MiFID II is a key European regulation in the field of financial investments. Its main objective is to protect investors, guarantee transparency in the financial markets and regulate the entities that offer investment services. TokenKey, as a platform regulated under BaFin, complies with the requirements of MiFID II, ensuring that investments are safe, clear and protected.
In this article, we will explain in simple terms what MiFID II is, how it works and what it means for investors in TokenKey.
What is MiFID II?
MiFID II (Markets in Financial Instruments Directive II) is the second version of the European Union's Markets in Financial Instruments Directive. It came into force on 3 January 2018, extending and improving the previous regulation (MiFID I) to adapt to the evolution of the financial markets and the digitalisation of investments.
Main objectives of MiFID II
Greater protection for investors: Requires financial companies to act in the best interests of their clients.
Greater transparency in financial products: Requires clear and detailed information on the risks of each investment to be provided.
Stricter supervision: Introduces controls and regulations to prevent fraud and conflicts of interest.
Classification of investors: Differentiates between retail, professional and institutional investors to adapt protection to their level of experience.
Regulation of financial advice: Requires investment recommendations to be appropriate for each investor profile.
How does MiFID II protect investors?
1. Classification of investors
MiFID II establishes three categories of investors, each with a different level of protection:
Retail investors: Receive the highest protection and must receive detailed information before investing.
Professional Investors: It is assumed that they have experience in the markets and they receive a lower level of protection.
Financial Institutions: Entities with extensive knowledge and activity in the financial markets.
2. Clear and transparent information
Companies regulated by MiFID II must provide detailed information on:
The risks of the investment.
The expected return.
The applicable costs and commissions.
The rights and responsibilities of the investor.
3. Prevention of conflicts of interest
Controls are established to prevent financial institutions from recommending products that benefit the company more than the investor. This ensures that clients receive impartial advice tailored to their needs.
4. Protection against fraud and malpractice
MiFID II imposes strict audits and controls on investment platforms to ensure that they operate ethically and securely. In addition, it requires the implementation of Anti-Money Laundering (AML) measures.
How does TokenKey comply with MiFID II?
TokenKey, in collaboration with its partners, operates and complies with MiFID II, ensuring that each investment is secure, transparent and compliant with European regulations.
The guarantees offered by TokenKey include:
Clear and detailed information about each investment.
Compliance with KYC (Know Your Customer) and KYB (Know Your Business) processes to guarantee the legality of investments.
Classification of investors according to MiFID II to adapt the level of protection.
Constant supervision and audits to ensure transparency and security of operations.
MiFID II is a key regulation for the protection of investors and the proper functioning of financial markets in Europe. Thanks to this regulation, investors in TokenKey can count on a secure and transparent environment that is tailored to their needs.
If you have further questions about MiFID II and its impact on your investment, please consult with our team or review the information available on our platform.