Crypto Investors: Are You Laundering Money?

[skazzio]

This is a new section from https://dailyiconews.com named the Crypto Skepticism of the week, written by Jason Bloomberg. I copy and paste.

As the crypto world tries to go legit, various exchanges and other feeders from the bottom to the top of the crypto food chain are implementing Know Your Customer (KYC) and Anti-Money Laundering (AML) technologies.

If you think of yourself as a criminal, then you probably realize the glory days of crypto may be past. But what if you don’t? Will you run afoul of KYC or AML?

First of all, it’s unlikely anybody cares about small transactions. After all, you can bring up to $10,000 in cash or cash equivalents across international borders or deposit such amounts into bank accounts, no questions asked (I’m referring to US regulations here, but many other countries have similar laws).

But if you’re Scarface or Walter White and have millions in cash to deposit, no on-the-level bank in the world will take your dough. And if you think selling off your stake via hundreds of small transactions is the answer? Sorry, that’s illegal as well (in the US, anyway), even though people advise just such an approach.

Such is the problem holders (or hodlers) of large amounts of crypto are facing. Whether you earned your stash via an ICO or via early bets on crypto or any other means, you now have beaucoup bucks tied up in Bitcoin or your crypto of choice.

The only way to sell off your stash is via illegal means – in other words, by becoming a money launderer yourself.

Good luck even opening a bank account, let alone converting your crypto to fiat. You’ll need to prove how you got those coins, who you got them from, and how they got them, ad infinitum.

Only said crypto is pseudonymous – or if you hold Monero, perhaps truly anonymous. Passing KYC and AML checks is now virtually impossible. In the words of President Trump, you’re f*cked.

What’s the value of a stash of hundreds or thousands of Bitcoins if you can never convert them to fiat? Bupkis, that’s what.

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[hugeblack]

I do not know what is the legal situation in your country, but if you have acquired your cryptos in a legitimate manner and managed to prove it, you must pay some taxes and then will be safe.

The problem is if you have illegally coins or been a criminal.
 In the case of crimes, there are many groups that cooperate with them.

In case your money is illegal, you have to wait until you withdraw from those currencies and do not be such a fool  [2 years in jail for illegally selling hundreds of thousands in Bitcoin].

[Fatunad]

Thats the main problem if you do own hundreds of millions equivalent of your stash. Cashing them out either on bulk or gradual basis would really raise up questions.
If your country isnt really that strict when it comes to cryptocurrencies then you might face up some slight penalties but if you are evading taxes for a heavily taxed country then
you are in trouble.In all sorts or angles we do try to look at, we wont really have any choice in the end.

[SixOfFive]

I don't understand why many people associate crypto trading with money laundering. I know many who involved in underworld activities like terrorism, drug dealing, arms dealing etc etc etc may be doing money laundering, otherwise a normal investor or you can say early crypto birds has nothing to do with money laundering. Some of the investors may use it for tax evasion, but govt is of many countries are actively working on crypto regulations.

[dothebeats]

You'll only trip the alarm for the feds and the government once you hit a questionable amount on your account, say, a couple million dollars or so. That is when they'd start questioning where the funds are coming from and whether you have the capacity to deal with such or not, otherwise they will jail you for no reason other than having those bitcoins/crypto even though you could have mined them long before others did and long before the crypto boom started. Good thing I only deal with a couple thousand, and the exchanges I'm working with aren't snooping with what I'm doing--or so I think they aren't.

[Harlot]

A lot of people think that cryptocurrencies are not leaving any kind of trace behind when they are sending/receiving coins, but the thing is the authorities are catching up on methods we haven't think off and mainly it involves around monitoring known addresses with unusual volume. Other than that they can track the physical money on where they are going. One way or another they'll notice that something isn't right that a person surprisingly become rich out of nowhere and most of them becomes careless on their part. With future regulations in hand and the industry is tightly monitored this kind of criminal activity would be less and less be active in the industry.

[magneto]

The only way to sell off your stash is via illegal means – in other words, by becoming a money launderer yourself.

I really don't know where they got the impression of this from.

You can easily sell off bitcoins completely legally on regulated platforms and exchanges, whether it is a centralised exchange in one's country, or on a p2p or OTC basis. There are no laws saying that in itself is money laundering, nor should there be. I've US friends that have does this on a regular basis. Otherwise, why are there exchanges that ask for your KYC?

The claims put forth by this post/article is clearly exaggerated and poorly researched. They make it seem like bitcoin is some illiquid underworld token, when in fact it's a complete myth and you'll find it's much more liquid and carry less spreads from a retail standpoint than even foreign currencies.

You should be only concerned if you're running an unlicensed exchange or money remittance service with bitcoin, or dealing with large sums of p2p transactions when you're the advertiser; not if you're just a normal user looking to cash out, or accumulate BTC.

