License to Sell Bitcoin in Person as Oppose To Online Exchange?

[jerry0]

So I heard a few stories a while back where ppl got in trouble and arrested and even sent to jail because they were selling bitcoin to other people without a license.  Can someone explain this?  So basically if you sell bitcoin in person to ppl for cash or any types of money payment whether its bank wire or cash in bank deposit... you need a license but only if you do a lot of transactions?  But if you sell btc to a few ppl several times a year only, you don't?  Example imagine a few times you sell a few thousand worth of btc to a few friends throughout the year... say you did it 5 times and it was for like 8k total.  That you don't?



But if you were just buying/selling btc on exchanges like coinbase, gemini, binance, bittrex, bitstamp etc... you don't?  Can someone explain this to me?  I never bought/sold btc in person... only done in the online exchange but I don't seem to understand the logic behind this.  What is the difference if you are buying/selling btc in person to people or to ppl online as oppose to doing it in an exchange if you are paying taxes on it?  Is there something im missing here?  I mean the only reason someone would buy/sell btc in lbc and sites like that is because they are paying less for btc at a discount or selling btc to someone at a premium price like a few percentage above market?

[Philipma1957cellphone]

Well every country has different rules.

PLUS THE USA has 50 states with different rules. So explaining the why is not easy.

[ranochigo]

It's specific to your local regulations and the rules differs for different jurisdiction.

Basically, for some places, they have pretty strict laws about money transmitter and those exchanging fiat to crypto (or vice versa). Some states have a certain threshold for users to register themselves as a money transmitter and for them to identify any suspicious activities to combat money laundering and terrorist financing. The transaction volume needed differs from each jurisdiction so refer to your local laws.

Bitcoin exchanges are usually registered money transmitter who have a license to conduct their business activities. They are legally obliged to flag out and report any suspicious activities, as well as having a KYC system.

[Shimmiry]

~

Do you have any proofs linking to such events??

Some countries have their different laws with regards to selling and buying cryptocurreny, though it may sound like they control it, they don't. Some just prefer legal transactions in everything that has something to do with money. But if they would transact in a local place or their Bitcoins was from illegal activities or was used for anything illegal, then it would be a reason for them to get arrested.

And if you are pertaining to online exchanges, there are no rules in most countries that prohibits such actions, as most crypto are transferred with privacy and transparency.

[Fundamentals Of]

Where are you from? Countries have different domestic laws.

But I don't think any country is extremely strict and tight that they would require a license from an individual from selling a Bitcoin not for business but only for wanting to have some cash.

If that is for business, you should get a license but if it's just a mere P2P exchange which happens only a few times within a year, I don't think you will be required a license. I don't think the authorities would even notice your transaction.

[pooya87]

So I heard a few stories a while back where ppl got in trouble and arrested and even sent to jail because they were selling bitcoin to other people without a license.

the stories i have seen were mainly about the scale of their operation not just about them selling bitcoin. these people that i've seen were basically running a business and making a lot of money by trading bitcoin on a daily basis and making a lot of money while not paying any taxes.
otherwise i have not yet seen anyone getting in trouble by buying/selling bitcoin P2P a couple of times.

to know more you must consult a lawyer who is familiar with your country's law specifically related to cryptocurrencies, running a small business and money laundry.

[ArcheAdvertising]

It all depends on the country where you are, the rules vary a lot. But personally I like to buy / sell online more since it is much safer, I remember that 2 years ago I think that when BTC was reaching its historical maximum I sold 1 BTC for 15K USD and when I left the mall some guys robbed me and took my money. money obviously I'm sure it was in complicity with the person who bought my BTC, but in my country, just as there are no laws that go against the sale of BTC, there are no laws that go against the theft of BTC: D so it's kind of screwed up.

[AjithBtc]

Licensing is based on the local regulations, people getting arrested weren't for selling bitcoin. In most cases the arrests were for the reason of money laundering and making illegal transactions in large volume. This takes place mostly with the local currency exchangers, who register it as a business for money exchange and involve on money laundering.

[rexxarofmoknathal]

It's specific to your local regulations and the rules differs for different jurisdiction.

