AML/CTF POLICY

This AML/CTF Policy establishes the principles and procedures applied by the Company for the purpose of preventing the use of the Service for money laundering, terrorist financing, circumvention of sanctions restrictions and other unlawful activities.

The Policy regulates, including:

• procedures for identification and verification of Users (KYC);

• transaction monitoring and risk assessment;

• application of measures to identify and prevent suspicious activity;

• interaction with competent authorities in cases provided for by applicable requirements.

The Company applies a risk-based approach in implementing AML/CTF procedures, including the assessment of Users, transactions and other risk factors.

1. Definitions

Identity Verification (KYC) — is the process of identifying the User and verifying their identity based on the provided data, documents and/or other means of authentication for the purpose of confirming that the User is the person they claim to be. KYC is part of the customer due diligence procedures ( CDD, EDD).

AML/CFT (Anti-Money Laundering and Combating the Financing of Terrorism) — a set of international and national norms, rules and procedures aimed at preventing the use of the financial system for laundering proceeds obtained through criminal means, financing terrorist and extremist organizations, circumventing sanctions and carrying out other illegal operations.

Proof of Funds (PoF) — provision of documents, data or other confirmations allowing to establish that the funds used by the User actually belong to them, were sent by them independently and originated from the declared source (including a specific platform, service or wallet).

Source of Funds (SoF) — provision of information and/or documents confirming the economic origin of funds used in a specific transaction or operation.

Source of Wealth (SoW) — provision of information and/or documents confirming the general origin of the User's wealth (capital), formed as a result of their activities over a certain period of time.

Enhanced Due Diligence (EDD) — an additional level of verification applied in cases of an increased level of risk identified in relation to the User, transaction or related persons. Within the EDD, the Company has the right to request an expanded amount of information and documents, including information about the source of funds (SoF), source of wealth (SoW), income level, nature of economic activity and other supporting documents.

High-risk transaction — a transaction which, based on the results of an internal risk assessment, may indicate an increased likelihood of money laundering, terrorist financing, circumvention of sanctions restrictions or other unlawful activity. Such transactions may include operations with atypical parameters, involvement of high-risk jurisdictions, links to sanctioned entities or other risk factors.

High-risk address labels — a classification (label/tag) assigned to crypto addresses based on data from blockchain analytics systems when identifying their possible connection with unlawful or high-risk activity. Such labels may include, but are not limited to, links to darknet markets, fraud (scam), stolen funds, sanctioned entities and other risk categories within AML/CTF.

Dark Market (darknet platforms) — online resources operating, as a rule, in anonymous networks and intended for trading in illegal goods or services, including, but not limited to, narcotic substances, weapons, stolen data and other prohibited objects.

Sanctions — restrictive measures imposed by government authorities or international organizations on states, legal entities or individuals, aimed at restricting or prohibiting certain operations, including financial transactions and economic activity.

Stolen Funds (stolen funds) — cryptoassets which, according to available data, may have been obtained as a result of unauthorized access, theft, hacking or fraudulent actions, or are associated with such incidents.

Scam (fraud) — activity aimed at misleading for the purpose of illegally obtaining monetary funds or other assets. In the context of cryptoassets, this may include, but is not limited to, fraudulent investment schemes, phishing, Ponzi schemes and other forms of deception.

Restricted territories — jurisdictions or territories subject to sanctions restrictions, international restrictions or other legal prohibitions, as well as jurisdictions classified as having an increased level of risk in accordance with assessments by international organizations, including the Financial Action Task Force (FATF), including jurisdictions under enhanced monitoring or subject to other restrictions, as well as in accordance with the Company's internal AML/CTF procedures.

2. User Identity Verification (KYC)

2.1. The Company has the right to conduct User identity verification for the purpose of ensuring the security of the Service, preventing fraud, complying with applicable requirements and implementing internal AML/CTF procedures.
The User undertakes, at the Company's request, to undergo the verification procedure and provide the requested information and/or documents.
The Company has the right to request additional information and documents both as part of the general verification procedure and in relation to individual transactions, including if such transactions require additional verification based on the results of an internal risk assessment.
Verification may be conducted both in relation to the User and, where necessary, in relation to the sender and/or recipient of funds under the Application, as well as other persons involved in the transaction.
For the purpose of verifying the accuracy of information, the Company has the right to use third-party specialized KYC services and other verification tools.
Refusal to provide the requested information or documents may result in suspension, restriction or termination of services.

2.2. The verification procedure may include (but is not limited to):

• identity documents (for example, passport, ID card and other documents depending on the level of risk and applicable requirements);

• photo or video identification (selfie and other methods of identity confirmation);

• additional personal information (for example, telephone number, email address and other contact details);

• information and/or documents within the framework of Proof of Funds (PoF) procedures;

• information and/or documents within the framework of Source of Funds (SoF) procedures;

• additional information or materials relating to a specific transaction, where additional verification is required.

