Paxos Terms & Conditions

EXCHANGE TERMS AND CONDITIONS

As a customer of Digital Brokerage Services LLC (“DBS”), these Exchange Terms and Conditions (hereinafter “Agreement” or “Terms and Conditions”) constitute the main set of terms and conditions for the access and use of your Account related to the crypto asset Exchange and Custody services provided to you by Paxos Trust Company, LLC (“Paxos”) and accessible via Plynk (the “App”). References to “we,” “our,” or “us” are to Paxos, and references to “you” or “your” are to the User who is bound by these Terms and Conditions.

THIS AGREEMENT IS A LEGAL CONTRACT BETWEEN YOU AND PAXOS. DBS IS NOT A PARTY TO THIS AGREEMENT AND DOES NOT HAVE ANY OBLIGATIONS, RESPONSIBILITIES OR LIABILITY UNDER THIS AGREEMENT. YOU SHOULD TREAT IT AS ANY OTHER LEGAL CONTRACT BY READING ITS PROVISIONS CAREFULLY, AS THEY WILL AFFECT YOUR LEGAL RIGHTS. BY USING THE EXCHANGE OR CUSTODY IN ANY MANNER, YOU ARE DEEMED TO HAVE READ, UNDERSTOOD AND AGREED TO BE BOUND BY ALL OF THE TERMS CONTAINED IN THIS AGREEMENT, EXCEPT AS OTHERWISE EXPLICITLY INDICATED. YOU MAY NOT PICK AND CHOOSE WHICH TERMS APPLY TO YOU. IF YOU DO NOT AGREE WITH ALL OF THE TERMS IN THIS AGREEMENT, YOU MUST NOTIFY PAXOS IMMEDIATELY AND CEASE ALL ACCESS AND USE OF THE EXCHANGE, AND PAXOS WILL RETURN ANY PROPERTY TO YOU THAT WE ARE HOLDING AS CUSTODIAN. NOTHING IN THIS AGREEMENT IS INTENDED TO CREATE ANY ENFORCEMENT RIGHTS BY THIRD PARTIES. PAXOS DOES NOT PROVIDE TAX ADVICE AND ENCOURAGES YOU TO CONSULT WITH YOUR TAX PROFESSIONAL.

Should you have any questions or comments regarding any Paxos services and products, please reach out to our customer support team by submitting a support ticket via this link: https://help.paxos.com/hc/en-us/requests/new.

These Terms and Conditions govern the access and use of all Accounts on the Exchange. If you fail to indicate your agreement to this Agreement, you understand and agree that you will not be allowed to utilize the Account, Exchange or Custody.

1. DEFINITIONS

“Account” means your account with the Exchange.

“Custody” means the custody services provided by Paxos to you with respect to crypto assets.

“Exchange” means the crypto asset exchange owned and managed by Paxos and made available for use to you via the App.

“Financial Institution” means DBS, your financial institution, with which Paxos has an agreement to offer you access and use of your Account, the Exchange, and Custody.

“Market Data” means the market value data compiled and published by Paxos, including bid prices, ask prices, trade prices, and trading volume. Trading volume is calculated by adding together the notional values of trades executed on the Exchange.

“Marketplace Rules” means those rules relevant to the Exchange provided in the Marketplace Rules Appendix.

“Omnibus Account” means a pooled custodial account maintained by Paxos to hold your funds.

“User” means any individual, institution or other person or entity that accesses and/or uses the Account, Exchange or Custody.

2. THE EXCHANGE

2.1 The Exchange allows Users to trade crypto assets, with the Exchange acting in an agency capacity. All crypto assets exchanged or traded by and between our Users are sourced from the Users themselves. All crypto assets transferred to us by Users for use in trading on the Exchange are deposited by the Exchange into, and are held in, an Omnibus Account, controlled by the Exchange. The Exchange enables Users to offer a trade at a given price, or to accept a trade at a price that another User has offered. When the Exchange matches orders of its Users (i.e., a User accepts a trade offered by another User), a trade occurs. This trade transfers ownership between Users and is reflected in adjustments to Users’ crypto asset balances on our ledger. All trading activity on the Exchange is “off-chain” and is not broadcast to the applicable blockchain.

2.2 Crypto assets available on the Exchange for trading and custody include Bitcoin, Ethereum, Litecoin, and Bitcoin Cash, all of which were approved for customers of Paxos through specific approval from the New York State Department of Financial Services. Paxos does not accept fees or other monetary or in-kind compensation from the issuers of these supported tokens, except that we may earn interest and/or other earnings where we custody reserves backing U.S. dollar stablecoins. Restrictions may apply in accordance with applicable law.

