Add terms and definitions to Part 1, Section 2 (Interpretation):
“fintech service technology” means any combination of hardware and software that is developed and employed to provide fintech services that use innovative technology to improve, change, or enhance financial services.
“fintech service technology provider” means any natural or legal person which develops technology for use by fintech service providers, but which does not directly offer or provide fintech services.
“virtual asset service technology” means any combination of hardware and software that is developed and employed to provide virtual asset services.
“virtual asset service technology provider” means any natural or legal person which develops virtual asset service technology for use by virtual asset service providers, but which does not directly offer or provide virtual asset services.
Add clarification to Part 1 Section 3 (Meaning “virtual asset service provider”) in a new item 3:
(3) For the purposes of this Act, virtual asset service technology providers which only develop technology for use by virtual asset service providers are not themselves virtual asset service providers and are not required to have a license or registration under this Act.
Proposal Reasoning
Technology developers are in effect "wholesalers" who provide the technological foundation for "retailers" which then offer virtual asset services to the public (arguably this relationship also holds for fintech service technology providers and fintech service providers, though the Act does not elaborate on fintech services in as great detail as it does for virtual asset services and virtual asset service providers).
Put simply, since virtual asset service providers are the subject of the Act, they are presumably most attuned (1) to the types of services which they wish to offer, (2) the technology necessary to support the services they wish to offer, and (3) the level of supervision / auditing they will be required to meet, based on the ultimate targets (beneficiaries) of the services they will provide. Clearly it is the responsibility of a VASP to ensure that policies, procedures, and systems chosen by the VASP will address their responsibilities to their customers and to regulators. Equally clearly, the provider of virtual asset service technology should only be responsible to its customers (i.e. VASPs), not directly to the VASPs' customers or the the regulators who govern the relationship between VASPs and VASP customers/clients.
Microsoft Word is used to write legally binding documents ranging from Contracts to Legislation, yet Microsoft itself (the technology provider) is not registered or regulated as a member of the bar in any jurisdiction.
Affected Legislation
Virtual Asset (Service Providers) Act (2022 Revision)
Affected Section
Part 1 Preliminary (Sections 2 and 3)
Proposed Changes
Add terms and definitions to Part 1, Section 2 (Interpretation): “fintech service technology” means any combination of hardware and software that is developed and employed to provide fintech services that use innovative technology to improve, change, or enhance financial services. “fintech service technology provider” means any natural or legal person which develops technology for use by fintech service providers, but which does not directly offer or provide fintech services. “virtual asset service technology” means any combination of hardware and software that is developed and employed to provide virtual asset services. “virtual asset service technology provider” means any natural or legal person which develops virtual asset service technology for use by virtual asset service providers, but which does not directly offer or provide virtual asset services.
Add clarification to Part 1 Section 3 (Meaning “virtual asset service provider”) in a new item 3: (3) For the purposes of this Act, virtual asset service technology providers which only develop technology for use by virtual asset service providers are not themselves virtual asset service providers and are not required to have a license or registration under this Act.
Proposal Reasoning
Technology developers are in effect "wholesalers" who provide the technological foundation for "retailers" which then offer virtual asset services to the public (arguably this relationship also holds for fintech service technology providers and fintech service providers, though the Act does not elaborate on fintech services in as great detail as it does for virtual asset services and virtual asset service providers).
Put simply, since virtual asset service providers are the subject of the Act, they are presumably most attuned (1) to the types of services which they wish to offer, (2) the technology necessary to support the services they wish to offer, and (3) the level of supervision / auditing they will be required to meet, based on the ultimate targets (beneficiaries) of the services they will provide. Clearly it is the responsibility of a VASP to ensure that policies, procedures, and systems chosen by the VASP will address their responsibilities to their customers and to regulators. Equally clearly, the provider of virtual asset service technology should only be responsible to its customers (i.e. VASPs), not directly to the VASPs' customers or the the regulators who govern the relationship between VASPs and VASP customers/clients.
Microsoft Word is used to write legally binding documents ranging from Contracts to Legislation, yet Microsoft itself (the technology provider) is not registered or regulated as a member of the bar in any jurisdiction.
Jack Copper NeuralStudio SEZC