Risk Disclosure Statement

The regulatory environment concerning VAs continues to develop. Legislative and regulatory changes or actions at the state, federal, or international level may adversely affect the use, transfer, exchange, and value of VAs or the Services. In addition, the VA markets and exchanges are not regulated with the same controls or customer protections available in other traditional forms of investment such as equity, option, futures, or foreign exchange investments.

You understand that ultimately it is your responsibility to make sure that you comply with any and all local regulations, directives, restrictions and laws in your place(s) of residence before using our Services. We do not permit the use of our Services by Users from a jurisdiction in which the use of our Services is not permitted (Restricted Jurisdictions). We are not offering or soliciting the use of our Services to any person located in any Restricted Jurisdiction or any other jurisdiction in which the specific use of our Services is prohibited by applicable laws.

Transactions relating to VA's may not be private and may be recorded on public Distributed Ledger Technology. There can be no assurance that use of the Services will provide a positive return or profit, that significant losses will not be incurred, or that your objectives will be achieved. It is possible that you may lose a substantial proportion or all of your capital.

We strongly request and recommend our clients to conduct extensive research into the legitimacy of each individual VA before investing. The features, functions, characteristics, operation, use and other properties of the specific VA may be complex, technical, or difficult to understand or evaluate. The VA may be vulnerable to attacks on the security, integrity or operation. Some VA transactions will be deemed to be made when recorded on a public ledger, which is not necessarily the date or time that a transaction may have been initiated.

Any client money account maintained by Varni Labs FZE may not be sufficient to cover all losses incurred by You. Any insurance maintained by Varni Labs FZE for the benefit of its clients may not be sufficient to cover all losses incurred by clients. The nature of VA means that any technological difficulties experienced by Varni Labs FZE may prevent the access of your VA.

Varni Labs FZE engages third party service providers for the creation of accounts to enable custody of virtual assets as well as Fiat. These third parties are service providers and not our affiliates or under our control and name of such third parties are Fireblocks & Zand Bank.

VA's may not always be transferable or transactions in VAs may be irreversible, and, accordingly, losses due to theft, fraudulent or accidental transactions may not be recoverable. The nature of digital currency may lead to an increased risk of fraud or cyber-attack. Any individual VA may change or otherwise cease to operate as expected due to changes made to its underlying technology, changes made using its underlying technology, or changes resulting from an attack. Malicious individuals, groups or organisations may attempt to interfere with the Platform in a variety of ways, including, but not limited to, malware attacks, denial of service attacks, coordinated attacks, account takeovers and submitting fake transactions (including spoofing) which could negatively affect the Services.

You can take the following measures to protect your keys and/or seed phrases from misuse or unauthorized access:

• Enable Two-Factor Authentication (2FA): This adds an extra layer of security by requiring a second verification step, such as a unique code sent to their mobile device.
• Secure Storage of Keys and Seed Phrases: Clients should use offline or hardware wallets designed specifically for storing virtual assets. Additionally, keys should be saved offline and never revealed in plaintext to anyone, ideally keys should be stored in lockers.
• Backup and Recovery: Keys and seed phrases should be regularly backed up. Clients should store backups in multiple secure locations, preferably encrypted and offline, to protect against physical loss or damage.
• Monitor Account Activity: Encourage clients to monitor their account activity regularly and report any suspicious transactions or unauthorized access to the VASP immediately.

There are no deposit protection schemes that are applicable to the Services and your Account balances are uninsured unless you specifically obtain third party private insurance with respect to them. Your Account balance is at risk of total loss, from, among others things, security breaches (whether in respect of your Account(s) specifically or the Services generally), electronic, technological or systems failures (including book- or record keeping errors), and insolvency or bankruptcy, or equivalent formal proceedings, in respect of the Company. It is your responsibility to ensure that you use the correct address for any deposit, withdrawal, or transfer, and that the address you use is a valid address for the VA that you intend to transfer and that the Company accepts to provide its Services. Any inaccuracy in a specified address, or in the VAs that you attempt to transfer between addresses, may result in total loss of the VAs concerned.

We hold your assets in designated “client money accounts”. These client money accounts are segregated from operational accounts and balances are maintained and reconciled against client liabilities at all times.

Varni Labs FZE has an unwavering commitment to rigorously examine Virtual Assets (VAs) before providing Services related to a particular VA. Varni Labs FZE shall assess each VA in relation to its Services beyond the technological evaluations and regulatory compliance considerations in order to ensure its full compliance with the regulatory requirements. This policy document lays out the criteria and process for the approval of each VA that Varni Labs FZE approves. It outlines Varni Labs FZE's dedication to maintaining the trust of its stakeholders, ensuring market stability, and contributing positively to the broader virtual asset landscape.

