As we are helping more and more clients to cash out their crypto wealth in Swiss private banks, we give you a sneak peek into the process of banking crypto whales in Switzerland!
April 5rd 2023
How easy it is to buy or cash out crypto in fiat usually comes down to how understanding your bank will be about those transactions. This is why it is important to work with a crypto broker regulated in a trusted jurisdiction like us, which gives the bank the critical assurance that another regulated entity subject to equivalent KYC/AML standards will have already greenlit the client.
But when we enter the realm of crypto whales moving 7+ digits amounts between fiat and crypto, the vast majority of retail banks are out of the picture as they are simply not equipped to deal with that category of client.
For them, private banks are the way to go as they are specialized and used to onboard clients with unique profiles on a case-by-case basis. Still, in spite of their apparent appetite to open accounts for crypto wealth, it is still very challenging for them to do so directly. Most of their compliance staff has an inherent suspicion regarding cryptocurrency and their senior management is often fundamentally distrustful of anything with the word "crypto" in it. They are therefore not properly geared to onboard clients coming from that space and don't have the knowledge and tools required to perform a proper due diligence on the origin of funds coming from the crypto world. As a result, expecting a private bank's compliance team to do their job willingly and efficiently with a big crypto client all on their own is a long shot.
That is why it is not recommended to try opening an account with a private bank on your own. If you do, you will most likely be rejected as, again, crypto means headaches for them since they won't know how to start documenting your case. Worse, you can put yourself in jeopardy if a bank decides to report you to the authorities. Yes, that can happen: banks have a duty to report money laundering suspicion, even if they did not sign a contract with you! Misunderstandings about the client's story can therefore lead to such kind of very unfortunate consequences.
Until banks will have evolved and get sufficiently familiar with the crypto space, an interface will always be required to ensure that things go smoothly. That is where specialized intermediaries like us enter the picture, as we can take care of all that work.
The track record that we have built in Switzerland as a regulated financial intermediary specialized in crypto services gave us over the years a solid reputation among the local financial ecosystem, and we have developed relationships with most of the private banks here that can be used to help crypto clients open bank accounts.
When new clients contact us and express their needs for that service, we first onboard them through our regular KYC process, which is entirely done in-house. We know how privacy and data safety are important in the crypto world, which is why we always emphasize that point and stress the fact that all our clients benefit from Swiss secrecy.
Once that initial KYC is done, we then schedule a meeting to start drafting the file that we will use to present the client's case to the target private banks. When completed, that file will include a comprehensive portrait of the client's crypto wealth, its origin and its fiscal status.
Depending on the client's profile and wealth management needs, we will suggest the most relevant bank from our network (we only deal with private banks, which are focused on wealth management). With the client's approval, we will go on and request a bank account opening.
We then take care of all the follow-up work with the bank to ensure a swift process until the actual account is open and ready. Once done, we proceed to the actual cash out of the funds: the client transfers the crypto to our wallet in one or several transactions, which we then convert into the desired fiat currency through our liquidity network. In most cases, clients will cash out stablecoins that we redeem directly with their issuer. We have direct relationships with:
Finally, we transfer the fiat funds directly onto the newly opened private bank account, ready to be used. That whole process can be completed in less than a month!
On our side, we charge for that service an all-inclusive one-off fee of less than 1% of the amount transferred. That fee includes all our compliance work, the preparation of the circumstantial report for the bank and the assistance with the account's opening.
On the private bank's side, they usually apply an all-in-one fee (custody and transactions) around 1% of the asset under management. We can usually help negotiate that fee down thanks to our good relationships with banks. Of course, additional fees regarding tax consulting and restructuring may apply, but in all cases we will ensure that you pay the right price.
Here is a non-exhaustive list of the different types of client profiles for which we have built successful cases for cash outs and bank account openings. They describe what needs to be demonstrated for a successful process, which is to detail what funds were used to generate what profit. Fortunately, the blockchain is an open ledger and tracing transactions is constantly getting easier with more and more sophisticated tools.
If you're interested in cashing out funds with us, don't hesitate to get in touch!Contact us