I. General Provisions and Application
1. Introduction
Top Line Ltd., the private company, (hereinafter - the ‘Company') is the entity registered as a participant of the Astana International Financial Centre (hereinafter - the ‘AIFC’) and engaged into the following regulated and market activities:
- Operating a Digital Asset Trading Facility;
- Providing Custody;
The regulatory body executing the supervisory functions on the territory of the AIFC is the Astana Financial Services Authority (hereinafter - the ‘AFSA'). AFSA has powers to authorise, supervise, and where necessary, carry out enforcement in regard to AIFC participants.
2. Regulatory framework
The legislation applicable on the territory of AIFC is based on Constitutional Statute of the Republic of Kazakhstan on the Astana International Financial Centre No. Ns 438-V ZRK of 7 December 2015, as well on the acts of AIFC and AIFC Bodies.
Financial services legislation is based on the Rules and the Regulations established by AFSA. The Company complies to AIFC Conduct of Business Rules AIFC Rules No. FR0005 of 2017 (hereinafter - the ‘COB Rules') and to AIFC Financial Technology Rules No. AFSA-F-PC-2019-0001 of 2019 (hereinafter - the ‘FinTech Rules') in order to meet the standards of conduct expected of FinTech firms operating at AIFC.
3. Purpose of the Disclaimer
Issuing, trading, transacting, investing and holding positions in Digital Assets entails special risks to the Client, including technological, operational, market and systemic risks as well as legal, regulatory and tax risks that may differ from and/or apply in addition to those existing in relation to traditional assets including any traditional financial instruments or national and supranational currencies. In a worst case scenario, the realization of such risks may result in a total loss of the Client's investment and potentially additional losses in excess of the original investment, depending on the type of Digital Asset and the specifics of the Client's investment activity and exposure.
II. Digital Asset
1. Digital Asset in general
Digital Assets are an evolving, non-uniform asset class characterized by the use of distributed ledger technology ("DLT") or similar technology. More specifically, Digital Assets are dematerialized assets constituted and existing as entries on a public, permissioned or private blockchain or other digital, distributed ledger only. The relevant distributed ledgers themselves and any data stored therein, including without limitation the Digital Assets as such or any references thereto, are, unless explicitly specified otherwise in relevant documentation, not operated nor controlled by Company and therefore outside of the sphere of influence of Company.
In particular, Digital Assets may constitute native units of value that do not include or represent any claim against an issuer or another third party. Where such units are intended or used for payment purposes and do not qualify as nor represent securities or other financial instruments, they are sometimes referred to as payment tokens or (pure) crypto currencies ("Crypto Currencies").
Other types of Digital Assets may (i) constitute or represent any form of traditional, non-traditional or exotic financial instruments including shares, bonds, fund units, structured products or derivatives (sometimes referred to as asset tokens), (ii) grant a right of use to a digital service, platform or infrastructure (sometimes referred to as utility tokens, or (iii) constitute a hybrid form of any of the aforementioned types of Digital Assets, including Crypto Currencies (sometimes referred to as hybrid tokens). Depending on their specific structure and depending on the rules of various jurisdictions, Digital Assets may, irrespective of the terminology used by an issuer or other involved parties, qualify as securities (in such case sometimes referred to as security tokens) or other forms of financial instruments, with the associated legal and regulatory consequences, in particular if they are suitable for investment purposes.
While based on DLT, Digital Assets may be subject to centralisation effects, e.g. due to concentration of ownership of issued/pre-mined units with the issuer, another single party or a small number of related or unrelated parties, or due to concentration of network functions such as node operation or transaction validation with a single party or a small number of related or unrelated parties. This may cause Digital Assets to display characteristics of centrally issued instruments and/or may result in potentially detrimental effects for parties other than those participating in or having any effect on the concentration of ownership or network functions.
2. Digital Asset Glossary
Airdrop means a distribution of Crypto Currency or other Digital Asset units to a defined scope of wallet addresses, usually without any compensation in order to promote a new virtual currency. It is often done to gain attention and new followers, resulting in a larger user base and a wider disbursement of coins.
DLT (Distributed Ledger Technology), referring to technology enabling the implementation of databases distributed on different nodes, or computer devices in a network, each of which may individually participates in the network by replicating and saving a copy of the ledger or parts of it.
Node is a computer that participates in a DLT network.
Miner/Minter Refers to a device or person that operates the device performing an act of creating valid blocks.
Miner refers to a device or person responsible for performing the action of creating valid blocks.
Some protocols require demonstrating proof of work (done by “Miners”) while other consensus mechanisms require the staking of the assets (done by “Minters”). In addition to the Miners and Minters, there are other consensus mechanisms which require different devices or persons, such as for example “Validators” in byzantine fault tolerant mechanisms.
Blockchain A specific form of database based on DLT that employs a chain of blocks to reach consensus on the distributed ledger (DL).
Consensus In the context of DLT consensus refers to the process (algorithm or mechanism) used to bring the distributed database to a synchronized state at a particular time or block.
