> ## Documentation Index
> Fetch the complete documentation index at: https://docs.cryptocheckout.ai/llms.txt
> Use this file to discover all available pages before exploring further.

# MiCA position

> Why the architecture is shaped the way it is, and the hard bans that follow from it.

Full analysis: `docs/MICA_REGULATORY_POSITION.md`. Supporting opinions: `docs/LEGAL_OPINION_GLOBAL_DISTRIBUTION.md`, `docs/LEGAL_OPINION_ADDENDUM_SKN_vs_BVI.md`.

<Warning>
  Counsel sign-off is a **mainnet gate** and has not been obtained. Nothing here is legal advice, and the position is not settled until counsel confirms it.
</Warning>

## The core argument

Custody is what makes a service a regulated crypto-asset service. The architecture is built so that the platform never has it — not as a policy, but as a property of the code.

| Capability                           | Platform has it                                          |
| ------------------------------------ | -------------------------------------------------------- |
| Hold customer or merchant funds      | No                                                       |
| Redirect a settled payment           | No — recipients frozen in pool bytecode                  |
| Redirect a payment before it settles | No — client verifies destination on-chain before signing |
| Block, delay, or condition a payout  | **No — and this must stay true**                         |
| Convert between crypto and fiat      | No — hard ban                                            |

The third row is the unusual one and it is why [DB-display-only trust](/trust/db-display-only) matters legally as well as technically.

## The permissionless linchpin

`distribute()` is callable by anyone. The settlement spec names this **the regulatory linchpin**.

<Danger>
  Any mechanism that lets the platform withhold a merchant's funds — a debt gate, a compliance hold, an operational pause — hands us a capability a regulator will read as custody, whether or not we ever exercise it. This has already been the deciding argument against one proposal that was otherwise economically neutral.
</Danger>

The practical rule that follows: money owed to the platform is recovered as a **bounded fee inside the split**, never as a gate on the payout.

## Hard ban: fiat on-ramps and off-ramps

<Danger>
  **Never touch, integrate, recommend, or document fiat on-ramps.** MiCA's "facilitating the conversion" language is broad enough that even a soft recommendation pulls the platform toward CASP scope.
</Danger>

This applies to every public surface, including casual mentions in help text, blog posts, and support replies. Stay strictly on-chain.

## Sanctions screening is not a regulated service

Screening is an identity-blind list lookup. Refusing service to a sanctioned wallet is the **negation** of a service, not the provision of one, and it is not a crypto-asset service under Article 3(1).

It is also explicitly **not KYC** — no identity is collected, verified, or stored, and payer verdicts are never persisted. See [Sanctions](/compliance/sanctions).

## Communications discipline

The trust guarantee is real but conditional, and overstating it creates both legal and reputational exposure.

<Warning>
  **Never claim "unhackable."** Describe the mechanism and the conditions. The non-absolutist communications floor applies to every public statement.
</Warning>

State these conditions whenever the routing claim is made:

* It holds only when the merchant **pins an anchor**. Without one, the widget shows an unverified badge and does not block.
* It defends the **database-compromise** threat. A full served-code compromise is mitigated by SRI-pinning, not eliminated.
* It covers the **pool rails**. The legacy atomic rail is a separately tracked gap.
* The **audit is pending**.

The same discipline applies to fees. The site advertised "keep 99%" while merchants actually kept 98.505%; that required a correction and a regression test. Publish numbers that survive arithmetic.

## Mainnet gates

Four items, none of them engineering:

<Steps>
  <Step title="Third-party security audit">
    Of the pool rails, not just the legacy contracts.
  </Step>

  <Step title="Immunefi bug bounty live">
    Before real money is at risk.
  </Step>

  <Step title="MiCA counsel sign-off">
    On the custody position and the marketing claims.
  </Step>

  <Step title="Explicit per-chain GO">
    From the founder. Guardrail number one. No agent or automation may broadcast to a mainnet.
  </Step>
</Steps>

## Positioning

Supported stablecoins are **USDC, USDT, and EURC as equal options**, with no geographic slant. EURC being the current default for new merchants is a configurable database value, not a market position.

Do not describe the product as "Europe-first" or "EUR-first" on any user-facing surface. The default currency is likewise a configurable default, not a stance.

## Related programme documents

`docs/OFAC_COMPLIANCE_PROGRAM.md` covers the operational compliance programme. `docs/sprint0/TREASURY_SAFE_SPEC.md` covers treasury custody arrangements, which are a separate question from customer fund custody.