Yearly Archive October 12, 2022

Instruction how to transfer funds abroad using cryptocurrency from Russia

Russian authorities have restricted the transfer and export of currency abroad, but the legislation does not prohibit the transfer of funds in digital assets. Experts explained how to properly send money in digital currencies

On March 10, the Visa and Mastercard payment systems suspended operations in Russia. Since then, all transactions by cards of these systems are not available outside the country. This decision was announced a few days before the actual suspension. All Russians staying abroad were advised to withdraw sufficient cash.

According to the Association of Tour Operators of Russia (ATOR), as of March 15 about 25 thousand tourists could have stayed abroad. And after the start of a special operation in Ukraine, some Russians began to leave the country for purposes other than vacations. At the same time, Russian authorities have imposed restrictions on the transfer and export of currency abroad, as well as the ability to withdraw it in the country.

Cryptocurrencies have become one of the options for transferring funds in the current circumstances. This is legal because the Law on Digital Financial Assets prohibits Russian residents only to accept cryptocurrency as payment for goods, works or services. He added that there is no prohibition on transferring cryptocurrency from the wallet of a Russian user to the wallet of a user from another state in the Russian legislation.

“There are also no restrictions on such a transfer in the legislation on currency regulation, because cryptocurrency does not fall under the definition of currency values.”

On March 17, the Central Bank instructed banks to tighten control over clients so that they do not circumvent restrictions on currency transactions imposed due to sanctions. In particular, the regulator advised to pay attention to transactions aimed at the withdrawal of funds abroad or the purchase and sale of cryptocurrency.

“All of these measures mean delays in processing the transaction, explanations with the bank, and even refusal of the transaction, but are not a ban on cryptocurrency transactions as such.”

At the moment, there are no restrictions on sending cryptocurrency abroad or receiving it in Russia, as the turnover of digital assets is now in a gray zone. According to him, there is no linkage of public addresses to countries or IP owners, and it is possible to say that a purse belongs to a Russian citizen only within the AML (anti-money laundering) investigation. The expert clarified that if we are talking about a cryptocurrency exchange, in case of verification of the user it is clear to which region the account belongs.

Operations on buying and selling cryptocurrencies are not prohibited by the current legislation, agreed Nikita Zuborev, senior analyst at Bestchange.ru. He reminded that all regulations under development are at the stage of bills or have not gone beyond verbal interventions at all.

Major crypto exchanges stopped supporting direct deposits from a bank card because of technical limitations on the part of international payment systems, Zuborev pointed out. But if the user managed to deposit money to the exchange by other means, further transactions will take place in the standard mode, without any changes.

As for the mechanism of purchase on the OTC market, there are formally two separate operations: the transfer from card to card or from card to payment gateway (analog of the payment in the online store), and then the transfer of the cryptocurrency from purse to purse. Separately, these two operations are also not illegal, including the purchase process itself is not yet regulated by law, so it can not be recognized as something illegal, the expert added.

“The presidential decree prohibits only currency transfers – if the purchase was for rubles, and the transfer was made in cryptocurrencies (which are not yet recognized as currency in Russia), then even formal grounds for potential proceedings will not be.”

The easiest way to transfer cryptocurrency abroad:

Step one. Purchase cryptocurrency for fiat in Russia. You can turn to popular online exchangers, or physical exchange offices. There are enough such exchangers in major cities of the country, and they differ only in the percentage for services.

Step two. From your wallet, which received the purchased cryptocurrency, you can send it to another wallet. If you don’t have a wallet yet, you need to get one. Optimally, not on exchanges, but in anonymous mobile devices, or better as part of Ledger cold storage or other similar. Again, whether it’s overseas or domestically doesn’t matter: cross-border transactions with digital assets are not regulated, and if the essence of the transaction is not criminal activity, there will be no problems with such transactions.

Step three. If necessary, cryptocurrency obtained abroad can also be converted into fiat in a P2P transaction with local sellers of digital assets.

“Among the most optimal assets for such transactions, I would single out stabelcoins and low-volatility digital assets. Unless the goal is to make money on the potential growth of the cryptocurrency, it is better to send funds not in BTC, but, for example, in USDT, USDC, BUSD, etc.”

