//Glossary49 terms5 categories
ChainChoice Crypto + EU Regulation Glossary
49 structured definitions covering MiCA, EU crypto regulation, CASP compliance, wallet and exchange products, blockchain technology, and EU crypto taxation. Each entry has a citation-anchor URL hash for journalists, AI summarizers, and researchers to link directly. The structured DefinedTermSet schema below makes this glossary machine-readable and AI-citation-preferred.
Last reviewed2026-06-04
AUDIT RECEIPT#cc-GLOSSARY-2026.06 ↗methodology §3 ↗affiliate economics did not influence this ranking
Regulation (10)
MiCA
#micaMarkets in Crypto-Assets Regulation (EU) 2023/1114. The European Union's comprehensive crypto framework, applicable across all 27 member states from 30 December 2024. Crypto-asset service providers (CASPs) must hold authorisation in one member state to passport services across the EU + EEA.
CASP
#caspCrypto-Asset Service Provider. Under MiCA, any legal entity providing one or more crypto-asset services (custody, trading, exchange, advice, portfolio management, etc.) to clients within the EU. CASPs require authorisation from a national competent authority.
Passporting
#passportingThe EU regulatory principle allowing a service provider authorised in one member state to provide its services across all other member states without separate authorisation. MiCA establishes passporting for CASPs across the full EU + EEA.
ESMA
#esmaEuropean Securities and Markets Authority. The EU-level regulator coordinating securities and crypto-asset supervision across national competent authorities. Maintains the public MiCA register of authorised CASPs.
BaFin
#bafinBundesanstalt für Finanzdienstleistungsaufsicht. Germany's national competent authority for financial supervision, including MiCA authorisation of crypto-asset service providers. Operates an 18-month transitional regime through 30 June 2026 for previously KWG-licensed crypto custodians.
AMF
#amfAutorité des marchés financiers. France's national securities regulator and MiCA national competent authority. Operates a transition period through end-2025 for previously PSAN-registered crypto providers.
DNB
#dnbDe Nederlandsche Bank. The Netherlands' central bank, jointly supervising MiCA-authorised CASPs with the AFM. Bitvavo holds its MiCA authorisation under joint DNB + AFM supervision.
DORA
#doraDigital Operational Resilience Act (Regulation (EU) 2022/2554). Applies to MiCA-licensed CASPs from 17 January 2025. Imposes ICT risk management, incident reporting, and third-party-risk requirements.
Travel Rule
#travel-ruleRegulation (EU) 2023/1113. Requires CASPs to attach originator and beneficiary information to crypto-asset transfers of €1,000 or more. Fully enforced alongside MiCA from 30 December 2024.
MLR / 5AMLD
#mlr5th Anti-Money Laundering Directive (EU) 2018/843, transposed into German Geldwäschegesetz (GwG). The pre-MiCA legal basis for crypto custody and exchange registration in Germany before MiCA application.
Compliance (8)
KYC
#kycKnow Your Customer. The identity-verification process CASPs perform on customers at onboarding (and periodically afterwards). MiCA-licensed CASPs implement risk-based KYC including identity documents, address verification, and source-of-funds checks for higher-risk profiles.
AML
#amlAnti-Money Laundering. The regulatory framework requiring financial firms to detect, prevent, and report money laundering. CASPs operate under MiCA-aligned AML obligations including KYC, transaction monitoring, suspicious activity reporting (SAR), and sanctions screening.
SAR
#sarSuspicious Activity Report. The formal notification a CASP must file with the national Financial Intelligence Unit (FIU) when it identifies a transaction or pattern suggestive of money laundering, terrorism financing, or other financial crime.
CDD
#cddCustomer Due Diligence. The CASP's ongoing obligation to verify, monitor, and update customer identity information based on their risk profile. Higher-risk customers (Politically Exposed Persons, high transaction volumes) face Enhanced Due Diligence (EDD).
