Cashing Out Thousands of Bitcoin

[bayu7adi]

I believe every country has a reasonable threshold for a balanced account to avoid arousing suspicion from local financial regulatory bodies. Banks may inquire about your occupation and estimate your income, but if the assets disclosed exceed $10 million, I believe it would draw the attention of the IRS.

Gradual withdrawals are a simpler way to steer clear of scrutiny. If you're earning your money legitimately, I think you should be able to explain it well, and there shouldn't be any grounds for legal repercussions during an audit.

[1714493903]

1714493903

[Crypto Bull]

I believe every country has a reasonable threshold for a balanced account to avoid arousing suspicion from local financial regulatory bodies. Banks may inquire about your occupation and estimate your income, but if the assets disclosed exceed $10 million, I believe it would draw the attention of the IRS.

Gradual withdrawals are a simpler way to steer clear of scrutiny. If you're earning your money legitimately, I think you should be able to explain it well, and there shouldn't be any grounds for legal repercussions during an audit.

I don't care about the IRS knowing about my transaction. I can pay my taxes at the end of the year. I just want my transaction to go through and ultimately settle into my brokerage account(s).

[sokani]

How would you go about cashing out very large sums of Bitcoin, or other cryptocurrency?

If I had $130,000,000 worth of assets seating in my wallet, I would not cash out all of it to fiat to avoid attracting unnecessary attention to myself. I would leave most of it in crypto and only convert 1% of it to fiat.

Coinbase and Gemini your only convenient options? Will they be able to cash out such a large sum, and send the proceeds to your financial institutions without issues?  

I think there's a limit to the amount of money your account can receive from exchange but this may vary in different countries. In Nigeria, the maximum amount you can receive in a day on Binance exchange is N18 Million and you must be an active trader.

FDIC insurance only covers up to 250k per bank account. So, you would need more than four hundred accounts in order to cover all 100 million dollars. Is there a better way? Can you just send all 100 million directly to your Vanguard brokerage account? How do the ultra-wealthy do it?

You've said it yourself that according to FDIC insurance, an account can only hold $250k, so what do you think will happen when someone who's account balance is $3k, sudden receives $250k in four hundred different accounts? Your account would be frozen and you would be called upon by the authorites to explain the source of your wealth.

[philipma1957]

I believe every country has a reasonable threshold for a balanced account to avoid arousing suspicion from local financial regulatory bodies. Banks may inquire about your occupation and estimate your income, but if the assets disclosed exceed $10 million, I believe it would draw the attention of the IRS.

Gradual withdrawals are a simpler way to steer clear of scrutiny. If you're earning your money legitimately, I think you should be able to explain it well, and there shouldn't be any grounds for legal repercussions during an audit.

If you have 5000 coins from 2011 you may have spent only 5000 to get them.

If you held them till now and want safer investments you almost certainly can prove how you got them back in 2011.

They are worth 130 million. You have zero need to hide your wealth from the government assuming it is a quasi legit country..

Mixing and hiding shit at these levels do not make sense.

Just keep cashing at a steady pace and buy bonds and some stocks. Also you need legal advice at this kind level.

[Don Pedro Dinero]

You were fortunate to purchase five thousand Bitcoin, when it was only pennies a coin, and it's now worth a whopping $130,000,000. This is now sitting in cold storage in your digital wallet, and you want to cash out 100 million usd.

I would never let that happen to me, nor do I think anyone else would. Nobody has $5,000 and waits until it becomes $130,000,000 without cashing out anything first. The normal thing is to cash out little by little as the ball gets bigger and bigger. But even if you had partially withdrawn along the way and ended up with a huge sum anyway, or even in the scenario you pose, you are foolish if you plan to do it on your own or with advice from a forum.

<...> you need legal advice at this kind level.

[wxa7115]

How would you go about cashing out very large sums of Bitcoin, or other cryptocurrency?

