I use exchange websites to withdraw my bitcoins for fiat to my bank account. I wish to know that if in case the bank asks about the source of the income and source of bitcoins, what would I proof can I give them? I commonly earn from signature campaigns, freelance tasks and translations but giving them the complete details would be too much.
Has anyone ever provided proof or their source of bitcoins to any bank or legal organization? What would be the best way to prove it?
I know the feeling mate. I have the same experience too I think about December last year. I just don't know how it was triggered because I used our exchanges here for years. Maybe Im doing a weekly withdrawals of the amount I can consider as not that small. I told them everything about some various method Im doing. Their response after that is not related anymore to the source of my bitcoin but they just suggest me to resubmit my ID verification and until now no such things like that ever happened again. I think this is just applied to bank withdrawals since other options are fine.
As you mentioned above, I see no problem if you will tell them about trades as it was not illegal as you are using a reputable exchanges.