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The information contained in this Crypto Asset Statement was last updated on October 7, 2024

No securities regulatory authority in Canada has expressed an opinion about HNT or any of the other Crypto Contracts or Crypto Assets made available through Newton Crypto Ltd. (Newton) on the Newton Platform, including an opinion that HNT itself is not a security and/or derivative.  Changes to applicable law may adversely affect the use, transfer, exchange, or value of any of your crypto assets, and such changes may be sudden and without notice.

Newton is offering Crypto Contracts in reliance on a prospectus exemption contained in the exemptive relief decision, dated March 8, 2024. 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 Newton Platform Risk Statement.

This overview provides a summary of certain risks associated with HNT and is not an exhaustive description or summary of these risks and, in addition, does not take into account an individual’s particular situation or risk tolerance.  Investors are encouraged to conduct their own research prior to trading any crypto asset.

Newton users should read the Newton Platform Risk Statement for additional discussion of general risks associated with crypto assets made available through the Newton platform. A copy of the Newton Platform Risk Statement acknowledged by you is available in your account in the “Statements & Reports” section.

Token Description & Project Background

Helium (HNT) is a decentralized blockchain-powered network for Internet of Things (IoT) devices. Helium’s purpose is to create a global wireless network that allows IoT devices to connect to the internet wirelessly and send data affordably and securely. The Helium Network leverages a decentralized architecture and a unique incentive model to provide coverage for IoT devices through a network of hotspots.

Some Key Facts/Features about Helium:

• Proof-of-Coverage: Helium uses a novel consensus mechanism called Proof-of-Coverage (PoC), which verifies the location and coverage provided by the hotspots. This ensures that the hotspots are genuinely providing wireless coverage to IoT devices.
• Incentive Model: Helium incentivizes users to deploy hotspots by rewarding them with HNT tokens. Users earn HNT based on the amount of data they transmit and the coverage they provide, creating a robust and self-sustaining network.
• Decentralized Wireless Network: Helium’s network is entirely decentralized, meaning that it is not controlled by any single entity. This decentralization enhances the network’s security and reliability, making it resilient to single points of failure.
• Low Power, Wide Area Network (LoRaWAN): Helium’s network is built on the LoRaWAN protocol, which is designed for low-power, long-range communication. This makes it ideal for IoT applications where devices need to transmit small amounts of data over long distances.

Risks of HNT

Like an investment in other crypto assets, an investment in HNT includes the following general risks:  (i) volatility risk and liquidity risk, (ii) short history risk, (iii) demand risk, (iv) forking risk, (v) code defects, (vi) regulatory risk, (vii) electronic trading risk, and (viii) cyber security risk.

For additional information of general risks associated with crypto assets, you may refer to the Newton Platform Risk Statement.  In terms of specific risks, as HNT is one of the longest-standing crypto assets and its community base is widely decentralized, there is no central working group or authority to disclose material information to the public regarding HNT.

Please note that these risks and the associated summaries or overviews provided for each herein are not intended to be an exhaustive discussion pertaining to all such risks and, in addition, there may be other risks that come with exposure to HNT. We encourage all Newton users to perform their own due diligence to assess the risks associated with HNT and to determine whether this level of risk is acceptable to them.  Neither the Helium team/founders nor Newton guarantees the value of HNT, and holders of HNT will not have any recourse to HNT or Newton if the value of HNT declines for any reason whatsoever.

Newton’s Evaluation Process

Newton has reviewed and assessed HNT prior to making it available on the Newton Platform and has concluded that HNT 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, Newton will be required to halt, suspend, and then remove HNT from its platform as described in the Newton Platform Risk Statement.

Further, as indicated above, no Canadian securities regulatory authority has expressed an opinion about HNT, including an opinion that HNT is not itself a security and/or derivative.

Based on publicly available information Newton has reviewed HNT, including, but not limited to, a review of the following:

• The creation, governance, usage, and design of HNT, including the source code, security, and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that created HNT.
• The supply, demand, maturity, utility, and liquidity of HNT.
• Material technical risks associated with HNT, including any code defects, security breaches and other threats concerning HNT 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 HNT, including (i) any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of HNT, 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 HNT about whether HNT, or generally about whether the type of crypto asset, is a security and/or derivative.