At some point, people holding Bitcoin want to cash out or sell their digital assets, essentially exchanging it for traditional currency or Canadian dollars. This allows users access to the funds for use in their everyday lives or to choose other ways to invest.
When you understand how to sell Bitcoin in Canada, you have the potential to make a considerable profit. The process is relatively easy whether you use a Bitcoin ATM or prefer to sell on a cryptocurrency exchange. Exchanges are one viable option if you want to check out other investment opportunities.
Selling Bitcoin in Canada
Canada is among the thriving markets for Bitcoin and cryptocurrency investments, with a vast audience and a range of investment opportunities. While digital currencies are becoming more accepted as payment for online services, buying products, or investing, some users are unclear how to sell them or why.
Holding on to any investment for a prolonged period has risks, including lost opportunities when not exploring other assets to diversify your portfolio. Cashing out or selling Bitcoin and other digital currencies as a Canadian investor has several advantages.
Visit What Is Bitcoin? How To Buy, Mine, and Use It – for the fundamentals of Bitcoin. Here, we’ll explore why it makes sense to cash out or reinvest your Bitcoin and other cryptocurrencies and learn simple methods for selling.
Diversification
An investment portfolio is most effective for the investor when the assets are diverse. Selling crypto is one method for maintaining diversity since it allows capital to then add other assets to your holdings. This mitigates risk and increases the opportunity for profit.
A priority is ensuring optimal safety when selling digital currencies. Canada’s market offers an array of security measures, making it a trusted and reliable platform. Aside from encryption, two-factor authentication only gives access to the authorized user.
Maximum profit
Bitcoin can be a volatile market with prices that fluctuate drastically. These fluctuations can play to your advantage if you recognize when the time is right to sell, resulting in maximum profits. You could endure a net loss if you hold the currencies to the point that the value decreases.
It’s important to report gains or losses when selling Bitcoin to the CRA – Canada Revenue Agency. Typically, Canadian exchanges record/report all transactions, making compliance straightforward. Tax deductions are possible when you have losses to offset.
A range of options are available for selling Bitcoin and other cryptocurrencies with the potential for varying values. Despite some making the process relatively straightforward and simple, these may not be the most suitable choice for you.
An exchange
The Canadian Securities Administration and Ontario Securities Commission regulate crypto exchanges. Reputable and reliable exchanges follow standards, regulations, and laws imposed by Canada.
These online markets are meant to give the most value for Bitcoin when you set up an account. You decide the amount you want to sell, the least you’ll accept, and the currency you need.
The exchange matches offers, so you can then complete the transaction. This method requires more effort and relatively knowledgeable skills when working directly with the crypto market.
There are vast exchanges to choose from; however, for easy access, you want an exchange that allows you to connect to your bank directly, one with the lowest fees and quick deposit processing, and one that’s secure.
A broker
A broker will make the transaction on the exchange for you after you disclose the amount to sell and your lowest price. You’ll avoid dealing directly with the exchange, which can be complex when you’re less versed in Bitcoin trading; however, there are additional fees when using a broker.
The broker service gives you the option of going on the exchange to sell on your own or instantly selling.
Bitcoin ATM
A Bitcoin ATM is distinct from the standard version in a few ways. The kiosk connects to the internet to process Bitcoin and other digital currency blockchain transactions.
As a rule, the ATM allows purchases only, but some are starting to provide options for trading or selling. The crypto wallet address is needed, along with the amount to be sold and the currency type you need. Processing a blockchain sale can be virtually instant or take as long as a few hours before receiving the money.
Many Bitcoin ATMs that allow selling provide cash or will directly send the money to a digital wallet that supports the Canadian dollar. This sell option comes with higher fees, up to 10 percent. Go here for guidance on selling Bitcoin in Canada.
Final Thought
Before cashing out Bitcoin or other digital currencies, it’s important to research the most secure options to avoid a loss if the process fails. It’s sometimes worth the higher fee, such as with a broker or exchange, to have the least risk.