SCHEDULE 1. RISK FACTORS
Available at www.instabridge.io/notices/risks
You should consider carefully the risks described below before making a decision to ACQUIRE, sell or exchange any tokens.
Instabridge shall not be liable for any losses incurred or suffered by users which have been caused or contributed to by events which arise from, OR are IN RELATION TO, a risk that IS identified below or which IS inherent in the creation, development OR issue of tokens or the operation of LEDGERS OR the creation OR use of wallet technology, including but not limited to those set out below.
The terms and conditions of use of the INSTABRIDGE service MAY BE FOUND at https://www.instabridge.io/terms
THE DEFINITIONS SET OUT IN THE INSTABRIDGE SERVICE TERMS AND CONDITIONS SHALL APPLY TO THESE TERMS.
1. THE NATURE OF TOKENS/ WRAPPED TOKENS
1.1 TOKENS have no intrinsic value. Nor does the possession or control of a TOKEN grant the TOKEN holder any contractual or non-contractual rights or privileges.
1.2 TOKENS are embodied or represented in and by the current state of a distributed ledger database.
1.3 PRIVATE KEYS enable the holder to initiate a change in the state of such distributed ledgers according to the protocols, rules and functionality of each such ledger. As such, the nature of the rights or property obtained by acquiring “TOKENS” are intangible and indeterminate.
1.4 TOKENS are not documents of title nor expressions of any right, title or interest in any property, asset or right.
2. RELIANCE OF SOFTWARE SYSTEMS
2.1 The use and benefits of possession, control or ownership of TOKENS or other digital assets are defined by and dependent on the software, systems, wallets, dApps, smart contracts, logic, interfaces and security protocols which facilitate the security, prevent duplicate transfers or exchanges, and permit interoperation with and execution of dApps, smart contracts or other third-party solutions. These may not function as you expect, may fail or may even be subject to malicious activity or errors.
2.2 Third party systems may/will be created, instantiated or controlled by third parties over whom neither You nor We have any control and who owe no contractual, statutory or other duties to You or Us.
2.3 The creators of LEDGERS, software, protocols, dApps, smart contracts, interfaces, wallets and related software and systems may not be identifiable, may not be located in any jurisdiction where you could secure a remedy against them and may not owe You any contractual, legal or other duty of care if the systems fail.
2.4 The operation of a distributed ledger, applications built on ledgers and the holding, operation and exchange of TOKENS involves a high degree of risk.
2.5 You acknowledge, understand and accept the risk of losing access to TOKENS due to loss of PRIVATE KEY(s), custodial fault, misfeasance by third-parties, hardware and software failures, hacking, code or human errors.
3. RISKS OF LOST OR COMPROMISED KEYS
3.1 You acknowledge, understand and accept that if Your private key(s) becomes lost, stolen or compromised or if you lose control over any device which is used to access or control such keys or access custodial arrangements relating to your TOKENS or You lose control of any credentials that provide access to LEDGER accounts, Your private key(s) will likely be irrecoverable and permanently lost and consequentially You will be unable to recover access to or control of any TOKENS relating to those keys.
3.2 Any third party that gains access to Your PRIVATE KEY(s), or any device or security protocol that controls access to or use of such keys, including by gaining access to the login credentials relating to the relevant wallet may be able to misappropriate Your TOKENS or prevent You from accessing or controlling the transfer, staking, un-staking or dealing with Your TOKENS.
4. RISK OF INCOMPATIBLE WALLET SERVICE
Wallet software or wallet service/custody services used to receive TOKENS and to manage the exchange of TOKENS must conform to the relevant token standard and the relevant LEDGER. Failure to maintain such conformity may result in You losing access to or control of Your TOKENS.
5. HARD FORKS
5.1 As part of development or upgrade, the LEDGER software may require a hard fork. If You decide not to adopt, or neglect to participate in, such upgrade You may no longer be able to use your TOKENS, and any non-upgraded or otherwise deprecated TOKENS may lose their utility in full.
5.2 In the event that there is a Hard Fork the WRAPPED TOKENS corresponding to the NATIVE TOKENS existing before such fork may cease to function as intended or at all.
6. COMPUTING RESOURCES
6.1 Available resources may prove inadequate to support TOKENS, which may delay or prevent the delivery or receipt of TOKENS.
6.2 Critical participants in the creation, maintenance and operation of the relevant LEDGER may cease to operate or take actions that result in non-functioning or reduced capacity to process transactions.
