Nash General Risk Disclosure

Nash General Risk Disclosure

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Introduction

Nash (including its MiCA-regulated entities) is committed to transparency and investor protection. While we operate robust compliance, security, and risk-management frameworks, engaging with crypto-assets involves risks that cannot be fully eliminated. This disclosure summarizes material risks associated with assets and services accessible via Nash. It is not exhaustive and does not replace your own due diligence or professional advice (tax, legal, investment).
Important: The quality and completeness of asset disclosures can materially affect outcomes. Where projects lack a MiCA-compliant whitepaper or substitute it with other materials, risks increase.

 

1. Market and Financial Risks

1.1 Market Volatility

Crypto-assets can experience rapid, unpredictable price swings due to speculation, liquidity shocks, macro events, protocol incidents, or regulatory news. Sudden market moves can result in total loss of invested capital. If the asset’s documentation lacks MiCA-level risk factors, investors may underestimate volatility drivers.

1.2 Liquidity Risk

Shallow order books and low volumes can cause large price impact, partial fills, or inability to exit positions. Tokens with thin markets and limited disclosure often carry higher liquidity uncertainty.

1.3 Foreign Exchange (FX) and Currency Risk

If your base currency (e.g., EUR) differs from the asset denomination (e.g., USD), conversions can turn nominal gains into losses. This risk is frequently under-described in non-standard materials.

1.4 Concentration Risk

Overexposure to a single asset, sector, or protocol magnifies drawdown risk. Undisclosed insider unlocks, vesting terms, or treasury sales can intensify concentration effects when not fully documented.

1.5 De-Pegging Risk (Stablecoins)

Stablecoins can lose their peg due to reserve issues, algorithmic failure, market stress, or regulatory actions, causing permanent value impairment. Disclosures that omit reserve mechanics or attestation cadence heighten this risk.

1.6 Slippage & Execution Risk (DEX)

During volatility or on illiquid venues, fills can deviate significantly from quoted prices. Information asymmetry about liquidity sources or MEV exposure may worsen execution outcomes.

1.7 Interest Rate & Yield Risk

Rewards from staking, lending, or “earn” products are variable and not guaranteed. Methodologies and inputs (e.g., validator performance, borrower mix) should be clearly disclosed; where they aren’t, tail-risk is higher.

1.8 Inflation & Monetary Design Risk

Tokens with uncapped or flexible supply can dilute holders. If issuance schedules or governance levers aren’t transparent or MiCA-compliant, dilution risk rises.

1.9 Listing/Delisting & Information Risk

Assets may be listed or removed due to market, legal, or disclosure considerations. Where whitepapers are non-MiCA or replaced by informal/technical sites, the probability of future restrictions or delistings may be higher.

2. Technology and Operational Risks

2.1 Smart Contract Vulnerabilities

Even audited contracts can contain exploitable bugs. If security assumptions, audits, or admin key controls are not fully disclosed or independently verifiable, risk increases.

2.2 Blockchain Network Risks

Forks, 51% attacks, censorship, congestion, or validator failures can disrupt settlement, cause reorgs, or delay withdrawals.

2.3 Custody & Key Management

Self-custody users are fully responsible for private keys; loss/theft is irreversible. If a project’s docs understate operational key risks (e.g., multisig thresholds, upgrade keys), users may misjudge exposure.

2.4 Cybersecurity Threats

Phishing, SIM-swap, malware, exchange or wallet compromises can lead to asset loss. Informal or promotional sites may lack robust security disclosures, raising user exposure.

2.5 Software Weakness & Upgrades

Protocol upgrades (hard/soft forks) and client diversity issues may introduce incompatibilities or unexpected behavior. Where upgrade governance and roll-back plans are opaque, users face greater uncertainty.

2.6 Third-Party Dependencies

Custodians, validators, or cloud providers may suffer outages or insolvency. If counterparties and dependency maps aren’t clearly documented, risk is harder to assess.

2.7 Data & Privacy Risk

Public ledgers expose transaction histories; linking identities can increase targeted-attack risk. Non-standard disclosures often omit privacy architecture or threat models.

