# kaal:claim:5454054-029

**Claim.** BaFin applies substance over form, so transferable, tradable, or profit-oriented reward units risk classification as crypto-assets or financial instruments in Germany, potentially triggering licensing obligations such as crypto custody or proprietary trading.

**Type.** failure  **Support.** argued

**Holds when.**

- Germany
- reward units that are transferable, tradable, or profit-oriented

**Source quote.**

> BaFin applies substance-over-form. This means that transferable, tradable, or profit-oriented reward units risk classification as crypto-assets/financial instruments, potentially implicating licensing (e.g., crypto custody, proprietary trading).

**From.** Wulf A. Kaal, *Liquid Equity Rewards* (2025), Germany (BaFin), page 23

**Cite as.** Wulf A. Kaal, Liquid Equity Rewards (2025). SSRN: https://ssrn.com/abstract=5454054

**Verify.** sha256 of source PDF `9f53a865e6f0e5424640779df8f9b50923cd7d05649301dd4cc727144749b6e6` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202025%20-%20Liquid%20Equity%20Rewards.pdf

**Failure mode.** BaFin substance over form reclassification  (family: definitional-ambiguity)

**Topics.** institutional-design

**Keywords.** bafin, germany, substance-over-form, licensing, crypto-assets

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