A hypothetical example:

You were fortunate to purchase five thousand Bitcoin, when it was only pennies a coin, and it's now worth a whopping $130,000,000. This is now sitting in cold storage in your digital wallet, and you want to cash out 100 million usd.

1) Are Coinbase and Gemini your only convenient options? Will they be able to cash out such a large sum, and send the proceeds to your financial institutions without issues?  

2) FDIC insurance only covers up to 250k per bank account. So, you would need more than four hundred accounts in order to cover all 100 million dollars. Is there a better way? Can you just send all 100 million directly to your Vanguard brokerage account? How do the ultra-wealthy do it??

3) What would happen if you suddenly sent a hundred million dollars to several banks/financial institutions? Would the IRS be immediately notified? Would your accounts get frozen? How do you avoid this?


No snarky answers, please. The above are only hypothetical examples. I don't own 5000 Bitcoin. Not even remotely close.

I think this is the wrong way to go about this, this kind of move is huge no matter where you are, so you will have to talk to expert lawyers to create a strategy that allows you to cash out that money without issues and to pay the smallest tax possible.

As there is now way that you can withdraw that amount of money without raising red flags regardless of the country in which you are living, also it does not make too much sense to sell all of those coins and then think about what to do with that money when it is already invested in bitcoin, so at most I would try to withdraw 10% of that amount with the precautions I mention above in a process that most likely will take months, as going from earning a small amount of money to a fortune will without a doubt bring a lot of attention to yourself, and you will have to be ready to explain the source of those funds over and over again.

[Oasisman]

I believe every country has a reasonable threshold for a balanced account to avoid arousing suspicion from local financial regulatory bodies. Banks may inquire about your occupation and estimate your income, but if the assets disclosed exceed $10 million, I believe it would draw the attention of the IRS.

Gradual withdrawals are a simpler way to steer clear of scrutiny. If you're earning your money legitimately, I think you should be able to explain it well, and there shouldn't be any grounds for legal repercussions during an audit.

I don't care about the IRS knowing about my transaction. I can pay my taxes at the end of the year. I just want my transaction to go through and ultimately settle into my brokerage account(s).

Well, in that case one of the best option you can do is to get it OTCd in any banks that accepts bitcoin or any crypto exchange if you want to cash it out all at once, just to make sure your account is gonna be safe from being froze.
There's almost no way you can have it all cashed out using online transactions, or using the most basic trading in any exchange or any bank transfer for that huge amount of money.
IRS plus some transaction fees, I'm not sure how much is gonna be left after all those are taken out. So, you're not getting the whole $100m.

[SmartGold01]

As a bitcoin holder or a trader knowing too well that you bank can't accommodate such huge amount of money what you would use is a company account or you can trade it gradually to cash out the amount you mentioned, the only is that it could cost you time to finally trade all out to fiat but sometimes company account and business account can get all amount accommodated judging from my country the way our banking system are being operated. For personal account there are some sets of restrictions that has been set either to withdraw only #500k per week and max deposit of $5m

The CBN said in compelling circumstances, not exceeding once a month, where cash withdrawals above the prescribed limits would be required for legitimate purposes, such cash withdrawals shall not exceed N5,000,000.00 and N10,000,000.00 for individuals and corporate organisations, respectively, and shall be subject to the referenced processing fees in (1) above, in addition to enhanced due diligence and further information requirements.

So for some countries it surely depends on their account restrictions and limitations otherwise, cashing out $200k per day or per week would be ideal to withdraw out a total sum of $130m or maybe you can get a company account to withdraw it out.

[kryptqnick]

Why would anyone want to cash out that much money? What kind of purpose can that be used for?
I can't really imagine a situation like that, but I think that such a huge amount of money calls for an OTC deal. Just after googling a bit, I can see that some major companies, including Coinbase, have OTC desks for big cashouts, so I would probably contact one of those, learn how these things work and do it like that. This way I wouldn't negatively impact the market, I wouldn't have to wait forever for my deal to be done, and I'd establish useful professional connections, I guess.
Needless to say, I'm sure I'd have to pay a sell tax on that money, which I should, considering how much I own in that hypothetical situation.