3. CRYPTO ASSET RISKS

3.1 As crypto assets are not legal tender and not backed by the government, they are subject to enhanced risks. These risks include (but are not limited to) the following:

(a) accounts and value balances of crypto assets are not subject to Federal Deposit Insurance Corporation or Securities Investor Protection Corporation protections;

(b) legislation and regulation (or lack thereof) of crypto asset or crypto exchanges can change at any time, which may adversely affect the use, transfer, exchange, and/or value of crypto assets;

(c) once executed, a crypto asset transaction may be irreversible and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable;

(d) some crypto asset transactions shall be deemed to be made when recorded on a public ledger (e.g., a blockchain), which is not necessarily the date or time that the customer initiates the transaction;

(e) the value of crypto asset may be derived from the continued willingness of market participants to exchange fiat currency for crypto asset, which may result in the potential for permanent and total loss of value of a particular crypto asset should the market for crypto assets collapse;

(f) there is no assurance that a person who accepts a crypto asset as a payment today will continue to do so in the future;

(g) the volatility and unpredictability of the price of crypto asset relative to fiat currency may result in significant loss over a short period of time;

(h) the value of a particular crypto asset may fall at any time, if, for example a new, better crypto asset is created or software developers make unexpected changes to how the crypto asset works;

(i) as crypto asset is digital currency and therefore intangible, this means that like any other digital system, crypto assets are at risk of fraud, cyberattacks, and being affected by technical problems or difficulties that could result in you losing your crypto assets or delaying or preventing your ability to access or use them; and

(j) any bond or trust account maintained by Paxos for the benefit of its customers may not be sufficient to cover all losses incurred by its customers.

For additional information regarding trading risks, please review the contents of Section 4 below.

3.2 TO THE FULLEST EXTENT PERMITTED BY LAW, PAXOS AND YOUR FINANCIAL INSTITUTION MAKE NO REPRESENTATION REGARDING THE LIKELIHOOD OR PROBABILITY THAT ANY ACTUAL OR PROPOSED TRADES ON THE EXCHANGE WILL IN FACT ACHIEVE A PARTICULAR OUTCOME OR GOAL. PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE SUCCESS, AND IN FACT VOLATILITY MEANS THAT RETURNS IN ANY PERIOD MAY BE FAR ABOVE OR BELOW THOSE OF A PREVIOUS PERIOD.

4. DISCLAIMER; RISK FACTORS

4.1 Third-Party Information.

You acknowledge and agree that, in order for Paxos to provide you access to the Exchange or the ability to buy and sell crypto assets on the Exchange, certain information must be received from your Financial Institution (“Required Information”). YOU ACKNOWLEDGE AND AGREE THAT PAXOS MAY RELY ON SUCH REQUIRED INFORMATION PROVIDED BY YOUR FINANCIAL INSTITUTION AND, UNLESS RELATED TO PAXOS’S GROSS NEGLIGENCE, WILLFUL MISCONDUCT, VIOLATION OF THE TERMS HEREIN, OR VIOLATION OF APPLICABLE LAW, PAXOS WILL NOT BE LIABLE IN ANY WAY TO YOU FOR ANY FAILURES CAUSED BY THE FAILURE BY YOUR FINANCIAL INSTITUTION TO PROVIDE THE REQUIRED INFORMATION.

4.2 No Guarantee.

We are providing you a method by which you can exchange, trade, and/or store certain crypto assets, and we make no representations or warranties concerning the value, stability, or legality of any such crypto assets. Trades offered by Users may not reflect the fair market value of the crypto asset offered. Liquidity on the Exchange may vary. Market orders may fill partly at or near fair market value and partly at a price that does not reflect fair market value. Trade with caution, and limit your trades to those that are suitable for you and your risk tolerance.

5. EXCHANGE MARKET DATA

5.1 Paxos compiles and publishes Market Data. You understand, acknowledge and agree that, due to technical and other restrictions, the crypto asset values displayed to you may be delayed and therefore not reflect the current, live market value of such crypto asset. Nonetheless, you agree that the values displayed to you control your Account and your use of the Exchange. You agree that we are not responsible for any adverse consequences that you may experience, or costs that you may incur, arising from any lapse, failure, outage, or error in receiving Market Data.

5.2 Paxos may share Market Data with its regulators. Paxos may also share (including by sale or license) Market Data with third parties, provided that such Market Data will not identify any particular User nor attribute trade(s) to a particular User by name, subject to the terms herein. Your Financial Institution may also have the same rights, as specified in this Section.

6. OPENING YOUR ACCOUNT; KNOW YOUR CUSTOMER

In order to use the Exchange, you must create an Account. Your Account will be used to store various crypto asset amounts as deposited and/or received by you.

6.1 Data Privacy.

As necessary to open your Account and to provide you access to the Exchange and Custody, you consent to the collection, use, and disclosure of your personally identifiable information in accordance with Paxos’s Privacy Policy made available to you through the App when opening your Account, the terms and conditions of which are incorporated herein by reference.

6.2 Customer Identification Program.

Paxos has developed and implemented a Customer Identification Program (“CIP”) that establishes procedures for verifying the identity of each customer that opens a new Account. It is Paxos’s policy to ensure that it has reasonably identified each customer who uses the Exchange. As such, your Financial Institution may provide certain information to us (including personally identifiable information) in order for Paxos to appropriately perform its CIP checks.

6.3 Account Opening Procedures.

Subject to the account opening process of your Financial Institution, Paxos or your Financial Institution may require that you provide certain tax information, including a W-9, W-8BEN, or W-8BEN-E prior to opening your Account. By doing so, you are confirming that the information contained therein is true, complete, and accurate. If any of the information is found not to be true, complete, and accurate, Paxos reserves the right to freeze and/or terminate your Account upon notice to your Financial Institution and/or (ii) impose backup withholding in accordance with Section 3406 of the Internal Revenue Code.

