White paper drafted under the European Markets in Crypto-Assets Regulation (EU) 2023/1114 for FFG FLJPFR9RS

The crypto-asset Tezos (XTZ) referred to in this white paper is a crypto-asset other than EMTs and ARTs, and is issued on multiple blockchain networks, namely Tezos (native) and Binance Smart Chain, as of 2026-01-08 and according to DTI FFG shown in F.14. The supply is uncapped and increases through the issuance of 80 XTZ per new block created on the Tezos network; the crypto-asset is native on Tezos and is represented on Binance Smart Chain under the BEP-20 standard. On Tezos (native), the first on-chain activity is dated 2018-06-30, with block hash BLSqrcLvFtqVCx8WSqkVJypW2kAVRM3eEj2BHgBsB6kb24NqYev, URL https://tzkt.io/1/implicit_operations/migrations, accessed date 2026-01-08. On Binance Smart Chain, the first on-chain activity is dated 2020-09-09, with transaction hash 0xd227391eefba7856f741c0c945f10812b6d5c445ce9be4606ba95f4f3e1f9b7c, URL https://bscscan.com/tx/0xd227391eefba7856f741c0c945f10812b6d5c445ce9be4606ba95f4f3e1f9b7c, accessed date 2026-01-08.

Tezos is a public blockchain protocol designed to support the execution of transactions and smart contracts and to enable protocol changes through an on-chain governance process. XTZ is the native crypto-asset of the Tezos network and is used to pay transaction fees and for operational interactions with the network, including participation in the consensus process. Holders may contribute to network operation by staking or delegating XTZ to network participants responsible for block creation and validation, and XTZ is also used within the protocol’s governance mechanism to participate in voting processes relating to protocol updates. The protocol operates under a proof-of-stake based consensus mechanism, and the supply of XTZ is increased through protocol-defined issuance associated with block production.

The crypto-asset does not grant any legally enforceable or contractual rights or obligations to its holders or purchasers. Any functionalities accessible through the underlying technology are purely technical or operational in nature and do not confer rights comparable to ownership, profit participation, governance, or similar entitlements known from traditional financial instruments.

As defined in Article 3(9) of Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on Markets in Crypto-Assets – amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937 – a utility token is “a type of crypto-asset that is only intended to provide access to a good or a service supplied by its issuer”. This crypto-asset does not qualify as a utility token, as its intended use goes beyond providing access to a good or service supplied solely by the issuer.

Crypto Risk Metrics GmbH is seeking admission to trading on Payward Global Solutions LTD ("Kraken") platform in the European Union in accordance with Article 5 of Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on Markets in Crypto-Assets, and amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937. The admission to trading is not accompanied by a public offer of the crypto-asset.

Crypto Risk Metrics GmbH is a technical service provider, which supports regulated entities in the fulfilment of their regulatory requirements. In this regard, Crypto Risk Metrics GmbH, among other services, acts as a data-provider for ESG data according to article 66 (5). Due to the regulations laid out in article 4 (7), 5 (4) and 66 (3) of the Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets, and amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937, Crypto Risk Metrics GmbH aims to provide central services for crypto-asset white papers.

Crypto Risk Metrics GmbH, founded in 2018 and based in Hamburg (HRB 154488), has undergone several strategic shifts in its business focus since incorporation. Due to these changes in business model and operational direction over time, the financial figures from earlier years are only comparable to a limited extent with the company’s current commercial activities. The present business model – centred around regulatory technology and risk analytics in the context of the MiCAR framework – has been established progressively and can be realistically considered fully operational since approximately 2024.

The company’s financial trajectory over the past three years reflects the transition from exploratory development toward market-ready product delivery. The profit and loss after tax for the last three financial years is as follows:

2024 (unaudited): negative EUR 50.891,81

2023 (unaudited): negative EUR 27.665,32

2022: EUR 104.283,00.

The profit in 2022 resulted primarily from legacy consulting activities, which were discontinued in the course of the company’s repositioning.

The losses in 2023 and 2024 result from strategic investments in the development of proprietary software infrastructure, regulatory frameworks, and compliance technology for the MiCAR ecosystem. During those periods, no substantial commercial revenues were expected, as resources were directed toward preparing the platform for regulated market entry.

A fundamental repositioning of the company occurred in 2023 and especially in 2024, when the focus shifted toward providing risk management, regulatory reporting, and supervisory compliance solutions for financial institutions and crypto-asset service providers. This marked a material shift in business operations and monetisation strategy.

Based on the current business development in Q4 2025, revenues exceeding EUR 550,000 are expected for the fiscal year 2025, with an anticipated net profit of approximately EUR 100,000. These figures are neither audited nor based on a finalized annual financial statement; they are derived from the company’s current pipeline, client development, and active commercial engagements. Accordingly, they are subject to future risks and market fluctuations.

