Regulatory position statement

This Regulatory Position Statement explains how Layer Flow Gateway (“LFG”) operates, the nature of our services, and how we remain compliant with applicable laws in the jurisdictions where we operate.

LFG provides non-custodial software that enables individuals and businesses to send, receive, and manage digital-asset payments directly between their own wallets. We do not hold, control, or access user assets or private keys. All transfers occur on public blockchain networks under the user's sole control.



We provide optional compliance, analytics, and automation features (for example, address screening, transaction monitoring, and risk scoring) to help users meet their own obligations. These are provided as software tools only and do not constitute regulated financial, exchange, or payment services.



Our business model is software-as-a-service (“SaaS”), offered globally except in restricted jurisdictions (including the United States, mainland China, Nigeria, and sanctioned regions).



Licensing & Compliance Position


We do not act as a Virtual Asset Service Provider (VASP), Payment Service Provider (PSP), or Electronic Money Institution (EMI). We do not issue, redeem, or manage e-money or virtual assets, and we never take custody, possession, or control of user funds or private keys. All transactions occur directly on public blockchains between users’ own wallets.



Risk-Based Controls (Non-Custodial Compliance)


LFG employs risk-based anti-money-laundering (AML), counter-terrorist-financing (CFT), and sanctions controls consistent with applicable law. We use regulated third-party providers for identity verification (KYC/KYB) and continuous transaction monitoring to identify irregular or high-risk activity.



When suspicious behaviour or sanctioned exposure is detected, LFG may suspend or restrict access to Services while cooperating with competent authorities. Because LFG never holds user assets, we cannot freeze or reverse funds; our compliance actions are limited to platform-level restrictions and reporting.



Use of Credits (In-App Units)


LFG subscriptions operate on a credit-based model. Credits are a non-monetary accounting mechanism used solely to measure access to defined software features (for example, a set number of transactions, compliance checks, or requests).



Credits do not represent money, stored value, or virtual assets, and cannot be redeemed, withdrawn, exchanged, or transferred. They exist purely within the software environment and are consumed when a user performs a defined action.



This structure ensures that no funds, tokens, or redeemable balances are held, transmitted, or issued by LFG. As such, the credit system does not fall within the scope of e-money, stored-value, or virtual-asset service provider regulation under applicable laws.



Operational Controls


LFG employs regulated third-party providers for identity verification (KYC/KYB) and transaction risk screening, ensuring compliance with anti-money-laundering and counter-terrorist-financing laws. We block access from restricted jurisdictions and do not promote or distribute our app in the United States, mainland China, or other sanctioned regions. Our onboarding systems automatically prevent users from these jurisdictions from completing identity verification or accessing our Services.



We cooperate with law enforcement and regulatory authorities where required and maintain full audit trails for compliance and transparency purposes.



Disclaimer


This statement is provided for regulatory clarity only. It does not constitute legal, financial, or compliance advice and may be updated as laws and regulatory expectations evolve.



Contact


For regulatory or compliance enquiries, contact:
 [email protected].