Certain Risks Relating to Purchase, Sale and Use of FREM NFTs

By purchasing, holding and using the FREM NFTs, the Purchaser expressly acknowledges that it understands and assumes a variety of risks (including without limitation the following risks):

Key definitions:

“Group Entity” refers to any subsidiaries or related companies within the same group of companies as the Company.

“Company” refers to Ekta Real Estate Entity

“Platform” refers to the platform operated by [Ekta Real Estate Entity], entitled, Ekta Real Estate

“Virtual Asset” refers to the FREM NFTs

“Virtual Asset Documentation” refers to the terms and conditions for the Platform available on the Platform’s website.


  1. Risk of changes in functionality

The Virtual Asset does not have any rights, uses, purpose, attributes, functionalities or features, express or implied, except for those which are specifically described in the Virtual Asset Documentation, and which may change from time to time.

  1. Risks Associated with the related Blockchain and underlying protocol

Because the Virtual Asset and the Platform are based on blockchain technology, any malfunction, breakdown, or abandonment of the relevant blockchain may have a material adverse effect on the Platform and/or the Virtual Asset. Moreover, advances in cryptography, or technical advances such as the development of quantum computing, could present risks to the Virtual Asset and the Platform by rendering ineffective the cryptographic consensus mechanism that underpins the relevant blockchain. The future of cryptography and security innovations is highly unpredictable.

Further, products or services available on the Platform may require digital assets provided by a user to be deposited with, “staked” with and/or otherwise require interaction with various third-party decentralised finance protocols which primarily comprise smart contracts deployed on the relevant blockchain. These third-party decentralised finance protocols and the development team behind these protocols are independent third parties, so the Company and its Group Entities have no control over these protocols or teams. These deployed smart contracts underlying the decentralised finance protocols may contain security vulnerabilities, errors, failures, bugs or economic loopholes, which may be exploited by third parties, causing you to suffer losses in connection with any product(s) available on the Platform. Neither the Company nor any Group Entity can be responsible for any such security vulnerabilities, errors, failures, bugs or economic loopholes.

  1. Risk of Losing Access to the Virtual Asset Due to Loss of Private Key(s)

A private key, or a combination of private keys, is necessary to control and dispose of the Virtual Asset stored in the Purchaser’s digital wallet, vault or other storage mechanism. Accordingly, loss of requisite private key(s) associated with the Purchaser’s digital wallet, vault or other storage mechanism storing the Virtual Asset may result in loss of such Virtual Asset. Moreover, any third party that gains access to such private key(s), including by gaining access to login credentials of a hosted wallet service used by the Purchaser, may be able to misappropriate any Virtual Asset held by the Purchaser. The Company cannot be responsible for any such losses.

  1. Risk of Blockchain Level Attacks

As with other decentralised cryptographic tokens based on blockchain technology, the Virtual Asset is susceptible to attacks by nodes or validators responsible for validating/confirming Virtual Asset transactions on the relevant blockchain, including, but not limited, to double-spend attacks, majority mining power attacks, and selfish-mining attacks. Any successful attacks present a risk to the Platform and Virtual Asset, including, but not limited to, accurate execution and recording of transactions involving the Virtual Asset.

  1. Risk of Hacking and Security Weaknesses

Hackers or other malicious groups or organisations may attempt to interfere with the Platform or Virtual Asset in a variety of ways, including, but not limited to, malware attacks, denial of service attacks, consensus-based attacks, Sybil attacks, smurfing and spoofing. Furthermore, because the Platform is based on open-source software, there is a risk that a third party or a member of any Group Entity may intentionally or unintentionally introduce weaknesses into the core infrastructure of the Platform, which could negatively affect the Platform and the Virtual Asset.