With the regulatory environment now taking shape and the platform commercially validated, it is assumed that the effects of the strategic developments will continue to materialize in 2026. The company foresees further scalability of its technology and growing market demand for regulatory compliance tools in the European crypto-asset sector.

No public subsidies or governmental grants have been received to date; all operations have been financed through shareholder contributions and internally generated resources. Crypto Risk Metrics has never accepted any payments via Tokens from projects it has worked for and – due to the internal Conflicts of Interest Policy – never will.

Not applicable. The company has been established for more than three years and its financial condition over the past three years is provided in Part A.16 above.

Promotion and development of new technologies and applications, in particular in the areas of new open and decentralized software architectures; the primary focus, though not exclusively, is the promotion and development of the so-called Tezos protocol and the corresponding technologies, as well as the promotion and support of applications using the Tezos protocol; full description of purpose in accordance with the statutes.

Tezos Foundation does not have a parent company.

According to public information (source: https://docs.tezos.com/, accessed 2026-01-08), the Tezos project is a crypto-asset initiative concerned with the development and operation of the Tezos blockchain protocol, a public, open-source Layer 1 network designed to support decentralised applications and smart contracts. A distinguishing feature is its self-amending design: protocol upgrades are proposed, voted on, and activated through an on-chain governance process rather than through disruptive hard forks. From an architecture perspective, Tezos separates the node “shell” (networking and storage) from the “protocol” (economic and transaction logic), allowing upgrades to change system rules while keeping the surrounding infrastructure stable.

The XTZ crypto-asset functions as an element within this broader technical framework. It is used to pay transaction fees and execute smart-contract operations, and it is also used in the consensus process (Liquid Proof-of-Stake), where validators (“bakers”) and delegators lock tez to participate in block production and network security. XTZ holdings further serve as the basis for governance participation, enabling proposals and voting on protocol upgrades; the protocol tracks balances with high precision using “mutez” (one-millionth of a tez), and issuance follows an inflationary model without a fixed total supply limit.

The project does not involve the granting of ownership, profit-participation rights, or legal claims against the project entity or its contributors. Instead, it centres on the creation of a technical environment in which the XTZ crypto-asset may serve as a governance and utility input for certain protocol processes. The long-term evolution of the Tezos system, including the scope of available features, the decentralisation roadmap, validator-selection mechanisms, and the operational continuity of the infrastructure, may vary based on technical, economic, and regulatory considerations. All future developments remain subject to change.

This section provides an overview of the historical developments related to the Tezos (XTZ) crypto-asset and a description of planned or anticipated project milestones as publicly communicated. All forward-looking elements are subject to significant uncertainty. They do not constitute commitments, assurances, or guarantees, and may be modified, delayed, or discontinued at any time. The implementation of past milestones cannot be assumed to continue in the future, and future changes may have adverse effects for token holders.

There is a formally published roadmap for the Tezos (XTZ) crypto-asset and/or the Tezos protocol. Based on the official roadmap (sources: https://docs.tezos.com/, https://spotlight.tezos.com/tezos-x/; accessed 2026-01-08, 2025-01-08), several protocol upgrades, ecosystem initiatives, and crypto-asset-related developments have been communicated that affect the evolution of the Tezos protocol and the role of the Tezos (XTZ) crypto-asset.

Past milestones:

- Tezos Position Paper and Tezos White Paper Released (2014): Arthur Breitman released the Tezos Position and White Papers in 2014 under the pseudonym “L.M. Goodman,” describing the conceptual foundations of the protocol and its governance-driven upgrade approach.

- The Fundraiser (July 2017): Tezos held a massive crowdfunding event from July 1 to July 14, 2017, raising approximately $232 million in bitcoin and ether—the largest ICO at that time.

- Network Launch (2018): Following a period of corporate and legal disputes, the Tezos Mainnet officially launched in 2018.

- First On-Chain Upgrade - Athens (May 2019): This was the first time a blockchain protocol amended itself through a stakeholder vote, increasing gas limits and reducing the "roll" size for baking.

- Ithaca upgrade (April 2022): Tezos activated Tenderbake, described as a major consensus update intended to provide deterministic finality.

- Mumbai upgrade (March 2023): Tezos enabled Smart Rollups as a scaling-related feature and reduced block times to 15 seconds.

- Paris upgrade (June 2024): Tezos reduced block times to 10 seconds and activated a Data Availability Layer (DAL) component intended to support Smart Rollups scaling.

- Expanded interoperability (June 2025): The roadmap describes planned developments including a Michelson rollup, broader smart-contract language support (including JavaScript and TypeScript, with Python and Java described as being explored), and exploration of a RISC-V runtime for rollups as an alternative execution environment.

