Topic: How to buy large quantity in cash (Read 6609 times)

My two methods for purchasing large quantities of BTC with cash in the USA would be bank deposit. You simply walk into the bank of the seller, fill out a deposit slip (name, account #, amount) then pull out your wad of cash, and hand over both to the teller. Done!

Second would be a in person meet up.

maybe theyre not those kind of bills 

Oh right the solution to paying bills is:

USD -> BANK -> DWOLLA -> MTGOX -> BTC -> USD -> MTGOX -> DWOLLA -> BANK -> PAY SOME BILLS

 

Even better!  Discount when buying bitcoins and paying cash -- minimum buy $200.  That's quite a deal!

 - https://bitcointalksearch.org/topic/bitcoins-direct-support-thread-87094

That would buy a lot of AK-47s for some "freedom fighter" group over seas. Just sayin.

Not illegal here in the US.  You can posses as much cash as you wish.  When you move across national borders you have to declare it and the amount is limited.  I hear that in China it is very hard to move cash out of the country.

@André, are you sure you mean "cash" as in "dinheiro vivo/em espécie", or do you just mean to buy "à vista"?

I think just having such amount of cash with yourself is illegal in most places, unless you have proper authorizations.

It still does.  Exchanges are imperfect pricing engines.  All that matters is total aggregate supply and total aggregate demand.  If your friend couldn't sell it offline then you "may" (and over 1,000s of "hoarders" some % will) instead sell them on the market.  Just as you taking the buy off the market removes buy side information it also removes an equal amount of sell side information.  

That isn't to say OTC doesn't have advantages.  We use it every day.   We probably are the largest non-exchange buyer and seller (at least one that is open to the public).

The main advantages are:
a) flexibility - we can structure deals which would be difficult or impossible on an exchange
b) limited trust - our clients only need to trust us for one trade.  the amount of funds that are at risk for hacking/theft/seizure are much lower
c) speed - we can complete a deal (supply depending) the same day

However all demand and all supply affects the price; even demand and supply not on the market.

While true your statement has no value.

While any sale (even a penny) will affect the market what matters is how much it affects the market.

Buying $200K via a single market order on a single exchange executed over the course of seconds will have a much larger effect on price than say buying $5K to $10K at a time OTC over the course of a month.

Yes OTC does make a difference.  While all demand adds to price OTC trades are "hidden" from speculators.  They don't have the trade history and momentum to capitalize on.  If you try to buy $200K on the market you wouldn't be adding $200K in demand you will be adding $200K plus whatever $xK speculators pile in trying to catch "the rocket".

if i sell my friend 19k btc (200k$ worth) ive been hoarding offline  and then he hoards them offline  ,the market will not be swayed  from that transaction

Nonsense

If you buy 200k$ of bitcoins you move the market, no matter what. The fact that it's OTC means nothing

20,000 BTC/USD 200,000 isn't really all that much if you trickle it into the market over a few days or spread it around the exchanges.  You could use it to create walls if you wanted to, but there's no reason why you have to.

And no worries about moving the market. Assuming you can find someone who can buy/sell that many without running to MtGox to offset it.

I think the issue might be getting around the currency restrictions which are in place in some South American countries.  Buying OTC means there'd be no record of the cash entering the Bitcoin system or of the Bitcoins being withdrawn - and no concerns about KYC/AML requirements.

Nice detailed comparison as always Stephen.  As a correction I would point out we charge never charge a fee and currently (but not always it depends on supply) are offering a 1% discount so in effect a negative fee.

If one *legally* had $200,000 in USD paper, how would such a person get it across national borders? Might be easiest to buy $200k in coins, move to the new country, then repurchase the USD.

there is probably miners and hoarders in every country /major city
put some ads up online and someone will probably contact you

bring your laptop to starbucks and buy them from private sellers etc
face to face is easy when nobody trusts the other persons

Appears that you have several problems to solve then.  

There won't be a single direct seller or even sets of them with the capacity to accept a couple hundred grand in cash in exchange for bitcoins.  

So your first problem is essentially comes down to ways to move cash (an offline non-reversible medium of exchange) into an electronic form that is compatible with bitcoin.

