Your bank asked for source of funds on a crypto sale: how to respond
A UAE bank requesting source of funds after a crypto sale wants documented proof connecting three points: where the crypto came from, where you sold it, and how the cash reached your account. Reply within the stated deadline with official statements, not screenshots, keep the file to one clear trail, and avoid vague explanations that trigger a longer review.
KEY FACTS
| Regulator | CBUAE sets banks' AML/CFT duties; VARA licenses the crypto side of the trade |
|---|---|
| Common trigger | An inbound wire linked to a crypto sale, above the bank's own review threshold |
| Core evidence requested | Trade confirmation, exchange or OTC statement, own-name bank statement |
| Response deadline | Set by the bank's own letter — no single UAE-wide day count is published; read the date on yours |
| Escalation path | Temporary hold → restricted account → closure, for a late or incomplete file |
Source: CBUAE AML/CFT rulebook; FATF Recommendation 16, as of September 2026.
Why did my bank ask for source of funds after a crypto sale?
A UAE bank asks for source of funds after a crypto sale because the Central Bank of the UAE (CBUAE) requires banks to understand the origin of unusual or high-value inbound transfers under its anti-money-laundering rules. A wire that follows a crypto-to-fiat conversion fits a pattern banks are trained to flag, whatever the sale route. If you already hold a source-of-funds file for crypto from the desk that executed the sale, most of the request is already assembled.
Crypto-linked inflows draw more scrutiny than an ordinary salary credit because international standards treat the sector as higher risk than traditional payments. A first-time six-figure credit is more likely to trigger a request than a small, repeated one — our guide on why UAE banks flag crypto-linked inflows sets out the size and pattern triggers banks watch. Either way, the request is a routine compliance step, not an accusation.
What exactly does the bank want to see?
The bank's request for source of funds on a crypto sale is asking you to prove three connected points: where the crypto came from, where and how you sold it, and how the cash reached your account. A reviewer traces the money hop by hop, and a gap at any hop is what stalls a file, not the crypto itself.
In practice this means a trade confirmation showing the amount, date and counterparty; an exchange or OTC statement covering the months before the sale; and a bank statement showing the fiat side landing in your own name. A confirmation citing a licensed desk's licence number gives a reviewer something they can check independently rather than take on trust.
How do you structure the response file?
Structuring the response file follows the same four steps whether the amount is modest or falls under enhanced due diligence for a larger conversion. Assemble the documents in the order the reviewer will read them.
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STEP 1
Start with the trade record
Get the trade or settlement confirmation from the exchange or desk that executed the sale, showing the amount, date and counterparty — the same confirmation listed in a desk's onboarding checklist.
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STEP 2
Match the wallet trail
Add the on-chain transaction or wallet statement connecting the crypto's origin to the sale. Sales under enhanced due diligence for large crypto conversions need this hop documented in more detail.
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STEP 3
Attach the bank leg
Include the bank statement showing the fiat proceeds landing in an account in your own name — a licensed desk settles only to own-name accounts, and your bank expects the same.
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STEP 4
Write a one-page cover note
Summarise the chain in plain dates and amounts so the reviewer does not have to reconstruct it. One page matching the attachments clears faster than a folder with no index.
If you no longer hold the original confirmation, ask the desk that executed the sale to reissue it — for trades with IWGT, you can request a reissued confirmation through the same channel you used to trade.
How long do you have to respond, and what happens if you miss it?
The response window a UAE bank gives for a source-of-funds request is set out in the bank's own letter, and it varies by bank and transfer size. CBUAE's anti-money-laundering rules require risk-based monitoring, but no single deadline applies to every bank.
Missing the deadline, not the transaction itself, is what moves a case from review to restriction, as the table below shows.
| Stage | What it means | What reverses it |
|---|---|---|
| Under review (temporary hold) | The bank pauses the incoming credit while it waits for your documents | A complete file submitted before the stated deadline |
| Restricted account | Some or all debits and credits are blocked while compliance investigates further | Full compliance sign-off, which typically takes longer once restrictions are already in place |
| Closure notice | The bank ends the relationship and returns the balance by cheque or transfer | Rarely reversible — the practical step is opening a new account elsewhere with the file ready in advance |
Every stage is easier to avoid than to reverse, which is why avoiding a bank account freeze starts at the first letter, not the second.
What mistakes turn a routine request into a freeze or closure?
The mistakes that turn a routine source-of-funds request into a freeze or closure repeat across most cases, and none involve the crypto being illegitimate — they involve how the answer was put together.
- Missing the deadline, or replying "I'll send it later" instead of a partial file plus a completion date.
- Sending exchange screenshots instead of an official statement export.
- Proceeds landing in, or documents naming, an account that is not in your own name.
- A vague explanation such as "savings" or "trading" with no supporting record.
- Leaving out an awkward segment of history instead of disclosing it upfront.
What happens after you submit the file?
Once you submit a complete source-of-funds file, the bank's compliance team reviews it against the pattern that triggered the request, and most straightforward cases clear within the bank's normal review cycle. A reviewer sometimes comes back with one follow-up question rather than rejecting the file outright.
If the account was already restricted before you replied, service typically resumes only after compliance formally signs off, which takes longer than the original request window. In the small share of cases where a bank still closes the account, the balance is returned by cheque or transfer, and the same file works for opening a new relationship elsewhere.
FAQ
What happens if I ignore my bank's source-of-funds request?
The account typically moves from a temporary hold to a formal restriction, and silence is a common path to closure. A partial reply with a completion date beats none.
Can I send an exchange screenshot instead of an official statement?
No. Banks want an official statement export — a PDF or CSV with your name and transaction history — not a screenshot, which cannot be verified.
Does trading through a licensed OTC desk remove my bank's source-of-funds check?
No. A licensed desk reviews source of funds before trading with you, and the bank still runs its own anti-money-laundering check when the wire lands. A clean, own-name settlement just makes that check faster.
What if part of my crypto history cannot be documented?
Say so in the cover note rather than leaving a gap unexplained. A bank can sometimes accept one undocumented segment if the rest is clean, but funds from mixers or anonymous P2P trades are usually declined.
Will my account return to normal once I submit the documents?
In most cases, yes, once compliance signs off. If the account was already restricted, sign-off takes longer than the original response window.
Selling through a bank-settled desk keeps the trail clean
IWGT is a VARA-licensed Broker-Dealer in Dubai (licence VL/24/12/002). Every trade settles to your own-name bank account with a confirmation your bank can verify, so a source-of-funds request is one document shorter to answer.
SOURCES
- Central Bank of the UAE — AML/CFT, accessed 17 September 2026.
- FATF — The FATF Recommendations (Recommendation 16, the Travel Rule), accessed 17 September 2026.
- IWGT published onboarding requirements — IWGT onboarding checklist, September 2026.
This guide is informational and is not legal, tax or investment advice, nor an invitation to buy or sell any virtual asset. Rules and figures are as of September 2026 — re-check the sources before acting. Virtual assets may lose their value in full or in part and are subject to extreme volatility.