Future milestones:

- Canonical rollup convergence (expected 2026): The roadmap describes an expected convergence toward a single canonical rollup intended to handle most network activity, with a stated target performance level.

- Layer 1 specialization (expected 2026): The roadmap describes a proposed migration where user accounts and applications move to the canonical rollup, with Layer 1 focusing on consensus and settlement.

Note: All future milestones are subject to significant uncertainty, including but not limited to technical feasibility, regulatory developments, market adoption, and community governance decisions. The project may modify, delay, or discontinue any of these initiatives at any time. Past performance or implementation does not guarantee future success, and changes may materially affect the value or utility of the XTZ token for holders.

According to publicly available information found at https://archive.org/download/gov.uscourts.cand.319743/gov.uscourts.cand.319743.1.0.pdf (accessed on 2026-01-08), the XTZ crypto-asset has no maximum supply and is designed as an inflationary asset where the protocol issues new tokens as a reward for validators, with stakers earning rewards that may exceed the rate of new issuance while non-stakers experience dilution. The initial distribution of tokens occurred following a fundraiser held from July 1, 2017, to July 14, 2017, culminating in the network's launch on October 2, 2017. The genesis supply was established at approximately 763.31 million XTZ, allocated across the following categories: 607.49 million XTZ (79.50%) to ICO contributors, which included 30,317 participants; 10% of the total tokens (approximately 76.33 million XTZ) to the Tezos Foundation; 10% of the total tokens (approximately 76.33 million XTZ) to Dynamic Ledger Solutions (DLS), the founders' company; and 3.16 million XTZ (0.41%) to early backers and contractors.

The allocations to the Tezos Foundation and Dynamic Ledger Solutions were subject to a vesting schedule. These tokens vested over a four-year period, with public sources reviewed not specifying a specific cliff period or the portion unlocked at the TGE/genesis.

Note: While wallet-level token balances can be verified on-chain, allocations to specific persons or entities cannot be independently confirmed, as public blockchain addresses cannot be reliably attributed to identifiable natural or legal persons. Consequently, the precise economic influence of individual stakeholders cannot be determined. Token movements, changes in ownership, or internal re-allocations may occur without prior notice and could affect governance dynamics, market perceptions, or anticipated economic outcomes.

The purpose of seeking admission to trading is to enable the crypto-asset to be listed on a regulated platform in accordance with the applicable provisions of Regulation (EU) 2023/1114 and Commission Implementing Regulation (EU) 2024/2984. The white paper has been drawn up to comply with the transparency requirements applicable to trading venues.

The token is intended to be listed on the trading platform operated by Payward Global Solutions LTD ("Kraken"). Access to this platform depends on regional availability and user eligibility under Kraken’s terms and conditions. Investors should consult Kraken’s official documentation to determine whether they meet the requirements for account creation and token trading.

The costs involved in accessing the trading platform depend on the specific fee structure and terms of the respective crypto-asset service provider. These may include trading fees, deposit or withdrawal charges, and network-related gas fees. Investors are advised to consult the applicable fee schedule of the chosen platform before engaging in trading activities.

Not applicable, as this white paper is written to seek admission to trading, not for the initial offer to the public.

MiCAR-compliant crypto-asset service providers shall have strong measures in place in order to manage conflicts of interests. Due to the broad audience this white paper is addressing, potential investors should always check the conflicts-of-interest policy of their respective counterparty.

Crypto Risk Metrics GmbH has established, implemented, and documented comprehensive internal policies and procedures for the identification, prevention, management, and documentation of conflicts of interest in accordance with applicable regulatory requirements. These internal measures are actively applied within the organisation. For the purposes of this specific assessment and the crypto-asset covered by this white paper, a token-specific review has been conducted by Crypto Risk Metrics GmbH. Based on this individual review, no conflicts of interest relevant to this crypto-asset have been identified at the time of preparation of this white paper.

Not applicable, as this white paper is written to seek admission to trading, not for the initial offer to the public.

Not applicable, as this white paper is written to seek admission to trading, not for the initial offer to the public.

According to public information available in the official Tezos documentation (https://docs.tezos.com/, accessed 2026-01-08), the XTZ crypto-asset is the native crypto-asset of the Tezos blockchain and is intended to function as the primary on-chain economic and coordination mechanism within the Tezos protocol.

The XTZ crypto-asset is designed to facilitate on-chain governance of the Tezos protocol via its self-amending mechanism. Governance participation (via delegates) is proportional to voting power, which is determined by XTZ balances (tracked in protocol units), and is used to decide protocol amendments.

Within the Tezos network, XTZ is used to pay for computation and Tezos also applies burnt costs for storage consumption when operations increase smart contract storage, reflecting resource usage on the network. XTZ is further used as an economic security instrument in Tezos’ proof-of-stake design.

