Gareth Johnson
Gareth Johnson
Updated on November 16, 2021

The main reason why people invest in cryptocurrencies is to make a profit from the high volatility of the market. Unlike company stocks, gold, or oil, which have relatively stable prices with minor to moderate fluctuations, cryptocurrencies are very volatile and their price changes are never fully predictable.

Experienced crypto traders might know how to recognize when a price change for a certain asset or the whole market is about to happen, but there aren’t any sure-fire signs. This unpredictability of the market means huge profit opportunities for investors and brokers that succeed in taking advantage of the circumstances at the right moment.

When you do manage to profit from trading with cryptocurrencies, no matter whether it’s Bitcoin (BTC), the main crypto player, or some altcoin, you need to find a way to securely cash out your coins into real-world, fiat money. Knowing when to cash out is very important, because a profitable trade can quickly turn into a disaster if the coins you just gained start rapidly losing their value.

In this guide, we are going to take a detailed look at some of the most popular cryptocurrencies, with special focus on altcoins and how to cash them out. The process really isn’t complicated and there are multiple methods for safely cashing out your digital currencies.

Why Invest in Altcoins at All?

The cryptocurrency market has tremendously evolved since the launch of Bitcoin as the first digital currency back in 2009. Thousands of developer teams have launched their own cryptocurrencies since then and presented users worldwide with countless functionalities that aim to differentiate them from the rest of the market. However, only the best projects manage to achieve widespread popularity and acceptance.

Hand holding magnifying glass looking at growth of investments

For crypto beginners, a good indicator for successful cryptos is the first page on Coinmarketcap, which shows the top 100 digital currencies in terms of market cap and trading volumes. These top 100 crypto assets stand out from more than 10,000 cryptos because they provide real value and functionalities to their users, so you can’t just narrow down cryptocurrencies to Bitcoin and Ethereum, when there are so many promising projects on the market.

Some cryptocurrencies are made to be digital cash, good for facilitating payments, transactions and storing value, while other projects have much broader use cases, such as powering smart contracts and decentralized applications. All in all, blockchain technology has enabled developers to explore thousands of possibilities and use cases for cryptocurrencies, at the same time creating thousands of market opportunities for crypto investors.

Popular Altcoins

Here is a careful selection of some of the most popular, trending altcoins, that clearly illustrate the different functionalities cryptocurrencies can provide their users.

Ethereum (ETH)

Ethereum is regarded as the main altcoin on the crypto market. Its market cap is only surpassed by that of Bitcoin, while no other altcoin is even remotely near the trading volume and market capitalization of ETH. What makes Ethereum so widely accepted is the fact that it’s much more than just digital money.

You can use ETH for all sorts of financial transactions of course, but the open-source Ethereum programming resources are actually made to provide developers with the means for powering smart contracts. These contracts are self-executing agreements that enable programmers to automate all sorts of complex business processes, such as payments, transactions, and conditional operations in supply chains and production facilities. 

Also, smart contracts are ideal for creating decentralized applications on the ETH blockchain, which can be put to use in various different industries, including decentralized finance (DeFi), retail businesses, educational institutions, healthcare, gaming, etc. Decentralized apps created with the help of the ETH programming language Solidity and the Ethereum Virtual Machine are fully independent of big data web resources and can’t be unplugged by any central server or authority. Some of the most popular ETH-based decentralized apps are Uniswap, CryptoKitties, IDEX, and Axie Infinity.

Physical ETH coin on hand with trend on background

The ETH blockchain is also great for building new, third-party cryptocurrencies on it – so-called ERC20 tokens that use the Ethereum blockchain as a base for their own blockchain. Some of the most popular ERC20 tokens are cryptocurrencies from the top 100 on Coinmarketcap like OmiseGO (OMG), Chainlink (LINK), and Basic Attention Token (BAT).

Litecoin (LTC)

Litecoin was launched back in 2011, just a couple of years after BTC, and it aimed to provide users with similar decentralized cash functions like Bitcoin, with some major improvements. While BTC blocks are produced every 5 to 10 minutes on average, Litecoin aims to shorten this time considerably. An LTC block is created every 2.5 minutes, which means that the network generally works faster than the BTC blockchain. LTC’s blockchain basically copied the original Bitcoin blockchain and added a few upgrades to produce blocks faster.

