Custody in the Language of the Law — What Virtual Asset Service Means
The Organic Law of Georgia on the National Bank of Georgia defines a virtual asset as a digital expression of value that is interchangeable and not unique, is the subject of digital transfer or trading and is used for investment and/or payment purposes. A convertible virtual asset is a virtual asset that has an equivalent market value in national or foreign currency, in another virtual asset or in a financial instrument. The whole category system for services is built around convertible assets, and custody is one of its central categories.
The law recognises as virtual asset service: the exchange of convertible virtual assets (including through self-service kiosks) into currency, other assets or instruments; transfer; and the storage/administration of a convertible virtual asset or of the instruments required to use it, which give control over the asset; as well as portfolio management (other than collective portfolio management), administration of a trading platform, lending of the asset and services around an initial offering. For a custody business model the decisive formula is “storage/administration that gives control over the virtual asset” — it determines that managing private keys and administering other control instruments fall under the same regime. A VASP is a person that provides such services for the benefit of another person.