Linked Accounts
This document covers the workflows and processes required to manage linked accounts as an agent. The Linked Account mechanism is used to allow funds to be committed by approved customers to a 3rd party (the agent), who will manage those funds. Funds may be under management as collateral on an exchange, as funding for an investment strategy, or for some other use agreed between customer and agent.
The intended audience for this document are agent customers of Etana who are integrating their workflows (either via dashboard or API) so that they can access funds committed by customers.
Introduction to Linked Accounts​
Linked Accounts are a specific type of account held within the Etana ledger, which are shared between a customer and an agent.
From a customer perspective, Linked Accounts appear alongside Etana Custody accounts within the dashboard, and behave in very similar ways. There are additional features of Linked Accounts that should be noted, however:
Funds can be transferred between customer custody accounts at will; however, if a customer transfers funds into a Linked Account, those funds are implicitly encumbered at that point, and cannot be transferred back without an approved request from the agent.
Funds cannot be directly deposited or withdrawn into/out of a Linked Account. In order for a customer to fund a Linked Account, they must deposit funds to their Etana Custody account and perform a transfer from Custody to Linked; similarly, funds can only be withdrawn from Custody after having been released from a Linked Account by the controlling agent.
Funds held in Linked Accounts are visible to both the customer and the agent. It should be noted, however, that, depending on the agent’s accounting processes, funds held in a Linked Account may not be fully available for withdrawal by the customer: e.g. when funds are encumbered as collateral for an order or trade, or when a settlement is pending.
Funds held in Linked Accounts are fully accessible by the controlling agent: they can be transferred between customer Linked Accounts and between Linked Account and the agent’s Custody accounts. Because funds held in a Linked Account may be drawn down by the agent at any stage, it is worth reiterating that customers should not assume a Linked Account balance is available without understanding the agent’s accounting processes.
Linked Account accounting flows​
In order to make funds available to the agent, the customer must fund a Linked Account with the agent.
The customer transfers funds to the Linked Account via the Etana Dashboard.
The agent recognises the funds in the Linked Account and performs their own internal accounting to enable those funds within their platform (e.g. by crediting the customer in their own ledger).
The agent is free to manage funds within Linked Accounts that they are managing according to their internal accounting requirements.
- The agent transfers funds from the customer Linked Account to their Custody, or vice versa.
- Funds may be transferred between customer Linked Accounts directly, for instance to perform settlement of trading where both counterparties are within the Linked Account structure at Etana.
When the customer requires funds returned from the agent, the transfer from Linked Account to Custody must be approved by the agent
- The customer enters a transfer request and the agent approves the return of funds.
The Linking Process​
In order to engage in the accounting flows and activities described, the Linked Account must be established between the customer and agent.
Initiating the process​
Customers that are approved within the Etana platform are able to initiate the linking process by requesting a linked account via the Etana dashboard. The customer is asked who it is they wish to link with, and for an identifier that identifies them to the 3rd party agent.
As an agent, you should provide your customer with an identifier that uniquely identifies that customer to you so that you can cross-reference the linked account instance with your customer.
Using a custom referral link, it is also possible to initiate the linking process at the point that the customer begins onboarding with Etana, and prior to full approval of the customer profile.
Identifying the request​
Agents have a dashboard option available that allows them to view Linked Accounts that are “onboarding” (the requesting customer is yet to be approved into the Etana platform), “requested” (the Linked Account request has been initiated by an approved Etana customer profile), “approved” (the agent has accepted the Linked Account request, and the Linked Account is active), and “rejected” (the agent has rejected the Linked Account request). Only a “requested” Linked Account request can be approved by the agent.
Approving the request​
The agent may choose to perform additional verification of the customer before approving a Linked Account request.
At the point that a decision is reached to approve (or reject) a request, this can be done via the dashboard or via the appropriate API call.
When a Linked Account is approved, the accounting structures are created to support the accounting flows described and the account becomes active.
Releasing funds from a Linked Account​
When a customer wishes to withdraw funds from the agent’s platform via the Linked Account, they must request the return of funds. The agent must confirm that the funds are available and approve the request in order for funds to be released.
The process for reviewing and approving (or rejecting) transfer requests is similar to the linking process, with additional accounting concerns:
The customer requests a transfer from their Linked Account.
The agent identifies the pending request and confirms the availability of funds, rebalancing funds across accounts if necessary: the funds need to be available in the Linked Account in order for the transfer to the customer’s Custody to complete successfully.
The transfer is approved at Etana, and the funds are then transferred to the customer’s Custody account.
In the event that funds are not available, the agent should reject the request.