The XTZ token does not confer ownership, profit participation, governance rights over the issuer or any related entity, or any form of economic entitlement. All functionalities are technical in nature and relate exclusively to interactions within the Tezos protocol environment. The actual usability of XTZ depends on factors such as system stability, smart-contract execution, development progress, governance decisions, and the operational conditions of the Tezos blockchain, which are outside the control of token holders.

Future milestones:

- Canonical rollup convergence (expected 2026): The roadmap describes an expected convergence toward a single canonical rollup intended to handle most network activity, with a stated target performance level.

- Layer 1 specialization (expected 2026): The roadmap describes a proposed migration where user accounts and applications move to the canonical rollup, with Layer 1 focusing on consensus and settlement.

Note: All future milestones are subject to significant uncertainty, including but not limited to technical feasibility, regulatory developments, market adoption, and community governance decisions. The project may modify, delay, or discontinue any of these initiatives at any time. Past performance or implementation does not guarantee future success, and changes may materially affect the value or utility of the XTZ token for holders.

The crypto-asset referred to herein is a crypto-asset other than EMTs and ARTs, and is available on multiple networks. The crypto-asset is fungible up to 6 digits after the decimal point on Tezos and up to 18 digits after the decimal point on Binance Smart Chain. The crypto-asset constitutes a digital representation recorded on distributed-ledger technology and does not confer ownership, governance, profit participation, or any other legally enforceable rights. Any functionalities associated with the token are limited to potential technical features within the relevant platform environment. These functionalities do not represent contractual entitlements and may depend on future development decisions, technical design choices, and operational conditions. The crypto-asset does not embody intrinsic economic value; instead, its value, if any, is determined exclusively by market dynamics such as supply, demand, and liquidity in secondary markets.

No such services are currently known to be provided by the issuer. However, it cannot be excluded that additional services exist or may be offered in the future outside the scope of Regulation (EU) 2023/1114.

The crypto-asset does not grant any legally enforceable or contractual rights or obligations to its holders or purchasers.

Any functionalities accessible through the underlying technology are of a purely technical or operational nature and do not constitute rights comparable to ownership, profit participation, governance, or similar entitlements known from traditional financial instruments.

Accordingly, holders do not acquire any claim capable of legal enforcement against the issuer or any third party.

As the crypto-asset does not establish any legally enforceable rights or obligations, there are no applicable procedures or conditions for their exercise.

Any interaction or functionality that may be available within the technical infrastructure of the project – such as participation mechanisms or protocol-level features – serves operational purposes only and does not create or constitute evidence of any contractual or statutory entitlement.

As the crypto-asset does not confer any legally enforceable rights or obligations, there are no conditions or mechanisms under which such rights could be modified.

Adjustments to the technical protocol, smart contract logic, or related systems may occur in the ordinary course of development or maintenance.

Such changes do not alter the legal position of holders, as no contractual or regulatory rights exist. Holders should not interpret technical updates or governance-related changes as amendments to legally binding entitlements.

Information on the future offers to the public of crypto-assets were not available at the time of writing this white paper (2026-01-08).

The crypto-assets themselves are not subject to any technical or contractual transfer restrictions and are generally freely transferable. However, crypto-asset service providers may impose restrictions on buyers or sellers in accordance with applicable laws, internal policies or contractual terms agreed with their clients.

The XTZ crypto-asset is designed as an inflationary crypto-asset with no maximum supply. Investors should note that changes in the supply of the crypto-asset can have a negative impact.

This white paper is submitted in the context of an application for admission to trading on a trading platform established in the European Union. Accordingly, this white paper shall be governed by the laws of the Federal Republic of Germany.

Any disputes arising in relation to this white paper or the admission to trading may fall under the jurisdiction of of the competent courts in Hamburg, Germany.

The crypto-asset in scope is implemented on the Tezos blockchain and Binance Smart Chain networks following the standards described below.

The crypto-asset in scope is implemented on the Tezos blockchain and Binance Smart Chain networks following the standards described below.

The following applies to Tezos:

1. Core building blocks

- Self‑amending governance – on‑chain upgrade process (no hard‑forks).

- Liquid Proof‑of‑Stake (LPoS) – validators = bakers; delegation allowed.

- Baking – block creation/validation.

- Accusers – monitor & denounce malicious bakers.

- Smart Rollups – L2 execution while preserving L1 security.

- Data Availability Layer (DAL) – decentralized storage for rollup data.

- Michelson – stack‑based language for formally verified contracts.

- Tezos Improvement Process (TZIP) – proposal system for new standards.

- FA1.2 / FA2 – token standards (fungible & multi‑asset).

- Tenderbake – consensus upgrade delivering deterministic finality.

