Different Ways to Convert Bitcoin to Fiat Currency
Bitcoin is basically a cryptocurrency that is stored in a virtual wallet. It is basically a digital currency that is currently used as a form of payment. The transactions related to bitcoins take place in the blockchain network. Every bitcoin is stored in a virtual wallet and the transaction involves the transfer of bitcoin from one wallet to another. Bitcoins can be sent from peer to peer irrespective of geographical location without any intermediator in between. It works in a decentralized way, meaning nobody can interfere with the digital money, only the concerned person is responsible for the bitcoins.
Fiat currency is the currency that is issued by the government. in other terms. It is the cash, coins we generally have, that is the physical form of currency. Fiat currency ranges from USD, EUR, INR, GBP, etc.
There are lots of reasons why one might want to exchange one Bitcoin for fiat currency:
- To get a profit from the favorable market conditions like bull run on bitcoins price.
- Get more flexibility with the money.
- Fiat currency is the most common form of currency worldwide.
- Pay a bill.
- The decision to profit from favorable marketplace conditions like a bull run on Bitcoins price
Converting Bitcoin To Fiat Currency
There are many ways to convert bitcoin to fiat currency. The methods are listed below-
- Cryptocurrency Exchanges: This is the most widely used method to convert bitcoin to fiat currency. It is similar to a money exchange center which is needed when a person moves from one country to another. Cryptocurrency exchanges basically convert your cryptocurrency that is bitcoin into your local currency such as rupees, US dollars, euros. The main disadvantage of this method is the delay in withdrawing fiat currency even after completing the transaction.
Cryptocurrency Exchanges have an inbuilt crypto converter feature that displays how much fiat currency one could get with the bitcoins that person has. There are multiple exchanges available like Gemini, coinbase, binance, etc. This has a user-friendly interface that eases the whole process of bitcoin conversion. During bull run time, these exchanges are affected negatively and face technical difficulties. Coinbase seems a suitable option as it has improved over its downtime problem by increasing the infrastructure capability. Coinbase exchange sends the converted fiat money directly into your bank account without much hassle.
- Bitcoin Debit Card: Possessing a Bitcoin Debit Card is the fastest way to convert bitcoin to cash or fiat currency. The online website is provided as a user interface where the user deposits the bitcoins and the website automatically converts those into required fiat currency. Bitcoin debit cards are used wherever debit cards are accepted, the only difference being, funds are transferred from a crypto wallet rather than from a bank account. The main disadvantage is the providers of Bitcoin debit cards takes transaction charge on every purchase and also limits the total amount of transaction per debit card.in order to register for the Bitcoin debit cards, one needs to go to the bank and do KYC.
- Peer-to-Peer Exchanges: It is known that bitcoin doesn’t have any centralized authority, therefore any fund can be transferred from one peer to another. This basically involves finding a buyer who will buy your bitcoins and in return, would give cash for that. But one thing to be noted is that transactions in bitcoins are irreversible. So, choose a trustworthy buyer on whom you are sure of getting the cash after a bitcoin transaction.
- Bitcoin ATMs: It is also known as a Bitcoin Teller Machine (similar to ATM). BTM acts similar to an ATM, allowing to withdraw cash. QR code and added security features like text messages are there to ensure smooth and secure transactions. BTMs allow you to buy as well as sell bitcoins.it provides a very fast and convenient way to take cash out of a bitcoin wallet. BTMs are available in developed cities of the world and more are under construction after the boom of the digital currency era. The drawback of BTMs is they charge a heavy amount on conversion and also sets a maximum transaction limit.
- Metal Pay: It is a money transfer app that allows cryptocurrency holders to cash out. The need for this app is to complete KYC before filling up the bank details. After filling in bank details, the customer can buy, sell, send, receive as well as convert cryptocurrencies. Metal pay has the capability to convert at least 24 cryptocurrencies including bitcoins.
Top Fiat Currencies For Foreign Trade
Bitcoin trading is generally done in the following fiat currencies. These are by far the most widely used fiat currency.
- US Dollar: It holds more than 80% market share making it the most widely used fiat currency used in bitcoin trading. The reason behind its popularity is the huge userbase in the blockchain-based bitcoin network. While the other countries are yet to develop in the bitcoin field, the USA is already far ahead in this race.
- Japanese Yen: Although it has almost 7% of the total market share, it is the second most widely used fiat currency used in bitcoin trading. Japanese regulators were also some of the earliest adopters and among the most accommodating of the virtual currency.
- Euro: The currency of Europe, the Euro, ranks third on the list of fiat currencies with approx 5% market share in trading Bitcoins into fiat currency. But Europeans are confined to certain regions only while buying bitcoins. Slowly Europe is becoming a cryptocurrency hub with some of the nations accepting cryptocurrencies.