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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 Mask Network 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 Mask Network 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 Mask Network 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

Mask Network is a protocol that allows its users to send encrypted messages over social media websites, such as Twitter and Facebook.  It acts as a bridge between web2 and web3 applications, and is a decentralized portal that also allows users to use DApps like crypto payments, DeFi, decentralized storage, e-commerce (digital goods/NFTs) and decentralized organizations (DAO) over the top of existing social networks.  By letting users send encrypted messages to friends, send and receive cryptocurrency and share files, and interact with DApps, all on a decentralized level.  Users could enjoy secure, decentralized social messaging, payment networks, file storage, and file sharing without leaving the mainstream social media networks.  Mask Network was founded by Yuji San, who previously founded Dimension.im.

Mask Network’s token, MASK, is used as a governance token for the Mask Network’s roadmap, where users can have a say in MASK’s future developments.

* Currently, Newton does not provide its users with the ability to participate in the governance functions of MASK.

Risks of Mask Network

Like an investment in other crypto assets, an investment in Mask Network 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 Mask Network 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 Mask Network.

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 Mask Network.  We encourage all Newton users to perform their own due diligence to assess the risks associated with Mask Network and to determine whether this level of risk is acceptable to them.  Neither Mask Network nor Newton guarantees the value of Mask Network, and holders of Mask Network will not have any recourse to Mask Network or Newton if the value of Mask Network declines for any reason whatsoever.

Newton’s Evaluation Process

Newton has reviewed and assessed Mask Network prior to making it available on the Newton Platform and has concluded that Mask Network 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 Mask Network 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 Mask Network, including an opinion that Mask Network is not itself a security and/or derivative.

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

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

A link to the Mask Network White Paper is available at the following link.