How do you buy real estate with crypto? Should you?

“This has put me in a difficult position. I completely understand the necessity of AML regulations in today's financial landscape, especially concerning real estate transactions involving cryptocurrencies. Yet, the sudden requirement to prove the legitimacy of my assets, as if I'm under suspicion, has been quite disheartening.

“I'm reaching out to see if anyone in this community has experienced similar hurdles, especially in real estate transactions involving crypto payments. How did you navigate the AML checks? Any advice or insights on expediting this process would be immensely helpful. The last thing I expected was for my investment journey to be stalled by bureaucratic processes, especially when I've made every effort to comply with the law.”

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Reed answer:

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I do not understand why you are in a difficult position. Also, I encounter the same requirement when I buy real estate with foreign currency. I convert the foreign currency to US dollars, but you have to prove to the lender/title company how you got the money. The reason is criminals use buying real estate with proceeds of illegal activity as a way to launder it.

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I also recently took a bunch of old Swiss francs to the Swiss National Bank in Zurich to trade them for current Swiss francs. I took my receipts from when and where I bought the Swiss francs to prove their origin. At each airport whether I was departing or arriving, I always went to the customs office, often hard to find, to declare my Swiss francs. At the first such airport, I had to fill out a form about them. I took cell phone photos of that form and showed it to the customs guys at each stop.

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So welcome to the 21st century. You want to be a big time finance guy who buys real estate with crypto, become professional about it. That means you keep all your receipts and take them with you when you go to customs or closing. It also means you do not whine about it.

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There is a hint here that your real problem is you cannot document that you got the crypto legitimately. That is not a problem for REDDIT members to explain. If you end up in jail, your fellow prisoners there may have the answer you seek. Although if they are in prison, maybe their figuring it out how to buy things with crypto is a work in progress.

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And here’s an idea, why not convert the crypto to US dollars for the real estate purchase. If I were the seller, I would probably direct the escrow company to wire the money to one of my foreign bank accounts. The receiving bank then would convert it from US dollars to their currency.

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All your talk about stalling or hurdles makes no sense as I described above. Why is showing them a receipt a stall or a hurdle? Sounds like your problem is not with the bank. It is with your lack of the paperwork a legit buyer would have.