An alleged argument over a reluctant face-to-face bitcoin trade led to a shot being fired in a central Milwaukee apartment, according to news reports. 28 year-old Jonathan Royce of Montana and convicted felon in North Dakota, was arrested shortly after.
Royce appeared in court on January 4th and again on the 10th, charged with second degree recklessly endangering safety and use of a dangerous weapon. FOX6 reported cash bond was set at $2,000 and Royce will reappear for a scheduling conference on January 24th.
Single Shot Fired After Trader Changed Mind
Milwaukee’s WISN reported the incident happened when a group of men gathered in a local apartment to negotiate a “sale of BitCoin”. Royce decided not to complete the sale and an argument ensued between him and another man known as “Dallas”.
According to a witness, Royce pulled a silver handgun and pointed it at Dallas, after the latter urged him to make the trade. Shortly after a shot was fired — police found a bullet strike in the apartment’s stove vent and a bullet in the floor underneath it.
As a convicted felon, Royce faces the possibility of tougher treatment — under Wisconsin’s 1981 gun regulations, anyone convicted of a felony may not own or carry a gun in the state, even for hunting.
The incident highlights some of the pitfalls involved in face-to-face bitcoin and cryptocurrency trades, especially in private locations. Last November, another bitcoin P2P trader suffered an attempted knife mugging in a Tokyo hotel room.
Perils of P2P or In-Person Bitcoin Trading
In-person trading is becoming more popular as governments increase identity requirements for cryptocurrency exchanges, in an attempt to prevent money laundering, tax evasion and large private transactions in general, whether they’re illegal or not.
The recent bitcoin price surge has likely piqued more curiosity among would-be traders and criminals alike, however in-person trades have always been risky. For years now, traders on platforms like LocalBitcoins, Craigslist and chat groups have shared tips on how to mitigate the various risks and dangers.
P2P traders usually avoid apartments in hotel rooms, though performing four and five figure cash transactions in cafes and crowded places also arouses suspicion and creates additional danger from third-party witnesses. Most would recommend small trades only, but there’s always the temptation to go for a large payday if the opportunity is there. With the increased percentage commission comes increased risk.
It isn’t just physical safety and robbery, though — traders have described problems with PayPal and bank transfers that were later reversed, counterfeit cash, and other payment scams.
And there’s also risk from law enforcement itself. In many jurisdictions, exchanging currencies officially counts as “money services” (or money transmission) and requires a license and/or KYC procedures for all participants. It may even be outright illegal. There have been periodic stories of bitcoin traders being arrested for money laundering, most notably in Florida.
Have you ever traded bitcoin in person? How do you keep things honest and safe? Feel free to share your thoughts in the comments.
Images via Milwaukee Police, Pixabay