Of course, the banking system does this very well for not a whole lot of money.  You simply deposit cash and send a wire transfer to an exchange that can accommodate the size of your order

Using the buy calculator from Clark Moody shows that you can accomplish a $200K USD purchase in a single buy and pay on average about 5% above spot (using the market depth at the time) at Mt. Gox.

Buying chunks at a time will give those who perform arbitrage against the other markets (e.g., the BTC/USD at BitFloor, the BTC/EUR at Intersango, etc) a chance to bring supply to you but at the same time doing that runs the risk of tipping off other traders that will front-run you by anticipating that you will be buying further.

But that's definitely something that can be accommodated solely on a single exchange without too much of a penalty.

Now that the value of all bitcoin's calculated at the market exchange rate (which some refer to as the "market cap") is about $100 milliion, a $200K purchase doesn't move the exchange rate like it used to.   It is still a very significant amount though.

Knowing in advance the volume and the likely effect on price you then the derivatives available might be employed.

If you don't immediately need the entire bitcoin proceeds from your purchase at the exchange, then you might buy CALL options for some of your purchase.  This allows you to have a known upper bound on price for those.  So then you start buying bitcoins on the open market for the remaining quantity you don't already have CALL options for.  If the exchange rate remains below your exercise price you can keep buying and sell to close your CALL option to get back most or all of the premium you paid for it.

There are quote a few methods available to you to accomplish your aim.

Now, I was purposely being obtuse here.  You specifically mentioned cash, and you probably did not want to consider the option of cash being sent through the bankiing system.

So that brings to the fore the other problems you need to solve.   And these other problems aren't quite as easy to solve.

There are other methods to convert cash into electronic form.  


In the USA, of course, there is BitFloor which accepts deposits at Chase bank and Wells Fargo. There are no fees, though there are daily AML limits.  An additional method includes FastCash4Bitcoins.com (deposit cash at Bank of America, costs about 1% currently you can even buy at a 1% discount).  Get-Bitcoin and QuickBitcoins.net accept cash-by-mail.  Most remaining methods like BitInstant, AurumXChange and others use TrustCash to accept cash at major banks.  There is a fee for this, under 4% for larger amounts.

You would hit daily limits even using a combination of all of these well before you even start knocking away at your $200K buying intention.

In Europe, there are currently fewer options for turning cash into electronic form.  There is Bitcoin Nordic which accepts cash-by-mail (USD, EUR, and other currencies) .  There is the option to buy UKash vouchers, and to redeem those through a CashU online account which can then be used to purchase bitcoins -- also at Bitcoin Nordic and at MercaBit.eu as well.  That is an expensive method and there are daily limits as well.

In Brazil, cash deposits are accepted at Banco Recomendito and using Boletto (via BitInstant, QuickBitcoins.net, and others).  Daily limits apply here as well.  UKash vouchers can also be purchased in Brazil and redeemed though CashU for funding at Bitcoin Nordic or redeemed directly through MercaBit.eu

Bolivia too is another place where UKash vouchers can be purchased and redeemed through CashU with funds used to purchase bitcoins through Bitcoin Nordic or redeemed directly through MercaBit.eu.

While there are quite a number of individual methods to move smaller amounts of cash to bitcoins, they do not combine easily to allow fast conversion of such a large amount.

There are likely other approaches.  For instance, offering to provide bitcoin cash-out service will yield bitcoins in exchange for an outlay of cash.

Here's an example of a person trading bitcoins for cash in which the cash is then sent by mail or deposited into a bank account.   You might consider offering that service.  Even if this is done for small amounts per-trade though, there still might be restrictions on offering this though, depending on your jurisdiction.

Now this may seem like quite a hassle, but consider how a about a year ago just to do this type of cash buy with just $20K would have been even more of a hassle.  The options available are developing and improving continuously.

There's probably an approach that works uniquely well in each geographic location, but the methods all have a common denominator (bitcoin traded for something of value) and this exchange can complete without needing services from the banking system.

