Regulatory & Compliance

What are the regulatory requirements for using iBTC?

iBTC itself operates as a decentralized protocol. We do not hold user BTC, so we do not require a Money Transmitter License or SEC/CFTC registration. However, institutions acting as merchants may have specific regulatory obligations depending on their jurisdiction and business activities. We recommend seeking legal counsel to ensure compliance.

Does becoming a iBTC merchant require KYB/KYC?

Yes. Merchants must undergo KYB (Know Your Business) and KYC (Know Your Customer) procedures. This helps ensure the integrity of the iBTC ecosystem and mitigates risks associated with money laundering and other illicit activities.

Is iBTC considered a security?

No, iBTC is not classified as a security. It's important to recognize that Bitcoin itself is widely recognized as a commodity, not a security. iBTC, being a decentralized wrapped version of Bitcoin where merchants retain full control and ownership of their assets, inherits this commodity attribute. Furthermore, there's no scenario where we take custody of user funds, further distinguishing it from securities which often involve investment contracts and the expectation of profits from the efforts of others.

How does iBTC address compliance challenges in the traditional financial sector?

We understand the complexities of navigating the regulatory landscape. iBTC is designed as Software-as-a-Service, aiming to simplify compliance for institutions. We're actively working on providing comprehensive flow diagrams, legal opinions on tax implications, and security classifications to assist institutions in their due diligence process.

What are the tax implications of using iBTC?

Tax implications can vary depending on jurisdiction and specific use cases. We recommend consulting with tax professionals for personalized advice. We're also working on providing general legal opinions on potential tax considerations related to iBTC.

Why is iBTC not available in certain countries?

Due to legal and regulatory restrictions, iBTC services are not offered in jurisdictions where cryptocurrency use is prohibited or where trade sanctions apply.