[Disclaimer Updates] Latest Update Time: 2023-12-25 

This Risk and Compliance Disclosure should be read in conjunction with Scratch Customer Agreement (Terms). In plain English, we expect you to understand the important compliance matters and liability clauses while you trade on our platform.

PURPOSE OF OUR PROGRAM
We have established and implemented an Anti-Money Laundering, Anti-Terrorist Financing, and Trade & Economic Sanctions Program to ensure a robust and compliant digital asset trading platform. We want to promote legal, transparent business activities and maintain a strong reputation among our customers, regulators, and the digital asset industry.

REGULATORY LANDSCAPE
We understand that regulatory bodies have taken a diverse approach to the laws and regulations regarding digital assets, including some characterizing or defining digital assets as a virtual financial asset (by Malta), convertible virtual currency (by USA FinCEN) or virtual commodity (by Hong Kong). As a trading platform, we believe that all digital assets available on Scratch are an innovative alternative asset class; therefore, digital assets should not be called currency or money.

DISCLOSURE
Digital assets are not fiat money nor fiat currency. Digital assets are NOT backed by any government or central bank. We may at times have opinions

on the different regulatory approaches taken by various government bodies; however, at all times, we will fully abide by the rules and regulations of the respective countries we operate in. We regularly communicate with regulators and industry on the best approach to regulating digital asset businesses.

We cooperate with governments and respect regulations and comply with applicable regulations. As good corporate citizens, we may be asked for information from law enforcement authorities and will assist if permissible by law as law enforcement conduct investigations to pursue and thwart illicit activity. What this also means is that our platform is intended for law-abiding customers. We would like to serve you while you act legally and properly on our platform.

Furthermore, Scratch does not accept certain customers. To maintain our strong reputation in the market and ensure a robust compliant marketplace, we have decided to not seek nor accept customers from certain jurisdictions including Afghanistan, Burundi, Central African Republic, Congo, Mainland China, Hong Kong Special Administrative Region, Macau Special Administrative Region, Singapore, Ethiopia, Guinea, Guinea-Bissau, Iraq, Iran, Democratic People’s Republic of Korea, Lebanon, Sri Lanka, Libya, Netherlands, Serbia, Sudan, Somalia, South Sudan, Syrian Arab Republic, Thailand, Tunisia, Trinidad and Tobago, Uganda, Venezuela, Yemen, Zimbabwe and Cuba. This list of excluded countries may change and may vary by service. For residents of the United States and Canada, we may be able to provide certain trading services to eligible users based on the respective MSB regulations. For more information, please contact Scratch online support.

OUR AML/ATF PROGRAM
We have designed our Program to be anti-money laundering (AML) and anti-terrorist financing (ATF) through a risk-based and multi-layer control system.

The first layer includes a stringent customer identification program, including verifying the identity of our customers, whether individuals or entities. In addition to obtaining identification documents, we obtain for non-natural persons their entities’ beneficial owners/natural persons consistent with international standards such as the Financial Action Task Force (FATF).

The second layer includes a risk-based system to warrant additional customer due diligence. To accomplish this, we screen our customers (including beneficial owners) against the entities/persons on The Government of the Hong Kong SAR Gazette, United States Office of Foreign Assets Control (OFAC) Sanctions Lists, and the United Nations Security Council Sanctions List, among other government-provided lists of sanctioned individuals and entities. We also may screen against other lists on a discretionary basis to protect our reputation and customers.

The third layer includes ongoing monitoring for suspicious activity. If our Program suspects or has reason to suspect suspicious activities have occurred, we will file suspicious activities reports with local regulators. A suspicious transaction is often inconsistent with a customer’s known and legitimate business or personal activities.

RISKS
Trading in digital assets is considered highly risky. Digital assets are NOT backed by any government or central bank. The risk of loss in trading or holding digital assets can be substantial. You should carefully consider whether interacting, holding, or trading digital assets is suitable for you in light of your financial condition.

LIABILITY
6.1. Disclaimer of Warranties

For the purposes of this document, all and any services provided via the Scratch platform or through its associated companies and/or partners, whether related to cryptocurrency, and/or its derivatives and the trading thereof, shall be collectively known as “the Services”.

TO THE MAXIMUM EXTENT PERMITTED UNDER APPLICABLE LAW, THE SERVICES, THE Scratch MATERIALS AND ANY PRODUCT, SERVICE OR OTHER ITEM PROVIDED BY OR ON BEHALF OF Scratch ARE PROVIDED ON AN “AS IS” AND “AS AVAILABLE” BASIS.

