ADDITIONAL TERMS APPLICABLE TO THE PERPETUAL FUTURES PRODUCTS

ADDITIONAL TERMS APPLICABLE TO THE PERPETUAL FUTURES PRODUCTS


All capitalized terms and references used in these Additional Terms that are defined and construed in the Investor Business Terms ("Terms") but are not defined or construed in these Additional Terms shall have the same meaning and construction in these Additional Terms. For the avoidance of doubt, where a term is defined both in the Terms and in these Additional Terms, for the purposes of these Additional Terms only, the definition in these Additional Terms shall prevail.

The terms set out hereunder shall be supplemental to and are to be read together with the Terms. In the event of any conflict or inconsistency between the provisions set out under the Terms and these Additional Terms, the terms in these Additional Terms shall prevail unless expressly stated otherwise.

There are additional specific risks that apply to trading in Perpetual Futures Products, which are set out in in Clause 2 of the Additional Terms. You must have the financial ability, sophistication, experience, tolerance, and willingness to bear the additional specific risks to Perpetual Futures Products. Perpetual Futures Products are a complex product and the trading of Perpetual Futures Products is highly risky and are not suitable for all investors. There is a risk that you may lose all of your investment. Before acquiring a Perpetual Futures Product, please carefully review your financial situation, experience and objectives for engaging in the transaction, ability to bear risks and other relevant circumstances to determine whether such products are suitable for you. You should consult professional advisors (including legal, tax, financial and accounting) as may be appropriate. By entering into any Transaction for Perpetual Futures Products, you agree that you assume all the risk of your Transactions and that HBML and/or its group affiliates will not be responsible for any losses you may suffer.

The Perpetual Futures Product is intended for Clients who are authorized to access the Products and Services. It is not intended for Clients who are subject to any applicable restrictions. You are responsible for familiarizing yourself with and complying with any restrictions and/or requirements regarding the access and use of the Products and Services offered by HBML in each country or region from which you access them (or where applicable, the Products or Services are accessed on your behalf). HBML reserves the right to modify, change, or impose additional restrictions on your access and use of the Products and/or Services at any time, at its sole discretion, without prior notification.

1. PERPETUAL FUTURES PRODUCT
   1. The Perpetual Futures Product is a product that allows the Client to trade Perpetual Futures contracts on certain Digital Assets trading pairs ("Perpetual Futures Products") through the HashKey Exchange. The Client may participate in the Perpetual Futures Product in accordance with the Terms and these Additional Terms.
   2. By using the Services and entering into a Transaction for Perpetual Futures Products, which HBML may in its absolute discretion provide to the Client from time to time, you agree to be bound by these Additional Terms. The Client also acknowledges and agrees that it has sufficient investment knowledge, financial expertise, and experience and the capacity to take on the increased risks arising from trading Perpetual Futures Products. The Client further agrees to independently assume all the risks arising from conducting trading in Perpetual Futures Products on their own account. If the Client is uncomfortable with the associated risks, including but not limited to the additional specific risks set out in Clause 2 the Client should not trade Perpetual Futures Products.
2. ADDITIONAL RISKS ASSOCIATED WITH PERPETUAL FUTURES PRODUCTS

In addition to the other risks disclosed by HBML that are relevant to the Client's use of the Services and Products, the following risks apply:

1. Perpetual Futures Products is a derivative product and may not be suitable for all investors. Before investing, investors should understand its nature and risks, such as extremely high price volatility of Digital Asset futures and the value of the Digital Asset futures may decline significantly, including to zero. All the risks relating to the underlying Digital Assets may be magnified as trading in Digital Asset futures is inherently risky - the underlying Digital Assets are speculative in nature and leverage is used in futures trading.
2. Perpetual futures contracts are complex products and the trading of Perpetual Futures Products is high risk. The market price of any perpetual futures contracts may not reflect the price of spot markets in the applicable underlying Digital Assets, and may fluctuate significantly in response to the value of the underlying Digital Asset’s(s') price, supply and demand, and other market factors.
3. The valuation of Digital Assets and Digital Asset related products is usually not transparent, and highly speculative. Digital Asset related products are highly speculative products and their prices can fluctuate greatly within a short period of time.
4. The risk of loss is substantial. Under exceptional market circumstances, the price of Digital Assets and hence the price of Digital Asset futures may drop to zero in a short period of time. An investor should be prepared to lose the full principal value of their investment in Perpetual Futures Products within a single day. Investors may sustain losses greater than their principal investment as a result.
5. In order to trade Perpetual Futures Products, the Client must post collateral. Depending on market movements, the Client's positions may be liquidated and the Client may sustain a total loss of the assets in the Account. This is because futures contract trading can be highly leveraged, with a relatively small amount of funds used to establish a position in a Digital Asset or index having a much greater value. As a result, a relatively small price movement in a Digital Asset futures may result in a proportionally high impact and substantial losses to a Digital Asset futures contract. This may result in losses in excess of the amount invested. For instance, a small price decrease on a 20x leveraged futures contact’s underlying Digital Asset could result in 20x loss in your leveraged position in the futures contract. Further, short positions will lose money when the price of the underlying Digital Asset rises, a result that is opposite from holding the underlying Digital Asset.
6. Clients are exposed to high concentration risk in a single reference asset (e.g. bitcoin or ether) and/or a single futures contract. Clients with substantial investments in Digital Asset futures may be exposed to higher concentration risks.
7. If the market moves against the futures position, the investors may be required to pay additional margins to maintain the trading positions on short notice. Clients may need to liquidate assets at unfavourable prices in order to meet these margin calls and suffer substantial losses.
8. Investors may sustain losses in excess of the collateral provided to meet margin calls. Investors may also sustain a total loss of any collateral that is provided to establish or maintain a position. If the collateral is not provided within the time required to meet margin calls, the Client's collateral may be liquidated and other actions may be taken without your consent, forced position reduction and liquidation. Further, you will be responsible and liable for any resulting deficit in the Account. It is the responsibility of the Client investor to ensure that he/she has sufficient margin in the Account to support when there are any outstanding positions.
9. In addition to the above, Clients should also note:
   • Clients should be aware that when the auto-deleveraging mechanism is triggered, Clients may be required to make unforeseen payments.
   • Perpetual Futures Products do not expire and Clients will be required to make payments for long periods of time.
   • HBML may at its sole discretion determine to terminate the offering of the Perpetual Futures Product. As a result, investors may suffer losses. HBML and/or its group affiliates will not be responsible for any losses resulting from such termination.
10. TRANSACTIONS FOR PERPETUAL FUTURES PRODUCTS
11. In order to enter into Transactions for the Perpetual Futures Products, the Client must satisfy the eligibility criteria determined by HBML from time to time. HBML may change the eligibility criteria relating to the use of the Perpetual Futures Product at any time, including introducing additional requirements. To be eligible to enter into Transactions for the Perpetual Futures Products, the Client:
    • may be required to submit additional documents or information to HBML and obtain HBML's approval;
    • must comply with HBML’s onboarding requirements (including but not limited such requirements related to jurisdiction) and product access requirements as amended from time to timeHBML; and
    • represents, warrants and undertakes that its use of the Perpetual Futures Products is and shall at all times comply with all Applicable Laws.
    • ; and must agree to be bound by the Rules.
12. If the Client is not (or is no longer) eligible to use the Perpetual Futures Product, each of the Transactions for Perpetual Futures contracts will be terminated immediately.
13. To enter into a Transaction for Perpetual Futures Products the Client will be required to post collateral in the form of Digital Assets to cover the Initial Margin and Maintenance Margin.. The Client agrees that HBML may, in its sole discretion, set the Initial Margin and Maintenance Margin requirements and the limits on leverage for each open, unexecuted order and each open position in the Perpetual Futures Product.
14. The Client agrees not to create any encumbrance or allow any encumbrance to exist on the whole or any part of the collateral or attempt to dispose (or agree to dispose of) or otherwise deal with any of the collateral without HBML's prior written consent.
15. HBML may, in its sole discretion, refuse, impose limits on or impose other conditions or restrictions on any Transaction for the Perpetual Futures Products or use of the Services without prior notice.
16. The Client should ensure that it has funds in his/her Account to complete any Transaction for the Perpetual Futures Products.
17. In respect of the collateral provided by the Client to HBML, the Client agrees that:
    • In order to secure the obligations of the Client, the Client hereby assigns, pledges, transfers, and grants to HBML, as secured party, a continuing first priority perfected security interest in, and a lien upon, all of the Client's right, title, and interest in, to and under, whether now owned, or hereafter acquired, the collateral assets in the Account.
    • Notwithstanding any provision or instructions to the contrary, the collateral held as continuing security and shall be subject to a general lien and right of set off in favor of HBML for any and all of the Client's obligations, liabilities or monies whatsoever at any time now or hereafter owing, due, incurred or payable by the Client to HBML under these Additional Terms or otherwise, whether present or future, actual or contingent, solely or jointly or whether as principal or surety, and HBML may realise any of the collateral as provided for under these Additional Terms.
    • Subject to HBML’s rights under these Additional Terms (including, without limitation, HBML’s rights pursuant to a Liquidation or termination as set out in Clauses 4 and 5, HBML will not sell, transfer, loan, hypothecate, rehypothecate or pledge any collateral provided to HBML unless instructed by the Client, authorised under these Additional Terms, or compelled by a court of competent jurisdiction to do so.
    • It will maintain sufficient collateral at all times for outstanding Transactions.
    • HBML may deal with the collateral in accordance with any applicable authority  given by the Client in accordance with these Additional Terms and comply with the requirements and limits pursuant to Applicable Laws.
    • HBML may upon the enforcement of its rights, sell, dispose of, realise, convert into any other Digital Asset or fiat currencies or otherwise deal with the collateral as agent or as mortgagee or pledgee of the Client, as HBML may at its discretion deem fit, without incurring any liability whatsoever or howsoever in respect of such fiduciary capacity.
    • No interest shall be paid on any collateral deposited by the Client and HBML shall not have any liability for fluctuations in the fiat currency value of the collateral deposited.
18. The Client agrees and authorises HBML and its Affiliates to take any measures in their sole discretion, including but not limited to, forced position reduction and liquidation under market volatility, illiquidity and other circumstances, for the purposes of mitigating potential losses to the Client, other clients, HBML and its Affiliates.
19. HBML and its Affiliates do not take any responsibility whatsoever for any losses or damage incurred as a result of the Client's trading of Perpetual Futures Products on the HashKey Exchange or the Client's failure to understand the risks associated with trading Perpetual Futures Products.
20. LIQUIDATION
21. The Client may be required to deposit additional collateral to satisfy Maintenance Margin requirements as required by HBML from time to time and to secure the Client's performance of any obligations due to HBML under these Additional Terms.
22. In the event that the Client's margin balance fails to meet the Maintenance Margin requirement (for example, if there is insufficient collateral), HBML has the sole discretion to liquidate any open positions in any collateral in the Account either in full, or in an amount sufficient, in HBML’s reasonable discretion, to restore the value of the collateral to an amount equal to or exceeding the Maintenance Margin requirements. For the avoidance of doubt, HBML is not required to provide notice or margin calls before liquidating collateral in the Account. The Client acknowledges and agrees that it is the Client's sole responsibility to maintain the value of the collateral in the Account to equal or exceed the Maintenance Margin requirement at all times.
23. The Client agrees and acknowledges that if with respect to open positions maintained in the Perpetual Futures Products, the Mark Price of the relevant Futures hits the Liquidation Price and the collateral in the Account falls below the required Maintenance Margin, HBML will begin to automatically close out open positions without notice as soon as market conditions allow until the first of the following occurs:
    • the collateral in the Account is equal to, or greater than, the required Maintenance Margin for all remaining open positions; or
    • all open positions in the Perpetual Futures Products have been terminated

(such process, a “Liquidation”). 

A Liquidation will result in all open orders for any Perpetual Futures Product being immediately cancelled in order to increase the Client's ability to meet Margin Maintenance requirements.  HBML is not required to provide notice before commencing Liquidation. If, following a Liquidation, there is a negative balance in the Account, the Client will be considered “bankrupt” and HBML may step in to take over the remaining positions and offload them onto the market gradually via the use of a reserve fund to make up the losses caused with the intention of reducing the possibility of auto-deleveraging. In the event that the reserve fund is unable to accept positions, such as in periods of extreme market volatility, counterparty liquidation will occur and positions held by opposing Clients will be liquidated in accordance with a priority ranking calculation which results in highly leveraged positions being closed out first in accordance with the auto-deleveraging mechanism.

1. TERMINATION
   1. In addition to other rights set out in the Terms, HBML may, in its sole discretion, without liability to the Client, with or without prior notice, suspend or terminate the Client's access to all or a portion of the Services, including access to the Perpetual Futures Products upon the occurrence of the following events:
      • any failure by the Client or Authorized Persons to provide requested documentation or information for identity verification to satisfy AML/CFT requirements;
      • any failure to maintain the required margin or collateral for open positions;
      • the occurrence of an Event of Default;
      • where HBML is required to do so by Applicable Law, or any court or authority to which HBML is subject in any jurisdiction;
      • the use of the Client's Account is subject to any pending, ongoing or threatened litigation, investigation, or judicial, governmental or regulatory proceedings and/or HBML perceives a heightened risk of legal or regulatory non-compliance associated with the Account activity;
      • where HBML suspects that the Account is being used to engage in illegal activities or there is an occurrence of money laundering, terrorist financing, fraud or any other crime in connection with the Account or the Client's use of the Services; and
      • there is any other valid reason which requires HBML to do so.
   2. HBML may, in its sole discretion and without liability to the Client, with or without prior notice, close the Client's position and exit any Perpetual Futures Products.
   3. In addition to its other rights, HBML may, in its sole discretion:
      • remove the Perpetual Futures Product from the HashKey Exchange by providing notice through the Website. If this occurs, any and all open positions the Client may have at the date and time the Perpetual Futures Product ceases to be made available as part of the Products and Services offered by the HashKey Exchange will be closed; and
      • close out any and all positions HBML reasonably determines as is required for the purpose of protecting itself against risk of loss.
   4. The Client agrees not to hold HBML liable for any loss arising from any action taken in accordance with this Clause 5.
2. FEES
   1. Perpetual Futures contracts represent obligations to buy or sell a Digital Asset at a specific price, at any time while the contract remains open. Perpetual Futures contracts do not have an expiry date but, instead, continuously roll over, i.e. every hour. By entering into a Transaction for Perpetual Futures Products through the HashKey Exchange, the Client will be required to pay or be entitled to receive a Funding Fee every eight (8) hours if it maintains any open positions in Perpetual Futures Products.
   2. In extreme market conditions, the Funding Fees can be very high. This means that it is costly to maintain a long-term position in a market.
   3. The Client agrees to pay the fees for Transactions for the Perpetual Futures Products as set out in the Fee Schedule available on the Website. The Client acknowledges that such Fee Schedule may be updated by HBML from time to time in accordance with the Terms.
3. DEFINED TERMS APPLICABLE TO THE PERPETUAL FUTURES PRODUCT ADDITIONAL TERMS

"Funding Fee" means the payments that apply to the Perpetual Futures Products that the Client is required to pay or be entitled to receive if it maintains any open positions in Perpetual Futures Products.

"Initial Margin" means the minimum amount of collateral value required to open a new position.

“Liquidation” is as defined in Clause 4.3 of these Additional Terms.

“Liquidation Price” means the Mark Price at which Liquidation occurs. For the avoidance of doubt, the Liquidation Price as quoted is for reference only and shall not be binding on HBML.

"Maintenance Margin" means the minimum amount of collateral value required to maintain an open position.

"Mark Price" means the index price calculated using a specific weighted price formula that draws pricing data from multiple reputable exchanges to determine the market price of the Perpetual Futures product. For further details on the calculation of the Mark Price, please refer to the Trading related FAQs.