Crypto Asset Management Firm Tesseract has a markets in Crypto-Assets Regulation (MICA) permit from the Finland’s Finance Supervision Authority protected, which offers EU investors regulated, managed revenue generating services via Defi-Protocols.
With Tesseract’s Mica license, the company established in Helsinki can be able to offer portfolio management, custody and assets for both retail and institutional investors, shared with the Defiant according to a press release.
Regarding investment thresholds, Tesseract Group James Harris said in comments for the Defiant that there is no minimum for retail users. For business treasury, starting deposits usually start around $ 1 million. The company says that the license makes it the first regulated European entity “to offer services that generate proceeds via active portfolio management in Defi protocols.”
According to its website, Tesseract has more than $ 500 million in assets under management and has yielded $ 20 million in return on fifteen crypto assets.
Mix of strategies
The Tesseract Defi -Product managed investments about the yield of the yield, loans, deployment, liquidity provision and arbitration on the by Vetted Defi protocols, while the team adapts allocations to manage and respond to changing market conditions.
When asked how Tesseract decides which Defi protocols or strategies they include in the managed Defi portfolio, Harris did not give a detailed explanation, and only said that the company maintains a risk management frame.
“We maintain a rigorous framework for portfolio and risk management and actively follow assets and market events. Our managed Defi products use an actively managed, various mix of strategies that are all aimed at optimizing risk stretching ratios with a high level of transparency,” Harris said.
Navigating by ambiguity
Mica, the radical regulatory framework of the EU for Crypto, came into full force in December 2024, and determines the EU-wide requirements and regulatory clarity for crypto companies or Crypto Asset Service Providers (CASPs) in the region.
Tether decided not to pursue a mica-compliance yet restrictions such as keeping reserves in European banks would require EU-regulated platforms that cancel USDT, by far the largest and most popular Stablecoin worldwide. However, other companies have developed mica-conforming products, such as the Eurøp Stablecoin, although the adoption is still left with the US dollar-supported rivals.
Mica and Defi
Although Mica mainly regulates centralized entities, its application to Defi is less clear. The Regulation excludes services “in a fully decentralized way without an intermediary”, but the definition of “fully decentralized” remains ambiguous. As Makerdao co-founder Rune Christensen suggested in an X-message in April 2024, only “fully decentralized, local, downloaded frontends or full-kyc online frontends would be possible” under Mica.
Tesseract indeed notes that it attaches itself to “strict AML/KYC-Compliance” and the managed production-generating product is closer to a centralized exchange than a strict Defi-Native platform.
About the management of smart contract and counterparty risk, Tesseract’s Harris explained that the company invested in institutional quality compliance and risk management, including CASP registration and ISO27001/SOC2 certifications, which are international standards showing that a company has solid controls of sensitive information and the management of sensitive information.
He emphasized that Tesseract protects client assets by thorough due diligence, colland requirements based on credit protection and by placing funds in fully separate legal entities, so that the participations of each customer are isolated from the balance of the company and other customers. On the Defi side, “designs and monitors allocations, performs stress tests and dashboards and offers transparent monthly reporting and certificates.”
Tesseract was founded in 2018 and collected $ 25 million in Series A Financing Round in 2021, led by Augmentum Fintech, and with the participation of, among others, Coinbase Ventures, Wintermute and Woorton.
