Asset Reservation and Risk Management Policy

Entered into force on February 21, 2026.

On-chain voting result: association.dao.eth/transaction-hash

1. General Provisions and Objectives

1.1. Hierarchy: This Asset Reservation and Risk Management Policy (hereinafter the "Policy") is a mandatory act enacted by the Governance Resolution. It supplements, but does not contradict, the provisions on financial management established in the Executive Act.

1.2. Objective: The primary objective of the Policy is the mandatory formation and maintenance of Asset Reserve Funds to cover special research and development, public awareness activities, potential legal expenses, indemnity provision for Authorized Representatives, and systematic management of key operational and financial risks of the Association.

1.3. Terminology: For the purposes of this Policy, the "Special Research Fund" (hereinafter "SRF"), the "Special Development Fund" (hereinafter "SDF"), the "Awareness Raising Fund" (hereinafter "ARF"), and the "Legal Support Fund" (hereinafter "LSF") mean internally segregated and reserved financial reserves within the general Assets of the Association, established in accordance with the Governance Resolution to ensure targeted financing of the respective activity areas.

1.4. Applicable Law: This Policy is governed by the substantive law of Switzerland. Lex Cryptographica (protocol code) is applied subsidiarily.

2. Special Research Fund

2.1. Purpose: The Association is obliged to create and constantly maintain the SRF, which is a specialized, liquid reserve. The SRF is intended exclusively to cover:

2.1.1. Expenses for conducting specialized research according to the requirements of technical specifications of the respective Projects published on the Association’s website.

2.1.2. Expenses for informational support of Teams conducting specialized developments according to the requirements of technical specifications of the respective Projects published on the Association’s website.

2.1.3. Expenses for advisory support of Teams conducting specialized developments according to the requirements of technical specifications of the respective Projects published on the Association’s website.

2.2. Mandatory Threshold: The Association undertakes to maintain a minimum threshold of liquid assets in the SRF equivalent to 10% of the total value of the Association’s Assets.

2.3. Asset Form: SRF assets must be held primarily in highly liquid, minimally risky digital assets (e.g., audited stablecoins) placed in a dedicated smart contract with restricted spending access.

2.4. Activation Condition: SRF funds may only be spent in connection with the need for specialized information to enhance the effectiveness of specialized developments by Teams, and only if such spending corresponds to the technical specification requirements of the respective Projects and/or the Mission of the Association.

2.5. Approval Procedure: Any expenditure of SRF funds (except in emergency, urgent expenses) requires Qualified Confirmation (multisignature), executed in accordance with the Governance Resolution and initiated by the Association or a specially appointed Authorized Representative for team interaction.

2.6. Fund Replenishment: If the use of the SRF causes the balance to fall below the mandatory threshold, the Association must initiate fund replenishment to the minimum threshold through Voting with Qualified Confirmation for allocating funds from the Association’s general Assets.

2.7. Prohibition of Use: Use of SRF funds for public awareness, Grant financing, legal protection, compliance, investment operations, or any other purposes not directly related to conducting specialized research is strictly prohibited.

3. Special Development Fund

3.1. Purpose: The Association is obliged to create and constantly maintain the SDF, which is a specialized, liquid reserve. The SDF is intended exclusively to cover:

3.1.1. Expenses for providing Grants in accordance with the Grant and Intellectual Property Agreement.

3.2. Mandatory Threshold: The Association undertakes to maintain a minimum threshold of liquid assets in the SDF equivalent to 15% of the total value of the Association’s Assets.

3.3. Asset Form: SDF assets must be held primarily in highly liquid, minimally risky digital assets (e.g., audited stablecoins) placed in a dedicated smart contract with restricted spending access.

3.4. Activation Condition: SDF funds may be spent only in connection with the necessity to provide Grants to Teams, and only if such expenditure corresponds to the requirements of the technical specifications of the respective Projects and/or the Mission of the Association.

3.5. Approval Procedure: Any expenditure of SDF funds requires Qualified Confirmation (multisignature), executed in accordance with the Governance Resolution and initiated by the Association or a specially appointed Authorized Representative for team interaction.

3.6. Fund Replenishment: If the use of the SDF causes the balance to fall below the mandatory threshold, the Association must initiate fund replenishment to the minimum threshold through Voting with Qualified Confirmation for allocating funds from the Association’s general Assets.

3.7. Prohibition of Use: Use of SDF funds for specialized research, public awareness, legal protection, compliance, investment operations, or any other purposes not directly related to financing Grants is strictly prohibited.

4. Awareness Raising Fund

4.1. Purpose: The Association is obliged to create and constantly maintain the ARF, which is a specialized, liquid reserve. The ARF is intended exclusively to cover:

4.1.1. Expenses for conducting campaigns to inform the public about the results of specialized research and development, as well as about the activities and Mission of the Association.

4.2. Mandatory Threshold: The Association undertakes to maintain a minimum threshold of liquid assets in the ARF equivalent to 10% of the total value of the Association’s Assets.

4.3. Asset Form: ARF assets must be held primarily in highly liquid, minimally risky digital assets (e.g., audited stablecoins) placed in a dedicated smart contract with restricted spending access.