6.4 Consent to E-Delivery.

You agree that Paxos may provide you with electronic notification via the App of certain notices or information, including your Form 1099 or other tax documentation.

In the event you would like any such tax documentation to be delivered to you by any other means (e.g., via mail), you must submit a ticket to https://help.paxos.com/hc/en-us/requests/new and indicate your preferred address for receipt of such communications.

6.5 Support.

Should you have any questions or comments regarding this Agreement, the Plynk Crypto portion of the App, the Exchange, your Account, or any Paxos services and products, please reach out to our customer support team by submitting a support ticket via this link: https://help.paxos.com/hc/en-us/requests/new.

Should you have any questions, comments, or issues regarding the App or other services provided by your Financial Institution, please contact your Financial Institution directly using the method specified in the agreement between you and your Financial Institution.

7. BUYING AND SELLING CRYPTO ASSETS

7.1 Buying.

You can instruct Paxos to buy crypto assets via the Exchange using the fiat available in your Financial Institution account. If you provide such instruction, Paxos will follow the below procedure:

(a) Rates for buying crypto assets via the Exchange will be displayed in the App;

(b) You can then instruct Paxos to buy those crypto assets from a counterparty on the Exchange via the App (provided that you have sufficient fiat funds in your Financial Institution account). You acknowledge that at times, for reasons beyond Paxos’s control, we may not be able to complete a transaction. If a transaction is not completed, Paxos will provide notice to you; and

(c) Upon successful completion of the transaction, the applicable fiat currency will be withdrawn from your Financial Institution account, and Paxos will hold the purchased crypto assets for you in your Account.

7.2 Selling.

You can instruct Paxos to sell crypto assets in your Account to another User via the Exchange. If you provide such instruction, Paxos will follow the below procedure:

(a) Rates for selling crypto assets via the Exchange will be displayed in the App;

(b) You can then instruct Paxos to sell your crypto assets to a counterparty on the Exchange via the App, provided you have sufficient crypto assets in your Account. You acknowledge that at times, for reasons beyond Paxos’s control, we may not be able to complete a transaction. If a transaction is not completed, Paxos will provide notice to you; and

(c) Upon the completion of a transaction, the applicable crypto assets will be withdrawn from your Account, and Paxos will transfer the fiat currency proceeds from the sale to your Financial Institution to be held in your Financial Institution account.

(d) You understand that you cannot receive the proceeds from a sale in any other way.

7.3 Holding; No Ability to Transfer Crypto Assets.

Paxos is a limited purpose trust company chartered by the New York State Department of Financial Services. As such, we are licensed to custody crypto assets on your behalf. However, your fiat currency will continue to be held by your Financial Institution, its banking partners, or at a bank and not by Paxos. Your Account (and any available assets held in such account) is not a bank account or a deposit account. You will not be able to transfer crypto assets from your Account to any other crypto asset wallet, subject to the terms herein.

8. SUSPENSION AND TERMINATION OF YOUR ACCOUNT

8.1 Suspension and Termination.

Without limiting other remedies that may be available to us or your Financial Institution, we reserve the right, in our sole and absolute discretion, to block access to or to suspend, close, or terminate your Account, refuse to let you purchase or redeem your crypto assets, and freeze all funds or assets in your Account, at any time, upon notice to your Financial Institution, if:

(a) we believe, in our sole and absolute discretion, that you have breached any terms and conditions of this Agreement, including, but not limited to, the Marketplace Rules;

(b) you engage in abusive behavior, as determined in our sole and absolute discretion;

(d) we believe, in our sole and absolute discretion, that your actions may cause legal liability for you, our Users, or us;

(e) you add any type of currency to your Account using any source that you do not have the legal right from which to transfer funds;

(f) we have reasonable suspicion that you are directly or indirectly accessing or using the Exchange in violation of applicable law or regulation, or this Agreement;

(g) we are directed to do so by law enforcement, regulatory authority, or court order;

(h) we are required to do so by applicable law or regulation;

(i) your Account is subject to pending litigation, investigation, or governmental proceeding;

(j) we believe that someone is attempting to gain unauthorized access to your Account;

(k) we believe there is unusual activity in your Account;

(l) your Account has no crypto assets and has not been accessed in the prior year; or

(m) for any other reason in our sole and absolute discretion.

8.2 Marketplace Rules Violations.

For the avoidance of doubt, by agreeing to this Agreement, you will be bound to comply with the Marketplace Rules.

8.3 Loss of Value on Suspension or Closure.

We are not responsible for any loss of value in your Account, or of any crypto asset, resulting from the suspension or closing or your Account for any of the reasons listed above, including your violation of this Agreement or from any government seizure or forfeiture. You agree that your Financial Institution, Paxos, or any third party acting on behalf of your Financial Institution or Paxos shall not be liable to you for any termination of your access to the Exchange or your Account in accordance with this Agreement.

