Open the account months before the money moves, tell the bank what is coming and where it came from, and put the documentation on file while nothing is pending. My view is that the word seasoning is the problem, because it makes a disclosure exercise sound like a disguise. The version people actually ask me about, splitting a transfer so it draws less attention, is a federal felony under 31 U.S.C. § 5324.
Part of our guide: Wyoming Crypto LLC.
The short version
- A bank account is an underwriting relationship, and federal rules require the institution to understand “the nature and purpose” of it.
- Splitting a transfer to evade reporting is a felony, and it is separately an enumerated reason to file a suspicious activity report.
- The $10,000 report is a currency rule. A wire from an exchange is not currency and produces a different record entirely.
- Documentation on file beats documentation on demand, and the date on each one is part of what gets read.
- An entity account raises the bar. Beneficial ownership, the stated business purpose, and the tax return all have to agree.
Two things called seasoning
The word covers two practices that share nothing beyond a name.
The first is opening a real account, using it, and building a documented history before a large transfer arrives. That is ordinary prudence and it is the subject of the rest of this article.
The second is arranging deposits or account history so money looks smaller or better established than it is. That one is a crime, and it does not belong on a list of options.
“No person shall, for the purpose of evading the reporting requirements of section 5313(a) … (3) structure or assist in structuring, or attempt to structure or assist in structuring, any transaction with one or more domestic financial institutions.”
Read the intent clause, then read the word “attempt.” The offense is complete on the purpose plus the attempt. Nobody has to lose money and no threshold has to be crossed. It carries imprisonment for not more than 5 years, rising to not more than 10 where it forms part of a pattern of illegal activity involving more than $100,000 in a 12-month period.
The tactic also defeats itself. A transaction “designed to evade any requirements of this chapter or of any other regulations promulgated under the Bank Secrecy Act” is an enumerated reason for a bank to file a suspicious activity report once it involves at least $5,000 (31 CFR 1020.320). Splitting a transfer generates the report it was meant to avoid, attaches a criminal statute to the account holder, and leaves a credibility problem in a file that outlives the transaction.
The relationship is underwriting
Everything useful about the legitimate version follows from one observation: a bank account is underwriting, and underwriting rewards predictability. The rule says so directly. Banks must run risk-based procedures for ongoing customer due diligence, including:
“Understanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile.”
The institution builds that profile whether you participate or not. A large wire landing in an account with nothing behind it gives the monitoring system no baseline, so it reads as anomalous and a person has to construct an explanation from scratch. They will build it by asking you, under time pressure, while the funds sit unavailable.
An account that has run for months with a business purpose the bank already understands, filings it has already read, and a source-of-funds narrative sitting in the file gives that same system its comparison. The wire arrives as expected activity. Nothing has been disguised or softened. The entire benefit comes from having disclosed more, and earlier, than the moment strictly required.
Get the mechanics right too, because most people arrive holding the $10,000 figure and the wrong idea of what it attaches to. That report is a currency rule, covering transactions “in currency of more than $10,000” (31 CFR 1010.311) under 31 U.S.C. § 5313. A wire from an exchange is not currency. It creates a records obligation instead: for transmittals of $3,000 or more the institution retains the transmittor’s name and address, the amount, and the execution date (31 CFR 1010.410). Those obligations fire on their own rules. What you can influence is whether the discretionary review beside them has anything to work with.
The bank also has a supervisor to satisfy, and that relationship loosened in 2025. The FDIC rescinded its prior-notification requirement, confirming that supervised institutions “may engage in permissible crypto-related activities without receiving prior FDIC approval” (FIL-7-2025). Read that carefully before taking comfort from it. A federal gate came down, and no individual bank’s appetite changed as a result. Whether a particular institution will hold an account funded mainly by crypto is still its own policy question, and you want that answer in month one.
What belongs on file
The account, opened early and used. Payroll, vendors, ordinary transfers. A flat history with one enormous spike is a harder read than an account with a rhythm.
A source-of-funds package. How the assets were acquired, when, and through which venues: exchange statements, purchase records, transaction identifiers, and the tax treatment already reported. If assets moved into an entity from an individual, that contribution needs its own paperwork, because banks ask how ownership changed hands separately from where the money came from.
Entity documents. Formation filings, EIN, operating agreement, and the beneficial ownership certification required by 31 CFR 1010.230, naming both the owners above the 25 percent line and the individual who controls the company. The bank keeps that record until five years after the account closes, so treat it as a lasting description of the business. What a Wyoming digital asset LLC is determines what the bank ends up reading.
