I want to be a crypto trader and trade cryptocurrencies with my bank account. How it works is the seller would put his coins into an escrow account, the buyer will transfer him the money, and then the seller will release the coins. This type of crypto trading is called P2P trading, and fewer fees are involved.

I plan to trade about 5 to 10k every day. I will most likely make smaller trades (under 1k) with Zelle and larger trades with wire transfers. Since I will be depositing and withdrawing large amounts of money from my bank account every day, would there be any risks of being reported for, say, money laundering even though I'm just trading? If I "do a substantial amount of business in the US," I will need to register with FinCEN, but what defines a substantial amount? Is trading crypto even considered as doing business? It feels more like investing, or in a sense, gambling. What other legal precautions should I take?

An alternative to using my bank account would be using services like PayPal or Wise. Would that be safer? Since it is normal for people to send and receive money daily on those platforms. Should I take any legal precautions while transferring cash on these platforms?

My goal is to trade crypto for fiat on P2P trading platforms like LocalBitcoins. However, I do not want to use centralized exchanges or trade crypto for stablecoins on decentralized exchanges. So, how can I do P2P trades safely? Thanks a lot!

  • 7
    You are probably being scammed. You'll Zelle or wire-transfer $10k to a fake 'escrow' service, and both the service and the $10k will vanish.
    – Shawaron
    Commented Feb 15, 2022 at 15:22
  • @Shawaron, No, P2P trading is a real thing. Just search up LocalBitcoins or Paxful Commented Feb 15, 2022 at 20:52
  • 7
    @Benjamin2002 A transaction involving an escrow account is very much not peer-to-peer. It's peer-to-escrow-to-peer.
    – ceejayoz
    Commented Feb 16, 2022 at 12:59
  • And why would people work with you rather than someone with a more proven track record, better security, better insurance, ...?
    – keshlam
    Commented Feb 24, 2023 at 21:57
  • Benjamin, that’s what they say before they are scammed.
    – gnasher729
    Commented Feb 25, 2023 at 12:25

1 Answer 1


The business seems to be a money transfer service and that is regulated by FinCEN when in the U.S. And some type of designated bank account might be required.

But also institutional crypto custody might be required because just having a business doesn't make someone a fiduciary. And institutional crypto custody is in the news.

The peer-to-peer systems that I have looked at had people offering crypto at a high prices. But the central business just waits for confirmation of a financial transaction received by the seller and doesn't handle the banking. The central business does probably handle its own crypto custody. And so the business is partially based on private messaging between peers.

Another crypto business opportunity is staking whereby someone who FULLY stakes can run a computer as a validator of proof-of-stake blockchains. The problem is that the biggest stakers have the advantage and some of them are very big. Also, partial staking using pools is being shut-down by regulators.

And yet another crypto business opportunity are liquidity pools of swap systems whereby someone can deposit two cryptocurrencies into an automated market-maker and earn trading fees. And the largest market-makers have the advantage.

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