Risk Disclosure

1. General Investment Risks

Investing in real-world assets through the Squire Invest platform involves significant risk. The value of your investments can go down as well as up, and you may receive back less than you originally invested. There is no guarantee of returns, and historical performance is not indicative of future results. Expected yields and projections displayed on the Platform are estimates only and are not guaranteed.

Investment Parameters

• Minimum investment: 100 SQR per asset
• Maximum investment: 25% of any single asset's funding goal
• Funding periods: 14 to 90 days per asset
• Minimum funding threshold: 80% of goal (if not reached, funds are returned)
• Higher KYC verification tiers are required for larger transaction amounts

2. Illiquidity Risk

Fractional asset tokens may have limited secondary market liquidity. You may not be able to sell or transfer your position when you wish, or you may only be able to do so at a significant discount. Investment terms are typically fixed, and early redemption may not be available or may incur penalties.

3. Asset-Specific Risks

The Platform offers investments across seven asset categories, each with distinct risk profiles:

• Real Estate (Low Risk, 1–10 year terms) — market fluctuations, tenant vacancy, maintenance costs, property damage, regulatory changes, environmental liabilities
• Commercial Vehicles (Medium Risk, 1–7 year terms) — depreciation, maintenance costs, operator risk, fuel price volatility, accident liability
• Agriculture (Medium Risk, 3–12 month terms) — weather events, crop failure, commodity price volatility, pest infestations, water scarcity, seasonal dependencies
• Timber (Low Risk, 7–25 year terms) — long maturation cycles, fire risk, disease, environmental regulation changes, market demand shifts
• Digital Assets (High Risk, 1–36 month terms) — extreme price volatility, regulatory uncertainty, technology risk, counterparty risk
• Infrastructure (Low Risk, 5–20 year terms) — construction delays, cost overruns, regulatory approvals, technological obsolescence, political risk
• Inventory Finance (High Risk, 30–180 day terms) — supply chain disruptions, buyer default, perishability, quality disputes, trade risk

Risk tier classifications (Low, Medium, High) are indicative assessments and do not guarantee the actual risk level of any individual asset.

4. Blockchain and Smart Contract Risks

The Platform operates on BNB Smart Chain (BSC) as the primary network and Polygon as the secondary network. Blockchain technology and smart contracts carry inherent risks:

• Smart contracts may contain undiscovered vulnerabilities or bugs, despite auditing
• Blockchain networks may experience congestion, forks, or outages
• Transactions on public blockchains are irreversible once confirmed
• Private keys, if lost, cannot be recovered — the Platform operates on a self-custody model and cannot access or recover your private keys
• Smart contracts include emergency pause mechanisms that may temporarily restrict access to funds during critical situations
• Regulatory treatment of blockchain-based assets remains evolving and uncertain

Cross-Chain Bridge Risks

Transfers between BSC and Polygon use a cross-chain bridge, which carries additional risks including bridge smart contract vulnerabilities, peg risk (mismatch between wrapped and native tokens), and transfer delays (typically 5–30 minutes but potentially longer during network congestion). A 0.5% bridge fee applies.

5. Manager Risk and Investor Protection

Asset managers are responsible for the operational management of their assets. There is a risk that managers may underperform, act negligently, or fail to fulfill their obligations.

Manager Tier System

Managers are classified into tiers (Emerging, Established, Professional, Institutional) based on staking requirements and track record. Higher tiers require larger stakes, providing greater alignment of interests. However, manager tier classification does not guarantee performance or the success of their assets.

Milestone-Based Escrow

Funds are released to managers through milestone-based escrow, not as a lump sum. Milestones exceeding 10% of total funding require Investor Advisory Committee (IAC) approval. While this reduces risk of misuse, it does not eliminate it.

Slashing Protections

Manager stakes are subject to slashing for violations: 10% for first failed milestone, 25% for repeated failures, 50% for asset abandonment, and 100% for fraud. Slashing provides partial restitution but may not cover full investor losses.

6. Dividend and Return Risks

Dividend distributions are not guaranteed and depend on asset performance. Key considerations:

• A 5% reserve is maintained on distributions for contingencies
• A 0.25% dividend payout fee applies to each distribution
• Unclaimed dividends expire 365 days from the distribution date
• Minimum distribution is 1 SQR per investor per period; if insufficient, distribution may be deferred

7. Regulatory and Legal Risks

The regulatory environment for blockchain-based investment platforms is evolving. Changes in laws or regulations could adversely affect the Platform, the assets offered, or your ability to access your investments. Different jurisdictions may classify tokenized assets differently, potentially affecting your tax obligations or legal rights. The Platform is not available in certain prohibited jurisdictions (see our Terms of Service).

8. Platform and Operational Risks

While we implement security measures including AES-256-GCM encryption, TLS 1.3, and regular security audits, there are inherent risks associated with any technology platform:

• System outages or technical failures
• Cybersecurity breaches despite security controls
• Third-party service provider failures
• Operational errors in transaction processing
• Dependence on blockchain network availability and gas costs

9. Counterparty Risk

Investments made through the Platform involve counterparty risk. Asset managers, tenants, buyers, and other parties may default on their obligations. The Platform does not guarantee the performance of any counterparty, and the slashing mechanism provides only partial protection.

10. Currency and Token Risk

Investments are denominated in SQR tokens. The value of SQR relative to fiat currencies may fluctuate, which could affect the real-world value of your investments and returns. SQR tokens are subject to a deflationary burn mechanism (0.1%–1% per transaction), which affects the circulating supply over time.

Conversion between cryptocurrencies and fiat currencies may incur additional fees (0.5% deposit fee, 1.0% withdrawal fee) and exchange rate risk.

11. Staking Risks

If you participate in token staking:

• Staked tokens are locked for periods ranging from 7 days to 2 years
• Early unstaking incurs an approximately 10% penalty
• Staked tokens cannot be sold or transferred during the lock period
• Governance misbehavior (e.g., voting for malicious proposals) may result in slashing
• Staking APY (5%–15% depending on lock period) is variable and not guaranteed

12. No Financial Advice

Nothing on the Platform constitutes financial, investment, legal, or tax advice. You should consult qualified professionals before making investment decisions. You are responsible for understanding and complying with your local tax obligations related to digital asset investments and dividend income.

13. Investor Suitability

Investments on this Platform may not be suitable for all investors. You should carefully consider your financial situation, investment objectives, and risk tolerance before investing. Certain investment amounts may require accredited investor status (income exceeding $200,000 individual or $300,000 joint for two consecutive years, or net worth exceeding $1,000,000 excluding primary residence). Do not invest more than you can afford to lose.

14. Contact

If you have questions about the risks associated with investing through Squire Invest, contact us at support@squirecoin.com. For compliance inquiries, contact compliance@squirecoin.com.

See also our Terms of Service and Privacy Policy.