- Tickets – native on‑chain assets/permissions.

2. Units

- Tez (ꜩ) – native token.

- XTZ – market ticker.

- Mutez – 1 µtez = 10⁻⁶ tez (1 tez = 1 000 000 mutez).

- Cent – 0.01 tez (historical term).

- Rolls – legacy measure of baking/voting power (10 000 → 8 000 tez, now replaced by mutez).

3. Address prefixes

- tz1, tz2, tz3 – Implicit (user) accounts; Created with Ed25519, Secp256k1, etc.

- tz4 – Native multisig / BLS accounts; Introduced in Seoul; uses BLS signatures.

- KT1 – Originated (smart‑contract) accounts; Store immutable code + mutable storage.

- sr1 – Smart‑Rollup identifiers; Not accounts; cannot hold tez.

The following applies to Binance Smart Chain:

Binance Smart Chain (BSC) is a Layer-1 blockchain that utilizes a Proof-of-Staked Authority (PoSA) consensus mechanism. This mechanism combines elements of Proof-of-Authority (PoA) and Proof-of-Stake (PoS) and is intended to secure the network and validate transactions. In PoSA, validators are selected based on their stake and authority, with the goal of providing fast transaction times and low fees while maintaining network security through staking.

The crypto-asset in scope is implemented on the Tezos blockchain and Binance Smart Chain networks following the standards described below.

The following applies to Tezos:

Ledger & account model

Maintenance – full node stores blockchain + current ledger (account balances).

Account types –

- Implicit (tz1‑tz4) – hold tez + tickets.

- Originated (KT1) – hold tez, tickets, immutable code, mutable storage.

- Smart‑Rollup (sr1) – not accounts; cannot store tez.

Constraints – non‑native tokens (FA1.2/FA2) are kept in contract‑internal ledgers; user accounts stay unrevealed until first transaction.

Custody assumptions – private‑key control; address = hash of public key; wallets manage keys; native multisig requires multiple signatures.

Cost model – transaction fees (native token) & storage fees (ꜩ1/byte); fees destroyed, can be prepaid for users (post‑Kathmandu).

The following applies to Binance Smart Chain:

1. BSC-Compatible Wallets

Tokens on BSC are supported by wallets compatible with the Ethereum Virtual Machine (EVM), such as MetaMask. These wallets can be configured to connect to the BSC network and are designed to interact with BSC using standard Web3 interfaces.

2. Ledger

BSC maintains its own decentralized ledger for recording token transactions. This ledger is intended to ensure transparency and security, providing a verifiable record of all activities on the network.

3. BEP-20 Token Standard

BSC supports tokens implemented under the BEP-20 standard, which is tailored for the BSC ecosystem. This standard is designed to facilitate the creation and management of tokens on the network.

4. Scalability and Transaction Efficiency

BSC is designed to handle high volumes of transactions with low fees. It leverages its PoSA consensus mechanism to achieve fast transaction times and efficient network performance, making it suitable for applications requiring high throughput.

The crypto-asset in scope is implemented on the Tezos blockchain and Binance Smart Chain networks following the standards described below.

The following applies to Tezos:

Algorithm – Liquid Proof‑of‑Stake (LPoS) with Tenderbake finality.

Validators (bakers) – run a node, baker daemon, and DAL node; create, sign, propose, attest blocks.

Selection & power – baking power = owned + staked tez + delegated tez (delegated tez weighted 1/3). Minimum baking power = 6 000 tez.

Security deposit – 10 % of stake frozen; slashing forfeits deposit.

Infrastructure – must stay online; inactivity → lost rewards/temporary exclusion.

Delegation & staking – delegation keeps funds liquid (no slashing risk); staking locks funds (rewards + slashing risk).

Governance – self‑amending on‑chain process with 5 periods (proposal → adoption); voting power = total mutez owned + delegated (no weighting). Super‑majority (≈80 %) & quorum required.

The following applies to Binance Smart Chain:

Binance Smart Chain (BSC) uses a hybrid consensus mechanism called Proof of Staked Authority (PoSA), which combines elements of Delegated Proof of Stake (DPoS) and Proof of Authority (PoA). This method ensures fast block times and low fees while maintaining a level of decentralization and security. Core Components

1. Validators (so-called “Cabinet Members”): Validators on BSC are responsible for producing new blocks, validating transactions, and maintaining the network’s security. To become a validator, an entity must stake a significant amount of BNB (Binance Coin). Validators are selected through staking and voting by token holders. There are 21 active validators at any given time, rotating to ensure decentralization and security.

2. Delegators: Token holders who do not wish to run validator nodes can delegate their BNB tokens to validators. This delegation helps validators increase their stake and improves their chances of being selected to produce blocks. Delegators earn a share of the rewards that validators receive, incentivizing broad participation in network security.

