Why banks hold up crypto payments in particular
For a bank, a transfer from a crypto platform is a standard AML monitoring trigger, regardless of your reputation or how long you have banked there. Whether it fires depends on the amount, the frequency, and how well the payment fits your profile: a salaried client receiving several years' income in one payment will be reviewed without fail.
What the bank may lawfully request
- Source of funds — the same file the exchange asks for, but with the emphasis on the origin of your original capital: the method and structure.
- Platform documents: the account statement, the trade history, and confirmation that the withdrawal went to your account.
- The tax status of the transactions — returns or an explanation, where the income was declarable.
These demands are lawful: a bank is obliged to document its client's source of funds. Refusing to answer almost always ends in the payment being returned to the sender or the account being closed.
What to do
- Do not break the transfer up. Trying to stay under a threshold with a series of small payments is a red flag in its own right, and it damages your position more than the original review would have.
- Answer in a single package with a covering letter and a chronology: purchase of the asset, holding, sale, withdrawal.
- Prepare the documents before the transfer, not after the block — especially for large amounts and a first payment.
- If the payment was returned, agree a repeat withdrawal with the platform and notify the bank in advance about the nature of the incoming funds.
When it becomes a dispute
If the documents have been provided and the account remains blocked for weeks with no further requests, the same logic applies as with platforms: a written letter of claim and a complaint to the financial regulator. If the bank cites a request from a competent authority, this is already an externally ordered freeze, and it is not resolved by corresponding with the bank.
Frequently asked questions
Why is my bank asking for a source of funds on a transfer from an exchange?
AML regulation obliges the bank to document its client's source of funds, and an incoming payment from a crypto platform is a standard monitoring trigger.
Is it lawful for a bank to block an incoming payment from a crypto exchange?
Suspending the transaction for review, yes. Holding the funds indefinitely without stating a basis, no: that is a matter for a formal claim and a complaint to the regulator.
What do I do if the bank returned the payment to the exchange?
The funds go back to your platform account. From there, agree a different withdrawal route and prepare the documents for the receiving bank in advance.
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