How to Avoid Account Freezing Due to Crypto Transactions

Crypto transactions are increasingly attracting the attention of banks due to money laundering risks and the specific nature of crypto-related payments. As a result, users may face account blocks—even when their activity is completely legal. In this post, we’ll break down how to minimize the risks and avoid such situations.

Why do banks block accounts?
Banks monitor client transactions in accordance with anti-money laundering (AML) and counter-terrorist financing (CTF) legislation.
🔎 A key role is played by the Bank of Russia’s “Know Your Customer” (KYC) platform, which assesses the risk level of legal entities and individual entrepreneurs (IEs).
✖️ Being flagged in the system's “red” risk category can result in automatic account blocking.
🙎‍♂️ Individuals are also under close scrutiny, especially if:

• The number of counterparties exceeds 20–30 per day.
• Transactions are linked to P2P platforms and crypto exchanges.
• Payments come from persons suspected of using “drop” accounts (i.e., accounts used by money mules).

How to reduce the risk of being blocked
✔️ Work with reputable crypto exchanges – choose platforms that require KYC verification and operate legally.
✔️ Use your personal bank cards – don’t share your banking details with others to avoid being identified as a drop account.
✔️ Respect transaction limits and maintain consistent patterns – frequent transfers from various people can raise suspicions.
✔️ Use your bank cards for everyday needs in addition to crypto-related transactions.
✔️ Keep documents confirming the source of funds – account statements, transaction screenshots, and exchange addresses can help prove the legality of your transactions.
✔️ Respond to bank inquiries – if your activity is questioned, it’s best to provide explanations and supporting documents promptly.
✔️ Avoid using unverified P2P services – it’s safer to deal with reliable platforms and counterparties to avoid suspicious transactions.

What to do if your account is blocked
1️⃣ Contact your bank – ask for the reason for the block and what documents are required to resolve the issue.
2️⃣ Gather proof of the legality of your transactions – such as contracts, invoices, and exchange account statements.
3️⃣ File a complaint with the interdepartmental commission – if the bank refuses to unblock your account, you can challenge the decision.

Conclusion
Account blocking due to crypto transactions is a real risk, but it can be minimized by staying cautious and following legal requirements. Transparency with your bank, using legal services, and having documentation to back your transactions will help you avoid problems.