7. TAX
7.1 The tax treatment of TOKENS, and transactions involving TOKENS, is uncertain and dealings in TOKENS may result in substantial tax and reporting obligations.
7.2 You are responsible for obtaining advice as to your tax accounting and reporting obligations in connection with any dealings with TOKENS.
8. ADOPTION/ DIVERSITY OF OWNERSHIP
8.1 TOKENS may not be acquired or used by sufficient numbers of individuals, companies and other entities to create any meaningful market, exchangeability or useful function/utility.
8.2 The value, exchangeability and functionality of TOKENS and the security of LEDGERS may be adversely influenced by low diversity of ownership or counterparties and the volume/depth of any market for TOKENS.
9. NO STATUTORY OR OTHER COMPENSATION
9.1 Neither TOKENS nor the provision or use of wallets or custody have the benefit of statutory or other compensation schemes.
9.2 Tokens are not units of account. Ownership, risk of loss and impairment and possession are transferred by delivery of the TOKEN.
10. ABSENCE OF MARKET/MARKET MAKERS
10.1 There may be no market makers or available purchasers or sellers for TOKENS and those who create, develop and participate in respect of any particular LEDGER or application may choose not to enable or otherwise facilitate any secondary speculative trading or any such external valuation of TOKENS.
10.2 The absence of willing buyers and willing sellers may restrict the utility or purpose for using TOKENS and/or utility described in any disclosures, representations, White Papers or prospectuses.
10.3 Even if secondary trading of TOKENS is facilitated by third-party exchanges, such exchanges may be susceptible to fraud or manipulation.
10.4 Prices and value may be extremely volatile and diminish to zero. Further, prices may be affected by media announcements and/or relatively small sales or purchases of TOKENS.
10.5 Neither the loss of TOKENS nor the consideration you pay/deliver/exchange are subject to any guarantee, indemnity, insurance or other scheme and you will not be reimbursed by any governmental or other entity.
11. RISKS SPECIFIC TO WRAPPED TOKENS
11.1 WRAPPED TOKENS are issued to enable cross chain functionality and interoperability.
11.2 WRAPPED TOKENS are not issued or exchanged for investment purposes. They are not documents of title, nor subject to any collateralization, security or right to exchange or redeem for NATIVE TOKENS.
11.3 WRAPPED TOKENS are not derivatives or financial instruments and carry no right of redemption or exchange.
11.4 WRAPPED TOKENS may have limited functionality. Whilst they may be traded with others there may not be any market for these or even willing buyers.
11.5 The exchange of WRAPPED TOKENS for NATIVE TOKENS relies on there being a willing counterparty to effect such exchange.
11.6 As the number of WRAPPED TOKENS in circulation should not exceed the total number of NATIVE TOKENS held in reserve by the issuer, the notional exchange rate is 1:1. WRAPPED TOKENS may be “burnt” when they are exchanged for NATIVE TOKENS. However, the notional exchange rate may diverge if there is any impairment or loss of the issuer’s reserves, technological failure, hacking, misuse, or inability or unwillingness of the issuer to make an exchange of NATIVE tokens for WRAPPED TOKENS.
11.7 Each WRAPPED TOKEN is a separate and distinct cryptographic asset.
12. REGULATORY RISK
12.1 New or changing laws and/or regulations, or interpretations of existing laws and/or regulations may materially and adversely impact the value of TOKENS, the liquidity of TOKENS, the ability to access marketplaces or exchanges, and/or the structure, rights and transferability of TOKENS.
12.2 Laws, regulations and/or directives may be adopted that affect the acquisition, holding or exchange of TOKENS. Such laws, regulations or directives may directly and negatively impact Our ability to issue TOKENS, exchange TOKENS, or do so at economic rates.
13. NO RIGHT TO PARTICIPATE
13.1 Holding or owning any TOKEN does not give You any right in any other cryptographic or real asset. Nor does it entitle You to vote or receive dividends or be deemed the holder of capital stock of INSTABRIDGE or any of its AFFILIATES. Nor shall such possession or ownership be construed to confer on the You or any holder of such TOKENS any rights similar to that of a stockholder or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof or to give or withhold consent to any corporate action or to receive notice of meetings or otherwise.
13.2 Ownership or possession of TOKENS does not make You a creditor or give You any interest in or right to participate in or make any claim against the assets of INSTABRIDGE or its AFFILIATES.
