Risk considerations

A token can change in value as its reference asset changes. The contractual structure also introduces reliance on the issuer and the arrangements used to maintain economic backing.

1:1 economic backing is not a promise of a stable token price, direct share ownership or elimination of counterparty risk. Read the instrument’s applicable terms as well as the product description.

Secondary-market liquidity determines whether a holder can sell and at what price. Prices may diverge from implied value, particularly outside reference-market hours.

Primary cash redemption requires separate approval and is not an available exit route for every secondary-market holder. Redemption also settles in cash, rather than the underlying security.

Wallet access, venue availability, integration correctness and timely multiplier updates affect the ability to use and value a holding. Incorrect instrument identifiers or stale valuation inputs can misstate exposure.

Canton issuance does not eliminate custody, reserve, operational or recovery risk. Review the applicable backing information, service terms and recovery procedures for your integration.

If a stock token becomes eligible collateral for a perp position, the holder would have both the stock exposure and the trading exposure. Both can move adversely together. Collateral discounts, concentration limits, maintenance margin and liquidation rules would determine the resulting trading capacity.

Those parameters remain to be specified for the planned integrated Margin Layer. Holding a token today does not guarantee future collateral eligibility.