MiCA-licensed Tesseract has launched Dedicated Client Vaults, segregated smart contract performance accounts built for institutions wary of pooled DeFi products.
Summary
- Tesseract, the Finnish MiCA-licensed crypto asset manager, has launched Dedicated Client Vaults for institutional and professional investors.
- Each vault is a segregated smart contract linked to a single client, allowing institutions to retain 100% ownership of the vault’s tokens while complying with MiCA custody rules.
- Chief executive James Harris says performance-sharing vaults like Morpho’s could be treated as collective investment schemes under MiCA, exposing users to the risk of unlicensed securities.esma.
Finnish crypto asset manager Tesseract Investment Oy, one of the first companies to obtain full financing Mica Licensed in the European Union, it has launched a new on-chain performance platform called Tesseract Dedicated Client Vaults aimed directly at institutional and professional investors. The offering, reported by The Block via company materials, is designed so that each vault is a standalone smart contract dedicated to a single customer and managed by Tesseract, rather than a shared equity pool. Customers deploy vaults from their own wallets, own 100% of the vault tokens representing their assets, and maintain segregated custodial accounts that satisfy MiCA requirements for segregation and custody of customer assets.
In a recent LinkedIn post outlining “five key things institutions need from on-chain vaults,” James Harris, CEO of Tesseract, drew a clear line between custodial vaults and pooled performance vaults, warning that the latter may be subject to EU rules for collective investment schemes. “We see MiCA as an opportunity, not a burden,” Harris said in a separate interview on the Alt Funds Network, adding that institutions “look at DeFi through a lens of regulation, segregation and control, not just APY.” He pointed to popular pooled structures, such as Morpho vaults, as examples of products that could be treated as collective investment schemes under the direction of MiCA, putting them in the orbit of UCITS or AIFMD style rules if their performance tokens represent a share of pooled capital with a defined investment strategy.
The European Securities and Markets Authority’s final report on the MiCA guidelines notes that a cryptoasset should be classified as a unit in a collective investment scheme if it “represents a participation in a pooled investment with the objective of generating a return for investors in accordance with a defined investment policy.” Harris maintains that many pooled DeFi yield products fit that description, which could turn their yield tokens into unlicensed securities when marketed to EU investors. By contrast, Tesseract Dedicated Client Vaults hold each institution’s assets in their own smart contract, without pooling capital or sharing returns among different investors, aligning more clearly with MiCA’s cryptoasset service provider regime than with fund regulation.
Tesseract MiCA authorization, granted by FinlandThe 2025 Financial Supervisory Authority will allow the Helsinki-based company to offer portfolio management, custody and asset transfer services for retail and professional clients across the EU. Private Banker International has described the company’s strategy as “betting on compliant yield as the cornerstone of the industry’s next phase of growth,” citing planned innovations such as risk-banded yield strategies and tokenized vaults designed for banks, wealth managers and corporations.
The launch of Dedicated Client Vaults comes as traditional cryptocurrency trading has lost much of its appeal. A recent note cited by Gate.io noted that the annualized yield of Bitcoin’s once-popular cash-and-carry arbitrage has plummeted from over 17% to around 5%, just above the roughly 3.5% yield on one-year US Treasuries. “The era of easy, nearly risk-free institutional money in cryptocurrencies is decisively over,” Harris said in that article, characterizing current conditions as “a tactical reset” rather than a full institutional exit.
In a previous crypto.news article on how the GENIUS Act and MiCA are reshaping the infrastructure of stablecoins and DeFi, legal experts argued that yield products would need to move closer to regulated funds or mandate-style structures to survive, especially for European clients. Another story about South Korea’s race to issue bank-backed stablecoins highlighted how global institutions are increasingly demanding clear legal frameworks before deploying capital in on-chain yield strategies. A third story examining the end of the era of easy cash-and-carry highlighted that future crypto returns for institutions will likely come from more complex, compliance-focused products rather than simple spread trading – exactly the niche Tesseract appears to be targeting with its MiCA-compatible vaults.
