1. Introduction
nealthy (hereinafter referred to as the “Company”) takes very seriously its responsibilities towards transparency as set out by VARA. We wish to clarify the nature of services provided by the Company in relation to virtual assets (VAs) and offering broker-dealer services.
2. Best Execution and Routing
nealthy has in place systematic, transparent, and efficient policies concerning the execution and routing of client orders, which ensure optimal outcomes for our clients and are aligned with regulatory expectations.
2.1 OTC/Brokerage Services
Best execution is the term used to describe the obligation on nealthy to ensure that all reasonable steps are taken to achieve the most favourable terms for our client, when either executing trades or passing orders to be executed.
We commit to executing client orders at the best available prices, factoring in speed, likelihood of execution and settlement, size, and nature of the order. As such, all client orders are handled fairly and transparently. We will provide clear information about our order execution and routing processes.
For brokerage services, nealthy will act on behalf of its clients, routing their virtual asset orders to third party trading platforms. This routing follows a best execution model, as described above. The third party platforms involved are OTC desks and similar brokers, offering a wide range of trading opportunities. The executed prices confirmed by these external venues are the final prices for nealthy's clients, with an explicit fee charged for this service. This approach ensures transparency and competitive pricing.
For OTC services, nealthy will trade in its own name for its own account, acting as principal in transactions with clients. This means that clients' virtual orders are executed against nealthy's quotes within a bilateral trading relationship. Costs to clients in this model are implicitly embedded in nealthy's quotes, reflecting a different pricing strategy to the brokerage service.
2.2 Execution Factors
In processing client orders, nealthy considers a variety of factors to ensure optimal execution. These factors, known as "Execution Factors," include the order's price, cost, speed, size, likelihood of execution and settlement, the nature of the order, and other pertinent considerations.
The weight of these factors varies based on several "Execution Criteria," which encompass:The client's profile, including if they are a Qualified Investor;The specific details of the client's order, such as its size and scope;The attributes of the Virtual Asset (VA) being traded, particularly in terms of execution likelihood and speed;The features of the trading venues where the order could be placed.Unless directed otherwise by specific client instructions, our primary focus is generally on securing the best price. However, this does not undermine the significance of other execution factors. In certain situations, at our discretion, we may prioritize these other factors over price to achieve the most favourable outcome for our clients.Our approach to Best Execution does not involve comparisons with potential outcomes from other firms or variations in our own fees and commissions related to the nature of services provided to clients.
When our fees vary depending on the chosen execution venue or entity, we will provide clients with information to understand the pros and cons of selecting one venue or entity over another. In instances where clients are given the option to select the execution venue or entity, we ensure that the information provided is clear, fair, and not misleading. For the best possible results, when multiple competing execution venues are available, we will consider our own commissions and the costs of executing the order on each eligible venue.
nealthy will maintain a consistent fee structure across different execution venues to ensure cost transparency and full disclosure to clients. We offer a straightforward and transparent charging model, with a possible minimum trading fee. No additional commissions or costs are applied, except as explicitly stated. All implicit costs are disclosed for complete clarity and transparency to the client.
2.3 Execution Costs
In relation to costs/fees, nealthy will take into account the following factors:The cost of the financial instrument, including any bid/offer spread;Execution-related expenses, such as venue fees, clearing and settlement fees, and fees payable to third parties involved in the execution process;Any applicable financing costs.We adhere to the principle that all pricing should be fair, reasonable, and justifiable. The determination of what constitutes a fair and reasonable price takes into account various factors that influence the cost and resource constraints of conducting business. Any spread, markup, fee, or commission levied on an order under this policy will be equitable, without unfairly favouring certain Execution Venues over others.
2.4 Venues
nealthy may use numerous liquidity providers in order to provide the best possible service to our clients as outlined above. We will regularly monitor our relationships with liquidity providers to ensure that they are still the best option from a business perspective and a customer service perspective.
3. Scope of Services Related to other VASPs
The Company does not engage in the practice of holding or managing funds or virtual assets on behalf of any other VASPs, including those that provide broker-dealer services. Additionally, The Company does not offer clearing services for other VASPs engaged in broker-dealer activities.
4. Protection of Clients’ Ownership of Assets
nealthy is highly committed to ensuring the protection and safeguarding of client assets. Our approach is comprehensive and adheres strictly to the regulations set out by VARA. Key aspects of our policy include:
Segregation of Client Virtual Assets: Client virtual assets (VAs) are kept separate from nealthy's operational assets. This segregation prevents the use of client VAs for our operational or investment purposes, ensuring that client assets remain distinct and secure.
Security Measures: To protect segregated VA wallets, we employ advanced encryption, multi-signature authentication processes, and other cybersecurity best practices.
Auditing and Integrity Maintenance: Regular internal and external audits are conducted to maintain the integrity of segregated VA wallets, with any identified issues promptly addressed.
Asset Management and Reconciliation: Each client VA is maintained on a one-to-one basis, ensuring availability for transactions, risk management, transparent record-keeping, and efficient settlement processes.
Prohibition of Rehypothecation: We strictly prohibit the rehypothecation of client VAs, except with explicit client consent and compliance with applicable laws and client agreements.
Third-Party Deposits and Custody Agreements: When depositing client assets with third parties, we exercise due diligence in their selection and periodically review their performance and compliance.
Record Keeping and Reconciliation: We maintain accurate records of client assets and perform daily reconciliations to ensure transparency and accountability.
Compliance with VARA Regulations: We are committed to informing VARA promptly if there are discrepancies in our records or if we fail to comply with regulatory requirements.
Staff Training and Compliance: Our staff are thoroughly trained and supported to understand and implement this policy, ensuring compliance with regulatory requirements and the protection of client assets.
5. Referral and Introduction Practices
In adherence to our operational policies and regulatory compliance, we hereby confirm that the Company does not engage in the practice of referring or introducing our clients to other entities. This includes, but is not limited to, other virtual asset service providers (VASPs), financial institutions, or any third-party organizations.6. Senior Management and Board MembersThe Company hereby confirms that as of 15th January 2023, there have been no past convictions or prosecutions of any members of our Senior Management or Board. This statement holds true for proceedings both within the courts of the UAE and in other jurisdictions.
Our team members, especially those in senior management and on our board, adhere to the highest standards of professional conduct and ethical behaviour.For further details or inquiries regarding our services, please contact our support team: support@nealthy.com