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Capital Markets Glossary, C - D
European Banking Authority / EBA
Independent EU Authority tasked with ensuring effective and consistent prudential regulation and supervision across the European banking sector.
Foreign Exchange / FX
The conversion of one currency to another. A number of large FinTech’s such as Revolut and Transferwise focus on this segment. Large corporates and banks have used algorithmic trading in FX for over 20 years.
Initial Coin Offering / ICO
An event where funds are raised, say to develop a FinTech business, by offering new cryptocurrencies in return for a cash investment.
Know Your Client / KYC
A set of checks which must be made by financial services providers to identify their clients. Typically used during onboarding, it helps check for anti-money laundering (AML) and combat financing of terrorism (CFT). The digitalisation of KYC is leading to a boom in RegTech solutions.
Markets in Financial Instruments Directive / MIFID
An EU policy aimed at governing the provision of investment services in financial instruments by banks and investment firms and operation of trading venues.
Peer-to-Peer / P2P
Transactions occurring between persons via a marketplace, typically short-term personal lending. Provides liquidity to borrowers who might otherwise be excluded from market, and potentially high returns for investors.
The founder’s initial capital used to start a business, usually relatively small and sourced from family and friends.
A company’s first round of venture capital financing, usually occurring between proof of concept and growth stages.
A company’s second round of venture capital financing.
A start-up or scale-up with a valuation in excess of USD 1bn, typically based on growth assumptions rather than actual profitability. Opposite of a Cockroach.
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