3. Candidates: Candidates are nodes that have staked the required amount of BNB and are in the pool waiting to become validators. They are essentially potential validators who are not currently active but can be elected to the validator set through community voting. Candidates play a crucial role in ensuring there is always a sufficient pool of nodes ready to take on validation tasks, thus maintaining network resilience and decentralization. Consensus Process

4. Validator Selection: Validators are chosen based on the amount of BNB staked and votes received from delegators. The more BNB staked and votes received, the higher the chance of being selected to validate transactions and produce new blocks. The selection process involves both the current validators and the pool of candidates, ensuring a dynamic and secure rotation of nodes.

5. Block Production: The selected validators take turns producing blocks in a PoA-like manner, ensuring that blocks are generated quickly and efficiently. Validators validate transactions, add them to new blocks, and broadcast these blocks to the network.

6. Transaction Finality: BSC achieves fast block times of around 3 seconds and quick transaction finality. This is achieved through the efficient PoSA mechanism that allows validators to rapidly reach consensus. Security and Economic Incentives

7. Staking: Validators are required to stake a substantial amount of BNB, which acts as collateral to ensure their honest behavior. This staked amount can be slashed if validators act maliciously. Staking incentivizes validators to act in the network's best interest to avoid losing their staked BNB.

8. Delegation and Rewards: Delegators earn rewards proportional to their stake in validators. This incentivizes them to choose reliable validators and participate in the network’s security. Validators and delegators share transaction fees as rewards, which provides continuous economic incentives to maintain network security and performance.

9. Transaction Fees: BSC employs low transaction fees, paid in BNB, making it cost-effective for users. These fees are collected by validators as part of their rewards, further incentivizing them to validate transactions accurately and efficiently.

The crypto-asset in scope is implemented on the Tezos blockchain and Binance Smart Chain networks following the standards described below.

The following applies to Tezos:

1. Rewards – paid in tez to bakers (block creation, attestation, DAL participation) and to stakers (pro‑rata to amount locked). Delegators may receive manual payouts.

2. Fees & costs – transaction fees payable in tez; storage fees = ꜩ1 per byte, destroyed upon deduction. Developers can pay storage on behalf of users.

3. Penalties / slashing – double‑baking or double‑attesting triggers slashing of the baker’s security deposit; delegated stake is slashed proportionally. Accusers submit denunciations and receive a portion of the slashed stake.

4. Issuance / inflation – 80 XTZ block reward; adaptive issuance ties inflation to the staked‑to‑total‑supply ratio (target ≈ 50 % staked). Liquidity baking mints a small amount each block into a CPMM contract for market liquidity. Inflation also funds protocol development via on‑chain invoices.

5. Burn / supply reduction – storage fees are destroyed; forfeited security deposits are removed from circulation; inactive‑address “destroy” clause revised to only suspend voting/staking rights (no permanent token loss).

The following applies to Binance Smart Chain:

Binance Smart Chain (BSC) uses the Proof of Staked Authority (PoSA) consensus mechanism to ensure network security and incentivize participation from validators and delegators. Incentive Mechanisms

1. Validators: Staking Rewards: Validators must stake a significant amount of BNB to participate in the consensus process. They earn rewards in the form of transaction fees and block rewards. Selection Process: Validators are selected based on the amount of BNB staked and the votes received from delegators. The more BNB staked and votes received, the higher the chances of being selected to validate transactions and produce new blocks.

2. Delegators: Delegated Staking: Token holders can delegate their BNB to validators. This delegation increases the validator's total stake and improves their chances of being selected to produce blocks. Shared Rewards: Delegators earn a portion of the rewards that validators receive. This incentivizes token holders to participate in the network’s security and decentralization by choosing reliable validators.

3. Candidates: Pool of Potential Validators: Candidates are nodes that have staked the required amount of BNB and are waiting to become active validators. They ensure that there is always a sufficient pool of nodes ready to take on validation tasks, maintaining network resilience.

4. Economic Security: Slashing: Validators can be penalized for malicious behavior or failure to perform their duties. Penalties include slashing a portion of their staked tokens, ensuring that validators act in the best interest of the network. Opportunity Cost: Staking requires validators and delegators to lock up their BNB tokens, providing an economic incentive to act honestly to avoid losing their staked assets. Fees on the Binance Smart Chain

5. Transaction Fees: Low Fees: BSC is known for its low transaction fees compared to other blockchain networks. These fees are paid in BNB and are essential for maintaining network operations and compensating validators. Dynamic Fee Structure: Transaction fees can vary based on network congestion and the complexity of the transactions. However, BSC ensures that fees remain significantly lower than those on the Ethereum mainnet.