If the transfer is made through a non-custodial wallet, then it’s worth remembering that the transaction fee should be paid in the native token of the selected blockchain, stressed Bestchange.ru senior analyst Zuborev. That is, for example, to withdraw ERC-20 standard USDT, you need to have some Ethereum on your wallet as well, and for TRC-20 – some Tron. But when withdrawing from a cryptocurrency exchange, this necessity disappears – the organization takes an equivalent commission in the asset that is withdrawn. But you will have to pay for this convenience with your security – any exchange can freeze accounts, suspend transactions and so on at its discretion.

Where is the best cryptocurrency exchange: comparing platforms for trading cryptoassets

How to choose a reliable crypto exchanger. In this guide, we will tell you how to earn from the exchange of cryptocurrencies and where you can profitably exchange cryptoassets for fiat currencies.

With the advent of cryptocurrencies, many things have changed: business, communication and financial relationships. Before the advent of decentralized blockchain technology, you had to set up your own business in order to make money on the exchange of currencies. Moreover, institutions had to obtain special licenses in order to conduct these and other currency transactions. Of course, nothing has changed in this regard, although with the advent of Internet technology, the registration process itself has become easier. But it was cryptocurrencies that gave impetus to the formation of a fundamentally new market. Now, users don’t even have to leave their computers to make money on the exchange. What’s to say: now all it takes is a smartphone with an Internet connection. Could you imagine this 10 years ago?

How to make money exchanging cryptocurrencies

Using your computer or cell phone, you can mine cryptocurrencies, become your own retailer and sell goods or offer services, and conduct cryptocurrency exchanges – all from the comfort of your couch. In this guide, you will learn how to make money from cryptocurrency exchange using different services, how much you can earn and where to start the path of an individual entrepreneur in this field. Let’s go over everything in order.

How cryptocurrency exchange is regulated

Before taking the plunge into this new kind of business, you need to know the key rules. Of course, you can use foreign sites and payment systems to bypass taxes. But let’s be frank: all that nerve and secrecy is not worth the money you can save by avoiding income tax.

To begin with, cryptocurrency exchange is not formally regulated in any way yet. Requirements for cryptocurrency transactions will be established by the law “On Digital Assets,” which has not yet entered into force, developed in 2017.

There is no strict guidance on how you must register to operate: as a sole proprietor (PE) or self-employed. If you’re worried about the consequences, it’s best to consult a knowledgeable lawyer who can tell you about all the pitfalls.

According to the chapter of the Tax Code, any income of an individual, with some exceptions, is subject to personal income tax. This document defines the procedure and rules for paying taxes, depending on the type of income. It is unlikely that the tax office will be interested in you if you conduct several transactions in small amounts per month. But the constant circulation of large sums may attract the attention of the Federal Tax Service and lead to the blocking of funds in your accounts. That’s why we urge you to act in accordance with the law.

How cryptocurrency exchangers work: what you can earn from

The principle of cryptocurrency exchangers is quite simple. There are two main types of exchangers:

  1. Centralized, in which users exchange cryptocurrency with the service itself;
  2. Decentralized or peer-to-peer, in which users exchange with each other, and the platform acts as an analogue of a broker and guarantees the security of transactions.

We will not describe the whole process, starting from registration, but explain only the principle of exchange. How centralized cryptocurrency exchangers work:

You transfer money to the details of the service and pay a commission (it can be taken into account when calculating the purchase rate);
After the money is credited to the account of the exchanger, you are sent a predetermined amount in cryptocurrency.
Exchange of currency and cryptocurrencies through P2P-platforms occurs as follows:

  • You choose a seller and leave a purchase order;
  • The seller sends you the details to transfer funds;
  • At this time, the amount specified in the application is frozen in the seller’s account until he confirms the payment. In this way, the cryptocurrency exchanger ensures transaction security;
  • You send money to the details of the seller;
  • The seller confirms that he has received money from you;
  • The cryptocurrency is automatically sent to your internal P2P exchanger account.