The requested information is used by the Company exclusively for the purposes of conducting verification, assessing risks and complying with internal AML/CTF procedures and applicable requirements.

2.3. Enhanced Verification (EDD)
In cases where, based on the results of an internal risk assessment, the User or transaction is classified as requiring additional verification, the Company has the right to apply enhanced due diligence procedures (EDD).
Within the EDD, the Company has the right to request additional information and/or documents, including but not limited to:

• information about the source of origin of funds (Source of Funds, SoF);

• information about the source of wealth (Source of Wealth, SoW);

• information about the income level;

• information about the nature of economic activity;

• supporting documents, where necessary.

Refusal to provide the requested information within the framework of EDD may result in suspension, restriction or termination of services.

3. Verification and Monitoring Procedures

3.1. The Company applies a system for monitoring transactions and User activity for the purpose of identifying operations potentially related to money laundering, terrorist financing, circumvention of sanctions restrictions and other unlawful activities.
Monitoring is carried out using a combination of blockchain analytics tools and internal control procedures.
The assessment of transactions and User activity is carried out on the basis of a risk-based approach and takes into account a combination of factors, including but not limited to:

• geographical risks;

• the presence of links to sanctioned entities, addresses or services;

• use of obfuscation tools (including mixers, bridges and other technologies);

• behavioral and transactional patterns;

• other signs indicating an increased level of risk.

The assessment is carried out taking into account the combination of factors and is not based exclusively on data from individual analytical tools.
The Company draws Users' attention to the fact that a preliminary risk assessment of a transaction does not guarantee its subsequent acceptance or successful crediting of funds. A low level of risk or absence of high-risk labels does not exclude the need for additional verification. The final assessment of the transaction is carried out after the actual receipt of funds and taking into account the combination of risk factors, including the results of internal monitoring and applicable control procedures.
The Company has the right to conduct additional verification of transactions regardless of the preliminary risk assessment.
3.2. The Company monitors transactions and User activity for the purpose of identifying operations that may indicate an increased level of risk. For these purposes, the Company uses blockchain transaction analysis tools and other specialized AML/CTF solutions provided by independent analytical providers with a professional reputation and recognized in the market. Such tools may be used jointly or separately.
The results of risk assessment obtained using third-party analytical tools may differ depending on the methodologies used, data sources and time of analysis. Accordingly, the results of a preliminary check conducted by the User using other services are not binding on the Company and do not predetermine the results of the internal risk assessment.
Within the framework of this Policy, a “suspicious operation” means a transaction or combination of transactions which, based on the results of the analysis, may indicate an increased likelihood of money laundering, terrorist financing, circumvention of sanctions restrictions or other unlawful activity, including but not limited to the following indicators:

• connection with assets which, according to available data, may have been obtained as a result of unlawful activity or are used for the purpose of concealing their origin;

• signs indicating possible attempts to circumvent accounting or control requirements;

• absence of an obvious economic or lawful purpose of the operation;

• connection with activities showing signs of fraud, money laundering, terrorist financing, corruption, violation of sanctions restrictions or other high-risk categories.

3.3. In the event of identification of an increased level of risk based on the results of an internal assessment or where there are signs indicating a possible connection of the transaction with unlawful activity (including, but not limited to, the categories Dark Market,Sanctions, Stolen funds, Scam and other high-risk categories), the Company has the right to apply control measures, including:

• suspension of transaction processing or restriction of access to funds until completion of the verification;

• requesting additional information and documents from the User, including identity documents, confirmation of wallet ownership and other information relating to the transaction;

• requesting documents and information within the framework of Proof of Funds (PoF) and Source of Funds (SoF), Enhanced Due Diligance (EDD) procedures;

• conducting additional verification in relation to the User, sender, recipient of funds or other persons associated with the transaction;

• refusal to perform the operation, including withdrawal of funds to third parties, in cases provided for by the Company's internal procedures and applicable requirements.

In the event of failure to provide the requested information or absence of a response from the User, the Company has the right to maintain restrictions in relation to the relevant funds until the verification is completed or a decision is made in accordance with internal procedures.
The verification period is generally up to 12 (twelve) business days from the moment all necessary information is provided, but may be extended depending on the complexity of the verification and the need for additional analysis.
Funds whose operations are restricted due to applicable sanctions or legal restrictions may remain blocked until the relevant restrictions are removed or another decision is made within the framework of applicable requirements.
The Company has the right to make a final decision based on the results of the verification conducted and on the basis of the combination of risk factors.

