Debut Limited (including any of our associated companies who may provide services via the Platform) (Debut or we or us) offers a Platform that enables users to earn returns on money they invest using the Platform. Debut converts your money into coins and tokens, and uses those coins and tokens to earn a return for you by entering into loans and other transactions using decentralised finance protocols and other selected providers.
Debut is registered as a financial service provider on the Financial Service Providers Register (FSP FSP1002438). Debut is not licensed by a New Zealand regulator to provide the Platform. Debut’s registration on the New Zealand register of financial service providers or membership of the Financial Services Complaints Limited does not mean that Debut is subject to active regulation or oversight by a New Zealand regulator.
This risk statement sets out additional information for users of the Platform. It is not comprehensive and other risks may apply. Further terms on which we provide the Platform are set out in the Debut Terms and Conditions (Terms). By accessing and using our services, you acknowledge having read this risk statement and agree to the Terms.
1. Debut does not offer a financial product and we are not an issuer or offeror of financial products for the purposes of the Financial Markets Conduct Act 2013 (FMC Act). Debut is not the provider of a regulated client money or property service, or a discretionary investment management service, for the purposes of the FMC Act.
2. Returns on your investment are not guaranteed. There is a risk that you could lose some or all of the money you have invested. Some, but not all, of the risks of investing using the Platform are set out below. Wherever possible Debut uses insurance provided by decentralised finance protocols to mitigate these risks. However, obtaining this insurance does not eliminate these risks as the insurance may not cover certain events or losses, and the decentralised finance protocols may themselves be subject to similar or other risks.
3. Any information on the Platform or website does not constitute financial advice for the purposes of the FMC Act. Nor do any statements on the Platform or Debut’s website take into account your personal financial circumstances and goals. You must carefully read all available information, including the risks set out below, and consider your personal financial circumstances before investing in the Platform. If you are unsure about any aspect of investing in the Platform or decentralised finance (DeFi), you should seek independent advice (legal, taxation, financial, technical or otherwise) before investing in the Platform.
4. We make no representation or warranty that the Platform and Debut’s website is appropriate or available for use in all countries or that the content satisfies the laws of all countries.
Support requests and complaints
5. If you have a request for support or a complaint, please refer to the processes set out in sections 14.1 and 17.1 of our Terms.
Some risks of using the Platform
6. When you invest using the Platform, Debut may acquire stablecoins for you to earn returns on your investment. Stablecoins are expected to have a relatively stable price, typically through being pegged to a commodity or currency or having their supply regulated by an algorithm. However, there is no guarantee that the price of a stablecoin will be maintained at any particular level. Where the price of a stablecoin is linked to a currency other than New Zealand dollars, or to a commodity that is not priced in New Zealand dollars, you will also be exposed to exchange rate risk, which is the risk that changes in the exchange rate between New Zealand dollars and the other currency reduce the New Zealand dollar value of those stablecoins.
7. Markets for the tokens and coins we acquire for you when you invest on the Platform have varying degrees of liquidity.
8. While there are active markets for the the tokens and coins we intend to acquire for investors using the Platform, there is always the risk that we may find it difficult or impossible to liquidate a position quickly at a reasonable price. This may arise from the risk that the markets which the tokens and coins currently appear on may disappear or be removed abruptly. If this occurs there may be delays, which may be significant, in paying your returns or any amounts you have requested to withdraw from the Platform. Liquidity issues could also result in the loss of some or all of the money you have invested.
Processing of transactions
9. There is a risk that transactions cannot be settled or are delayed at settlement, that processing times differ for each transaction, or a transaction may be incorrectly processed. These risks can result from, amongst other issues:
a) user error when providing transaction details (such as providing an incorrect bank account number or other information);
b) increases in the volume of investments, and / or withdrawal requests, on the Platform;
c) increases in the volume of transactions our third-party providers are experiencing;
d) or a failure in the Platform (see further information below at System risks and Technological risks that may affect our third-party providers), a failure in our third-party providers’ technology or systems, or a failure in an underlying network or software (including on DeFi platforms we earn yield from on your behalf).
10. It may not be possible to reverse a transaction once processing has commenced.
11. Debut’s technology is continuously being developed and the networks and software may be subject to technical weaknesses, bugs, system failures, and hacks by external parties. These failures may affect the Platform.
12. If we become aware of an attack, we will assess the best response on a case-by-case basis, which may include suspending transactions in relation to the Platform.
