Sonic (S) - Crypto Asset Statement
PLEASE READ THIS CAREFUL. BY PROCEEDING TO TRANSACT S, YOU ACKNOWLEDGE AND ACCEPT THE STATEMENTS SET OUT BELOW
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 Sonic (S). We created this summary to help you understand the basics of S as well as some of the risks involved in trading in S. While we tried to describe the key features of S, this summary isn’t meant to tell you everything you’d want to know before investing in S. You should also do your own research on S to make sure you are comfortable investing in it.
Description of Sonic (S)
History of Sonic
Sonic (Prev. FTM) is a DeFi project conceptualized and created by the Fantom Foundation established by the renowned South Korean computer scientist Dr. Ahn Byung Ik. This futuristic project aims to provide a platform for developers to build scalable, secure, and super fast decentralized applications for the DeFi ecosystem using smart contracts. To achieve this, the development team built their own consensus mechanism called the aBFT.
The team released the testnet in 2018 and raised $40 million through token sales to fund the project development. Following this, the Fantom mainnet was launched in 2019.
What is Sonic (S) used for
As the native utility and governance token of the Fantom network, S is used for payments, rewards, and fees. Through a process of staking, the token is also used to secure the network and to make governance decisions for the future of the protocol.
S is currently available as an ERC-20 and BEP-20 token.
How Sonic (S) works
Sonic (S) (Prev. Fantom) was built to overcome the shortcomings of popular blockchain networks like Ethereum. The network congestion and high gas fees due to the proof-of-work consensus on Ethereum have made it harder for DeFi to go mainstream. Recognizing this, Sonic (S) Fantom created an independent and decentralized DAG-based network for decentralized apps (dApps).
An asynchronous, non-deterministic algorithm called Lachesis powers the Fantom mainnet and facilitates the creation and use of smart contracts through the Ethereum Virtual Machine (EVM). The advantage of a DAG chain is that it makes the network fully independent. This means that the network congestion in one part does not affect the working of the rest of the chain. dApps built on Fantom can benefit from this feature, being able to create their own blockchain networks with governance rules and tokenomics of their choice.
S is also responsible for securing the network through a proof-of-stake system. Apart from this, the token is used to pay the fees for all types of transactions on Fantom. Users can also stake S tokens to vote on platform governance decisions.
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 S. We describe many of these general risks in the risk statement we publish on our website that you have already acknowledged, including risks relating to: (i) short history; (ii) volatility in the price of crypto assets and loss of liquidity; (iii) potential decrease in global demand for crypto assets; (iv) The blockchains on which crypto assets operate may temporarily or permanently fork or halt; airdrops; (v) issues with the cryptography underlying the Crypto networks; (vi) custodial wallet systems; (vii) uncertainty in regulation and future financial institution support; (viii) currency risks; (ix) concentration risks; (x) electronic trading and dependence on the internet; (xi) cyber security risks; (xii) inadequate due diligence; (xiii) Ndax’s reliance on vendors and third-party service providers; (xiv) liquidity constraints; (xv) no voting rights; (xvi) lack of investor protection insurance; (xvii) commissions and other charges for trading; (xviii) no advise; (xix) transfers; (xx) beta features; (xxi) unforeseeable risks; and (xxii) conflicts of interest. We also point out a risk that is specific to S below. While we tried to describe the key risks associated with S here and in our risk statement, these aren’t all of the risks associated with trading in S. You should also do your own research on S to make sure you are comfortable investing in it.
Adoption Risk
The success of Fantom is predicated on developers choosing to build and use Fantom-native applications. There is significant competition between crypto asset networks seeking to offer smart contract platforms for decentralized applications. The price of S is likely to decline in the long run if constructive and meaningful applications are not created, supported and used on Fantom.
Conflict of Interest Disclosure
Ndax has assessed potential conflicts of interest associated with the offering, and ongoing availability of S through the Platform. As of the date of this statement, Ndax has not identified any actual, material, or reasonably foreseeable conflict of interest that would be expected to impair our ability to act in the best interests of clients or to make fair, objective, and independent decisions regarding S. Ndax maintains policies and procedures designed to identify, manage, and address conflicts of interest on an ongoing basis and will update our disclosures if any material conflict is identified in the future. For additional information about the material conflicts of interest identified by us, please refer to our Conflicts of Interest Statement, the latest version of which can be found on our Website.
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 reliance on a prospectus exemption contained in the exemptive relief decision Re Ndax Canada Inc. dated December 19, 2024 (found {here}) and under the terms and conditions imposed by CIRO on Ndax’s membership with CIRO (found {here}). Any fiat currency held in users’ accounts is protected by CIPF’s Investment Dealer Fund in accordance with its Coverage Policy. However, CIPF coverage does not extend to any virtual assets held in users accounts. These assets are not eligible for deposit insurance or any protection from the Canada Deposit Insurance Corporation (CDIC) or CIPF.
Please be aware that the statutory rights of action for damages and the right of rescission in the securities legislation of each province and territory of Canada do not apply in respect of a misrepresentation in this Crypto Asset Statement.
Prior to offering a Crypto Contract on S, Ndax assesses whether S 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 S (such as how it was created and its governance structure), its characteristics, its market capitalization and any regulatory concern regarding S. Based on its assessment, Ndax concluded that S 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 S from trading on the Platform and stop any future trading of Crypto Contracts based on S, and users holding S may be required to liquidate their positions, potentially at a significant loss. In this event, users holding positions in S 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 S.
No Canadian securities regulatory authority has expressed an opinion about S, including an opinion that S is not itself a security and/or derivative.
Last Updated: August 18, 2026