14. FAIR MARKETS
14.1 Crypto markets may not be subject to fair market rules. Low volumes of trading and minimal protection against insider trading may result in market manipulation and unfair trading practices which may cause You loss without recourse or compensation.
14.2 TOKEN markets may not be transparent and there may be no obligation or regulation that provides any audit or validation of the ownership, control, use or trading of TOKENS.
14.3 You may not be able to obtain all information you would wish to have access to in respect trading or markets on a timely basis or at all.
14.4 Markets, exchanges and issuers of TOKENS may have no obligation to issue risk warnings or notify You of technical, financial or economic changes or events that could materially affect your TOKENS, their value and/or utility.
15. DATA PROTECTION AND PRIVACY
15.1 Service providers are required to provide information as to the source of tokens, the identity of the parties to transactions and other information.
15.2 All transactions you undertake are visible. This will include disclosure of identification information, including your wallet address and financial information related to your transaction as published on the relevant LEDGER. BY EXECUTING ANY TRANSACTION OR POSSESSING TOKENS YOU CONSENT AND UNDERSTAND THAT THE DISCLOSURE OFSUCH IDENTIFICATION INFORMATION IS PERMANENT AND IRREVOCABLE.
16. MALICIOUS ATTACKS
16.1 As with other cryptocurrencies, the LEDGER used for the smart contract system is susceptible to attacks, including but not limited to double-spend attacks, majority mining power attacks, "selfish-mining" attacks and other LEDGER specific attacks.
16.2 Any successful attacks present a risk to the smart contract system, the expected proper execution and sequencing of TOKEN transactions, and the expected proper execution and sequencing of contract computations.
16.3 You understand and accept that the miners/validators of a particular LEDGER will ultimately be in control of TOKENS, and that most staking nodes or miners could agree at any point to make changes, updates, modifications to or effect a deletion or destruction of a TOKEN or smart contract system, and that such a scenario could lead to TOKENS losing intrinsic value and/or functionality.
THE FOREGOING RISK FACTORS DO NOT PURPORT TO BE AC COMPLETE EXPLANATION OF THE RISKS INVOLVED IN THIS OFFERING, YOU MUST CONSULT YOUR OWN PROFESSIONAL ADVISERS BEFORE DECIDING WHETHER TO ACQUIRE or exchange/substitute ANY TOKENS.
You should consider carefully the risks described below before making a decision to ACQUIRE, sell or exchange any tokens.
Instabridge shall not be liable for any losses incurred or suffered by users which have been caused or contributed to by events which arise from, OR are IN RELATION TO, a risk that IS identified below or which IS inherent in the creation, development OR issue of tokens or the operation of LEDGERS OR the creation OR use of wallet technology, including but not limited to those set out below.
The terms and conditions of use of the INSTABRIDGE service MAY BE FOUND at https://www.instabridge.io/terms
THE DEFINITIONS SET OUT IN THE INSTABRIDGE SERVICE TERMS AND CONDITIONS SHALL APPLY TO THESE TERMS.
1. THE NATURE OF TOKENS/ WRAPPED TOKENS
1.1 TOKENS have no intrinsic value. Nor does the possession or control of a TOKEN grant the TOKEN holder any contractual or non-contractual rights or privileges.
1.2 TOKENS are embodied or represented in and by the current state of a distributed ledger database.
1.3 PRIVATE KEYS enable the holder to initiate a change in the state of such distributed ledgers according to the protocols, rules and functionality of each such ledger. As such, the nature of the rights or property obtained by acquiring “TOKENS” are intangible and indeterminate.
1.4 TOKENS are not documents of title nor expressions of any right, title or interest in any property, asset or right.
2. RELIANCE OF SOFTWARE SYSTEMS
2.1 The use and benefits of possession, control or ownership of TOKENS or other digital assets are defined by and dependent on the software, systems, wallets, dApps, smart contracts, logic, interfaces and security protocols which facilitate the security, prevent duplicate transfers or exchanges, and permit interoperation with and execution of dApps, smart contracts or other third-party solutions. These may not function as you expect, may fail or may even be subject to malicious activity or errors.
2.2 Third party systems may/will be created, instantiated or controlled by third parties over whom neither You nor We have any control and who owe no contractual, statutory or other duties to You or Us.
2.3 The creators of LEDGERS, software, protocols, dApps, smart contracts, interfaces, wallets and related software and systems may not be identifiable, may not be located in any jurisdiction where you could secure a remedy against them and may not owe You any contractual, legal or other duty of care if the systems fail.