[creeps]

A lot of people think that cryptocurrencies are not leaving any kind of trace behind when they are sending/receiving coins, but the thing is the authorities are catching up on methods we haven't think off and mainly it involves around monitoring known addresses with unusual volume. Other than that they can track the physical money on where they are going. One way or another they'll notice that something isn't right that a person surprisingly become rich out of nowhere and most of them becomes careless on their part. With future regulations in hand and the industry is tightly monitored this kind of criminal activity would be less and less be active in the industry.

We cannot hide from the government especially if you are transacting big money. If you do have business or high paying regular work that can give you enough financial documents then you are free to have more money through cryptocurrency but if you don't have then expect AMLA or Banks to freeze your account. You have to be careful on this one or else your hard work and your coins will be useless. Don't transact directly with your bank accounts, have more financial intermediaries before you put it in the bank.

[Netnox]

What’s the value of a stash of hundreds or thousands of Bitcoins if you can never convert them to fiat? Bupkis, that’s what.

If you own a million or two in crypto, then converting them to fiat without attracting the attention of the authorities will be a very tough task. But if you only want to convert a few grands every year, then I don't think that you need to lose your sleep over it. There are many methods available to convert crypto to fiat, and most of them are relatively safe.

[Ipwich]

Crypto investor has a chance to launder money if they will do that, it's same with fiat, they can also do money laundering but it has the same
punishment as it's against the law. I made sure all my earnings in crypto are coming from legit transaction so as an investor, I can say that I'm not doing such act.

Also, I have no problem transacting to the bank as my deposit from my local exchange is sent directly to my bank account, it's just that our government is not anti crypto so people don't view it as a dirty money that needs to be launder.

[Kemarit]

The only way to sell off your stash is via illegal means – in other words, by becoming a money launderer yourself.

LOL, I don't get it, why do you need to go to illegal means if you have work your ass off to earn that money in legal ways? So for me this is bull-shit, you can break it down into small quantity and not liquidate huge amounts and to stay away from the radar. You can do full verification, KYC/AML and then you are done. I don't know what people complicate things. Although one advantage I have is that I'm in a country wherein crypto is very much welcome and I haven't had any problems converting it to fiat. But if I do? I will still go to the legit channels to be able to cash it out and no need to go to illegal means.

[CryptoBry]

The only way to sell off your stash is via illegal means – in other words, by becoming a money launderer yourself.

LOL, I don't get it, why do you need to go to illegal means if you have work your ass off to earn that money in legal ways? So for me this is bull-shit, you can break it down into small quantity and not liquidate huge amounts and to stay away from the radar. You can do full verification, KYC/AML and then you are done. I don't know what people complicate things. Although one advantage I have is that I'm in a country wherein crypto is very much welcome and I haven't had any problems converting it to fiat. But if I do? I will still go to the legit channels to be able to cash it out and no need to go to illegal means.

That was a very myopic statement in that article actually. There are now many countries which has regulations on place for cryptocurrencies and there are now many exchanges that one can deal with legally and with convenience in converting one's crypto to cash. Here in my country, we don't have this problem and I am really happy for this. The only problem is that I don't have that much Bitcoin to convert. As to KYC, I am not afraid of that though I am also concerned with its possible risks but since we are living in reality we have no choice but to comply. Bitcoin and cryptocurrency are all here to stay whether we like or don't agree with them.

[Spaffin]

This is a new section from https://dailyiconews.com named the Crypto Skepticism of the week, written by Jason Bloomberg. I copy and paste.

As the crypto world tries to go legit, various exchanges and other feeders from the bottom to the top of the crypto food chain are implementing Know Your Customer (KYC) and Anti-Money Laundering (AML) technologies.

If you think of yourself as a criminal, then you probably realize the glory days of crypto may be past. But what if you don’t? Will you run afoul of KYC or AML?

First of all, it’s unlikely anybody cares about small transactions. After all, you can bring up to $10,000 in cash or cash equivalents across international borders or deposit such amounts into bank accounts, no questions asked (I’m referring to US regulations here, but many other countries have similar laws).

But if you’re Scarface or Walter White and have millions in cash to deposit, no on-the-level bank in the world will take your dough. And if you think selling off your stake via hundreds of small transactions is the answer? Sorry, that’s illegal as well (in the US, anyway), even though people advise just such an approach.

Such is the problem holders (or hodlers) of large amounts of crypto are facing. Whether you earned your stash via an ICO or via early bets on crypto or any other means, you now have beaucoup bucks tied up in Bitcoin or your crypto of choice.

The only way to sell off your stash is via illegal means – in other words, by becoming a money launderer yourself.

Good luck even opening a bank account, let alone converting your crypto to fiat. You’ll need to prove how you got those coins, who you got them from, and how they got them, ad infinitum.

Only said crypto is pseudonymous – or if you hold Monero, perhaps truly anonymous. Passing KYC and AML checks is now virtually impossible. In the words of President Trump, you’re f*cked.

