Hello, I have seen that multiple cryptocurrency exchange services have started to offer users personal dedicated IBAN. To name a few Spectrocoin, Swissborg, and Nexo. What are the benefits of such service? Other than appearing to come from ones own bank account in some foreign country. I assume the bank would ask for source of funds for larger transfers IE: over 100k USD -When coming from abroad. Even tough it is ones own account. What does one tell the bank if such "source of funds questions" arise?
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Benefits of personal dedicated IBAN account on crypto exchanges?
- Thread starter FinCent
- Start date
That's the selling point and it can help. But you'll eventually run into SOF/SOW checks if the amounts get high enough.
It's a stopgap solution.
Basically what you want is to off-ramp via entities that have to do due diligence so when you transfer from one entity to another entity, the secondary entity is reliant on the first entity doing it's job.
Where people go wrong is doing via non-entities (p2p) or questionable entities (say binance back in the day) where there are trust issues with the first entity carrying out it's required processes.
Now in some cases you have entities that are continuously moving through different financially licensed entities (i.e a branded processor swaps to a new financial entity frequently)
This is because they are cutting corners and their transactions are being flagged... so they do the old switch a roo.
The end client doesn't know but it basically appears like funds are coming from a new entity, and the banks are unaware as everything looks normal, but eventually the entity doing the switch a roo eventually has indictments and the user that was using said entity then has a microscope looking at them, and every fellow user of that entity (like all Binance users today).
Where people go wrong is doing via non-entities (p2p) or questionable entities (say binance back in the day) where there are trust issues with the first entity carrying out it's required processes.
Now in some cases you have entities that are continuously moving through different financially licensed entities (i.e a branded processor swaps to a new financial entity frequently)
This is because they are cutting corners and their transactions are being flagged... so they do the old switch a roo.
The end client doesn't know but it basically appears like funds are coming from a new entity, and the banks are unaware as everything looks normal, but eventually the entity doing the switch a roo eventually has indictments and the user that was using said entity then has a microscope looking at them, and every fellow user of that entity (like all Binance users today).
Mostly because your bank or EMI doesnt directly notice that the payments are being made to a crypto exchange. This is extremely helpful when using banks or EMIs that dont allow cryptocurrency transactions.
Also refer to my other thread to get some more inspiration
https://www.offshorecorptalk.com/threads/crypto-exchange-with-personal-virtual-iban.43202/
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