IEIM8000260 - Specified Electronic Money Products

For a cryptoasset to be classed as a specified electronic money product (SEMP) it must be:

  • a digital representation of a single fiat currency,
  • issued on receipt of funds for the purpose of making payment transactions,
  • represented by a claim on the issuer denominated in the same fiat currency,
  • accepted in payment by a natural or legal person other than the issuer, and
  • by virtue of regulatory requirements to which the issuer is subject, redeemable at any time and at par value for the same fiat currency on request of the holder of the product.

The term SEMP does not include a product created for the sole purpose of facilitating the transfer of funds from a customer to another person pursuant to instructions of the customer. A product is not created for the sole purpose of facilitating the transfer of funds if, in the ordinary course of business of the transferring entity, either the funds connected with such product are held longer than 60 days after receipt of instructions to facilitate the transfer, or, if no instructions are received, the funds connected with such product are held longer than 60 days after receipt of the funds.

SEMPs may be electronically or magnetically stored, including online payment accounts, and physical cards using magnetic stripe technology.

Under CRS, the definition of“Depository Institution”and“Depository Account” has been amended to accommodate SEMPs.