3.4. The Company completes the exchange transaction based on the results of the necessary verification and risk assessment procedures, including but not limited to

• completion by the User of identification and verification procedures in accordance with this Policy and internal AML/CTF procedures;

• assessment of transaction risks, including analysis of a possible connection with high-risk sources, sanctions restrictions, darknet platforms, stolen funds, fraudulent activity and other risk factors;

• verification of documents and information provided by the User, including identification data and, where necessary, additional materials relating to the transaction, including within the framework of Proof of Funds (PoF) and Source of Funds (SoF) procedures.

The Company has the right to suspend or refuse to complete the operation in the event of failure to pass the specified checks, identification of an increased level of risk or failure to provide the necessary information.

4. Restricted Territories and Sanctions

The Company does not provide services to persons located, residing or otherwise connected with jurisdictions subject to sanctions restrictions, international restrictions or other applicable legal prohibitions.
The Company also has the right to restrict or terminate the provision of services to Users in cases where access to the Service is made from high-risk territories or territories subject to restrictions in accordance with the Company's internal AML/CTF procedures.
The Company does not provide services to persons included in applicable sanctions lists, including but not limited to the lists of:

• United Nations (UN);

• European Union (EU);

• U.S. Office of Foreign Assets Control (OFAC);

• UK Office of Financial Sanctions Implementation (OFSI);

• other competent authorities.

The Company regularly checks Users and transactions against sanctions lists and has the right to suspend, restrict or terminate the provision of services in the event of a sanctions risk being identified.

The Company has the right to restrict, reject, suspend, hold until completion of the verification or terminate the provision of services, as well as request additional information, documents or confirmations if there are reasonable grounds to believe that the User, a person acting on behalf of the User, or an operation associated with them may be directly or indirectly connected with the circumvention of sanctions, restrictive measures or other applicable requirements, including the use of alternative settlement mechanisms, intermediary schemes, compensation schemes, payment agents, netting mechanisms or other structures intended to carry out international settlements in circumvention of applicable restrictions.
The Company reserves the right to apply additional verification measures to operations which, by their nature, structure, method of execution or involved parties, may indicate an increased risk of circumvention of sanctions restrictions or use of prohibited international settlement mechanisms.

5. Detection and Reporting of Suspicious Activity

The Company monitors transactions and User activity for the purpose of identifying signs of suspicious activity. In the event of signs of suspicious activity being identified, the Company conducts an internal review and, where there are grounds, makes a decision on further response in accordance with internal procedures and applicable requirements. The Company has the right to submit information about suspicious operations to competent authorities in the cases and manner provided for by applicable law. As part of the review, the Company has the right to request additional information and/or documents from the User, as well as apply control measures, including suspension of operations, restriction of access to funds or termination of services until completion of the review.

6. Restriction of Operations and Control Measures

For the purpose of complying with applicable AML/CTF requirements, preventing fraud and managing risks, the Company has the right to apply control measures in relation to User operations and funds when an increased level of risk, signs of suspicious activity or discrepancies in the information provided are identified.
Such cases may include, but are not limited to, operations related to high-risk sources, sanctioned entities or jurisdictions, darknet platforms, stolen funds, fraudulent activity and other risk factors defined by the Company's Policy.
The Company has the right to suspend operations, restrict access to funds, as well as conduct additional verification of the User, transaction or related persons until the necessary procedures are completed.

Completion of the operation or refund of funds is carried out based on the results of the verification conducted, including identification and verification of the User, as well as analysis of the information and documents provided. Funds in respect of which control measures have been applied may remain restricted until completion of the verification or a decision is made in accordance with the Company's internal procedures and applicable requirements.

7. Data Storage

The Company ensures the storage of documents and information obtained within the framework of AML/CTF procedures, including data provided by Users and the results of the verification conducted, for a period of at least 5 (five) years after termination of the business relationship with the User, unless a longer period is provided for by applicable requirements.
The Company collects, stores and protects Users' personal data in accordance with applicable data protection legislation requirements, as well as internal information security procedures.
Access to such data is restricted and is provided exclusively to authorized persons of the Company.
Information and documents may be disclosed to competent state authorities exclusively where there are legal grounds and in accordance with the procedure provided for by applicable requirements.

8. Policy Updates

The Company has the right from time to time to make amendments to this Policy for the purpose of reflecting changes in applicable requirements, as well as improving internal procedures. The updated version of the Policy is published on the Service with the date of the last amendment indicated. Such amendments shall enter into force upon their publication, unless otherwise provided by the relevant version of the Policy.

9. Contacts

For matters related to this Policy and the procedures applied, the User may contact the Company by email: [email protected] , as well as through the official Telegram channel of the Service.