If you use common sense and follow strong security best practices, you should have no problem cashing out your Bitcoin or other crypto to your bank account. Cashing out takes only a few minutes. But always pay close attention so your transfer works as expected.
As with any other asset, there are plenty of digital criminals waiting for a chance to steal your currency. When using crypto, work only with trustworthy, large exchanges with strong policies and security to protect users and their assets. And withdraw only to a linked bank account that you own and connect yourself. Never hand over your passwords or account details to anyone. Ever.
Cryptocurrency is taxed in the U.S. like any other investment, such as investing in stocks or bonds. So if you sell your Bitcoin at a loss, you want owe any taxes. But if you earned a profit, you can bet Uncle Sam (or your local government) will want a slice.
Cryptocurrency Taxation in the U.S.
If you sell cryptocurrency in the U.S., the transactions may or may not be reported to the IRS. However, if you submitted tax information when creating your account, assume your profits will be reported to the IRS.
Even if your earnings are not reported, it’s your responsibility to track and report your profits on your tax return. There are plenty of apps, mostly paid, that help you track every crypto transaction to generate accurate tax information.
Cryptocurrency Taxation Outside the U.S.
Outside of the U.S., your transactions may or may not be reported to your local government, depending on the regulations where you live. Unfortunately, we don’t have room to cover every country here, so check your national taxation authority’s website to learn more.
If you’re on-the-go, a simple way to cash out your Bitcoin is by stopping into an ATM. While they’re not nearly as common as traditional bank ATMs, Bitcoin ATMs (BATMs) are slowly popping up in various retailers, airports, convenience stores and malls in most major cities. And while they operate similarly to a regular ATM — that is, scan a code, check your balance, receive cash — there are some crucial differences.
For one, not all BATMs allow you to purchase bitcoin and sell your bitcoin for cash, so you’ll need to find one that does. Secondly, BATMs are nowhere near as quick as a traditional ATM: The time it takes to process and complete your transaction largely depends on traffic volume on the blockchain.
If you do happen to find a two-way Bitcoin ATM, generally the process of cashing out is the same: Instead of a bank card, you’ll be prompted to scan your wallet QR code. You can then input how much Bitcoin you’d like to withdraw, based on your available balance. The BATM will display how much cash you’ll receive, and once the transaction is completed on the blockchain network, you can collect and go.
When using a peer-to-peer payment platform like PayPal, cashing out is very similar to a crypto exchange.
How to Cash Out Bitcoin on PayPal
On PayPal, start by going to the “Your Crypto” section and sell your holdings. When selling, your bitcoin instantly converts to USD. From there, you go through the standard PayPal withdrawal process for a bank account. If you’re selling for the first time, confirm your tax details.
PayPal gives you several withdrawal options. These include a paid option for faster transfer times, a linked debit card or a check in the mail. An ACH transfer is the quickest way to get your cash with no added fees.
How to Cash Out Bitcoin on Cash App
The Cash app offers a straightforward process to sell your bitcoin and cash out. To sell, open the investing tab and tap on Bitcoin. Then click the sell button and follow the prompts.
To cash out your account, tap on the balance tab and press the cash out button. Then enter the amount and make sure your account is correct. You can choose to pay more for a faster deposit time or you can use an ACH transfer free.
How to Cash Out Bitcoin on Skrill
With Skrill you start by going to the cryptocurrency section where you buy and sell. Skrill partners with external crypto exchanges to convert your bitcoin into your local currency. Once the transaction clears, you head to the section to withdraw.
Click the withdraw button and then “withdraw now” under bank account. Then follow the prompts. You have to withdraw at least $10 at a time. Most transfers complete in two to five business days.
When using Bittrex, start by selling your crypto and ensuring your funds are eligible for transfer. Two-factor authentication is required to complete the withdrawal, so you have to set that up if you haven’t already.
On the web, head to the holdings page and click the button to withdraw from your USD wallet. Verify your linked bank account, choose your amount and click the button to deposit the funds into your bank.
In the mobile app, go to the holdings page and choose USD. Then tap the withdraw button. Enter the amount, select your account and confirm. Finally, enter your two-factor authentication details and your cash is on the way to your bank.
Bitstamp offers a slightly different process when using the mobile app compared to the web version. In either case, you start by selling your currency for USD.
If you’re on the web, navigate to the withdrawal page to complete your withdrawal. In the mobile app, click on the “wallet” button to open your USD wallet. Then click the withdrawal button. Enter the amount and select your bank account. Finally, review and confirm.
Users of the Gemini exchange follow a similar set of steps to sell their bitcoin, ethereum and other holdings for U.S. dollars. Once your sale is complete, head to the withdrawal page.
To initiate your cash-out to the bank, choose the currency (USD) from the dropdown list and select your bank account as the destination. Then enter the amount and click the button to review and send your funds.
Anyone following the cryptocurrency market meltdown will likely have come across Crypto.com in ongoing news headlines. The high-profile cryptocurrency exchange has taken a big revenue hit during this latest downturn and recently laid off about 5% of its workforce.
Users who are considering cashing out their crypto can do so through the Crypto.com App. In order to cash out, you’ll need to have a USD Fiat Wallet. You’ll be able to sell or convert your crypto into fiat and withdraw via ACH transfer to your bank account.
It’s easy to cash out Bitcoin on Robinhood. All you have to do is go to the currency’s Detail page, hit Trade, and then Sell in the order window. From there, you head to your Account page, which will give you an option to transfer funds to your bank.
In the past, cashing out Bitcoin on Robinhood was required if you wanted to move your funds to a different cryptocurrency platform. Until recently clients were unable to transfer digital assets to external crypto wallets. However, with the beta launch of their Robinhood Wallet, Robinhood is catching up to the competition.