How to Buy and Sell A Large Amounts of Cryptocurrencies

As the cryptocurrency market starts evolving, the ability to buy and sell large amounts of digital assets has become increasingly accessible to investors. However, executing large transactions requires careful consideration to avoid pitfalls such as price slippage, security risks and regulatory compliance issues. This guide will walk you through the essential steps for purchasing and cashing out substantial amounts of cryptocurrencies like Bitcoin safely and efficiently.

How to Purchase A Large Amount of Crypto?

Purchasing a large amount of cryptocurrencies like Bitcoin requires careful planning and a secure strategy to ensure the best price and minimize risks. Here are the steps to follow:

1. Choose an exchange;
2. Go through the verification process;
3. Use OTC desks;
4. Choose an order;
5. Break up transactions;
6. Secure your holdings;
7. Learn about the legal and tax aspects.

1. Choose a Reliable Exchange:

Opt for reputable exchanges with high liquidity; in particular, consider peer-to-peer (P2P) exchanges. They allow you to trade directly with other users. P2P trading can offer better rates and more flexibility, but it requires careful checking of counterparties. There are some tips on how to choose the platform for buying cryptocurrencies.

• Research the exchange's history and reputation in the industry. Look for reviews from other users to evaluate their experiences;
• Check the exchange’s liquidity. High liquidity ensures you can buy large amounts of cryptocurrency without significantly impacting the market price;
• Ensure the exchange uses strong security protocols such as two-factor authentication (2FA), reliable storage for funds, and encryption;
• Compare transaction, withdrawal, and deposit fees across different exchanges;
• Reliable customer support is crucial, especially for large transactions where issues can be costly. Test the exchange’s support response time and quality by sending inquiries;
• Check if the exchange requires KYC (Know Your Customer) and AML (Anti-Money Laundering) procedures;
• Make sure the exchange offers trading pairs for the cryptocurrencies you intend to purchase.

We suggest you consider the Cryptomus P2P exchange. It offers you the possibility to buy various crypto assets, such as USDT, Bitcoin and many others.

2. Verify an Account:

• Complete the necessary KYC (Know Your Customer) procedure.
• Ensure your account is set up for high-limit transactions, which might require additional verification steps.
• Provide basic personal details such as your full name, address, date of birth, and contact information.
• Upload government-issued identification documents, such as a passport, driver's license, or national ID card.

The verification process can take anywhere from a few hours to several days, depending on the thoroughness of the checks.

3. Use OTC (Over-The-Counter) Desks:

For extremely large purchases, consider OTC desks, which facilitate private transactions directly between buyers and sellers, avoiding slippage and impacting market prices. Major exchanges often have their own OTC services.

4. Market Orders vs. Limit Orders:

The choice between market and limit orders depends on your priorities.

• Market Orders: It is a procedure to buy or sell a cryptocurrency immediately at the current best available price. It’s suitable for situations where you need to execute the transaction quickly and are willing to accept the current market price.
• Limit Orders: It is a procedure to buy or sell a cryptocurrency at a specified price or better. It’s ideal for situations where you want to control the price at which the transaction is executed, even if it means waiting for the market to reach your needed price. Set a specific price to buy at, which can save costs but may take longer to fill.

5. Break Up Transactions: Instead of buying all at once, break your purchase into smaller chunks to avoid moving the market price. Use algorithmic trading tools provided by exchanges to automate this process.

6. Secure Your Holdings: Transfer your bought cryptocurrency to an online crypto wallet immediately after the purchase. For example, you can get the Cryptomus wallet and easily send, receive, and manage your assets using a user-friendly interface. Additionally, an advanced security system ensures the safety of your investments.

7. The Legal and Tax Aspects:

Consult with a financial advisor or tax professional to understand the legal and tax implications of your purchase:

• Cryptocurrency transactions are often subject to taxation. This can include capital gains tax on profits made from buying and selling, income tax on earnings from mining or staking, and potentially other taxes.
• It is advisable to consult with a tax professional or accountant who has experience with cryptocurrencies to ensure you are meeting all legal requirements and optimizing your tax position.

If you don’t know how cryptocurrency is taxed in 2024, you can read our article.

How to Cash Out A Large Amount of Crypto?

When cashing out large amounts of cryptocurrencies, it’s crucial to ensure the process is smooth, secure, and compliant with legal regulations. Follow these steps:

1. Prepare an account: Ensure your account is verified and capable of handling high-limit transactions. Understand the exchange’s withdrawal limits and processing times.
2. Consider Stablecoins for Using: Convert your cryptocurrency into stablecoins (e.g., USDT, USDC) first to lock in the value before cashing out. Stablecoins can then be cashed out with less volatility risk.
3. Use Limit Orders: Set limit orders to sell at your desired price, which can help you avoid selling at unfavorable market prices. Break your sell orders into smaller parts to minimize market impact.
4. Withdraw to Your Bank Account: Link your bank account to the exchange for direct withdrawals. Be aware of the withdrawal fees and processing times.
5. Utilize OTC Desks: For large sums, OTC desks can offer better rates and quicker processing. They provide personalized service and can handle large transactions discreetly.
6. Learn About Tax Implications: Keep detailed records of your transactions for tax-reporting purposes. Consult with a tax professional to understand your obligations and ensure compliance.
7. Comply With Security Measures: Enable two-factor authentication (2FA) and other security features on your exchange account. Be cautious of phishing attempts, and only use trusted devices and networks for transactions.

By following this guide, you can effectively buy and cash out large amounts of cryptocurrency while minimizing risks and maximizing efficiency. Always stay informed about market conditions and regulatory changes to ensure your transactions remain compliant and secure.

Thank you for reading this article. We hope you found it informative and helpful for your cryptocurrency trading beginnings.