Token Description & Project Background

NEM stands for ‘New Economy Movement’.

The Founders call the project a ‘Smart Asset Blockchain’. It is designed to manage assets, data and minimize transaction times and network congestion.

NEM uses a distinct algorithm – Proof of Importance - and delegated harvesting to reward verification. When a block is harvested, it is permanently added and the harvester is rewarded from transaction fees.

Harvesting claims to be an energy-efficient alternative to mining. There is no incentive for rewarding miners for unrestricted use of power - running the system is supposedly affordable and this drives down the cost of transactions.

NEM also supports the Nano wallet.

The project was originally a fork of the cryptocurrency NXT but then evolved to become NEM (XEM) in 2015. 

XEM is the currency used on its blockchain.

NEM is run by the NEM.io foundation in Singapore, a non-profit organization. The foundation launched in 2017.

Risks of XEM

Like an investment in other crypto assets, there are some general risks to investing in XEM. 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 the Risks Specific to Holding Digital Assets statement.

In addition to these general risks, an investment in XEM is subject to the following specific risks:

• The Layer-1 and smart-contract platform spaces face intense competition. A number of projects which also aim to provide the cheapest and most efficient infrastructure for projects have emerged since NEM’s inception in 2015. Any potential success associated with XEM is dependent on NEM’s rate of adoption.
• The NEM Foundation has previously run into financial difficulties. See this 2019 NEM Foundation update here.

We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with NEM. 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 NEM community and NEM Foundation are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of NEM have no recourse to the NEM community, NEM Foundation, or Uphold if NEM 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 NEM on the Uphold Platform, Uphold performed due diligence on NEM and determined that NEM 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 NEM, including ensuring the source code is open-source, audited and peer reviewed, security, and roadmap for growth in the developer community. 
• The supply, demand, maturity, utility, and liquidity of NEM.
• Any marketing materials put forward by the NEM social team including on, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
• Material technical risks associated with NEM, including any code defects, security breaches and other threats concerning NEM 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 NEM, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of NEM. 

General

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 the Risks Specific To Holding Digital Assets statement 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 link. Please also review the Uphold Canada – Crypto Risk Statement 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 Risks Specific To Holding Digital Assets statement. 

Last updated on June 16, 2023.