Varni Labs FZE shall, while conducting its due diligence on a VA, critically assess VA on considerations innovation, efficiency and functionality of each VA

The Assessment of each VA as required under Section 3.2 above shall consider certain parameters including but not limited to:

• Technology Evaluation: Security and Immutability of the VA and the underlying DLT Protocol - In order to ensure the VAs reliability, resilience, security, and capability to perform its intended functions, Varni Labs FZE will undertake a comprehensive technology evaluation. This evaluation will include a due diligence of the underlying technical infrastructure, and protocols supporting the VAs. Varni Labs FZE will assess factors such as system reliability, scalability, data integrity and network security. This assessment will also consider the VAs compatibility with industry standards and best practices.
• Governance Evaluation - Varni Labs FZE will conduct an evaluation of the governance structure of the VA to ensure transparency and accountability including mechanisms for addressing conflicts of interest. VASPs will also review the asset's governance policies, procedures, and guidelines to ensure they align with industry best practices and promote good governance principles.
• Legal and Regulatory Compliance Evaluation - Varni Labs FZE shall conduct an evaluation of the VAs legal and regulatory treatment and landscape. This evaluation shall encompass a due diligence of the VAs compliance with any applicable laws, regulatory treatment by the Virtual Asset Regulatory Authority, Dubai (VARA) and other appropriate authorities (including those outside of the Emirate of Dubai) and in particular whether the issuance of the VA has received any regulatory approvals from any regulatory authority within or outside the United Arab Emirates and whether a Virtual Asset is prohibited by VARA or any other appropriate authorities both inside or outside the UAE in jurisdictions in which Varni Labs FZE will provide its services, or equivalent activities, in relation to such Virtual Asset. Varni Labs FZE shall further evaluate whether the VA has any features which may materially affect Varni Labs FZE's compliance with applicable laws, Regulations, Rules or Directives, including but not limited to those relating to AML/CFT, sanctions, securities, intellectual property.
• Risk Management Evaluation - Varni Labs FZE shall assess the VA's terms and conditions, market capitalisation, fully diluted value liquidity, whether such metrics have trended downwards over time and, if the VA represents rights to any other assets, the enforceability of such rights. It shall assess the VAs design, features and use cases, whether or not intended by the issuer or relevant developers and whether the VA may be susceptible to price manipulation for any reason. Varni Labs FZE shall also consider the VAs future development [e.g. “roadmap”] as (and if) communicated by the issuer and/or relevant developers of the VA. This will help Varni Labs FZE to implement relevant mitigations against the risks identified. Varni Labs FZE shall consider the background of the VA's issuer including, but not limited to, the issuer's relevant experience in the VA sector and whether it has been subject to any investigations or claims in relation to fraud or deceit.

‍If you share your private keys, you run the risk of losing all your Virtual Assets. Transactions in VAs may be irreversible, and, accordingly, losses due to theft, fraudulent or accidental transactions may not be recoverable and the consequences could be irreversible. The nature of digital currency may lead to an increased risk of fraud or cyber-attack. Any individual VA may change or otherwise cease to operate as expected due to changes made to its underlying technology, changes made using its underlying technology, or changes resulting from an attack. Malicious individuals, groups or organisations may attempt to interfere with the Platform in a variety of ways, including, but not limited to, malware attacks, denial of service attacks, coordinated attacks, account takeovers and submitting fake transactions (including spoofing) which could negatively affect the Services.

You can take the following measures to protect your keys and/or seed phrases from misuse or unauthorised access:

• Enable Two-Factor Authentication (2FA): This adds an extra layer of security by requiring a second verification step, such as a unique code sent to their mobile device.
• Secure Storage of Keys and Seed Phrases: Clients should use offline or hardware wallets designed specifically for storing virtual assets. Additionally, keys should be saved offline and never revealed in plaintext to anyone, ideally keys should be stored in lockers.
• Backup and Recovery: Keys and seed phrases should be regularly backed up. Clients should store backups in multiple secure locations, preferably encrypted and offline, to protect against physical loss or damage.
• Monitor Account Activity: Encourage clients to monitor their account activity regularly and report any suspicious transactions or unauthorized access to the VASP immediately.

Varni Labs FZE has comprehensive policies in place and establishes a framework to encourage employees and stakeholders to report any wrongdoing or unethical behaviour. Varni Labs FZE ensures that whistleblowers are protected and that appropriate action is taken against any misconduct.

The policy is applicable to all employees, contractors, vendors, clients, and any person who becomes aware of any activity or behaviour that goes against the company's code of conduct, policies, or legal requirements. Varni Labs FZE acknowledges that whistleblowers play a vital role in maintaining integrity and ethical standards. It encourages the reporting of concerns in good faith and assures protection from retaliation. Varni Labs FZE has established secure channels that ensure confidentiality of the relevant parties. If you have any concerns relating to the activities of the company, please reach out to [email protected] or [email protected].

