All terms used in this risk disclosure, which are defined in the Terms of Services, have the same meaning and construction as in the Terms of Services.
Each YAX service has its own distinct risks and this risk disclosure provides you with general description of the risks associated when you use YAX services. This risk disclosure does not explain all of the risks or how such risks relate to your personal circumstances. It is important that you fully understand the risks involved before making a decision to use YAX services.
For the purpose of this risk disclosure, “Virtual Assets” means any virtual asset as defined in section 53ZRA of the AMLO (see below) and any Security Token (cryptographically secured digital representation of value which constitutes “securities” as defined in section 1 of Part 1 of Schedule 1 to the SFO).
Virtual assets as defined in section 53ZRA of the AMLO:
(a) a cryptographically secured digital representation of value that—
(i) is expressed as a unit of account or a store of economic value;
(ii) either—
(A) is used, or is intended to be used, as a medium of exchange accepted by the public, for any one or more of the following purposes—
(I) payment for goods or services;
(II) discharge of a debt;
(III) investment; or
(B) provides rights, eligibility or access to vote on the management, administration or governance of the affairs in connection with, or to vote on any change of the terms of any arrangement applicable to, any cryptographically secured digital representation of value;
(iii) can be transferred, stored or traded electronically; and
(iv) satisfies other characteristics prescribed by the Commission under subsection (3)(a) of section 53ZRA of AMLO; or
(b) a digital representation of value prescribed as a virtual asset by notice published under subsection (4)(a) of section 53ZRA of AMLO.
Subscribing for any Virtual Asset related products or services involves a high degree of risk. Virtual Assets are not legal tender, their value may not be backed or supported by any government or authority. As such, Virtual Assets may suffer significant volatility in value. Virtual Asset related products and services are not principal guaranteed and you may lose a part or the entirety of the principal invested in such Virtual Asset related products and services. The protection offered by the Investor Compensation Fund does not apply to transactions involving Virtual Assets (irrespective of the nature of the tokens). Therefore, it is unlikely that you will be able to recover any of your losses suffered.
Virtual Assets are highly risky and you should carefully consider the risk exposure and exercise caution in relation to the products and services. You must have the financial ability, sophistication, experience, tolerance and willingness to bear the risks of any Virtual Asset related products or services and a potential total loss of the underlying assets before investing. Virtual Asset related products or services are not suitable for every client. Please carefully review your financial situation and objectives to determine whether such product or services is suitable for you.
Given the nature of Virtual Assets and their underlying technologies, there are a number of intrinsic risks, including but not limited to: (a) distributed ledger technologies are still at an early stage of maturity, with many of these networks having been created only recently, so they may not be sufficiently tested and there may be significant flaws in their operation and security; (b) The transaction log in networks based on distributed log technologies operates through consensus protocols that may be susceptible to attacks that attempt to modify the transaction log and, in the event of a successful attack, there would be no alternative log to support such transactions and thus the balances corresponding to the public keys, and all Virtual Assets could be lost; (c) transactions in Virtual Assets are irreversible. Consequently, losses due to fraudulent or accidental transactions may not be recoverable; and (d) potential delays due to technology or system may cause a transaction not be settled on the scheduled delivery date. The nature of Virtual Assets means that any technological difficulties experienced by YAX may prevent you from accessing your Virtual Assets.
The nature of Virtual Assets exposes them to an increased risk of fraud or cyberattack. It is not possible for YAX to eliminate all security risks. You are responsible for keeping your account password safe, and you may be responsible for all the transactions under your account, regardless of whether you have authorised them or not.
Third parties, such as payment providers, custodians, and banking partners may be involved in the provision of YAX services. You may be subject to the terms & conditions of these third parties, and YAX may not be responsible for any loss that these third parties may cause to you.
Offering documents or product information provided by Virtual Asset issuers have not been subject to scrutiny by any regulatory body and may potentially contain false or misleading statements. You should exercise caution when reading the applicable product terms, documents, white paper, risk disclosures or any other relevant documents distributed by Virtual Asset issuers.
No YAX entity is or is regulated as a bank or any other type of depository institution in any jurisdiction. Virtual Assets held in your Account are not eligible for any public or private deposit insurance protection or any other protection programs of similar nature. You will not earn any interest on your Account.