PEP
#pepPolitically Exposed Person. A person holding a prominent public function, or their close associate/family. CASPs apply Enhanced Due Diligence to PEPs and may require senior-management approval to onboard.
SoF / SoW
#sofSource of Funds / Source of Wealth. The CASP's obligation to verify where a customer's deposited funds originated and (for high-net-worth profiles) the overall provenance of their wealth.
Affiliate-blind ranking
#affiliate-blind-rankingAn editorial-integrity discipline where the ranking of providers is computed independently of any affiliate-commission data. ChainChoice enforces this architecturally via a CI ratchet (scripts/check-affiliate-blind.mjs) that fails the build on any violation.
Content-addressed receipt
#content-addressed-receiptA receipt whose identifier is a deterministic hash of its content. Identical inputs always produce identical receipt IDs. ChainChoice signs every receipt with an Ed25519 key so its content can be cryptographically verified.
Product (12)
CEX
#cexCentralised Exchange. A CASP operating an order book where users deposit funds, the venue custodies them, and trades match counterparty orders. Examples: Bitpanda, Bitvavo, Kraken, Coinbase. CEXs are CASPs and subject to MiCA.
DEX
#dexDecentralised Exchange. A protocol allowing users to swap crypto-assets on-chain without a custodial intermediary. Examples: Uniswap, Curve, PancakeSwap. Pure DEX protocols are typically outside MiCA scope; centralised front-ends (uniswap.org, etc.) may fall within MiCA scope.
Hardware wallet
#hardware-walletA dedicated physical device storing cryptocurrency private keys in a secure-element chip, isolated from the user's phone or computer. Examples: Ledger, Trezor, Tangem, BitBox, Keystone, Coldcard. Hardware wallets are non-custodial and outside MiCA scope.
Custodial wallet
#custodial-walletA wallet where a third-party (typically a CEX) holds the private keys on behalf of the user. The user accesses funds via account credentials. Custodial-wallet providers are CASPs and require MiCA authorisation in the EU.
Non-custodial wallet
#non-custodial-walletA wallet where the user holds the private keys directly and signs transactions locally without any third party. Examples: MetaMask, Phantom, Rabby, hardware wallets. Non-custodial wallets are typically outside MiCA scope.
Stablecoin
#stablecoinA crypto-asset designed to maintain a stable value relative to a reference (typically fiat currency or a basket). MiCA distinguishes asset-referenced tokens (ARTs) and e-money tokens (EMTs), each subject to specific MiCA Titles III + IV requirements.
ART
#artAsset-Referenced Token under MiCA. A crypto-asset that aims to maintain stable value by referencing multiple fiat currencies, commodities, crypto-assets, or a basket. Subject to MiCA Title III requirements including authorisation, white paper, and reserve obligations.
EMT
#emtE-Money Token under MiCA. A crypto-asset that aims to maintain stable value by referencing the value of one official currency. EMT issuers must be authorised credit institutions or e-money institutions and meet MiCA Title IV requirements.
Staking
#stakingThe process of locking up crypto-assets (typically PoS-network tokens) to participate in network consensus and earn rewards. CASPs offering staking-as-a-service are subject to MiCA conduct rules.
Crypto lending
#lendingA product where users deposit crypto-assets to be lent out in exchange for interest. MiCA-licensed lending CASPs (e.g., Nexo) must meet specific authorisation and disclosure requirements.
Fiat onramp
#onrampA service converting fiat currency (typically via SEPA, card, or instant payment) into crypto-assets. Onramp providers are CASPs under MiCA.
Fiat offramp
#offrampThe inverse of onramp — converting crypto-assets back into fiat for withdrawal to a bank account. Subject to the same CASP obligations as onramps.
Technology (10)
BIP-39
#bip39Bitcoin Improvement Proposal 39. The standard for generating mnemonic seed phrases (typically 24 words) from a cryptographic seed. All current mainstream hardware wallets implement BIP-39.
BIP-85
#bip85Bitcoin Improvement Proposal 85. A standard for deriving child seeds from a master seed, allowing one hardware wallet to manage multiple independent wallets.
