The VASP definition is a functional definition, meant to be applied based on an assessment of whether a person undertakes functions of a VASP and provides a qualifying service (FATF Virtual asset Guidance, §56).

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A person may be a VASP if it carries out one or more of the five categories of activity or operation described in the VASP definition - i.e., “exchange VA-to-fiat”, “exchange VA-to-VA”, “transfer,” “safekeeping and/or administration of VA” and “Participation in and provision of financial services related to an issuer’s offer and/or sale of VA” (FATF Virtual asset Guidance, §62).

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However, the VASP definition is subsidiary to others, in order to avoid repetition or overlap. In other words, the definition of VASP only applies to persons that are not covered elsewhere by other applicable legal or regulatory provisions (FATF Virtual asset Guidance, §57).

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It excludes, for example, financial institutions and designated non-financial businesses and professions providing their traditional services with no relation to Virtual assets (FATF Virtual asset Guidance, §57).

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That being said, the VASP definition is to be interpreted broadly (FATF Virtual asset Guidance, §56).