How to cash out crypto from Metamask? This DeFi crypto wallet can’t get you to cash directly when needed. This article shows 3 smart options.
Decentralized finance is a very young technology that came to birth on the Ethereum blockchain. Since 2019, billions of dollars worth of ETH has been deposited on DeFi platforms like Uniswap, AAVE, or Compound to name a few.
In general, if you want to join this very profitable investing business you will need a decentralized wallet like Metamask. Additionally, you can use the wallet to connect to the platform and start trading without the need to sign up for a cryptocurrency exchange. Also, this way of investing does not require performing a Know-your-Customer checks procedure where you keep in control of the private keys.
Although trading on a DEX(decentralized exchange) can be very profitable cashing out profits to traditional money isn’t a built-in feature on Metamask. Moreover, it will never be because this is the way the Ethereum blockchain works.
In other words, to cash out crypto from Metamask you will need to leave the Ethereum blockchain and send the funds elsewhere to trade for money. This article will give you 3 smart ways to cash out crypto for money when using Metamask as a crypto wallet.
How to Cash out Any Token from Metamask
Again, when using Metamask as a crypto wallet you don’t have the option to transfer your funds to your bank account using SEPA or SWIFT. Instead, the best way is to convert your token to ETH and withdraw the ETH to an external crypto platform. Below are the most common steps to do so:
- Convert/swap your crypto to ETH
- Create a free account on Binance
- Withdraw ETH to your Binance account(ETH wallet)
- Trade ETH for money(USD, EUR or any other)
- Transfer the funds to your bank account
In this example, I used Binance because it’s the most popular exchange on a global scale. However, if you are from the USA I would strongly recommend withdrawing your ETH to Coinbase as this is the legal alternative to Binance(which is currently blocking US residents).
Later on in this article, I’ll deep dive into some smart options for cashing out crypto from Metamask but first some interesting features of this Metamask crypto wallet.
What is Metamask crypto wallet?
For people who are new to decentralized finance(DeFi) and using a crypto wallet like Metamask, first an introduction to this crypto wallet. Notably, Metamask started as an extension in the Chrome browser that you can easily install(and still is). Recently, at the end of 2020, the developers added downloadable versions for mobile phones as well(Android and IOS).
Basically, Metamask is a wallet that is primarily available on the Ethereum blockchain. In particular, it allows users to store and manage account keys, broadcast transactions and send and receive Ethereum-based cryptocurrencies and tokens and doesn’t differ much from a regular crypto wallet.
However, because Metamask is only Ethereum-compatible it also allows you to connect to decentralized applications on the Ethereum blockchain. A good example of this is DEX’es or decentralized trading platforms like Uniswap.
Why is Metamask so good?
One of the most important features of Metamask is that it acts as a browser on the Ethereum blockchain. Moreover, you can browse or interact fully on the Ethereum chain without the need to download the entire blockchain.
As a result, Metamask is more than just a wallet and that’s why many crypto users find it a good option to use when interacting with all the different dAPPs available.
How does convert coins on Metamask work?
MetaMask offers the ability to swap one crypto token with another—seamlessly. Indeed, converting or swapping crypto is a new feature on Metamask that allows you to instantly swap crypto(ETH) for any other token without connecting to a DEX.
In particular, MetaMask is using multiple DEXs (decentralized exchanges) and AMMs (automated market makers) to find the best price for a particular token. The company also says its calculations of gas prices (gas fees are fees for transactions on the Ethereum network. For instance, it dynamically changes as a result of multiple factors, including network congestion) will result in reduced gas costs. Finally, MetaMask employs slippage protection, by spreading orders across multiple exchanges to reduce slippage costs.
Using the built-in Swap feature of Metamask
To swap a token using the ‘Swaps feature’ on MetaMask, you need to follow these simple steps:
- Open the Metamask Extension or Mobile app
- Click the ‘Swap‘ button
- Select the tokens you want to swap and click ‘Get quotes‘
- Compare all available quotes and select the best one
- Click swap and finalize the transaction
3 Smart Ways to Cash Out Crypto From Metamask
Now that you know more about the features of the Metamask crypto wallet a new ‘problem’ occurs for crypto investors that are in good profit. As Metamask only works on the Ethereum blockchain, there is no direct way to cash out crypto for money.