3. Counterparty and Ecosystem Risks

3.1 Rug Pulls & Fraudulent Schemes

Developers can withdraw liquidity or abandon projects, leaving tokens worthless. Marketing-only materials may mask red flags.

3.2 Pump-and-Dump Manipulation

Low-float or thinly traded tokens are susceptible to manipulation. Opaque token distribution and unlocks elevate this risk.

3.3 Insider & Concentration Risks

Large insider holdings or uneven distribution can trigger sharp declines upon unlocks or sales. Where cap tables/vesting aren’t MiCA-standard, information asymmetry increases.

3.4 Counterparty Risk in Lending & Custody

Borrowers or custodians may default or become insolvent. If credit frameworks and collateral practices are insufficiently disclosed, recovery prospects worsen.

3.5 Systemic Risk

Failures at key market nodes (exchanges, stablecoin issuers, custodians, major protocols) can cascade across assets. Sparse or non-compliant disclosures can impair early warning signals.

4. Regulatory and Legal Risks

4.1 Evolving Regulation

Rules governing crypto-assets are developing. Services or tokens may be restricted, require new approvals, or become unavailable.

4.2 Jurisdictional Differences

What’s permitted in one jurisdiction may be restricted in another; users are responsible for local compliance.

4.3 Risks of Non-MiCA Compliant Whitepapers and Alternative Disclosures

Under MiCA, issuers must publish whitepapers meeting strict standards on governance, token economics, rights/obligations, and risks. Many projects (especially extra-EU or pre-MiCA) use materials that do not meet these standards, or substitute them with other sources:

Incomplete or Misleading Information

  • Omission of issuance/vesting, treasury policies, governance powers, dependencies, or admin key controls.

  • Vague or downplayed risk factors; promotional tone over balanced disclosure.

  • Outdated or inconsistent claims across channels.

Substitution with Non-Standard Materials

  • Marketing sites/brochures: emphasis on growth, limited risk detail.

  • Technical docs or GitHub repos: developer-centric; often silent on legal, financial, or governance risks.

  • Community/Discord/Twitter/Reddit: unaudited, hype-prone, easy to manipulate.

  • Litepapers/FAQs: selective highlights without full legal or financial context.

Legal and Regulatory Uncertainty

  • Investor rights and recourse may be unclear.

  • Non-compliant assets face elevated risk of future restrictions, delistings, or bans as MiCA enforcement matures.

Heightened Due Diligence

  • Independently verify claims; look for formal governance docs, audit reports, token distribution, unlock schedules, conflict-of-interest statements, and treasury policies.

  • Treat the absence of MiCA-grade disclosure as a risk signal.

Asymmetric Information

  • Insiders or sophisticated parties may possess superior information; retail users relying on non-standard materials face systematically higher decision risk.

Bottom line: Substituting or lacking a MiCA-compliant whitepaper materially increases risks related to misunderstanding, misinformation, and enforceability. Exercise enhanced caution and assume higher uncertainty.

4.4 Legal Uncertainty in Smart Contracts

In some jurisdictions, smart contracts may not confer clear, enforceable rights; remedies can be limited (see §4.3 on information sufficiency).

4.5 Taxation

Transactions may trigger taxable events (income, capital gains, VAT). Evolving rules and limited disclosures can complicate tax analysis.

5. Service-Specific Risks

5.1 Decentralized Exchanges (DEX)

  • No regulatory oversight; limited surveillance and investor protections.

  • Smart contract reliance; exploits may irreversibly drain funds.

  • MEV/front-running, slippage, failed transactions (network fees lost).

  • Token quality variance: listings often lack MiCA-compliant documentation; treat all sources with caution.

  • No redress mechanisms typical of regulated venues.

5.2 Staking

  • Protocol/validator risks (slashing, misconfiguration, governance attacks).

  • Lock-ups & illiquidity; unbonding delays.

  • Reward variability; may not offset price declines.

