Thank you for choosing token.CoinFLEX.com (the “Site”). The following terms and conditions of service (these “Terms of Service”) apply to users of the Site, and should be read together with the Privacy Policy and Risk Disclosure Statement. By using any of the services, functions, or features offered from time to time on the Site (collectively or individually, the “Services”), the user (referred to herein as “you” or “your”) agrees to these Terms of Service (each of you being a “Party” and collectively, the “Parties”).

These Terms of Service represent the entire agreement and understanding between you and Liquidity Technologies Limited, a Cook Islands company (“CoinFLEX”), with respect to the use of the Services.

The following documents are incorporated into these Terms of Service by reference: the Risk Disclosure Statement; the Privacy Policy; the Anti-Spam Policy; the Law Enforcement Requests Policy; and the Fees Schedule. In the event of any inconsistency between these Terms of Service and any other pages, policies, terms, conditions, licenses, limitations, or obligations contained within or on the Site, these Terms of Service shall prevail.

All transactions of Digital Tokens on or off the Site may be subject to fees levied by CoinFLEX as set out and updated in the Fees Schedule (https://coinflex.com/fees/) from time to time.

By creating a Digital Tokens Wallet on the Site or by using any of the Services, you acknowledge that you have read, understand, and agree to these Terms of Service, as updated and amended from time to time. If you do not agree to be bound by these Terms of Service, including any subsequent amendments from time to time, you may not use any of the Services. By using any of the Services you agree to be bound by the Terms of Service. If you do not wish to be bound by these Terms of Service you must stop using all of the Services.

These Terms of Service may be amended by CoinFLEX at any time and without prior notice to you. You should periodically check the Site to confirm that your copy and understanding of these Terms of Service is current and correct. Your continued use of any Services after the effective date of any amendments will confirm your acceptance of these Terms of Service, as amended from time to time.

The use of the Site and any Services is void where such use is prohibited by, would be a violation of, or would be subject to penalties under applicable law, and shall not be the basis for the assertion or recognition of any interest, right, remedy, power, or privilege.

1. Interpretation:

1.1 Definitions: In these Terms of Service and all documents incorporated herein by reference, the following words have the following meanings unless otherwise indicated:

1.1.1 “Affiliate” means, in relation to either Party, a direct or indirect subsidiary of the Party, a holding company of the Party, and any other subsidiary of that holding company;

1.1.2 “AML” means anti-money laundering, including all laws applicable to the Parties prohibiting money laundering;

1.1.3 “Anti-Corruption” means all laws applicable to each Party prohibiting corruption or bribery of Government Officials, kickbacks, inducements, and other related forms of commercial corruption or bribery; 

1.1.4 “Associates” means CoinFLEX and each and every one of their respective shareholders, directors, officers, Affiliates, employees, contractors, agents, partners, insurers, and attorneys who or that are acting or performing or has acted or performed services for the benefit of or on behalf of the Site;

1.1.5 “CoinFLEX” means Liquidity Technologies Ltd, a Cook Islands International Company;

1.1.6 “CoinFLEX Platform” means the website at https://www.coinflex.com, and the company that owns and operates it, Liquidity Technologies, Ltd., a Seychelles International Business Corporation;

1.1.7 “CoinFLEX Platform Customers” means persons or entities who have an account on the CoinFLEX Platform for trading Perpetual Futures Contracts;

1.1.8 “CoinFLEX Reserves” means USDC and other assets belonging to CoinFLEX and held on the CoinFLEX Platform, and margin-collateral CoinFLEX acquires in Perpetual Futures Contracts on the CoinFLEX Platform;

1.1.9 “CoinFLEX Token” means the Digital Token issued and redeemed by CoinFLEX, including flexUSD token backed by USDC, and other Digital Tokens backed by other Underlying Assets issued by CoinFLEX from time to time;

1.1.10 “Controlling Person” means any Person who owns more than a 25 percent interest in any Person or affiliate; 

1.1.11 “Copyrights” has the meaning set out in paragraph 10 of these Terms of Service;

1.1.12 “CRS” means the common reporting standard or the Standard for Automatic Exchange of Financial Account Information;

1.1.13 “CTF” means counter-terrorist financing; 

1.1.14 “Digital Tokens” means a digital representation of value that functions as (i) a medium of exchange; (ii) a unit of account; (iii) a store of value, and/or (iv) other similar digital representations of rights or assets, which is neither issued nor guaranteed by any country or jurisdiction and does not have legal tender status in any country or jurisdiction, typically including blockchain-based assets or rights including sovereign cryptocurrency or virtual currency such as BTC, BCH, and ETH; 

1.1.15 “Digital Token Address” means an alphanumeric identifier that represents a potential destination for a Digital Token transfer, which typically is associated with a user’s Digital Tokens Wallet; 

1.1.16 “Digital Token Wallet” means a software application (or other mechanism) that provides a means for holding, storing, and transferring Digital Tokens, including a user’s Digital Token Address, Digital Token balance, and cryptographic keys; 

1.1.17 “Economic Sanctions” means financial sanctions, trade embargoes, export or import controls, anti-boycott, and restrictive trade measures enacted, administered, enforced, or penalized by any laws applicable to you or the Site;

1.1.18 “FATF” means the Financial Action Task Force;

1.1.19 “Fiat” means the money or currency of any country or jurisdiction that is designated as legal tender; and, circulated, customarily used, and accepted as a medium of exchange in the country or jurisdiction of issuance;

1.1.20 “Government” means any national, federal, state, municipal, local, or foreign branch of government, including any department, agency, subdivision, bureau, commission, court, tribunal, arbitral body, or other governmental, government appointed, or quasi-governmental authority or component exercising executive, legislative, juridical, regulatory, or administrative powers, authority, or functions of or pertaining to a government instrumentality, including any parasternal company, or state-owned (majority or greater) or controlled business enterprise;

1.1.21 “Government Approval” means any authorization, license, permit, consent, approval, franchise, concession, lease, ruling, certification, exemption, exception, or waiver by or with any Government necessary to conduct the business of either Party or the execution and delivery of the Services under this Terms of Service;

