There's an old saying, "Pigs get fat on bitcoin, but too much bitcoin and you'll become a fat hog. Fat hogs get slaughtered."
In other words, don't get greedy;
1. Pay your taxes.
2. Check your state laws. Florida's limit is $300. Other states are usually $1000. Do not change more than these amounts with the same person in the same day.
https://www.ffiec.gov/bsa_aml_infobase/documents/FDIC_DOCs/BSA_Manual.pdf3. Do not deposit or withdraw more than $10,000 cash from your bank.
http://en.wikipedia.org/wiki/Currency_transaction_report4. If your customer says he wants to do something illegal with the BTC, refuse to do business with him. Remember, money laundering is obfuscating the source of the money which was illegal. The 2 men arrested in Florida was told by their customer that they wanted to use the bitcoin to buy stolen credit cards.
ests-may-be-first-state-prosecution.html]http://www.bloomberg.com/news/2014-02-09/miami-[Suspicious link removed]ests-may-be-first-state-prosecution.html5. Do the transaction in a bank so that you won't get robbed and the bank tellers can tell you if the fiat are real or fake.
If you break these rules because you're greedy, then you only have yourself to blame. Don't be greedy!
I've noticed that I can buy bitcoins at market rate on coinbase.com and then resell them on localbitcoins.com for plus 12% of market value. Obviously, there is a little work involved. Dealing with numerous emails, small transactions, etc, and the potential for fraud.
However, it's not a lot of work, mainly just pushing the escrow release button 4-5 times a day after verifying deposits into my bank account.
Since I can sell around $1200 in coin per day, minus 1 percent for localbitcoins and 1 percent for coinbase, I can net about $120 per day, which is currently more than my day job.
Now, if something seems too good to be true, it generally is. In other words, the profits seem too easy for the work involved, that I worry that I'm missing something? I would think that the ease of profit would encourage more people do to it, thus making more competitive prices on localbitcoins and driving the price down.
What am I missing?
Will the feds eventually bust down my door for being a money changing business without a license?
Will my bank eventually notice that I'm selling bitcoins and suspend my bank account?
Will the IRS notice what I'm doing and charge me with tax evasion if I don't report my profits at year's end?
Will I eventually get scammed somehow from a buyer, thus slashing my profits?
Will something else unforeseen happen to dissolve all profits?