Virtual Asset trading is subject to high market risk and price volatility. Changes in value may be significant and may occur rapidly and without warning. Past performance is not a reliable indicator of future performance. The value of an investment and any returns can go down as well as up, and you may not get back the amount you had invested.
The value of a Virtual Asset may be derived from the continued willingness of market participants to exchange fiat currency for a Virtual Asset, which means that the value of a particular Virtual Asset may be completely and permanently lost should the market for that Virtual Asset disappear. There is no assurance that a person who accepts a Virtual Asset as payment today will continue to do so in the future.
The market conditions of Virtual Assets related products or services may change significantly fast and drastically. Virtual Assets related products or services may have limited liquidity at any time, especially at times of rapid price movements, which may make it difficult or impossible for you to sell or exit a position under the desirable terms or timeframe. You acknowledge and agree that you are solely responsible to bear all the relevant risks.
Gapping is the sudden shift in the price of an underlying Virtual Asset from one level to another. Various factors can lead to gapping (for example, economic events or market announcements). When these factors occur, the price of Virtual Assets may move rapidly and drastically and you may not have the opportunity to sell your instruments. It is possible that stop losses will not be triggered in a timely manner, potentially leading to substantial losses.
Virtual Asset markets are open 24 hours a day, 7 days a week. Rapid price changes may occur at any time, including outside of normal business hours.
The insolvency or default of any exchanges or brokers involved with the Virtual Assets related products or services may lead to your trading positions being liquidated or closed out without your consent. In certain circumstances, you may lose the entire assets that you have invested.
We do not guarantee that the YAX services will be available at any particular time or that YAX services will not be subject to unplanned service outages or network congestion. It may not be possible for you to buy, sell, store, transfer, send or receive Virtual Assets when you wish to do so.
In addition, there are legal requirements in various countries/regions which may restrict the products and services that YAX can lawfully provide. Accordingly, some products and services and/or certain functionality within the YAX’s platform may not be available or may be restricted in certain jurisdictions or regions or to certain investors and any YAX campaigns, user competitions or other promotions will not be accessible to (and are not targeted at or intended for) investors to whom restrictions apply. You are responsible for informing yourself about and observing any restrictions and/or requirements imposed with respect to the access to and use of the YAX’s platform and the YAX services in each jurisdiction from which the YAX’s platform and the YAX services are accessed by or on behalf of the investors. YAX reserves the right to change, modify or impose additional restrictions with respect to the access to and use of the YAX’s platform and/or the YAX services from time to time in its sole discretion without notification.
When you communicate with us via electronic communication, you should be aware that electronic communications can fail, can be delayed, may not be secure and/or may not reach the intended destination.
Virtual Assets may or may not be considered “property” under the law, and such legal uncertainty may affect the nature and enforceability of your interest in such Virtual Assets.
Legislative and regulatory changes may adversely affect the use, transfer, exchange and value of Virtual Assets. This risk is unpredictable and may vary from market to market. You are responsible for determining whether the use of any of the YAX services is legal in your jurisdiction and you shall not use the services should such use be illegal in your jurisdiction. If investors are uncertain, they are encouraged to seek independent legal advice.
In addition, investors should note that their Virtual Assets are held by YAX in custodial wallets. This means that investors do not hold the private keys to those wallets and are consequently not the direct holder of the Virtual Assets in those wallets. YAX may also use shared blockchain addresses to hold Virtual Assets of investors. Although YAX maintains segregated books for investors and their accounts, YAX shall have no obligation to segregate such Virtual Assets through different blockchain addresses. This setup described above means that investors are likely to be treated as general unsecured creditors in the event of any bankruptcy proceedings.
You shall be aware of the currency in which your Account on the YAX Platform is denominated (the “Default Currency”). You shall be solely responsible to bear any currency exchange risk if you choose a currency other than the Default Currency as denomination for your Account when using the Services.
From time to time, we may provide information to you which presents your multi-currency balances in the equivalent value of your Default Currency, using the rates prevailing at the time the information is produced. However, you should note that the balances have not been physically converted and that the presentation of the information in your Default Currency is for information only.
Currency exchange fluctuations will impact investor’s gains and losses. The extreme volatility and unpredictability of the price of a Virtual Asset relative to fiat currencies may result in a total loss of the investment over a short period of time.
