ETH Risk

ETHEREUM (ETH)

INTRODUCTION

‍There have been no expressed opinions by a regulatory authority in Canada about Ethereum or any of the other Crypto Contracts or Crypto Assets made available through Satstreet Inc., including an opinion that Ethereum itself is not a security and/or derivative. There may be sudden changes without notice to applicable laws that may adversely affect the value, use, transfer, or exchange of any of your crypto assets. The statutory rights of action for damages and the right of rescission in section 130.1 of the Securities Act (Ontario) and similar legislation in the other provinces and territories of Canada would not apply in respect of a misrepresentation in this Crypto Asset Statement or the Satstreet Inc. Services Risk Statement. The below provides a summary of risks associated with Ethereum and is not a complete list of all risks and does not take into account an individual’s specific risk tolerance or situation. Investors are encouraged to conduct their own research prior to trading any crypto asset. Satstreet Inc. clients should read the Satstreet Inc. Services Risk Statement for the general risks associated with crypto assets made available through Satstreet Inc.. A copy of the Satstreet Services Risk Statement is available at https://satstreet.com/services/risk-statements
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DESCRIPTION
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Ethereum is a decentralized, open-source blockchain platform that was introduced in 2015 by Vitalik Buterin and a team of developers. It was designed to enable the creation and execution of smart contracts, which are self-executing agreements with predefined conditions that automatically trigger actions when those conditions are met. Ethereum utilizes its native cryptocurrency called Ether (ETH) as a means of value exchange within the network.

Ethereum aims to be a programmable platform for decentralized applications (DApps) and decentralized finance (DeFi). It provides developers with a robust and flexible environment to build and deploy smart contracts and DApps using its native programming language, Solidity. Ethereum's blockchain maintains a record of all executed smart contracts and transactions for the possibility of better transparency and immutability.

Ethereum (ETH) Whitepaper: https://ethereum.org/en/whitepaper/

RISKS

Any investment in cryptocurrency and digital assets, such as Ethereum, can include the following general risks:
(i) volatility risk and liquidity risk
(ii) short history risk
(iii) demand risk
(iv) forking risk
(v) code defect risk
(vi) regulatory risk
(vii) electronic trading risk
(viii) cyber security risk

For additional information of risks associated with cryptocurrency and digital assets, you may refer to the Satstreet Inc Services Risk Statement. In terms of specific risks, as Ethereum has no central working group or authority to disclose material information to the public regarding Ethereum. Please note that these risks and the associated summaries or overviews provided for each herein are not intended to be a complete overview of all such risks and, in addition, there may be other risks that come with exposure to Ethereum. We encourage all users to perform their own due diligence to assess the risks associated with Ethereum and to determine whether this level of risk is acceptable to them. Neither Ethereum nor Satstreet guarantees the value of Ethereum, and holders of Ethereum will not have any recourse to Ethereum or Satstreet if the value of Ethereum declines for any reason whatsoever.

SATSTREET EVALUATION OF ETHEREUM

Satstreet Inc. has reviewed and assessed Ethereum prior to making it available through our services and has concluded that Ethereum is not a security or derivative under Canadian securities legislation; however, there is a risk that this conclusion could change in the future and that, in such event, Satstreet will be required to halt, suspend, and then remove Ethereum from its platform as described in the Satstreet Inc. Services Risk Statement. Further, as indicated above, no Canadian securities regulatory authority has expressed an opinion about Ethereum, including an opinion that Ethereum is not itself a security and/or derivative. Based on publicly available information Satstreet has reviewed Ethereum, including, but not limited to, a review of the following: The creation, governance, usage, and design of Ethereum, including the source code, security, and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that created Ethereum. The supply, demand, maturity, utility, and liquidity of Ethereum. Material technical risks associated with Ethereum, including any code defects, security breaches and other threats concerning Ethereum and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them. Legal and regulatory risks associated with Ethereum, including (i) any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of Ethereum, and (ii) statements made by any securities regulatory authorities in Canada, other regulators in IOSCO-member jurisdictions, or the regulator with the most significant connection to Ethereum about whether Ethereum, or generally about whether the type of crypto asset, is a security and/or derivative.

Last Updated: June 2023

Risk Statements

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