SuperStrat Risk Disclosure

Version 1.1.0 Date of last revision: 2026-09-02 Effective from: publication on the Interface

This Risk Disclosure is an integral part of the SuperStrat Terms of Use (the "Terms") and is incorporated into them by reference (Terms, Section 1.3). Capitalized terms have the meanings given in the Terms. By accepting the Terms, you acknowledge that you have read, understood and accepted the risks described below.

This list is not exhaustive. New or unknown risks may exist. Deposit only what you can afford to lose entirely.

0. The Five Ways You Can Lose Everything

Read this first. The rest of this document expands on it.

(a) The Curator can lose or take the money. Assets allocated for trading leave the Vault contract and sit in a trading account the Curator controls. Nothing in the code prevents the Curator from losing them, mismanaging them or taking them.

(b) The admin key can empty the Vault. When a Vault is paused, the holder of its admin role can withdraw the entire balance of the Vault contract, including the assets behind pending deposit and redemption requests, to the admin address and terminate the Vault. The circumstances, time limits and publication and redistribution obligations attached to that power are set out in the Emergency Powers Policy; the code itself does not enforce them.

(c) The bets can simply lose. Event contracts routinely go to zero at resolution. A single resolution can move a Vault's value by a large amount in one step.

(d) You cannot get out on demand, and there is no forced exit. Redemptions settle at the end of an Epoch, on no guaranteed schedule, and only if the Curator settles. If no settlement occurs for seven days, you may cancel a pending, unsettled request and recover what that request holds in the Vault contract. Nothing gives you access to assets held in the Curator's trading account.

(e) The valuation is an estimate proposed by software. It is not bounded by the previous value, and it determines the price at which you enter and exit.

1. Total Loss Risk

Depositing into a Vault can result in the loss of your entire deposit. No return is guaranteed, no loss is reimbursed, and no government scheme, deposit insurance or investor compensation mechanism applies. Vault Shares are not bank deposits and are not obligations of the Operator.

2. Prediction Market Risk

Vault assets are traded on Prediction Market Venues (currently Polymarket), which involve risks that differ from, and can exceed, those of traditional markets:

• Binary outcomes. Event contracts can lose most or all of their value at resolution. A single resolved market can cause a large, sudden change in a Vault's value.
• Resolution risk. Market outcomes are determined by the venue's resolution process (including third-party oracle systems). Resolutions can be delayed, disputed, or, in your view or in fact, wrong. A Vault has no recourse against an unfavourable resolution.
• Liquidity and slippage. Prediction markets can be thin. Positions may be impossible to exit at quoted prices, or at all, before resolution. Liquidating large positions can move prices materially.
• Venue risk. The venue may suspend markets, freeze accounts, change its rules, be subject to regulatory action, or fail entirely.
• Legal status. In a large number of countries, prediction markets and event contracts are treated by the competent authorities as unlicensed gambling, and access to the principal venues has been ordered blocked. Section 3 of this document sets out the position as at the date of this version. Exposure to prediction markets may be unlawful for you personally.

3. Legal Status of Prediction Markets

This Section states facts as at 2026-09-02. They change quickly and are re-verified at each version of this document and at each review of the Restricted Jurisdictions Policy.

(a) France. The president of the Autorité nationale des jeux ordered French internet service providers to block access to the principal Prediction Market Venue on 2026-07-16, on the ground that the site promoted an unauthorised gambling offer. The block is effective. Under French law, holding out or promoting an unauthorised gambling offer is a criminal offence.

(b) Elsewhere in Europe. Access to the principal Prediction Market Venue has been blocked, or an enforcement action published, in Spain (blocking order of 2026-05-26 against both principal venues), the Netherlands (order to block Dutch users under a periodic penalty), Belgium, Germany, Poland, Portugal (enforcement action of January 2026), Romania, Hungary, Switzerland, Italy (blacklisted, access blocked from 2026-07-27) and the Czech Republic (listed as an unauthorised internet game on 2026-07-13). In Great Britain, the Gambling Commission has stated that prediction markets are betting requiring a licence; the principal venue holds no such licence and permits Great Britain users only to close positions.

