Offering Access to the Securities Products
Offering access to the Securities products - for example money-market-funds - is licensed activity too.
Every website or wallet that offers access to unregistered securities is in breach of the securities regulations (including the websites aave.com and compound.finance, which offer access to unregistered security products).
Of course, there is free speech, and the right to publish the open-source code is protected by free speech. This is right; this freedom is still there. However, if free speech results in the creation of “securities products,” then additional financial regulations will apply.
Some projects declare that they are run as DAOs and the regulations do not apply to them. However, the upcoming FATF regulations handle this situation:
  • If a company controls the private keys, then this company needs to be registered as a VASP.
  • If the DAO controls the private keys of the smart contracts, then all token holders of the DAO will become a VASP (Virtual Asset Service Provider).
  • If there is no DAO and no company, then the developer deploying the contracts into the main net will become a VASP.
The VASP regulation will be rolled out worldwide. It will mandate KYC, AML, and transaction monitoring. It will mandate regulatory reporting, too. This will bring transparency to which users from which jurisdictions are using which products.
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