Crypto Risk & Investment Intelligence

Risk solutions to help organizations assess and reduce cryptocurrency risk, comply with regulations and generate alpha.

1000+ Cryptos Assessed for Risk

How Can We Help You?

  • Crypto Compliance: UK Consumer Duty, UK Financial Promotions (due diligence/risk report per cryptoasset)
  • Crypto Compliance: MiCA (EU) risk assessment per crypto
  • Risk groups: Risk reduction for crypto exposure
  • Crypto ETPs/funds: Risk scores for alpha generation on crypto baskets
  • Banks: Crypto wealthtech solution (basket recommendation) for bank’s clients

Check the video below to learn about our products.

Check SupraFin’s live demo at FinovateFall in NY.

Crypto Regulation

UK Regulation

The Financial Conduct Authority (FCA) adopted the UK financial promotions regime for cryptoassets on 8 October 2023. Also, on 6 Nov 2023, as part of Phase-1 regulation, the FCA and the Bank of England issued consultation papers about stablecoins to regulate stablecoins by Q2 2024. In 2024, the UK government will set the timeline for Phase-2 cryptoasset regulation, affecting the remaining cryptoassets (stablecoins are Phase 1). This new regulation will force all crypto exchanges to apply for full FCA authorisation, and there will be more requirements for risk disclosure related to all cryptoassets, among other things. Also, the UK government plans to leverage IOSCO’s (The International Organization of Securities Commissions) recommendations for regulating decentralised finance (DeFi).

SupraFin has commented on many of these consultations and offers cryptoasset risk scores, risk analysis reports, and advice to help deal with the risk management required by the current and upcoming cryptoasset regulations. Contact us at [email protected] to learn about our products.

Below is more information on the current regulations related to the cryptoasset financial promotion regime, the future financial services regulatory regime for cryptoassets, and the consultations for stablecoins.

Financial Promotions Regime for Cryptoassets

The FCA’s Financial Promotion Regime for Cryptoassets took effect on 8 Oct 2023 and applies to all firms that market cryptoassets to UK consumers, regardless of whether the firm is based overseas. To ensure firms clearly understand the requirements for cryptoasset promotions, alongside the FCA final rules (PS23/6) for Cryptoasset Financial Promotions published on 8 Jun 2023, the FCA published the Final Guidance for Cryptoasset Promotions (FG23/3) on 2 Nov 2023.
Under the regime, cryptoasset financial promotions must be fair, clear, and not misleading. SupraFin offers crypto risk analysis reports that can help with the required due diligence and the actual financial promotions.

Future Financial Services Regulatory Regime for Cryptoassets

On Oct 2023, HM Treasury published the results of their consultation on cryptoassets (“Future Financial Services Regulatory Regime for Cryptoassets“). In summary, most regulations affecting cryptoassets will be implemented in Phase 2 (the timeline for Phase 2 will be introduced in 2024). In Phase 2, all cryptoasset exchanges must apply for full FCA authorisation, and investment management activities related to cryptoassets won’t be regulated in Phase 2 but in a later phase. The UK government plans to leverage the work of the Financial Stability Board (FSB) and the Organization of Securities Commissions (IOSCO) to regulate DeFi and set sustainability standards related to crypto.

Discussion Paper (DP23/4): Regulating cryptoassets Phase 1: Stablecoins

As part of the UK government’s regulation on stablecoins (Phase 1), the FCA launched a consultation on Nov 2023, which ended on 6 Feb 2024. The FCA’s regime will aim to address the risks of stablecoins that claim to maintain a stable value relative to a fiat currency by holding assets denominated in that currency when used as money-like instruments, i.e. for payments (and other uses) at a non-systemic scale. They will regulate, for prudential and conduct purposes, all non-systemic UK-based issuers of stablecoins. They will also regulate custodians of such stablecoins, including those providing custody services from the UK and those providing custody services to UK-based customers. HM Treasury is also exploring how stablecoins issued outside the UK can be safely used in UK payment chains.