[LoyceV]

That amount might be questionable to any exchanges if you're just a new user. So the best thing to do is to withdraw a couple amount gradually and use Bitcoin mixer to make sure that your address is clean and not connected to any suspicious address.

That's the dumbest thing you can do! If you have old Bitcoins you can easily prove your wealth came from capital gains. Depending on the tax system you either pay your taxes when you sell them, or you should have paid annually (like where I live). And that's the reason to report your holdings to taxes: if there's a paper trail, you can cash them out without worrying about the IRS. All you have to do is pay, and keep the rest.

[Dunamisx]

You were fortunate to purchase five thousand Bitcoin, when it was only pennies a coin, and it's now worth a whopping $130,000,000. This is now sitting in cold storage in your digital wallet, and you want to cash out 100 million usd.

It's very simple to do, just know that you don't have to necessarily move the whole money at once, you can do it instalmentally and also if you're exchanging them with an exchange, then try to avoid the same bulkiness of sending or withdrawal at ones, you can also make use of a decentralized no kyc exchange and make use of the p2p network, there's whale alert system that also notifies of any giant move of currency, so in every decision you will be taking, don't just make it suspicious by making huge transaction that could be alarming.

[Fivestar4everMVP]

5000 bitcoins, or $100 million dollars is sure alot of money, but I personally do not see any reason why such a huge amount of money must be withdrawn ones, to avoid problems, I personally would advice the any individual with such amount of money to withdraw, dived the withdrawal into several thousands of dollars, the person could withdraw $50,000 every week until the entire $100 million dollars is completely withdrawn..

The above approach will also help make sure that the sell off does not have much negatively impact on the market in general, but even if it does, this is still not as important as withdrawing the money to your private bank account, weekly withdrawal of $50,000 will ensure that you do not end up in some problems with regulatory bodies.

[Kakmakr]

I would not even consider converting that amount of coins in one transaction. I would open several accounts at different Crypto currency exchanges and then transfer some coins to all of them. I will then convert smaller amounts and deposit it into several different Bank accounts that are linked to those exchanges.

The Banks already flag transactions at a much lower amount (I think something like $10 000) .. so the Tax authorities will know, even if you do this with small amounts.  

[LoyceV]

The Banks already flag transactions at a much lower amount (I think something like $10 000) .. so the Tax authorities will know, even if you do this with small amounts.  

I'll remind people again: you want the tax man to know about it, so you can pay your taxes and enjoy your money. What are you going to do with $100M black money? You're much better off with $50M in money that you can spend to buy items legally.

[Marvell1]

How would you go about cashing out very large sums of Bitcoin, or other cryptocurrency?

A hypothetical example:

You were fortunate to purchase five thousand Bitcoin, when it was only pennies a coin, and it's now worth a whopping $130,000,000. This is now sitting in cold storage in your digital wallet, and you want to cash out 100 million usd.

1) Are Coinbase and Gemini your only convenient options? Will they be able to cash out such a large sum, and send the proceeds to your financial institutions without issues?  

2) FDIC insurance only covers up to 250k per bank account. So, you would need more than four hundred accounts in order to cover all 100 million dollars. Is there a better way? Can you just send all 100 million directly to your Vanguard brokerage account? How do the ultra-wealthy do it??

3) What would happen if you suddenly sent a hundred million dollars to several banks/financial institutions? Would the IRS be immediately notified? Would your accounts get frozen? How do you avoid this?


No snarky answers, please. The above are only hypothetical examples. I don't own 5000 Bitcoin. Not even remotely close.

To be honest, none of us has ever owned or currently owns such a large amount of money, so answering this question is really not easy. I also agree with everyone's solutions such as splitting the withdrawal amount even though it will take a lot of time, or using a company account...But it's all just our thoughts and none of us have any experience with it. Therefore, it is difficult to know the effectiveness of these solutions.

In my opinion, we should focus on accumulating bitcoins now, and if we have the opportunity to own a large amount of bitcoins in the future, we will definitely have a solution for that.