At the beginning of this article, I showed you the most common way to do this, however in my opinion there are ‘smarter‘ ways to do this. Remember that these options are only smart if you really want to cash out crypto for fiat currency(USD, EUR, or any other).
#1 – Crypto backed loan
The first option to cash out crypto from Metamask is by using a crypto-backed loan. Especially, if you have made good profits in some small-cap token like 1INCH then the first option would be to convert this to ETH. Indeed, this is no different from the first step described in the head of this article. However, instead of withdrawing to a crypto exchange like Binance, you withdraw your ETH to a crypto lending platform like Nexo.
Additionally, the idea is not to sell your crypto for money, but to lend money by using your ETH as collateral. This way, you keep in the possession of a rising asset(ETH) in terms of price which can be very beneficial in the long term.
Of course, there are some important issues to mention when using a crypto lending platform like Nexo. The first thing is called loan-to-value(LTV) meaning that you can borrow only 50% of the total value you deposited.
For instance, if you have made a good profit worth of $5000 in ETH by using Metamask then you can only borrow $2500 in cash for it on the Nexo platform. Secondly, because you are getting a loan you have to pay 6.8% APY interest over it which is charged on a daily basis.
Despite, these two properties of using a credit line platform the advantages of Nexo are even better:
- Earn 8% APY on ETH deposits
- You get a loan instantly / no credit line checks
- Get a loan up to $2000000 a day
- Built-in exchange(swap ETH for stablecoins)
- Earn 12 % APY on stablecoins
- Getting a loan doesn’t have a tax event(!)
>>Go to the Nexo platform here
#2 – Use a Crypto Debit card for Spending
Another option for cashing out crypto from Metamask is by using a crypto debit card. In this case, you made a profit on some tokens by using Metamask. As a result, you just want to spend the profits in real life instead of funding a bank account.
Why not use a debit card for this? Nowadays you can pay in any store whether online or offline where VISA is supported on a global scale. Besides, if you live in a part of the world where getting a bank account can be hard for ordinary people then the crypto debit card is an acceptable alternative. A good example of a platform that works with crypto debit cards is Bitpanda.
In short, Bitpanda is a popular trading platform that besides trading in cryptos also offers to trade in popular tech stocks like Amazon(AMZN) and Tesla(TSLA). In addition, users of the platform can choose to send a debit card to their home address. Using a debit card for spending has the following benefits:
- Pay in any store(globally) that supports VISA
- No need for a bank account
- You are actually spending your crypto
#3 – Use a Crypto Exchange
As explained earlier in this article, you can also use a crypto exchange to cash out crypto from Metamask. Moreover, this is the most popular and common option and will suit you perfectly if you are a starter in this new crypto environment.
One of the big cons of using a crypto exchange instead of another platform is that you can be the owner of cash in 24 / 48 hours on your bank account. Also, when using a cryptocurrency exchange like Binance or Coinbase you can be sure that they can deliver as promised because of the high liquidity available in their order books.
All in all, centralized exchanges offer beginner investors a familiar, friendly way of trading and investing in cryptocurrencies. As opposed to using crypto wallets and peer-to-peer transactions, which can be complex, users of centralized exchanges can log into their accounts. In addition, view their account balances. In other words, the interface for web and mobile apps is excellent and will suit you best when using it.
Wrapping it Up
Suppose, you have gained beneficial or maybe even 100X in some unknown token by using Metamask on the Ethereum blockchain. What is the best way to cash out crypto for money? In short, the smart options explained in this article should give you a better idea of cashing out crypto from Metamask. Here is the summary:
- Crypto backed loan
- Using a Crypto debit card
- Use a crypto exchange for money transfer
The following articles might also be a good read for you:
- Best Way to find Upcoming NFT Projects
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- 7 Best Methods to Promote NFTs(For Free)
- 5 Steps to Start A Successful NFT Project
- Is Crypto Lending a Good Idea? Here 4 Reasons Why
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