8.4 Account Transfer or Liquidation.

In addition to the foregoing, in the event that the relationship between your Financial Institution and Paxos terminates or expires for any reason or if Paxos is unable to provide the custody and trading services via the Exchange to Users in any specific state or jurisdiction due to changes in applicable laws or regulations, the crypto assets in your Account may be liquidated or transferred to an alternative service provider offered by your Financial Institution. In such an event, Paxos will provide you with an option to either (1) liquidate your assets in accordance with the terms of this Agreement or (2) transfer your crypto assets in Custody to such alternative service provider. If you do not timely elect either option, pursuant to the applicable notice provided on behalf of Paxos via the App and in accordance with Section 14 below, you hereby authorize Paxos to choose to liquidate or transfer your crypto assets in its sole discretion. You further agree that we will not be liable to you for any losses that you may incur as a result of a liquidation of crypto assets.

8.5 Your Obligations on Suspension or Closure.

You agree that if your access is terminated by us, you will not attempt to regain access to the Exchange or your Account – using the same or different username or other attempted identification – without our prior written consent. If we terminate your Account, we will liquidate your crypto asset holdings in your Account and return the resulting funds to your Financial Institution, less the value of any damages to which we are entitled pursuant to this Agreement, subject to applicable law. You authorize us to return your funds (less damages to which we are entitled) to your Financial Institution, unless otherwise required by law.

9. LIQUIDATION

Without limiting other remedies that many be available to us or your Financial Institution, we reserve the right in our sole and absolute discretion to debit your Account for the amount of any funding transaction that is reversed, returned or disputed for any reason, and to liquidate assets in your Account as necessary to satisfy any such debit. We may liquidate assets in any order at the prices then in effect in accordance with our standard practices. We have no obligation to maximize the value achieved in connection with any such sale.

10. SERVICE INTERRUPTION

From time to time due to technological factors, scheduled software updates and the performance of other maintenance, as well as factors beyond or within our control, the Exchange, the App or your Account may be temporarily interrupted (“Downtime”), with commercially reasonable prior notice to your Financial Institution. Information on scheduled maintenance windows can be found at https://status.paxos.com/. Open orders and/or exchanges will be held during Downtime and processed normally following Downtime. Following any Downtime, market conditions and prices may differ significantly from conditions and prices prior to such Downtime.

11. FORKS AND UNSUPPORTED ASSETS

11.1 You understand, acknowledge and agree that the underlying operating rules of certain crypto assets may change from time to time in such a way as to result in more than one related version of an existing crypto asset (each instance of any such change, a “Fork”). If a Fork occurs, it will result in the creation of a new crypto asset (the “New Forked Asset”) related to an existing crypto asset (the “Prior Asset”). As a result, we will hold an amount of the New Forked Asset proportional to our holdings of the Prior Asset. You further understand, acknowledge, and agree that each Fork may materially affect the value, function, and/or name of the original crypto asset that we custody on your behalf or you hold in your Account, and that the New Forked Asset may have minimal or no value.

11.2 WE HAVE NO CONTROL OVER, NOR DO WE HAVE THE ABILITY TO INFLUENCE, THE CREATION OR IMPLEMENTATION OF A FORK OR OF THE NEW FORKED CURRENCY. WE CAN PROVIDE NO ASSURANCES ABOUT THE SECURITY, FUNCTIONALITY, OR SUPPLY OF ANY CRYPTO ASSET, INCLUDING BOTH THE NEW FORKED ASSET AND THE PRIOR ASSET. YOU UNDERSTAND, ACKNOWLEDGE, AND AGREE THAT WE ASSUME NO LIABILITY RELATING TO ANY CHANGE IN THE VALUE OF ANY CRYPTO ASSET (WHETHER OR NOT RESULTING FROM A FORK).

11.3 If a Fork occurs, you understand, acknowledge, and agree that we may temporarily suspend the operations of the Exchange (with or without advance notice to you) while we determine, in our sole discretion, whether to support either or both of the New Forked Asset and the Prior Asset. In addition, while we will endeavor to make this determination expeditiously, we have the right to continue the suspension of the Exchange for such length of time as we deem prudent in order to make such determination. You understand, acknowledge, and agree that the Exchange is unlikely to support trading in all New Forked Assets.

11.4 You understand, acknowledge, and agree that you have no right, claim, or privilege in, or with respect to, any New Forked Asset. If we do not support a New Forked Asset, you may not be able to trade the New Forked Asset on our platform for fiat currency or other crypto assets, and you may lose any value associated with such New Forked Asset. If we determine not to support a New Forked Asset, we may, in our sole discretion, (i) obtain and retain the New Forked Asset as property belonging to us; or (ii) make the New Forked Asset available to you on a one-time basis, based on your holding of the Prior Asset at the time of the Fork, subject to the withholding and retention by us of an amount reasonably calculated to fairly compensate us for the cost of making such New Forked Asset available.

11.5 You understand, acknowledge, and agree that if you or a third party deposits an amount of a New Forked Asset (or any other crypto asset) that the Exchange does not support into our omnibus client account for crypto assets, we have the right to and will account for any such unsupported crypto asset (including unsupported New Forked Assets) as belonging to us. We have and assume no obligation or duty to return the crypto asset transmitted to one of our accounts. If we determine, in our sole and absolute discretion, to return the unsupported crypto asset, we retain the right to charge transaction and/or other fees in connection with the transfer of the unsupported crypto asset off of our platform.

