The Client Assets Sourcebook (CASS) is a set of rules from the Financial Conduct Authority (FCA) in the UK, designed to protect client money and assets held by regulated financial firms. In the context of crypto, CASS principles are applied to ensure segregation and safeguarding of digital assets and fiat funds held by institutional crypto exchanges, custodians, and brokers. Its objective is client protection.
Mechanism
CASS dictates operational requirements for client asset management, including stringent rules for reconciliation, record-keeping, and the establishment of separate client money and asset accounts. Firms must implement robust internal controls to prevent client assets from being commingled with firm assets or used to meet firm liabilities. This structure isolates client exposure from firm insolvency.
Methodology
The methodology emphasizes rigorous operational procedures and internal governance to ensure client assets are identifiable and returnable in the event of firm failure. For crypto systems architects, it mandates secure digital asset custody solutions, transparent audit trails for asset movements, and automated reconciliation systems to comply with these protective measures. Compliance maintains investor trust and market stability.
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