Crypto Merchant Account

[Rick Ross 305]

Hi, I know someone with a small business offering online services, he wanted to be able to accept crypto/ stablecoins/ bitcoins as form of payment.
What is the road to do that please? Does he need a merchant account in one of the exchanges?
If eventually the payments are sizable, like 7 figs, would that still work?
Any insights on how/ where to kickstart appreciated.

 

[bullhorn offshore]

Hi, I know someone with a small business offering online services, he wanted to be able to accept crypto/ stablecoins/ bitcoins as form of payment.
What is the road to do that please? Does he need a merchant account in one of the exchanges?
If eventually the payments are sizable, like 7 figs, would that still work?
Any insights on how/ where to kickstart appreciated.

Hi.
Your client will register a company where it is allowed to work directly with crypto assets. If he wants to trade directly without using crypto exchanges, using cold wallets. The expense to "whitewash" the transaction is costly.

Second option:
Organize the process of working through crypto exchanges. Companies can be registered in the UAE, Portugal, etc. The client will be able to save on transaction costs and have a clean document flow.

 

[CyprusLawyer101]

Why is it necessary to white wash the transaction if the payments would be for legit services?

 

[Rick Ross 305]

Why is it necessary to white wash the transaction if the payments would be for legit services?

Exactly

 

[bullhorn offshore]

Exactly

Why is it necessary to white wash the transaction if the payments would be for legit services?

Hi all.
Cold crypto wallet.
From experience:
Cold crypto wallets are used more often by counterparties, there may be no documents confirming the origin of funds.
Calling counterparties and asking for all documents has to be done or immediately. Such requirements reduce the customer base. Some transactions will have to be whittled down by documentation.
You provide a service - you get paid.
You want to exchange this cryptocurrency for FIAT money. The exchange will ask you for the origin of the funds. You demonstrate:
- the contract for the service.
- The origin of the funds from the counterparty.
- Exchanges want to see where they paid taxes for these funds (more often for large amounts).
hence, if you sold a service for 100 bitcoins in total, you will have to collect documents for each.

The exchange rate does not appear profitable because of the above. Use exchange crypto acquiring to save money.

 

[CyprusLawyer101]

Hi all.
Cold crypto wallet.
From experience:
Cold crypto wallets are used more often by counterparties, there may be no documents confirming the origin of funds.
Calling counterparties and asking for all documents has to be done or immediately. Such requirements reduce the customer base. Some transactions will have to be whittled down by documentation.
You provide a service - you get paid.
You want to exchange this cryptocurrency for FIAT money. The exchange will ask you for the origin of the funds. You demonstrate:
- the contract for the service.
- The origin of the funds from the counterparty.
- Exchanges want to see where they paid taxes for these funds (more often for large amounts).
hence, if you sold a service for 100 bitcoins in total, you will have to collect documents for each.

The exchange rate does not appear profitable because of the above. Use exchange crypto acquiring to save money.

If the contract of service is available, if taxes have also been paid and proff ia provided, would an exchange still request source of funds from counterparties?

 

[bullhorn offshore]

If the contract of service is available, if taxes have also been paid and proff ia provided, would an exchange still request source of funds from counterparties?

Crypto exchange received a license in some country, it all depends on which country.
Large crypto-exchanges require a lot of documents, for the amount of exchange above 50k usd. Some began to ask for amounts he 5k usd last three months.

These changes influenced the exchange rate for large amounts. Now to exchange a million usd require a commission of 15% more often I see such proposals. Offered an exchange service of 4%-7% for 10 million usd a year ago. Today the costs have increased and it is difficult to do anything cheaper than 10%.

 

[CyprusLawyer101]

Crypto exchange received a license in some country, it all depends on which country.
Large crypto-exchanges require a lot of documents, for the amount of exchange above 50k usd. Some began to ask for amounts he 5k usd last three months.

These changes influenced the exchange rate for large amounts. Now to exchange a million usd require a commission of 15% more often I see such proposals. Offered an exchange service of 4%-7% for 10 million usd a year ago. Today the costs have increased and it is difficult to do anything cheaper than 10%.

Thanja for your reply. I am not sure my question has been answered. Lets say I sell my services and accept crypto payments. I have 10 clients each pays me crypto of 10k usd equivalent. If i go to change my crypto to fiat through any exchange would they ask me for source of funds of each of my clients?

 

[bullhorn offshore]

Thanja for your reply. I am not sure my question has been answered. Lets say I sell my services and accept crypto payments. I have 10 clients each pays me crypto of 10k usd equivalent. If i go to change my crypto to fiat through any exchange would they ask me for source of funds of each of my clients?

Yes, you will be asked for documents confirming the origin of funds, in your case it is a service agreement.
If the amount of exchange is higher than 50k usd, then the crypto-exchange will request documents of origin of funds from your counterparty with a higher degree of probability.

If you find a licensed crypto exchange that does not require documents for such transactions, let me know.

 

[Rotor]

Thanja for your reply. I am not sure my question has been answered. Lets say I sell my services and accept crypto payments. I have 10 clients each pays me crypto of 10k usd equivalent. If i go to change my crypto to fiat through any exchange would they ask me for source of funds of each of my clients?

That's a very good concern. For example if you receive a payment of ETH that has gone through the recently banned TornadoCash, your exchange account will probably be frozen right away. Even if you provide the documentation on your side, it might be painful to get it back.
To be clear if the crypto comes from dodgy sources or mixers, the exchange will see it right away and might block the account. And then it can take some time to get it functionnal again. And some exchanges are just awful, like Coinbase and Co.
Some merchants accept cryptos payments without restrictions, I'm not sure what their policy is. Maybe they have a Chainanalysis software or not.
The safest bet is to keep the crypto for yourself but it's not always practical if you need fiat to pay bills.