Basically, for some places, they have pretty strict laws about money transmitter and those exchanging fiat to crypto (or vice versa). Some states have a certain threshold for users to register themselves as a money transmitter and for them to identify any suspicious activities to combat money laundering and terrorist financing. The transaction volume needed differs from each jurisdiction so refer to your local laws.

Bitcoin exchanges are usually registered money transmitter who have a license to conduct their business activities. They are legally obliged to flag out and report any suspicious activities, as well as having a KYC system.

I agree, its all to do with the jurisdictions from different states. And although it doesn't make a whole lot of sense, it doesn't have to be, as since did any regulations (with them differing so drastically) made any sense? In this case, many people would go either in the states where these laws aren't that ridiculous or use exchanges. Exchanges are partially becoming the norm nowadays anyway, so this law does't really stop people from entering/gaining access to cryptocurrency - it only makes it harder but not impossible.

[cryptoaddictchie]

Licensing is based on the local regulations, people getting arrested weren't for selling bitcoin. In most cases the arrests were for the reason of money laundering and making illegal transactions in large volume.

Let say the guys OP were talking about were arrested. Based on local rule of their government probably this is their regulation. If its stipulated on their law and someone got caught that someone, has no right to resist arrest isnt it? But I doubt that there is a country that would be so strict as this not to even sell or buy bitcoin for not having license. Bitcoin is a free digital currency created for peer to peer. That country brealing the idea of Satoshi, but of course its on their people to follow or not.

[GeorgeJohn]

So I heard a few stories a while back where ppl got in trouble and arrested and even sent to jail because they were selling bitcoin to other people without a license.  Can someone explain this?  So basically if you sell bitcoin in person to ppl for cash or any types of money payment whether its bank wire or cash in bank deposit... you need a license but only if you do a lot of transactions?  But if you sell btc to a few ppl several times a year only, you don't?  Example imagine a few times you sell a few thousand worth of btc to a few friends throughout the year... say you did it 5 times and it was for like 8k total.  That you don't?



But if you were just buying/selling btc on exchanges like coinbase, gemini, binance, bittrex, bitstamp etc... you don't?  Can someone explain this to me?  I never bought/sold btc in person... only done in the online exchange but I don't seem to understand the logic behind this.  What is the difference if you are buying/selling btc in person to people or to ppl online as oppose to doing it in an exchange if you are paying taxes on it?  Is there something im missing here?  I mean the only reason someone would buy/sell btc in lbc and sites like that is because they are paying less for btc at a discount or selling btc to someone at a premium price like a few percentage above market?

I have not heard that before that people got arrested because of selling of bitcoin without license,
This issue is new to me,so if I may ask does it mean people can't sell bitcoin or buy bitcoin because their have know license to operates.
Because since I noticed what is bitcoin I have been transacting bitcoin with know obstruction or bridge to my transaction.

[arwin100]

So I heard a few stories a while back where ppl got in trouble and arrested and even sent to jail because they were selling bitcoin to other people without a license.  Can someone explain this?  So basically if you sell bitcoin in person to ppl for cash or any types of money payment whether its bank wire or cash in bank deposit... you need a license but only if you do a lot of transactions?  But if you sell btc to a few ppl several times a year only, you don't?  Example imagine a few times you sell a few thousand worth of btc to a few friends throughout the year... say you did it 5 times and it was for like 8k total.  That you don't?



But if you were just buying/selling btc on exchanges like coinbase, gemini, binance, bittrex, bitstamp etc... you don't?  Can someone explain this to me?  I never bought/sold btc in person... only done in the online exchange but I don't seem to understand the logic behind this.  What is the difference if you are buying/selling btc in person to people or to ppl online as oppose to doing it in an exchange if you are paying taxes on it?  Is there something im missing here?  I mean the only reason someone would buy/sell btc in lbc and sites like that is because they are paying less for btc at a discount or selling btc to someone at a premium price like a few percentage above market?

This happenings must be published if this is true but I don' think it really needed to have a license nor depends on the country where the said person belongs, maybe you should provid a supporting articles and place on which the incident happen so that people here can give there opinions which tackling the correct answer on the topic. But as I see it for now its just a hearsay since so far I never read a person got jailed for doing that stuff.

