Techemynt Risk Statement
When we say Techemynt, we, us or our, we mean Techemynt Limited (New Zealand registered Financial Service Provider Number FSP773214).
When we talk about you or your, we mean you, a person who accesses the Website, or a person who holds NZDS. Where applicable, this applies to your duly authorised representatives, legal personal representatives and successors.
Capitalised terms not defined in this risk statement are defined in the terms and conditions for the Website and NZDS, a copy of which is available here. (NZDS Terms).
You acknowledge having read and accepted this risk statement in its entirety, each time you:
- access or use our Website; or
- acquire, hold, use or dispose NZDS.
Acquiring, holding, using and disposing NZDS and using the platforms whether associated with the Website or not, involve risks, some but not all of which are set out below. These risks, and any additional risks not described below, arising either now or in the future, could result in your entire investment being lost. You must consider carefully whether the risks set out below, as well as all other applicable risks associated with a relevant platform are acceptable to you prior to acquiring NZDS. You must seek professional advice (legal, taxation, financial, technical or otherwise) regarding your particular situation before acquiring, holding, using or disposing of NZDS.
Volatility of Cryptoassets. The value of Cryptoassets, which includes NZDS, may be highly volatile. Factors such as market dynamics, regulatory actions and changes, technical advancements, as well as broader economic and political factors, may cause the value of your Cryptoassets to change significantly over a short period of time. In addition, there may be insufficient liquidity to support an active market in your Cryptoassets, or the market in your Cryptoassets may become susceptible to market manipulation.
Counterparty. A person holding property on trust for another person generally carries risks, including Techemynt’s holding of Trust Assets on bare trust. These risks include security breaches, risk of contractual breach, and risk of loss of the Trust Assets. You should be aware of the risks of acquiring an interest in trust property held by third parties.
Financial institutions. Custodians rely on third party financial institutions to hold their trust property such as the Trust Assets which Techemynt holds with certain registered banks or NBDTs. Legal title to such trust property passes to these financial institutions, and in turn, these institutions issue debt securities to custodians like Techemynt. These financial institutions do not hold this trust property on trust for custodians (such as Techemynt) or the ultimate beneficiaries to the trust property (such as NZDS holders). Such trust property may be subject to the risk of default, loss, theft, insolvency, illiquidity and governmental and regulatory freezes, seizures, inspections or information requests. These financial institutions have their own policies and may change their policies towards Cryptoassets without notice. This may result in delays or even barriers to your attempts to transfer fiat currency to custodians like Techemynt or attempts to redeem trust property from custodians.
Liquidity. Markets for Cryptoassets have varying degrees of liquidity. Thin markets can amplify volatility. There is never a guarantee that there will be an active market for you to sell, buy, or trade Cryptoassets or products derived from or ancillary to them. Further, any market for Cryptoassets may abruptly appear, vanish or be removed from an exchange.
Tax treatment and accounting. The purchase and sale of Cryptoassets may be subject to the tax laws in any applicable jurisdictions. The tax treatment and accounting of transactions in relation to Cryptoassets is uncertain and a largely untested area of law and practice that is subject to prospective and retroactive changes without notice. Tax treatment of Cryptoassets may vary across jurisdictions and you are solely responsible for understanding how Cryptoassets will be taxed under the laws applicable to you.
Regulatory risk: The legal status of Cryptoassets (including NZDS) may be uncertain. This means the implications of issuing, buying, holding, using and selling Cryptoassets will not be certain. The legal treatment of Cryptoassets may vary across jurisdictions and you are solely responsible for understanding how Cryptoassets will be treated under the laws applicable to you in all respects.
Reliance on the internet. Cryptoassets, the Website and any related or third party platform rely heavily on the internet. However, the public nature of the internet means that either parts of the internet or the entire internet may be unreliable or unavailable at any given time. Further, interruption, delay, corruption or loss of data, the loss of confidentiality in the transmission of data, or the transmission of malware may occur when transmitting data via the internet.