Topics covered in the consultation paper included:

  • Backing assets
  • Regulated stablecoin issuers
  • Custody requirements
  • Organisational requirements
  • Conduct of business and consumer redress
  • Prudential requirements
  • Managing regulated stablecoin issuers and custodian firm failures
  • Regulating payments using stablecoins
  • Overseas stablecoins used for payment in the UK

Regulatory Regime for Systemic Payment Systems Using Stablecoins and Related Service Providers

As part of the UK government’s regulation on stablecoins (Phase 1), the Bank of England (BoE) launched a consultation on Nov 2023, which ended on 6 Feb 2024. The Bank of England is responsible for creating a new regulatory framework for “systemic” payment systems using stablecoins and related service providers. The new regulatory framework will ensure that stablecoins can be utilised as a safe “payment” means in the UK. Below are the key items addressed in the paper:

  • HM Treasury decides which payment systems and service providers are systemically important.
  • Systemic stablecoins should only be used for payments (not other functions), always be exchanged at par, and be sterling-denominated and backed by sterling-denominated assets.
  • Systemic stablecoin issuers should fully back the stablecoins in issue with central bank deposits, and they should not receive interest on the deposits or pay interest to stablecoin holders.
  • Assets backing systemic stablecoins are expected to be kept in a segregated account and protected from claims of other creditors through a trust arrangement.
  • BoE recommends that one entity (e.g., the stablecoins issuer) be responsible for the safe and proper operation of the transfer function; however, we think independent third parties should also help assess and monitor the risks of public blockchains and their respective cryptoassets.

EU Regulation

Markets in Crypto-assets Regulation (MiCAR or MiCA) regulates crypto-asset issuance and service provision in the EU. MiCA encompasses activities such as offering asset-referenced tokens (ARTs) and electronic money tokens (EMTs) to the public or seeking admission for trading, as well as issuing such tokens.

MiCA came into force on 29 Jun 2023, with the provisions about ARTs and EMTs applicable from 30 Jun 2024. MiCA for the rest of the crypto-assets will apply starting 30 Dec 2024. As part of MiCA’s implementation, The European Banking Authority (EBA) and The European Securities and Market Authority (ESMA) have launched many consultations.

SupraFin has commented on many of these consultations and offers crypto-asset risk scores, risk analysis reports, and advice to help deal with the risk management required by the current and upcoming crypto-asset regulations. Contact us at [email protected] to learn about our products.

Below is more information on the consultations by ESMA and EBA.

Consultations related to MiCA by ESMA

During the implementation phase of MiCA, The European Securities and Markets Authority (ESMA) is consulting with the public on a range of technical standards that will be published sequentially in three packages. The date for the entry into application of the measures is subject to their adoption by the European Commission and approval by the European Parliament and the Council of the EU.

The first package, published in July 2023, included content of notification from selected entities to National Competent Authorities (NCAs), forms and templates for notification from entities to NCAs, content of the application for authorisation for Crypto-Asset Service Providers (CASPs), forms and templates for CASP authorisation application, complaint handling procedure, management and prevention, disclosure of conflict of interest, and intended acquisition information requirements.

The second package, published in October 2023, included sustainability indicators, business continuity requirements, trade transparency data and order book record-keeping, record-keeping requirements for CASPs, classification and templates and format of crypto-asset white papers, and public disclosure of inside information.

ESMA will publish the third and final consultation package in Q1 2024 and will cover all remaining mandates, including qualification of crypto-assets as financial instruments, monitoring, detection, and notification of market abuse, investor protection, reverse solicitation, suitability of advice and portfolio management services to the client, policies and procedures for crypto-asset transfer services (including clients’ rights), and system resilience and security access protocols.

Consultations related to MiCA by EBA

Under MiCA, The European Banking Authority EBA supervises “significant” ARTs and EMTs.
The EBA is also responsible for developing 17 technical standards and guidelines to specify further the requirements for any (significant and non-significant) ARTs and EMTs. As part of that, EBA has launched several consultations, five of which were due on 8 Feb 2024.

