When Ordinary Crypto Sales Turn Criminal: Swiss Authorities Targeting the Wrong Targets

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A Swiss Entrepreneur's Ordeal Shows How Prosecutors Are Misapplying Fraud and Money Laundering Laws to Legitimate P2P Traders

A Swiss citizen and seasoned entrepreneur now faces serious fraud and money laundering charges in two different cantons, for nothing more than selling his own stablecoins through a fully regulated peer-to-peer marketplace. His experience lays bare a serious misalignment between the mechanics of digital finance and the current approach of some Swiss prosecutors.

The Classic Setup: A Normal Sale, an Extreme Reaction

Consider selling your second-hand car on a trusted online platform. The buyer pays from their bank account, you hand over the vehicle, transaction complete. Later you learn the buyer's money originated from a fraud victim, someone deceived by a scammer pretending to be a famous personality. You never met the victim, never spoke to them, had no suspicion whatsoever.

Replace the car with Tether (USDT) stablecoins and the platform with Binance P2P. That is precisely what happened to this Swiss entrepreneur: he sold his own cryptocurrency, received payment in Swiss francs, released the tokens via escrow, and was subsequently arrested, detained, charged with fraud and money laundering, had all his bank accounts closed across Switzerland, watched his businesses collapse, and saw his professional reputation, built over many years as an economist and entrepreneur, destroyed.

How Binance P2P Trading Really Operates

Understanding the case requires understanding the platform's safeguards. Binance P2P is among the most heavily regulated peer-to-peer crypto marketplaces worldwide. The process is tightly structured:

• The seller deposits their own crypto into the platform's escrow and posts a sell offer with a clear rate.
• The buyer, having completed full KYC identity verification, confirms the order.
• The buyer's fiat (for example Swiss francs) is transferred directly to the seller's designated bank account.
• Once the seller verifies receipt of funds, the platform releases the locked cryptocurrency to the buyer's wallet.

Importantly: seller and buyer have virtually no direct communication beyond trade confirmation details. The seller has no visibility into the origin of the buyer's fiat. The seller has no control over what the buyer does with the crypto afterward. Escrow exists to guarantee performance by both parties and to minimize fraud risk.

What the Prosecutors Decided to Do

In this instance, a scam victim was tricked by an impersonator posing as a celebrity into sending money. Those funds, after moving through several hands, reached a Binance P2P buyer who used them to purchase USDT from the accused entrepreneur. He released his own tokens from escrow after confirming payment, exactly following platform rules.

Yet prosecutors in two Swiss cantons brought charges: one canton for fraud (art. 146 Swiss Criminal Code), the other for money laundering (art. 305bis Swiss Criminal Code). The core reasoning in both appears to be the same: because the seller eventually received money traceable to a fraud victim, he must be complicit.

This line of reasoning is not only incorrect, it is actively harmful.

Why This Interpretation Collapses Under Swiss Law

Swiss criminal law rests on a cornerstone principle: no punishment without personal fault (Schuld). Fraud under art. 146 demands deliberate deception of another person. Money laundering under art. 305bis requires that the accused knew or should have suspected the criminal origin of the assets and then took steps to conceal or disguise that origin.

None of those elements exists here. The accused never contacted the fraud victim, never made any misrepresentation, never attempted to hide the source of funds, the payment arrived openly and transparently in his bank account from a fully KYC'd Binance user. He simply sold his personally held digital assets in an ordinary commercial exchange. There is no deception, no concealment, and crucially no criminal intent (Vorsatz).

The prosecutors appear to have traced the money trail backward without grasping how modern P2P crypto markets function. In traditional banking a direct transfer might reasonably suggest a relationship; in regulated P2P environments the escrow intermediary breaks that presumed link, leaving the seller blind to upstream fund sources.

The Heavy Price Paid by the Innocent

The human and economic damage has been severe. The entrepreneur was arrested and held in pre-trial detention. Every Swiss bank closed his personal and business accounts, effectively cutting him off from the financial system. His companies suffered irreversible harm. His decades-long professional standing evaporated.

All of this occurred before any court judgment, purely on the strength of the prosecutors' accusations. In a legal order that officially presumes innocence until proven guilty, the presumption proved meaningless once charges were filed.

The accused immediately sought to cooperate: he offered to travel to Switzerland, supply full documentation, and explain every aspect of the transactions. Detailed written submissions were sent in April 2025, August 2025, and November 2025 clearly describing Binance P2P mechanics. The prosecutions moved forward anyway.

The Dangerous Precedent This Creates

Should these cases succeed, the implication is stark: any individual selling cryptocurrency on a regulated P2P platform risks criminal liability whenever a buyer's funds are later traced to crime, regardless of the seller's complete lack of knowledge, involvement, or means of detection.

The same logic would criminalize a grocery cashier who accepts payment later revealed to be stolen cash, or a landlord who receives rent from embezzled income. The reductio ad absurdum exposes the fundamental injustice.

Swiss law does provide for compensation after wrongful prosecution (art. 429 Swiss Code of Criminal Procedure), covering financial losses, legal costs, and non-material harm. But monetary awards years later cannot resurrect destroyed businesses, restore closed bank accounts, or repair obliterated reputations.

The more pressing question remains: why were these proceedings initiated in the first place?

Three Changes Switzerland Urgently Needs

This matter reveals three critical areas for improvement:

1. Prosecutorial training on digital assets, Prosecutors dealing with crypto cases must understand P2P escrow systems, platform verification processes, and the actual visibility limits of blockchain transactions. Tracing funds without context produces miscarriages of justice.
2. Proportionality before devastation, Arrests, account freezes, and criminal charges should not precede credible evidence of intent or participation. Financial-flow analysis alone is insufficient justification for upending lives.
3. Real accountability for prosecutorial errors, Beyond eventual compensation, there must be stronger institutional mechanisms to prevent recurrence when charges lack solid foundation. An acquittal after years of ruin is no remedy.

Closing Reflection

Switzerland has long positioned itself as a global leader in rule of law, financial innovation, and balanced justice. A nation that hosts one of the world's most sophisticated financial centres should be able to distinguish between genuine offenders and ordinary participants acting lawfully in digital markets.

If it cannot, or will not, the signal sent to every crypto holder, every fintech founder, and every participant in the digital economy is unmistakable: in Switzerland, selling your own cryptocurrency on a regulated platform can destroy your entire life.

This article is based on active criminal proceedings in multiple Swiss cantons. Identifying details are omitted to respect ongoing legal processes. The accused asserts his complete innocence and continues to pursue every available legal avenue.

About the issue: This piece examines the collision between cryptocurrency peer-to-peer trading mechanics and Swiss criminal prosecution, highlighting the severe risks innocent sellers face when investigative authorities misunderstand regulated digital marketplaces.

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