Crypto-Asset Custody Policy
1. Introduction
The Custody Policy of Coinmate a.s. (hereinafter „Coinmate„) sets out a comprehensive framework for the administration and custody of clients‘ crypto-assets in accordance with the Regulation on Markets in Crypto-Assets (EU) 2023/1114 („MiCA„). This document summarises the key aspects of the custodial services provided and the mechanisms protecting client assets.
Coinmate is aware of its essential role as a custodian and is committed to maintaining a transparent relationship with its clients. This summary provides an overview of the key aspects of the Custody Policy so that clients have a clear understanding of how their assets are managed and protected.
2. Segregation of Assets and Secure Storage
Coinmate consistently separates client assets from its own assets. Clients‘ DC are held separately from Coinmate’s DC. Coinmate’s record-keeping system ensures the continuous and unambiguous identification of client assets in a manner that allows DC held for any one client to be distinguished at all times from DC held for other clients and from Coinmate’s own DC.
Coinmate ensures that DC held by Coinmate on behalf of clients are legally separated from Coinmate’s assets, so that Coinmate’s creditors have no claim to client DC, in particular in the event of Coinmate’s insolvency.
Coinmate is entitled to use a client’s DC solely for the transactions of that specific client. With each settled transaction, the trading platform’s record-keeping system recalculates Coinmate’s obligations towards the client.
3. Multi-Layered Security Architecture
Coinmate uses a multi-tiered security system to manage client DC, comprising various types of wallets with different levels of protection. This architecture combines offline solutions offering the highest level of security for long-term storage with online solutions enabling the efficient processing of routine transactions.
The implemented systems include advanced technologies for cryptographic key management and multi-factor authentication. Coinmate regularly monitors the status of funds and implements automatic detection of discrepancies with immediate alerts to the responsible staff.
4. Client Rights and Asset Management
Coinmate holds your DC as your custodian, meaning that it provides custody of DC on your behalf. You have full rights to the value of the DC that Coinmate holds for you. You also have full power of disposal (with the exception of DC offered under the Exchange service, which are subject to specific restrictions of a technical nature) over your DC, and we will act solely on your instructions, except in the cases set out in our risk-management procedures. For DC involved in the Earn product, immediate disposal (withdrawal) may be temporarily restricted during the unbonding period in accordance with the rules of the relevant staking protocol.
Your DC may be pooled with the DC of other clients. You therefore do not have a separate account for DC. Through the Coinmate Platform you can view the amount of DC that we hold for you. By using our services, you expressly consent to the pooling of your DC with the DC of other clients.
Coinmate maintains a register of positions opened in the name of each client that uses our Custody services. Our custody policy aims to ensure that our Custody services comply with applicable laws, regulations, ICT standards, and best practices.
5. Transaction and Asset Management
Clients may at any time withdraw DC to their own wallet or to another DC custody provider, with the exception of DC acquired through the Exchange service, which are subject to specific restrictions of a technical nature.
Coinmate implements secure and efficient processes for managing transactions. All movements of assets, including deposits, withdrawals, and transfers, are carried out with the highest level of security and accuracy to ensure the integrity of client holdings.
6. Risk Management and Liability
Coinmate implements measures to minimise identified risks. It consistently adheres to the principle of asset segregation and ensures multi-tiered protection of access to wallets and accounts. Coinmate conducts regular security audits and testing, organises regular staff training, and maintains insurance against selected risks.
In the event of an emergency, Coinmate informs clients of the situation and the measures taken, cooperates with the relevant regulatory authorities, minimises the impact on clients and their assets, and implements corrective measures.
Coinmate is liable for the loss of DC or of the means of access to such DC where the loss results from an incident attributable to Coinmate. In such a case, Coinmate’s liability is limited to the market value of the lost DC at the time of the incident.
7. Reporting and Client Communication
Coinmate ensures that clients are regularly informed about the status of their assets, that information on the security measures protecting DC is available, and that the trade settlement process is transparent.
On request and at least once every three months, Coinmate will provide you with an electronic statement of the DC held in your name. The statement is also available after the client logs in to the Platform. This statement contains the current balance, the value of the DC, and information on transfers for the given period.
Communication regarding Custody may take place through various channels, including online forms on Coinmate’s website and written or electronic correspondence.
8. Fees and Services
The services provided under Custody are provided to customers free of charge. Additional fees, including the fee for withdrawing DC, are governed by Coinmate’s current price list. Participation in the Earn product is free of charge; staking rewards are shared between you and Coinmate in accordance with the Earn Program Rules.
Staking (the Earn product)
If you enrol in the Earn product, your selected DC may be involved in staking through third-party staking protocols. For some protocols, staking is carried out via a so-called liquid staking token (for example, stETH), whose value is pegged to the underlying DC but is not entirely identical to it; minor differences form part of the economic risk that you bear. Participation in staking is voluntary (opt-in) and revocable at any time. Even during staking, your DC remain your property and are segregated from Coinmate’s assets. Staking involves specific risks, in particular slashing and market/liquidity risk. These risks, the method of calculating and distributing rewards, and the currency and frequency of payouts are governed by the Earn Program Rules.
This Summary provides basic information about our custody services and procedures. For a comprehensive understanding of all the terms, please refer to the full text of the Custody Rules and the Terms and Conditions.
