Virtual Asset Listing
In considering whether a Virtual Asset (underlying the derivative contracts) is eligible to be listed on the exchange, Deribit will carry out appropriate due diligence on the Virtual Asset and the Issuer of the Virtual Asset. The following Listing Standards will be considered in carrying out the due diligence:
Listing Standards
1. its market capitalisation, fully diluted value and liquidity, and whether such metrics have trended downwards over time;
2. its design, features and use cases, whether or not intended by the Issuer or relevant developers;
3. whether there are features which may materially affect Deribit’s compliance with applicable laws, regulations, rules or directives, including but not limited to those relating to AML/CFT, sanctions, securities, intellectual property;
4. regulatory treatment by the Virtual Assets Regulatory Authority (VARA) of Dubai and other appropriate authorities (including those outside of Dubai), in particular whether the issuance of the Virtual Asset has received any regulatory approvals;
5. whether a Virtual Asset is prohibited by VARA or any other appropriate authorities (both inside or outside the UAE) in jurisdictions in which Deribit will provide services in relation to such Virtual Asset;
6. the security and immutability of the underlying DLT protocol;
7. its future development (such as the roadmap) as communicated by the Issuer and/or relevant developers;
8. whether it may be susceptible to price manipulation for any reason and relevant mitigations that will be implemented by Deribit;
9. whether potential or actual conflicts of interest may arise should Deribit provide any services in relation to the Virtual Asset and relevant mitigations;
10. the background of its Issuer including, but not limited to, relevant experience in the Virtual Asset sector and whether it has been subject to any investigations or claims in relation to fraud or deceit;
11. if the Virtual Asset represents rights to any other assets, the enforceability of such rights;
12. sufficient assets are available to satisfy any obligation with respect to services offered in respect of the Virtual Asset; and
13. whether the Virtual Asset terms and conditions reflect, to the extent possible, the correlation of any existing underlying physical market and avoid adverse impacts to such market (if applicable).
Required information
In determining whether the Virtual Asset meets the Listing Standards, Deribit will obtain and review all relevant information including:
1. The Virtual Asset’s white paper;
2. information about the Issuer and any individuals responsible for designing the Virtual Asset;
3. the essential characteristics of the Virtual Asset, including the rights attaching to the Virtual Asset and any project or venture to be funded (where relevant);
4. details of the persons responsible for performing obligations associated with the Virtual Asset and details of where and against whom rights conferred by the Virtual Asset may be exercised;
5. information regarding the underlying technology of the Virtual Asset, including protocols and technical standards adhered to;
6. details regarding how ownership of the Virtual Asset is established, certified or otherwise evidenced; and
7. the method by which the Virtual Asset will be valued, including any benchmarks, indices or third parties are relied on.
Delisting
A Virtual Asset may be delisted and suspended if any of the following occur:
1. the Virtual Asset has been suspended or delisted in another jurisdiction;
2. the Virtual Asset no longer meets the listing criteria;
3, the trading of the Virtual Asset is detrimental to the orderly operation of the Deribit exchange or its reputation;
4. the Virtual Asset ceases to exist;
5. if directed to do so by the VARA; or
6. for any commercial reason as may be determined by Deribit.
If a Virtual Asset is delisted, Deribit may impose requirements in respect of the lifting of the suspension of the Virtual Asset as may be appropriate in the circumstances.
If a Virtual Asset is to be delisted, a written notification will be sent to clients to notify them of the delisting and providing clients a reasonable period of time as may be appropriate in the circumstances to liquidate their holdings, and the Virtual Asset will be delisted and removed from the Deribit website and API.
Relisting
If a Virtual Asset is delisted, Deribit may impose requirements in respect of the lifting of the suspension of the Virtual Asset as may be appropriate in the circumstances.
Deribit will inform the VARA of any intention to relist a delisted Virtual Asset.