  1. Risk of Uninsured Losses

Unlike in the case of bank accounts or accounts at financial institutions, the Virtual Asset is uninsured unless the Purchaser specifically obtains private insurance to insure it. Thus, in the event of loss or loss of utility value, there is no public insurer or private insurance arranged by any Group Entity to provide recourse (and in any event, the Company is not obliged to compensate or insure the Purchaser for any event of loss or loss of utility value).

  1. Risks Associated with Uncertain Regulations and Enforcement Actions

The regulatory status of the Virtual Asset and distributed ledger technology is unclear or unsettled in many jurisdictions, but numerous regulatory authorities across jurisdictions have been outspoken about considering the implementation of regulatory regimes which govern digital asset markets. It is difficult to predict how or whether regulatory agencies may apply existing regulation with respect to such technology and its applications, including the Platform and Virtual Asset. It is likewise difficult to predict how or whether legislatures or regulatory agencies may implement changes to law and regulation affecting distributed ledger technology and its applications, including the Platform and Virtual Asset. Regulatory actions could negatively impact the Platform and Virtual Asset in various ways, including, for purposes of illustration only, through a determination that the Virtual Asset is a regulated financial instrument that requires registration or licensing, the Platform may not be able to provide regular service in certain areas. Any Group Entity may cease operations in a jurisdiction, or even abandon certain features of the project, in the event that regulatory actions, or changes to applicable law or regulation, make it illegal to operate in such jurisdiction, or commercially undesirable to obtain the necessary regulatory approval(s) to operate in such jurisdiction.

  1. Risks Arising from Taxation

The tax characterisation of the Virtual Asset and this Agreement is uncertain. The Company intends to treat the Virtual Asset and this Agreement neither as an equity interest nor as a debt interest in the Company for tax purposes. It is possible that the Company’s intended treatment of the Virtual Asset and this Agreement may be challenged, so that the tax consequences to the Purchaser and the Company relating to the Virtual Asset and this Risk Disclosure Statement could differ from those described above. The Purchaser must seek its own tax advice in connection with purchasing, holding and utilising the Virtual Asset, which may result in adverse tax consequences to the Purchaser, including, without limitation, withholding taxes, transfer taxes, value added taxes, income taxes and similar taxes, levies, duties or other charges and tax reporting requirements.

  1. Risk of alternative networks / competitors

It is possible that alternative networks could be established in an attempt to facilitate services that are similar to the Services, or alternative networks could be established that utilise the same or similar code and protocol underlying the Virtual Asset and/or the Platform. The Platform may compete with these alternative networks, which could negatively impact the Platform and/or Virtual Asset.

  1. Risk of Insufficient Interest in the Platform or Distributed Applications

It is possible that the Platform will not be used by a large number of individuals, companies and other entities or that there will be limited public interest in the creation and development of distributed ecosystems (such as that on the Platform) more generally. Such lack of use or interest could negatively impact the development of the Platform and therefore the potential utility of the Virtual Asset.

  1. Risks Associated with the Development and Maintenance of the Platform

The Platform is still under development and may undergo significant changes over time. Although it is intended for the Virtual Asset and the Platform to follow the specifications set forth in the whitepaper, and the relevant Group Entity will endeavour to work towards those ends (subject to internal business considerations), changes may be required to be made to the specifications of the Virtual Asset or the Platform for any number of reasons. This could create the risk that the Virtual Asset or the Platform, as further developed and maintained, may not meet the Purchaser’s expectations or requirements at the time of purchase. Furthermore, despite the Company’s good faith efforts to develop and maintain the Platform, it is still possible that the Platform will experience malfunctions or otherwise fail to be adequately developed or maintained, which may negatively impact the Platform and Virtual Asset.

  1. Inadequate Disclosure of Information

As at the date hereof, the Platform is still under development and its design concepts, consensus mechanisms, algorithms, codes, and other technical details and parameters may be constantly and frequently updated and changed. Although this Agreement contains the most current information relating to the Platform, it is not absolutely complete and may still be adjusted and updated by the team from time to time. The team has no ability and obligation to keep holders of the Virtual Assets informed of every detail (including development progress and expected milestones) regarding the project to develop the Platform, hence insufficient information disclosure inevitable and reasonable.