2.4 The operation of a distributed ledger, applications built on ledgers and the holding, operation and exchange of TOKENS involves a high degree of risk.
2.5 You acknowledge, understand and accept the risk of losing access to TOKENS due to loss of PRIVATE KEY(s), custodial fault, misfeasance by third-parties, hardware and software failures, hacking, code or human errors.
3. RISKS OF LOST OR COMPROMISED KEYS
3.1 You acknowledge, understand and accept that if Your private key(s) becomes lost, stolen or compromised or if you lose control over any device which is used to access or control such keys or access custodial arrangements relating to your TOKENS or You lose control of any credentials that provide access to LEDGER accounts, Your private key(s) will likely be irrecoverable and permanently lost and consequentially You will be unable to recover access to or control of any TOKENS relating to those keys.
3.2 Any third party that gains access to Your PRIVATE KEY(s), or any device or security protocol that controls access to or use of such keys, including by gaining access to the login credentials relating to the relevant wallet may be able to misappropriate Your TOKENS or prevent You from accessing or controlling the transfer, staking, un-staking or dealing with Your TOKENS.
4. RISK OF INCOMPATIBLE WALLET SERVICE
Wallet software or wallet service/custody services used to receive TOKENS and to manage the exchange of TOKENS must conform to the relevant token standard and the relevant LEDGER. Failure to maintain such conformity may result in You losing access to or control of Your TOKENS.
5. HARD FORKS
5.1 As part of development or upgrade, the LEDGER software may require a hard fork. If You decide not to adopt, or neglect to participate in, such upgrade You may no longer be able to use your TOKENS, and any non-upgraded or otherwise deprecated TOKENS may lose their utility in full.
5.2 In the event that there is a Hard Fork the WRAPPED TOKENS corresponding to the NATIVE TOKENS existing before such fork may cease to function as intended or at all.
6. COMPUTING RESOURCES
6.1 Available resources may prove inadequate to support TOKENS, which may delay or prevent the delivery or receipt of TOKENS.
6.2 Critical participants in the creation, maintenance and operation of the relevant LEDGER may cease to operate or take actions that result in non-functioning or reduced capacity to process transactions.
7. TAX
7.1 The tax treatment of TOKENS, and transactions involving TOKENS, is uncertain and dealings in TOKENS may result in substantial tax and reporting obligations.
7.2 You are responsible for obtaining advice as to your tax accounting and reporting obligations in connection with any dealings with TOKENS.
8. ADOPTION/ DIVERSITY OF OWNERSHIP
8.1 TOKENS may not be acquired or used by sufficient numbers of individuals, companies and other entities to create any meaningful market, exchangeability or useful function/utility.
8.2 The value, exchangeability and functionality of TOKENS and the security of LEDGERS may be adversely influenced by low diversity of ownership or counterparties and the volume/depth of any market for TOKENS.
9. NO STATUTORY OR OTHER COMPENSATION
9.1 Neither TOKENS nor the provision or use of wallets or custody have the benefit of statutory or other compensation schemes.
9.2 Tokens are not units of account. Ownership, risk of loss and impairment and possession are transferred by delivery of the TOKEN.
10. ABSENCE OF MARKET/MARKET MAKERS
10.1 There may be no market makers or available purchasers or sellers for TOKENS and those who create, develop and participate in respect of any particular LEDGER or application may choose not to enable or otherwise facilitate any secondary speculative trading or any such external valuation of TOKENS.
10.2 The absence of willing buyers and willing sellers may restrict the utility or purpose for using TOKENS and/or utility described in any disclosures, representations, White Papers or prospectuses.
10.3 Even if secondary trading of TOKENS is facilitated by third-party exchanges, such exchanges may be susceptible to fraud or manipulation.
10.4 Prices and value may be extremely volatile and diminish to zero. Further, prices may be affected by media announcements and/or relatively small sales or purchases of TOKENS.
10.5 Neither the loss of TOKENS nor the consideration you pay/deliver/exchange are subject to any guarantee, indemnity, insurance or other scheme and you will not be reimbursed by any governmental or other entity.
11. RISKS SPECIFIC TO WRAPPED TOKENS
11.1 WRAPPED TOKENS are issued to enable cross chain functionality and interoperability.
11.2 WRAPPED TOKENS are not issued or exchanged for investment purposes. They are not documents of title, nor subject to any collateralization, security or right to exchange or redeem for NATIVE TOKENS.
