How to document each step of a conversion

How to document each step of a conversion

1) Introduction — The shortest distance from wallet to deed is a straight documentary line

In today’s environment, institutions no longer “lean” on reputation; they rely on evidence. A seamless conversion requires a linear narrative with matching exhibits: where your crypto came from, which regulated counterparty converted it, how identity travelled with the funds, when euros landed in a local, resident company’s account, and how the notary validated the chain. If one exhibit is missing—or out of sequence—expect callbacks, holds, or even a file reset.

Three truths frame every successful conversion:

  • Identity must ride with every transfer. Under the EU “travel rule,” providers must transmit and verify originator/beneficiary data on qualifying transfers; from 30 December 2024, detect–reject/return has become the operational norm in the EU. If your identity payload is incomplete, banks will pause or return funds. Eur-Lex+1
  • Crypto counterparties must be MiCA-ready. From 30 December 2024, EU CASPs fall under MiCA, with a transitional window to 1 July 2026 for eligible incumbents. Paper proving authorisation or transitional status matters as much as the brand name. ESMA+1
  • Your books must echo future reporting. The OECD’s CARF and the EU’s DAC8 bring crypto into automatic exchange. Fields that platforms report from 2026 onward must match your internal ledger—timestamps, identifiers, gross proceeds—so your story is consistent across borders. OECD+1

Promise of value: you’ll leave with a practical blueprint—a Notary-Grade Funds-Mapping Memo template, leg-by-leg exhibit lists, and governance moves that convert digital performance into deed-ready euros under French civil law. Chez SBH Capital Partners, nous aidons nos clients à transformer leurs actifs numériques en patrimoine tangible.

2) Definition — What “documenting a conversion” actually means

To “document a conversion” is to create a coherent, verifiable narrative from the first cryptographic proof to the final notarial wire. Think less “folder of PDFs,” more case file a banker or notary can test in five minutes.

The documentary spine has six legs:

(A) Wallet provenance (before you move size).

  • On-chain analytics for source wallets: address graphs, risk screens, clustering where available; dated screenshots or reports.
  • Custody or self-custody proof: exchange/custodian statements or a signed wallet-control attestation with transaction hashes.
  • Acquisition evidence: exchange fills, OTC tickets, mining income records, vesting schedules—whatever first created the asset.

(B) Counterparty selection & MiCA status (who converts).

  • CASP/OTC letter confirming authorisation or transitional status under MiCA, with safeguarding wording and named compliance contacts.
  • Service scope: which services they provide (execution, custody, settlement), with legal entity identifiers and registered office.

(C) Trade execution (the conversion itself).

  • Deal ticket: pair, notional, price/rate, timestamp, venue/counterparty, execution method.
  • Settlement proof: transaction IDs on-chain for crypto legs; fiat settlement confirmations on the provider’s letterhead.

(D) Travel-rule payload (the identity that rides with funds).

  • Originator/beneficiary data embedded by the provider; logs and callback notes archived.
  • Remediation trail if a field was corrected (this is normal; the point is to show control). AMF

(E) Bank landing (clean euros, local account).

  • SWIFT MT confirmations (MT103/MT202 or bank-native equivalents).
  • KYC approval notice and account mandate showing signatories.
  • Reconciliation sheet tying provider settlement to net bank receipt.

(F) Notarial readiness (title transfer & AML).

  • Funds-Mapping Memo (3 pages max): wallet(s) → CASP/OTC → local company’s bank → notary escrow → deed.
  • Board resolution authorising the acquisition and payments.
  • Identity/KYC pack aligned with notarial AML duties under French law (the notary is a public officer bound by enhanced verification). Chambre de Paris

Why a local company matters: Holding the property via a single-asset, Saint-Barth company concentrates flows, keeps governance on island, and aligns with residency realities. Le modèle fiscal de Saint-Barthélemy permet une neutralité légale unique au monde. The gérance locale (local management) is what lets you evidence effective management for banking and tax purposes—La gérance locale garantit la résidence fiscale de la société et la conformité internationale.

Metaphor: Documentation is your regulatory passport. If it’s complete, you breeze through checkpoints. If not, you unpack your suitcase at every desk.

3) Stakes & problem patterns — Where conversions fail on paper (and how to spot the risk early)

1) Identity breaks en route (travel-rule gaps).
Funds leave a platform lacking mandatory originator/beneficiary fields. Post-2024, European providers must detect missing data and reject/return deficient transfers. Even if the money arrives, the receiving bank may quarantine it pending verification. Plan the payload before you press “send.” Eur-Lex

2) Counterparty is good—but the paper isn’t.
Your OTC desk is reputable, but you cannot obtain MiCA authorisation or transitional letters—only marketing PDFs. In 2025–2026, banks privilege evidence over reputation. If they cannot file your counterparty’s status, your ticket becomes high-touch. ESMA

3) Non-linear provenance.
There’s a gap between wallets, or an uncleared mixing episode years back. Without a chain-of-ownership narrative and risk analysis, the notary may ask you to re-evidence the early leg. Anticipate: isolate problem txids, add context (e.g., exchange hot wallets), and present a clean subset of coins for settlement.