(c) Outside Europe. Singapore has treated the principal venue as an unlicensed remote gambling service and has blocked access since January 2025. South Korea blocked access in August 2026 following a regulatory ruling that the venue offers illegal gambling.

(d) Coordinated supervision. In 2026, gambling regulators from Belgium, France, Germany, Italy, the Netherlands, Poland, Portugal, Spain and Switzerland announced enhanced cross-border cooperation against unlicensed prediction market platforms. The pattern of enforcement is directed at operators and at persons who promote or collect funds for such offers, not only at individual users.

(e) What this means for you. You may not access the Interface from any country listed in the Restricted Jurisdictions Policy, and the Interface refuses access from those countries. Exposure to prediction markets may be unlawful for you personally even where the Interface is technically reachable. Neither the Operator nor any Curator can make it lawful for you.

(f) What this means for the Protocol. Regulatory action against a Prediction Market Venue can freeze or impair Vault positions without warning and without recourse, whether or not the Vault or its Curator did anything wrong.

(g) Trading for the account of third parties. A Prediction Market Venue may, under its own terms, restrict or prohibit trading on behalf of other persons or with funds belonging to other persons. A Curator trades pooled Vault assets on a venue account opened in the Curator's own name. The venue may treat that activity as a breach of its terms and may freeze, restrict or close the Curator's account, with the loss falling on the Vault and its depositors. The Operator has no ability to prevent or reverse such a measure.

4. Curator Risk

Each Vault is operated by an independent Curator whose decisions determine the Vault's performance:

• Curators may make poor decisions, take excessive risk, act negligently, or attempt misconduct.
• Trading operates on a disclosed trust model. Assets a Vault allocates for trading are transferred to a trading account controlled by the Curator. Protocol safeguards (including a liquidity floor on trading allocations and role restrictions) limit some operations, but they do not technically prevent a Curator from losing, mismanaging or misappropriating allocated assets.
• The Operator verifies the identity of each Curator before the Curator's first Vault is deployed (Curator Terms, Section 1.4) and applies the Curator Due Diligence Policy. That verification is not an endorsement, an audit, a suitability assessment or a view on any Curator's strategy, honesty or skill. Information Curators publish about themselves (profiles, track records, strategies) is not verified by the Operator and may be false or misleading.
• Past performance of a Curator or Vault does not predict future results.
• A Curator may stop operating a Vault, become unreachable, or lose access to their keys, which can delay or impair settlements and redemptions.
• The Curator's stake in their own Vault (Curator Terms, Section 7.2) is partial security only. It may be far smaller than the loss it is meant to cover, and it is exposed to the same risks as your deposit.

5. Valuation and Settlement Risk

• Deposits and redemptions settle at a net asset value proposed through the Protocol's valuation process. Valuation of open prediction market positions is inherently uncertain; the proposed value is an estimate and may differ materially from realizable value.
• If a valuation is too high or too low, depositors entering, exiting or remaining in the Vault may be advantaged or disadvantaged relative to one another. Settlements are final once executed by the Protocol.
• The valuation process depends on an oracle role (by default, the Valuation Service operated by the Operator). It may fail, be delayed, use inaccurate market data, or propose erroneous values.
• The Protocol does not bound proposed values. A proposed net asset value is not limited by reference to the previous value; the only technical ceiling is an absolute anti-overflow bound far above any realistic value. The oracle's proposal must be validated by the Curator at settlement. Where a Vault's curator and oracle roles are held by the same person, a single key both proposes and validates the value applied to settlements; such a Vault is labelled RESTRICTED on the Interface (Terms, Section 4.2).
• No representation is made that Vault Shares will trade, or be redeemable, at, near or within any specified range of a Vault's stated net asset value. Deviations may arise from illiquidity in the underlying positions, delays in valuation, oracle latency, market sentiment, arbitrage friction, regulatory events, smart contract issues, or the financial condition of the Curator.

