Crypto Class 1 - Attachment 8. RFP Questions and Answers 20240313.xlsx
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- Cryptocurrency Managed Services - Class 1
- Solicitation number
- 15M50024QA4400002
About this file
This document is a set of Questions and Answers related to a Request for Proposal (RFP) for Cryptocurrency Managed Services - Class 1, Solicitation Number 15M50024QA4400002, issued by the U.S. Marshals Service (USMS) on behalf of the Department of Justice Asset Forfeiture Division.
The RFP is seeking a single award Indefinite Delivery/Indefinite Quantity (IDIQ) contract to manage and dispose of large quantities of popular cryptocurrency assets, known as Class 1 cryptocurrencies. The IDIQ contract will have a 5-year ordering period, with the potential for a 6-month extension. The Q&A document addresses various details related to the contract transition, storage and disposal requirements, pricing structure, insurance and auditing needs, and other technical and operational aspects of the required services. It also clarifies that this RFP is for Class 1 cryptocurrencies only, and a separate RFP will be released later for Classes 2 through 4.
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Sheet1
RFP Questions and Answers Attachment #8
| Cryptocurrency Managed Services - Class 1 | ||||
| Question # | RFP Section | RFP Page | Question | Answer |
| 1 | General | Is there an incumbent/current contract number? | This is a Request for Proposal (RFP) for a new contract; there is no incumbent currently performing or any related contract number. | |
| 2 | General | Is there a separate RFP that will be released for Classes 2 thru 4 and what is the timeline for that release? | There is a separate RFP for Crypto Classes 2 thru 4; the anticipated release time frame is 3rd qrt FY 24, most likely April 2024. | |
| 3 | General | How many submissions has the government received to date to support this RFP? | This data will not be shared. | |
| 4 | General | Are there anticipated delays to the time frame for submissions to the RFP? | No delays are anticipated. | |
| 5 | General | Can I request an extension on the deadline? | No extensions will be granted. | |
| 6 | General | Is there the potential for partial awards under this solicitation? | This solicitation will issue one single award for an Indefinite Delivery Indefinite Quantity (IDIQ) type contract. No partial awards will be made. | |
| 7 | General | 1 | For an Offeror to provide the scope of services required in the RFP, the Offeror would typically require a client / partner to negotiate and sign standard agreements, such as a prime broker and/or custodial agreement. These agreements enable the execution of the required services while providing important protections to the parties, etc. Is the USMS limited in any way with respect to its ability to engage in such agreements? | As stated in the previous answer #6, this solicitation will issue one single award for an Indefinite Delivery Indefinite Quantity (IDIQ) type contract. Offerors may enter a subcontracting agreement or a teaming agreement in order to provide the services required by the Crypto Class 1 Performance Work Statement (PWS). When establishing a subcontracting relationships or teaming agreement, Offerors shall review the SOC audit compliance required for this effort as per Attachment #4 Evaluation Criteria. |
| There is privity of contract, as the government utilizes a two-tiered contracting system for procurements where it enters into a contract with the prime contractor that, in turn, contracts with subcontractor(s) to fulfill contractual requirements.There is no privity of contract between the Government and the subcontractor. However, the Federal Acquisition Regulation (FAR) and its supplements contain certain contract clauses that must “flow down” to subcontractors and will be added to the resulting contract award. | ||||
| 8 | PWS 1.3 | 4 | Please describe the current state process for onboarding crypto assets from USG Investigating agencies, managing custodial operations, determing when to dispose assets, and how said assets are being liquidated. | Cryptocurrency assets are transferred to the U.S. Marshals Service (USMS) from a variety of agencies participating in the Department of Justice (DoJ) Asset Forfeiture Program (AFP). Once transffered, the cryptocurrency is held in cold storage until the forfeiture is adjudicated. Once authorizing documents are received the cryptocurrency is liquidated using an exchange platform where it is sold for U.S. currency. |
| 9 | PWS 1.3 | 4 | Please provide a reference architeture of all related systems, networks, and applications. | We are not confined to any specific architecture. |
| 10 | PWS 1.3 | 4 | Please provide a copy of the most recent operational audit of the Complex Assets Unit in order to identify any additional risk management requirements. | Please refer to the Audit of the Assets Forfeiture Fund and Seized Assets Deposit Fund Annual Financial Statements for Fiscal Year 2022: https://oig.justice.gov/sites/default/files/reports/23-036.pdf |
