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Perfectly legal: Bitcoin over the counter, below the radar
#cryptooverthecounter: Private-to-Private Bitcoin Trade
Bitcoin Over-the-Counter stands for buying and selling Bitcoin (or other cryptocurrencies) peer-to-peer in a private environment. It avoids the use of crypto exchanges, including so-called "OTC desks" and their excessive regulatory hurdles and requirements. However, the private BTC transaction is complex and only advisable when other transaction structures fail or result in a less than favorable outcome. Therefore, this option is very attractive (only) if the circumstances are right.
Buying and selling cryptoassets over-the-counter, without the protection of regulated institutions, poses unique risks, challenges and pitfalls. In a malfunctioning transaction, the Bitcoin seller can lose his coins without getting paid. The buyer could pay without receiving digital title to the cryptocurrency. In addition, the payment could be challenged, reversed, and charged back later, while the blockchain transfer remains immutable. In the worst-case scenario, an ill-advised Bitcoin investor could find himself unwittingly involved in criminal behavior.
As a result, it is imperative to thoroughly understand the transactional design, structuring options, and risk mitigation opportunities when participating in a private-to-private Bitcoin trade. Proper oversight by experienced counsel will keep P2P BTC OTC safe and protected from both loss and illegality.
Bitcoin Over-the-Counter | Insights
#cryptooverthecounter: Terminology, Details, Opportunities
A closer look at peer-to-peer crypto trading reveals a wide range of legal, tax, financial and practical issues. Peer-to-peer buying and selling is aimed at different participants than the crypto exchange or so-called OTC desks, which are basically subject to the same regulatory requirements as the exchange itself.
Before entering into the transaction, it is imperative to understand the requirements of being RWA (ready, willing and able) and the extent to which the coins must be GCCN (good, clean, clear and of non-criminal origin). It is critical to understand the extent to which the transaction structure is professionally designed to allow KYC (know your customer), AML (anti-money laundering) and CDD (customer due diligence) investigations to be legally substituted for secrecy, confidentiality and privacy considerations in accordance with a prudent N2K (need-to-know) policy.
The implications of the various payment mechanisms should be considered. These include the amount and currency; whether the funds are held in a bank account, in cash, or otherwise; and the location, jurisdiction, ownership, control, and authority over the funds. Emphasis should be placed on the various escrow arrangements and their impact on overall risk management. Proof of funds, proof of coin and procedural considerations should also be discussed in detail. Finally, participants need a holistic view of real-world cases and good (or bad) industry standards.
Modern Crypto Asset Protection Strategies
#cryptooverthecounter: Professional Advice and Transaction Support
PUGNATORIUS S.A. is an independent niche consulting practice focused on modern digital asset protection strategies for Bitcoin millionaires and people whose wealth lies outside traditional banking channels. An integral part of its professional services is crypto over-the-counter advisory and peer-to-peer transaction support. The firm's president, Dr. Ulrich Eder, is a highly experienced leader in this sensitive niche industry.
Given the overall crypto environment, it takes more than just somehow getting the crypto OTC deal done. Participants need counsel who understands that there are legitimate reasons to give privacy a higher priority than it is offered in the regulated crypto industry. They need independent advice on how to take advantage of existing opportunities to avoid onerous KYC investigations and keep personal and business data confidential.
Based on years of successful hands-on experience in the Bitcoin OTC space, our consulting firm provides comprehensive assistance and transaction support to avoid OTC mistakes that have been made by others in the past. We monitor and advise throughout the signing, closing, crypto transfer, payment, escrow procedures and additional steps and requirements. Lessons you do not want to learn the hard way.
Find out what the firm's president had to say to an exclusive audience at the conference in Dubai.