If someone were to sell bitcoins on localbitcoins.com in exchange for paypal my cash cards, which were then deposited into paypal. Is that legal as long as any taxable gains received in the transaction are paid? If the amount is under $500 per day and $4000 per month would there be any requirement to know the customer or comply with anti-money laundering laws?
it depends on which country you are transacting because each country has regulatory policies different laws regarding bitcoin, I think if you are transacting of bitcoin to localbitcoinc for cash card paypal you usually pay a fee transaction fee, usually in need ID verification for security process your transactions