6. Block Rewards: Incentivizing Validators: Validators earn block rewards in addition to transaction fees. These rewards are distributed to validators for their role in maintaining the network and processing transactions.

7. Cross-Chain Fees: Interoperability Costs: BSC supports cross-chain compatibility, allowing assets to be transferred between Binance Chain and Binance Smart Chain. These cross-chain operations incur minimal fees, facilitating seamless asset transfers and improving user experience.

8. Smart Contract Fees: Deployment and Execution Costs: Deploying and interacting with smart contracts on BSC involves paying fees based on the computational resources required. These fees are also paid in BNB and are designed to be cost-effective, encouraging developers to build on the BSC platform.

Not applicable, as the DLT is not operated by the issuer, the offeror, the person seeking admission to trading, or any third-party acting on their behalf.

Not applicable, as no comprehensive audit of the technology used has been conducted or can be confirmed.

1. Regulatory and Compliance

Regulatory frameworks applicable to crypto-asset services in the European Union and in third countries are evolving. Supervisory authorities may introduce, interpret, or enforce rules that affect (i) the eligibility of this crypto-asset for admission to trading, (ii) the conditions under which a crypto-asset service provider may offer trading, custody, or transfer services for it, or (iii) the persons or jurisdictions to which such services may be provided. As a result, the crypto-asset service provider admitting this crypto-asset to trading may be required to suspend, restrict, or terminate trading or withdrawals for regulatory reasons, even if the crypto-asset itself continues to function on its underlying network.

2. Trading venue and connection risk

Trading in the crypto-asset depends on the uninterrupted operation of the trading platform admitting it and, where applicable, on its technical connections to external liquidity sources or venues. Interruptions such as system downtime, maintenance, faulty integrations, API changes, or failures at an external venue can temporarily prevent order placement, execution, deposits, or withdrawals, even when the underlying blockchain is functioning. In addition, trading platforms in emerging markets may operate under differing governance, compliance, and oversight standards, which can increase the risk of operational failures or disorderly market conditions.

3. Market formation and liquidity conditions

The price and tradability of the crypto-asset depend on actual trading activity on the venues to which the service provider is connected, whether centralized exchanges (CEXs) or decentralized exchanges (DEXs). Trading volumes may at times be low, order books thin, or liquidity concentrated on a single venue. In such conditions, buy or sell orders may not be executed in full or may be executed only at a less favorable price, resulting in slippage.

Volatility: The market price of the crypto-asset may fluctuate significantly over short periods, including for reasons that are not linked to changes in the underlying project or protocol. Periods of limited liquidity, shifts in overall market sentiment, or trading on only a small number of CEXs or DEXs can amplify these movements and lead to higher slippage when orders are executed. As a result, investors may be unable to sell the crypto-asset at or close to a previously observed price, even though no negative project-specific event has occurred.

4. Counterparty and service-provider dependence

The admission of the crypto-asset to trading may rely on several external parties, such as connected centralized or decentralized trading venues, liquidity providers, brokers, custodians, or technical integrators. If any of these counterparties fail to perform, suspend their services, or apply internal restrictions, the trading, deposit, or withdrawal of the crypto-asset on the admitting service provider can be interrupted or halted.

Quality of counterparties: Trading venues and service providers in certain jurisdictions may operate under regulatory or supervisory standards that are lower or differently enforced than those applicable in the European Union. In such environments, deficiencies in governance, risk management, or compliance may remain undetected, which increases the probability of abrupt service interruptions, investigations, or forced wind-downs.

Delisting and service suspension: The crypto-asset’s availability may depend on the internal listing decisions of these counterparties. A delisting or suspension on a key connected venue can materially reduce liquidity or make trading temporarily impossible on the admitting service provider, even if the underlying crypto-asset continues to function.

Insolvency of counterparties: If a counterparty involved in holding, routing, or settling the crypto-asset becomes insolvent, enters restructuring, or is otherwise subject to resolution-type measures, assets held or processed by that counterparty may be frozen, become temporarily unavailable, or be recoverable only in part or not at all, which can result in losses for clients whose positions were maintained through that counterparty. This risk applies in particular where client assets are held on an omnibus basis or where segregation is not fully recognized in the counterparty’s jurisdiction.

5. Operational and information risks

Due to the irrevocability of blockchain transactions, incorrect approvals or the use of wrong networks or addresses will typically make the transferred funds irrecoverable. Because trading may also rely on technical connections to other venues or service providers, downtime or faulty code in these connections can temporarily block trading, deposits, or withdrawals even when the underlying blockchain is functioning. In addition, different groups of market participants may have unequal access to technical, governance, or project-related information, which can lead to information asymmetry and place less informed investors at a disadvantage when making trading decisions.