Reliance on technology. Cryptoassets rely on sophisticated software applications, many of which in turn rely on unpermissioned blockchains or similar or competing technology. NZDS currently exists on the Ethereum blockchain and therefore relies on the Ethereum network. The Ethereum network and most other similar technology is open source software that is built upon experimental technology, namely blockchain. Risks arising from technology include (but are not limited to): (a) the existence of technical flaws; (b) targeting by malicious persons; (c) majority-mining, consensus-based or other mining attacks; (d) changes in consensus protocol or algorithms; (e) decreased community or miner support; (f) rapid fluctuations in the value of the underlying crypto; (g) the existence or development of competing networks and platforms; (h) the existence or development of “forked” versions; (i) flaws in the scripting language and code, including Solidity in the case of the Ethereum network; (j) disputes between developers, nodes, miners and/or users; and (k) regulatory action. NZDS may in the future migrate (in whole or in part) to other blockchains which are likely to have the same or similar risks as the Ethereum network.
Cryptographic advancements. Developments in cryptographic technologies and techniques, including the advancement of artificial intelligence and/or quantum computing, pose security risks to all cryptography-based systems, including Cryptoassets. Applying these technologies and techniques to Cryptoassets and/or a platform may result in theft, loss, disappearance, destruction, devaluation or other compromises of your Cryptoassets, the platform or your data.
Cryptoasset transactions. Cryptoasset transactions on unpermissioned blockchains are irreversible and entities like Techemynt will not be able to reverse or recall any such transaction once initiated. You bear all responsibility for any losses that may be incurred in connection with sending Cryptoassets to an incorrect or unintended address.
Source code changes and flaws. The various source codes used in Cryptoassets and associated platforms is subject to change and may at any time contain one or more defects, weaknesses, inconsistencies, errors or bugs.
No anonymity. Your participation in receiving, holding and transferring Cryptoassets and/or use of a platform will not be anonymous on the Ethereum (or other) network. Your address and such participation will be recorded on an unpermissioned blockchain like Ethereum. It is possible for people, including regulatory authorities, to match your addresses to your identity.
Loss of private key is permanent and irreversible. You alone are responsible for securing your private key to your wallet which holds Cryptoassets (such as NZDS). Losing control of your private key will permanently and irreversibly deny you access to your Cryptoassets. Neither we nor any other person will be able to retrieve or protect your Cryptoassets. Once lost, you will not be able to transfer your Cryptoassets to any other address or wallet. You will not be able to realise any value or utility that the Cryptoasset may hold now or in future.
Targeting of Cryptoassets, blockchains and platforms by malicious persons. Cryptoassets, blockchains and platforms may be targeted by malicious persons who may attempt to steal Cryptoassets or otherwise interfere with the correct operation of a platform. This includes (but is not limited to) interventions by way of: (a) distributed denial of service; (b) Sybil Attacks; (c) phishing; (d) social engineering; (e) hacking; (f) smurfing; (g) malware; (h) double spending; (i) majority-mining, consensus-based or other mining attacks; (j) misinformation campaigns; and (k) spoofing.
Targeting by malicious persons. Malicious entities may target you in an attempt to steal any Cryptoassets or cryptocurrencies that you may hold, or to claim any Cryptoassets that you may have purchased. This may involve unauthorised access to your wallet, your private keys, your Cryptoasset addresses, your email or social media accounts, as well as unauthorised access to your computer, smartphone and any other devices that you may use. You alone are responsible for protecting yourself against such actions.
Valuation. Trust property such as the Trust Assets are not insured and could be subject to unforeseeable or significant reductions in value at any time. This may result in delays and other barriers to redemptions for instance. Cryptoassets like NZDS are not a fiat currency and are not issued, backed, or guaranteed by any government. As with all investments, there is a risk of loss in owning Cryptoassets.
Currency fluctuations. Although NZDS is not fiat currency, it is intended (although not guaranteed) that it will closely follow the value of the New Zealand Dollar. That currency itself is subject to fluctuation in its value brought about by market conditions, Government and central bank policies and the comparative value of other currencies (amongst other things). By acquiring, holding, using or selling NZDS you will be exposed to all of the foregoing risks.
Redemptions. Redemptions of fiat currency from custodians like Techemynt are subject to custodians’ completion of CDD checks on redemption applicants, like yourself, to their satisfaction. Such checks will take an unforeseeable amount of time to complete and it will likely result in costs or delays to you. It is possible that such checks may not be able to be completed on you at all, therefore you will not be able to redeem fiat currency from your custodians or otherwise dispose of your Cryptoassets. You may be required to provide additional information or give confirmations or declarations in order to allow us to meet our obligations under law or regulation.
Unknown risks. Cryptoassets are a fast-evolving asset class and technology. There are things that will be discovered in the development process which at this point cannot be predicted. We may not yet know all the risks that will be associated with any particular platform or Cryptoasset.