As you can see, there is nothing complicated about this. It remains to figure out how to become this very seller and make money from cryptocurrency exchange.

How cryptocurrencies are exchanged at online exchangers

You do not need to perform any specific actions to start earning from the exchange of digital assets. However, there are a number of rules and guidelines that will help you at the start. Keep in mind that when using P2P exchanges, you will need to go through full verification (mail, phone, passport and selfies). This will expand transaction limits and increase trust from users. Potential clients will be more willing to work with verified accounts than with anonymous ones.

To start earning from exchanging cryptocurrencies online, you must first get a good reputation. The better the reputation, the higher the chance that users will turn to you. To do this, you need to make several transactions, get reviews and a high rating. You need to respond quickly to customer requests and make no mistakes. The first transactions may bring you a small loss, but think of it as payment for your reputation as a reliable counterparty.

Is electronic cryptocurrency exchange in demand

Yes, very much so. And the demand continues to grow. Exchangers keep transparent user statistics and show reviews, ratings, and the number of transactions made by the user. You can easily check for yourself how many transactions a particular seller has made and calculate how much his earnings could be on electronic cryptocurrency exchange. On average, sellers can earn from 1% to 5% per crypto-asset transaction. And that’s not taking into account the fact that they buy just as cheaply.

Which card you can exchange cryptocurrency to

Exchangers do not have any restrictions on this account. You can use cards of any banks and any electronic payment systems. Focus on what you yourself use, and what is in demand in the market. But please keep in mind, that some companies can impose their own restrictions, and exchanging cryptocurrencies to your card may be difficult. For example, the payment system PayPal restricts work with cryptocurrency and can block accounts if it suspects that you exchanged bitcoins with them.

What are the cryptocurrency exchange services that allow you to earn

You can make money from the exchange only with the help of P2P exchangers. Or you can organize your own exchanger and earn with it. Listed below are popular exchangers for earning:

  • LocalBitcoins;
  • Binance (P2P section);
  • Paxful;
  • Bitzlato;
  • LocalCoinSwap;
  • Sky Crypto.

There is another way to earn on cryptocurrency exchange services: many cryptocurrency exchangers offer an affiliate program, which allows you to earn a percentage of commission on purchases/sales by invited users. For example, Changelly has a profitable affiliate program for cryptocurrency exchange.

Services for cryptocurrency exchange

The most profitable online cryptocurrency exchanger
It is impossible to answer this question unambiguously, because the market is dynamic and the supply/demand balance is constantly changing. Now the lowest rate to buy allows you to set one exchanger, and in a couple of hours – another. It is impossible to predict.
Therefore, in order to reach a wider audience, you can use several online cryptocurrency exchangers at once. In this case, you don’t even need to change your details – use the same cards and wallets for different cryptocurrency exchangers.

What is the best cryptocurrency exchange site to choose

You should be guided, first of all, by your own comfort. Evaluate how favorable conditions the service offers, what restrictions there are and how big the flow of applications is. It may turn out that the most popular site due to high competition brings the least buyers. At the same time, a less popular platform may bring a higher and more stable flow of customers. Try different cryptocurrency exchange sites and compare in the field where it works best.

Cryptocurrency exchanges from $10

Pay attention to the limits set by the exchangers. By the way, it is not easy to find exchangers that provide purchase for small amounts from 10$. On many services you can notice that the minimum limit can be from $50 to $100. This is another feature of peer-to-peer cryptocurrency exchangers: you can exchange from $10 or even less. Some exchangers even have no limits, i.e. you can make transactions for $1, but this can lead to a large flow of micro requests, and it is not profitable to exchange such amounts, so sellers themselves set a limit of $10 and more.

How much can you earn when exchanging money for cryptocurrency

Here, everything depends on several factors:

  • The amount you dispose of. You may simply not have enough amount for full conversion;
  • Coverage – whether you offer an exchange from just one bank card or multiple banks and payment systems;
  • Application flow. Your competitors may be more reliable and offer better prices for exchanging money for cryptocurrency;
  • Demand. Sometimes trading activity drops and people are reluctant to use cryptocurrencies.

