What’s the safest way to cash out a large amount of cryptocurrency?

How large are we talking here. Large for you could be $25,000 and it would be a relatively small amount for other players.

Let’s assume large is a couple of million US Dollars. Anything less can easily be cashed out to your bank account. I would personally never straight cash out cryptocurrency, by transferring it to someone’s wallet and accepting cash. That would be questioned a lot by the authorities once you start using your money (origination of funds / source of funds would be impossible to prove). Besides you would have NO way of knowing/checking if the cash being given out to you is tainted or stained in any way.

If by cashing out, a large amount means, taking your cryptocurrency holdings and selling them and then taking the money into your bank account, there are many ways to do it - depending on how big the amount it.

If you’re you US$ 100+ Million, you already know the answer. Chances are you have access to the right people (bankers, lawyers, deal makers) who can facilitate it. People who can make this happen for you, once you announce your intention.

If you’re multi-million US Dollar crypto holder, then the next best thing is to test a few licensed exchanges out and convert the proceeds directly into your bank account.

Be prepared to first check with your bank if they will accept the incoming transfer, as the gains would be coming from cryptocurrency and the source of funds (as to how the crypto funds were obtained, would need to declared and accepted by the bank).

This is precisely an area where many people run into trouble. A bank may not knowingly receive and credit your bank account with US$ 30,000 worth of crypto currency related sale proceeds, but US$ 3 Million, I highly doubt it.

Most HNWIs that I know who did clear out multi-million dollar sales proceeds almost all of them used their Private Banking channels, i.e. they were already subscribing to Private Banking from various banks (depending on where they were, US, UK, Canada, EU Zone, Switzerland, Singapore, Japan, HK, etc.) and the private bank then arranges for formal delivery channel as to how the money can be received safely. It is after all in their best of interest to audit your money and provide an off-ramp from the crypto world to channel the money as a demand deposit in their bank. If the amount is multi-million and you want to have a safe place to keep in, find out in your area who is providing Private Banking / Wealth Management Banking for Individuals and seek them out. They are highly cognizant of the crypto millionaires and the problems they are facing and hence provide (for a fee of course) all the services you needs to slide your cash pallet down from the crypto world into their bank.