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 Dash 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 Dash 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 Dash 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
DASH is a cryptocurrency designed specifically for payments and is a fork of Litecoin, which is itself a fork of the Dash protocol. DASH was created by Evan Duffield in 2014 and was originally known as “Xcoin,” later rebranded as “darkcoin,” and finally “DASH.” DASH is a decentralized autonomous organization (DAO) and, as such, its users determine the governance and operation of the network.
DASH has a two-tier network structure and uses the X11 algorithm for mining purposes. The first tier is powered by miners and utilizes a Proof-of-Work (PoW) consensus mechanism who compete to create new blocks and secure the blockchain. The second tier uses a Proof-of-Service (PoSe) consensus mechanism and is powered by “Masternodes” which are users on the network who assume some of the functions of a miner such as ordering and verifying transactions in exchange for earning rewards.
* Currently, Newton does not provide its users with the ability to participate in the governance functions of DASH.
Risks of Dash
Like an investment in other crypto assets, an investment in Dash 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 Dash 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 Dash.
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 Dash. We encourage all Newton users to perform their own due diligence to assess the risks associated with Dash and to determine whether this level of risk is acceptable to them. Neither Dash nor Newton guarantees the value of Dash, and holders of Dash will not have any recourse to Dash or Newton if the value of Dash declines for any reason whatsoever.
Newton’s Evaluation Process
Newton has reviewed and assessed Dash prior to making it available on the Newton Platform and has concluded that Dash 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 Dash 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 Dash, including an opinion that Dash is not itself a security and/or derivative.
Based on publicly available information Newton has reviewed Dash, including, but not limited to, a review of the following:
- The creation, governance, usage, and design of Dash, including the source code, security, and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that created Dash.
- The supply, demand, maturity, utility, and liquidity of Dash.
- Material technical risks associated with Dash, including any code defects, security breaches and other threats concerning Dash 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 Dash, including (i) any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of Dash, 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 Dash about whether Dash, or generally about whether the type of crypto asset, is a security and/or derivative.
A link to the Dash White Paper is available at the following link.