In fact, a lot of investors prefer to hold onto their assets for the long term, especially if they believe the price will go higher in the future.
So, how do you take profits without selling?
There are a few smart ways to unlock value from your crypto without giving up ownership. From borrowing against your holdings to earning passive income, this guide will show you how it works, what tools to use, and what to watch out for along the way.
Want to know how meme coin holders manage risk? See why some meme coins can’t be sold before you get trapped.
Why Some People Avoid Selling Crypto
Selling your crypto might seem like the easiest way to take profits, but it’s not always the best move. Many people avoid selling for a few key reasons:
- Taxes, in a lot of countries, selling triggers capital gains tax
- Long-term goals, some holders believe their crypto will be worth more later
- Want to stay invested, they don’t want to lose their position in the market
- Looking for better options, like using their crypto as collateral instead
Holding onto your crypto while still using its value is a smart way to stay in the game and protect future upside.
Planning long term? Understand how crypto is taxed so you don’t get surprised later.
Use Crypto as Collateral for a Loan
One of the most popular ways to take profits without selling is by using your crypto as collateral to borrow money.
Here’s how it works:
- You lock up your crypto on a platform like Aave, Compound, Nexo, or Binance Loans
- You borrow stablecoins (like USDC or USDT) or sometimes even fiat
- You still own your crypto, and it gets unlocked once the loan is paid back
This gives you access to cash or stablecoins without selling your coins. But be careful — if the price of your crypto drops too much, you could get liquidated. Always borrow responsibly and understand the platform’s rules.
Spend Using Crypto-Backed Debit Cards
Another way to use your crypto without fully selling it is by spending it through a crypto-backed debit card. Platforms like Crypto.com, Binance, and Wirex offer cards that let you pay for everyday items using your crypto balance.
Here’s how it works:
- You load your card from your crypto wallet
- When you make a purchase, only the amount you spend is converted
- You keep the rest of your crypto untouched
It’s a flexible way to use your gains for real-world spending while still holding most of your portfolio. Just make sure to check fees and reward options, since they can vary by provider.
Earn Passive Income Instead
If you don’t want to sell but still want to benefit from your holdings, you can put your crypto to work by earning passive income. This means using your assets in a way that generates rewards over time.
Popular methods include:
- Staking coins like ETH, SOL, or MATIC
- Lending your crypto on platforms like Aave, Compound, or Lido
- Yield farming in DeFi protocols to earn interest or token rewards
Instead of selling your main assets, you can claim the rewards and use or convert those. Keep in mind that yields can change, and some platforms come with risk, so always do your research before jumping in.
Not sure where to start? These are the best meme coin trading strategies to mix passive and active gains
Use a Crypto Line of Credit (CeFi or DeFi)
A crypto line of credit works a lot like a loan, but with more flexibility. Instead of borrowing a set amount all at once, you can draw funds when you need them and pay them back over time.
Here’s how it works:
- You deposit your crypto on a platform like Nexo or a DeFi protocol
- The platform gives you access to a credit line based on your crypto balance
- You can borrow stablecoins or fiat and repay when it suits you
This is useful if you want to take profits slowly or only borrow as needed. Just keep an eye on your collateral level. If the value of your crypto drops too much, your position could be at risk.
Tax Benefits of Not Selling
One big reason people avoid selling their crypto is to reduce or delay taxes. In many countries, selling is seen as a taxable event, meaning you may owe capital gains tax if your crypto has gone up in value.
But if you borrow against your crypto or earn rewards through staking, it often doesn’t count as selling. That means:
- You can access cash without triggering taxes right away
- You may qualify for lower tax rates later if you hold long enough
- You stay fully invested while still using the value of your crypto
Of course, tax laws vary by country, so it’s always smart to check with a tax advisor. But for many holders, not selling can be a big advantage when it comes to managing taxes.
Things to Watch Out For
While these strategies can help you take profits without selling, they’re not risk-free. It’s important to know what could go wrong before locking up your crypto or borrowing against it.
Here are a few things to watch for:
Liquidation risk – if the value of your crypto drops too much, your loan could be closed automatically
Interest fees – borrowing isn’t free, and rates can change depending on the platform
Platform risk – some services have shut down, been hacked, or changed their term
Over-leveraging – borrowing too much can backfire fast if the market dips
Always read the fine print, understand the risks, and only use trusted platforms with good reputations.
Final Thoughts
You don’t always have to sell your crypto to take profits. Whether you borrow against it, earn passive income, or spend it through a card, there are ways to unlock value while still holding your coins.
These strategies work best when you manage risk and stay informed. Crypto moves fast, but with the right tools and a solid plan, you can use your gains without giving up your position in the market.