Below are the five consultations that were due on 8 Feb 2024:
1. Draft Guidelines on recovery plans under Articles 46 and 55 of the Regulation (EU) 2023/1114: set out an obligation for issuers of asset-reference tokens (ARTs) and issuers of e-money tokens (EMTs) to develop and maintain a recovery plan providing for measures to be taken by the issuer to restore compliance with the requirements applicable to the reserve of assets in cases where the issuer fails to comply with those requirements.
2. Draft Regulatory Technical Standards (RTS) to further specify the liquidity requirements of the reserve of assets under Article 36(4) of Regulation (EU) 2023/1114. Issuers of asset-referenced tokens, whether the asset-referenced tokens are classified as significant or not, are required to constitute and maintain a reserve of assets at all times.
3. Draft RTS to specify the highly liquid financial instruments with minimal market risk, credit risk and concentration risk under Article 38(5) of Regulation (EU) 2023/1114. Issuers of asset-referenced tokens, irrespective of whether they are significant or not, are required to decide to invest the proceeds they receive from the issuance of the tokens and form part of the reserve of assets, shall do it in financial instruments that are highly liquid and with minimal market risk, credit risk and concentration risk.
4. Draft RTS to specify the minimum contents of the liquidity management policy and procedures under Article 45(7)(b) of Regulation (EU) 2023/1114.
5. Draft RTS to specify the adjustment of own funds requirements and stress testing of issuers of asset-referenced tokens and of e-money tokens subject to the requirements in Article 35 of Regulation (EU) 2023/1114 on markets in crypto-assets.

Global Regulation

Final Report on DeFi by IOSCO

On Dec 19 2023, the International Organization of Securities Commissions (IOSCO) published its final report on DeFi, which includes nine recommendations for regulators worldwide. IOSCO is the international body that brings together the world’s securities regulators.

DeFi refers to the provision of financial products, services, arrangements and activities that use distributed ledger technology (DLT): decentralized exchanges (DEX), decentralized lending, DEX aggregators, yield aggregators, etc.

Below are IOSCO’s nine policy recommendations to address market integrity and investor protection concerns arising from DeFi.

1. Analyze DeFi products, services, activities, and arrangements in accordance with the principle of “same activity, same risk, same regulation/regulatory outcome.”
2. Identify responsible persons and entities of a purported DeFi arrangement that could be subject to its applicable regulatory framework. These responsible persons include those exercising control or sufficient influence related to the DeFi arrangement.
3. The regulatory approach should be functionally based to achieve regulatory outcomes for investor protection and market integrity that are the same as or consistent with those required in traditional financial markets.
4. Require responsible persons to identify and address conflicts of interest.
5. Require responsible persons to identify and address material risks, including operational and technology risks.
6. Require responsible persons to provide clear, accurate, and comprehensive disclosures to the DeFi products and services offered.
7. Enforce applicable laws on DeFi that are consistent with the principle of “same activity, same risk, same regulation/regulatory outcome.”
8. Promote cross-border cooperation and information sharing.
9. Understand and assess Interconnections among the DeFi market, the broader Crypto-Asset market, and traditional financial markets.

Insights: Reports, Webinars, and Events

Reports

Case Study: Predicting the Collapse of FTX by Understanding the Riskiness in FTT: Email [email protected] to get a free copy of this case study and to learn how SupraFin’s crypto risk scores detected the design flaw in the token design on this crypto since inception.

Case Study: Terra (Luna/UST): Email [email protected] to get a free copy of our case study on Terra (Luna/UST) and to learn how SupraFin’s crypto risk scores detected the design flaw in the stability mechanism on these cryptos since inception.

Webinars and Events

Below are our most recent news or upcoming events. To view selected past events, webinars, and news related to SupraFin, please click here: https://suprafin.io/news-events/

April 18, 2024

SupraFin at CMU’s Blockchain Conference

On April 18, 2024, SupraFin’s CEO will participate in two panels at Carnegie Mellon University’s Blockchain Conference: DeFi and Governance in Blockchain. CMU’s inaugural Blockchain Industry Conference will focus on real-world blockchain use cases and feature talks from industry practitioners.

April 9-11, 2024

SupraFin at Paris Blockchain Week

SupraFin will meet businesses interested in crypto risk & investment solutions at Paris Blockchain Week.

The Team

crypto expert

Liliana Reasor

Founder & CEO

Liliana is an entrepreneur and visionary with 20 years of FinTech (crypto, risk and portfolio management analytics and software), investment banking, and capital markets experience at JP Morgan, Deutsche Bank, Bank of America, Morgan Stanley, and Moody’s Analytics. She has expertise in cryptocurrencies, blockchain, complex investment and risk analytics, trading, portfolio management, tech investments, and quantitative finance. She has an MBA from UCLA Anderson and an MS in Computational Finance from Carnegie Mellon University.

