Content and form of the Cryptoassets White Paper

The White Paper for cryptoassets is a document that describes the technology, architecture and design behind a cryptoasset. It is used to establish the technical foundations and objectives of the project. It has an important role in the legal arena, as it can be considered as a source of information to determine the legal status of a cryptocurrency or token.

The analysis of the technical elements and project objectives contained in the White Paper is an important step in assessing the legal nature of cryptoassets and their regulation.

The European Union regulation “Markets in Crypto Assets” (MiCA) will require the white paper to follow forms, formats and templates (article 5.11 of the MiCA regulation). And it will be issued apparently by the European Securities and Markets Authority (ESMA).

The following form comprises the requirements currently contained in the draft MiCA regulation.

Clarifications on the White Paper:

• Only legal entities may create and submit a White Paper;
• The White Paper shall be published on the website no later than the day of the offering of the Crypto-assets;
  The White Paper shall be available on the website for the duration of the time the cryptoassets are in the hands of the public;
• The Crypto Assets White Paper shall not contain any material omissions and shall be presented in a concise and understandable form;
• It must be available in machine-readable format;
• Issuers are under the obligation to notify the competent authority in their country at least 20 working days prior to the publication of the White Paper on their website;
• It must contain the date of creation and publication.

The introduction to the White Paper should contain:

1. The statement of the management body of the issuer of cryptoassets;
2. Expressly contain the following statement: “By this declaration, the management body of the cryptoasset issuer expresses its confirmation regarding the observance of the requirements set forth in Title II (Content and Form of the Cryptoasset White Paper; Article 5), and assures that, to the best of its knowledge and belief, the information contained therein is accurate and free of material omissions.”
3. The Cryptoassets White Paper shall contain a summary with these characteristics:
   1. The summary should be read as an introduction to the cryptoasset white paper;
   2. The prospective purchaser should base his possible decision to purchase cryptoassets on the contents of the entire cryptoasset white paper;
   3. The public offering of cryptoassets does not constitute an offer or invitation for the sale of financial instruments, which may only be made by means of a prospectus or other offering document under national law;
   4. The cryptoasset white paper does not constitute a prospectus within the meaning of Regulation (EU) 2017/1129 or any other type of offering document under national or Union law.

The body of the White Paper should contain the following:

1. Detailed description of the issuer;
2. Presentation of the main participants in the design and development of the project;
3. Detailed description of the project:
   1. Type of cryptoasset;
   2. The intended use of the fiat currency or other cryptoassets obtained in the public offering.
4. It must expressly include the following statement: “The issuer of the cryptoassets is solely responsible for the content of this cryptoasset white paper. This has not been reviewed or approved by any competent authority of any member state of the European Union.”

• It must include the following clarifications in an express and clear manner:
  • “Cryptoassets may lose their value in whole or in part;
  • “Cryptoassets may not always be tradable;”;
  • “Cryptoassets may not be liquid;”
  • “Where the public offering relates to service tokens, these tokens may not be redeemable for the good or service promised in the cryptoasset white paper, especially in the event of failure or disruption of the project.”

5. Offering of Crypto Assets:

• Characteristics of the public offering:
• Number of cryptoassets to be issued;
• Issue price of the cryptoassets;
• Terms of subscription to the cryptoassets.

6. Description of the Rights and Obligations associated with cryptoassets:

• Procedure and conditions for the exercise of these rights.

7. Underlying technology::

• Description of the underlying technology;
• How crypto assets are held, stored and transferred.

8. Detailed description of the associated risks:

• Risks related to:
  • The issuer of cryptoassets;
  • Of cryptoassets;
  • The public offering of cryptoassets;
  • The execution of the project.

The White Paper cannot include:

• No assertion about the future value of cryptoassets. Unless the issuer can guarantee such future value.

Modifications to the White Paper:

• Any modification must be notified on the website;
• It must also be notified to the competent authority at least 7 working days prior to the modification and publication on the website.

This form provides comprehensive and up-to-date guidance to ensure that the White Paper complies with regulatory requirements, which will ensure that the crypto asset project conforms to EU regulatory standards. However, completing the form does not guarantee acceptance by the competent authority to allow the public offering of the crypto assets presented in the White Paper.