EN// Glossary

This is the French public body responsible for regulating, supervising, and protecting financial markets. Its primary mission is to ensure the smooth functioning of markets and to safeguard investors. The AMF has control, sanction, and regulatory powers, particularly in areas such as financial product offerings, financial service providers’ activities, and ensuring compliance with existing rules. It also supervises Digital Asset Service Providers (PSAN).

Anti-money laundering refers to all laws, regulations, and procedures aimed at preventing and detecting money-laundering activities. Money laundering involves concealing the illegal origin of funds by integrating them into the financial system to legitimize them. AML rules require financial institutions and entities such as PSAN to implement control measures, such as customer identification (KYC) and transaction monitoring (KYT), to report suspicious activities. Failure to comply with AML regulations exposes institutions to sanctions, including fines and bans on operating.

Blockchain is a distributed, immutable database without third-party intermediaries. It enables transactions to be recorded securely. It is best known as the technology behind cryptocurrencies like Bitcoin, but it also has applications in many other areas, such as supply chain management, electronic voting, or data certification.

Compliance, in a legal and financial context, refers to an organization’s or company’s adherence to the applicable laws, regulations, standards, and practices governing its activities. This includes complying with rules imposed by regulators such as the AMF. Compliance aims to prevent illegal or unethical behavior, notably in areas such as fraud, money laundering, and non-compliance with tax and social obligations. It also involves setting up internal procedures to detect, correct, and avoid legal or regulatory risks.

Crypto-assets such as Bitcoin or Ethereum enable secure transactions without financial intermediaries. They constitute a unique asset class, independent of fiat currencies.

Crypto due diligence consists of examining a cryptocurrency’s history to determine whether it has been involved in illicit activities such as money laundering, terrorism financing, or other financial crimes. A key aspect of this analysis is "crypto tracing," conducted by specialized KYT companies that use tracking tools to identify the origin of funds and assess their "cleanliness." These analyses help evaluate the risk associated with a transaction by tracing crypto-asset flows across different wallets.

Service offered by specialized institutions to securely hold digital assets on behalf of their clients. Custody solutions include advanced technologies such as multi-signature digital wallets or offline storage (cold storage) to protect assets from cyberattacks.

In finance and economics, the term "fiat" is used to refer to a currency that is not backed by a reserve of another commodity such as gold, silver or oil. A fiat currency has intrinsic value simply because it is declared legal tender by a government authority. Fiat currencies are governed by laws created by governments that determine their issuance, distribution, value, and legal use. Most currencies in the world are fiat currencies. This is the case for the US dollar, the euro, the pound sterling, the Japanese yen, the Chinese yuan… Fiat currencies are used in most financial transactions, from daily purchases to large-scale investments.

Contract in which a settlor transfers assets, such as crypto-assets, to a trustee who manages them for the benefit of a beneficiary. This trustee is usually a company or person specialized in financial, accounting, and administrative management on behalf of others, particularly businesses. A trustee can offer various services, such as accounting, payroll management, taxation, financial consulting, and auditing.

Fixed tax levied on capital gains generated by the sale of crypto-assets. In France, this tax is 30% as of mid-2024 and includes both income tax and social contributions.

“Know Your Customer” is a client identity verification procedure imposed on financial institutions and other regulated entities. This process aims to mitigate risks related to money laundering, terrorism financing, and other illicit activities. KYC involves ensuring that clients' funds and activities are legitimate. KYC obligations are often reinforced by national and international regulations to guarantee transaction security and integrity.

“Know Your Transaction” is a procedure for monitoring and analyzing financial transactions, mainly used in the field of crypto-assets. Unlike KYC, which focuses on client identification, KYT examines the transactions themselves to detect suspicious or potentially fraudulent behavior. This method enables real-time tracking of fund movements to prevent money laundering, terrorism financing, or other illicit activities by monitoring transactions to ensure compliance with legal and regulatory standards.

This European regulation aims to govern the issuance of crypto-assets and related services that fall outside the scope of existing regulations on financial instruments and products, by establishing a harmonized regulatory framework across Europe. It replaces the national regulations previously adopted by certain EU member states. MiCA came into force on 29 June 2023, and is fully applicable from 30 December 2024.

The process by which digital assets, such as crypto-assets, are converted into fiat currency, such as euros or dollars. Off-ramping is a key step for crypto-asset holders seeking to use their liquidity in the real economy.

A profit earned from the sale or conversion of a digital asset at a price higher than its purchase price. Capital gains on cryptocurrencies are subject to taxation, notably through the flat tax.

PSAN stands for "Digital Asset Service Provider" in France, a status established by the Financial Markets Authority (AMF) to regulate players in the cryptocurrency and other digital asset sectors. This status is mandatory for companies offering certain types of services related to digital assets, such as facilitating the purchase, sale, storage, exchange, or trading of digital assets. The PSAN status aims to ensure user security and limit risks associated with money laundering and terrorist financing.

Unlike the registration, which is mandatory for companies conducting certain activities, the PSAN license is optional. It certifies that the licensed company has implemented enhanced protection measures. To obtain this license, strict rules must be followed regarding financial resources, internal organization, and transparency toward clients. The requirements for the PSAN license are therefore more stringent than those for PSAN registration and align with provisions set out by the MiCA regulation.

A set of laws and regulations governing activities related to digital assets, including their issuance, custody, sale, and the services offered by PSANs. Regulation ensures transparency and transaction security. In the field of digital assets, regulation aims to protect investors, prevent market abuse, combat money laundering, and counter-terrorism financing, while ensuring that actors comply with applicable laws.

Escrow is a legal procedure whereby a person or entity, known as the escrow agent, is designated to temporarily hold assets or funds until a predetermined condition is met, usually the completion of a transaction or resolution of a dispute. Escrow is used to protect the parties' interests in a transaction or dispute, ensuring that assets are held securely and only released once obligations are fulfilled. This measure provides legal security throughout the process.

A stablecoin is a crypto-asset designed to maintain a stable value, in contrast to other crypto-assets often subject to significant fluctuations. Stablecoins are generally backed by reserve assets such as fiat currencies (euro, dollar, etc.), commodities (like gold), or a basket of various assets. There are also algorithmic stablecoins, where stability is automatically maintained by mathematical algorithms. Their goal is to provide the advantages of crypto-assets (speed, decentralization) while offering price stability, making them suitable for transactions and fund management without facing the volatility typically associated with traditional crypto-asset markets.

As part of a cryptocurrency escrow, their values ​​are likely to fluctuate over time. To ensure a transaction of a predetermined amount in euros, it is therefore necessary to block a greater quantity of assets. The overcollateralization ratio will depend on the assets, their fluctuation history and the associated risk.