12. AIRDROPS

You understand, acknowledge and agree that in the event that a third party attempts to or does distribute (sometimes called “airdropping” or “bootstrapping”) a crypto asset (whether or not supported by the Exchange) to crypto asset addresses, we will treat such airdropped crypto asset as we would treat all unsupported crypto assets, as set forth in Section 11.5 above. You further agree and understand that airdropped crypto assets do not create a relationship between us and the transferor, or sender, and/or the related network that created the airdropped crypto asset; and, further, that we are not subject to any obligation as it may relate to the transferor and/or the related network.

13. FEES

As further disclosed on the App, Paxos charges a fee or fees for your access and use of the Exchange and/or Custody, which may be included in the total price of any transaction to buy or sell crypto assets via the Exchange.

14. MARKET MAKERS

14.1 We may engage one or more market makers (each, an “MM”) to act as liquidity providers on the Exchange. You understand and agree that we may provide information concerning bids and offers placed by participants on the Exchange (including you) to such MMs prior to posting such bids and offers to the Exchange. The MMs will have the opportunity, but not the obligation, to accept and fill such bids and offers prior to the other participants on the Exchange (including you), should such bids be matched at lower prices and such offers be matched at higher prices (i.e., a more favorable bid or ask price) than they otherwise would have received had the originally proposed bids and offers been routed directly through the Exchange.

14.2 A Market Maker acting in a principal capacity may be affiliated with us (an “Affiliated MM”) and may engage in transactions on the Exchange as well as in over-the-counter transactions with Users, provided, however, that (i) Affiliated MM trading will always be designed to be revenue-neutral over the long term (i.e., we do not profit from these transactions as a whole), and (ii) no Affiliated MM will use earlier or different access to information about Exchange bids and offers from what is available to other API-integrated Users.

15. NOTICE

15.1 Notices; Delivery of Information and Documentation.

Any notice we are required to give you under this Agreement may be provided by email, postal mail, or facsimile utilizing the contact information provided by you to establish your Account.

15.2 When Notice Is Effective.

Notices shall be deemed effective upon delivery. Notices delivered by a nationally recognized overnight carrier (e.g., United States Express Mail or Federal Express) shall be deemed delivered on the business day following mailing. Notices mailed by United States Mail, postage prepaid, registered or certified with return receipt requested, shall be deemed delivered five (5) days after mailing. Notices by email and facsimile transmission, with confirmation from the transmitting machine that the transmission was completed, are acceptable under this Agreement, provided that they are deemed delivered one (1) hour after transmission if sent during the recipient’s business hours, or otherwise at 9:00 a.m. (recipient’s time) the next business day.

15.3 Refused, Unclaimed, or Undeliverable Notice.

Any correctly addressed notice that is refused, unclaimed, or undeliverable shall be deemed effective as of the first date that said notice was refused or deemed undeliverable by the postal authorities, messenger, facsimile machine, email server or service provider, or overnight delivery service.

15.4 Notices from You.

Notices from you to us shall be given by ticket submission to: https://help.paxos.com/hc/en-us/requests/new, unless otherwise specified in this Agreement.

16. INDEMNIFICATION AND RELEASE

16.1 Indemnification.

To the maximum extent permitted by applicable law, you agree to defend, indemnify, and hold harmless your Financial Institution, Paxos, its parent company, affiliates and subsidiaries, and each of their respective officers, directors, shareholders, members, partners, attorneys, employees, independent contractors, telecommunication providers, and agents (collectively, the “Indemnified Parties”), from and against any and all claims (including third-party claims), actions, loss, liabilities, expenses, costs, or demands, including, without limitation, legal and accounting fees (collectively, “Losses”), directly or indirectly, resulting from or by reason of (i) your (or you under another person’s authority) use, misuse, or inability to use your Account or the Exchange; (ii) any regulatory inquiry, legal action, litigation, dispute, or investigation related to your Account and to your use of your Account or the Exchange; or (iii) your breach of this Agreement.

Paxos shall notify you by electronic mail, postal mail, or other appropriate means of any such claim or suit, and reasonably cooperate (at your expense) in the defense of such claim or suit. We reserve the right to participate in the defense of any such claim or choose our own legal counsel but are not obligated to do so.

16.2 Release.

To the maximum extent permitted by applicable law, you hereby discharge, acquit, and otherwise release the Indemnified Parties from any and all allegations, counts, charges, debts, causes of action, claims, and Losses, relating in any way to the use of the Exchange or Custody, including, but not limited to, claims relating to the following: negligence, intentional interference with contract or advantageous business relationship, defamation, privacy, publicity, misrepresentation, any financial loss not due to the fault of Paxos, false identities, fraudulent acts by others, invasion of privacy, release or misuse of personal information, failed transactions, unavailability of the Exchange or your Account and any other technical failure that may result in inaccessibility to the Exchange or your Account, or any claim based on vicarious liability for torts committed by Users encountered or transacted with or through the Exchange, including, but not limited to, fraud, computer hacking, theft or misuse of personal information, assault, battery, stalking, rape, cheating, perjury, manslaughter, or murder.

The above list is intended to be illustrative only, and not exhaustive of the types or categories of claims released by you. This release is intended by the parties to be interpreted broadly in favor of Paxos and your Financial Institution, and thus any ambiguity shall be interpreted in a manner providing release of the broadest claims. This release is intended to be a full release of claims, and the parties acknowledge the legally binding nature of this provision, and the nature of the rights given up in connection therewith.

