Risk Disclosure

Investing in private companies is risky. An Issuer may fail to execute its business plan, run out of cash or be liquidated, in which case shareholders are usually the last to be repaid and may recover nothing. Investments made through Coin District are not covered by any deposit or investor compensation scheme.

Securities of unlisted companies are not traded on a stock exchange. There is currently no way to sell your Tokens on Coin District: a secondary market is planned, and even once it opens there is no guarantee that a buyer will be available, at the time you want or at the price you expect. Some Offerings also include lock-up periods during which Tokens cannot be sold.

Companies often raise money in several rounds. Each new issue of shares reduces your percentage of ownership, and later investors may obtain preferential rights (liquidation preference, anti-dilution, board seats) that rank ahead of yours.

The price of an Offering is set by the Issuer and is not the result of a market. Private companies publish less information than listed companies, and financial projections are, by nature, uncertain. Read each Issuer’s key information document and prospectus before investing.

Target returns and dividend policies displayed on the Platform are objectives, not promises. Growing companies usually reinvest their profits, and distributions may be reduced or suspended at any time.

Tokenization changes how your securities are recorded, not the underlying risk of the company. It adds technology-specific risks:

• Smart contract risk — a flaw in the code could disrupt transfers or corporate actions, despite audits;
• Key management — if you use an external wallet and lose your private keys, access to your Tokens may be lost;
• Network risk — congestion, outages or changes to the underlying blockchain may delay transactions;
• Regulatory risk — changes in the law may affect how Tokens can be held, traded or taxed.

The secondary market is not open yet. Once it opens, offer prices will be set by individual sellers, may vary widely when few offers are listed and may differ significantly from the Issuer’s last valuation; your own offer may never find a buyer.

Lending and borrowing are not open on the Platform. Their risks will be described here before they open.

Tokenized funds and syndicates are not open on the Platform. Their risks will be described here before they open.

CNDT is the token of the Coin District ecosystem. It does not give any right to the capital or profits of Coin District, has no guaranteed value and may be highly volatile or have no market at all. CNDT is distributed through the airdrop, under the CNDT Airdrop Terms.

Spreading your investments across several companies, sectors and time periods reduces — but does not eliminate — the risk of loss. We recommend that private company investments represent only a limited share of your total savings.

Tax treatment depends on your personal situation and may change. Coin District does not provide tax advice; consult a qualified advisor if needed.