4.4. Activation Condition: ARF funds may be expended only in connection with insufficient public awareness for Mission implementation regarding the Association’s activities, and only if such spending contributes to the realization of the Association’s Mission.

4.5. Approval Procedure: Any expenditure of ARF funds requires Qualified Confirmation (multisignature), executed in accordance with the Governance Resolution and initiated by the Association or a specially appointed Authorized Representative for public awareness enhancement.

4.6. Fund Replenishment: If the use of the ARF causes the balance to fall below the mandatory threshold, the Association must initiate fund replenishment to the minimum threshold through Voting with Qualified Confirmation for allocating funds from the Association’s general Assets.

4.7. Prohibition of Use: Use of ARF funds for specialized research, Grant financing, legal protection, compliance, investment operations, or any other purposes not directly related to enhancing public awareness of the Association’s activities is strictly prohibited.

5. Legal Support Fund

5.1. Purpose: The Association is obliged to create and constantly maintain the LSF, which is a specialized, liquid reserve. The LSF is intended exclusively to cover:

5.1.1. Expenses for legal protection of Authorized Representatives in accordance with the Indemnity Agreement.

5.1.2. Expenses for arbitration proceedings, compliance audits, and mandatory legal consultations.

5.1.3. Expenses for engaging qualified legal and tax consultants to prepare general informational-legal memoranda (hereinafter "Informational Memoranda") concerning the probable tax regime of the Association, Grants receipt, or Token ownership in key jurisdictions (including but not limited to Switzerland, USA, Singapore, and EU countries). Disclaimer: Such Informational Memoranda are not tax, investment, or legal advice for specific individuals and under no circumstances replace the necessity for Participants and Authorized Representatives to obtain personal consultation from their own tax advisors. The Association is not responsible for their individual tax interpretation.

5.2. Mandatory Threshold: The Association undertakes to maintain a minimum threshold of liquid assets in the LSF equivalent to 5% of the total value of the Association’s Assets.

5.3. Asset Form: LSF assets must be held primarily in highly liquid, minimally risky digital assets (e.g., audited stablecoins) placed in a dedicated smart contract with restricted spending access.

5.4. Activation Condition: LSF funds may be spent only in connection with imminent or actual legal proceedings, and only if such expenditure complies with the Association’s obligations under the Indemnity Agreement.

5.5. Approval Procedure: Any expenditure of LSF funds (except for emergency, urgent legal expenses) requires Qualified Confirmation (multisignature), executed in accordance with the Governance Resolution and initiated by the Association or a specially appointed Authorized Representative for legal support.

5.6. Fund Replenishment: If the use of the LSF causes the balance to fall below the mandatory threshold, the Association must initiate fund replenishment to the minimum threshold through Voting with Qualified Confirmation for allocating funds from the Association’s general Assets.

5.7. Prohibition of Use: Use of LSF funds for specialized research, Grant financing, public awareness, investment operations, coverage of personal tax obligations of fund recipients, or any other purposes not directly related to legal protection and compliance is strictly prohibited.

6. Risk Management Policy

6.1. Operational Risk: Authorized Representatives must conduct reasonable and necessary technical and legal analyses to reduce operational risks related to:

6.1.1. Interaction with third-party protocols (DeFi/DLT): Use only audited, verified, and widely recognized protocols; avoid protocols with high risk of default or centralized points of failure.

6.1.2. Storage security: Use best practices for storing private keys and passphrases, including multisignature application for access to primary assets.

6.1.3. Use of bridges: Use only audited, verified, and proven reliable bridges between blockchains.

6.2. Market Risk: The Association is not an investment fund. Authorized Representatives must avoid excessive concentration of assets in high-risk, volatile, or low-liquidity instruments. Major assets outside the LSF may only be invested through Voting with Qualified Confirmation after providing a comprehensive risk analysis.

6.3. Regulatory Risk: Authorized Representatives must ensure full and strict compliance with the requirements set forth in the Anti-Money Laundering, Counter-Terrorism Financing, and International Sanctions Policy. This includes:

6.3.1. Initiating mandatory KYC/KYB procedures and sanction list checks.

6.3.2. Incorporating arbitration and applicable law provisions by reference into all international contracts, as provided by the Arbitration Rules.

7. Reporting and Audit

7.1. Reporting: The Authorized Representative for Legal Support is obliged to provide reports on LSF usage upon Association request through on-chain transaction at any time when reasonable grounds exist.

7.2. Audit: The Association may initiate an independent audit of its smart contracts, assets, and compliance procedures. Audit results must be presented to the Association’s community via official notice published on the Association’s website.

8. Effective Date and Amendments

8.1. Effective Date: This Policy becomes effective simultaneously with the date and time the Governance Resolution enters into force.

8.2. Amendments: Any changes to this Policy may only be made through Voting with Qualified Confirmation performed in accordance with provisions established in the Governance Resolution.

8.3. Notice: Continued use of the Association’s website, software, and Tokens after posting amendments signifies user acceptance of the updated Policy.