Varni Labs FZE's comprehensive internal controls and policies highlight its commitment to trust, integrity, and respect among its employees, customers, and stakeholders. In furtherance of its commitment to uphold fair treatment of all the stakeholders involved, including our customers, Varni Labs FZE has policies around fair treatment of all stakeholders, including its clients, directors, officers, contractors, and employees (Covered Persons).

Varni Labs FZE's Ethics and Conduct Policy is a comprehensive document that outlines the guidelines and principles to be followed by all Covered Persons. The policy aims to establish and maintain high standards of ethical conduct in all business dealings and provides guidance on appropriate behavior in various situations.

The Code of Conduct section outlines the following key values that all Covered Persons should abide by:

• Honesty: Varni Labs FZE expects honesty and truthfulness in all professional and business relationships. There should be no deliberate misleading or deceiving of others.
• Integrity: Personal and professional integrity must be demonstrated at all times, and individuals are expected to act for the absolute good in the interest of all stakeholders.
• Loyalty: Covered Persons should be loyal to Varni Labs FZE, colleagues, its clients, and business partners. They must avoid conflicts of interest and not use confidential information for personal gain.
• Accountability: All individuals are responsible for their decisions and actions, and they should take ownership of their work, mistakes, and behavior.
• Fairness: Dealing with others in a fair and just manner is essential, and everyone should respect the rights and dignity of others.
• Respect: Covered Persons should treat all colleagues with respect, courtesy, and fairness, promoting a diverse and inclusive working environment.
• Support and Collaboration: Openness, trust, and collaboration should be encouraged, and conflicts should be resolved in a professional and respectful manner.
• Reputation: Upholding the company's reputation and morale is vital, and inappropriate conduct should be corrected and prevented.
• Ethical Leadership: All individuals are expected to lead by example and consistently apply the values and principles outlined in the policy.
• Commitment to Excellence: Pursuit of excellence, innovation, and efficiency is encouraged to achieve the best results for the company.
• Compliance with Laws and Regulations: Adherence to all relevant laws, regulations, and company policies is essential.

The policy also addresses specific areas, such as conflicts of interest, protection of confidential information, data protection, anti-bribery and corruption, and prevention of financial crimes. Covered Persons are required to avoid situations that could impair their professional judgment and seek approval for any outside relationships that may pose a conflict of interest.

Regarding confidentiality, Covered Persons must protect and use confidential information responsibly, following the company's security and privacy policies. Any breach of confidentiality obligations is taken seriously and may result in appropriate action.

The policy emphasizes the prevention of bribery, corruption, and fraud and requires compliance with anti-money laundering, counter-terrorism financing laws, economic and trade sanctions regulations, and the company's anti-corruption and bribery policies.

The company promotes a safe, healthy, and inclusive workplace, free from discrimination, harassment, bullying, and exploitation. The policy highlights the importance of respecting diversity and inclusion in both physical and virtual workspaces.

The document includes guidelines for reporting violations of the policy and outlines procedures for managing conflicts and handling reported misconduct. It stresses the importance of cooperation in investigations and ensures confidentiality for whistleblowers.

Employees are required to undergo training on the policy, and all reports of potential violations are treated confidentially, without fear of retaliation.

Overall, the Policy serves as a guide to maintain the company's ethical culture and uphold its values in all aspects of its operations.

Varni Labs FZE does not and will not refer or introduce its clients/customers to any other entities/VASPs.

You can contact Varni Labs FZE via channels like Slack or via designated personnel. Customers can also contact Varni Labs FZE by emailing [email protected]

• Varni Labs FZE will try to resolve as many complaints as possible immediately, via the respective channel through which contact was established.
• In all cases, Varni Labs FZE will provide you an update on the status of the complaint, and explain any extraordinary circumstances that are delaying the resolution within four(4) weeks of the complaint being made. Varni Labs FZE will resolve all complaints no later than eight(8) weeks from when the complaint was made.
• There is no extra cost for raising a complaint. In case certain resolutions require a change in the scope of the product/service being offered to you, you will be made aware of it and, should you opt for it, your explicit consent will be sought and documented.
• Irrespective of the channel, please try and give Varni Labs FZE as much context as possible about the nature of your complaint. This will help us effectively come up with both short and long term solutions for you.

Please keep in mind where Varni Labs FZERoma operates as a B2B2C - so if you have been exposed to a product powered by Varni Labs FZERoma on a finance app, you will need to contact the respective bank or finance company.