1.1.22 “Government Official” means an officer or employee of any Government, a director, officer, or employee of any instrumentality of any Government, a candidate for public office, a political party or political party official, an officer or employee of a public international organization, and any Person who is acting in an official capacity for any of the foregoing, even if such Person is acting in that capacity temporarily and without compensation;

1.1.23 “Losses” has the meaning set out in paragraph 14 of these Terms of Service;

1.1.24 “margin-collateral” means an asset of sufficient value to repay a loan obligation;

1.1.24 “Marks” has the meaning set out in paragraph 10 of these Terms of Service;

1.1.25 “OFAC” means Office of Foreign Assets Control of the U.S. Department of the Treasury;

1.1.26 “Perpetual Futures Contract” means a futures contract without an expiry date offered on the CoinFLEX Platform;

1.1.27 “Person” includes an individual, association, partnership, corporation, other body corporate, trust, estate, and any form of organization, group, or entity cognizable as legal personalities;

1.1.28 “Personal Information” has the meaning set out in the Privacy Policy;

1.1.30 “Prohibited Jurisdictions” means Cuba; Democratic People’s Republic of Korea (North Korea); Iran; Pakistan; Singapore; Syria; the Government of Venezuela; and Crimea;

1.1.31 “Prohibited Use” has the meaning set out in paragraph 8 of these Terms of Service;

1.1.33 “Sanctions List” means the “Specially Designated Nationals and Blocked Persons” (“SDN”) List and the Non- SDN List, including the “Sectoral Sanctions Identifications List”, published by OFAC; the Section 311 Special Measures for Jurisdictions, Financial Institutions, or International Transactions of Primary Money Laundering Concern published by FinCEN; and, any other foreign terrorist organization or other sanctioned, restricted, or debarred party list published by the FIA, or under Economic Sanctions, AML, or CTF laws of or by Governments of the United States, the Seychelles, Hong Kong SAR, the United Nations, or any other jurisdiction or Government, as applicable to you or to the Site, as amended, supplemented, or substituted from time to time;

1.1.34 “Sanctioned Person” refers to any Person or Digital Token Address that is: (i) specifically listed in any Sanctions List; or (ii) directly or indirectly owned 50 percent or more by any Person or group of Persons in the aggregate, or a Digital Tokens Wallet associated with such Person or Persons, referred to in any Sanctions List, or Government or Government Official of any Prohibited Jurisdiction, and (iii) that is not subject to any Government Approval or otherwise not sanctioned, restricted, or penalized under applicable laws;

1.1.35 “Terms of Service” means these terms and conditions of service, as they may be changed, amended, or updated from time to time, including the following Site policies and pages: the Risk Disclosure Statement; the Privacy Policy; the Anti-Spam Policy; the Law Enforcement Requests Policy; and the Fees Schedule;

1.1.36 “Underlying Asset” means the asset backing a particular type of CoinFLEX Token, such as USDC backing flexUSD.

1.1.37 “U.S. Citizen or U.S. Resident” includes any U.S. citizen, U.S. lawful permanent resident, individual who meets the “substantial presence” test described in section 7701(b)(3) of the U.S. Internal Revenue Code of 1986 (as amended), protected individual under section 1324b(a)(3) of the U.S. Immigration and Nationality Act, or individual who holds a passport issued by the United States Government;

1.1.38 “USDC” means the stablecoin issued by Coinbase backed 1:1 to US dollars, described more fully at https://www.coinbase.com/usdc;

1.1.39 “U.S. Person” means:

1.1.39.1 U.S. Citizen or U.S. Resident;

1.1.39.2 corporation, partnership, or other entity established or organized in or under the laws of the United States;

1.1.39.3 any estate of a decedent who was a citizen or a resident of the United States; or

1.1.39.4 any trust if (i) a court within the United States is able to exercise primary supervision over the administration of the trust, and (ii) one or more United States Persons have the authority to control all substantial decisions of the trust;

1.1.39.5 “you” or “your” means the user.

1.2 Headings: The headings and subheadings in these Terms of Service are for ease of reference only and are not to be taken into account in the construction or interpretation of any provision or provisions to which they refer.

1.3 Extended Meanings: Unless otherwise specified in these Terms of Service, words importing the singular include the plural and vice versa and words importing gender include all genders.

1.4 Governing Law: These Terms of Service shall be governed by and construed and enforced in accordance with the laws of the Cook Islands, and shall be interpreted in all respects as a Cook Islands contract. Any dispute, controversy, claim or action arising from or related to your use of the Site or these Terms of Service likewise shall be governed by the laws of the Cook Islands, exclusive of choice-of-law principles.

2. Licence to Use the Site:

CoinFLEX grants you the limited right to use the Site and the Services in exchange for your agreement to abide by these Terms of Service. The right to use the Site and the Services is a personal, restricted, non-exclusive, non-transferable, non-sublicensable, revocable, limited licence, and it is subject to the limitations and obligations in these Terms of Service. Nothing in these Terms of Service gives you any licence, right, title, or ownership of, in, or to the Site, any of the Services, the Copyrights or the Marks. The Site may suspend or terminate the Services to you, your Digital Token Wallet, or to any of your Digital Token Address at its sole discretion, as required by applicable laws or where CoinFLEX determines that you have violated, breached, or acted inconsistent with any of these Terms of Service.

3. About CoinFLEX Tokens; General Restrictions:

CoinFLEX issues and redeems CoinFLEX Tokens. CoinFLEX Tokens may be kept or spent wherever parties are willing to accept them as payment.

CoinFLEX Tokens are designed to function as stablecoins that pay interest. CoinFLEX Tokens are pegged to the value of an Underlying Asset, which is then loaned out at interest in Perpetual Futures Contracts on the CoinFLEX Platform.

CoinFLEX tokens have risks that other non-interest bearing stablecoins do not have. While CoinFLEX has designed its product to minimize the risk of loss, it is impossible to protect against all risks. It is essential that users understand how CoinFLEX Tokens are structured in order to understand the risks associated with them. Please also see our Risk Disclosure Statement.

What backs the value of CoinFLEX Tokens?

Each CoinFLEX Token is designed to approximate the value of another asset, such as USDC or BTC (the “Underlying Asset”). CoinFLEX Tokens create a peg to the value of the Underlying Asset by allowing the holders of CoinFLEX Tokens to redeem them for the Underlying Asset. CoinFLEX Tokens are backed by the CoinFLEX Reserves, which consist of a combination of the Underlying Asset and margin-collateral that CoinFLEX will use to redeem CoinFLEX Tokens.