6. Liquidity and Lock-up Risk

• Vaults use asynchronous (Epoch-based) deposits and redemptions. You cannot withdraw instantly. Redemption requests are queued and settle only at the end of an Epoch, after which claimed amounts become available.
• There is no forced redemption and no guaranteed settlement schedule. Settlement occurs only when the Curator settles. The Protocol contains no function by which a depositor can compel a settlement or force the release of settled assets or of assets held in the Curator's trading account.
• If no settlement has occurred for seven consecutive days, the Protocol allows you to cancel a pending, unsettled request. Cancellation returns only what that request holds in the Vault contract: the Deposit Asset behind a pending deposit, or the locked Vault Shares behind a pending redemption. It does not convert Vault Shares into the Deposit Asset and does not reach assets in the trading account.
• The Curator's undertaking to settle at least once every 30 days (Curator Terms, Section 3.5) is a contractual promise made by the Curator. It is not enforced by the code, and the Operator does not guarantee its performance.
• A Vault's liquidity reserve is an operational buffer, not a guarantee that redemptions can be met at any given time.

7. Smart Contract and Technology Risk

• Smart contracts may contain bugs or vulnerabilities. Exploits can cause partial or total loss of Vault assets. The Protocol has previously experienced an exploit on a prior version (funds were fully recovered and the code was rewritten and reviewed as described in Section 15); reviews and audits reduce but do not eliminate risk.
• Blockchain transactions are irreversible. Errors in addresses, parameters or approvals can cause permanent loss.
• The Interface, RPC providers, wallets and other infrastructure can fail, be compromised, or display inaccurate data. The blockchain state prevails over anything displayed on the Interface.
• Upgrades, migrations or parameter changes to the Protocol or its supported contracts can introduce new risks.

8. Asset and Network Risk

• Stablecoin risk. Deposits are denominated in USDC.e, a bridged stablecoin. It can de-peg from the US dollar, and its issuer or the bridge securing it can fail, be exploited, or freeze assets. A USDC.e failure would directly impair Vault values regardless of trading performance.
• Network risk. The Protocol runs on Polygon PoS. Network congestion, outages, reorganizations, validator failures, forks or protocol changes can delay or corrupt transactions and settlements.
• Wallet and key risk. Loss or theft of your private keys or seed phrase means permanent loss of your assets. Any transaction signed with your keys is attributable to you, even if fraudulent. No one can restore your access.

9. Regulatory and Legal Risk

• The legal treatment of Crypto-Assets, decentralized finance protocols, vault structures and prediction markets is evolving and varies by jurisdiction. New laws, regulations or enforcement actions could adversely affect the Protocol, the Interface, the Operator, Curators, Prediction Market Venues or you, up to and including forced discontinuation of some or all services. The Operator may suspend, restrict or geoblock access at any time under Section 3.9 of the Terms.
• You may not benefit from the legal protections available in traditional, regulated financial markets, including conduct-of-business rules, segregation requirements, complaint schemes and compensation funds.
• Tax treatment of deposits, redemptions, fees and rewards is uncertain in many jurisdictions and is your sole responsibility.

10. Interface and Operational Risk

• The Interface may be unavailable, contain errors, or be modified, suspended or discontinued at any time. Interface unavailability does not suspend the Protocol, but it can prevent you from conveniently submitting requests or claims.
• The Operator restricts access from Restricted Jurisdictions by deriving a country from your IP address at the edge of its hosting infrastructure and refusing wallet connection, acceptance of the Terms and every gated action from restricted countries. The Operator keeps records of those determinations, including your wallet address where connected, for the period stated in the Privacy Policy. Geolocation can be wrong; a wrong determination can deny you access without the Operator's knowledge, and the Operator has no obligation to correct it.
• Data displayed on the Interface (values, performance, points, leaderboards) may be delayed, estimated or wrong.