Bitcoin Cash (BCH)

Bitcoin Cash is another digital cash focused crypto, but unlike Litecoin, BCH was launched in 2017 as a hard fork of the original Bitcoin blockchain. A hard fork happens when part of the community around a certain crypto wants to implement some drastic changes to the blockchain, but the rest of the community wants things to stay the same. 

When part of the BTC community wanted to increase the blockchain block size from 1MB to 8MB, a huge disagreement happened and the Bitcoin blockchain got forked, creating the BCH blockchain in the process. Bitcoin Cash has remained a high market cap cryptocurrency ever since, because it could include much more transaction data in each block, but it didn’t manage to even remotely reach the popularity of the original Bitcoin.

Ripple (XRP)

Ripple is a great example of how cryptocurrencies can provide meaningful innovation for corporations, saving them time and money. XRP runs on a distributed consensus ledger which has numerous validator points that process transactions. This system allows as much as 1,500 transactions per second, and it also has a built-in currency converter utility that enables lightning-fast, cross-border payments, and transfers because currencies are instantaneously converted.

Physical Ripple coin

The Ripple network pulls the best exchange rates from exchange platforms and enables users to convert their currencies in a matter of seconds. This is great for business transactions and payments because the whole classic banking system and its long waiting periods are evaded with direct transactions on the XRP network.

Tether (USDT)

Tether is one of the most popular stablecoins on the crypto market. A stablecoin is a cryptocurrency whose value is tied to a fiat currency. Tether’s value is tied to the US dollar and the value of a Tether coin never changes. This makes it an ideal currency for traders to exchange volatile currencies to. For instance, when a trader makes a huge profit from the price fluctuation of a very volatile low cap cryptocurrency, it’s a good idea to exchange that currency for a stablecoin like Tether, so that when the price of the original coin starts dropping, the trader saves all his profits in the form of Tether. Other popular stablecoins include the USD Coin (USDC) and Binance USD (BUSD).

Monero (XMR)

While Bitcoin and similar cryptos offer great cash transaction services, they don’t really provide user privacy. Instead, users are only pseudonymous while using BTC. That’s why privacy-focused cryptos like Monero were invented. Just like Bitcoin, Litecoin, and Bitcoin Cash, XMR is also primarily used as digital money. The thing with Monero is that it’s untraceable and offers full privacy to both the senders and receivers of this crypto. 

XMR uses special ring signatures to protect the true source and destination of a transaction. Also, even the amount of Monero coins that are being transferred can stay private. For users that really value their privacy and don’t want to leave a digital signature behind with their online purchases and transactions, Monero is the best choice. 

Cardano (ADA)

Cardano is similar to Ethereum in many ways, because it provides users and developers with a broad range of tools for launching smart contracts and decentralized applications in various industries. The main difference between Ethereum and ADA is that ETH runs on a proof-of-work network that needs miners and a lot of computing power to process transactions and power the blockchain, while Cardano uses a proof-of-stake consensus mechanism to validate transactions. Cardano’s system doesn’t require much electricity and there aren’t any miners because the users themselves stake their assets in order to verify transfers, guaranteeing their validity with their assets.

3D cardano icon crypto on dark blue background

Cardano is based on extensive research and dozens of scientific papers by engineers, mathematicians, and cryptography experts in order to provide users with a top-quality ecosystem that expands on the functionalities first introduced by Ethereum.

Cryptocurrency Cashout Methods

When you want to cash out your altcoins, there are several methods for doing so and all of them are straightforward. However, the fees and various expenses of cashing out your cryptocurrencies can drastically change depending on the cashout method, service provider, type of cryptos you’re converting, and their amount.

For example, if you decide to use a crypto exchange to cash out your altcoins, there can be huge differences among exchange platforms regarding both transaction fees and the offered prices for your coins. Basically, the cashout process itself isn’t complicated, but the research you need to do before choosing the best cashout method and service provider can be complex, because you don’t want to unnecessarily pay higher fees and receive less profits if you can avoid it.

Cashing Out Altcoins at Cryptocurrency Exchanges 

The most popular method for cashing out altcoins is through crypto exchange platforms. Since there are hundreds of such platforms, you need to carefully search for the ones that will let you keep the largest amount of profits, after paying all of the platform fees. 