| 11 | PWS 1.3 | 4 | Please provide a white- and black-list of crypto exhanges the USMS is wiling to work with. | See Performance Work Statement Section 2.4.1.2:Use of Exchanges for Liquidation. A final list will be agreed upon at contract award. |
| 12 | PWS 1.4 | 5 | Table 1. Please provide a breakdown of Class 1 Asset Count (1500) by cryptocurrency type. | This data will not be shared. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). A final list will be agreed upon at contract award. |
| 13 | PWS 1.4 | 5 | Table 1. Please explain how Market Value was estimated. | Market Value was estimated by multiplying the units of cryptocurrency by the close-market price the day the table was created. |
| 14 | PWS 1.4 | 5 | Please provide a good faith forecast of asset count by month for the duration of this contract. | The number and quantity of Class 1 assets seized on a monthly basis is driven by investigative cases of DOJ AFP participants and cannot be predicted. The vendor would be required to take custody and manage all cryptocurrency assets that fall under the Class 1 category regardless of size and value. |
| 15 | PWS 1.4 | 5 | Can the USMS please provide a full list of asset types (tokens) and supported blockchains classified under Class 1 that they will require custody and liquidation services for? Is the extent of the list Bitcoin, Ethereum, Litecoin, and Tether? | This data will not be shared. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). A final list will be agreed upon at contract award. |
| 16 | PWS 1.4 | 5 | What does the asset count of 1500 refer to? | 1500 is the number of assets in custody (e.g. one asset can equal 10 BTC, another 24.124939 USDT, another 9,231,871.96145 ETH, etc.). |
| 17 | PWS 1.4 | 4 | Is the USMS able to share a full list of the class 1 portfolio assets to ensure we can in fact support all assets? | This data will not be shared. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). A final list will be agreed upon at contract award. |
| 18 | PWS 1.4 | 4 | The RFP mentions Tether as a Class 1 Cryptocurrency. What blockchains do you require for Tether? It is available on 14 different blockchains. | Blockchains required will be what is supported by most wallets and exchanges. |
| 19 | PWS 1.4 | 5 | This section indicates that the asset count for Class 1 Cryptocurrency is 1500. Please confirm. Are these 1500 various types of tokens? Could you provide a list of the token names and the number per token? | 1500 is the number of assets in cusotdy (e.g. one asset can equal 10 BTC, another 24.124939 USDT, another 9,231,871.96145 ETH, etc.). Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). A final list will be agreed upon at contract award. |
| 20 | PWS 2.1.2 Contract Transition | 6 | This section states "The Contractor, including the contractor’s facility(s), shall be fully equipped and ready to begin performance within 60 calendar days, or sooner, after the award date." This transition time is doable for most major tokens. However, there may be outlier tokens that may need to be vetted and require technical implementation. To confirm there are no outliers, could you please provide a list of the named 1500 tokens and the number per of tokens per token type? I.e. 1000 ETH, 500 DOGE, 1200 ADA, etc. | This data will not be shared. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). A final list will be agreed upon at contract award. |
| 21 | PWS 2.1.3 | 7 | Can the USMS please advise of the type(s) of cryptocurrency wallets/exchanges/services expected to be utilized by the investigating agencies taking custody of the seized assets prior to transferring the assets to the contractor? | This data is not available. |
| 22 | PWS 2.2 | 7 | By saying assets are “backed up”, do you mean the private key is kept in at least 2 locations in a secure manner separated by 100 miles? | Anything that can be used to access/reconstruct the wallet shall be backed up following the guidelines in the Performance Work Statement (Attachment #6) Section 2.2 Storage. |
| 23 | PWS 2.3.1 | 7 | Does USMS need direct access to the asset management system? Or, will you only request reports when needed? | Direct access is preferred. |
| 24 | PWS 2.3.4 Risk Mitigation and Security | 9 | Can the RMP, BCP and QCP be a collaborative effort with the subcontractors? | Yes, as long as the Risk Management, the Business Continuity Plan and the Quality Control Plan adhere to the related guidelines in the Performance Work Statement (Attachment #6), and in the Instructions to Offerors (Attachment #3). |
| 25 | PWS 2.4 Disposal | 9 | This section states "The Contractor shall provide a platform that allows for the quick and efficient disposal of cryptocurrency assets. The Contractor-provided platform shall allow for the following methods of disposal: | The contractor's proposed solution will determine the level of access to the resources used for disposing of cryptocurrency assets. |
| • Direct exchange from cryptocurrency into fiat currency where markets exist. | ||||
| • Return to Investigating Agency, owner, or other third party." | ||||
