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  • Writer's pictureадв. Светослав Григоров

Custody and administration of crypto-assets on behalf of third parties

Updated: Jun 13, 2023

Custody and administration of crypto-assets service providers for negotiating duties and responsibilities with their clients.

The agreement contains:

- data on the parties;

- description of the service;

- method of communication and authentication of the client's identity;

- security system;

- fees payable to the supplier;

- applicable legislation.

Custody and administration of crypto-assets

Providers implement internal rules and procedures to protect crypto-assets. Maintain a customer register that records asset movements. An extract from it is provided at least every 3 months and upon request.

Suppliers separate their own funds and those of their customers. They are liable for the loss of crypto-assets due to a malfunction or hacking attack up to the amount of their market value.

Operation of a trading platform

The rules for managing a crypto-asset trading platform define:

- conditions for admitting crypto-assets to the platform;

- the categories that will not be allowed to trade;

- procedures and fees for admission to the platform;

- criteria for participation in trading;

- guarantees for fair and regular trade;

- liquidity conditions;

- suspension of trading;

- guaranteeing an effective settlement.

A crypto-asset must meet the above rules before being allowed to trade on a platform. Its quality is also evaluated according to the issuer and its development team.

Crypto-assets with a built-in anonymization function are prohibited unless their holders and the history of transactions with them can be established.

The management rules are drawn up in one of the official languages ​​of the country or one commonly used in international finance.

Providers do not trade for their own accounts on the platform they manage.

Systems and procedures are being built to ensure that trading on the platform is sustainable, and continuous, has sufficient capacity, respects trading limits, and has passed checks.

The trading platform makes public all "buy" and "sell" prices, as well as information about completed transactions.

Exchange of crypto-assets against fiat currency or other crypto-assets

Suppliers establish a commercial policy stating the conditions to which customers must comply.

Transactions are carried out at fixed prices, publishing information about the orders and concluded transactions.

Providers establish a policy for the execution of orders related to crypto-assets, ensuring fair and prompt execution.

Execution of orders

Service providers provide the following information before entering into a contract with them:

- the type of placement;

- the fees;

- the term, procedure, and price;

- buyer information.

Reception and transmission of orders

Providers implement procedures for the timely transmission of customer orders and their execution on a crypto-asset trading platform.

Advice on crypto-assets

Providers implement procedures for the timely transmission of customer orders and their execution on a crypto-asset trading platform.

Regarding custody and management of crypto-assets on behalf of third parties, please contact us by going to contacts.

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