If you are a California resident, you hereby waive California Civil Code Section 1542, which states:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”

If you are a resident of another jurisdiction with a comparable statute or doctrine, you hereby waive such statute or doctrine to the extent permissible under applicable law.

17. LIMITATION OF LIABILITY

17.1 Limitation of Liability.

Except to the extent prohibited by applicable laws, in no event shall your Financial Institution or Paxos (or their respective licensors, agents, suppliers, resellers, service providers, or any other subscribers or suppliers) be liable to you, or any other third party, for any direct, special, indirect, incidental, consequential, exemplary, or punitive damages, including without limitation, damages for loss of profits, loss of information, business interruption, loss of revenue, or loss of goodwill, which may arise from any person’s use, misuse, or inability to access or use your Account or the Exchange, including any loss caused in whole or in part by any inaccuracies, incompleteness or delays, or interruptions in your Account or the Exchange, even if we have been advised of the probability of such damages and regardless of whether such liability is asserted on the basis of contract, tort or otherwise.

17.2 Third-Party Disputes.

TO THE FULLEST EXTENT PERMITTED BY LAW, ANY DISPUTE YOU HAVE WITH ANY THIRD PARTY ARISING OUT OF YOUR USE OF THE EXCHANGE, INCLUDING, BY WAY OF EXAMPLE AND NOT LIMITATION, YOUR FINANCIAL INSTITUTION, OR ANY OTHER THIRD PARTY, IS DIRECTLY BETWEEN YOU AND SUCH THIRD PARTY, AND YOU IRREVOCABLY RELEASE PAXOS AND YOUR FINANCIAL INSTITUTION (WHERE APPLICABLE) FROM ANY AND ALL CLAIMS, DEMANDS, AND DAMAGES (ACTUAL AND CONSEQUENTIAL) OF EVERY KIND AND NATURE, KNOWN AND UNKNOWN, ARISING OUT OF OR IN ANY WAY CONNECTED WITH SUCH DISPUTES.

17.3 Force Majeure.

We, your Financial Institution, and any bank where our deposit accounts are held will not be liable for our failure to perform any obligations under this Agreement due to events beyond our control, and the time provided for performing such obligations shall be extended by a period of time equal to the duration of such events. Events beyond our control include, but are not limited to, acts of God, war, riot, arson, embargoes, civil commotion, strikes, labor disputes, equipment failures, bank failures, crypto asset market collapse or fluctuations, fiat currency conversion rate fluctuations, fire, flood, earthquake, hurricanes, tropical storms or other natural disaster or casualty, shortages of labor or material, shortage of transportation, facilities, fuel, energy, pandemic, government regulation or restriction, acts of civil or military authority or terrorism, fiber cuts, weather conditions, breaches or failures to perform by third parties, technical problems, including hardware and software crashes and other malfunctions, failure of the telecommunications or information services infrastructure, hacking, SPAM or failure of any computer, server or software disruptions on account of or caused by vandalism, theft, phone service outages, power outage, internet disruptions, viruses, and mechanical, power, or communications failures.

If any law, regulation, rule, regulation or decision of any self-regulatory organization, or ordinance, whether international, federal, state, or local, becomes effective which substantially alters our ability to offer the services hereunder, we shall have the right to cancel this Agreement, with notice, if reasonably possible, effective upon the earlier of (i) the date upon which we are unable to provide access to the Exchange or your Account; or (ii) thirty (30) days following notice.

17.4 Maximum Liability.

In no event shall our maximum total aggregate liability hereunder for direct damages exceed the total fees actually paid by you for use of the Exchange for a period of more than three (3) months from the accrual of the applicable cause or causes of action. Because some jurisdictions prohibit the exclusion or limitation of liability for consequential or incidental damages, the above limitation may not apply to you (in whole or in part).

17.5 Right of Set-Off.

To the extent allowable by law, we reserve the right to set off any damages or amounts owed to us by you for your breach of this Agreement, your indemnification obligations, or for your other obligations under this Agreement against funds in your Account (including, without limitation, transaction fees, funds transfer fees, and dormancy fees).

18. CONFIDENTIALITY AND COMPLIANCE WITH LEGAL PROCESS

18.1 Permitted Disclosure.

We may share information concerning you and your Account:

(a) with our banks, your Financial Institution, and other financial institutions that we use or may use to process funds in connection with your Account or the Exchange;

(b) with law enforcement, regulatory authorities, tax authorities (including the U.S. Internal Revenue Service pursuant to the Foreign Account Tax Compliance Act, to the extent this applies), self-regulatory organizations (such as those that operate crypto asset derivative exchanges) and officials, or other third parties when we are compelled to do so by a subpoena, court order, or similar legal procedure, or when we believe in good faith that the disclosure of your information is necessary to prevent physical harm or financial loss, to report suspected illegal activity or to investigate violations of this Agreement or any other applicable policies;

(c) with third parties, such as vendors, agents, contractors, and our advisors (e.g., legal, financial, business, or other advisors) in order to administer our services, including to verify your identity and conduct screening and due diligence checks;

(d) in connection with a merger, acquisition, or otherwise as set forth in Section 21.1; or

(e) as permitted or required by applicable law.

