AI Summary of Article 3 Definitions
This Regulation sets forth essential definitions concerning distributed ledger technology (DLT) and crypto-assets. Key terms include 'distributed ledger', which serves as a synchronised record of transactions across a network, and various crypto-asset types, such as asset-referenced tokens and electronic money tokens, which are indexed to stable values.
Moreover, the text delineates responsibilities of crypto-asset service providers, the nature of regulatory compliance, and establishes frameworks for governance and operational protocols. Entities involved in crypto-assets must ensure adherence to specified regulatory guidelines, facilitating the integrity and security of financial transactions.
Article 3 Definitions
1. For the purposes of this Regulation, the following definitions apply:
(1) 'distributed ledger technology' or 'DLT' means a technology that enables the operation and use of distributed ledgers;
(2) 'distributed ledger' means an information repository that keeps records of transactions and that is shared across, and synchronised between, a set of DLT network nodes using a consensus mechanism;
(3) 'consensus mechanism' means the rules and procedures by which an agreement is reached, among DLT network nodes, that a transaction is validated;
(4) 'DLT network node' means a device or process that is part of a network and that holds a complete or partial replica of records of all transactions on a distributed ledger;
(5) 'crypto-asset' means a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology;