Risk Disclosure

Investing always involves risks. At VETA, we strive to provide transparent, decentralized, and efficient financial products. However, understanding the inherent risks is paramount to making informed decisions. Here are the key risks associated with investing in our structured products:

Principal Risk

VETA's structured products involve a risk to the principal amount invested. This means there's a possibility of losing part or all of your initial investment. Despite our risk mitigation efforts, we can't guarantee that you will receive your entire initial investment amount at maturity.

Smart Contract Risk

VETA's structured products are governed by smart contracts on the Ethereum blockchain. Once these contracts are deployed, they can't be altered, reflecting the principle that the code of the smart contract governs its operation. However, any bugs or vulnerabilities in the smart contract code could potentially lead to financial loss. We recommend thoroughly understanding the workings of smart contracts before investing.

Liquidity Risk

Structured products on the VETA platform are designed for longer-term investment rather than short-term trading. They're not transferable, and there's currently no secondary market, which means you can't sell them. You should be prepared to hold the structured product until its scheduled maturity. Note that we're planning to introduce secondary market transfer capabilities in future platform updates. Until then, early termination or withdrawals are not permitted without our consent.

Credit and Counterparty Risk

Credit and Counterparty Risk: Our margin system is designed to reduce the likelihood of default by either the buying or selling parties on the VETA platform. In case of a default, a forced liquidation event might occur. The smart contract would then penalize the defaulting party and compensate the party who has fulfilled their obligations. However, these systems do not completely eliminate credit and counterparty risk.

Leverage Risk and Margin Call Risk

If you've used leverage to purchase the structured product, or if the product's terms include leverage, small market movements or changes in the price or level of the underlying asset can have a disproportionately large impact on the value of the product and your potential returns. This can work both for and against you. Additionally, using leverage and our margin systems can expose you to the risk of margin calls and forced liquidations.

Remember, all investments come with risks. Our aim is to empower you with effective decentralized financial products, but understanding the associated risks is crucial for your investment decisions.