What’s the value of a stash of hundreds or thousands of Bitcoins if you can never convert them to fiat? Bupkis, that’s what.

However, I would like to have such a problem and lavish my head on the question of how I can cash millions of dollars in cryptocurrency. I think that if you do it wisely and gradually, it will not be a problem, but a pleasant work. So who has these problems and these people consider such problems as big, I can take on these problems and indicate the address of my Bitcoin wallet.

[bitmover]

You are confused...

Investing in cryptocurrency is no crime, laundering money is.

Making money illegally and trying to hide that money using crypto is one thing. But earning money legally and investing in BTC has nothing to do with that.

If you can prove that you earned your money legally and bought btc, you have nothing to hide or be affraid.

[1Referee]

What’s the value of a stash of hundreds or thousands of Bitcoins if you can never convert them to fiat? Bupkis, that’s what.

As if signalling to the government that you own x large amount of Bitcoin will do you well in the future. 

I pay tax over the coins I trade on centralized exchanges, but won't ever pay a single penny in tax over that what I hold in my cold wallets. Bitcoin's local adoption in basically every country is on the rise, and that by hundreds of percents in a fairly short period of time. I can always convert some of my coins to fiat or buy goods with them locally.

No one has the right to claim a part of my wealth that isn't being utilized in any shape or form. It's called theft if you're forced to pay tax over that part of your wealth anyway.

[LeGaulois]

You are taxed only activity, and not on what you own of course. Imagine if we were taxed for the money we have in our bank account. I can tell you that if that happens, the banks will be in default in a few days.
I also report taxes in due form, it doesn't worth to cheat. Now there are people who do everything to not pay taxes but they complain when their country budget isn't good or they have shit roads or hospitals. I'm ok with paying taxes but I disagree to be taxed up to my anus

[sheenshane]

Cryptocurrency is made for everyone just like fiat. If the people use it in the good or in the bad, then that is their personal choice.

They shouldn't blame cryptocurrency of what people do with it. But yes, regulation is also a must for the cryptocurrency to avoid illegal deeds. In our country, cryptocurrency is not yet used for money laundering as the criminals here are not that techy(unlike pyramid scheme business). Also, cryptocurrency is not always the best option for money laundering. Having a great accountant is enough.

[imstillthebest]

Cryptocurrency is made for everyone just like fiat. If the people use it in the good or in the bad, then that is their personal choice.

They shouldn't blame cryptocurrency of what people do with it. But yes, regulation is also a must for the cryptocurrency to avoid illegal deeds. In our country, cryptocurrency is not yet used for money laundering as the criminals here are not that techy(unlike pyramid scheme business). Also, cryptocurrency is not always the best option for money laundering. Having a great accountant is enough.

cryptocurrency is not made for everyone because cryptos are not like the same as fiat  . cryptocurrency are too complex and hard to understand for a regular individual  but crypto is like a fiat because we can use it on almost anything whether its for good or bad  .  many crypto users doesnt comply to a kyc but this does not mean that we are now already a criminals or a money launderers  .

[TheKeyLongThumbI]

You are confused...

Investing in cryptocurrency is no crime, laundering money is.

Making money illegally and trying to hide that money using crypto is one thing. But earning money legally and investing in BTC has nothing to do with that.

If you can prove that you earned your money legally and bought btc, you have nothing to hide or be affraid.

Well, this is how the media plays people's minds when they target cryptocurrency. The crime is not directly on bitcoin and it is only involved or used by the real perpetrators. It is a simple logic like fiat is used to fund terrorist or organized crimes but if you asked people about whose to blame then it's the terrorist/criminals or the financer/mastermind. But it's different to the perspective of other people when the crime is on crypto because on how negative the media portrays it.

[milewilda]

You are confused...

Investing in cryptocurrency is no crime, laundering money is.

Making money illegally and trying to hide that money using crypto is one thing. But earning money legally and investing in BTC has nothing to do with that.

If you can prove that you earned your money legally and bought btc, you have nothing to hide or be affraid.

Well, this is how the media plays people's minds when they target cryptocurrency. The crime is not directly on bitcoin and it is only involved or used by the real perpetrators. It is a simple logic like fiat is used to fund terrorist or organized crimes but if you asked people about whose to blame then it's the terrorist/criminals or the financer/mastermind. But it's different to the perspective of other people when the crime is on crypto because on how negative the media portrays it.

Thats why media sucks and pure manipulative depending on what they do really like to show on public.It can really give out negativity unto something which they have been ordered to.
People doesnt really know on how to differentiate things properly when it comes to news thats why im ain surprised why do people do have these kind of mindset when it comes to crypto
and media is one of the factors that do influenced these insights.

Money laundering is different on earning crypto on a legal way.If crypto isnt still legalized nor being taxed on your country then it doesnt really have any problem at all.