Hard fork A consensus affecting protocol change to which the participants that did not adopt the change will not be able to continue validating and verifying transactions.
Soft fork A consensus affecting protocol change to which the participants that did not adopt the change will still be able to participate in validating and verifying transactions.
51% attack A 51% attack is a potential attack on a blockchain network, where a single entity or organization is able to control a high percentage of the hash rate, potentially causing a network disruption. In such a scenario, the attacker would have enough mining power to intentionally exclude or modify the ordering of transactions. Such attacker could potentially also reverse transactions, putting it in a position to double-spend the same unit of a Digital Asset. A successful majority attack would further allow the attacker to prevent some or all transactions from being confirmed (transaction denial of service) or to prevent some or all other miners from mining, resulting in what is known as mining monopoly (censorship attack).
Collision Attack on a cryptographic hash tries to find two inputs producing the same hash value, i.e. a hash collision. This type of cryptographic attack exploits the mathematics behind the birthday problem in probability theory and depends on the higher
III. DISCLAIMER OF WARRANTIES
1. General Disclaimer: Unless explicitly stated or where prohibited by applicable law, all services, materials, and other items provided by or on behalf of CaspianEx are presented on an "as is" and "as available" basis. CaspianEx disavows all warranties, whether express or implied, other than those expressly enumerated in these terms.
2. No Implied Warranties: Specifically, CaspianEx denies any implied warranties of merchantability, fitness for a particular purpose, title, and non-infringement. CaspianEx does not warrant that the provided services or materials will meet your needs or that their functionality will be smooth or error-free.
3. Specific Disclaimers: CaspianEx neither guarantees nor professes:
The complete accuracy, reliability, or timeliness of the CaspianEx site, services, or materials.
That the site, services, or materials will be free of viruses, malicious software, or other harmful entities.
The definite execution, acceptance, recording, or persistence of any order.
4. Non-Reliance: Beyond the clear provisions of these terms, you affirm that you have not relied on any other oral or written statements or agreements concerning your usage and access to CaspianEx's services.
IV. EXCLUSIONS FROM LIABILITY
1. CaspianEx shall not be held accountable for losses or damages related to:
1.1. Erroneous, incomplete, or obsolete digital asset pricing data.
1.2. Delays, errors, or interruptions in the conveyance of digital asset data.
1.3. Any unplanned or scheduled maintenance and the resulting interruptions or modifications due to such maintenance.
1.4. Damages due to the actions or inactions of other users violating these terms.
1.5. Damages emanating from unauthorized or illegal actions by third-party entities.
1.6. Market Volatility: CaspianEx is not responsible for losses or damages arising from market volatility. The client assumes all risks associated with the high volatility of the digital asset market. In cases where there's a loss of digital assets due to market fluctuations, the client shall have no claims against CaspianEx.
1.7. Any other exceptions and stipulations outlined in CaspianEx's platform rules and specific disclaimers.
V. LIMITATION OF LIABILITY
1. General Limitation: Except where forbidden by applicable law or in situations involving CaspianEx's gross negligence, fraud, willful misconduct, or intentional legal infractions, neither CaspianEx nor its affiliates shall be liable for any special, consequential, incidental, punitive, or indirect damages arising from the services or products offered.
2. Jurisdictional Restrictions: Some jurisdictions might impose regulations that restrict the exclusion or limitation of specific damages; hence, the aforementioned limitations may not apply in those areas.
3. Capped Liability: Irrespective of the circumstances or legal rationale, the aggregate liability of CaspianEx (and its affiliates) arising from or connected to the services or products supplied shall not surpass the total fees you've remitted to CaspianEx under these terms during the twelve months leading up to the event causing the claim.
VI. GOVERNING LAW AND DISPUTE RESOLUTION
1. Jurisdiction: This document is governed by the laws of the Astana International Financial Centre (AIFC) jurisdiction.
2. Dispute Resolution: Any disputes or claims arising out of or in connection with this document, or the breach, termination, or invalidity thereof, shall be settled by arbitration in accordance with the AIFC International Arbitration Centre (IAC) Arbitration Rules.
VII. RISKS SPECIFIC TO DIGITAL ASSETS
1. Technology risks
Risks of Digital Assets stemming from or relating to the specific use of technology may include, without limitation:
- Risk of Digital Assets existing on a distributed ledger only: Unless explicitly specified otherwise, the distributed ledgers by which and on which Digital Assets exist are outside of the sphere of influence of Company. Digital Assets can be exposed to events specific to the relevant distributed ledger such as hard or soft forks in a blockchain which may inter alia lead to the creation of new or competing Digital Assets, adversely affect the functionality, convertibility or transferability or result in a full or partial loss of units or reduction (including reduction to zero) of value of the Client's Digital Assets.
- Risk of irreversibility of transactions/faulty instructions: Base layer transactions on a blockchain or other distributed ledger are irreversible and final and the history of transactions is computationally impractical to modify (i.e. would require more computing power than is reasonably expected to be available to any one person or group at any time). As a consequence, if the Client initiates or requests a transfer of Digital Assets using an incorrect digital ledger address, it will be impossible to identify the recipient and reverse the defective transaction. This risk also applies if the Client attempts to transfer Digital Assets to Company using an incorrect digital ledger address.
