Crypto Asset Statement - The Graph (GRT)

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Note: Right now this currency is only being offered to select Private Wealth clients. Click here to learn more about our Private Wealth (OTC) team and what they can do for you.

About this Statement

Bitbuy Technologies Inc. (“Bitbuy” or “we”) believes that our users should understand the crypto assets that they are able to trade using our crypto trading platform (the “Platform”). One of the crypto assets we offer through the Platform is GRT. We created this summary to help you understand the basics of GRT as well as some of the risks involved in acquiring it. While we tried to describe the key features of GRT here, this summary isn’t meant to tell you everything you’d want to know before acquiring it. You should also do your own research on GRT to make sure you are comfortable acquiring it.

Description of GRT

GRT is an Ethereum-based token (known as an ERC-20 token) used to allocate resources in the open-sourced network called The Graph Network (“The Graph”). The Graph is a decentralized protocol that collects, processes and stores data from various blockchains in order to facilitate information retrieval. The Graph’s function is to help developers use relevant data to increase the efficiency of their decentralized application. The Graph was founded in 2018 by Yaniv Tal, Jannis Pohlmann and Brandon Ramirez. Governance of The Graph Network is now overseen by The Graph Foundation and The Graph Council.

At a high level, The Graph is an indexing protocol for querying networks like Ethereum and IPFS (InterPlanetary File System). The Graph allows developers to build and publish open application programming interfaces, called “subgraphs”, which make data easily accessible. In order to help process data and pass them on to end-users and applications, users of The Graph are able to provide services to the network in the role of an indexer or delegator. An indexer stakes GRT in order to provide indexing and query processing services. In return for their services, an indexer earns query fees and indexing rewards as well as rebates from a pool that is shared with all other network contributors. Delegators are network participants who stake GRT to one or more indexers. By delegating to an indexer, delegators earn a portion of the indexers query fees and rewards. Users may also participate in The Graph as a curator. Curators use their knowledge to assess and “signal” on the subgraphs that should be indexed by The Graph because of their high quality. The Graph Network rewards curators that signal on high quality subgraphs by rewarding them with a share of the query fees that subgraphs generate.

For users of the Graph network to perform their roles and earn fees from the network, they must stake GRT. Users who stake their GRT can earn fees from the network proportional to the amount of work they perform and the amount in which they stake. Once staked, users can also participate in decisions affecting The Graph and vote on proposals for the rules that govern the platform’s use. GRT is also used by developers and other end-users to pay for the queries they submit to subgraphs.

Risks

The strength of GRT is heavily dependent on the strength and performance of The Graph. If The Graph were to experience a serious issue, GRT’s price could be adversely impacted. Also, as The Graph runs on the Ethereum blockchain, if Ethereum were to crash or experience serious issues, GRT’s price could also be adversely impacted.

Like other crypto assets, there are also some general risks associated with acquiring GRT. We describe many of these general risks in the risk statement we publish on our website, including risks relating to: (i) volatility; (ii) access, loss or theft, (iii) control of processing power; (iv) settlement of transactions on crypto asset networks; (v) momentum pricing; (vi) private keys; (vii) internet disruptions; (viii) faulty code; (ix) network development and support; (x) regulatory risk; (xi) network forks; (xii) air drops; (xiii) voting rights; (xiv) cybersecurity incidents and other systems and technology problems; and (xv) unforeseeable risks. While we tried to describe the key risks associated with GRT here and in our risk statement, these aren’t all of the risks associated with trading in GRT. You should also do your own research on GRT to make sure you are comfortable acquiring it.

How Bitbuy Decides to List Crypto Assets

Bitbuy reviews crypto assets before making them available for trading on the Platform. In making our decision to list a new crypto asset, we consider publicly available information about the crypto asset, including (among other things) its creation, design, governance, usage, supply, demand, maturity, utility, liquidity, material technical risks and legal and regulatory risks.

To date, we have only made crypto assets available for trading on the Platform which have significant supply, demand and liquidity. In our experience, crypto assets with these qualities tend to also satisfy the other criteria we evaluate as part of our review. That being said, our review process is fulsome and flexible, and we don’t prioritize any one factor over another. You should review the risk statement published on our website for more information about our procedures for determining whether to make a crypto asset available for trading on the Platform.

Regulatory Information

Bitbuy is offering crypto contracts to purchase and sell GRT in reliance on a prospectus exemption contained in the exemptive relief decision Re Bitbuy Technologies Inc. dated November 30, 2021. The statutory rights of action for damages and the right of rescission in section 130.1 of the Securities Act (Ontario) and similar legislation in the other provinces and territories of Canada would not apply in respect of a misrepresentation in this statement.

No Canadian securities regulatory authority has expressed an opinion about GRT, including an opinion that GRT is not itself a security and/or derivative.

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