Part IV: Principles for Cryptoasset Funds and Fund Managers
The GDF Code of Conduct has in part been developed in response to a desire among the GDF community to establish and maintain the credibility and accountability of participants in the cryptoasset ecosystem. And to that end, the fourth section of the Code outlines the principles that cryptoasset funds and fund managers should adhere to to enforce consumer protections.
The Code is aimed at building trust between investors and fund managers by establishing rules for acting honestly, fairly and in the best interest of investors and the integrity of the market. From an ethical perspective, the Code helps define which details, such as fund documentation and financial risks, are critical and should be provided to investors to ensure total transparency when making financial decisions.
The Code also outlines that policies will be put in place to avoid conflicts of interest and to ensure that investors are fairly treated, including full disclosure of matters that could affect fund managers’ independence and objectivity.
Focus on documentation
The GDF community believes that all relationships between fund managers and external services providers and counter-parties should be officially documented. To ensure that the customer’s assets are kept safe, we are committed to disclosing key information such as the administrator, external auditor and depositary. Moreover, we will document the scope of responsibility and liability of the providers. Other practices such as know your customer (KYC) and customer due diligence (CDD) have also been put in place to comply with anti-money laundering, counter-terrorist financing sanctions and anti-bribery laws.
The Code also provides guidance on accounting and valuation, stating that fund management must be independent of internal and external financial results. With any results we get, whether it be from the net asset value (NAV) calculation or money raised from cryptoassets, we offer full transparency and clear explanations to all of our investors.
Moreover, to mitigate insider trading and market abuse, the Code works to uphold the highest principles of integrity. It outlines policies to minimise the risk of unsolicited information, practices that are designed to artificially manipulate the price of tokens and trading ahead of the fund in personal or firm accounts. The GDF community makes it clear that there should be no trading if non-public or insider information is received.
Current principles reflect the matters that are believed to be most material. However, we anticipate these principles will continue to evolve to reflect the latest developments in the industry. Therefore, the GDF Code of Conduct is a living document, and we are open to feedback from the community on any additional matters that should be included.
Read Part IV of the Code in full:
