Clapp Risk Disclosure Statement

Last Revised: 25.08.2026

1. Purpose and Status

1.1 This Risk Disclosure Statement describes the key risks of using the services offered through the Clapp website and the Clapp app (the “Platform”) by the companies of the Clapp group. It forms part of the Clapp Terms of Service, and terms defined there have the same meaning here. Where you use the Savings, Credit Line or Card products, this Statement should be read together with the terms of those products.

1.2 This Statement is not exhaustive. It describes the risks we consider most important, but other risks exist and new risks may emerge. You should not use the Services unless you understand the risks and can bear the loss of the assets involved. Never commit funds you cannot afford to lose.

1.3 Nothing on the Platform constitutes investment, legal, accounting or tax advice or a recommendation to buy, sell, hold, lend, borrow or spend any Digital Asset. We do not assess whether any Service is suitable for your personal circumstances. No fiduciary or advisory relationship arises between you and any Clapp group company, and you act at all times on your own judgment.

2. General Risks of Digital Assets

2.1 Digital Assets are high risk and highly volatile. You can lose all invested funds. Digital Assets are not legal tender in most jurisdictions, and they are not covered by deposit guarantee schemes or investor compensation schemes.

2.2 Transactions in Digital Assets are generally irreversible. Once a transfer has been confirmed on a blockchain network it cannot be cancelled or reversed by us, and we cannot recover assets sent to a wrong address, on a wrong network or to a person who refuses to return them.

2.3 Digital Assets depend on technology, on the continued operation of blockchain networks and on the conduct of many third parties over whom we have no control. The value of a Digital Asset may fall to zero, and a Digital Asset may lose its market entirely.

2.4 The Services are jurisdiction dependent, are not available in all countries and may be restricted, modified or withdrawn at any time for legal, regulatory or risk reasons. The Services available to you depend on your verified country of residence.

3. Market Risk

3.1 The value of Digital Assets can go down as well as up, rapidly and without warning, including in response to news, regulatory statements, security incidents, market manipulation or events affecting a single asset, exchange or issuer. Past performance is not an indication of future results.

3.2 Price movements can be large within minutes. For products that depend on the value of your assets, such as the Credit Line, a rapid fall in price can trigger liquidation of your collateral before you are able to react. For the Card, the value of your assets may fall between the time you fund your Wallet and the time you spend.

3.3 Yields, rates and limits shown in the app are not guarantees of future returns and may change as set out in the relevant product terms.

4. Liquidity Risk and Market Disruptions

4.1 Liquidity in Digital Asset markets can deteriorate suddenly. In stressed conditions, spreads widen, execution prices may differ materially from displayed prices, orders may be delayed or partially executed, and it may become impossible to buy or sell an asset at any price.

4.2 During market disruptions, including depegging events, forks, chain halts, exchange outages and severe illiquidity, we may widen spreads and haircuts, pause deposits, draws or withdrawals, adjust loan-to-value thresholds, delist assets and liquidate positions using commercially reasonable efforts, as described in the applicable product terms. These measures protect the Platform and its users as a whole and may operate to your disadvantage in an individual case.

4.3 Our prices are derived from our own price sources and may differ from prices on other venues. Triggers and calculations under the product terms are based on our internal rates.

5. Technology and Blockchain Risks

5.1 Blockchain networks and related software can suffer bugs, forks, halts, congestion, consensus failures, 51 percent attacks and other malfunctions. Smart contracts can contain vulnerabilities that lead to loss of assets. We do not control the underlying networks, and we are not responsible for their operation.

5.2 Deposits of unsupported assets, transfers to incorrect addresses and transfers on incorrect networks may result in permanent loss. We have no obligation to recover such assets. Any recovery we attempt is without guarantee and may be subject to a fee.

5.3 The Platform depends on internet connectivity, third party infrastructure and scheduled or emergency maintenance. Access to the Platform may be interrupted, and interruptions can coincide with sharp market moves, preventing you from trading, repaying, adding collateral or withdrawing at the time you wish.

5.4 Forks and airdrops may or may not be supported. Where we do not support a fork or airdrop, you may not receive the resulting assets.

6. Custody and Security

6.1 Digital Assets held in your Wallet are held in custody on your behalf. Private keys are managed using institutional custody technology with multi party computation, provided through qualified custody infrastructure providers. Digital Assets credited to your Wallet are held for you on a segregated basis, separate from our own assets, and are recorded in our books as client assets. Unless you use the Savings or Credit Line products, which have their own asset arrangements described in their terms, we do not lend, pledge or rehypothecate the Digital Assets held in your Wallet.

6.2 No custody arrangement removes all risk. Cyberattacks, theft, insider fraud, key management failures and failures of custody infrastructure providers can result in loss. Insurance held by our custody infrastructure providers may not cover a particular loss, and you should not assume that any loss will be reimbursed.

6.3 Digital Assets held in the Wallet are not bank deposits. They are not protected by any deposit guarantee scheme or investor compensation scheme.

6.4 You are responsible for the security of your own devices, email account, phone number and login credentials. Compromise of any of these can lead to loss of your assets. We will never ask you for your password. Losses caused by your failure to secure your credentials or devices are your responsibility.

7. Stablecoin Risk

7.1 Stablecoins, including USDT, USDC and EURC, are designed to track a reference currency but may fail to do so. A stablecoin may lose its peg temporarily or permanently, and a depeg can result in significant and permanent loss of value.

7.2 Stablecoins carry issuer risk, reserve risk, redemption risk, regulatory risk and blacklisting risk. The issuer may freeze or refuse to redeem tokens, may restrict holders in certain jurisdictions, and may become insolvent.

7.3 Where a product maintains your position in a stablecoin, including where fiat you deposit into Savings is converted into a euro referenced stablecoin as described in the Savings Terms, your position carries the risks of that stablecoin.

8. Regulatory and Legal Risk

8.1 Clapp Finance Limited is registered with FINTRAC (Canada) as a money services business. This registration is an anti money laundering registration; it does not mean that FINTRAC endorses or approves any product or service, and it is not an investor protection scheme. Clapp S.A. de C.V. is a registered Bitcoin Service Provider with the Central Reserve Bank of El Salvador; this registration covers bitcoin services only. No Clapp group company currently holds a crypto-asset service provider authorization under Regulation (EU) 2023/1114 (MiCA) or a registration with the UK Financial Conduct Authority. Regulators do not approve or endorse commercial products.

8.2 Where we state that an authorization or registration is being sought or is in process, it has not been granted, and no rights derive from it, unless and until we expressly confirm approval.

8.3 Some Services are provided by group companies established outside your country under registrations that do not provide the protections of your local regime. Rights and remedies available to you may therefore differ from those you would have with a locally licensed provider.

8.4 The regulation of Digital Assets is changing quickly in many jurisdictions. New laws, guidance, enforcement actions or court decisions may restrict or end the availability of Services in your country, require changes to products, affect the value or usability of Digital Assets, or require us to freeze, block or report assets and transactions. We may need to exit a market or off-board customers with limited notice where the law requires.

8.5 Digital Assets may be subject to sanctions, seizure orders and other legal measures. We may be required to freeze or surrender assets in your Account in compliance with applicable law or the order of a competent authority.

9. Tax

9.1 Buying, selling, exchanging, lending, borrowing, spending, converting and receiving Digital Assets may be taxable events in your jurisdiction. Deposits, interest, withdrawals, conversions, repayments and liquidations may all have tax consequences.

9.2 You are solely responsible for determining, reporting and paying your taxes. We do not provide tax advice. We may be required to report information about you and your transactions to tax authorities.

10. Product Specific Risks: Savings

10.1 Savings is a lending product. When you open a Savings position, you lend your Digital Assets to us: ownership of the deposited assets transfers to us, and you receive a contractual claim for the return of an equivalent amount of the same assets plus interest.

10.2 Savings balances are not bank deposits, are not covered by any deposit guarantee or investor compensation scheme, and are not crypto-asset services under MiCA; they do not benefit from MiCA safeguarding requirements. Savings is not within the service categories covered by the FINTRAC money services business registration, and no registration or license attaches to it.

10.3 Deposited assets leave the custodial arrangements of your Wallet. You bear our credit risk: if we cannot meet our obligations, you may lose some or all of your assets, and your claim will rank as an unsecured claim.