CoinFLEX Tokens are different from the Underlying Asset that gives them value. While CoinFLEX Token holders have the right to redeem their tokens for the Underlying Asset, subject to these Terms of Service, the right of redemption is not the same as custodial ownership. As a result, CoinFLEX Tokens may trade at a discount to the Underlying Asset that backs them.

Do CoinFLEX Tokens pay interest, and how is that interest calculated and paid?

CoinFLEX Tokens are designed to pay interest on the Underlying Assets that back them. Understanding how interest is generated is important to assessing the risk of holding CoinFLEX Tokens.

For example, flexUSD is backed by USDC. USDC does not generate interest for USDC token holders. The US dollars backing USDC tokens sit in bank accounts; and those US dollar bank deposits generate interest payable to Coinbase, which Coinbase keeps.

flexUSD Tokens generate interest on USDC by lending out the USDC (held as CoinFLEX Reserves) in Perpetual Futures Contracts on the CoinFLEX Platform’s Perpetual Futures Market. Other CoinFLEX Tokens backed by different Underlying Assets will earn interest in the same way, by loaning out their particular class of Underlying Assets in Perpetual Futures Contracts on the CoinFLEX Platform.

Interest is calculated based on the actual rates of interest paid to CoinFLEX in the Perpetual Futures Contracts in which it transacts. Different CoinFLEX Tokens (backed by different Underlying Assets) may generate different rates of interest and trade in different volumes. Therefore, different types of CoinFLEX Tokens will generate different amounts of interest for CoinFLEX Token holders.

Interest is not shared between different types of CoinFLEX Tokens. For example, interest generated by flexUSD will be paid to the flexUSD token holders, but not the holders of flexBTC. The same is true in reverse; flexBTC will generate interest that will be paid to the flexBTC token holders, but not holders of flexUSD.

Interest is apportioned on a pro rata basis among holders of a type of CoinFLEX Token. Distributions of interest are paid in CoinFLEX Tokens and are distributed via smart contract to the Digital Wallet Address where the CoinFLEX Tokens are held. To receive interest payments you simply need to be in possession of a Digital Wallet holding CoinFLEX Tokens. For instance, if a single Digital Wallet Address holds one percent of all the outstanding flexUSD tokens, that Digital Wallet Address will receive one percent of all interest generated by flexUSD during a given time period (less CoinFLEX’s fees).

CoinFLEX charges a fee equal to ten percent of the total interest generated by FLEX repo lenders. CoinFLEX’s fee is deducted prior to the distribution of any interest to CoinFLEX Token holders.

Distributions of interest will occur at set times to coincide with the closing of certain Perpetual Futures Contract funding windows. Distributions are scheduled to occur daily shortly after 04:00 UTC, 12:00 UTC and 20:00 UTC.

Does CoinFLEX maintain custody and control over the Underlying Assets when they loan it for trading on the CoinFLEX Platform’s Perpetual Futures Market?

CoinFLEX maintains an account at the CoinFLEX Platform, where it deposits the Underlying Assets from time to time to engage in Perpetual Futures Contracts that generate interest income. CoinFLEX may also withdraw or deposit margin-collateral on the CoinFLEX Platform from time to time. At any given time, some or all of the CoinFLEX Reserves may be in the custody of either CoinFLEX or the CoinFLEX Platform. CoinFLEX and the CoinFLEX Platform are Affiliates that are controlled and operated by the same people.

Once CoinFLEX receives sufficient margin-collateral to support a Perpetual Futures Contract, that margin-collateral becomes part of the CoinFLEX Reserves, and the Underlying Asset that has just been loaned out from the repo trade is released from the CoinFLEX Reserves to the borrower. Margin-collateral may be held in the custody of either CoinFLEX or the CoinFLEX Platform.

CoinFLEX Platform Customers that borrow Underlying Assets via repo borrow trades may withdraw the borrowed Underlying Asset from their CoinFLEX Platform account. However, the margin-collateral paid to receive the borrowed underlying asset will have been credited to the account of CoinFLEX. CoinFLEX Reserves are designed to be of sufficient value to cover any redemptions of Underlying Assets.

Could volatility in the CoinFLEX Platform’s Perpetual Futures Contract market result in a loss of the Underlying Assets?

There are additional risks posed to the CoinFLEX Reserves by volatility in the Perpetual Futures Contract market. While the CoinFLEX Platform has reduced these risks, extreme volatility will always pose a risk.

The two methods the CoinFLEX Platform uses to reduce risk of loss to lenders in Perpetual Futures Contracts are the posting of margin-collateral and forced-liquidations.

Posting margin-collateral. Perpetual Futures Contracts require margin-collateral to be posted for a loan. As discussed in Section 1.1.32, Perpetual Futures Contracts on the CoinFLEX Platform consist of (i) a lender making a loan at interest denominated in an Underlying Asset (e.g. USDC for flexUSD), and (ii) a borrower providing a greater value of BTC, ETH (or another asset) as margin-collateral for the loan. The margin-collateral is held in by CoinFLEX (in the custody of its own wallets or through the CoinFLEX Platform) until the transaction is completed. Thus, if the borrower suffers a total loss of the borrowed USDC while trading, the margin-collateral can be liquidated to cover the loan obligations by repurchasing USDC to fulfill the loan obligation.

Forced Liquidations. Where the value of the margin-collateral (the BTC, ETH, etc) falls, the borrower’s trading positions may be liquidated by the CoinFLEX Platform to ensure its value is sufficient to repay the borrower’s loan obligations. The CoinFLEX Platform uses algorithms designed to force-liquidate positions before such positions result in losses to lenders in Perpetual Futures Contracts. The terms covering forced liquidations are solely determined by the CoinFLEX Platform. For more on how the CoinFLEX Platform determines when to execute forced liquidations see here.

Why is there a risk of loss to Underlying Assets loaned in a Perpetual Futures Contract?

Understanding how the CoinFLEX Platform’s Perpetual Futures Market works is important to appreciate the risk of loss. You should make yourself familiar with the nature of Perpetual Futures Market by reading the terms set out on the CoinFLEX Platform, in addition to reading the description below.