There are several factors you need to consider when cashing out through an exchange platform and all of them influence the final amount of cash you’ll have to pay for fees during the process.

Choose a Platform That Supports Your Crypto

You need to select an exchange platform that supports the coins you wish to exchange. For instance, if you have an account on a platform that only deals with a few of the main cryptos such as BTC, ETH, and LTC, but you actually wish to exchange your Cardano coins, then you’ll need to open a new account on a platform that supports Cardano as a traded cryptocurrency. 

Vector illustration of weighing scale with bitcoin and USD coin

Consider the Fees

Additionally, you need to pay multiple fees. First, you’ll pay a transaction fee when transferring your altcoins from your crypto wallet to the exchange platform account. Once you’ve transferred the funds to the exchange and want to convert those altcoins into a more popular asset that can be sold for fiat money like EUR, GBP, or USD, you’ll pay an additional exchange fee. After the conversion, you’ll also have to pay a fee when selling your altcoins for fiat.

In the end, you’ll have to pay another fee for transferring your fiat money to your bank account, and each time you want to withdraw some cash from the bank, you’ll also pay another bank withdrawal fee. 

So basically, there are a lot of fees that you need to take into consideration when choosing an appropriate exchange platform, which can be tricky because the platforms that support your altcoins might have higher fees than some other exchanges.

Find a Fiat-Friendly Exchange Like Coinbase or Binance

The exchange platform on which you’ll conduct the cashout needs to be a fiat-friendly exchange that offers direct conversions between cryptos and fiat currency. You basically want to sell your cryptos for real-world money and to do so you need a platform like Coinbase or Binance that enables users to sell digital currencies in a matter of minutes.

Coinbase supports over 50 cryptos, while Binance supports over 300 digital currencies. While Binance fees are some of the lowest on the market, Coinbase fees can also be quite low if you’re exchanging large amounts of coins. This means that your choice should depend on the amount of coins you’re exchanging and your general trading frequency, because these platforms offer special fee reduction features based on your 30-day trading volumes. 

There are also many other platforms that are fiat-friendly, but keep in mind not to experiment with less-known exchanges that don’t have a tight security protocol because you don’t want to risk losing your digital assets due to a possible cyber attack. Large, fiat-friendly exchanges are very secure and your funds are protected by the platform’s insurance policy in case of any unfortunate events.

3D rendering of mobile phone with crypto exchange on screen

In case you can’t find a reliable fiat-friendly exchange that supports your altcoins, you’ll have to exchange the coins for an intermediary coin elsewhere, maybe at a decentralized exchange platform, such as Sushiswap or Uniswap, that supports various currencies and then send the funds to a fiat-friendly exchange. This will incur extra exchange and transfer fees, though.

Choose a Conversion Coin (If Necessary)

In case your altcoins are some less popular, low-cap cryptos you want to cash out, you might need to choose an intermediary, a conversion coin which will be easier to sell for fiat. For example, if you want to sell a bunch of Basic Attention Tokens (BAT), which are ERC20 tokens built on the ETH blockchain, you’ll probably need to convert them first to Ethereum in order to sell them easily.

Many fiat-friendly exchanges offer much better deals when selling the most popular cryptos, than less traded one, with lower market demand. Sure, you’ll have to pay a conversion fee on the trading platform to turn your BAT to ETH, but you may still earn more money than if you sold the BAT directly. Additionally, it’s quite possible that your exchange platform doesn’t even support the direct sale of ERC20 tokens for fiat money, in which case your only option to sell the altcoins is to first convert them to ETH or BTC. A lot of popular altcoins are ERC20 tokens and it’s always better to convert them to ETH because you’ll pay lower conversion fees compared to a trade for Bitcoin.

Once you’ve converted your altcoins to an intermediary currency, you’re ready to cash out into fiat.

Find an Adequate Crypto-Fiat Trading Pair

When you’ve exchanged your altcoins for a popular large-cap crypto, you’ll easily find an adequate crypto-fiat trading pair on your exchange platform. For instance, if you’re in Australia, you should be looking for an ETH/AUD or BTC/AUD trading pair. This means that you’ll be selling your cryptos for the selected fiat currency and it’s always best if you directly sell the assets for your local currency to avoid any extra conversions.

