About this Summary 

NDAX Canada Inc. (“NDAX”, “we” and “our”) believes that our users should understand the crypto assets that they are able to trade and stake using our crypto trading platform (the “Platform”). One of the crypto assets we offer on the Platform is BERA. We created this summary to help you understand the basics of BERA as well as some of the risks involved in trading in BERA. While we tried to describe the key features of BERA, this summary isn’t meant to tell you everything you’d want to know before investing in BERA. You should also do your own research on BERA to make sure you are comfortable investing in it. 

Description of BERA 

History of BERA 

Berachain is a next-generation blockchain asset developed to revolutionize the intersection of decentralized finance and digital asset management. Launched in early 2023, Berachain was designed with a strong emphasis on security, scalability, and seamless integration with both traditional financial systems and emerging blockchain applications. The project has evolved through extensive research and active community engagement, with the development team leveraging advanced consensus algorithms and innovative technical solutions to overcome common blockchain limitations. Ongoing updates and community-driven enhancements continue to shape Berachain’s evolution, ensuring that it remains at the forefront of blockchain innovation. 

What is BERA used for 

Bera serves as the native utility token within its ecosystem, facilitating a range of functions that include powering transactions, paying network fees, and enabling decentralized governance. The token is integral to the operation of the Bera blockchain, where it is used not only as a medium of exchange but also as an incentive for network participants and validators. Additionally, Bera supports the execution of smart contracts and decentralized applications, fostering an environment that encourages innovation and active user engagement. 

How BERA works 

Bera operates on its proprietary blockchain, utilizing a hybrid consensus mechanism that blends elements of proof-of-stake with practical Byzantine fault tolerance to secure the network and achieve high throughput. This architecture enables rapid transaction processing and low fees, ensuring that Bera can be used efficiently for everyday transactions as well as for more complex decentralized applications. The system is designed to be both scalable and resilient, accommodating growth in network usage while maintaining the decentralization and security necessary to protect user assets. 

Risks 

Before entering into an agreement (a “Crypto Contract”) with NDAX to buy or sell any crypto assets through the Platform, it is important to understand the risks. This overview is a starting point for you to perform your own research prior to investing in a crypto asset. 

Like other crypto assets, there are some general risks associated with investing in BERA. Each of these risks are described in more detail in the Risk Statement provided to you at the time that you open your account with us and is also available online on the NDAX website and app. You should review the Risk Statement. 

Specific risks associated with BERA include significant market volatility, largely driven by early-stage speculative trading and potential token unlock events. Approximately 51% of the total token supply is held by insiders (including the team and private investors), which introduces a risk of governance manipulation and conflict of interest. For example, early insider selling—as was observed with core developers liquidating portions of their airdropped allocation—can cause severe price swings. Moreover, BERA’s value is intertwined with the stability of HONEY, Berachain’s overcollateralized stablecoin. Although HONEY employs dynamic minting rates, adjustable fees, and an emergency “Basket Mode” to maintain its peg, extreme market stress or rapid collateral devaluation could challenge its stability. Additionally, the innovative ProofofLiquidity mechanism, while designed to enhance network security and liquidity, introduces complexity that could harbor undiscovered technical vulnerabilities or integration risks within core DeFi applications (such as native DEX, lending, or perpetual trading platforms). Finally, the pseudonymous nature of Berachain’s founding team presents transparency concerns, which may increase uncertainty regarding the project’s long-term viability and potential conflicts of interest.  

While we have tried to describe the key risks associated with BERA here and in our Risk Statement, we emphasize that this Crypto Asset Statement is not exhaustive of all of the risks associated with trading in BERA. You should also do your own research on BERA to make sure you are comfortable investing in such a crypto asset. 

Regulatory Information  

Ndax is a registered investment dealer under securities legislation in all provinces and territories of Canada, and is a member of the Canadian Investment Regulatory Organization (CIRO) and of the Canadian Investor Protection Fund (CIPF). Ndax is offering Crypto Contracts in accordance with the terms of the Decision Document dated December 19, 2024 that we entered into with the Canadian securities regulators.  Any fiat currency held in user's accounts are protected by the CIPF's Investment Dealer Fund in accordance with its Coverage Policy. However, CIPF coverage does not extend to any virtual assets held in user's accounts. These assets are not eligible for deposit insurance or any protection from the Canada Deposit Insurance Corporation (CDIC) or CIPF. 

The statutory rights of action for damages and the right of rescission in the securities legislation of each province and territory of Canada would not apply in respect of a misrepresentation in this Crypto Asset Statement. 

Prior to offering a Crypto Contract on BERA, NDAX assesses whether BERA is a security and/or a derivative under the securities and derivatives laws of Canada. NDAX’s assessment includes a review of the history of BERA (such as how it was created and its governance structure), its characteristics, its market capitalization and any regulatory concern regarding BERA. Based on its assessment, NDAX concluded that BERA is not a security or a derivative. However, there is a risk that this conclusion could change in the future. In that case, NDAX may be required to halt or withdraw BERA from trading on the Platform and stop any future trading of Crypto Contracts based on BERA, and users holding BERA may be required to liquidate their positions, potentially at a significant loss. In this event, users holding positions in BERA will be notified via the Platform or other electronic means and advised of the options available to them and any applicable period to sell or withdraw their positions in BERA. 

No Canadian securities regulatory authority has expressed an opinion about BERA, including an opinion that BERA is not itself a security and/or derivative. 

Last Updated: March 4, 2025