Laurent Nguyen-Ngoc

Chief Quant Officer

Laurent is an expert in quantitative finance. Previously, he was the US Head of Quants for IHS Markit in New York. He has 12 years+ of experience in risk & pricing models, structuring, and hedging. He has expertise in machine learning, risk-neutral pricing models, computational algorithms, and optimization techniques. He has a Ph.D. in Stochastic Calculus & Math Finance from Pierre & Marie Curie University, France.

Blair Halliday

Special Advisor for Digital Assets Compliance & Regulation

Blair is a leading executive in the digital assets industry and a recognised industry expert in regulatory compliance and anti-financial crime in the UK. He has held leadership and executive positions at Kraken, Gemini, Circle, CashFlows, ICE and Paysafe Group. Blair was named one of the most influential people in Digital Assets by Wall Street Journal/ Financial News London.

Vidyaranya Vuppu

CTO

Vidya has more than 20 years of experience in software development and leadership in information technology. He has four patents in the area of mobile connectivity. He has an AMIETE (Bachelor of Engineering) in Electronics & Telecommunications from The Institute of Electronics & Telecommunication Engineers in India.

The Advisory Board

Joachim Sonne

Strategy & Capital Raising

Joachim is the former Co-Head of EMEA Technology, Media, and Telecoms Investment Banking at JP Morgan. He has 20 years+ of experience in technology, media, and telecom investment banking at JP Morgan in London, New York, and Frankfurt.

Colin Morrell

Business Coach & Mentor

Colin is an entrepreneur and business coach with 25 years of experience. He currently provides business coaching through Vistage Worldwide, an organization designed exclusively for high-integrity CEOs and executive leaders. He was previously the CEO of Appleyards Ltd, a consultancy business.

Craig Dewar

FinTech Entrepreneurship

Craig is a FinTech serial entrepreneur and investor, and ex-investment banking professional. He co-founded Flex-e-card in 2000 before co-founding Global Processing Services. He was a former technology director in investment banking and front office systems within Salomon Brothers, JP Morgan, and CSFB.

Noreen Cesareo

Marketing

Noreen is an experienced international marketing, brand, and communications specialist with 30 years+ working with global brands across industries. She is the founder of Market Accents, strategic marketing and communications advisory firm. She is also a Director at The Malta Business Network and Co-Chair of the International Trade and Connections Work-Group at the UK All Parliamentary Group for Women and Enterprise.

Toni Pettipiece

Business Development

Tony is the Chairman of the Board at GRIP, an Investment Banking and Wealth Management firm established within the Dubai International Financial Centre. He is a Board Member of the Global Digital Asset & Cryptocurrency Association in Chicago and a Principal at TPLLC, a Chicago-based digital consulting/investing company. He was the former Global Head of Prediction Trading at UBS and a Technology Manager at JP Morgan.

Ashish Kumar

Strategic Partner

Ashish is the founder of TribulusTech, a software development company. He is an entrepreneur with ten years of experience in FinTech, IoT, e-commerce, digital media, and media/entertainment businesses in India and globally. He is a financial partner to founders and CEOs, emphasizing strategic planning, investor relations, corporate development, business development, human resources, IT, business operations, and business analytics.

Adolfo Tunon

FinTech Advisor

Adolfo is a senior advisor at McKinsey & Company with 30+ years of experience in the financial services industry. He is a global transaction banking, payments, liquidity, sales, fixed income, and corporate relationship leader who worked as MD Regional Head of Products/Sales, EMEA Global Liquidity Cash Management at HSBC; MD Head of Cash and Trade, EMEA Global Transaction Services, at Royal Bank of Scotland, and MD and Head of Client Experience, Treasury and Trade Solutions, EMEA at Citi. 

Our Partners / Collaborators

Connect with Us

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Blockchain for Inclusion group on LinkedIn
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Liliana Reasor on Twitter
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SupraFin CEO on Medium
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Contact Us

Contact us at [email protected]

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As with all investing, your capital is at risk. The value of your digital assets / crypto currencies can go down as well as up and you may get back less than you invest.