| This implies the USMS may intend to liquidate or return assets themselves utilizing this platform. However, per the RFP documents, it appears the USMS will utilize the Contract Provider to liquidate, exchange, and/or return assets on behalf of the USMS. If the latter is true, will a platform that allows for quick disposal of crypto assets and asset return to third parties be required for the USMS to utilize directly? | ||||
| 26 | PWS 2.4 | 9 | Does the USMS also require the adminstration of an auction as a means to dispose these assets. | The only disposal requirements are those included in Performance Work Statement (Attachment #6), Section 2.4 Disposal. |
| 27 | PWS 2.4 | 9 | Does the USMS require dual controls and or threshold delegation authority to dispose of assets. | Please refer to Performance Work Statement (Attachment #6) Section 2.4 Disposal. |
| 28 | PWS 2.4 | 9 | Does the USMS have a defined trading strategy to dispose of assets without adversely affecting market prices. | Expectation is for the contractor to provide the best trading strategy based on industry statandards as defined in Performance Work Statement (Attachment #6) Section 2.4: Disposal. |
| 29 | PWS 2.4.1 Standard Disposal via Exchange | 9 | This section states "Standard disposals via exchange shall be completed within five (5) business days of notification." Depending on the token and number of tokens, there may not be enough liquidity to dispose of those tokens within the 5 days. We recommend discussing and determing the token liquidation strategy per event as each token has unique nuances to address. Is the USMS amenable? | The USMS is not amenable to that. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). Liquidity should not be a factor for these types of cryptocurrencies. |
| 30 | PWS 4.ii.a. Disposal | Regarding Asset Return, will there be instances where the assets are to be returned to third parties, would these citizens/individuals - which requires more overhead (notably for KYC/AML)? | Return of assets is dictated by a legal process whereby the USMS is directed to return cryptocurrency to the original owner, or other identified party. As such, the USMS would provide the wallet address to facilitate the return with the contractor. | |
| 31 | PWS 2.4.1.1 | 9 | Section 2.4.1.1 states "Any fees associated with the liquidation, that are deducted from the proceeds..." | Disposal fees shall be inclusive of any additional fees needed for the liquidation of assets. |
| Are there any scenarios where the contractor would need to cover any fees? If so, would these fees be reimbursed? For example: If we dispose of an asset like Optimism for USD, the exchange fee needs to be paid in ETH which could not come out of the proceeds unless we exchange OP for ETH first. | ||||
| 32 | PWS 2.4.1.2 Use of Exchanges for Liquidation | 10 | This section states "The Contractor’s platforms for disposal shall include the use of COR pre-approved, U.S. based exchanges..." Please provide a list of the COR pre-approved, U.S. based exchanges. | See Performance Work Statement (Attachment #6) Section 2.4.1.2 Use of Exchanges for Liquidation. A final list will be agreed upon at contract award. |
| 33 | PWS 2.4.1.2 | 9 | Can the USMS please provide the current list of pre-approved, U.S. | See Performance Work Statement (Attachment #6) Section 2.4.1.2 Use of Exchanges for Liquidation. A final list will be agreed upon at contract award. |
| based exchanges used for liquidation? | ||||
| 34 | PWS 2.4.1.2 | 10 | Can the USMS please provide a list of previous non-U.S. based exchanges utilized for liquidation? Are there any restrictions on liquidity providers (trading desks) that can be used to liquidate assets? | See Perfformance Work Stateemtn (Attachment #6) Section 2.4.1.2 Use of Exchanges for Liquidation. A final list will be agreed upon at contract award. |
| 35 | PWS 2.4.1.2 | 9 | Will the USMS authorize the provider to utilize the cryptocurrency options market as a path to orderly liquidation (specifically, the use of covered calls). | See Performance Work Statement (Attachment #6) Section 2.4 Disposal. |
| 36 | PWS 2.4.1.2 | 9 | Does the USMS require an obfuscation layer for price discovery and asset disposal on the exchanges. | No. |
| 37 | PWS 2.4.1.2 | 9 | Does the USMS require provider to access and dispose assets on a 24*7 basis. | The contractor shall be available during the hours identified in Performance Work Statement (Attachment #6) Section 1.4.4 Hours of Operation. |
| 38 | PWS 2.4.1.2 | 9 | Does the USMS require provider to support an internal transfer process between the DoJ and the National Security community. | No. |
| 39 | PWS 2.4.2 | 10 | Does the USMS require providre to enable a separate escrow service for assets related to pending civil and/or criminal adjudication. | No. |
| 40 | PWS 5.1.1 | 12 | Please clarify the levels and types of insurance coverage required, including whether there are preferred providers or specific policy features that must be included | Refer to the Performance Work Statement (Attachment #6) Section 5.1.1 Insurance. |