11.3 WRAPPED TOKENS are not derivatives or financial instruments and carry no right of redemption or exchange.
11.4 WRAPPED TOKENS may have limited functionality. Whilst they may be traded with others there may not be any market for these or even willing buyers.
11.5 The exchange of WRAPPED TOKENS for NATIVE TOKENS relies on there being a willing counterparty to effect such exchange.
11.6 As the number of WRAPPED TOKENS in circulation should not exceed the total number of NATIVE TOKENS held in reserve by the issuer, the notional exchange rate is 1:1. WRAPPED TOKENS may be “burnt” when they are exchanged for NATIVE TOKENS. However, the notional exchange rate may diverge if there is any impairment or loss of the issuer’s reserves, technological failure, hacking, misuse, or inability or unwillingness of the issuer to make an exchange of NATIVE tokens for WRAPPED TOKENS.
11.7 Each WRAPPED TOKEN is a separate and distinct cryptographic asset.
12. REGULATORY RISK
12.1 New or changing laws and/or regulations, or interpretations of existing laws and/or regulations may materially and adversely impact the value of TOKENS, the liquidity of TOKENS, the ability to access marketplaces or exchanges, and/or the structure, rights and transferability of TOKENS.
12.2 Laws, regulations and/or directives may be adopted that affect the acquisition, holding or exchange of TOKENS. Such laws, regulations or directives may directly and negatively impact Our ability to issue TOKENS, exchange TOKENS, or do so at economic rates.
13. NO RIGHT TO PARTICIPATE
13.1 Holding or owning any TOKEN does not give You any right in any other cryptographic or real asset. Nor does it entitle You to vote or receive dividends or be deemed the holder of capital stock of INSTABRIDGE or any of its AFFILIATES. Nor shall such possession or ownership be construed to confer on the You or any holder of such TOKENS any rights similar to that of a stockholder or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof or to give or withhold consent to any corporate action or to receive notice of meetings or otherwise.
13.2 Ownership or possession of TOKENS does not make You a creditor or give You any interest in or right to participate in or make any claim against the assets of INSTABRIDGE or its AFFILIATES.
14. FAIR MARKETS
14.1 Crypto markets may not be subject to fair market rules. Low volumes of trading and minimal protection against insider trading may result in market manipulation and unfair trading practices which may cause You loss without recourse or compensation.
14.2 TOKEN markets may not be transparent and there may be no obligation or regulation that provides any audit or validation of the ownership, control, use or trading of TOKENS.
14.3 You may not be able to obtain all information you would wish to have access to in respect trading or markets on a timely basis or at all.
14.4 Markets, exchanges and issuers of TOKENS may have no obligation to issue risk warnings or notify You of technical, financial or economic changes or events that could materially affect your TOKENS, their value and/or utility.
15. DATA PROTECTION AND PRIVACY
15.1 Service providers are required to provide information as to the source of tokens, the identity of the parties to transactions and other information.
15.2 All transactions you undertake are visible. This will include disclosure of identification information, including your wallet address and financial information related to your transaction as published on the relevant LEDGER. BY EXECUTING ANY TRANSACTION OR POSSESSING TOKENS YOU CONSENT AND UNDERSTAND THAT THE DISCLOSURE OFSUCH IDENTIFICATION INFORMATION IS PERMANENT AND IRREVOCABLE.
16. MALICIOUS ATTACKS
16.1 As with other cryptocurrencies, the LEDGER used for the smart contract system is susceptible to attacks, including but not limited to double-spend attacks, majority mining power attacks, "selfish-mining" attacks and other LEDGER specific attacks.
16.2 Any successful attacks present a risk to the smart contract system, the expected proper execution and sequencing of TOKEN transactions, and the expected proper execution and sequencing of contract computations.
16.3 You understand and accept that the miners/validators of a particular LEDGER will ultimately be in control of TOKENS, and that most staking nodes or miners could agree at any point to make changes, updates, modifications to or effect a deletion or destruction of a TOKEN or smart contract system, and that such a scenario could lead to TOKENS losing intrinsic value and/or functionality.
THE FOREGOING RISK FACTORS DO NOT PURPORT TO BE AC COMPLETE EXPLANATION OF THE RISKS INVOLVED IN THIS OFFERING, YOU MUST CONSULT YOUR OWN PROFESSIONAL ADVISERS BEFORE DECIDING WHETHER TO ACQUIRE or exchange/substitute ANY TOKENS.