Short, practical checklist for peer-to-peer (P2P) traders who buy/sell crypto for customers. Not legal advice — consult an attorney for your state/business.
Big picture — what most states and federal rules expect
- MSB Registration: If you operate as a Money Services Business (MSB), you must register with FinCEN (Form 107). Registration is required within 180 days of starting and renewed every 2 years. Put your renewel date on the calendar, as Fincen will not alert you when you need to renew like they should.
- Cash transaction reporting: Large cash transactions ($10,000+) require a report (Fincen Form CTRX). File within 15 days.
- Suspicious Activity Reports (SARs): File Fincen form SARX when transactions look criminal, suspicious, or fit red flags. Usually within 30 days. If the activity is illegal or violates your AML policy, ban the customer after filing the SARX.
- State licenses: Some states require a Money Transmitter License (MTL). Check with your state government.
Minimum compliance checklist
- Decide if you are an MSB under federal rules. If yes, register with FinCEN.
- Check state money transmitter licensing for each state you operate in.
- Write a basic AML program: policies, recordkeeping, staff training, compliance contact.
- Set up recordkeeping: IDs, logs, receipts for 5 years.
Reporting & thresholds
- Form CTRX $10,000+ received in trade/business → file within 15 days.
- CTR/BSA rules: MSBs report cash transactions above thresholds.
- SARX: File promptly when suspicious — structuring, scams, mismatched IDs.
Exams, audits, enforcement
Regulators (FinCEN, IRS, state agencies) can examine MSBs. Keep documentation and cooperate.
Operational best practices
- Collect ID for higher-risk trades.
- Keep a written risk-based threshold policy (e.g., ID above $1000).
- Keep receipts, logs, communications for 5 years.
- Document SAR decisions.