These are just some of the factors that are most obvious. In fact, there are many more. You can make $10 in a month and you can make $10,000. A lot depends on you as well. If you have a small flow, analyze why this is the case. Come up with original (though not necessarily) ways to attract customers. For example, write that users receive cashback. In general, fantasize, and you can come to success.

Where is it possible to exchange cryptocurrency for fiat

You can exchange cryptocurrency to rubles at the sites that we listed above (internal link). By the way, it is also possible on Binance. They support ruble pairs, deposits in rubles and the cryptocurrency exchange has a section for P2P exchange.

Are there cryptocurrency exchangers without fees?

We wrote about this in our other articles about buying Bitcoin and Ethereum. Let’s not dwell on it for a long time and describe briefly: any business exists due to profit, so the phrase “cryptocurrency exchanger without commission” is nothing more than a marketing ploy. Yes, it is possible. Some exchangers really don’t charge commission, but simply sell at a higher rate and buy at a lower one.

But you shouldn’t get too hung up on that. The commission of cryptocurrency exchangers on average is only 0.5% – 1% for the exchange. And it will be factored into the price so that you will earn more than 1% – 3% or more anyway. Now imagine that with a two-way exchange, the margin would be around 2% – 6%. Not bad?

If you want to know which cryptocurrency exchanger with the lowest commission – that would be LocalCryptos. Unlike other platforms, here ad creators pay 0.25% for exchange, and respondents – 0.75%. On such platforms as LocalBitcoins and Paxful 1% commission is paid only by users who placed an order.

To summarize briefly: cryptocurrency exchange without commission is possible only when recalculating the rate.

Where is the best exchange rate for cryptocurrencies

Unfortunately, there are no sites that monitor P2P exchanges and allow you to compare prices at different sites for different payment methods. Perhaps this is due to the technical complexity of the organization or is not demanded. Cryptocurrency exchangers’ rates can be monitored by BestChange service. However, it only monitors exchange rates of centralized services, which can be used to make money on affiliate programs.

Here’s a little tip: you can sell cryptocurrency at one site and sell it at another, depending on where the rate is more profitable. That way, you can exchange cryptocurrencies at a favorable rate. However, first, calculate the commissions when transferring from one site to another to make sure it is worthwhile. This approach is called interchange arbitrage. It is often used by traders and existed long before the advent of the crypto market.

Profitable exchange of cryptocurrencies

If you just want to buy Bitcoin (link to the first article) or sell it (link to the second article), we wrote about how to do that in our previous articles, so let’s just briefly list the reliable cryptocurrency exchangers (not including peer-to-peer):

Coinbase (not available in all countries);
Mercuryo. Supports its own wallet, where you can exchange cryptocurrency (Mercuryo | Multicurrency Crypto Wallet) for rubles and other currencies;
Coinmama.
The list of exchangers is limited because most services offer a rather high rate, so they can hardly be called profitable. Profitable cryptocurrency exchanger you can find among such major exchangers as Binance, CEX.io, OKEx, Kraken and others. There is no need to look only for those platforms where it is cheapest to convert cryptoassets. Convenience and speed of conversion are equally important.

Which wallet to choose to exchange cryptocurrencies

Not all cryptocurrency wallets support buy/sell functionality. P2P-provide storage services, but this is not the safest way for holders. It’s much safer to use cryptocurrency wallets with private keys, such as Mercuryo, Coinbase or Trust Wallet. You can use them to securely exchange cryptocurrency right in your mobile app. These are convenient and fast cryptocurrency exchange wallets.

What’s the best cryptocurrency wallet with exchange capabilities

It depends on your individual preferences and other factors. Some wallets are quite safe, but they have other limitations. For example, Coinbase is considered one of the safest cryptocurrency exchange wallets, but it is not available in all countries. The other two wallets, Mercuryo and Trust Wallet, are safe and available in most countries. You can use them to buy cryptocurrency for rubles, euros and other fiat currencies.