There is always a risk of loss in a Perpetual Futures Contract because the margin-collateral (BTC, ETH, etc.) needs to be sold if the borrower does not have a sufficient sum of the Underlying Asset (e.g. USDC for flexUSD) to repay. If there are no buyers, then the margin-collateral cannot be sold and the loan cannot be repaid. When the market experiences extreme volatility, it is possible that the margin-collateral cannot be force-liquidated quickly enough to recoup the value of the outstanding Perpetual Futures Contract obligation.

Some examples may help understand how a Perpetual Futures transaction works and why there is a risk of loss. In the below examples, assume a transaction involving flexUSD with the following:

BTC is trading at $15,000 USD

Customer A borrows $10,000 USDC at 10% APR,

Customer A provides CoinFlex 1 BTC as margin collateral ($15,000 USDC equivalent)

Customer A uses the borrowed $10,000 USDC to buy BTC 0.667 BTC on the CoinFlex Platform

Example 1: Sufficient USDC to Cover Repayment. BTC is now trading at $16,000. Customer A (i) sells 0.667 BTC, (ii) receives $11,000 USDC, (iii) repays CoinFLEX $10,000 USDC, and (iv) CoinFlex returns the 1 BTC held as margin-collateral to Customer A. Customer A now has their 1 BTC they originally possessed ($16,000 USDC equivalent), and has made $1,000 USDC, less any interest payments and trading fees they incurred. CoinFLEX Token holders suffer no loss in this example.

Example 2: Insufficient USDC to Cover Repayment. BTC is now trading at $14,000. Customer A (i) sells 0.667 BTC and receives $9,333.33 USDC and (ii) does not have additional USDC in their account to repay the loan. Customer A is now short $666.67 USDC (plus interest). To recoup the $667.67 USDC (plus interest), CoinFLEX will (iii) sell part of Customer A’s 1 BTC held as collateral and (iv) credit any remaining BTC balance to Customer A’s account. CoinFLEX Token holders suffer no loss in this example.

Example 3: Forced Liquidation with Sufficient Volume. BTC is now $8,000 US dollars. Customer A has no USDC in their account. When the BTC price falls below $10,000, the 1 BTC held by CoinFLEX as margin-collateral against Customer A’s $10,000 USDC loan will be insufficient to cover repayment. To prevent this from occurring, the CoinFLEX Platform will (i) liquidate Customer A’s position (unless Customer A provides additional BTC as collateral) before the BTC price reaches $10,000, and (ii) sell Customer A’s BTC held as margin-collateral to cover repayment of the $10,000 USDC loan. Once Customer A’s BTC is liquidated, (iii) the $10,000 USDC plus interest is returned to CoinFlex and (iv) any remaining BTC balance is credited to Customer A. CoinFLEX Token holders suffer no loss in this example.

Example 4: Forced Liquidation with Insufficient Volume. BTC falls from $15,000 USDC to $3,000 USDC in an hour. The rapid fall in BTC prices meant that there were no buyers in the market, and CoinFLEX’s forced liquidation could not sell BTC above $10,000. Customer A’s BTC were sold for $8,000 USDC, which resulted in a $2,000 USDC shortfall in the CoinFLEX Reserves. CoinFLEX Token holders may suffer a loss in this example.

If a forced liquidation causes losses to the CoinFLEX Reserves is there any insurance fund that covers all or part of the losses?

CoinFLEX reserves 10 million FLEX coins to be used in the event of unsuccessful liquidation to prevent users from losing funds. 

What happens to the CoinFLEX Reserves if the CoinFLEX Platform experiences an insolvency event?

CoinFLEX and the CoinFLEX Platform are Affiliates controlled and operated by the same people, but are separate entities that are managed and accounted for separately. Because they are separate entities, when CoinFLEX Reserves (belonging to CoinFLEX) are loaned in Perpetual Futures Contracts on the CoinFLEX Platform, those CoinFLEX Reserves are in the custody of the CoinFLEX Platform. This makes CoinFLEX a creditor to the CoinFLEX Platform, and the CoinFLEX Platform is a debtor to CoinFLEX.

In the event of an insolvency event on the CoinFLEX Platform, CoinFLEX would be a general unsecured creditor in the same position in pari passu with other CoinFLEX Platform Customers. If the CoinFLEX Platform is liquidated, CoinFLEX would receive a pro rata share of any remaining assets in satisfaction of the debts owed to it. These pro rata payments may not be sufficient to cover the obligations CoinFLEX owes to CoinFLEX Token holders, and may result in a loss.

To whom does CoinFLEX issue CoinFLEX Tokens? From whom will CoinFLEX redeem CoinFLEX Tokens?

In order to cause CoinFLEX Tokens to be issued or redeemed directly by CoinFLEX, you must be a verified customer of the CoinFLEX Platform and authorize the CoinFLEX Platform to share your information with us. No exceptions will be made to this requirement. The right to have CoinFLEX Tokens redeemed or issued is a contractual right personal to you. CoinFLEX reserves the right to delay the redemption or withdrawal of CoinFLEX Tokens if such delay is necessitated by the illiquidity or unavailability or loss of any Reserves held by CoinFLEX to back the CoinFLEX Tokens, and CoinFlex reserves the right to redeem CoinFLEX Tokens by in-kind redemptions of securities and other assets held in the Reserves, as soon as commercially reasonably. CoinFLEX makes no representations or warranties about whether CoinFLEX Tokens that may be traded on the Site may be traded on the Site at any point in the future, if at all.

Who is prohibited from using CoinFLEX?

The following Persons are prohibited from depositing to, or withdrawing from, any Digital Tokens Wallet on the Site:

3.1 Persons domiciled or ordinarily resident in, certain nationals of, or the Governments or Government Officials of Prohibited Jurisdictions;

3.2 any Person that resides, is located, has a place of business, or conducts business in the United States; and

3.3 U.S. Persons, any individual who is a U.S. Person and any entity that is a U.S. Person is prohibited from using the Site or any Services.

