Despite cryptocurrency being as popular as it is, it still has not reached the point of wide acceptance in the mainstream. According to the research of online sources made by Rates, many businesses, startups, and individuals still do not accept it as a legitimate form of payment. However, most holders and investors would not only possess it but trade it for real currency according to https://rates.fm/. Yes, cryptocurrencies have the potential for significant returns, although their value can be highly volatile.
So if you’re in the camp of those who are unaware of how to go about converting virtual currency, for example, Bitcoin into the US dollar, you’ve come to the right place. That’s exactly what’s going to be discussed further. In addition to the conversion process, you’ll also gain an understanding of why going through the process is something worth considering.
The Story of Crypto
Before getting into the whole conversion thing, you have to know why you would have Bitcoin in the first place. Having been around for almost a decade and a half, Bitcoin is the literal pioneer of the entire crypto wave, especially in the USA. Everything that was intended for alternate currency was embodied in it. The chief innovation was the decentralized aspect of it, which took away power concerning currency from governments. This is a result of having all records kept on a piece of tech known as the Blockchain.
It’s fair to say that Bitcoin is incredibly rare for a commodity of its value which is a little over $27,000 per coin. This makes it subject to significantly less of the inflation issues traditional currency faces. Among the few other benefits of having this brand of crypto are the following:
- it’s impossible to counterfeit
- users are anonymous, making identity theft difficult
- international transactions have no additional fees
- the lack of middlemen makes transactions quicker
- they are a good bet for hedging
Why Convert into Fiat Currency?
Despite being accepted even by major banks such as Bank of America and JP Morgan Chase, not every place in the world accepts crypto. Converting into a currency like the US$ allows for greater spending and investing abilities.
For example, when you sell Bitcoin, converting into the fiat currency also makes it so that diversification of a portfolio is done pretty much upon conversion. This is because all funds aren’t tied up to one type of asset. As crypto in general is beyond volatile, anything that can allow you to expand your portfolio can make losses less impactful.
The Process of Conversion
Now that you know why conversion is beneficial to crypto investors, you can now get into the process. Converting Bitcoin into any fiat currency is a fairly easy process that involves the straightforward sale of your coins for cash. The only way to do this is by finding a platform that is built for crypto exchange. Such places include the following:
- Binance
- By bit
- Coinbase
- Kraken
To best perform any of the two methods of conversion, you have to go through the following multi-step process. This process is as follows:
Step 1: Finding a Trustworthy Platform
The first thing to do in this process ensures that the exchange of your choice is one you can trust. This will require a lot of research on your part, so be ready to be as thorough as possible. Some of the most popular exchanges that are thought of in this regard include the ones listed above.
Step 2: Creating Your Account
Between exchanges, the process of creating an account has the slightest of variations but remains mostly the same across platforms. With the exchange chosen, you use your identification documents and other things necessary to create an account through which your digital wallet is accessed.
Step 3: Transferring Bitcoin into Said Account
With the account created and the link to the digital wallet established, you can proceed with ensuring the link’s validity by transferring the coins. This is an easy feat that’s achieved by providing both your Bitcoin address as well as the amount you’re looking to send.
Step 4: Selling Your Coins
Now that the account has something in it, you can begin trying to sell it on the exchange. The first thing to do is to put up a sell order that shows the price at which you’re willing to sell your Bitcoin. Almost immediately, a match from a user looking to buy your Bitcoin will come, which completes the process and the fiat will be placed into your bank account.
Step 5: Withdrawing the Money
The account is connected to whatever bank or institution you wish to work with. Because the link between all accounts is established upon creation, all money is deposited where it’s easily accessible. From there, any withdrawal of, for example, the US$ dollar, CAD to EUR, will be straightforward.
Alternative Ways of Conversion
Though exchanges are the most common means Bitcoin owners use to convert into fiat, other paths exist. These include the use of:
- Bitcoin ATMs
- Sale of Bitcoin by face-to-face
Bitcoin ATMs, for example, which are located in about 77 countries all over the world, which happen to be places where the tech is available. As you can imagine, however, the fees required to use this method are expensive. In addition to this, they have to meet the rules of their jurisdiction, which may be inconvenient because laws concerning machinery and crypto, in general, differ across nations.
Another common path is the sale of Bitcoin by face-to-face means. This is basically when you meet your buyer in person and sell your Bitcoin directly to them. While it can work, it is nowhere near as efficient as using an exchange platform, because fluctuating prices of Bitcoin may cause disagreements that may make the entire meet-up pointless.
Final Thoughts
From the above, we can tell that using a third-party exchange platform is probably the most efficient way of getting fiat for your Bitcoin. What makes these platforms even more effective is the fact that other forms of crypto can be used in place of Bitcoin and this can include NFTs.
This is rather important because as stated earlier crypto as a whole isn’t accepted globally. The use of it in some countries is considered illegal, so using it is very much discouraged. It is for this reason that a holder looking to spend especially in these countries should have any of the above means of converting Bitcoin into fiat currency.
