Is it possible to cash bitcoins
Before deciding how to cash Bitcoins, you need to clarify whether it is possible to cash Bitcoins in your country. That is, you need to decide if there is a regulation of cryptocurrencies in your country, if it exists, you need to be sure that the exchange of cryptocurrencies in your country is allowed by law.
Why do you need to know?
Clearly consider the example of India. In India, cryptocurrencies were not regulated in any way, however, the exchange of cryptocurrencies was officially allowed in the country, there were cryptocurrency exchanges that could only work with Indian citizens. All citizens of the country underwent mandatory verification and their cryptocurrency accounts were tied to bank accounts, so people brought cryptocurrency income officially to banks.
At the beginning of 2018, when Indian tax authorities realized that citizens were not particularly eager to pay taxes on their cryptocurrency incomes, the country’s authorities blocked all accounts of cryptocurrency traders and the exchanges themselves. The reason for the blocking of accounts is the lack of legislative regulation in the country. At the same time, tax audits were sanctioned against all cryptocurrency traders and exchanges.
Therefore, before you cash out bitcoin, you must be firmly convinced that the sale of cryptocurrencies is officially authorized in your country.
Where is Bitcoin cashed
If you are 100% not sure that the sale of cryptocurrencies is allowed in your country, or if for some reason you do not agree with the tax policy of your country or do not want to support the state, then it is best for you to use a trusted exchanger.
Cashing through an exchanger
Exchangers allow you to exchange cryptocurrency while remaining anonymous. For greater success and privacy, people sometimes use double or even triple exchanges.
- No need to pass verification
Disadvantages: Each exchanger has limits, it is difficult to exchange a large amount, especially if at this moment there are sharp fluctuations in the exchange rates.
If you need to cash a large amount you will have to use the exchange.
All world exchanges can be divided into 2 types:
- Adjustable by regulators
Cashing through a regulated exchange
If the exchange is regulated, it must comply with all the requirements of the regulator, namely, carry out mandatory verification of all users and report to the tax authorities about all large and not very large (upon request) transactions. At the request of the tax authorities, provide all the information on the trader’s accounts, block suspicious transactions. Tax authorities at any time can block the trader’s account on the exchange, as well as a bank account tied to it. One of the reasons for the block: did not report on taxes or tax arrears.
- Deposit protection. Regulated exchanges are required to separate the funds of traders from the funds of the exchange. If, in the event of a violation, government authorities block the exchange’s accounts, the accounts of traders will remain untouched
- The ability to officially cash large amounts
- Lack of anonymity
- In case of violation of the law, for example, if a trader has not paid taxes or cryptocurrencies are prohibited in his country, the trader’s accounts on the exchange or bank accounts attached to them can be frozen
Cashing through an unregulated exchange
An unregulated exchange is an exchange that is not registered by the regulator. But this is not necessarily an illegal exchange, it is quite possible that cryptocurrency legislation has not yet been adopted in the country of origin of the exchange.
- Ability to exchange large amounts
- Lack of security
- If the account of the exchange is blocked for violations, then all accounts of traders will be blocked, so non-regulated exchanges do not share their accounts with those of traders
An alternative to exchanges is the P2P exchange platform, where investors can independently agree and exchange their cryptocurrency.
Cashing out through P2P sites
Unlike exchangers, where the exchangers themselves set the cryptocurrency rate on P2P sites, users set the cryptocurrency rate. The problem with most P2P sites is low liquidity. If you need to cash out a large amount, this can be extremely difficult, especially if at that moment the cryptocurrency rises or falls sharply. There is a wide variation in courses, since each sets the course that he wants.
- Some sites use a deposit method to ensure transaction security.
- Low liquidity
- Not all platforms change money for fiat, they are mainly used for exchanging tokens and cryptocurrencies among themselves