4. Risks and Limitation of Liability: Important: This paragraph is in addition to the Risk Disclosure Statement.

Trading markets in Digital Tokens are volatile and shift quickly in terms of price, liquidity, market depth, and trading dynamics. As discussed in Example 4 of Section 3 above, extreme volatility may cause losses to the CoinFLEX Reserves, which can in turn cause losses to CoinFLEX Token holders.

Digital Tokens also are subject to cybersecurity risk, including the risk of a cyberattack or breach.

You are solely responsible and liable: for any and all trading and non-trading activity on the Site and for your Digital Tokens Wallet on the Site; and, for knowing the true status of your CoinFLEX Tokens on the Site, even if presented incorrectly by the Site at any time. You acknowledge and agree: (i) to be fully responsible and liable for your trading and non-trading actions and inactions on the Site and all gains and losses sustained from your use of the Site and any of the Services; (ii) to be fully responsible for safeguarding access to, and any information provided through, the Site and any of the Services, including, but not limited to, Digital Tokens Wallet, Digital Tokens Address, private keys, usernames, passwords, and bank account details; and (iii) that CoinFLEX does not have control of, or liability for, any products or services that are purchased or sold by third parties using the Site and any of the Services.

Digital Tokens in a given Digital Tokens Wallet or other wallet or address are controlled by your private key and Digital Tokens in a Digital Tokens Wallet or other wallet or address may be stolen or lost and otherwise unrecoverable if the private key is compromised or lost.

You further acknowledge and agree that CoinFLEX is not liable for any losses or issues that may arise from third-party transactions, including, but not limited to, legality (including any consequences for illegal transactions that may be triggered under these Terms of Service), quality, delivery, or satisfaction with any products purchased by means of a Digital Token transfer.

In the event that you are not satisfied with any goods or services purchased from, or sold to, a third party using the Services, you must handle those issues directly with the third-party seller or buyer, as applicable.

Digital Tokens may be compatible with third-party software or other technology provided by a third party. CoinFLEX does not guarantee the security or functionality of third- party software or technology and is not liable for losses of Digital Tokens due to the failure or malfunction of third-party software or technology.

5. Withdrawals and Deposits:

In the course of processing and sending any withdrawals, or when processing and receiving deposits, CoinFLEX may be required to share your user information with other contractual third parties, including financial institutions, or as required under applicable laws or demanded upon a lawful request by any Government.

You hereby irrevocably grant full permission and authority for CoinFLEX to share this information with such contractual third parties, or as required under applicable laws or demanded upon a lawful request by any Government, and release CoinFLEX from any liability, error, mistake, or negligence related thereto.

You accept all consequences of sending Digital Tokens, including CoinFlex Tokens, off of the Site. Digital Token transactions are not reversible. Once you send Digital Tokens to an address, whether intentionally or by a fraudulent or accidental transaction, you accept the risk that you may lose access to, and any claim on, those Digital Tokens indefinitely or permanently.

You acknowledge that CoinFLEX may delay or suspend redemption under various circumstances, including but not limited to, in the event that CoinFLEX determines that you have engaged in a Prohibited Use (as defined in paragraph 8); when CoinFLEX is directed to do so by any Government; if your Digital Tokens Wallet or other account or wallet is subject to pending litigation, investigation, or Government proceedings; or when CoinFLEX believes that someone is attempting to gain unauthorized access to your Digital Tokens Wallet or other account or wallet.

Digital Tokens are not legal tender and are not backed by any Government. Digital Tokens are not subject to Federal Deposit Insurance Corporation (“FDIC”) or Securities Investor Protection Corporation protections, or any similar protections.

6. Resolution of Disputes:

Any dispute, claim, controversy or action arising out of or related to (a) the Terms of Service or the existence, breach, termination, enforcement, interpretation or validity thereof, or (b) your account(s), the operations and Services of the Site, or (c) your access to or use of the Services at any time, shall be subject to the exclusive jurisdiction of the courts of the Cook Islands. For the avoidance of doubt, and without limiting the generality of the foregoing, this provision expressly applies to any claim, whether in tort, contract or otherwise, against CoinFLEX. You irrevocably and unconditionally agree and consent to the jurisdiction and venue of the courts of the Cook Islands, and you waive any objections thereto, including under the doctrine of forum non conveniens or other similar doctrines. You and CoinFLEX agree that any Party hereto may bring claims against the others only on an individual basis and not as a plaintiff or class member in any purported class or representative action or proceeding. No adjudicator may consolidate or join more than one Person’s or party’s claims and may not otherwise preside over any form of a consolidated, representative, or class proceeding. Any relief awarded to any single CoinFLEX user cannot and may not affect any other CoinFLEX users.

7. JURY TRIAL WAIVER: TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING OF ANY KIND WHATSOVER ARISING OUT OF OR RELATING TO THESE TERMS OF SERVICE OR ANY BREACH THEREOF, ANY USE OR ATTEMPTED USE OF THE SITE OR THE SERVICE BY YOU, AND/OR ANY OTHER MATTER INVOLVING THE PARTIES.

8. Prohibited Uses: You may not:

8.1 use the Site or any Services in order to disguise the origin or nature of illicit proceeds of, or to further, any breach of applicable laws, or to transact or deal in, any contraband Digital Tokens, Fiat, funds, property, or proceeds;  

8.2 use the Site or any Services if any applicable laws, including but not limited to AML laws, CTF laws, Anti-Corruption laws, Economic Sanctions laws, prohibit, penalize, sanction, or expose the Site to liability for any Services furnished or offered to you or any of your Digital Tokens Wallet(s) or Digital Tokens Address(es) under these Terms of Service; 

8.3 use the Site or any of the Services, or any nancial services of any U.S. Financial Institution, whether or not an Affiliate or Associate of CoinFlex, to facilitate, approve, evade, avoid, violate, attempt to violate, aid or abet the violation of, or circumvent any applicable laws, including but not limited to AML laws, CTF laws, Anti-Corruption laws, and Economic Sanctions laws;

8.4 use the Site or any Services to evade taxes under the laws of the Cook Islands, Hong Kong, the Seychelles, the United States, or any other jurisdiction(s) applicable to you or the Site;

8.5 use the Site or any Services with anything other than Fiat, funds, keys, property, or Digital Tokens that have been legally obtained by you and that belong to you;

