1. Issuer default risk
In the event that a Virtual Asset/ Securities issuer becomes insolvent and defaults on their issued products, investors will be considered as unsecured creditors and will have no preferential claims to any assets held by the issuer. Investors should therefore pay close attention to the financial strength and credit worthiness of such issuers and conduct their own assessment on the potential of the issuer's project. Since Virtual Assets/ Securities may not be asset backed, in the event of issuer bankruptcy or cease to be in operation, their tokens issued may no longer have any value and investors can lose their entire investment.
2. Liquidity risk
Liquidity risk is the risk of losses attributable to a lack of liquidity (for example very few active market participants) in a particular market. This is usually indicated by wide bid / offer spreads and very few transactions being carried out in a particular product or market. The risk is that changes in the underlying market price may be infrequent but very large, and that it is not possible to unwind or transfer a particular transaction in a timely manner, at near the price the investor had expected, or at all.
3. Volatility risk
Prices of Virtual Assets/ Securities can increase or decrease significantly causing substantial loss. Such fluctuations could affect the price of any Securities or Virtual Assets. Investors should exercise caution when trading with any Securities or Virtual Assets.
4. Trading suspension risk
During the suspension of trading of the Virtual Assets/ Securities, investors and potential investors cannot buy and sell units on the Coinsuper Premium Platform. In terms of providing a fair and orderly market with regarding the interests of investors, the Coinsuper Premium Platform may suspend the trading whenever it is appropriate. If the trading is suspended, the subscription and redemption of Virtual Assets / Securities may also be suspended.
5. Investor compensation risk
The protection offered by the Investor Compensation Fund does not apply to transactions involving Virtual Assets.
6. Legal and regulatory risks
Legal and regulatory risks include the risk that transactions and/or their related framework arrangements may not be legally enforceable or that the conduct of the parties violates applicable laws and regulations. Legislative and regulatory changes may adversely affect the use, transfer, exchange, and value of Virtual Assets / Securities.
7. Regulatory Measures
Virtual Assets / Securities may be overseen by the legal and regulatory authorities of a number of jurisdictions globally. The Coinsuper Premium Platform may receive notices, queries, warnings, requests or rulings from one or more authorities upon short notice, or may even be ordered to suspend or terminate any action in connection with any Virtual Assets / Securities as a whole without prior notice to users. Furthermore, many aspects of the Virtual Assets / Securities involve untested areas of law and regulation, and could be subject to new laws or regulations. Therefore, their legal and regulatory outcome in all relevant jurisdictions is not possible to predict. The planning, development, marketing, promotion, execution or otherwise of the Virtual Asset / Securities may be seriously affected, hindered, postponed or terminated as a result of such new laws and/or regulations. Since regulatory policies can change with or without prior notice, any existing regulatory permissions for or tolerance of Virtual Asset / Securities in any jurisdiction may be withdrawn without warning. Cryptographic- tokens and cryptocurrencies could be deemed from time to time as a commodity or virtual commodity, a digital asset or even as money, securities or currency in various jurisdictions and therefore the Virtual Assets / Securities could be prohibited from being entered into, traded or held in certain jurisdictions pursuant to local regulations. In turn, the Virtual Assets / Securities could be deemed to be a regulated or restricted product. There is no guarantee that the Virtual Assets / Securities can maintain any particular legal or regulatory status in any particular jurisdiction at any time.
8. Cryptographic Protection
Cryptography is evolving and there can be no guarantee of security at all times. Advancement in cryptography technologies and techniques, including but not limited to code cracking, the development of artificial intelligence and/or quantum computers, could be identified as risks to all cryptography-based and/or blockchain based systems including the underlying assets of the Virtual Assets / Securities and/or me. The security of the Coinsuper Premium Platform cannot be guaranteed as the future of cryptography or security innovations is unpredictable.
9. Abandonment or development failure
Due to the technically complex nature of the Virtual Assets / Securities, they could face difficulties from time to time that may be unforeseeable and/or unresolvable. Accordingly, the development of the Virtual Assets / Securities could fail, terminate or be delayed at any time for any reason (including but not limited to a lack of funds of the relevant issuers). Development failure or termination may render the Virtual Assets / Securities not transferable, not exercisable, and/or obsolete.
10. Theft or digital assets on the Coinsuper Premium Platform
There may be attempts to steal the digital assets on the Coinsuper Premium Platform. While the Coinsuper Premium Platform will endeavor to adopt industry best practices to keep the digital assets safe (including but not limited to the use of cold storage and multi-signature authentications), successful cyber thefts may still occur.
