As the crypto market changes

I Sold Some Crypto - Now What?

By Carlor24 | The Block | 20 Apr 2021


With recent pullbacks from ATH on various cryptocurrencies you might find yourself in the same situation as myself, what do I do with my profits? Whether your recent exit resulted in a life-changing amount, pocket change, or somewhere in between it is important to have a plan on what's next.  For those of you who sold at a loss (don’t worry too much, we have all been there) you still need to know what to do with what money you got back.  Here are some things to consider with any realized gains or losses.

Consider the Lesson Learned

If you were anything like myself, when you first entered the volatile crypto market you were probably feeling a little nervous or confused.  First, you should congratulate yourself for learning at least the bare basics of entering and exiting the crypto market. You may have opened an account and blindly thrown some money in, or you could have been around for years and done countless hours of research.  For those of you who blindly threw some money in, I wish you good luck, but mostly I hope you take the time to learn more about what it is you may be investing in. If you have done your research, good for you! Each investment is a learning opportunity and take a moment to think about what your recent exit has taught you.  At the bare minimum, you are now a little more knowledgeable on entering and exiting the crypto market.   

Taxes

Before spending any profits please remember about taxes!  Considering the global reach of cryptocurrency it is difficult to write a broad summary of taxes owed on crypto gains.  Instead, I will urge you to take a moment to research your local tax laws and have a basic understanding of what you may owe before you spend any gains.  You don't want to end up in a position where you need to end up selling any additional assets to pay for taxes you didn’t think about. If you, unfortunately, ended up selling at a loss it is still worth your time to research your local tax laws.  Depending on your location, you may be able to use your losses to offset taxes owed on past or future profits. 

Charity

This decision is always up to you, but you should at least consider giving back to something you care about.  If you have big or small gains there are plenty of associations that would appreciate your support. I won't provide any specific details on who you should donate to or why they may need it, again it's up to you.  But you should at least take a moment to think about giving back, especially if you made life-changing amounts.

Do what you want

At the end of the day, it's your money (besides any tax obligations) and you get to do what you want with it.  You might have sold some of your bag to make that big purchase you were eyeing for a while, or you might have sold out of FUD from the volatility that the cryptomarkets are famous for.  Whatever the reason for selling was, you now have some things to consider with your next steps.  Whether you made gains or losses and they were big or small, it is important to take a moment to breathe and consider what your next steps are.  You can always do as you please, but at least be informed of what you do!

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Carlor24
Carlor24

Just an average person trying to learn as much as I can about cryptocurrencies and make some money as I go!


The Block
The Block

Just an everyday person writing about my personal crypto experience, and sharing useful knowledge that deserves to be shared.

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