OTC transaction may carry increased risks since it may be difficult to liquidate an existing position, determine a fair price or assess exposure to risk. OTC transactions are less transparent than those carried out on recognized exchanges.
When utilizing our OTC Services for the exchange of fiat currency with virtual assets and vice versa, you are subject to our counterparty risk under an OTC transaction. As OTC transactions are typically conducted directly between parties without the oversight of a central clearinghouse, there exists the possibility that the counterparty may fail to fulfill their obligations, leading to potential financial losses. You should note that we are not regulated by any financial regulator and as such, you may not receive any regulatory protection at all. You should cautiously consider whether it would be in your best interest to enter into OTC transactions with us, conduct appropriate due diligence on us and the relevant product to assess comparative credit risk before proceeding with the OTC transaction, and seek independent professional advice if in doubt.
We do not provide personal advice in relation to our products or services. We sometimes provide factual information, information about transaction procedures and information about the potential risks. However, any decision to use our products or services is made by you. No communication or information provided to you by YAX is intended as, or shall be considered or construed as, investment advice, financial advice, trading advice, or any other sort of advice. You are solely responsible for determining whether any investment, investment strategy or related transaction is appropriate for you according to your personal investment objectives, financial circumstances and risk tolerance.
YAX is not your broker, intermediary, agent, or advisor and has no fiduciary relationship or obligation to you in connection with any trades or other decisions or activities undertaken by you using YAX services. We do not monitor whether your use of YAX services is consistent with your financial goals and objectives. It is up to you to assess whether your financial resources are adequate for your financial activity with us, and to your risk appetite in the products and services you use.
The taxation of Virtual Assets is uncertain, and you are responsible for determining what taxes you might be liable to, and how they apply, when transacting through the YAX services. It is your responsibility to report and pay any taxes that may arise from transacting on the YAX services, and you acknowledge that YAX does not provide legal or tax advice relative to these transactions. If you have any doubts about your tax status or obligations when using YAX services, or with respect to the Virtual Assets held to the credit of your account, you are encouraged to seek independent advice.
You acknowledge that, when, where and as required by applicable legislation, YAX shall report information regarding your transactions, transfers, distributions or payments to tax or other public authorities. Similarly, when, where and as required by applicable law, YAX shall withhold taxes related to your transactions, transfers, distributions or payments. Applicable legislation could also prompt YAX to request you for additional tax information, status, certificates or documentation. You acknowledge that failure to answer these requests within the timeframe defined, may result in withholding taxes by YAX, to be remitted to tax authorities as defined by relevant law. You are encouraged to seek professional and personal tax advice regarding the above and before making any Virtual Asset transaction.
Our fees and charges are set out on our website/platform. YAX may, in its discretion, update the fees & charges from time to time. Please be aware of all costs and charges that apply to you, because such costs and charges will affect the gains you generate from using YAX services.
To summarize, the clients shall be aware of the following risks related to Virtual Asset.
(a) virtual assets are highly risky and investors should exercise caution in relation to the products;
(b) a virtual asset may or may not be considered “property” under the law, and such legal uncertainty may affect the nature and enforceability of a client’s interest in such virtual assets;
(c) the offering documents or product information provided by the issuer have not been subject to scrutiny by any regulatory body;
(d) the protection offered by the Investor Compensation Fund does not apply to transactions involving virtual assets (irrespective of the nature of the tokens);
(e) a virtual asset is not a legal tender, i.e., it is not backed by the government and authorities;
(f) transactions in virtual assets may be irreversible, and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable;
(g) the value of a virtual asset may be derived from the continued willingness of market participants to exchange fiat currency for a virtual asset, which means that the value of a particular virtual asset may be completely and permanently lost should the market for that virtual asset disappear. There is no assurance that a person who accepts a virtual asset as payment today will continue to do so in the future;
(h) the extreme volatility and unpredictability of the price of a virtual asset relative to fiat currencies may result in a total loss of the investment over a short period of time;
(i) legislative and regulatory changes may adversely affect the use, transfer, exchange and value of virtual assets;
(j) some virtual asset transactions may be deemed to be executed only when recorded and confirmed by YAX, which may not necessarily be the time at which the client initiates the transaction;
(k) the nature of virtual assets exposes them to an increased risk of fraud or cyberattack; and
(l) the nature of virtual assets means that any technological difficulties experienced by YAX may prevent clients from accessing their virtual assets.