10.4 Rates for Flexible Savings are variable and may change with notice where feasible. Early termination of Fixed Term Savings is discretionary and results in forfeiture of accrued interest. Withdrawals may be suspended for operational, security, legal or regulatory reasons.

11. Product Specific Risks: Credit Line

11.1 The Credit Line is an over collateralized loan. Upon approval, you irrevocably transfer to us full legal and beneficial ownership of the Collateral as security for all of your obligations under the Credit Line. While the facility is outstanding, you do not hold title to the Collateral, and in the event of our insolvency your claim in respect of the Collateral is an unsecured contractual claim.

11.2 If your loan-to-value ratio reaches the liquidation threshold, some or all of your Collateral may be sold without prior notice, including in volatile markets and at unfavorable prices. Sharp price moves can make liquidation unavoidable even shortly after you post Collateral, and alerts may not reach you in time. On full repayment, an equivalent amount of the same assets is returned, not the identical units you posted.

11.3 Interest accrues daily on the drawn amount and compounds. Your available limit may fall automatically as Collateral Value declines. Borrowing against Digital Assets carries a risk of losing your Collateral and, in a shortfall, of remaining liable for the balance.

11.4 The Credit Line is not a bank product, is not covered by any deposit guarantee or investor compensation scheme, and is not within the service categories covered by the FINTRAC money services business registration.

12. Product Specific Risks: Card

12.1 The Clapp Card is issued by a licensed card issuer identified in the Clapp app. Clapp Limited (Hong Kong) distributes and services the program. Funds and Digital Assets linked to the Card are not bank deposits and are not covered by the Hong Kong Deposit Protection Scheme or any equivalent scheme.

12.2 Digital Assets are converted to fiat at the moment of the transaction. Conversion rates and fees are shown in the app. Because conversion happens at authorization, the amount debited may differ from amounts displayed earlier, and the value of your assets may fall between funding your Wallet and using the Card.

12.3 Offline, force captured and delayed transactions can result in a negative balance that you must repay. Merchant acceptance, authorization holds and network availability are outside our control. The Card may be suspended or terminated where required by the issuer, the card network, a regulator or applicable law.

13. Euro Accounts and IBAN

13.1 Euro accounts, IBANs and SEPA payments may be provided by our partner institution or institutions, including electronic money institutions authorized in the respective jurisdiction, under their own terms. Your euro balance is safeguarded by the partner institution in accordance with its regulatory obligations, not by us.

13.2 Your relationship for those services is with the partner institution. Access to euro services depends on the continued availability of the partner institution and on your meeting its eligibility and compliance requirements. Payments may be delayed, rejected or reversed by the partner institution or by banks in the payment chain.

14. Conflicts of Interest and Execution

14.1 We act as your counterparty in exchange transactions and our prices include a fee or spread. We may earn revenue from the use of assets you lend to us under Savings, from interest on the Credit Line, from card interchange and from partner arrangements. These interests may differ from yours.

14.2 We may suspend, restrict or discontinue any product or feature for commercial, legal, regulatory or risk reasons, with notice where feasible.

15. Third Party and Counterparty Risk

15.1 The Services depend on third parties, including custody infrastructure providers, liquidity venues, banks, payment institutions, card issuers, card networks, identity verification providers and cloud providers. Failure, insolvency, error or misconduct of any of them can affect the Services and your assets. Each Clapp group company is responsible only for the services it provides to you.

16. Notice for EEA Users

16.1 Crypto lending and borrowing are not regulated under Regulation (EU) 2023/1114 (MiCA). The Savings and Credit Line products are provided by a company established outside the EEA and do not benefit from MiCA protections, including safeguarding and complaint handling under MiCA. Assets you lend leave your custodial wallet and become a claim against the provider.

16.2 Crypto-asset services offered through the Platform are provided by group companies established outside the EEA that are not authorized under MiCA. The protections MiCA gives to clients of authorized crypto-asset service providers do not apply to those services.

17. Acknowledgment

17.1 By using the Services you confirm that you have read and understood this Statement, that you accept the risks described in it, and that you have the knowledge and experience to evaluate the Services and the financial capacity to bear the loss of the assets you commit.