Staking Risk Disclosure

Preface to the CBB: The text set out below is the disclosure that will be presented to each Client prior to opting into Staking Services. A Client must acknowledge having read and understood this disclosure (electronically) before any opt-in is processed. The disclosure will be made available in English and Arabic; the Arabic version will be a faithful translation of the English text and the English version will prevail in the event of any inconsistency.

Please read this Risk Disclosure carefully before opting into Staking Services. By opting in, you confirm that you have read it, that you understand the risks described, and that you accept them. If you do not understand any part of this disclosure, do not opt in and contact Rain Support before proceeding.

1. About this disclosure

This Risk Disclosure applies to the optional “Staking Services” made available by Rain Management W.L.L. (“Rain”, “we”, “us”) to eligible Clients of the Rain platform (the “Platform”). It supplements, and forms part of, the Rain User Agreement (the “User Agreement”) and the Staking Addendum. Capitalised terms used but not defined here have the meanings given to them in the User Agreement. References to “crypto asset” have the same meaning as in the User Agreement.

Staking Services allow you to participate in the consensus mechanism of a supported proof-of-stake blockchain network through your crypto asset held with Rain, and to receive a share of the rewards issued by that network, net of fees, while your crypto asset remains in custody with our qualified custodian, BitGo Trust Company, Inc. (“BitGo”).

2. What staking is — and what it is not

Staking is the on-chain process by which holders of a proof-of-stake crypto asset commit (“stake”) their tokens as economic collateral in support of a validator that participates in producing and validating new blocks on the underlying blockchain. The blockchain protocol issues rewards directly to the staked address. Rain’s role is to enable you to participate in this protocol-level mechanism through your account; Rain does not borrow your crypto asset, does not lend it, and does not pay you a return out of its own balance sheet.

Staking Services are NOT:

• A deposit, savings product, money-market product or any other type of deposit-like instrument.

• Guaranteed, insured, capital-protected, or backed by any government, central bank, deposit-protection scheme or similar arrangement.

• A fixed-return investment. The rewards you may receive are variable and determined by the underlying blockchain protocol; they may decrease, increase or stop entirely without notice.

• A collective investment scheme, fund, security or financial product issued by Rain.

3. Specific risks of using the Staking Services

Set out below are the principal risks of which you should be aware before opting in. The list is not exhaustive — staking crypto assets involves further risks not described here. You should consider seeking independent financial, legal and tax advice before opting in.

3.1 Market and price risk

The market price of any crypto asset is highly volatile and can fall significantly, including to zero, at any time. While your crypto asset is staked, it remains exposed to the market. You may lose some or all of the value of the underlying crypto asset, and any rewards earned may not offset such losses. Rain does not protect you against market or price risk.

3.2 Liquidity, bonding and unbonding risk

Each proof-of-stake network imposes its own protocol-level rules on when staked crypto asset starts earning rewards (the “bonding” or “warm-up” period) and on the time required to undelegate and regain freely transferable crypto asset after an unstake instruction (the “unbonding” or “cooldown” period). These periods are determined by the network, not by Rain, and may range from minutes to several weeks. During such periods you may be unable to sell, transfer or withdraw your crypto asset. Network rules and timings may change without notice.

3.3 Slashing risk

Some proof-of-stake networks impose a protocol-level penalty (commonly called “slashing”) on the staked crypto asset where the validator misbehaves (for example, by double-signing) or experiences extended downtime. Slashing reduces the on-chain balance of the staked address and is irreversible. Although Rain has contractual arrangements with BitGo providing for reimbursement of slashing penalties and missed rewards up to defined limits, those arrangements are capped and may not fully cover any loss. The residual risk of loss from slashing rests with you.

3.4 Validator failure and operational risk

Staking Services rely on the continuous operation of one or more validator nodes operated by professional validator operators contracted to BitGo. A validator may fail, be removed from the network, be subject to a cyber attack or otherwise underperform. This may reduce or eliminate rewards for the affected period and, in extreme cases, give rise to slashing (see 3.3).

3.5 Protocol, smart-contract and fork risk

Proof-of-stake protocols are subject to ongoing technical change, including hard forks, soft forks, parameter changes, validator-set changes and protocol upgrades. A change may alter or end the way rewards are calculated and paid, the way unbonding works, or the way slashing applies. Where staking is implemented through a smart contract (for example, deposit contracts on Ethereum), the contract may contain bugs. logic flaws or be subject to exploits that can result in partial or total loss of staked crypto asset. Rain does not control, and cannot be held responsible for, the operation of the underlying protocol.

