S.L. 590.1 Art. 17Use of client virtual financial assets.

(1) A subject person shall not use virtual financial assets which it holds on behalf of a client for its own account or for the account of any other person or client of the subject person, unless both of the following conditions are met:

(a) the client has given his prior written consent to the use of the virtual financial assets on specified terms; and

(b) the use of that client’s virtual financial assets is restricted to the specific terms to which the client consents.

(2) The records of the subject person shall include details of each client on whose instructions the use of virtual financial assets has been affected as well as the number of virtual financial assets belonging to each client who has given his consent, so as to enable the correct allocation of any loss.

(3) The subject person shall take appropriate measures to prevent the unauthorised use of client virtual financial assets for its own account or the account of any other person.

(4) The subject person shall adopt specific arrangements for all clients to ensure that the borrower of client virtual financial assets provides the appropriate collateral.

(5) The subject person shall monitor the continued appropriateness of the collateral referred to in sub-regulation (4) and take the necessary steps to maintain the balance with the value of client virtual financial assets.