The joke wasn't clear to me.  But now I get it.  $200,000 is a lot.  .  Maybe I was joking too.  If I had 20,000 bitcoins maybe I would just gamble them away, or buy alpaca socks for Everyone in France.  But the serious question is: what is everyone doing with all these millions of bitcoins.  With the price spike there must be a use for them other than mining and selling.

I think there is no matter whether you say it or not. This is in everyones mind. Doesn't the whole idea of private money, independent from government, say this loudly? Independent from government for what? For this and that and that and ... to not give 50% of your hard earned fruits of your labour to any one by coercion. Any ever more!

I'm not doing that, it was just a joke ...

Why do people do this?  Some things are better left unsaid.  If you got coins from selling a mountain of weed it is better to not say it.   If you need to unload some coins cheap because you stole them it is better to not say it.  If you are sending coins to the Silk Road it is better to not say it. Most certainly if you are planning of evading taxes it is better to not say it.

Why?  Why do people do this?  What possible good could come from divulging the reason for your transaction?  Does nobody care about financial privacy?

But put do you put on the deed?  Doesn't the government there monitor real estate transaction and ask for their taxes.

You're right! It´s to avoid taxes!

Very good! Congratulations!

Wow.  I wonder how much real estate has been transacted in bitcoins.  Is this to avoid taxes?  Here in the states when you transfer a deed you have to say how much money was exchanged and then pay taxes on it.  Writing the deed with 20000 bitcoins doesn't sound like it would work.

Maybe he's going to buy 20000 bitcoins then sell them for dollars and pay some bills.

It's to buy house and apartment in South America

You should also check our service localbitcoins.com - location-based bitcoin-to-cash marketplace.

Someone who can drop $200K on a speculative investment is not likely hurting for cash to "pay some bills".

Why does anyone want 20000 bitcoins?  What can you do with them that is worth that much money?  If I had 20000 bitcoins I would sell them for dollars and pay some bills.

FinCEN's Anti-Money Laundering (AML) regulations would require a Suspicious Activity Report (SAR) to be filed for any amount over 10,000 in one day for a single user.  Try HSBC.

Yeah he would be on the short list.

pirateat40

Well $200,000 is definitely large.  This is obviously beyond Tangible Cryptography ability to handle in a single sale.  I don't want to speak for other vendors but I doubt many people could handle that.

Your best option is probably multiple sales from a variety of sellers.  It will take longer but the advantage of buying using a large number of smaller sales is you get some dollar cost averaging.  Bitcoin obviously has significant volatility but much less volatility over the course of a week or a month.  Making periodic even value purchases results in your buying more when price is low and less when it is high. You have less risk exposure than buying at a single point (i.e. buying at $11.30 yesterday and now having 5% less value).

If you are interested in us supplying a portion of your needs, further discussion would likely be better handled by PGP protected messages. There are details in the link above.

Thank you very much! I would like to buy for example $ 200,000 of Bitcoin in CASH!

Tangible Cryptography can facilitate large bulk sales of Bitcoins acquired from our other ventures.
https://bitcointalksearch.org/topic/bitcoins-direct-support-thread-87094

We accept cash deposit at our Bank Of America deposit account among other payment methods.    We can sell up to $5,000 in BTC with same day (usually 3-4 hours) delivery for a first time buyer.  Larger transactions are negotiable on case by case basis for repeat buyers.  A purchase of over 1000 BTC will likely require multiple days to fulfill (or advance notice with a price lock).  To limit our BTC exposure we generally don't go long more than 1,000 BTC.

Still as MD pointed out "large" is kinda vague.  One person might consider $1,000 "large" and someone else might not even consider $100,000 "large".

"Large" is relative.
You can buy up to $4,000 a day, per person, in the USA, Brazil, Ukraine, and Russia through www.bitinstant.com

That means each person can technically buy $1,460,000 worth of Bitcoins per year with cash without needing to show any sort of ID.

If you have one person in the USA, Russia and Brazil each depositing cash each day,   you could buy $4,380,000 worth of Bitcoins with cash each year.

Is this "large" enough for you?

Dears

How to buy large quantity of bitcoin in cash? Countries:

USA
Europe
Brazil
Bolivia

Thank you