4) Banking off-island.
Euros arrive in a non-local personal account, then hop to a different bank for the notary. Each hop creates extra AML work and weakens the on-island substance narrative. Use one local corporate account dedicated to the acquisition.

5) Ledger vs. reporting asymmetry.
From 2026, DAC8 pushes platforms to report crypto events into EU tax pipelines; the OECD CARF expands globally from 2027/2028. If your internal ledger omits fields that platforms will report (asset IDs, timestamps, gross proceeds, counterparties), authorities will query the mismatch. Build report-ready books now. Taxation and Customs Union+1

6) Personal title.
Paying suppliers and the notary personally blurs the file: mixed flows, privacy loss, succession headaches. A single-asset company keeps the audit trail clean and the lifestyle private. Ce type de montage n’est pas une évasion fiscale, mais une optimisation encadrée par le droit français.

What’s at risk? Delays (lost opportunities), pricing moves (you pay more tomorrow), reputational friction (banks mark your profile), and—worst—tax reclassification if your governance contradicts your claimed residency. Documentation is cheaper than remediation.

4) Solutions & strategies — A step-by-step blueprint with exhibits

Step 1 — Assemble the vehicle and seat management on island

  • Incorporate a single-asset company in Saint-Barth with registered office, local accounting, and local bank account.
  • Appoint a local manager (gérant) to chair meetings on island, sign resolutions, and instruct the bank—creating effective management facts.
  • Open the local account early; collect KYC confirmation and signatory proofs.

Step 2 — Pre-qualify your conversion rails

  • Select a MiCA-aligned CASP/OTC; obtain authorisation or transitional letters with safeguarding language and named compliance officers (PDF on letterhead).
  • Confirm travel-rule capabilities and data fields (originator name, account, identifiers; beneficiary details). Archive a travel-rule readiness note. ESMA+1

Step 3 — Prove wallet provenance

  • Create a wallet dossier: ownership attestation; on-chain reports showing risk score and transaction paths; exchange/custodian statements.
  • If any legacy taint appears (e.g., old mixer exposure), ring-fence coins and document why the settlement wallet is clean.

Step 4 — Execute the trade and collect deal paper

  • For each tranche: deal ticket (pair, notional, rate, timestamp, venue), settlement confirmation, and fee breakdown.
  • Capture on-chain txids for crypto outflows and bank settlement for fiat inflows to the provider.

Step 5 — Make identity travel and land euros locally

  • Send to the local corporate account—not personal—ensuring originator/beneficiary fields are complete before the transfer.
  • Archive travel-rule logs, any callback notes, and SWIFT MT103/MT202 confirmations.
  • Reconcile a one-page bridge: deal ticket → provider settlement → SWIFT receipt → bank ledger.

Step 6 — Prepare the Notary-Grade Funds-Mapping Memo

  • Three pages max; clear headings: Wallet(s) → CASP/OTC → AHC bank → Notary escrow → Deed.
  • Exhibits: chain analytics, custody/exchange statements, MiCA letters, OTC certificates (pair, size, timestamp, rate), travel-rule evidence, SWIFT MTs, board resolution authorising the purchase and escrow payment.
  • Share a digital data room with the notary: organised, labeled, and bilingual where helpful. French notaries carry statutory AML duties; a linear pack lets them satisfy obligations efficiently. Chambre de Paris

Step 7 — Align your books with DAC8/CARF fields

  • Mirror platform-reportable fields in your ledger: asset identifiers, tx timestamps, proceeds/cost, counterparty IDs.
  • Run quarterly self-reconciliations so what others will report already matches your books. Taxation and Customs Union+1

Metaphor: Treat the conversion like a yacht passage. The weather (markets) may change, but a disciplined crew (documents) keeps the course steady and the arrival on time.

5) The SBH Capital Partners Offer — We build the corridor and carry the file

Your time is valuable. Our job is to replace friction with format—the exact artifacts banks, notaries, and auditors use to say yes.

Company & governance (five-year horizon).
We incorporate a 100% client-owned Saint-Barth company with registered office, local accounting, and a local bank account. We act as gérant, chairing on-island meetings, keeping board calendars, minutes, and decision matrices that prove effective management. La gérance locale garantit la résidence fiscale de la société et la conformité internationale.