Unfortunately, sometimes, certain trading pairs aren’t available in your region or on your trading platform, so you might be compelled to sell your altcoins for a fiat currency that’s different from your local currency.

Hand holding USD bills and bitcoin on each hand in front of laptop

Once you initiate the sale, you’ll pay a trading fee. In case you’re cashing out large amounts of money, it’s advised to do it in several smaller batches, just in case something goes wrong.

Transfer the Fiat Money to Your Bank account

The final part of your altcoin cashout process is transferring the money to your bank account, in order to make it accessible for spending and daily withdrawals with a debit card or credit card. Fiat-friendly exchanges are serious multinational companies that comply with local laws and regulations in the countries they operate. This should be enough for your local bank to accept the transaction that originates from a crypto exchange, however, given the fact that most banks still don’t deal with cryptocurrencies and distrust digital currencies as financial tools, you might have problems when transferring the money to your bank account.

Some banks don’t accept any transactions that originate from crypto exchange platforms, while other banks require additional paperwork and might freeze your assets before you provide an extensive explanation with documentation from your exchange platform.

Banking systems often fear that money that originates from cryptos might have been used for gambling or some other illegal activities, so it’s a good idea to check your bank’s policy towards crypto-related wire transfers in advance. This way, you’ll avoid any unpleasant surprises. 

Peer-To-Peer and OTC Cashouts

If you have a lot of altcoins you wish to cash out and pay less fees in the process, you might want to try over-the-counter cash out on a trusted platform such as Kraken or Bitfinex that offers special over-the-counter broker services to clients.

This type of cashout means that you choose the terms of your deal with the help of an intermediary broker service that connects you with an interested buyer. You can either list your conditions in advance and wait for an interested buyer to choose your offer, or you can look for posted offers on the platform to see whether some of them suit you.

Two businessmen in suit shaking hands on top of table

OTC broker services don’t usually deal with less known altcoins, so you’ll still have to convert your assets to an intermediary crypto first, and it’s also worth noting that such broker services are mainly meant for large amounts of coins.

Another option is to conduct a direct, peer-to-peer cashout, which is just like an OTC deal, but without a third-party platform. Instead, you directly search for an interested crypto trader on social media groups or crypto forums. You can entirely evade all fees this way, but you’re entering a deal where there’s no platform to guarantee the safety of your funds from scams and no one guarantees you that the other side will fulfill their end of the deal. This is why it’s important to do peer-to-peer cashouts only with trusted traders.

Cryptocurrency ATMs

In case you have a crypto ATM machine in your area, you can use it to cash out your altcoins. Most of these ATMs support only Bitcoin, but there are some models that also support ETH and a couple of other coins. You can check if there are any crypto ATMs in your area using Coin ATM Radar.

If you find a crypto ATM near your location, you need to convert your altcoins to the cryptocurrency supported by that ATM. Once you’ve done this, you can physically cash out your assets at a crypto ATM, but keep in mind two important factors. First, crypto ATMs have relatively low withdrawal limits, which means if you want to cash out a lot of funds you’ll have to either go to several ATMs or cash out smaller sums on a daily basis. Secondly, crypto ATMs have transaction and withdrawal fees that are quite high, so it isn’t a really good idea to cash out all of your coins at an ATM.

Even so, if you don’t have a lot of altcoins that you wish to cash out, using a crypto ATM still might be worthwhile, but check the service fees in advance, in order to decide whether it’s worth it.

Crypto Taxes

Whichever cashout method you choose, don’t forget about paying your taxes. People often forget that cryptocurrencies are also taxable just like any other income source. When you manage to make a profit from cryptos, the moment you profit, a taxable event is generated and you have to pay your due taxes according to local laws and regulations.

Physical bitcoin standing on top of tax form on table

If you’re not sure how to file taxes for your crypto income, it’s best to consult a tax professional or lawyer in order to fulfill your legal obligations on time. You definitely don’t want to be involved in tax evasion, because it’s a serious felony in all parts of the world.

A Few Final Words…

The crypto market is huge and monitoring all the various price fluctuations is impossible, but expanding your knowledge and reading informative articles about popular crypto projects and altcoins can be quite profitable if you decide to invest in a certain altcoin during its early days. In case you manage to profit from your altcoin investments and decide to cash out a part of your earnings, or all of them, these are the most popular methods for cashing out into fiat currency.