Token Description & Project Background

Qtum is a smart contract platform that combines characteristics of both the Ethereum and Bitcoin blockchain. It uses Bitcoin core as the base of its network for security and stability while integrating Ethereum’s virtual machine (EVM) to enable the support of smart contracts and decentralized applications. Qtum uses Proof-of-Stake consensus mechanism to validate transaction blocks and provide security assurances. 

QTUM is used as a ‘gas token’ to cover gas fees when transacting within the network, governance, and staking. When QTUM is staked holders may receive block rewards in return for securing the network. The token launched in March 2017 via ICO.

Qtum’s governance system, Decentralized Governance Protocol, carries out changes to network parameters which may include block size and the base cost of gas fees. QTUM holders are empowered to approve such modifications by staking their tokens to approve or disapprove proposed changes. 

The project was co-founded by Patrick Dai, Jordan Earls and Neil Mahl.

Risks of QTUM

Like an investment in other crypto assets, there are some general risks to investing in QTUM. 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 QTUM is subject to the following specific risks:

• A number of smart contract platforms designed to cater to enterprise clients have entered the space in recent years - as such there is significant competition. Any potential success associated with QTUM will depend on its rate of adoption by enterprises, projects, and developers.

We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with QTUM . 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 QTUM community and core team are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of QTUM have no recourse to the QTUM community, core team, or Uphold if QTUM 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 QTUM on the Uphold Platform, Uphold performed due diligence on QTUM and determined that QTUM 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 QTUM, 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 QTUM.
• Marketing materials put forward by the QTUM social team including, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
• Material technical risks associated with QTUM, including any code defects, security breaches and other threats concerning QTUM 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 QTUM, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of QTUM. 

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 5, 2023.