A written heads-up. Amount, expected date, originating institution, and purpose, sent to a named person before the transfer with the documents attached.
What I actually see
The formation, the account, and the wire all land inside about three weeks. I have watched that sequence more often than any other, and it puts the institution in an impossible spot: its entire knowledge of the customer is one application form, and the first real activity it ever sees is the largest number the account will ever carry. A hold at that point is the system working exactly as designed.
The heads-up goes to the wrong person. Someone mentions the incoming wire to a branch officer, feels covered, and nothing ever reaches the compliance file. The wire lands, the file is empty, and a recollection of a conversation carries no weight against a record that does not exist.
The paperwork tells three stories. Whoever completed the bank form wrote a plain-English description in a hurry, the operating agreement was drafted broadly so it would never need amending, and the return carries whatever activity code the preparer picked. No single document is wrong. Together they read as an applicant whose answer shifts with the audience, and in my experience that is the version that ends in a closed account rather than a delay.
The check I would run before any large transfer. Lay four things side by side: the account application’s description of the business, the purpose clause in the operating agreement, the business activity on the last tax return, and the paragraph you plan to send the bank. Read all four as a stranger would, with no context and no goodwill. If any two describe different businesses, fix the documents before the money moves. It takes an afternoon and it is the most useful afternoon in this process.
Where this goes wrong
The damage almost always comes from timing rather than from anything anyone said.
Accounts opened days before the transfer. Source-of-funds documents assembled after the hold, so every one carries a date later than the question that prompted it. Entity paperwork describing three different businesses. A transfer sent from an exchange account in an individual’s name into an account titled to an entity, with nothing on file explaining the change of hands. Personal and entity money running through one account, which erodes the separation the entity exists to create. And the worst version, someone who reads about reporting thresholds, sends the money in pieces, and commits the offense while trying to avoid attention.
The decision rule
- Open the account long before you need it, and use it for ordinary activity so a baseline exists.
- Ask the institution directly whether it holds accounts funded mainly by crypto, and get that answer from compliance rather than from a salesperson.
- Assemble source-of-funds documentation first, so every document predates any pending transfer.
- Reconcile the entity’s filings until the account application, the operating agreement, and the tax return describe one business.
- Put the beneficial ownership certification on file, and update it when ownership or control changes.
- Notify the bank in writing before the transfer, naming the amount, the date, the originating institution, and the purpose.
- Send it as a single transfer. Where a venue’s own withdrawal limit makes that impossible, record that constraint in writing before anything moves.
- Answer any review from the documents already on file, and add nothing you have not verified.
If the institution says it cannot hold the relationship, that is useful information arriving early, and the next step is a different bank rather than a smaller transfer. Banks that serve digital-asset businesses exist, and finding one takes weeks, which is exactly why this starts months ahead of the money.
Where this sits
Most of this work belongs to the entity rather than to the bank. Whether an LLC should hold the assets at all comes first, the Wyoming LLC hub collects the formation questions behind it, and custody arrangements for an entity produce the statements a source-of-funds file is built from.
These questions also cross professional boundaries, and the failure specific to this one is timing rather than competence. An attorney’s engagement tends to end at formation, a CPA appears at the first filing deadline, and a custodian arrives once there is something to hold. The banking relationship needs attention in the months between those events, which is exactly the stretch when nobody is retained. Decide early who owns that part of the calendar, because a file assembled by whoever happened to be free is the file a reviewer eventually reads.
Sources
- 31 U.S.C. § 5324, Structuring transactions to evade reporting requirement prohibited
- 31 CFR 1020.210, Anti-money laundering program requirements for banks
- 31 CFR 1020.320, Reports by banks of suspicious transactions
- 31 CFR 1010.311, Filing obligations for reports of transactions in currency
- 31 CFR 1010.410, Records to be made and retained by financial institutions
- 31 CFR 1010.230, Beneficial ownership requirements for legal entity customers
- FDIC, FIL-7-2025, clarifying that banks may engage in permissible crypto-related activities without prior approval
Related
- What is a Wyoming digital asset LLC?
- Should I put my crypto in a Wyoming LLC?
- How to transfer crypto into an LLC
- Crypto custody for LLCs
- Common crypto tax record mistakes
- Crypto banking and exchange
Last updated: 3 August 2026.
This article is general education, not legal, tax, or investment advice. Structuring is a criminal offense, and nothing here is guidance on reporting thresholds; preparation and disclosure reduce certain risks in a bank review but do not eliminate them. Talk to a qualified attorney and CPA about your own situation.
