Although many crypto investors believe that hodling is the best way to make gains, there are times where selling your bitcoins for cash makes sense. The crypto market is unlike the stock market where those who make smart investments can expect their money to increase over time. Businesses with strong fundamentals often succeed in the stock market regardless of short-term highs and lows. Bitcoin (BTC) is the market leader of all cryptos, and its developers work around the clock to boost the digital currency’s functionality. However, it’s mainly hype that eventually causes BTC swings. Knowing the right time to cash out your BTC can potentially save you from huge losses resulting from market crashes.

How to Determine When to Cash Out Your BTC

Considering the following factors can help you determine when to cash out your bitcoins.

1. Substantial Gains

Selling your bitcoin for cash is advisable if you have made a significant profit from your crypto investment. For example, when the asset’s price doubles from the initial purchase price, that is a huge opportunity to sell your BTC. Cryptocurrencies may show an upward trend for a reasonable length of time depending on market conditions, but traders should always consider withdrawing the gains accrued from their investments. 

1. Urgent Need for Money

You should think about selling your crypto for cash instantly if you need money. Thanks to physical bitcoin exchanges like Nakitcoins, finding a nearby shop to cash out BTC is easy in Turkey. One advantage of on-site bitcoins shops is that you don’t need to create and verify your account on the exchange before you can turn your crypto into cash. However, crypto enthusiasts who prefer online platforms can opt for regulated exchanges such as Binance and Coinbase to withdraw their BTC.

1. Fund Reallocation

Cashing out and reallocating your capital is a good idea. Some bitcoin traders who experience massive returns or losses on certain assets choose to sell and reinvest in other projects. Directing your funds to other projects can help you recover from a loss or seize opportunities in emerging markets. However, you should remember that no investment comes with a guarantee. Reallocating can help diversify your portfolio, but you have to make sure to invest in sound projects. Otherwise, feel free to keep your holdings if your existing assets are enough.

1. Negative News

The best time to withdraw your funds is when a string of negative publications relating to BTC start to reduce the crypto’s value. Bad news concerning the crypto market can spread like wildfire and impact your bitcoin investment. Although a spat of negative stories also happens in the stock market, bitcoin is more susceptible to media effects. It’s not surprising that bitcoin price sometimes drops by double figures due to negative headlines. Staying up-to-date with industry trends is crucial if you want to gauge where a project is moving to. For example, many crypto investors who cashed out their TerraLuna before it crashed due to negative news saved a lot of money. 

Although perfectly timing your bitcoin cash out is not always possible, developing the habit of following current developments can be beneficial to traders.