The information contained in this Crypto Asset Statement was last updated on August 15, 2022.
No securities regulatory authority in Canada has expressed an opinion about Band Protocol 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 Band Protocol 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 Re Newton Crypto Ltd. dated August 15, 2022. 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 Band Protocol 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
Band Protocol is a cross-chain decentralized oracle platform that facilitates the use of real world data in blockchain applications. By supplying blockchain applications with actionable data, such as price feeds, weather data, and various math functions, Band allows developers to create more robust DeFi applications. In 2020, Band transitioned from the Ethereum protocol, to the Cosmos network, as they intend to use Cosmos’ Inter Blockchain Communication (IBC) protocol to better provide oracle services. Band was founded by Soravis Srinawakoon, Paul Chonpimai and Sorawit Suriyakarn. Prior to Band Protocol, Srinawakoon worked as a software engineer at Ericsson, Chonpimai was an engineer at Tripadvisor, and Suriyakarn was a software engineer at Quora and Dropbox.
Band Protocol’s token, BAND, is used to secure the protocol, and can be staked on the mainnet which uses a Byzantine fault Tolerance (BFT) consensus algorithm to protect it against any attacks.*
* Currently, Newton does not provide its users with the ability to participate in the staking functions of BAND.
Risks of Band Protocol
Like an investment in other crypto assets, an investment in Band Protocol 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 Band Protocol 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 Band Protocol.
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 Band Protocol. We encourage all Newton users to perform their own due diligence to assess the risks associated with Band Protocol and to determine whether this level of risk is acceptable to them. Neither Band Protocol nor Newton guarantees the value of Band Protocol, and holders of Band Protocol will not have any recourse to Band Protocol or Newton if the value of Band Protocol declines for any reason whatsoever.
Newton’s Evaluation Process
Newton has reviewed and assessed Band Protocol prior to making it available on the Newton Platform and has concluded that Band Protocol 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 Band Protocol 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 Band Protocol, including an opinion that Band Protocol is not itself a security and/or derivative.
Based on publicly available information Newton has reviewed Band Protocol, including, but not limited to, a review of the following:
- The creation, governance, usage, and design of Band Protocol, including the source code, security, and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that created Band Protocol.
- The supply, demand, maturity, utility, and liquidity of Band Protocol.
- Material technical risks associated with Band Protocol, including any code defects, security breaches and other threats concerning Band Protocol 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 Band Protocol, including (i) any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of Band Protocol, 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 Band Protocol about whether Band Protocol, or generally about whether the type of crypto asset, is a security and/or derivative.
A link to the Band Protocol White Paper is available at the following link.