How to Convert Bitcoins to Dollars

Choosing a Conversion Service

Compare the rates offered by different conversion services and choose the best one. Even when the average bitcoin conversion rate improves, different conversion services offer different conversion rates. For instance, suppose one service offers to convert your bitcoins at a rate of 1 to $5,000 and another offers to turn 1 bitcoin into $5,200. All other things being equal, you should go with the second service to get the most out of your bitcoins.

Convert your bitcoin using a service with low fees. Conversion services typically charge a fee for conversion. Sometimes there is a flat fee no matter how much you exchange, and sometimes the conversion service charges a percentage of the amount you exchange. Compare the fees associated with the various conversion services and select one that offers the best deal. Service fees change over time, so be sure to check the service’s terms and fee schedule.

Verify that the service you’re using is safe. There are several ways to verify that a bitcoin conversion site is safe. One is to check reputable sources for reviews that verify the integrity of a given site. Another way is to ensure that the site the service manages uses https (as opposed to the less secure http) in their URL. Finally, use a conversion service that allows two-factor identification, ensuring that only you will be able to approve bitcoin conversions.

Select a service that offers low transfer times. Some sites transfer bitcoins to your account after 5 days, but faster services could convert your bitcoins to dollars in 3 days or less.

Uploading Your Bitcoin

Sign up for an account. Signing up for an account involves providing your name, date of birth, address, email address, phone number, and other personal information. You’ll also be required to provide a bank account, an electronic payment service like PayPal, or both (depending on how you want to convert and transfer your bitcoins).

Select the strongest security options when you sign up. When you create an account on a bitcoin marketplace, you’ll have the opportunity to enable two-factor authentication (2FA), which means you will enter a password and a randomly generated code sent to your phone. You might also want to enable a multi-signature option, which requires multiple independent approvals before making a bitcoin conversion or withdrawal. Both of these security options can protect against theft and hackers, so enable them when you’re given the option.

Deposit your bitcoins in the marketplace. The specific mechanism by which you deposit your bitcoins will vary depending on how your bitcoins are currently stored. Typically, depositing your bitcoins is as easy as clicking "Deposit bitcoins" (or something similar) near the top of the marketplace's home page. If your bitcoin encryption key is printed out, you’ll be prompted to enter it. If your bitcoins are in a “wallet” (an encrypted file or code), you might be asked to upload the file. Don’t be afraid to reach out to customer support if you’re having trouble depositing your bitcoins.

Doing the Exchange

Convert your bitcoins when the exchange rate is favorable. Over time, exchange rates rise and fall. For instance, one day the exchange rate might allow you to trade 1 bitcoin for $4,900. A week later, the exchange rate might offer $5,100 for 1 bitcoin. Wait to exchange your bitcoins until the corresponding dollar value rises. There is no fixed percentage or value that defines a favorable exchange rate. Some people might feel that if the value of a bitcoin rises by $100, it is a good time to convert their currency. Others might wait until the value they’d get rises by 5 percent. Check the exchange rate regularly online or sign up for a service that updates you on the bitcoin-to-dollar exchange rate so you'll know when it improves.

Sell your bitcoins in the marketplace. Some marketplaces allow you to sell your bitcoins to another person. Others allow you to sell them directly to the marketplace, which will then resell them to interested buyers later. In either case, the specific method you use to sell your bitcoins will vary somewhat depending on the marketplace you use. Generally, you can simply click on “Sell your bitcoins” or some similar option to get the process started. The bitcoins will then be converted to dollars and transferred to the bank account you provided.

Put your bitcoins on a debit card. Some marketplaces enable you to load your bitcoins onto a debit card that automatically converts them to dollars. You might be able to get a digital debit card, which simply provides you with a string of numbers you can use for online purchases that require dollars, or you could get a regular debit card in the mail. Both types of debit cards cost money (digital debit cards typically cost about $5, while regular debit cards cost $15-$20), but they offer added convenience, especially if you rarely use cash.

Transfer your bitcoins to another digital wallet. Some bitcoin conversion services allow you to convert your bitcoins to dollars by transferring them to PayPal, Apple Pay, or similar services. If this is the way you want to convert your bitcoins to dollars, set your payout method to the digital wallet you want to use. Then, simply sell or transfer your bitcoins to the service of your choice through the marketplace menus. Converting bitcoins to dollars by transferring them to a digital wallet often has higher fees and lower limits than transferring them to your bank account. This option might, however, be preferable for people who make digital purchases regularly and don’t want the hassle of transferring their money from a bank to a digital wallet.