> ## Documentation Index
> Fetch the complete documentation index at: https://docs.paxos.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Institution Types and Members

> Learn about institution types, member roles, and requirements

## 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                |
| <code style={{whiteSpace: 'nowrap'}}>SOLE\_PROPRIETORSHIP</code> | 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_ENTERTAINMENT`
* `DRUGS`
* `RANSOMWARE`
* `SHELL_BANK`
* `WEAPONS`

### 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.                                                                                                                                                                                                                                                                                                                  |

**Required details**

| 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                        |

Note that each category of `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                         |

Note: `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                        | <span>Trust</span> | <span>Corporation</span> | <span>LLC</span> | <span>Partnership</span> | <span>Sole Proprietorship</span> |
| --------------------------- | :----------------: | :----------------------: | :--------------: | :----------------------: | :------------------------------: |
| `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](#sole-proprietorships).
* For all institution types, members must be Identity objects already created in the system.