11. Points and Program Risk

Points, leaderboards and similar program features have no monetary value, confer no rights and may be changed, re-calculated or cancelled at any time. Do not attribute financial value to them and do not make deposit decisions in expectation of any token, airdrop or reward. None is promised.

12. Centralization and Administrative Power Risk

The Protocol follows a trusted-operators design. Certain roles hold significant powers:

• Emergency withdrawal. Each Vault has an emergency administrative function which, when the Vault is paused, allows the holder of the Vault's admin role to withdraw the Vault's entire asset balance (including assets underlying pending deposit and redemption requests) to the admin address and terminate the Vault. This function exists for incident response. The Emergency Powers Policy states the circumstances in which it may be exercised, the maximum period a Vault may remain paused, the publication obligations that follow, the destination of withdrawn assets and the redistribution procedure. Those obligations bind the admin contractually; the code does not enforce them. Misuse of the function, or the compromise or phishing of an admin key, would result in loss of Vault assets. The admin role is held by the Vault's Curator or, for certain Vaults, by the Operator, as stated on the Vault Sheet.
• Role concentration. A Vault may be configured with the same person holding the curator and oracle roles, so that a single key both proposes and validates the net asset value. Such a Vault is labelled RESTRICTED on the Interface, is subject to the reduced cap stated on its Vault Sheet, and is not promoted on the Interface (Terms, Section 4.2). Vaults open to third-party deposits are required by the Curator Terms to separate those roles.
• Factory and pause controls. The Operator operates a technical eligibility screening determining which Curators may create Vaults, applied against the Curator Due Diligence Policy, and may hold pause or other administrative functions intended for security and operations.
• Key compromise. Compromise of any privileged key (admin, curator, oracle, trading account) can result in partial or total loss of the affected Vault's assets.

13. Counterparty Risk in Respect of the Operator

The Operator is a company in formation, to be incorporated under the laws of the British Virgin Islands, with limited assets. Its liability to you is contractually capped at the amounts stated in Section 13 of the Terms, including a per-user cap and an aggregate cap for all claims arising out of the same event. It holds no regulatory capital, is covered by no compensation scheme, and may cease operations at any time. If the Operator becomes insolvent or ceases operations, the Interface will stop being maintained; assets in Vault contracts remain governed by their code and may be reachable by direct on-chain interaction, but no one will be obliged to help you reach them.

14. Conflicts of Interest

• The Operator receives a share of Vault performance fees and therefore benefits from deposit volume and Vault performance.
• The Operator operates the default Valuation Service and may hold administrative roles described in Section 12.
• Curators earn performance fees and may deposit into their own Vaults, including the stake required by the Curator Terms.
• The Operator or its Affiliates may operate Vaults; such Vaults are identified as such on the Interface and on their Vault Sheet.

These interests are disclosed so that you can take them into account; they do not create any duty of the Operator to act in your interest.

15. Independent Assessment

An internal, AI-assisted security review of the current Protocol version was completed on 2026-06-23, and a third-party security audit was received and triaged on 2026-07-27. Findings from both were reproduced by tests, and the deployed bytecode was verified against the audited source. Those reports are not published at the date of this version. No independent risk assessment of the product, as distinct from the security of its code, has been published. A security review addresses code defects; it does not address Curator conduct, valuation accuracy, venue risk or the legal status of prediction markets.

16. No Advice; Personal Responsibility

Nothing on the Interface is investment, legal, tax or accounting advice, or a recommendation to deposit into any Vault. Conduct your own research, verify all information independently, and consult qualified professional advisers before acting. You alone are responsible for your decisions.

SuperStrat Risk Disclosure, Version 1.1.0. The authoritative version of this document and its cryptographic hash are published at superstrat.io/risk-disclosure.