13. Hackers are sophisticated and you may also be targeted by ‘phishing’ attacks or other scams. Phishing includes where third parties masquerade as a legitimate Debut site, social media account, telephone support number or application in order to steal your credentials. You should only access the Platform through its official website (https://www.getdebut.app/) or approved mobile apps on App Store and Google Play Store. Never click on a link or download an application from a third party. We strongly recommend that you do not share your user details to prevent unauthorised account use. Your passwords should be unique to Debut and should never be stored insecurely on any personal device. If you are a victim of such an attack or scam, the hacker may be able to get you to send them money or your returns or your interests in the Platform.
14. Your ability to interact with the Platform may be affected by these technical failures or attacks either on the Platform, Debut application, Debut website, or our third-party providers’ systems and networks.
15. We will make reasonable efforts to notify users where the Debut application or website, or a particular transaction on the Debut application or website, has been subject to a technical weakness, bug, system failure, or hack.
16. We may also need to do maintenance or upgrades on the Debut application or website from time to time which could affect your ability to interact with the Platform.
Technological risks that may affect our third-party providers or decentralised finance protocols
17. It is important you understand the technological risks that may affect our third-party providers or the DeFi protocols we use as it may also affect the Platform.
18. While blockchain and DeFi bring about numerous benefits including transparency, data traceability, and flexibility, there is always the inherent risk that technology of any kind may contain weaknesses, vulnerabilities, or bugs causing, among other things, the complete failure of our third-party providers or the relevant DeFi protocols and/or their component parts.
19. Similar to us, our third-party providers and the DeFi protocols we use may also have risks including (but not limited to):
a) hardware and software vulnerabilities;
b) attacks against us as a user on their platforms (identity theft, malware, phishing, etc.);
c) malicious attacks on the smart contract infrastructure (i.e., a programmer who finds a vulnerability and uses it to break the protocol or steal from it); and
d) rare and critical surprise attacks on a system (e.g., where the attack is on collateral types that back the tokens and coins we hold on your behalf, or a large and unexpected price decrease of one or more collateral types).
20. In the worst-case scenario, all the coins or tokens held as collateral with a third party provider or in a DeFi protocol could be stolen with recovery being impossible. In this case, you may not get any returns from your investment in the Platform and we may not be able to return any money you have invested either.
Cyber security generally
21. The transmission of information over the internet (including to or from the Platform) is not completely secure or error free. You should stop transacting when it is clear there has been a breach of security or a system failure that poses a risk to security exists (such as malware, ransomware or phishing).
22. Debut does not offer or market regulated financial products or securities, or provide any form of licensed or specifically regulated service under the FMC Act Therefore, the protections which apply to “regulated offers”, and licensed and regulated services under the FMC Act do not apply. General consumer protection law, and ‘fair dealing’ protections under the FMC Act may apply, however, to investing in the Platform, including the services provided by us and, to the extent such consumer laws do apply we do not seek to exclude any of your rights that we cannot by law exclude.
23. New or changing laws and regulations, or interpretations of existing laws and regulations, in relation to tokens and coins, DeFi, blockchain and related products and technologies, may adversely impact or significantly change your returns from investing in the Platform, or whether you will receive back all the money you have invested.
24. Users are responsible for ensuring they comply with all laws that may affect them regarding their investment on the Platform.
25. If you are outside of New Zealand you may be subject (or we may become subject) to laws or regulations of other countries which could prevent you from investing in the Platform or cause us to change the availability of the Platform in your country or how we operate or offer the Platform.
26. There is no ready market on which you can sell your interest in the investments you have made with Debut. However, you may withdraw your returns in the form of New Zealand dollars (NZD) on making a request to us. We may ask you to provide additional information or give confirmations or declarations before we transfer the associated amounts from our custodial account to your designated bank account.
27. We are not responsible for any loss of value that arises from delays in transferring your returns (in the form of NZDs) to you.
Tax treatment and accounting
28. Your investment, and any returns you receive may be subject to the tax laws of New Zealand and other jurisdictions. You are solely responsible for understanding how your activities in relation to the Platform will be taxed under the laws applicable to you.
29. Coins, tokens and DeFi are fast-developing and evolving asset classes and technology. As such, there are things we cannot predict at this point in time, including risks that may be associated with the Platform or third-parties we work with.
30. Debut and any person associated with us (including directors, shareholders, employees and any other related parties) may trade and hold interests in the types of coins and tokens we acquire for you via the Platform, either on their own account or through the Platform