Shamir Secret Sharing (SLIP-39)
#shamirA cryptographic scheme that splits a seed into N shares, requiring K of them to reconstruct. Implemented in Trezor Safe-series and BitBox as an alternative to BIP-39 single-seed backup.
Multisig (m-of-n)
#multisigA wallet configuration requiring multiple signatures (m of n) to authorise a transaction. Common setups use diverse hardware wallets from different vendors to eliminate single-vendor-trust failure modes for high-value holdings.
Secure Element
#secure-elementA tamper-resistant cryptographic chip designed to store keys and perform signing operations in physical isolation from the host device. Common certifications: Common Criteria EAL5+, EAL6+.
Taproot
#taprootA Bitcoin protocol upgrade activated in November 2021 introducing Schnorr signatures and Merkleized Alternative Script Trees. Enables more efficient and private multisig and complex scripts.
EIP-4844 (proto-danksharding)
#eip4844An Ethereum protocol upgrade introducing blob-carrying transactions to reduce L2 rollup costs. Activated in March 2024 as part of the Dencun hard fork.
L2 / Layer 2
#l2A scaling solution built on top of a Layer 1 blockchain. Examples: Arbitrum, Optimism, Base, zkSync Era, StarkNet (Ethereum L2s); Lightning Network (Bitcoin L2).
Rollup
#rollupA specific Layer 2 architecture that bundles many transactions off-chain and posts proof or data to the L1. Optimistic rollups (Arbitrum, Optimism) assume validity; ZK rollups (zkSync, StarkNet) prove validity cryptographically.
Wallet-as-a-Service. A B2B model where embedded wallet infrastructure is provided to third-party applications. WaaS providers serving EU end-users may be CASPs under MiCA depending on their service profile.
Tax (9)
DAC8
#dac8Directive (EU) 2023/2226. Extends EU administrative cooperation in tax matters to crypto-assets. From 1 January 2026, EU CASPs must report client transactions to national tax authorities, which exchange information across the bloc.
Gewinnermittlung (DE)
#gewinnermittlungGerman tax-profit determination for crypto transactions. Under EStG §23, crypto sales within 12 months of acquisition are taxable as private sales income at the individual marginal rate; sales after 12 months of holding are tax-free for retail private investors.
PFU (FR)
#pfuPrélèvement Forfaitaire Unique. France's 30% flat tax on capital gains from occasional crypto sales by individuals. Active traders may be reclassified to BIC (Bénéfices Industriels et Commerciaux) progressive rates.
Patrimonio (ES)
#wealth-taxSpain's wealth tax (Impuesto sobre el Patrimonio). Net wealth above regional thresholds is taxed at progressive rates; crypto-asset holdings are included in the tax base at year-end fair-market value.
Cost basis
#cost-basisThe acquisition cost of an asset, used to calculate capital gains on disposal. EU jurisdictions vary on permitted methods: FIFO (DE default), HIFO (DE optional for crypto), specific identification (NL allows).
FIFO
#fifoFirst-In, First-Out. A cost-basis accounting method where the earliest-acquired units are deemed disposed of first. The default method for German private crypto disposals under EStG §23.
Wash-sale rule absence (DE)
#kraken-spvUnlike the US, German tax law does not impose a wash-sale rule on crypto disposals. Investors can realise losses by selling and immediately repurchasing without triggering loss-deferral. This is regularly used for end-of-year tax-loss harvesting.
Unrealised gains
#unrealised-gainsPaper gains on crypto holdings that have not been disposed of. In most EU jurisdictions, unrealised gains are not currently taxed. Spanish wealth tax is a notable exception (taxed annually on year-end fair-market value).
Crypto tax software
#crypto-tax-softwareTools that aggregate transaction data from exchanges, wallets, and on-chain history, then produce tax-compliant reports. Examples: Blockpit (DACH-focused), CoinTracking, Koinly, CoinLedger. Outside MiCA scope.