How to Convert Crypto to Fiat Safely, Legally, and Easily
In the world of cryptocurrency, there’s no such thing as a free lunch. So it’s no surprise that converting crypto to fiat — real-world money — is never immediate or free.
And if you’re not careful, you may find yourself running afoul of your local laws. Fortunately, there are a number of ways to convert crypto to fiat in a way that’s both safe and legal. But which method you choose depends on how much time and money you’re willing to put into it.
Why You Need to Be Careful
The most important thing to realize about converting crypto to fiat is that every country has different rules about how this process can be accomplished. In the United States, for example, the IRS treats cryptocurrencies like bitcoin as property rather than currency. Therefore, any exchange of one cryptocurrency for another, or for fiat currency, is considered a taxable event by the IRS, meaning that it has tax implications.
In other countries, such as China and South Korea, cryptocurrencies are banned outright. In countries like Russia and Venezuela, where fiat currencies (the ruble and the bolivar) have collapsed due to hyperinflation, cryptocurrencies represent one of the only ways people can make any money at all. So these countries have taken a more lenient