[Fight2W]

How would you go about cashing out very large sums of Bitcoin, or other cryptocurrency?

A hypothetical example:

You were fortunate to purchase five thousand Bitcoin, when it was only pennies a coin, and it's now worth a whopping $130,000,000. This is now sitting in cold storage in your digital wallet, and you want to cash out 100 million usd.

1) Are Coinbase and Gemini your only convenient options? Will they be able to cash out such a large sum, and send the proceeds to your financial institutions without issues?  

2) FDIC insurance only covers up to 250k per bank account. So, you would need more than four hundred accounts in order to cover all 100 million dollars. Is there a better way? Can you just send all 100 million directly to your Vanguard brokerage account? How do the ultra-wealthy do it??

3) What would happen if you suddenly sent a hundred million dollars to several banks/financial institutions? Would the IRS be immediately notified? Would your accounts get frozen? How do you avoid this?


No snarky answers, please. The above are only hypothetical examples. I don't own 5000 Bitcoin. Not even remotely close.

That is actually a very good question. A couple of years ago, I'd say the exchange won't be feasible at all, considering the fact liquidity was most likely insufficient for something like this. Today tho, my best guess would be trying to establish some sort of connection with a more powerful bank, and get a more favorable deal based on mutual consideration. Who knows, maybe someone would go for it hahahah

[gunhell16]

In actuality, such a huge sum cannot be casually released. Perhaps using several exchanges will be required if I have such substantial assets; in that case, I would just have a daily release cap. To be completely honest, if I spend that much, it will probably take a few months.

Because there is a restriction on the withdrawal in the local wallet where I transfer money from cryptocurrencies in our nation, our local wallet may naturally ask me here since I withdraw over P2P every day.

[KiaKia]

You don't want SWAT team breaking down your door on you while you have some good looking bae with you enjoying some movies together, don't withdraw all your money from Bitcoin into your bank account, the next thing that will come to mind is you are into fraud and you will be taken in for questioning.

Even whales don't do this, they only move money into their bank account when they need it, and they will not move millions that could raise some suspicion, I won't dare move more than $20,000 into my bank account, that's if I ever need that much money instantly, anything more than this will raise some suspicion over my account and I could be on watch.

If you have something you want to build that will cost a lot of money, intentionally slow it down, build it with time, and do not prove you have all the money in the world by doing it instantly, you are endangering your safety too, off the bank record, they have your home address and they know how much you have in the bank.

[Lucius]

~snip~
No snarky answers, please. The above are only hypothetical examples. I don't own 5000 Bitcoin. Not even remotely close.

Then why the question at all? Every country has its own laws, so if you acquired that Bitcoin in a legal way, then you don't have to worry about anything, including taxes, banks or exchange offices.

In case I have such a large amount of BTC, I would never sell it in a way to cause a lot of attention, but I would do it in a way to try to negotiate the sale with to some of the CEXs that I would then visit in person and sell through their OTC. Before that, I would open bank accounts in some reputable banks in Switzerland, where I would also rent safes and store some of the cash in them.

In fact, there are countless possibilities and it is true that it is not a problem to sell that much BTC even if you don't want to go directly through CEX, but for most it will never be a "problem" because they will not even have 10 BTC, let alone the thousands that we are talking about hypothetically here.

Besides, why sell everything when there are so many ways to use Bitcoin as a currency around the world - booking hotels, buying plane tickets, paying in restaurants and on thousands of online sites that sell various goods and services.

[Crypto Bull]

You've said it yourself that according to FDIC insurance, an account can only hold $250k, so what do you think will happen when someone who's account balance is $3k, sudden receives $250k in four hundred different accounts? Your account would be frozen and you would be called upon by the authorites to explain the source of your wealth.

And, once I showed them that I purchased Bitcoin, or other cryptocurrency, for X amount of dollars on X date(s), would that be the end of it? Would the account be unfrozen and my transactions immediately allowed to go through?