FinToken XArchitectureSecondary Investor
Secondary Market Investor
The professional investor who buys slices of already-funded receivable tokens from a lender and trades them on the secondary market. Strictest gate set on the platform — Markets in Financial Instruments Directive II (MiFID II) classification + a pre-trade compliance check on every single trade. Retail prohibited, by law, not by policy.
Why the gate set is strictest
Investors are the only persona who buy a security after it exists. That changes the legal posture in three ways the platform has to honour.
- MiFID II classification is mandatory. A retail investor cannot trade these tokens. Misclassification is the single biggest enforcement risk for a Sandbox-licensed venue.
- Pre-trade compliance is required for every trade. Sandbox terms call this out explicitly: a 7-question checklist signed off and logged before each trade, exportable to the regulator on demand.
- Source-of-funds is checked harder than for any other persona. An investor who bought a slice with money of unclear origin lets dirty funds enter the receivable supply chain. The Form D onboarding asks for the actual fund vehicle, the prospectus, and the latest audited accounts.
Flow map
| Step | What the investor sees | Channel | State event |
|---|---|---|---|
| I1 | Sign up, choose role | Browser | SUBJECT_CREATED |
| I2 | Onboarding (Form D — Know Your Business (KYB), fund vehicle, source of funds, audited accounts) | Browser | ONBOARDING_SUBMITTED |
| I3 | MiFID II classification (Professional / Eligible Counterparty (ECP) / Retail) | Browser | MIFID_CLASSIFIED |
| I4 | Gates 1–3 + Money Laundering Reporting Officer (MLRO) sign-off | RISK_PASSED | |
| I5 | Welcome — secondary market access | Email + dashboard | SUBJECT_ACTIVE |
| T1 | Discover · secondary market listing | Browser + API | — |
| T2 | Inspect a slice | Browser | — |
| T3 | Pre-trade compliance check (7 questions) | Browser | PRE_TRADE_LOGGED |
| T4 | Accept the trade | Browser + API | TRADE_EXECUTED |
| T5 | Token transfer + cash settlement | TRADE_SETTLED | |
| T6 | Hold to maturity (or sell on) | Browser | — |
Onboarding · I1–I5
7–14 business days. Bottleneck is Form D — investor onboarding asks for the actual fund vehicle, the prospectus or scheme rules, and the most recent audited accounts. MLRO review is mandatory regardless of risk grade.
I3
MIFID_CLASSIFIED
MiFID II classification
A specialised step inside Form D. Faisal must qualify as either Professional (large firm meeting two of three quantitative tests) or Eligible Counterparty (very large firm or specific regulated entity). If he can't, the platform politely declines.
🔒 app.fintokenx.uk/investor/classification
MiFID II classification — Brunel Pension Partners
Trading invoice tokens on this venue is restricted by law to professional investors and eligible counterparties.
Eligible Counterparty test
- ☑ Authorised credit institution, investment firm, insurance company, UCITS / AIF, pension fund or pension fund manager (Financial Conduct Authority (FCA)-registered)
- ☑ National government, supranational organisation, central bank, public debt body
Brunel is a Local Government Pension Scheme pool. Eligible Counterparty
Professional Investor test (alternative)
Two of these three must be true:
- ☑ Carried out trades, in significant size, on this market on average 10 per quarter over the previous four quarters
- ☑ Financial instrument portfolio > €500,000
- ☑ Worked, or works, in the financial sector requiring knowledge of these instruments for at least one year in a professional capacity
Retail · NOT permitted
If you do not qualify under either test above, you are classified as Retail and cannot trade on the FinToken X secondary market. This is a UK law (MiFID II as adopted into UK FCA Handbook), not a policy choice. Find a regulated retail venue.
Per-trade · T1–T6
The hot loop. Every trade — buy or sell — passes through the same six steps. The pre-trade check at T3 is the regulator-facing artefact that distinguishes Sandbox-licensed venues from unregulated tokenised-RWA platforms.
T1
Secondary market · /investor/marketplace
Listings come from lenders who hold funded receivables and want to free up capital. Brunel sees only listings filtered against its appetite (tenor, sector, single-name concentration).
🔒 app.fintokenx.uk/investor/marketplace
Receivable slices on offer
Already-funded receivables. Buy a slice; hold to maturity or sell on.
Slices listed
408
Avg yield-to-maturity
2.18%
Brunel exposure
£14.2m
Mandate headroom
£35.8m
Token
Originator
Obligor
Slice
YTM
Days to maturity
FXR-INV-23A4F /5
Coppergate Joinery
Northwind Retail public limited company (plc)
£2,000.00
2.42%
53d
›
FXR-INV-22Y91 /10
Halton & Crane
Yorkshire Schools
£1,892.00
2.18%
38d
›
FXR-INV-22A88 (whole)
Stratton Logistics
Northwind Retail plc
£3,420.00
2.62%
52d
›
Slice notation:
FXR-INV-23A4F /5 means the receivable token has been fractionalised into 5 equal slices and what's listed is one slice. Lenders fractionalise on the fly; the chain compliance module enforces that the sum of slices equals the total face. Whole-token listings are rarer — typically a lender exiting a position because of concentration limits.
T2
Inspect the slice
Click into a listing. Faisal sees the full provenance — original lender, original underwrite date, originator history, obligor history. He does not see the seller's bank account or the platform fee (per money-control rules 1 + 6).
🔒 app.fintokenx.uk/investor/marketplace/FXR-INV-23A4F-S2
FXR-INV-23A4F · slice 2 of 5
£2,000.00 face · 53 days to maturity · 2.42% YTM
Originator · Coppergate Joinery Limited (Ltd)
14 invoices financed · 0 disputes · 12 months on platform · LOW risk grade
Obligor · Northwind Retail plc
142 invoices confirmed · 3 disputes (resolved) · D&B 9A1 · FTSE 250
Original underwrite
Funded by Pennine Asset Management on 22 May 2026 at 2.40% over 60 days. Buyer-confirmed, vision-checked, MLRO-cleared. View provenance.