  1. Risk of an Unfavourable Fluctuation of Currency Value

The Company intends to use the proceeds from selling the Virtual Asset to support the maintenance and development of the Platform. The proceeds of the sale of the Virtual Asset will be mainly denominated in USDT, USDC and possibly other digital assets, and may be converted into other cryptographic and fiat currencies. In addition, sales of Virtual Asset may also be denominated in fiat currencies. If the value of digital assets fluctuates unfavourably during or after the sale of the Virtual Asset, the relevant Group Entity may not be able to support development plans, or may not be able to maintain the Platform in the manner that it intended.

  1. Risks Related to Our Corporate Structure

The legal structure for the Group Entities (including the intra-Group arrangements) is bespoke and there is no generally accepted standard or structure for similar projects in the distributed ledger technology space. The legal structure had been designed to address certain specific legal risks, and attempt to decentralise the management and control, as well as economic risks and benefits relating to the Platform and Virtual Asset; but there is no legal precedent for whether these structures are effective and it is difficult to predict the position that a regulator may adopt. The legal structure and contractual arrangements may not be effective in decentralising management and control, thereby adversely affecting the value of the Platform and/or Virtual Asset.

  1. Risk of Dissolution of the Company, any Group Entity or the Platform

Start-up companies such as the Company involve a high degree of risk. Financial and operating risks confronting start-up companies are significant, and the Company is not immune to these. Start-up companies often experience unexpected problems in the areas of product development, marketing, financing, and general management, among others, which frequently cannot be solved.

It is possible that, due to any number of reasons, including, but not limited to, an unfavourable fluctuation in the value of cryptographic and fiat currencies, decrease in the utility of the Virtual Asset due to negative adoption of the Platform, the failure of commercial relationships, or intellectual property ownership challenges, the Platform may no longer be viable to operate and the Company or any Group Entity may be dissolved.

  1. Risks Arising from Lack of Governance Rights

Because the Virtual Asset confers no governance rights of any kind with respect to the Company or any Group Entity, all decisions involving the Company or its Group Entities will be made by the relevant Group Entity at its sole and absolute discretion, including, but not limited to, decisions to discontinue the operations or development of the Platform, to create and sell more Virtual Asset for use within the Platform, or to sell or liquidate any Group Entity. These decisions could adversely affect the Platform and the Virtual Asset held by the Purchaser.

  1. Risks Involving Cloud Storage

As the Platform may provide or utilise a decentralised cloud storage service for users and applications, therefore the Services are susceptible to a number of risks related to the storage of data in the cloud. The Services may involve the storage of large amounts of sensitive and/or proprietary information, which may be compromised in the event of a cyberattack or other malicious activity. Similarly, the Services may be interrupted and files may become temporarily unavailable in the event of such an attack or malicious activity. Because users can utilise a variety of hardware and software that may interface with the Platform, there is the risk that the Services may become unavailable or interrupted based on a failure of interoperability or an inability to integrate these third-party systems and devices that the Group Entities do not control. The risk that the Services may face increasing interruptions and the Platform may face additional security vulnerabilities could adversely affect the Platform and therefore the future utility of any Virtual Asset held by the Purchaser.

  1. Forking

The Platform is a community project and certain elements are open-sourced. The Company (nor any Group Entity) does not and cannot monopolise the development, marketing, operation or otherwise of the Platform and blockchain. Any entity may independently develop a patch or upgrade of the source code of the Platform and blockchain without prior authorisation of any other party, and launch the same by deployment on any blockchain network. The acceptance of these patches or upgrades by a sufficient (not necessarily overwhelming) percentage of Virtual Asset holders could result in a “fork” in the network, and consequently two diverging networks will emerge and remain. Each branch arising from the fork will have its own native cryptographic tokens – accordingly there will be two different versions of the Platform and/or Virtual Asset respectively residing in the two divergent branches with almost identical technical features and functions. The tokens on the diverging network will not be the Virtual Asset.

