Global Glosssary: Includes FCA Definitions & Handbook references

Liquidity mining is an investment strategy used to earn passive income with crypto assets. Investors stake their crypto assets in a liquidity pool to provide traders with the liquidity to conduct transactions. In exchange, investors receive a portion of the trading fees.

In the liquidity mining scam, victims move cryptocurrency from their wallets to the liquidity mining platform and see the purported returns on a falsified dashboard^[1]. Believing their investments to be a success, victims purchase additional cryptocurrency. Scammers ultimately move all stored cryptocurrency and investments made to a scammer-controlled wallet.

A smart contract arrangement in DeFi that holds two or more cryptoassets to enable financial activity to take place, such as trading or lending

Scammer broadcasts a livestream event through an online streaming platform (e.g., YouTube) to market a fraudulent promotion or product. Promotions typically offer questionable terms that are too good to be true and may request payment through crypto assets.

Local authority security any of the following:

(a) a non-readily realisable security or non-mass market investment (other than a unit in an unregulated collective investment scheme) issued, or to be issued, by a local authority;

(b) a P2P agreement entered, or to be entered, into by a local authority as borrower;

(c) a P2P portfolio consisting exclusively of agreements entered, or to be entered, into by one or more local authorities as borrower.