Pricing
Face on settlement
£2,000.00
Asking price
£1,991.50
YTM (53d)
2.42%
T3
FCA / Bank of England (BoE) Sandbox
PRE_TRADE_LOGGED
Pre-trade compliance check
The 7-question checklist required by the Sandbox programme. Every answer logged with timestamp, IP, and the actor's subject ID; exportable as evidence on regulator request. If any answer is "no", the trade is blocked.
🔒 app.fintokenx.uk/investor/trade/FXR-INV-23A4F-S2#pre-trade
Pre-trade compliance check
7 questions · Required for every trade by the FCA / BoE Digital Securities Sandbox (DSS). Answers are logged.
1
Is your firm's MiFID II classification still current and unchanged since onboarding?
2
Has any director, trustee, or beneficial owner of your firm been added to a sanctions list since onboarding?
3
Is the source of funds for this trade consistent with what you declared on your Form D?
4
Will this trade breach any concentration or exposure limit your firm has set?
5
Have you reviewed the receivable's full provenance (originator history, obligor confirmation, original underwrite)?
6
Are you trading in the capacity authorised on your account, and not on behalf of an undisclosed third party?
7
Do you confirm this trade is not part of a market-manipulative or layering pattern?
What happens if any "No": the trade is blocked at this step. Question 2 routes to the MLRO queue immediately. Question 3 routes to source-of-funds re-verification. Question 7 routes to the market abuse log.
Architectural note: the pre-trade check is enforced by
ComplianceGateGuard action="SECONDARY_MARKET_TRADE" wrapping the TradeAcceptPage route. If the check is satisfied client-side but missing on the server log, the server returns 409 PRE_TRADE_REQUIRED and the trade fails closed. Future-proofing: this check belongs in the central guard, not on the Investor page itself, so any additional trading entry point inherits it automatically. Regulator export: /compliance/pre-trade renders the running log; a CSV export is signed and available to FCA Sandbox staff via the audit-export endpoint.
T4
TRADE_EXECUTED
Accept & settle
Single button. Behind it: chain transfer of the slice token from Pennine's wallet to Brunel's wallet (running through the on-chain compliance modules); fiat leg from Brunel's bank to Pennine's via FinToken X collections.
🔒 app.fintokenx.uk/investor/trade/FXR-INV-23A4F-S2
Confirm trade · FXR-INV-23A4F slice 2
Buying
1 slice (£2,000 face)
Paying
£1,991.50
Settles on
21 Jul 2026
T5
TRADE_SETTLED
Trade settled · email
On-chain transfer + fiat leg both confirmed. Brunel now holds the slice token; Pennine has received the cash.
FinToken X · transactional
FromFinToken X <noreply@fintokenx.uk>
Tof.quereshi@brunelpp.co.uk
SubjectTrade settled · FXR-INV-23A4F slice 2
Trade settled ✓
Faisal,
£1,991.50 has been remitted from your designated account to the seller. Slice FXR-INV-23A4F-S2 is now held in Brunel's wallet on the FinToken X Network.
View portfolio
T6
Portfolio & hold-to-maturity
Faisal tracks the slice through to settlement. On the maturity date, Brunel receives £2,000.00 and the slice token is burned — same burn semantics as the lender flow, just for the slice.
🔒 app.fintokenx.uk/investor/portfolio
Holdings
£14,212,500
347 slices · 198 receivables
Avg YTM
2.31%
Income realised YTD
£487,210
Concentration · top obligor
12.4%
Northwind Retail plc
Holdings
Token
Originator
Obligor
Face
Days to maturity
Status
FXR-INV-23A4F-S2
Coppergate Joinery
Northwind Retail plc
£2,000.00
53
Held
FXR-INV-22Y91-S4
Halton & Crane
Yorkshire Schools
£1,892.00
38
Held
Where it can go wrong
| Branch | What the investor sees | State | Recovery |
|---|---|---|---|
| MiFID II classification lapses (annual revalidation missed) | Marketplace blocked; existing positions remain held but cannot be added to. | MIFID_LAPSED | Re-affirm classification at /investor/classification. |
| Pre-trade check answers "No" on Q2 (sanctions delta on a director) | Trade blocked; modal: "We need to recheck your firm before any new trade." | PRE_TRADE_FAIL_SANCTIONS | Routes to MLRO queue with the trade context attached. Existing positions held; investor unfrozen on MLRO sign-off. |
| Chain transfer fails compliance module (rare — typically a wallet binding mismatch) | "Trade did not settle. Money has been returned to your account. Please contact us." | TRADE_FAILED_CHAIN | Investor support investigates the wallet/identity binding; the lender's slice returns to listed. |
| Underlying receivable defaults (T6, before maturity) | Slice marked DEFAULT in portfolio; income reversed; principal at risk. | DEFAULT | Recovery on the lender side — the slice receives a pro-rata share of any recovery proceeds. |
| Investor wants to sell on early | "List slice on secondary." Same T1–T5 in reverse. | LISTED_BY_INVESTOR | Standard secondary listing. |
MIFID_CLASSIFIED · ECPfor Brunel) is written to the on-chain Identity Registry as an attestation. Every secondary-markettransfercalls the Compliance Module which reads this attestation and aborts if it's missing or expired. Annual revalidation is mandatory; lapsed classification freezes new trades but does not force liquidation of held positions. If an investor opts down from ECP to Professional voluntarily (rare), the venue rules change in their favour for some MiFID protections — recorded in the audit log.