Institution Types
Institution Type
Institution type (institution_type) is the primary legal structure of the institution, which can be one of the following:
| Institution Type | Description |
|---|---|
CORPORATION | A legal entity that is separate and distinct from its owners |
LLC | Limited Liability Company, a business structure that combines elements of partnerships and corporations |
TRUST | A legal entity created to hold and manage assets for beneficiaries |
PARTNERSHIP | A business relationship between two or more individuals who share management and profits |
SOLE_PROPRIETORSHIP | An unincorporated business owned and run by one person, onboarded with a single owner-member |
Institution Subtypes
Institution subtype (institution_sub_type) is the primary area of business activity of the institution,
work with your Paxos Partner to understand the mapping from your institution subtypes to ours.
Paxos prohibits certain types of business activity (“Prohibited Businesses”) in accordance with its Compliance policies.
The following non-exhaustive list is representative of the type of activity that Paxos prohibits on its platform. By creating a Paxos Identity, Paxos customers agree not to use Paxos services in connection with any of the following Prohibited Businesses.
ADULT_ENTERTAINMENTDRUGSRANSOMWARESHELL_BANKWEAPONS
Sole Proprietorships
A sole proprietorship is onboarded as an institution (institution_type = SOLE_PROPRIETORSHIP) with a single owner-member representing the person who runs the business. Available under Paxos Trust Company (PTC) licensing only — submissions under other licensing arrangements are rejected.
| Aspect | Requirement |
|---|---|
| Members | Exactly one member, with role exactly [SOLE_PROPRIETOR] (optionally + ACCOUNT_OPENER). Zero-member or multi-member submissions are rejected. BENEFICIAL_OWNER, AUTHORIZED_USER, MANAGEMENT_CONTROL_PERSON, and DIRECTOR are not permitted on the owner-member, and no beneficial_owners / UBO are collected — the owner-member implicitly holds 100%. |
| Identification | cip_id_type = SSN (institution cip_id must match the owner-member’s CIP) or EIN (no match required). ITIN is not supported. |
| Regulation | Always PRIVATE and NON_REGULATED. Do not send other regulation_status or trading_type values; the regulated-institution validations do not apply. |
| Sub-type | institution_sub_type is required but not locked. MONEY_SERVICE_BUSINESS, FINANCIAL_INSTITUTION, and MARKET_MAKER route to manual review (slower approval) rather than rejection. |
| Screening | Both KYB (institution) and KYC (owner-member) run. |
| Field | Required |
|---|---|
name | ✅ |
business_address | ✅ |
institution_type (SOLE_PROPRIETORSHIP) | ✅ |
institution_sub_type | ✅ |
cip_id | ✅ |
cip_id_type (SSN or EIN) | ✅ |
cip_id_country | ✅ |
incorporation_address | Not applicable |
has_underlying_trust_structure | Not applicable |
has_nominee_shareholders | Not applicable |
beneficial_owners | Not applicable |
Creating Financially Regulated Institutions
Please refer to the following table for creating institutions which are financially regulated.| Regulation Status | Description |
|---|---|
US_REGULATED | Institution financially regulated in the US |
INTL_REGULATED | Institution financially regulated by an international entity |
NON_REGULATED | Non-financially regulated institution |
regulation_status then has additional validations tied to trading_type and other required fields.
| Regulation Status | Trading Type | Fields Required | Notes |
|---|---|---|---|
US_REGULATED | PRIVATE | regulator_name, regulator_jurisdiction, regulator_register_number | Not publicly traded |
US_REGULATED | PUBLIC | listed_exchange, ticker_symbol, regulator_name, regulator_jurisdiction, regulator_register_number | Publicly traded |
US_REGULATED | PUBLICLY_TRADED_SUBSIDIARY | listed_exchange, ticker_symbol, regulator_name, regulator_jurisdiction, regulator_register_number, parent_institution_name | Subsidiary of a publicly traded company |
INTL_REGULATED | PRIVATE | regulator_name, regulator_jurisdiction, regulator_register_number | Not publicly traded |
INTL_REGULATED | PUBLIC | listed_exchange, ticker_symbol, regulator_name, regulator_jurisdiction, regulator_register_number | Publicly traded |
INTL_REGULATED | PUBLICLY_TRADED_SUBSIDIARY | listed_exchange, ticker_symbol, regulator_name, regulator_jurisdiction, regulator_register_number, parent_institution_name | Subsidiary of a publicly traded company |
NON_REGULATED | PRIVATE | None | Not publicly traded |
NON_REGULATED | PUBLIC | listed_exchange, ticker_symbol | Publicly traded |
NON_REGULATED only supports PRIVATE and PUBLIC trading types. PUBLICLY_TRADED_SUBSIDIARY is not supported for NON_REGULATED institutions.
Institution Members
Member Roles
Institution members can have one or more roles that define their relationship with the institution. Each role has specific requirements and applicability depending on the institution type:| Role | Description |
|---|---|
BENEFICIAL_OWNER | Person who owns 25% or more of the institution. |
ACCOUNT_OPENER | Person who opened the account on behalf of the institution. |
AUTHORIZED_USER | Person authorized to transact on behalf of the institution. |
MANAGEMENT_CONTROL_PERSON | Person with significant management control over the institution (e.g., CEO, CFO, COO). |
TRUSTEE | Person who manages assets in a trust for beneficiaries and is legally responsible for the trust. |
GRANTOR | Person who creates a trust by donating assets. |
BENEFICIARY | Person who receives benefits from a trust. |
SOLE_PROPRIETOR | Person who owns and operates a sole proprietorship. Used only for SOLE_PROPRIETORSHIP institutions. |
Role Compatibility by Institution Type
The following grid shows which roles are applicable for each institution type:| Role | Trust | Corporation | LLC | Partnership | Sole Proprietorship |
|---|---|---|---|---|---|
BENEFICIAL_OWNER | — | ✅ | ✅ | ✅ | — |
AUTHORIZED_USER | — | ✅ | ✅ | ✅ | — |
MANAGEMENT_CONTROL_PERSON | — | ✅ | ✅ | ✅ | — |
TRUSTEE | ✅ | — | — | — | — |
GRANTOR | ✅ | — | — | — | — |
BENEFICIARY | ✅ | — | — | — | — |
SOLE_PROPRIETOR | — | — | — | — | ✅ |
- Trusts: A trust institution must have at least one member with one of the following roles: GRANTOR, TRUSTEE, or BENEFICIARY.
- Corporations, LLCs, Partnerships: These institutions typically require at least one BENEFICIAL_OWNER and one MANAGEMENT_CONTROL_PERSON.
- Sole Proprietorships: Exactly one member holding the SOLE_PROPRIETOR role (optionally also ACCOUNT_OPENER). See Sole Proprietorships.
- For all institution types, members must be Identity objects already created in the system.