8.6 use the Site or any Services to interfere with or subvert the rights or obligations of CoinFLEX or the rights or obligations of any other Site user or any other third party or cause legal liability for CoinFLEX or other Site user;

8.7 take advantage of any technical glitch, malfunction, failure, delay, default, or security breach on the Site;

8.8 use the Site or any Services to engage in conduct that is detrimental to CoinFLEX or to any other Site user or any other third party;

8.9 use the Site or any Services to: (i) engage or attempt to engage in wash trading, spoofing, fictitious trading or price manipulation; (ii) enter orders or quotes in any Digital Token market with the intent to disrupt, or with reckless disregard for the adverse impact on, the orderly conduct of trading or the fair execution of transactions; or (iii) enter orders or quotes in any Digital Token market with the intent of creating the false impression of market depth or market interest;

8.10 falsify any account, Digital Tokens Wallet, or Digital Tokens Address registration, exchange, or administration details provided to CoinFlex, impersonate another Person or misrepresent your affiliation with a Person;

8.11 falsify or materially omit any information or provide misleading or inaccurate information requested by CoinFLEX, including at registration or during the course of administering any Services to you;

8.12 cause injury to, or attempt to harm, CoinFLEX or any third party through your access to the Site or any Services;

8.13 have more than one account and more than one Digital Tokens Wallet on the Site, or use any Digital Tokens Wallet on a one-time, ‘throwaway’ basis; any such additional Digital Tokens Wallets or one time ‘throwaway’ Digital Tokens Wallet may be terminated or suspended at the absolute discretion of CoinFLEX;

8.14 where you are subject to prohibitions or restrictions as set forth in paragraph 3, access the Site or use any Services utilizing any virtual private network, proxy service, or any other third party service, network, or product with the effect of disguising your IP address or location, or access the Site or use any Services using a Digital Tokens Address in or subject to the jurisdiction of any Prohibited Jurisdiction or Government or Government Official thereof; or,

8.15 violate, cause a violation of, or conspire or attempt to violate these Terms of Service or applicable laws.

Any use, whether actual or suspected, as described in this paragraph shall constitute a “Prohibited Use”. If CoinFLEX determines that you have engaged in any Prohibited Use, CoinFLEX may address such Prohibited Use through an appropriate sanction, in its sole and absolute discretion. Such sanction may include, but is not limited to, making a report to any Government, law enforcement, or other authorities, without providing any notice of you about any such report; confiscation of any Fiat, funds, property, proceeds, or Digital Tokens in any Digital Tokens Wallet that you have on the Site; and, suspending or terminating your access to any Services or Fiat, funds, property, or Digital Tokens from any Digital Tokens Address. CoinFLEX may, at its sole and absolute discretion, seize and deliver your property to any applicable Government, law enforcement, or other authorities where circumstances warrant. In addition, should your actions or inaction result in the imposition of economic costs to CoinFLEX, you shall pay an amount to CoinFLEX so as to render CoinFLEX whole, including without limitation, the amount of taxes or penalties that might be imposed on CoinFLEX.

9. Due Diligence Generally, Anti-Money Laundering and Counter-Terrorist Financing:

CoinFLEX is committed to providing safe, compliant, and reputable Services to identify, detect, prevent, and report on money laundering, terrorist financing, and other improper activities under applicable AML laws, CTF laws, Anti-Corruption laws, and Economic Sanctions laws. Accordingly, CoinFLEX insists on a comprehensive and thorough user due diligence process implementation and ongoing analysis and reporting.

By agreeing to these Terms of Service, you shall affirmatively certify whether (i) you are a U.S. Person or your account would be regarded as a U.S. Account or (ii) you are not a U.S. Person and your account would not be regarded as a U.S. Account, and must provide promptly all information requested and necessary to satisfy due diligence requirements and obligations pursuant to applicable laws and the compliance policies or procedures of CoinFLEX.

Additionally, CoinFLEX monitors for and assesses suspicious or sanctionable transactions under applicable AML, Anti-Corruption, and Economic Sanctions laws, as well as undertakes mandatory reporting to regulators where required. These undertakings shall apply even when you suspend or terminate your relationship with CoinFLEX or abandon your application to have a Digital Tokens Wallet with CoinFLEX. Our policies apply to any and all Digital Tokens, Fiat, and other funds or property being exchanged on or through the Site or by any of you, your Affiliates, and of any of CoinFLEX’s Associates.

CoinFLEX reserves the right to refuse registration to, to bar transactions from or to, or to suspend or terminate the administration of Services, Digital Tokens Address, or Digital Tokens Wallet for or with, any user for any reason (or for no reason) at any time, including but not limited to the provisions of paragraphs 8 and 11, subject to any limitations imposed by applicable laws. Without limiting the generality of the foregoing, this includes, but is not limited to, any transfer, transaction, business, or dealing with a: (i) Sanctioned Person, (ii) a Person from or in jurisdictions that does not meet international AML–CTF standards as set out by the FATF as high-risk, non-cooperative, and strategically deficient jurisdictions, including but not limited to the Democratic People’s Republic of Korea (North Korea), Ethiopia, Iran, Iraq, Serbia, Sri Lanka, Syria, Trinidad & Tobago, Tunisia, Vanuatu, or Yemen; (iii) Person that is a Government Official or Politically Exposed Person within the meaning of the FATF’s 40 Recommendations; (iv) Person that presents a risk of any exposure to penalties, sanctions, or other liabilities under AML laws, CTF laws, Anti-Corruption laws, Economic Sanctions laws, or tax laws that may apply; (v) Person that CoinFLEX determines is acting in the United States or Territory or Insular Possession of the United States in violation of, causing any other Person, including any of the Associates, to violate, attempting or conspiring to violate, or evading or circumventing these Terms of Service or applicable laws; and (vi) any Person that fails to meet any user due diligence standards, requests, or requirements of CoinFLEX, or otherwise appears to be of high risk, including but not limited to any of the foregoing factors.

In lieu of refusing registration or ongoing administration of your Digital Tokens Wallet, CoinFLEX may perform enhanced due diligence procedures. At all times, you may be subject to enhanced due diligence procedures in your use of the Site and any Service. If you decline to provide requested due diligence information or otherwise do not reply timely or substantively with the documentation or data requested, the Site has the absolute discretion to suspend or terminate Services to you immediately.