Please refer to our Privacy Policy for more information on the use of your personal information.

18.2 Legal Process.

You agree and understand that we may comply with any writ of attachment, execution, garnishment, tax levy, restraining order, subpoena, warrant, or other legal process that we in good faith believe to be valid. We may, but are not required to, notify you of such process. We may charge you for associated costs, including attorneys’ fees. You agree that we may honor any legal process, regardless of the method or location of service.

19. ARBITRATION; STATUTE OF LIMITATIONS

19.1 Arbitration.

If a dispute arises between the parties arising out of or otherwise relating to this Agreement, the parties shall meet and negotiate in good faith to attempt to resolve the dispute. If the parties are unable to resolve the dispute through direct negotiations, then, except as otherwise provided herein, either party must submit the issue to binding arbitration in accordance with the applicable arbitration ordinance. Claims subject to arbitration shall include, but are not limited to, contract and tort claims of all kinds, and all claims based on any federal, state, or local law, statute, or regulation, excepting only claims by us under applicable worker’s compensation law, unemployment insurance claims, along with actions (regardless of the underlying cause of action) by us seeking injunctions, attachment, garnishment, and other equitable relief. You agree to arbitrate solely on an individual basis and understand, acknowledge, and agree that this Agreement does not permit class arbitration or any claims of any type brought as a plaintiff or class member in any class or representative arbitration proceeding.

Any dispute arising out of or relating to this Agreement, or the breach thereof, shall be finally settled on an individual basis by arbitration in New York, New York, administered by the American Arbitration Association in accordance with its Consumer Arbitration Rules. The language of the arbitration shall be English, and the Agreement shall be governed by the laws of the State of New York.

An arbitral decision resulting from the above may be enforced in any court, and a prevailing party in any action or proceeding to enforce this Agreement shall be entitled to costs and attorney’s fees.

The Arbitrator shall have no authority to award any punitive or exemplary damages, certify a class action (or join the claims of one party with any other party), add any parties, or vary or ignore the provisions of this Agreement. The arbitrator shall render a written opinion setting forth all material facts and the basis of his or her decision within thirty (30) days of the conclusion of the arbitration proceeding.

If for any reason this arbitration clause is not applicable or litigation proceeds in court, then you agree that:

You may bring claims against Paxos only in your individual capacity and not as a plaintiff or class member in any purported class or representative action; and

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAWS AND REGULATIONS, YOU HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER MATTER INVOLVING US ARISING OUT OF THE EXCHANGE OR YOUR ACCOUNT.

19.2 No Waiver of Right to Arbitration.

There shall be no waiver of the right to arbitration unless such waiver is provided affirmatively and in writing by the waiving party to the other party. There shall be no implied waiver of this right to arbitration. No acts, including the filing of litigation, shall be construed as a waiver or a repudiation of the right to arbitrate.

19.3 Waiver of Statute of Limitations.

Notwithstanding the period of limitation prescribed by applicable laws for the bringing of any relevant action or claim, the Parties hereby mutually agree that no action, regardless of form, arising out of or in conjunction with the subject matter of this Agreement, except for claims involving intellectual property, claims to recover outstanding amounts due to us, and claims for indemnification, may be brought by any party more than one (1) year after the cause of action arose, following which either party shall have no further claim whatsoever against the other party.

19.4 Right to Injunctive Relief.

You agree that due to the nature of our business, monetary damages for a breach of your obligations under this Agreement would be inadequate to compensate us. Accordingly, you agree and understand that any violation or threatened violation by you of your obligations under this Agreement will cause irreparable injury to us and that, in addition to any other remedies that may be available, in law, in equity, or otherwise, we will be entitled to obtain injunctive relief against any threatened breach of this Agreement or the continuation of such breach without the necessity of proving actual damages.

20. COMPLAINTS

If you would like to contact us with a complaint, please contact Customer Support using one of the following methods:

Submit a support ticket to https://help.paxos.com/hc/en-us/requests/new.

Write to Customer Support at:

Paxos
450 Lexington Ave, Suite 3952
New York, NY 10163

You may also direct your complaint to the attention of: New York State Department of Financial Services, One State Street, New York, NY 10004-1511; +1 (212) 480-6400. Please visit www.dfs.ny.gov for additional information.

If you are a customer of Paxos Trust Company in the State of Texas, you may also direct your complaint to the attention of: Texas Department of Banking, 2601 North Lamar Boulevard, Austin, TX 78705; +1 (877) 276-5554. Please visit dob.texas.gov for additional information.

21. MISCELLANEOUS PROVISIONS

21.1 Assignment.

Neither this Agreement nor any of your rights and obligations hereunder may be transferred by you, but may be assigned by us without restriction. Any attempted transfer or assignment by you in violation hereof shall be null and void. This Agreement shall be binding and inure to the benefit of the parties hereto, our successors, and permitted assigns.

In the event that we are acquired by or merged with a third-party entity, or your Account is otherwise assigned, we reserve the right, in any of these circumstances, to transfer or assign the information we have collected from you as part of such assignment, merger, acquisition, sale, or other change of control. See also our Privacy Policy for additional information.