3.6 Reward variability and no guarantee of return

Any reward rate (whether expressed as APY, APR or otherwise) shown to you in connection with Staking Services is indicative only and is determined by the underlying protocol. Actual rewards depend on factors including the total amount staked across the network, validator performance, transaction-fee activity on the network, the network’s issuance schedule, and the proportion of rewards retained by the validator and by Rain. Rewards may be lower than indicated, may vary over time, and may be zero. Past reward rates are not indicative of future rewards.

3.7 Custody risk

Your crypto asset remains in segregated custody with BitGo throughout the staking lifecycle. Custody is, however, dependent on BitGo continuing to operate and on the integrity of its systems and key-management arrangements. While BitGo is a qualified custodian and maintains insurance arrangements with respect to assets in custody, those arrangements are limited in scope and amount and may not cover all losses. Risks of custodian insolvency, operational failure or key compromise cannot be entirely eliminated.

3.8 Cybersecurity and operational risk at Rain

Notwithstanding the safeguards Rain maintains, the Platform, your account credentials, your authentication factors, and the systems used to instruct staking and unstaking transactions may be subject to cyber-attack, fraud, social-engineering attempts, or operational error. A successful attack or error could delay or prevent the execution of staking, unstaking or reward-distribution transactions, or otherwise affect your crypto asset.

3.9 Fees and changes to fees

Rain charges a fee (the “Staking Fee”) calculated as a percentage of the staking rewards generated on your staked crypto asset. The Staking Fee, together with the validator commission charged by the underlying validator operator, is deducted from gross protocol rewards before any amount is credited to you. The fee schedule applicable to each supported crypto asset is set out on the Platform and may be updated from time to time in accordance with the User Agreement, including, where applicable, on prior notice to you. Network/gas fees incurred to execute staking or unstaking transactions may also be deducted.

3.10 Regulatory risk

The legal and regulatory treatment of staking and of proof-of-stake crypto assets is evolving and varies across jurisdictions. Changes in applicable law or regulation — including determinations by the Central Bank of Bahrain or by other authorities in jurisdictions to which you are subject — may require Rain to modify, suspend, restrict or discontinue Staking Services, including with respect to specific crypto assets or specific Clients. Such changes may occur with limited or no notice.

3.11 Tax risk

Staking rewards, including any reimbursement of slashing penalties, may have tax consequences in your country of tax residence or other jurisdictions to which you are subject. You are solely responsible for determining and meeting any tax-reporting and payment obligations arising from your participation in Staking Services. Rain does not provide tax advice.

3.12 Suspension, restriction or discontinuation of the Service

Rain may, at its discretion and in accordance with the User Agreement, suspend, restrict, modify or discontinue Staking Services in whole or in part — including for specific crypto assets, specific validator operators, or specific Clients — for operational, security, commercial, risk-management or regulatory reasons. In such cases, the underlying network’s rules (including any applicable unbonding period) will continue to apply to the unwinding of your staked position.

4. Before you opt in — please consider

• Whether you understand how staking works on the relevant network, including its bonding period, unbonding period and any slashing regime.

• Whether you can afford to lose part or all of the crypto asset you intend to stake.

• Whether the duration of any unbonding period is acceptable given your liquidity needs.

• Whether you have considered the tax treatment of staking rewards in your jurisdiction.

• Whether you have considered alternatives to staking, including simply holding the crypto asset unstaked.

5. Important notices

• Staking Services are not available to U.S. persons or to residents of any other jurisdiction in which Rain does not offer the service. Eligibility is determined by Rain and may change.

• Staking is opt-in per crypto asset, per Client. Rain will not stake your crypto asset without your express instruction.

• This Risk Disclosure does not constitute, and must not be relied on as, financial, investment, legal or tax advice.

6. Client acknowledgement

By opting into Staking Services, you confirm that:

1. you have read and understood this Risk Disclosure and the Staking Addendum to the User Agreement;

2. you accept the risks described, including the risk that you may lose some or all of the crypto asset you stake and that rewards are variable and not guaranteed;

3. you are not a U.S. person and are not opting in on behalf of any U.S. person, and you are otherwise eligible under the User Agreement and applicable law;

4. you understand that staking and unstaking are subject to protocol-level bonding and unbonding periods and that during such periods you may not be able to sell, transfer or withdraw the affected crypto asset;

5. you are not relying on Rain for financial, investment, legal or tax advice in connection with Staking Services.

How to acknowledge: Acknowledgement is captured electronically on the Platform via the “I have read and accept the Staking Risk Disclosure” checkbox presented immediately before the first opt-in for each crypto asset. Acknowledgement is time-stamped, logged against your Client identifier, and reissued whenever this Risk Disclosure is materially updated.

Questions or complaints: If you have any questions about this Risk Disclosure or about Staking Services, please contact Rain Support.