Before trading any crypto assets it is important to understand the risks. This overview summarizes certain risks associated with CAKE.
No securities regulatory authority has expressed an opinion about CAKE, including an opinion that CAKE itself is not a security and/or derivative.
Token Description & Project Background
PancakeSwap is a decentralized exchange (DEX) on the Binance Smart Chain (BSC) that shares many similarities with popular DEXs like Uniswap and Sushiswap. It enables the trading of BEP-20 tokens, the native tokens of BSC, and also serves as a platform for users to create their own native tokens and swaps with much lower gas fees.
CAKE, the platform’s utility and governance token, allows users to participate in voting for protocol parameters and receive CAKE rewards by providing liquidity through staking. The identity of the CAKE founding team remains undisclosed.
Risks of CAKE
Like an investment in other crypto assets, there are some general risks to investing in CAKE. 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 CAKE is subject to the following specific risks:
- CAKE operates using smart contracts, which have an association with vulnerabilities and security breaches. Despite undergoing audits by well-regarded third-party entities, it is essential to acknowledge the existence of inherent risks. Furthermore, the development team behind CAKE remains anonymous, and the project’s future trajectory hinges on the decisions made by a global community of CAKE token holders
We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with CAKE. 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 CAKE community and the aforementioned founders are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of CAKE have no recourse to the CAKE community or Uphold if CAKE 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 CAKE on the Uphold Platform, Uphold performed due diligence on CAKE and determined that CAKE 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 CAKE, 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 CAKE.
- Any marketing materials put forward by the CAKE social team including on, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
- Material technical risks associated with CAKE, including any code defects, security breaches and other threats concerning CAKE 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 CAKE, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of CAKE.
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 21, 2023.
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