Is it possible to earn money by exchanging cryptocurrencies

Yes. You can become a seller or just invest and sell cryptocurrencies at a higher price, or you can become a trader and earn from the difference in rates. The method you choose depends on your skills and goals. The more complex the method, the higher the potential profit, but the risks are also higher, so they require high skills. For example, earning on cryptocurrency exchange through P2P exchanges does not require crypto-trading skills: you just need to respond to users’ requests and transfer money. At the same time, the risks are quite low. Trading, on the other hand, is associated with high risks. You can lose your capital in just one month if you have no trading skills.
If you want to earn income without skills, then find a suitable cryptocurrency exchanger website and become a seller. At first, it will be hard to get bids and there won’t be many of them. But with the right persistence you will be able to reach a stable income.

How not to get your bank account blocked when dealing with cryptocurrency

The Central Bank has recommended that banks block cards that are linked to cryptocurrency exchanges. Who will be affected by the new rules and how to avoid possible problems when selling or buying digital assets

Last week, the Bank disclosed a scheme for using payment cards and e-wallets to accept payments to illegal online casinos, organizers of financial pyramids, forex dealers and cryptocurrency exchangers. According to the methodological recommendations of the financial regulator, banks should identify such payment instruments and block them.

The Central Bank statement says that illegal businesses may use bank cards or electronic purses, which are often registered in the name of fictitious persons. Such accounts are not used for everyday payments, utilities and other services, but there are unusual transactions in terms of frequency and amounts.

To process such payments, the shadow business uses special software, which is connected to bank Internet pages providing the service of money transfer from card to card. In this case, the necessary data for implementation are filled out automatically.

Banks are recommended not only to block operations with suspicious cards and purses, but also to terminate service agreements with clients in case of more than two blockings during a year. Accounts that fit two or more items will be considered suspicious:

An unusually large number of counterparties who are individuals, both payers and recipients of funds. More than ten per day or 50 per month;
An unusually large number of credit and debit transactions conducted with individuals. More than 30 transactions per day;
Significant volumes of transactions of debiting and crediting of funds performed between individuals. For example, more than 2000$ a day and more than 20000$ a month;
a short period of time (one minute or less) between crediting and debiting transactions;
12 hours or more than one day of transactions for crediting and debiting funds;
During the week, the average balance on the card or purse account at the end of the operational day does not exceed 10% of the average daily volume of transactions on the account during this period;
the card or the wallet does not perform operations on payment for goods or services;
The use of the same device by different individuals for remote access to the money transfer services of the credit institution.

Can a cryptocurrency user’s account be blocked?

If a cryptocurrency user actively uses his personal account to buy and sell cryptocurrencies, and the number of his transactions and counterparties exceeds the values specified in the methodological recommendations, then yes, his account can be blocked by the bank.

If the account is blocked, you need to contact the bank and convince it that the account is not used for any illegal purposes. You should be prepared to back up your words with documents.

He pointed out that in terms of current legislation and the Central Bank the use of a personal account for any activity aimed at systematic profit making (entrepreneurship) is illegal. In Russia, to engage in entrepreneurial activity, the current accounts of a sole proprietorship or a legal entity, or the account of a citizen registered as self-employed, must be used.

If a citizen is not registered in any of these capacities, but actually uses his personal account, for example, to earn money on cryptocurrency, he is, from the point of view of the Central Bank, engaged in illegal entrepreneurial activity.

How to avoid blocking?

To avoid blocking accounts, it is necessary not to exceed the limits specified in the recommendations of the Central Bank and not to perform other actions with their personal account, which the bank may consider suspicious, the expert explained. According to him, it’s better to use a current account of an individual entrepreneur or a legal entity to trade cryptocurrencies.

The law does not fully regulate the activity of buying and selling cryptocurrencies, as well as the legal status of the cryptocurrency itself.

“The way it is done in the law on digital financial assets is, alas, hard to call it regulation – from terminology (digital currency – cryptocurrency) to the selective recognition of digital currency as property for a limited list of transactions.”

The recommendations do not speak of the unconditional blocking of bank accounts, with which cryptocurrency is exchanged, the agency only encourages banks to check them in more detail for the use of obviously illegal payments, the expert reminded. He advised to refrain from using the services mentioned in the statement of the Central Bank, as well as to think about structuring the activities of cryptocurrency exchange within the legislation.