MEDRE’s Role as an ART (Asset-Referenced Token)

Under MICA, MEDRE’s primary role is as an issuer of asset-referenced tokens (ARTs). This means that MEDRE is responsible for creating and distributing tokens that are linked to the value of its underlying real-world assets (RWAs) – in this case, the portfolio of Mediterranean hotel and hospitality properties. Here’s a breakdown of MEDRE’s key responsibilities under MICA:  

Issuance and Transparency: MEDRE must comply with MiCA’s rules on the issuance of ARTs, including providing clear and accurate information to investors about the token, the underlying assets, and the associated risks. This includes publishing this whitepaper that meets MICA requirements. MEDRE is committed to meeting MiCA’s stringent transparency requirements, including publishing this whitepaper that clearly outlines the project’s vision, technology, and tokenomics. This whitepaper will be regularly updated to reflect any material changes in the project or its operations. In addition to the whitepaper, MEDRE will provide investors with clear and accurate information about the token, the underlying assets, and the associated risks through our website, investor portal, and regular communication channels such as newsletters and email alerts.  

Asset Safeguarding: MEDRE must ensure the safekeeping of the RWA portfolio that backs the tokens. This includes having appropriate security measures in place to protect the assets from damage, destruction, fraud, misappropriation, or legal disputes. The safekeeping of the RWA portfolio is a top priority for MEDRE. To protect these assets, MEDRE will implement a comprehensive security strategy that includes physical security measures such as surveillance systems and access controls at all properties, cybersecurity measures such as firewalls, intrusion detection systems, and encryption to protect against cyberattacks, and robust access controls to prevent unauthorized access to sensitive data and systems. Additionally, MEDRE will conduct thorough due diligence and title searches before acquiring any property, and will maintain appropriate insurance policies to cover potential risks.

Reserve Management: MEDRE will maintain adequate reserves to ensure it can meet its obligations to token holders, such as the payment of dividends. It’s important to note that MEDRE will not offer a token redemption program in the initial stages of the project. Liquidity for token holders will be primarily provided through secondary market trading on cryptocurrency exchanges. The reserve of stablecoins will be managed according to a clear policy that outlines the criteria for adjusting the reserve size based on factors such as market conditions and the value of the underlying assets. Reputable custodians will be used to hold the stablecoin reserve, and regular audits will be conducted to ensure transparency and verify that the reserve meets the minimum requirements. MEDRE may also consider using a portion of the reserve for token buybacks or burning to stabilize the token price or reduce circulating supply, with any such decisions made through a transparent process and communicated clearly to investors.

Compliance with Regulations: MEDRE must comply with all applicable MICA regulations, including those related to investor protection, anti-money laundering (AML), and combating the financing of terrorism (CFT). MEDRE is dedicated to upholding the highest standards of regulatory compliance and will actively monitor and adhere to all applicable MiCA regulations, including those related to investor protection, anti-money laundering (AML), and combating the financing of terrorism (CFT). This includes implementing robust KYC/AML procedures, ensuring data privacy, and maintaining market integrity.  

Disclosure and Reporting: MEDRE must provide regular disclosures and reports to token holders and regulatory authorities, including financial statements and information on the performance of the RWA portfolio. Transparency and accountability are core values at MEDRE. To uphold these values, MEDRE will provide regular disclosures and reports to token holders and regulatory authorities, including financial statements, information on the performance of the RWA portfolio, and updates on key project developments. These disclosures will be made through accessible channels such as our website and investor portal, and will be communicated clearly and regularly to ensure investors have the information they need to make informed decisions.  

It’s important to note that while MEDRE is not a CASP (Crypto-Asset Service Provider), it still falls under the scope of MICA because it is issuing ARTs.

This means MEDRE must comply with the relevant provisions of MICA that apply to ART issuers. By fulfilling these responsibilities, MEDRE can ensure it operates in a compliant and transparent manner, building trust with investors and contributing to the healthy development of the crypto-asset market.