Potential and current clients (“you” or “your” or “yourself”) are required to familiarize yourself with the risks outlined in this document in order to fully understand the risks involved with trading in cryptocurrencies before opening or trading with KryptoKnights (“us”, “we”, or “our”). As a potential or current client, you must accept and understand the prospective risks involved with using our services before deciding to invest any funds into trading in the Cryptocurrency environment.
This document does not serve as a complete account of all possible risks when trading in cryptocurrencies, but seeks to serve as an outline of general risks involved in the trading of cryptocurrencies.
You should not invest with funds that you cannot afford to lose. Trading in cryptocurrencies is highly volatile, and involves a high amount of risk in which you may lose some or all of your invested funds. KryptoKnights does not offer any financial advice and, as such, you should consult with a financial adviser in order to take professional advice regarding trading choices and evaluate whether investing is suitable given your financial standing.
Above all, you are hereby made aware of the fact that you run the risk of losing your capital as a result of any trade choice you make.
You are also hereby made aware of the fact that this document forms part of the Terms and Conditions of service.
You are specifically drawn and made aware of the following risks:
There is no guarantee that you will obtain a specific outcome and due to this, there is no guarantee of return on the funds in your trading account.
Regardless of any information provided by the Company, the value of an investment is volatile and it is probable that it may become of no value.
The previous performance of a financial instrument does not guarantee its current or future performance. The use of historical data does not constitute a future outcome on the performance of a specific trade. Trading in crytpocurrencies is applicable only to individuals who: (a) are willing to assume the risks associated with such transactions; and (b) are financially capable of withstanding losses of their initial investment and any additional capital used to maintain their positions.
Any transaction undertaken through us is of a speculative nature and substantial losses may be incurred in the process of trading. Due to this, you are solely responsible for monitoring of your account and to ensure that all trades you place are satisfactory in nature.
Risks in trading cryptocurrencies:
While we may request information about your financial status, we do not monitor your financial status and the appropriateness of your investment choices. You are solely responsible for this undertaking. You are solely responsible for monitoring your trading account and depositing the necessary funds needed to maintain your positions. If the margin capital required to keep a position open is insufficient, you may be asked to deposit additional funds or to reduce exposure. Failure to do so may result in the liquidation of positions at a loss. You will, as a result, be liable for any related deficits.
Before you open a trade, you are required to fund your trading account with an Initial Margin and, in order to keep a Transaction open, you must ensure that the amount in your Trading Account exceeds the Maintenance Margin. The Initial Margin will differ between Instruments and the amounts will be indicated on the Trading Platform. This means that you will be trading using ‘leverage’ or ‘gearing’ and this can work for or against you; a small price movement in your favour can result in a high return on the Initial Margin placed for the trade, but a small price movement against you may result in substantial losses.
Cryptocurrency trades are derivative financial instruments with prices that are derived from their underlying asset (e.g. commodities, stocks, indices, or currencies). Derivative financial instruments are highly volatile and the prices of these trades and their underlying assets may fluctuate rapidly due to changes in market conditions. The prices of cryptocurrencies are impacted by a number of factors, including fluctuations in supply and demand, governmental actions, trade policies, international events, and consumer sentiment.
Trading in cryptocurrencies is highly speculative and involves a high degree of risk. Because trades are conducted using a margin that only covers a nominal percentage of the value of the underlying asset being traded, small price changes in the position’s underlying asset may result in the partial or complete loss of invested capital. Prior to trading, you must understand that you may lose the margin held in your trading account that serves as collateral for opening and maintaining trading positions.
When you enter into a trade, you are placing a trade related to price movements set by the Company. Prices quoted to you by the Company are comprised by a spread, mark-up, or mark-down as compared to prices the Company may receive if it were to cover transactions with you by a trade in the third party.
The leverage available for trades is a particular feature of cryptocurrency trading (i.e. the funds you are required to deposit when a position is opened compared to the notional size of a trade you enter into). This means that a nominal margin deposit can lead to large losses as well as gains.
You will be liable to the Company for all losses that you sustain, in addition to other amounts payable under the terms and conditions for trading. If you decide to enter a trade, you agree to accept this risk.
Cryptocurrency trading transactions have a contingent liability, as you are required to deposit funds in to your trading account in order to open a position. Margin requirements are related to the underlying cryptocurrency and can be calculated from the current price of the underlying cryptocurrency.
With regards to cryptocurrency transactions, we reserve the right to close positions when margin reaches 100% and to liquidate your account if margin levels drop below 90%.
You may only enter into trades with us for the underlying assets that are offered by us. We do not warrant to continue offering all such underlying assets. All cryptocurrency prices are derived from the prices of the underlying assets and come from the applicable liquidity provider.
We have no control over the fluctuations in the underlying asset prices which may be volatile. Such movements will impact whether you can open and close positions, as well as the prices quoted by our liquidity provider.
We may have access to information that is not available to you. Subject to our Best Execution Policy, we do not warrant to provide you with market information that it possesses.
Market Related Risks
Due to the changing market conditions, you understand that in abnormal market conditions order executions may vary in periods, or execution may not be possible at all. Further, certain conditions in the market may result in volatility of the market itself. In these conditions, there is a risk that orders issued to protect open positions, or to open new positions, may be executed at prices significantly different from previous prices.
Charges and fees
Our Services provided to you may be subject to charges/fees, which shall be duly communicated to you. The Company may change its fee structures at any time.
It is your responsibility to remain updated of any amendments.
Before placing trades, you should obtain all information regarding fees and commissions. If you do not understand how specific fee structures and commissions are calculated, you should ask for a detailed explanation.
Your trades may be subject to tax and other duties due to legal regulations or personal circumstances. It is also your duty to inform yourself of these taxes and duties in order to fully understand the costs of trading.
Transactions undertaken under the Agreement may be subject to taxes and other duties in certain jurisdictions. We do not warrant that such taxes or duties will not be payable as such.
You are solely responsible for any taxes or duties that may be incurred as a result of trading activities.
Technologically Related Risks
You are solely responsible for the risks of financial losses caused by system malfunction, interruption, disconnection, electricity failure, and communication errors.
In the event that you undertake transactions on an electronic system, you will be exposed to risks relating to the system, including the failure of hardware, software, servers, and communication lines. The consequences of any such failure may cause your order to not be executed according to your instructions, or to not be executed at all. The Company does not accept any liability in the case of any such failure.
During high traffic periods, you may experience difficulties connecting to our system(s), particularly during volatile market periods (for example, when key macroeconomic indicators are published).
You are aware and acknowledge that the Internet may be subject to events that may impact your access to our system, including but not limited to interruptions or transmission blackouts, software and hardware failure, internet disconnection, electricity failures, or malicious attacks. Unless otherwise specified, the Company shall not be held liable for any damages or losses resulting from such events, or for any other losses, costs, liabilities, or expenses that may result from your inability to access our systems.