This article covers the Interest Account, Model Portfolios, Business Brokerage and Crypto Earn Account. If you are asking about the money in your Vivid account for payment services, see our article on how your daily funds are protected.
Who provides these products, and who regulates them?
The Interest Account, Model Portfolio, Business Brokerage and Crypto Earn Account are provided by Vivid Money B.V., an investment firm and a Crypto Asset Service Provider licensed and supervised by the Dutch Authority for the Financial Markets (AFM).
Vivid Money B.V. is a different company from Vivid Money S.A., which provides your Vivid account in regards to payment services. They hold different licences, follow different rules on holding client money and assets, and their protection arrangements are independent of one another. So the money in your daily accounts and the money in your investment accounts, referenced above, are protected separately, not as one pot.
Where is my money actually held?
Vivid Money B.V. has set up two separate legal entities, called foundations, whose only purpose is to hold customer funds and assets:
Stichting Vivid Money — for the Interest Account, Model Portfolio and Business Brokerage (i.e. Invest Services).
Stichting Vivid Money Crypto — for crypto, including the Crypto Earn Account (i.e. Crypto Services).
Each foundation has bank accounts with other institutions and is entirely separate from Vivid Money B.V. Vivid Money B.V. is not permitted to keep any of its own money in them. This is what makes your funds recoverable if something were to happen to Vivid Money B.V.
Note: shares, ETFs and money market funds you have bought are held in the name of Vivid Money B.V. rather than a foundation. Dutch law keeps these assets separate from our own automatically, so they are just as protected.
What happens to my uninvested cash?
Uninvested cash is money in one of these accounts that you have not yet invested in financial instruments or crypto assets or, in the case of the Interest Account, is earning fixed interest. For the first few days (up to 5 business days) it is held in segregated accounts in the name of the above mentioned legal entities (Stichting) at Banking Circle S.A.
After that:
In the Interest Account, Model Portfolio and for stock, ETF & fund trading in Business Brokerage, it is invested into a Qualifying Money Market Fund (QMMF). These funds are tightly regulated and may only hold highly secure, highly liquid assets such as government bonds.
For the Crypto Earn Account and crypto trading in Business Brokerage, it is allocated to EURC, a euro-backed stablecoin designed to hold a steady 1:1 value against the euro.
In both cases the money is held in the name of the relevant foundation, not in the name of Vivid Money B.V. and therefore segregated from and protected against bankruptcy of Vivid Money B.V.
Where do my investments sit?
Shares, ETFs and money market funds you buy are held in the name of Vivid Money B.V. for you at Interactive Brokers (Ireland) Limited, Upvest Securities GmbH and/or Lemon Markets GmbH.
Crypto assets you buy are held at Finst B.V. and/or Copper Markets (Switzerland) AG, in the name of Stichting Vivid Money Crypto.
What would happen if Vivid Money B.V. went bankrupt?
While shares, ETF’s and money market funds are held in the name of Vivid Money B.V, they would not form part of our liquidation estate as those assets are segregated by law, and they would be returned to you in full.
And if that somehow failed?
In the very unlikely event that the foundation could not return your funds — for example if the rules on keeping assets separate had been broken — some of them are additionally covered by the Dutch Investor Compensation Scheme. You would submit a claim to De Nederlandsche Bank, and the scheme pays up to EUR 20,000.
That EUR 20,000 applies per entity, not per account.
For example: Your company is one entity, so several accounts held by the same company share a single EUR 20,000 limit. If you also hold a personal Vivid account, that is a separate entity with its own limit. Three companies would each have their own.
What are the risks?
Money market funds carry a very low but not zero level of risk. The funds we use sit at level 1 of 7 on the Summary Risk Indicator, which is the lowest category, and they aim to track the euro short-term rate. Poor market conditions are unlikely to affect their ability to pay out. Our risk brochures (invest and crypto) sets out the details.
EURC is designed to hold a stable 1:1 value against the euro, but it is not a currency. Like any digital asset it carries some counterparty and technological risk. Those risks are limited, but worth knowing about.