Tezos (XTZ)

INTRODUCTION
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There have been no expressed opinions by a regulatory authority in Canada about Tezos or any of the other Crypto Contracts or Crypto Assets made available through Satstreet Inc., including an opinion that Tezos 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 Tezos 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

Tezos is a coin created by a former Morgan Stanley analyst, Arthur Breitman. It is a smart contract platform which is does not involve in mining Tezos coins. It is a coin that focuses on major ideas of self-amendment and on-chain governance. It is an Ethereum-like blockchain that hosts smart contracts. It allows the community to vote and improve its flaws. Any token holder may delegate their voting rights to others in the network. The coin uses a generic network shell which allow different transaction and consensus protocols that a blockchain needs to be compatible. The source code is implemented on OCaml which is a fast, flexible and functional programming language. Tezos’ proof-of-stake consensus algorithm is different from the delegated proof-of-stake (dPOS) where they go by the name liquid proof-of-stake. The staking process in Tezos is called “baking”. In this blockchain, bakers who make deposits will be rewarded for signing up and publishing blocks. However, if a baker commits any bad behavior the deposits will be forfeited.
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Tezos (XTZ) : https://whitepaper.io/document/376/tezos-whitepaper
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RISKS OF XTZ

Any investment in cryptocurrency and digital assets, such as XTZ, 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, XTZ has no central working group or authority to disclose material information to the public regarding XTZ. 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 XTZ.  We encourage all users to perform their own due diligence to assess the risks associated with XTZ and to determine whether this level of risk is acceptable to them.  Neither XTZ nor Satstreet guarantees the value of XTZ, and holders of XTZ will not have any recourse to XTZ or Satstreet if the value of XTZ declines for any reason whatsoever.

SATSTREET EVALUATION OF XTZ

Satstreet Inc. has reviewed and assessed XTZ prior to making it available through our services and has concluded that XTZ 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 XTZ 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 XTZ, including an opinion that XTZ is not itself a security and/or derivative. Based on publicly available information Satstreet has reviewed XTZ, including, but not limited to, a review of the following: The creation, governance, usage, and design of XTZ, including the source code, security, and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that created XTZ. The supply, demand, maturity, utility, and liquidity of XTZ. Material technical risks associated with XTZ, including any code defects, security breaches and other threats concerning XTZ 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 XTZ, including (i) any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of XTZ, 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 XTZ about whether XTZ, or generally about whether the type of crypto asset, is a security and/or derivative.

Last Updated: June 2023