[Kelvinid]

I agreed to the replies above, it certainly depends on your jurisdiction and how your local authorities treated Bitcoin. I don't think that was a big concern this time so we are free to use Bitcoin and even other cryptos. And I don't think it was a threat for us either but it is all about how transactions work.

We have heard that arrest isn't only about having a license to sell but because of their illegal transactions that caught attention to the authorities. For more than a decade that Bitcoin existed, I'd never heard that issues happening everywhere, it only a case that some got caught because they used it for illegalities. Though we have that LICENSE, if we are using it illegally still it brought us into arrest.

[Slow death]

you should notice the following:

coinbase is in the USA so if in your country you don't have bitcoin laws and they only allow you to buy and sell bitcoin at your own risk, then you can buy and sell bitcoin on international exchanges like coinbase and Binance ando other, but if you want to sell bitcoin in your country to someone else from your country you will need a license as with any money sale and purchase service that is regulated by central banks. Consult the laws of your country, but in my country Is how things work

[VanityWallets2015]

I agreed to the replies above, it certainly depends on your jurisdiction and how your local authorities treated Bitcoin. I don't think that was a big concern this time so we are free to use Bitcoin and even other cryptos. And I don't think it was a threat for us either but it is all about how transactions work.

We have heard that arrest isn't only about having a license to sell but because of their illegal transactions that caught attention to the authorities. For more than a decade that Bitcoin existed, I'd never heard that issues happening everywhere, it only a case that some got caught because they used it for illegalities. Though we have that LICENSE, if we are using it illegally still it brought us into arrest.

I totally agree with you. It is certainly due to some local jurisdictions in their region.
And definitely, if this is not an illegal transactions, the authority won't make a big fuss about it.
Research is important if we are allowed to make transactions anywhere or we need some kind of license.

[kamadazje]

I am not so sure if there are something like this that happened but if in case there is an arrest that happened. I am sure that they have something fishy
in their actions or selling bitcoin in their country is prohibited.

Person to person is not a problem, though exchanges opposes it as it is a little bit risky for sellers and buyers as the chances that they will likely to get
scammed is pretty high. But as long as you know what you are doing then there is no problem buying bitcoin to people aside from exchanges.

[Findingnemo]

If you are going to do this is on a regular basis then the license may be required but for someone who does it completely person has no reason to report it to the government so they never going to find are you selling bitcoins or not. Maybe the person were arrested for other reasons like for money laundering or dealt with the scammers/criminals.

[roadrunnerjaiv2025]

That depends on which country or state you are making transactions from. Since Bitcoin (or cryptocurrency) is a type of currency, selling or buying it is considered a form of money transmission, and money transmission is a heavily regulated process in any country. Meaning, there are laws governing it, and any transaction that slips through the regulations is deemed unlawful. It makes sense why some countries would do this because bitcoin can be exchanged for fiat money. If they don't regulate bitcoin like they do fiat money, crooks will take advantage of bitcoin transactions to smuggle fiat money out of their country's financial system. But like I said, that depends on which country you are in. I suggest you read up on money transmission laws in your country or state before you start selling or buying bitcoin just to be safe.  

[Yamifoud]

Having a license in regards to Bitcoin selling/buying, it will just lead us to lose our privacy. We've been tracked at that time and can't be anonymous anymore.
Have we liked it? Not, for sure.

I was not looking that side to be in favor of us and to save from the said arrest. I think license will be only required when we are running Bitcoin ATM's, local crypto exchanger but having it in person to person transactions (like we did most of the time), I don't think there is a need to have this.

One thing that bothers you @OP is that you are badly thinking about the worst-case scenario to happen. We can't be arrested because we use bitcoin for a good reason but for sure we got arrested when it is against the law or some sort of illegal activities.

[yazher]

Like everyone sais here, every country has different regulations regarding that matter but as for our country we don't have some problem for now. We are free to sold our BTC to people most people called it P2P transactions but off course, you need to be careful when doing such transactions or else you gonna end up like these guys here: https://github.com/jlopp/physical-bitcoin-attacks/blob/master/README.md