AND Scratch EXPRESSLY DISCLAIMS, AND YOU WAIVE, ANY AND ALL

OTHER WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, OR NON-INFRINGEMENT OR WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING, OR USAGE IN TRADE.

WITHOUT LIMITING THE FOREGOING, Scratch DOES NOT REPRESENT OR WARRANT THAT THE SITE, THE SERVICES, OR Scratch MATERIALS ARE ACCURATE, COMPLETE, RELIABLE, CURRENT, ERROR-FREE, OR FREE OF VIRUSES OR OTHER HARMFUL COMPONENTS. Scratch DOES NOT GUARANTEE THAT ANY ORDER WILL BE EXECUTED, ACCEPTED, RECORDED, OR REMAIN OPEN. EXCEPT FOR THE EXPRESS STATEMENTS SET FORTH IN THIS AGREEMENT, YOU HEREBY ACKNOWLEDGE AND AGREE THAT YOU HAVE NOT RELIED UPON ANY OTHER STATEMENT OR UNDERSTANDING, WHETHER WRITTEN OR ORAL, WITH RESPECT TO YOUR USE AND ACCESS OF THE SERVICES.

WITHOUT LIMITING THE FOREGOING, YOU HEREBY UNDERSTAND AND AGREE THAT Scratch WILL NOT BE LIABLE FOR ANY LOSSES OR DAMAGES ARISING OUT OF OR RELATING TO:

(A) ANY INACCURACY, DEFECT, OR OMISSION OF DIGITAL CURRENCY PRICE

DATA,
(B) ANY ERROR OR DELAY IN THE TRANSMISSION OF SUCH DATA,
(C) INTERRUPTION IN ANY SUCH DATA, AND
(D) ANY DAMAGES INCURRED BY ANOTHER USER’S ACTIONS, OMISSIONS, OR VIOLATION OF THIS AGREEMENT.

6.2. Disclaimer of Damages and Limitation of Liability

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT WILL Scratch, ITS AFFILIATES, AND THEIR RESPECTIVE SHAREHOLDERS, MEMBERS, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS, AGENTS, REPRESENTATIVES, SUPPLIERS, OR CONTRACTORS BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL, OR SIMILAR DAMAGES OR LIABILITIES WHATSOEVER (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF DATA, INFORMATION, REVENUE, PROFITS, OR OTHER BUSINESS OR FINANCIAL BENEFIT) ARISING OUT OF OR IN CONNECTION WITH THE SERVICES, ANY PERFORMANCE OR NON-PERFORMANCE OF THE SERVICES, OR ANY OTHER PRODUCT, SERVICE, OR OTHER ITEM PROVIDED BY OR ON BEHALF OF Scratch AND ITS AFFILIATES, WHETHER UNDER CONTRACT, STATUTE, STRICT LIABILITY, OR OTHER THEORY

EVEN IF Scratch HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, EXCEPT TO THE EXTENT OF A FINAL JUDICIAL DETERMINATION THAT SUCH DAMAGES WERE A RESULT OF Scratch’s GROSS NEGLIGENCE, FRAUD, WILLFUL MISCONDUCT, OR INTENTIONAL VIOLATION OF LAW. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR CONSEQUENTIAL DAMAGES, SO THE ABOVE LIMITATION MAY NOT APPLY TO YOU.

NOTWITHSTANDING THE FOREGOING, IN NO EVENT WILL THE LIABILITY OF Scratch, ITS AFFILIATES, AND THEIR RESPECTIVE SHAREHOLDERS, MEMBERS, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS, AGENTS, REPRESENTATIVES, SUPPLIERS, OR CONTRACTORS ARISING OUT OF OR IN CONNECTION THE SERVICES, ANY PERFORMANCE OR NON-PERFORMANCE OF THE SERVICES, OR ANY OTHER PRODUCT, SERVICE, OR OTHER ITEM PROVIDED BY OR ON BEHALF OF Scratch OR ITS AFFILIATES, WHETHER UNDER CONTRACT, STATUTE, STRICT LIABILITY, OR OTHER THEORY, EXCEED THE AMOUNT OF THE FEES PAID BY YOU TO Scratch UNDER THIS AGREEMENT IN THE TWELVE-MONTH PERIOD IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE CLAIM FOR LIABILITY.

LANGUAGE OF USE
This Disclaimer may be published in different languages. In case of any discrepancy, please refer to the English version.