| 41 | PWS 5.2.2 Internal Audits | 13 | This section states "...the Contractor is mandated to conduct a one hundred percent (100%) annual inventory reconciliation for all Government | The USMS will defer to the Contractor's resources, or requirement to seek an independent auditor, at their discretion. |
| cryptocurrency assets in its custody, including assets which may have become forfeited and/or pending liquidation based on a disposition order but are still in the custody of the Contractor..." We can recommend an independent 3rd party auditor or utilize the USMS' auditor to provide this audit. Are the costs associated with the accounting firm to be included in our proposed fees? | ||||
| 42 | PWS 5.1.1.1, 5.2.1., 5.2.2, 5.2.3. and 5.2.4 | 14 | Is this a requirement for the submission as a whole (contractor and subcontractor) or each idividually? For instance if one subcontractor does not have any CUI enter their systems would they require SOC? Other items include ATU, Insurance, and audits. | While the Governement intends to award one single IDIQ-type contract to one single entity, Offerors may respond to the solicitation according to the business model they best see fit, whether it is a prime/subcontractor or a teaming agreement. In order to be considered for evaluation and eligible for award, Offerors must have undergone A SOC 1 Type II and SOC 2 Type II audits and must provide the most recent and detailed audit report as per Attachment #4 Evaluation Criteria. This compliance is required for the prime and subcontractor, and/or teaming agrement entities. |
| The insurance shall be maintained as required by the Performance Work Statement (Attachment #6) Section 5.0 Constraints and shall be in line with industry standards. | ||||
| 43 | PWS 5.6.3 Key Personnel | 19 | Do Compliance/Security officer have to be currently employed by contractor, can they be employed by subcontractor? | See Performance Work Statement (Attachment #6) Section 5.6.3 Key Personnel - the personnel in question can be currently employed by either a prime contractor or by a subcontractor as long as they meet the guidelines identified in the applicable Section 5.6.3. |
| 44 | PWS 5.6.3.1 | 19 | Upon being awarded, can the Offeror provide additional Authorized Corporate Representatives or primary points of contact, apart from the Project/Program Manager, to enhance customer support? | Yes, however, the additional personnel proposed to enhance customer support shall not affect the price as negotiated upon award. |
| 45 | Attachment #2, Par 4. Notice of Prohibition | 1 | The section states "The contractor will assist the USMS in complying with the provisions of the Comprehensive Crime Control Act of 1984, regarding the prohibition of sale of forfeited property to a defendant or a person acting as his agent. The contractor shall provide notice to prospective purchasers as to the prohibition." Could you please provide a specific example or correlating scenario for our Legal & Compliance Team's review? | The Contractor may not perform any actions that would knowingly allow the selling of cryptocurrency to a prohibited party (e.g. defendant, agent, those who have acquired information not avaialble to the public, etc.). |
| 46 | ITEM 3 - "FIRM FIXED PRICE CONTRACT LINE ITEM NUMBERS" (Attachment #1) | 1 | Custodial fees are typially charged in basis points (as expressed in the pricing schedule). This means that the actual monthly bill for custodial services to USMS would vary based on the changing value of its portfolio. Can the USMS please confirm that this approach is consistent with its expectations? (The "Firm Fixed Price Contract" language is what prompts this question). | The approach mentioned is consistent with its expectation. |
| 47 | FACTOR 2 - TECHNICAL CAPABILITY/RESUMES (VOLUME 2) (4) Disposal | 10 | This section states "The offeror shall identify how their platform is in line with industry best practices, ensures the best price is obtained, guarantees the market isn’t affected, and is economical." If the time limit to liquidate assets is 5 days, it may be difficult to guarantee that the liquidation will not affect market pricing if liquidity is low. We recommend discussing and determining token liquidation strategies per event as each token has unique nuances to address. Is the USMS amenable? | The USMS is not amenable to that. Class 1 Assets are the most popular cryptocurrencies and tokens supported by most wallets and exchanges without the need for special software or swapping to be managed/liquidated (e.g., Bitcoin, Litecoin, Ethereum, Tether USDT, etc.). Liquidity should not be a factor for these types of cryptocurrencies. |
| 48 | FACTOR 3 - PRICE (VOLUME 3) (Attachment # 3) | 11 | Can the Offeror reserve the right to adjust pricing, providing that the scope of understood services changes upon post-award engagement with the USMS? (We find that scope often evolves over time with large scale crypto engagements). | Pricing shall be proposed based upon Attachment # 3 Instructions to Offerors - It shall include a period of performance with a 12-month base and 4 options, each consisting of 12 months. Pricing for the options may include a reasonable escalation; however, pricing as proposed during the award phase will not be adjusted upon post-award engagements. |
