Before trading any crypto assets it is important to understand the risks. This overview summarizes certain risks associated with KSM.
No securities regulatory authority has expressed an opinion about KSM, including an opinion that KSM itself is not a security and/or derivative.
Token Description & Project Background
Kusama is an experimental testnet for Polkadot that lives as an independent network.
It is powered by a native token, KSM, which secures the network and provides governance participation.
Kusama will live on post Polkadot mainnet as a grounds for emerging network features.
Gavin Wood is the creator of Kusama and the network has been live since early 2019.
Web3 Foundation (the entity that controls Polkadot) owns 30% of the outstanding tokens.
Risks of KSM
Like an investment in other crypto assets, there are some general risks to investing in KSM. These include: (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 these and other general risks associated with crypto assets and Uphold’s platform, please refer to thestatement.
In addition to these general risks, an investment in KSM is subject to the following specific risks:
- The Layer-1 space faces intense competition. As a Polkadot parachain, any potential success associated with KSM is heavily reliant on the adoption rate of the Polkadot blockchain by projects and developers.
We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with KSM. Investors should conduct their own research and perform their own assessment before trading any crypto asset to determine the appropriate level of risk for their personal circumstances.
The KSM community and Web3 Foundation are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of KSM have no recourse to the KSM community, Web3 Foundation, or Uphold if KSM declines in value for any reason.
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.
Uphold’s Evaluation Process
Prior to listing KSM on the Uphold Platform, Uphold performed due diligence on KSM and determined that KSM is unlikely to be a security or derivative under relevant securities legislation. Uphold’s analysis including reviewing publicly available information on the following:
- The creation, governance, usage, and design of KSM, including ensuring the source code being open-source, audited and peer reviewed, security, and roadmap for growth in the developer community.
- The supply, demand, maturity, utility, and liquidity of KSM.
- Marketing materials put forward by the KSM social team including, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
- Material technical risks associated with KSM, including any code defects, security breaches and other threats concerning KSM 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 KSM, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of KSM.
Uphold has prepared this Crypto Asset Statement based on publicly available information. Although Uphold has taken steps to obtain information from apparently reliable sources, information contained in this Crypto Asset Statement may be inaccurate, incomplete or out-of-date. This overview is a starting point for you to perform your own research prior to investing in a crypto asset.
Uphold users should read thestatement for additional discussion of general risks associated with crypto assets made available through the Uphold platform.
Canadian residents, please note that Uphold has filed an application for registration in certain Canadian jurisdictions but has not yet obtained registration. Until such time as Uphold obtains registration, Uphold has agreed to abide by the terms of an undertaking available at the following. Please also review the for additional discussion of general risks associated with the crypto assets made available through Uphold Platform. Please be aware that statutory rights of action for damages or rescission in section 130.1 of the Securities Act (Ontario) and, if applicable, similar statutory rights under securities legislation in the other provinces and territories of Canada do not apply in respect of this Crypto Asset Statement or other disclosures on the Uphold website and statement.
Last updated on June 5, 2023.
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