21.2 Severability.

If for any reason a court of competent jurisdiction or an arbitrator finds any provision of this Agreement, or any portion thereof, to be invalid, unenforceable, or illegal, such invalidity, unenforceability, or illegality shall not affect the remainder of this Agreement, which will continue to be in full force and effect, and any prior, effective provision of the Agreement that was superseded by such invalid, unenforceable, or illegal provision shall be deemed valid and enforceable to the fullest extent.

21.3 Amendment; Modification.

We may amend or modify this Agreement at any time by posting the revised agreement on the App (a “Revised Agreement”). Your continued use of the Exchange shall be deemed acceptance of the Revised Agreement. You agree that all modifications or changes to this Agreement are in force and enforceable immediately upon posting the Revised Agreement on the App. The Revised Agreement supersedes any prior versions immediately upon posting, and the prior version is of no continuing legal effect unless the Revised Agreement specifically refers to the prior version and explicitly states that the prior version (or portions thereof) will remain in effect. If you do not wish to be bound by the Revised Agreement, your sole and exclusive remedy is to terminate your use of the Exchange and close your Account.

21.4 No Waiver.

No waiver or action made by us shall be deemed a waiver of any subsequent default of the same provision of this Agreement. No failure or delay in exercising or enforcing any privilege, right, remedy, or power hereunder shall be deemed a waiver of such provision by us. All waivers must be in writing.

21.5 Headings.

All headings are solely for the convenience of reference and shall not affect the meaning, construction, or effect of this Agreement.

21.6 Complete Agreement.

This Agreement constitutes the entire agreement between Paxos and you with respect to your access and use of your Account, the Exchange, or Custody. This Agreement, together with our Privacy Policy, supersedes and replaces all prior understandings or agreements, written or oral, regarding such subject matter.

21.7 Other Jurisdictions.

We make no representation that your Account or the Exchange are appropriate or available for use in other locations, and access to them from territories where their content or function may be illegal or is otherwise prohibited.

21.8 Survival.

All provisions of this Agreement which by their nature extend beyond the expiration or termination of this Agreement, including, without limitation, sections pertaining to suspension or termination, debts owed, general use of the Exchange, disputes with us, and general provisions, shall survive the termination or expiration of this Agreement.

EXHIBIT A – MARKETPLACE RULES APPENDIX

You agree to abide by the following (“Marketplace Rules”):

General Fraudulent Acts. You shall not engage in any fraudulent act or engage or attempt to engage in any scheme to defraud, deceive, or trick users of the Exchange, employees of the Exchange, or the underlying software of the Exchange.

Fictitious Transactions. You shall not place an order without an intention to execute.

Market Manipulation. You shall not engage in any disruptive trading or manipulation of the Exchange. This includes orders placed for the purpose of generating volatility or creating a condition in which prices do not or will not reflect bona fide supply and demand.

Violation of Applicable Laws and Regulations. You shall not use the Exchange in a way that violates the laws and regulations applicable to Paxos and the Exchange.

Misstatements. You shall not make any misstatement of material fact to Paxos.

Activities That Bring Disrepute upon Paxos. You shall not use the Exchange or any Services provided in connection therewith in any way that could be expected to bring disrepute upon Paxos.

Disclosing Trades. You shall not place any order on the Exchange that has been pre-arranged (or discussed with another user of the Exchange prior to being placed on the Exchange), or disclose any order that you have placed on the exchange, for the purpose of creating an artificial price, fictitious trade, or other disruptive, fraudulent, noncompetitive, or unfair impact on the Exchange or on any other third party crypto exchange.

Wash Trades. You, through one or more accounts owned by you or any related party, shall not place or accept buy and sell orders at the same price, where you or any related party know that the purpose of the orders is to artificially create the appearance of activity (transactions commonly known as “wash trades”).

Money Passes. You shall not prearrange the execution of transactions on the Exchange for the purpose of passing money between accounts.

Accommodation Trading. You shall not enter into transactions on the Exchange for the purpose of assisting another person to engage in transactions that are in violation of this Marketplace Rules Appendix or any applicable laws and regulations.

Front Running. You shall not take a position based upon non-public information regarding an impending transaction by another User.

Disruptive Practices. You shall not engage in any trading, practice, or conduct on the Exchange that: (i) demonstrates intentional or reckless disregard for the orderly execution of transactions or (ii) involves spoofing (bidding or offering with the intent to cancel the bid or offer before execution).

You shall not engage in any conduct that threatens, harasses, coerces, intimidates, or otherwise attempts to improperly influence another User or any other person.

MARKETPLACE RULES VIOLATIONS

If we suspect that you have violated our Marketplace Rules, we will give you and your Financial Institution written notice of such suspected violation, including the general nature of the activity observed. You will have the right to submit, within ten (10) calendar days from the date of notification, a written explanation to us as to why no disciplinary action should be taken. You agree and understand that you are obligated to respond in writing to any queries from us within the time period for response set forth herein and to furnish documents and other information in connection with any investigation initiated under this Marketplace Rules Appendix or the Agreement. Following the conclusion of the investigation, we will make a determination, in our sole discretion, as to whether your conduct violated our Marketplace Rules. If we determine that you have violated our Marketplace Rules, in addition to terminating your Account, we may notify our regulators, self-regulatory organizations, and law enforcement of the activity, including your identity where required or otherwise permitted by law, and you agree to the same.