| 49 | ADDITIONAL DETAILS (Attachment # 3) | 4 | Regarding the item "Signed and Dated SF-1449" can you please specify the documentation required for this item? Is this asking for the first two pages of the document titled "15M50024QA4400002 - Crypto Class 1 -v6" to be signed and submitted? | That is correct, the SF 1449 is the document provided as a PDF file via SAM and titled 15M5002QA4400002 - Crypto Class 1 - v6 . It is prescribed |
| for use in solicitations and contracts for commercial products and commercial services. | ||||
| 50 | FACTOR 1 - EXPERIENCE/ORAL PRESENTATION (VOLUME I) (Attachment # 3) | 7-May | Please confirm that for the Oral Presentation we are to submit a presentation (in a readable by Microsoft PowerPoint), but do not need to submit full written responses to each question. | That is correct - Factor 1 Experience is due via oral presentation and supported by a readable Microsoft Power Point file. All the questions identified |
| in Factor 1 Experience shall be addressed in the presentation, however, a full written response to each question is not required. | ||||
| 51 | FACTOR 1 - EXPERIENCE/ORAL PRESENTATION (VOLUME I) (Attachment # 3) | 7-May | Please confirm the presentation materials for the Oral Presentation are to be included with the RFP submission package on April 1st? | That is correct - the readable Microsoft Power Point file supporting Factor 1 Experience/Oral Presentation shall be submitted as part of the RFP submission package due on 4/1/2024. |
| 52 | ADDITIONAL DETAILS (Attachment # 3) | 4 | Reagrding the item "The Representations and Certifications with all fill-ins completed or SAM." Please confirm that if our entity has registered with SAM.gov there is no further action needed for this item. | That is correct - if an entity is registered in SAM and all fill-ins are completed, then no further action is required. |
| 53 | Attachment #3 | 6 | Can the prime contractor utilize the SOC 1 Type II and Soc 2 Type II audits from a subcontractor? | The prime contractor and any subcontractors shall meet the SOC 1 Type II and the SOC 2 Type II audit requirments as stated in Attachment #4 Evaluation Criteria, page 3. |
| 54 | FACTOR 4 - SUBCONTRACTING PLAN, TEAMING AGREEMENT, QUALITY CONTROL PLAN (QCP) (VOLUME 4) (Attachment # 3) | 12 | Regarding the text "Offerors which are not small business concerns shall submit a Small Business Subcontracting Plan." If we are not a small business concern and we do not plan to subcontract our business, please confirm that the subcontracting plan does not need to be completed. | That is correct - upon responding to the RFP, a subcontracting plan is required only for large businesses that plan to utilize a subcontractor for any portion of the required services. |
| 55 | FACTOR 4 - SUBCONTRACTING PLAN, TEAMING AGREEMENT, QUALITY CONTROL PLAN (QCP) (VOLUME 4) (Attachment # 3) | 12 | If neither the subcontracting plan nor the teaming arrangement is applicable to our proposed offering, are we still required to submit documentation for those sections as part of our final RFP package? | No - if no subcontracting plan or teaming agreement is applicable, then no related documentation is required upon the submittal of the RFP package. |
| 56 | FACTOR 4 - SUBCONTRACTING PLAN, TEAMING AGREEMENT, QUALITY CONTROL PLAN (QCP) (VOLUME 4) (Attachment # 3) | 11 | For our exceptions/deviations/conditional assumptions, are we to provide redlines to all clauses included in the RFP documentation? If not redlines, how should the exceptions/deviations/conditional assumptions be formatted? | The clauses contained in the SF 1449 are standard/mandatory for commercial services as required by the Government and cannot be redlined. Any deviations/conditional assumptions have to be provided via statement as part of Volume 4, along with the Teaming Agreement and Subcontracting Plan, if applicable. Please note the Attachment 3 Instruction to Offerors on page 11 incorrectly states that "Any exception/deviation/conditional assumption relating to any part of the RFP shall be submitted in Volume 5." There is no Volume 5, hence any exception/deviation/conditional assumption shall be submitted in Volume 4. |
| 57 | FACTOR 4 - SUBCONTRACTING PLAN, TEAMING AGREEMENT, QUALITY CONTROL PLAN (QCP) (VOLUME 4) (Attachment # 3) | 11 | Are Offerors allowed to apply with their own bid while also agreeing to support other Offerors who are seeking to "team" with or sucontract to us on their own distinct applications? | The RFP terms, including the Instructions to Offeror Attachment #3, don't prohibit this scenario. An offeror may potentially submit its own proposal while agreeing to team/subcontract to another offeror. |
Please note that at the end of the evaluation process, it is the Government's intent to issue one single IDIQ-type contract to one single awardee.
File details come from the government source that posted it. Updated .