10. Intellectual Property:

10.1 The trademarks, service marks, and trade names, including both word marks and design marks (the “Mark(s)”) are the property of CoinFLEX or other third parties. You agree not to appropriate, copy, display, or use the Marks or other content without express, prior, written permission from CoinFLEX or the third-party owner of the Marks, including without limitation, as a domain name, as social media prole/handle, on a website, in an advertisement, as or in connection with a phone number, as or in connection with an email address, in Internet search results, in meta data or code, or in any other manner;

10.2 Unless otherwise indicated, all materials on the Site are copyrighted by, and owned exclusively by, CoinFLEX or its parent (“Copyrights”). CoinFLEX reserves all rights in its Copyrights. You agree not to appropriate, copy, display, or use the Copyrights or other content without express, prior, written permission from CoinFLEX;

10.3 You may link to the Site’s homepage or other pages, provided you do so in a way that is fair and legal and does not damage CoinFLEX’s reputation or take advantage of it, but you must not establish a link in such a way as to suggest any form of association, approval, or endorsement on CoinFLEX’s part without prior, express, written consent;

10.4 The Site may provide certain social media features that enable you to link, send communications, or display certain content from the Site. You may use these features solely as they are provided by CoinFLEX. You may not establish a link from any website that is not owned by you, cause the Site or portions of it to be displayed on or by any other site (for example, framing, deep linking, or in-line linking), or otherwise take any action with respect to the materials on the Site that is inconsistent with any other provision of these Terms; and

10.5 The Site and Services are owned by CoinFLEX, its licensors, or other providers, and are protected by copyright, trademark, and other intellectual property or proprietary rights laws in various jurisdictions. All rights not expressly granted to you in these Terms are reserved by CoinFLEX. Except as expressly authorized by CoinFLEX or its licensors, you will not (a) license, sublicense, rent, sell, resell, transfer, assign, distribute, or otherwise commercially exploit or make available to any third party the Site or Service in any way; (b) copy, modify, republish, distribute, or make derivative works based upon the Site or Service; (c) “frame” or “mirror” the Site or Service on any other server or wireless or Internet-based device; or (d) reverse engineer or access the Site or its Services in order to (i) build a competitive product or service, (ii) build a product or service using similar ideas, features, functions, or graphics of the Site or Service, or (iii) copy any ideas, features, functions, or graphics of the Site or Service.

11. Your Representations & Warranties: You represent and warrant to CoinFLEX as follows:

11.1 that, if you are an individual user, you are 18 years of age or older and that you have the capacity to contract under applicable laws;

11.2 that, if you are registering to use the Site on behalf of a legal entity, (i) such legal entity is duly organized and validly existing under the applicable laws of the jurisdiction of its organization; and (ii) you are duly authorized by such legal entity to act on its behalf;

11.3 that you understand the risks associated with using the Site, that you are not prohibited or restricted from using the Site by these Terms, and that you are not otherwise prohibited by applicable laws from using the Site;

11.4 that you will not use the Site or any Services in order to conceal or disguise the origin or nature of proceeds of crime or terrorist financing, or blocked property, frozen assets, economic resources, or corruption related to any Person or Government Official under any applicable laws, or to further any breach of applicable AML laws or CTF laws, or to deal in any unlawful Digital Tokens, Fiat, property, funds, or proceeds;

11.5 that you will not use any Services with anything other than Digital Tokens and USDC (and any other thing of value accepted by CoinFlex from time to time) that have been legally obtained by you and that belong to you;

11.6 that, to the extent not penalized by or in conflict with applicable laws, you are currently in compliance with, and must, at your own cost and expense, comply with all laws that relate to or affect the Services conducted under these Terms of Service, including but not limited to AML laws, CTF laws, Anti-Corruption laws, Economic Sanctions laws, or tax laws, including CRS;

11.7 that you consent to any and all tax and information reporting under AML laws, CTF laws, Anti-Corruption laws, Economic Sanctions laws, or tax laws, including CRS, as CoinFLEX may reasonably determine apply from time to time;

11.8 that neither you nor any of your Affiliates shall use any Digital Tokens, Fiat, property, proceeds or funds subject to the Services of the Site directly or indirectly (i) on behalf of or for the benefit of a Sanctioned Person or any Person subject to the jurisdiction of a Prohibited Jurisdiction, except where authorized under any Government Approval or not restricted by applicable laws; (ii) in violation of or as prohibited, restricted, or penalized under applicable Economic Sanctions laws; or (iii) in any way that would violate, be inconsistent with, penalized under, or cause the omission of ling of any report required under applicable AML laws, CTF laws, or Economic Sanctions laws;

11.9 that you have not (i) violated; (ii) been fined, debarred, sanctioned, the subject of Economic Sanctions-related restrictions, or otherwise penalized under; (iii) received any oral or written notice from any Government concerning actual or possible violation by you under; or (iv) received any other report that you are the subject or target of sanctions, restrictions, penalties, or enforcement action or investigation under, any applicable laws, including AML laws, CTF laws, Anti-Corruption laws, or Economic Sanctions laws;

11.10 that neither you nor any of your Affiliates is: (i) itself or owned or controlled by a Sanctioned Person; (ii) involved in any transaction, transfer, or conduct, whether or not by using or receiving the Services from any Digital Tokens Wallet or Digital Tokens Address, that is likely to result in you or your Affiliates becoming a Sanctioned Person; or (iii) residing or domiciled in, or transferring Digital Tokens, Fiat, funds, or property to, from, or through any Digital Tokens Wallet, Digital Tokens Address, or other account in, a Prohibited Jurisdiction or Government or Government Official of a Prohibited Jurisdiction;

11.11 that neither you nor any of your Affiliates has directly or indirectly offered, promised, given, or authorized any payment, or offered, promised, given, or authorized the giving of anything else of value, including any Digital Tokens, to a Government Official or individual employed by another entity in the private sector in violation of any applicable Anti- Corruption laws;

11.12 that you will not falsify any Digital Tokens Wallet registration or administration details provided to CoinFLEX;

11.13 that you will not falsify or materially omit any information or provide misleading or inaccurate information requested by CoinFLEX in the course of, directly or indirectly relating to, or arising from your activities on the Site or use of any Services, including at registration or during administration or other due diligence processes, and that if any information provided to CoinFLEX becomes incorrect, you will promptly provide corrected information to CoinFLEX;

11.14 that any instructions received or undertaken through your login credentials or from your authorized e-mail address on le with CoinFLEX are deemed to be valid, binding, and conclusive, and that CoinFLEX may act upon those instructions without any liability or responsibility attaching to it;

11.15 that you will fairly and promptly report all income associated with your activity on the Site pursuant to applicable laws and pay any and all taxes exigible thereon; and

11.16 that you will accurately and promptly inform CoinFLEX if you know or have reason to know whether any of the foregoing representations or warranties no longer is correct or becomes incorrect.

