601 | DLT Academy | End-to-End Investor Journey

‍

1. Introduction: Structuring the Investor Experience for Regulated Digital Offerings

Institutional investors engaging in digital securities require more than an on-chain wallet they require a legally grounded, risk-aware investment process supported by identity verification, suitability checks and secure token receipt infrastructure. For tokenized products issued under Swiss FinSA and within the EU MiFID II/MiCA framework, this journey must be structured, auditable and regulator-ready.

This module details the full investor lifecycle across digital offerings, from initial access to post-issuance engagement. The process spans legal documentation, digital onboarding, secure custody configuration, compliant asset delivery and real-time visibility into holdings and revenue entitlements.

2. Key Phases of the Institutional Investor Lifecycle

A. Phase 1: Access & Legal Eligibility Verification

Investor access is gated by applicable private placement exemptions and regulatory segmentation.

Jurisdictional Filters: Investors must reside in jurisdictions where the offering is permitted under FinSA Art. 36 or equivalent EU exemptions.

Investor Category: Only professional and institutional investors (including family offices, qualified investors, funds, or corporations) may participate.

Offering Disclosure: Access is granted following acceptance of the offering memorandum or term sheet, including risk factors and legal disclaimers.

U.S. investors are categorically excluded to preserve jurisdictional compliance.

Eligibility is enforced at both the website/application layer and the smart contract delivery logic.

B. Phase 2: AML/KYC Onboarding & Suitability

Upon accessing the platform, the investor completes a structured onboarding process.

Identity Verification (KYC): Passport or national ID checks, liveness tests and address confirmation through trusted providers (e.g., SumSub, Onfido).

AML Screening: Sanctions list screening, source of funds validation and PEP checks.

Suitability Assessment: Investment knowledge and risk tolerance assessment to comply with FinSA and MiFID II obligations.

Investment Agreement: Execution of digital subscription forms and terms of participation via electronic signature.

Only approved investors are assigned a unique digital investor profile and eligible wallet address.

C. Phase 3: Wallet Whitelisting & Token Readiness

Investors are required to prepare a compatible wallet environment to receive digital securities.

Wallet Type: XRPL-compatible non-custodial wallet (e.g., Xaman, Ledger Nano, or institutional MPC-based custody).

Trustline Setup: Investors must establish a trustline with the issuer’s token to receive it.

Wallet Verification: Only wallets verified through onboarding and matched to the investor profile are whitelisted.

Ineligible Wallets: CEX (centralized exchange) addresses or unsupported custodial services are rejected to prevent token loss.

Once wallet setup is verified, the investor is entered into the issuance queue.

D. Phase 4: Token Allocation & Digital Delivery

Token allocation is executed based on approved subscription and series class.

Smart Contract Issuance: Tokens are minted via XRPL IOU logic and distributed directly to whitelisted investor wallets.

Lock-Up Management: If applicable, tokens are time-locked using XRPL freeze functions or on-chain vesting mechanics.

Series Differentiation: Investors receive tokens with metadata or sub-logic reflecting class-specific rights (e.g., lock-up expiry, priority in revenue sharing).

Settlement Confirmation: Investors receive transaction hash and smart contract record confirming asset receipt.

The delivery process is immutable, auditable and irreversible underscoring the need for correct wallet setup.

E. Phase 5: Post-Issuance Visibility & Ongoing Rights

After receipt of tokens, investors are provided with dashboards and documentation to monitor their investment.

Investor Portal: Secure login access to performance metrics, token balance and distribution history.

Revenue Distributions: Profit-sharing or income events are processed on-chain to verified wallets per defined cycles (e.g., quarterly).

Governance Events: Investors may participate in voting, buyback elections, or capital call approvals (if applicable).

Audit Trail: Each distribution and token movement is recorded on-chain for full transparency.

Ongoing Support: Institutional helpdesk and compliance response teams assist with wallet recovery, reporting, or tax documentation.

The issuer maintains real-time registry visibility and can enforce compliance triggers (freeze, revoke) where required by law or agreement.

3. Real-World Integration Example

Product: GXFlex – Revenue-sharing token
Offering Type: Private placement under FinSA Art. 36

Onboarding Flow:

1. Investor accesses GXFlex data room and signs risk acknowledgment
2. Completes KYC/AML with SumSub and suitability form
3. Submits Xaman wallet and establishes trustline
4. Token issued to wallet, subject to 12-month lock-up
5. Accesses dashboard quarterly for profit distribution updates
6. Submits audit report request via dashboard for annual financial review

4. Summary: Key Takeaways

• Only institutional/professional investors outside the U.S. are eligible for regulated digital securities offers under GX’s private placement structures
• Onboarding must satisfy KYC, AML and suitability standards under Swiss and EU frameworks
• Wallet setup is investor-specific, trustline-based and strictly whitelisted
• Token delivery is executed via smart contracts with lock-up, governance, or payout logic embedded
• Post-issuance rights include transparent revenue distributions, access to reporting and regulated redemption paths

5. Next Steps & Related Modules

Continue to: Module 6.2 – Investor Lifecycle Management
Explore how tokens evolve post-issuance, including rights updates, transfer restrictions and exit logic.

Recommended: Module 6.5 – Capital Calls & Cash Flow Automation
Understand how RWA-backed tokens handle milestone-based disbursement and dynamic investor funding.

Supplementary Resource - Wallet Setup Checklist for Professional Clients

‍

Discover how GX Securities leverages the XRP Ledger for compliant DeFi infrastructure and tokenized asset operations visit www.gxsecurities.com | Institutional DeFi on XRPL | GX Securities Blog

Contact us at compliance@gxsecurities.com or send us an inquiry

‍Disclaimer: GX Securities operates solely as a DLT infrastructure provider and this article does not constitute financial advice or an offer of securities.