Source of Funds vs Source of Wealth: What Is Being Checked

The flat seller was asked about that one deposit; his payslips describe what he normally earns. The deposit itself came from the sale.

Binance's help-centre guide to the two terms uses nearly the same case to draw the line. In its words: “you are wealthy because of your career, but this specific deposit or funding came from a one-time house sale”.

Two questions that sound like one

The guide, titled Guide to Verifying Source of Wealth and Source of Funds, defines them separately:

Source of Wealth (SoW) — The “Big Picture”: This describes how you built your total net worth over your lifetime.

Source of Funds (SoF) — The “Specific Deposit”: This refers to the origin of the specific fiat money or crypto funds you are depositing into your Binance account.

Laid side by side:

The same page also warns that “Source of Funds should not be mistaken with your regular ‘income’”. A deposit might come out of salary or a pension, or it might be an inheritance or an insurance payout that has nothing to do with your job.

People who have not deposited anything can still be asked. For them the guide says to “declare the activities you will use to accumulate the funds that you plan to deposit in the future.”

Why you are being asked now

Money-laundering rules name situations in which a firm is expected to dig further. Which rulebook a given platform follows depends on where it is licensed, and implementations differ, but the UK's Money Laundering Regulations 2017 set these situations out plainly enough to show the logic. Three of the four below name source of funds outright; the second asks only about a transaction's background and purpose (quoted from the consolidated text on legislation.gov.uk):

• Routine monitoring. Regulation 28(11)(a) requires “scrutiny of transactions undertaken throughout the course of the relationship (including, where necessary, the source of funds) to ensure that the transactions are consistent with the relevant person's knowledge of the customer, the customer's business and risk profile”.
• Transactions that look out of pattern. Regulation 33(1)(f) triggers enhanced due diligence where “a transaction is unusually complex or unusually large in each case given the nature of the transaction”, where “there is an unusual pattern of transactions”, or where there is “no apparent economic or legal purpose”. Regulation 33(4)(a) then asks the firm, “as far as reasonably possible”, to examine “the background and purpose of the transaction”. That paragraph does not mention source of funds; listing it here is our own grouping.
• A link to a high-risk country. For customers established in a country on the FATF call-for-action list, regulation 33(3A)(c) makes the firm obtain “information on the source of funds and source of wealth of the customer and of the customer's beneficial owner”. For an individual, “established in” means “being resident in that country, but not merely having been born in that country”.
• Politically exposed persons. Regulation 35(5)(b) requires “adequate measures to establish the source of wealth and source of funds” for a PEP, and the same regulation covers family members (spouse or civil partner, children and their spouses or civil partners, parents). Middle-ranking and more junior officials are excluded from the definition.

For most readers the first bullet is the relevant one. What follows is our inference, not the regulation's wording: the occupation, income and wealth you declared are the firm's “knowledge of the customer”, and a deposit that does not fit that picture (a large sum landing in an account that declared a modest income, say) is exactly the case where “where necessary” applies. Which is why the same amount can trigger a request for one person and pass unremarked for another.

The EU directive's enhanced due diligence article is quoted in our piece on why verification comes in tiers, together with the platform terms on what happens if you refuse or delay.

From the sale contract to the deposit

The guide's document table is long. It is organised by where the money came from: business income, employment income, crypto investments, financial investments, passive income such as rent and dividends, sale of real estate or other assets, loans, inheritance and donation, social benefits and family support, gambling and lottery, and “Other”. (Read on 15 September 2026; the categories and requirements are whatever the page shows when you submit.)

Several rows join two documents with a capital AND. A sale of real estate needs a sales contract or settlement AND a bank statement showing the proceeds. A personal loan needs a loan contract or affidavit AND a bank statement showing the deposit. Gifts and family support work the same way: a signed declaration, plus the bank statement where the money arrived.

In each pair, one document shows how the money came to exist and the other shows it landing in a bank account; name, date and amount join the two. Think of it as a chain. Back to the flat:

1. the sales contract: who sold to whom, for how much, and when ownership passed;
2. a bank statement: the day the proceeds reached an account in your name;
3. the transfer from that account to the exchange, matching the deposit you are being asked about.

The first two links come straight from the guide's “Investment income - Sale of real estate or other assets” row. The third is our addition, not a listed requirement: money rarely goes from a buyer straight onto an exchange, and if that middle step is missing, the first two documents do not connect to the deposit in question.

When any link has a name, date or amount that does not match, the reviewer has to stop and guess. The guide's “Golden Rules” are all about keeping the chain checkable:

• “Documents must match the name on your account.”
• Full name, issuer logo and date of issue clearly shown; “High resolution (300 DPI) is required. Ensure all four corners of the document are visible. Do not crop, blur, or use filters.”
• “Only non-editable formats (PDF, JPG, PNG) are acceptable. Excel or Word documents are generally rejected.”
• Recent; the page's examples are “payslips from the last 3 months, or tax filings for the most recent year”.
• “Screenshots are accepted only if they show the full page including the URL with your or your company's name and the date.”

One line in the “Other” row works as a general test for every category: documents should “preferably be issued or verified by an independent third party (e.g. a bank, employer, accountant, lawyer, or government authority)”. It is the same principle behind what a proof of address actually proves: what counts is who made the record.

When the money started out as crypto

The hardest chain to build is one whose first link is already on a blockchain: coins bought years ago, mining payouts, assets moved in from another platform. The guide's crypto-investment row lists several document types, and each comes with a condition that ties it to something else.

• Crypto account statement: must “Display your Unique Account ID (UID) and verified email address” and identify the exchange or provider.
• Crypto wallet screenshots: wallet address and holdings, and they must “Be consistent with any exchange statements, blockchain records, or tax documents provided.”
• Bank statement: covering the period when the crypto was sold, and showing “the deposit received from a crypto exchange or wallet”.
• Signed letter by a certified professional: from a financial advisor, accountant or tax professional, explaining “the nature of the crypto investments, the original source of capital used, and the approximate profit realised”.

Even a professional's letter has to name “the original source of capital used”. We read that as saying the coins themselves are not accepted as the start of the chain; it has to reach back to the money that bought them.

That earliest link is the one most likely to be broken. The platform you used years ago may have closed your account, or the email you signed up with may be long gone. Either way, the statement you need can no longer be downloaded. If you still have working logins to old accounts, exporting a full transaction history now is far easier than hunting for it after a request arrives.

Before you reply, write it down in two or three sentences

First check where the request came from. Respond only to a request you can see inside the platform’s app, or on its website after logging in, and ignore upload links that arrive by email, text or direct message. What happens when identity and financial documents end up with someone outside the platform is covered in why “guaranteed verification” services are always a trap.

1. Work out which question you were asked. A source-of-funds request is about that deposit. A source-of-wealth request is about how you came to hold what you hold. If it asks for both, answer them separately.
2. Write the story in two or three sentences. For example: “This money comes from the sale of a flat in 2025. The proceeds went into my current account at [bank], and I moved them to the exchange in two transfers.” The sentence that is hard to write is usually the link with no document behind it.
3. Put a document under each sentence. Prefer records made by a third party, such as a bank, employer, tax authority or notary, in the same name as the account and inside the date range the page asks for.
4. Explain the mismatches before anyone has to ask. A receiving account in a different name, money arriving in several instalments, a currency conversion along the way: the reviewer only knows what the documents and your note tell them.

A source-of-funds explanation is something a person has to read, which affects how it moves through review. Where it sits in the process, and why it does not come back in seconds, is covered in what happens during those hours in the review queue.