  • Disclosure gaps (e.g., validator selection, commission policies) can impair risk assessment.

5.3 Lending & “Earn”

  • Borrower default/rehypothecation; collateral shortfalls during stress.

  • Residual exposure to intermediaries; insolvency risk.

  • Rate volatility; methodology opacity raises uncertainty.

5.4 Custody

  • Third-party dependency; hacks, outages, or operational errors.

  • Cold storage delays for withdrawals.

  • No deposit guarantee schemes; coverage limits do not apply as in traditional banking.

Users should review custodian disclosures; where non-standard, factor higher risk.

6. Additional Risks

6.1 Environmental

Energy-intensive consensus (e.g., PoW) may face restrictions or societal pushback, affecting availability/pricing. Projects with sparse environmental disclosures add uncertainty.

6.2 Reputational

Negative publicity, investigations, or leadership issues can erode trust. Limited or selective communications can exacerbate sudden value shifts.

6.3 Interoperability & Bridging

Cross-chain bridges and wrapped assets depend on complex trust/validator models. If bridge security and governance aren’t rigorously documented, catastrophic loss risk rises.

6.4 Forks & Airdrops

Forked assets may be unsupported or illiquid. If support policies aren’t disclosed in MiCA-grade docs, assets may become stranded.

6.5 Personal Responsibility

Crypto transactions are typically irreversible. Mis-sent funds, weak credentials, or lack of 2FA can permanently compromise assets. Non-standard materials often underemphasize user-opsec.

7. No Advice & User Responsibility

Nash does not provide financial, investment, legal, tax, or accounting advice. Asset availability is not a recommendation. You are solely responsible for determining suitability in light of your objectives, financial situation, and risk tolerance. Where disclosures are non-MiCA or substituted, apply enhanced scrutiny.

Conclusion

Crypto-asset participation entails substantial risk, including loss of all invested capital. Risk levels increase when asset information is non-MiCA compliant or substituted by informal or technical sources. Conduct independent due diligence and consult qualified advisors before engaging.

Compliance and Registration

Nash was the first Crypto Platform in Europe registered by the Financial Market Authority (FMA) of Liechtenstein.
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Industry Leading Security

Nash’s Crypto Platform and Investment App uses state-of-the art, audited security measures and is fully non-custodial.
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Rates may vary over time. Crypto-powered earnings on Nash are not covered by any deposit guarantee schemes like bank savings accounts and involve risks unique to the underlying technologies: (i) Exploitations of the smart contracts used; (ii) Forex fluctations between your national currency and the US dollar, which underlies crypto earnings assets; (iii) USD stablecoins losing their peg. 
Nash is a trademark of Neon Exchange Aktiengesellschaft. Neon Exchange Aktiengesellschaft is an exchange bureau registered with the FMA of Liechtenstein (TT Exchange Service Provider Nr. 261096 as defined by the Token- und VT-Dienstleister-Gesetz / TVTG, 3 October 2019)

Neon Exchange Aktiengesellschaft is a partner of Modulr Finance B.V., a company registered in the Netherlands with company number 81852401, which is authorised and regulated by the Dutch Central Bank (DNB) as an Electronic Money Institution (Firm Reference Number: R182870) for the issuance of electronic money and payment services. Your account and related payment services are provided by Modulr Finance B.V. Your funds will be held in one or more segregated accounts and safeguarded in line with the Financial Supervision Act – for more information, please see this link

Your card is issued by Modulr Finance B.V. pursuant to a license by Visa Europe. Visa and the Visa brand mark are registered trademarks of Visa Europe.
Neon Exchange Aktiengesellschaft also provides fiat-crypto exchange services. These are separate and unrelated to the account and payment services you receive from Modulr Finance B.V.

Neon Exchange Aktiengesellschaft is the issuer of the NEX Token.

Nash Exchange B.V. has currently not obtained a MiCA-license in the EU. Nash Exchange B.V. is actively engaging with the supervisory authority in The Netherlands (the AFM) to ensure compliance with MiCA and other applicable legislation.