- Risk of delayed execution: The execution of transactions in Digital Assets on a blockchain or other distributed ledger is subject to verification and other processes involving multiple third party actors/nodes using evolving technology. This may result in significant waiting periods and delays during which the Client may be precluded from disposing over the relevant Digital Assets while their value may fluctuate significantly or which may otherwise result in loss or damages.
- Risk of security weaknesses within the underlying code or technology: There is a risk that developers or other third parties may voluntarily or involuntarily introduce weaknesses or errors into the underlying code or technology of a Digital Asset, which may be exploited in various types of attacks. Successful attacks (or the perception of a technological weakness) might adversely affect the functionality, convertibility or transferability or result in a full or partial loss of units or reduction (including reduction to zero) of value of the Client's Digital Assets.
- Risk of exploitable breakthroughs in the field of cryptography, e.g. development of quantum computers: The state-of-the-art in cryptography, including digital encryption, may evolve over time. Advances in code decryption techniques and technical advances (including with regard to the computing power required to deploy such techniques) could pose risks to the security of Digital Assets and, if exploited, may lead to the theft, loss of units or reduction in value (including reduction to zero) of the Client's Digital Assets.
- Risks inherent to consensus mechanisms and concentration risk: DLT may be contingent on independent validators or other forms of consensus formation or validation susceptible to external attacks. Potential attacks include e.g. collision attacks, 51% attacks, dusting attacks and censorship attacks. If successful, such attacks may e.g. enable a perpetrator to take control of Digital Assets, engage in double spending of the same Digital Asset and/or otherwise abuse the identity or personal data of other users. Furthermore, any such attack may adversely affect the functionality, convertibility or transferability or result in a full or partial loss of units or reduction (including reduction to zero) of value of the Client's Digital Assets. The risk of a successful attack is elevated in Digital Assets based on DLT architecture with a high degree of concentration of unit ownership or network functions with a small number of parties.
2. Legal and regulatory risks
Risks of Digital Assets relating to the legal and regulatory environment may include, without limitation:
- Risk of non-compliance or change of legal and regulatory framework: The legal and regulatory framework governing Digital Assets in AIFC is far from settled and continuously evolving. Existing rules and regulations, changes to the legal and regulatory framework and related measures by regulators or other governmental authorities may affect the compliant issuance, domestic and international tradability and transferability or convertibility of the Client's Digital Assets and may potentially result in a full or partial loss of units or reduction of value (including reduction to zero) thereof.
- Risk of supervisory measures in one or more jurisdictions: Digital Assets, their issuers or other involved parties, financial and other service providers may become subject to regulatory investigations, injunctions or other measures which may potentially result in a full or partial loss or reduction of value of the Client's Digital Assets, impact the ability to offer Digital Assets to the Client or otherwise affect the Client. Further, such measures may impede, restrict or prohibit the Client from holding or transacting in Digital Assets.
- Risk of seizure of Digital Assets: The technology underlying Digital Assets enables thorough forensic investigations that may be able to reach back and cover a period of time and number of transactions that would not be possible with similar effort in the context of traditional assets. Depending on the individual case, such forensic investigations could cover a period reaching back to the generation of the relevant Digital Asset. As a result, the Client's Digital Assets may be subject to a risk of seizure by courts or governmental authorities where they have been previously used for or in connection with criminal activities or may otherwise be considered "tainted". Release of seized Digital Assets may be subject to foreign laws or regulations and the relevant procedures may result in costs, delays or other adverse effects to the Client.
3. Market risks
Risks of Digital Assets relating to the relevant markets, trading platforms and systems may include, without limitation:
- Markets in Digital Assets are evolving: The markets in Digital Assets are evolving and may be subject to elevated volatility and limited transparency and reliability, execution delays or failures, all of which may potentially result in losses or other adverse effects for the Client.
- Delays in execution or settlement of transactions in Digital Assets: Execution and settlement of transactions in Digital Assets may be dependent on particularities of the relevant distributed ledger or on the participation of third parties on the relevant network, in particular on the availability of miners or other processing entities. Delays or failures to execute or settle transactions may potentially result in losses or other adverse effects for the Client.
- Valuation risk of Crypto Currencies in particular: Crypto Currencies are not typically linked to any national or supranational currency or to any asset or commodity traded on a regulated market and may be subject to elevated volatility. Market exchange rates of Crypto Currencies assets may change between issuance of an instruction for sale or purchase and execution.
By trading, transacting, investing and holding positions in Digital Assets, the Client acknowledges and accepts the risks described in this Disclaimer. Clients that do not understand this Disclaimer should retain competent counsel or refrain from engaging in activities involving Digital Assets.
Company is not responsible for any loss or damage resulting from the realisation of risks specific to Digital Assets that are outside the sphere of influence of Company. Further, Company is under no obligation to inform the Client of the realisation or possibility of realisation of any of the risks described above or any other risks relating to Digital Assets.