11. Flaw in the source code
While the Coinsuper Premium Platform adopts quality assurance procedures to help ensure the source codes as accurately as possible reflect their intended operation, the flawlessness of the source codes cannot be guaranteed. They may contain bugs, defects, inconsistencies, flaws or errors, which may disable some functionality, create vulnerabilities or cause instability. Such flaws may compromise the predictability, usability, stability, and/or security of the Coinsuper Premium Platform. Open source codes rely on transparency to promote community-sourced identification and solution of problems within the code.
12. Unpermissioned, decentralized and autonomous ledger
The Coinsuper Premium Platform is being developed to serve various distributed ledger systems which are unpermissioned protocols that could be accessed and used by anyone. In addition to the use of decentralized ledgers, the Coinsuper Premium Platform intends to make use of supporting technologies that also operate on decentralized ledgers. The utility and integrity of the Coinsuper Premium Platform relies on the stability, security and popularity of these decentralized ledgers.
13. Compromised security
The Coinsuper Premium Platform relies on open source software and unpermissioned decentralised distributed ledgers [including but not limited to Ethereum]. Accordingly, anyone may intentionally or unintentionally compromise the core infrastructural elements of the Coinsuper Premium Platform and its underlying technologies. This may consequently result in the loss of any digital assets held on the Coinsuper Premium Platform and may cause its system to fall.
14. Inadequacy of processing power
The ramp up of the Coinsuper Premium Platform may be accompanied by sharp increases in transaction numbers and demand for processing power. If the demand for processing power outgrows that forecasted, the network of the Coinsuper Premium Platform could be destabilized and/or stagnated. This may create opportunities for fraudulent activities including but not limited to false or unauthorized transactions (such as “double-spending”) to arise. All these may adversely impact the usability, stability and security of the Coinsuper Premium Platform.
15. Unauthorized claim of assets
Virtual Assets / Securities can be claimed in bad faith by any person who successfully gains access to the Accounts maintain with the Coinsuper Premium Platform. This can be as a result of deciphering or cracking the relevant user’s password, phishing scams and/or other hacking techniques. Subsequently, these Virtual Assets / Securities may be sent to anyone and such remittance may not revocable or reversible. It is recommended that all users should take appropriate security measures to safeguard their wallet, email and accounts. Each user is responsible for the security of their wallet, email and Accounts on the Coinsuper Premium Platform at all times.
Many cryptographic tokens are developed on the Ethereum blockchain, which is an open source protocol. Once released to the open source community, anyone may develop a patch or upgrade for the source code of Ethereum without prior permission by anyone else. The acceptance of patches or upgrades by a significant, but not necessarily overwhelming percentage of the Ethereum holders could result in a “fork” in the Ethereum blockchain. This will apply to all other open source blockchains that share similar features to the Ethereum blockchain.
The temporary or permanent existence of forked blockchains could adversely impact the operation of the Coinsuper Premium Platform. Such a fork can undermine the sustainability of the exchange ecosystem, and may frustrate the Coinsuper Premium Platform. While a fork in the blockchain could possibly be rectified by community-led efforts to re-merge the two separate branches, success is not guaranteed and could take an undetermined amount of time to achieve.
17. Other related risks
1) Virtual Assets / Securities are not legal tender;
2) transactions in Virtual Assets / Securities may be irreversible, and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable;
3) the value of a Virtual Asset / Securities may be derived from the continued willingness of market participants to exchange fiat currency for a Virtual Asset / Securities, which means that the value of a particular Virtual Asset / Securities may be completely and permanently lost should the market for that Virtual Asset / Securities disappear;
4) the volatility and unpredictability of the price of a Virtual Asset / Securities relative to fiat currencies may result in significant losses over a short period of time;
5) the offering documents or product information provided by the issuer of a Virtual Asset / Securities may not have been subject to review or authorization by any regulatory body;
6) the nature of Virtual Assets / Securities exposes them to an increased risk of fraud or cyberattack; and
7) the nature of Virtual Assets / Securities means that any technological difficulties experienced by the Coinsuper Premium Platform may prevent the access of a user's Virtual Assets / Securities.
This Appendix does not purport to be a complete exhaustive list of the risks and features of the risks involved in trading the Virtual Assets / Securities on the Coinsuper Premium Platform. I will not rely on the contents herein alone to make any investment or trading decision but should read carefully the related offering documentation, whitepaper and any other relevant documentation, in particular, detailed risks relating to each Virtual Asset / Securities contained in such documents. I should not deal in Virtual Assets / Securities unless I understand the nature of the Virtual Assets / Securities and the extent of the exposure to risk. You should also consider your own financial position and particular circumstances before making any investment or trading decision. In case of doubt, you are strongly advised to obtain independent professional advice.
This Agreement does not constitute, nor is it intended to be nor should it be construed as offer or solicitation to invest in any Virtual Assets / Securities. The Coinsuper Premium Platform is not intended to be offered to persons in the jurisdiction or countries that will violate the law or regulation of such jurisdiction or country, and it is not intended to be used by such persons.