12. No Representations & Warranties by CoinFLEX:

CoinFLEX makes no representations, warranties, or guarantees to you of any kind. The Site and the Services are offered strictly on an as-is, where-is basis and, without limiting the generality of the foregoing, are offered without any representation as to merchantability or fitness for any particular purpose. CoinFLEX may also provide access to features or services that are identified as “beta” or pre-release. Without limiting the preceding sentences in this paragraph, you understand that such services are still in development, may have bugs or errors, may be feature incomplete, may materially change prior to a full commercial launch, or may never be released commercially.

13. No Advice: CoinFLEX does not provide any investment advice or advice on trading techniques, models, algorithms, or any other schemes.

14. Limitation of Liability & Release:

Except as may be provided for in these Terms of Service, CoinFlex assumes no liability or responsibility for and shall have no liability or responsibility for any claim, application, loss, injury, delay, accident, cost, business interruption costs, or any other expenses (including, without limitation, attorneys’ fees or the costs of any claim or suit), nor for any incidental, direct, indirect, general, special, punitive, exemplary, or consequential damages, loss of goodwill or business, work stoppage, data loss, computer failure or malfunction, or any and all other commercial losses (collectively, referred to herein as “Losses”) directly or indirectly arising out of or related to:

14.1 these Terms of Service;

14.2 the Site, and your use of it;

14.3 the Services, and your use of any of them;

14.4 any inaccurate, misleading, or incomplete statement by CoinFLEX or on the Site regarding your Digital Tokens Wallet, whether caused by CoinFLEX’s negligence or otherwise;

14.5 any failure, delay, malfunction, interruption, or decision (including any decision by CoinFLEX to vary or interfere with your rights) by CoinFLEX in operating the Site or providing any Service;

14.6 any stolen, lost, or unauthorized use of your Digital Tokens Wallet information, any breach of security or data breach related to your Digital Tokens Wallet information, or any criminal or other third party act affecting CoinFLEX or any Associate; or,

14.7 any offer, representation, suggestion, statement, or claim made about CoinFLEX, the Site, or any Service by any Associate;

14.8 any delay in withdrawal or redemption, or loss of value of CoinFLEX Tokens or the Reserves backing such CoinFLEX Tokens resulting from failure or insolvency of any bank, depository, custodian, borrower, or payment processor holding or processing the assets backing CoinFLEX Tokens, or from the theft of such assets, or from freezes, seizures, or other legal process asserted by a Government; or,

14.9 another Person using your Digital Tokens, Digital Tokens Wallet, account or password, with or without your knowledge.

You hereby agree to release the Associates from liability for any and all Losses, and you shall indemnify and save and hold the Associates harmless from and against all Losses. The foregoing limitations of liability shall apply whether the alleged liability or Losses are based on contract, negligence, gross negligence, tort, unjust enrichment, strict liability, violation of law or regulation, actual fraud, wilful default, or any other basis, even if the Associates have been advised of or should have known of the possibility of such losses and damages, and without regard to the success or effectiveness of any other remedies.

15. No Waiver:

Any failure by CoinFLEX to exercise any of its respective rights, powers, or remedies under these Terms of Service, or any delay by CoinFLEX in doing so, does not constitute a waiver of any such right, power, or remedy. The single or partial exercise of any right, power, or remedy by CoinFLEX does not prevent either from exercising any other rights, powers, or remedies.

16. Force Majeure:

CoinFLEX (or any depository or service provider where our deposit accounts are held or Reserves are handled, including USDC) is not responsible for damages caused by delay or failure to perform undertakings under these Terms of Service when the delay or failure is due to strikes or labor disputes; riots; embargoes; floods; pandemics, bank failures; Digital Token market collapse or fluctuations; futures market fluctuations or volatility; power outages or failures; acts of God or the state’s enemies; lawful acts of public authorities; any and all market movements, shifts, or volatility; computer, server, or Internet malfunctions; Internet disruptions, viruses, and mechanical, power, or communications failures; security breaches or cyber attacks; criminal acts; delays or defaults caused by common carriers; acts or omissions of third parties; or, any other delays, defaults, failures or interruptions that cannot reasonably be foreseen or provided against or that are otherwise outside CoinFLEX’s control. In the event of force majeure, CoinFLEX is excused from any and all performance obligations and these Terms of Service shall be fully and conclusively at an end.

17. Assignment:

These Terms of Service, and any of the rights, duties, and obligations contained herein, are not assignable by you without prior written consent of CoinFLEX. These Terms of Service, and any of the rights, duties, and obligations contained herein, are freely assignable by CoinFLEX without notice or your consent. Any attempt by you to assign these Terms of Service without written consent is void.

18. Severability:

If any provision of these Terms of Service or part thereof, as amended from time to time, is determined to be invalid, void, or unenforceable, in whole or in part, by any court of competent jurisdiction, such invalidity, voidness, or unenforceability attaches only to such provision to the extent of its illegality, unenforceability, invalidity, or voidness, as may be, and everything else in these Terms of Service continues in full force and effect.

19. Sharing of Personal Information:

From time to time, CoinFLEX receives information requests from law enforcement agencies around the world. In this context, CoinFLEX might be ordered to share and/or will provide on a voluntary basis, if this appears reasonable and necessary, your Personal Information with/to law enforcement agencies and/or a Government. You hereby consent to the sharing of your Personal Information as further detailed in these Terms of Service, the Privacy Policy and the Law Enforcement Requests Policy.