In the early stages of the Bitcoin existence, it was used as a means of payment by only a few shops (usually owned by cryptocurrency enthusiasts). Currently, the situation has dramatically changed. Bitcoin can be used with leading technology companies and online stores. The rapid rise of the Bitcoin price, media attention, and acceptance in countries like Japan have led to increased interest in cryptocurrency from commercial structures. Arguments in favor of Bitcoin in online trading are very strong: the commission is lower than on credit cards; the risk of fraud with the return of payments is zero. Cryptocurrencies allow you to reach customers in regions with poorly developed banking infrastructure and attract new, tech-savvy customers. The more Bitcoin will spread, the higher and more stable will be the demand for digital currency. And given its limited distribution in the trading environment, the opportunities for growth are truly immense.

  • The preservation of wealth in countries with distressed economies

Another reason why Bitcoin is not a bubble is that cryptocurrencies are in high demand in economically disadvantaged countries. For example, in Venezuela, Bolivia, and Zimbabwe, Bitcoin is used to preserve savings and acts as an alternative means of payment in the context of a rapid devaluation of national currencies. This is evidenced by the increase in trade volumes, inversely proportional to the value of local currencies and economic growth in problem regions.

A look inside Bitcoin allows companies and people in countries with strict capital controls to receive remittances from abroad. In other words, wherever there is a crisis in the economy, the demand and distribution of Bitcoin are growing.

  • Bitcoin has become known relatively recently

2017 was the year when the public first learned about cryptocurrency. If you asked any passerby about Bitcoin five years ago, he probably would have looked with bewilderment. Today, most people have heard of Bitcoin, and some even know that it costs more than gold. Now that Bitcoin has gained popularity, the potential demand for it from new investors is huge. Institutional investors also have started to think about investing money in Bitcoin and other digital currencies.

  • The number of Bitcoin is limited

Finally, another key reason for such a high cost of Bitcoin is that growing demand is facing limited supply. The cryptocurrency was designed in such a way that the maximum number is 21 million. In addition, the rate of creation of new coins decreases with time. Thus, the growing demand for digital currency is faced not only with a limited amount but also with a constantly falling supply. Apparently, the debate about whether Bitcoin is a bubble will continue. However, comparing cryptocurrencies and shares of Internet companies should not be done given the serious fundamental differences between the two classes of assets.

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So, is Bitcoin a bubble or not?

“Bubble or not” logo

It is logical that everyone who enters the cryptocurrency market shows some caution, especially when it comes to investment and trade. At the same time, one cannot deny the innovations brought by Blockchain technology itself.

The consequences of the Dotcom bubble not only showed how dangerous bubbles can be but also demonstrated that truly innovative and technologically advanced companies can survive the crisis. For example, Amazon and eBay, which were able to stay afloat despite all market fluctuations thanks to the creation of new ideas and a good grip.

Of course, the situation with cryptocurrencies and Dotcom will be different. Businesses implementing blockchain technologies should be guided by the experience of Dotcoms, forming their own strategy.

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