Further, it is theoretically possible for each branch of the forked blockchain to be further forked an unlimited number of times. The temporary or permanent existence of forked blockchains could adversely affect the operation of the Platform and blockchain and the Virtual Asset held by the Purchaser, and may ruin the sustainability of the Platform.

  1. Risks associated with a lack of markets for the Virtual Asset

There is no prior market for the Virtual Asset and the sale of the Virtual Asset may not result in an active or liquid market for the Virtual Asset. The Virtual Asset is designed to be utilised solely within the Platform, hence there may be illiquidity risk with respect to the Virtual Asset held by the Purchaser. The Virtual Asset is not a currency issued by any central bank or national, supra-national or quasi-national organisation, nor is it backed by any hard assets or other credit nor is it a “commodity” in the usual and traditional sense of that word. The Company is not responsible for, nor does the Company pursue, the circulation and trading of the Virtual Asset on any market. Trading of the Virtual Asset will merely depend on the consensus on its value between the relevant market participants. No one is obliged to purchase any Virtual Asset from any holder of the Virtual Asset, nor does anyone guarantee the liquidity or market price of the Virtual Asset to any extent at any time. Furthermore, the Virtual Asset may not be resold to a purchaser who is a citizen, national, resident (tax or otherwise), domiciliary or green card holder of a Restricted Territory or to purchasers where the purchase of the Virtual Asset may be in violation of applicable laws. Accordingly, the Company cannot ensure that there will be any demand or market for the Virtual Asset, or that the Purchase Price paid for the Virtual Asset is indicative of any market valuation or market price for the Virtual Asset.

Even if secondary trading of the Virtual Asset is facilitated by third party exchanges, such exchanges may be relatively new and subject to little or no regulatory oversight, making them more susceptible to fraud or manipulation. Furthermore, to the extent that third parties do ascribe an external exchange value to the Virtual Asset (e.g., as denominated in a digital or fiat currency), such value may be extremely volatile, decline below the Purchase Price which the Purchaser had paid for the Virtual Asset, and/or diminish to zero.

  1. Inflation

Due to the nature and operation of blockchain protocols, the total amount of circulating the Virtual Asset could increase through the adoption of a new patch or upgrade of the source code. Any inflation in the quantity of the Virtual Asset could adversely affect the market price of the Virtual Asset, and consequently Purchasers may suffer economic losses. Neither the Company nor any Group Entity provides any guarantee that a Purchaser would be compensated (in any manner) for such inflation.

  1. Loss of Talent

The development of the Platform depends on the continued co-operation of the existing technical team and expert consultants, who are highly knowledgeable and experienced in their respective sectors. The loss of any member may adversely affect the Platform or its future development. Further, stability and cohesion within the team is critical to the overall development of the Platform. There is the possibility that conflict within the team and/or departure of core personnel may occur, resulting in negative influence on the project in the future.

  1. Failure to develop

The Platform is still in the developmental stage, hence there may be large changes to the final design before the official version is released. There is the risk that the development of the Platform will not be executed or implemented as planned, or may not meet any expectation of purchasers of the Virtual Asset, for a variety of reasons, including without limitation the event of a decline in the prices of any digital asset, virtual currency or the Virtual Asset, unforeseen technical difficulties, and shortage of development funds for activities.

  1. Unanticipated Risks

Cryptographic tokens such as the Virtual Asset are a new and untested technology. In addition to the aforementioned risks, there may be other risks associated with the Purchaser’s purchase, holding and use of the Virtual Asset, including those that the Company cannot anticipate. Such risks may further materialise as unanticipated variations or combinations of the risks discussed in this Disclosure Statement.