An Extensive Guide for Cashing Out Bitcoin and Cryptocurrencies Into Private Banks

The attitude of banks around crypto is changing slowly, but it is still a tough stance. For the first partial cash out I operated around a year ago for a client, it took me months to find a bank. They wouldn't want to even consider the case and we had to knock at each and every door. This has changed now, and banks have started to open their doors, but there is a process, a set of best practices and codes one has to follow.

What is Required to Open an Account: There are two different aspects to your onboarding—the origin of your crypto wealth and your background (residence, citizenship, and probity). These two aspects must be documented in-depth.

How to Document Your Crypto Wealth: Each new crypto millionaire has a different story. Most can be categorized within the following profiles: the miner, the early adopter, the trader, the corporate entity, the OTC buyer. The real question is how you prove your wealth is legit.

Context Around the Original Investment: Generally speaking, your first crypto purchase may not be documented. But the context around this acquisition can be. If you made your first purchase by saving from summer jobs, show a payroll. If you acquired your first bitcoins from mining, show the bills of your mining equipment from 2012 or your pool mining account. If you were given bitcoin against a service you charged, show an invoice.

Tracking Your Wealth Until Today: The blockchain is a global digital ledger! We can see the inflows, outflows, and the age behind an address. An early adopter who bought 1000 BTC in 2010 and let his bitcoin sit behind one address is legit, whether or not he has a proof of purchase. My job is to explain that to banks in a language they understand.

The Trader: These are easy cases. Traders at exchanges are easy to corroborate since their whole track record is potentially available. The strategy is to show the early trades, the most profitable ones, explain the trading strategy, and expose the current situation with ID pages of the exchanges and current balance.

The Early Adopter: Provided that he has not mixed his coin, the early adopter is not difficult either. Who cares how you bought your first 10k BTC if you bought them below $3? I focus on proof of early adoption (an old bitcointalk account can serve as proof), storytelling, and micro transactions from an old address you control.

The Miner: Not so easy to prove the wealth is legit. Most early miners never took screenshots of the blocks on bitcoin core. What helps: IT background, mining equipment receipts, wallet.dat files with block mining transactions, pool mining accounts, and describing your technical set up in context.

The Cash Out Logistics: Cashing out $1m USD a day in bitcoin or more is not so hard. But the amount should be fractioned to avoid risking your full wealth on exchange and getting slaughtered on the price. There is a major difference between trading on an exchange and trading OTC. Selling $10m on an exchange in a day can move prices. It is way better to trade OTC. The fees for cashing out through a regulated financial intermediary should be around 1-2% flat on the nominal, including execution/monitoring of trades AND onboarding in a private bank.