6. Market access and liquidity concentration risk

If the crypto-asset is only available on a limited number of trading platforms or through a single market-making entity, this may result in reduced liquidity, greater price volatility, or periods of inaccessibility for retail holders.

1. Insolvency of the issuer

As with any commercial entity, the issuer may face insolvency risks. These may result from insufficient funding, low market interest, mismanagement, or external shocks (e.g. pandemics, wars). In such a case, ongoing development, support, and governance of the project may cease, potentially affecting the viability and tradability of the crypto-asset.

2. Legal and regulatory risks

The issuer operates in a dynamic and evolving regulatory environment. Failure to comply with applicable laws or regulations in relevant jurisdictions may result in enforcement actions, penalties, or restrictions on the project’s operations. These may negatively impact the crypto-asset’s availability, market acceptance, or legal status.

3. Operational risks

The issuer may fail to implement adequate internal controls, risk management, or governance processes. This can result in operational disruptions, financial losses, delays in updating the white paper, or reputational damage.

4. Governance and decision-making

The issuer’s management body is responsible for key strategic, operational, and disclosure decisions. Ineffective governance, delays in decision-making, or lack of resources may compromise the stability of the project and its compliance with MiCA requirements. High concentration of decision-making authority or changes in ownership/control can amplify these risks.

5. Reputational risks

The issuer’s reputation may be harmed by internal failures, external accusations, or association with illicit activity. Negative publicity can reduce trust in the issuer and impact the perceived legitimacy or value of the crypto-asset.

6. Counterparty dependence

The issuer may depend on third-party providers for certain core functions, such as technology development, marketing, legal advice, or infrastructure. If these partners discontinue their services, change ownership, or underperform, the issuer’s ability to operate the project or maintain investor communication may be impaired. This could disrupt project continuity or undermine market confidence, ultimately affecting the crypto-asset’s value.

1. Valuation risk

The crypto-asset does not represent a claim, nor is it backed by physical assets or legal entitlements. Its market value is driven solely by supply and demand dynamics and may fluctuate significantly. In the absence of fundamental value anchors, such assets can lose their entire market value within a very short time. Historical market behaviour has shown that some types of crypto-assets – such as meme coins or purely speculative tokens – have become worthless. Investors should be aware that this crypto-asset may lose all of its value.

2. Market volatility risk

Crypto-asset prices can fluctuate sharply due to changes in market sentiment, macroeconomic conditions, regulatory developments, or technology trends. Such volatility may result in rapid and significant losses. Holders should be prepared for the possibility of losing the full amount invested.

3. Liquidity and price-determination risk

Low trading volumes, fragmented trading across venues, or the absence of active market makers can restrict the ability to buy or sell the crypto-asset. In such situations, it is not guaranteed that an observable market price will exist at all times. Spreads may widen materially, and orders may only be executable under unfavourable conditions, which can make liquidation costly or temporarily impossible.

4. Asset security risk

Loss or theft of private keys, unauthorised access to wallets, or failures of custodial or exchange service providers can result in the irreversible loss of assets. Because blockchain transactions are final, recovery of funds after a compromise is generally impossible.

5. Fraud and scam risk

The pseudonymous and irreversible nature of blockchain transactions can attract fraudulent schemes. Typical forms include fake or unauthorised crypto-assets imitating established ones, phishing attempts, deceptive airdrops, or social-engineering attacks. Investors should exercise caution and verify the authenticity of counterparties and information sources.

6. Legal and regulatory reclassification risk

Legislative or regulatory changes in the European Union or in the Member State where the crypto-asset is admitted to trading may alter its legal classification, permitted uses, or tradability. In third countries, the crypto-asset may be treated as a financial instrument or security, which can restrict its offering, trading, or custody.

7. Absence of investor protection

The crypto-asset is not covered by investor-compensation or deposit-guarantee schemes. In the event of loss, fraud, or insolvency of a service provider, holders may have no access to recourse mechanisms typically available in regulated financial markets.

8. Counterparty risk

Reliance on third-party exchanges, custodians, or intermediaries exposes holders to operational failures, insolvency, or fraud of these parties. Investors should conduct due diligence on service providers, as their failure may lead to the partial or total loss of held assets.

9. Reputational risk

Negative publicity related to security incidents, misuse of blockchain technology, or associations with illicit activity can damage public confidence and reduce the crypto-asset’s market value.

10. Community and sentiment risk

Because the crypto-asset’s perceived relevance and expected future use depend largely on community engagement and the prevailing sentiment, a loss of public interest, negative coverage or reduced activity of key contributors can materially reduce market demand.

11. Macroeconomic and interest-rate risk

Fluctuations in interest rates, exchange rates, general market conditions, or overall market volatility can influence investor sentiment towards digital assets and affect the crypto-asset’s market value.

12. Taxation risk

Tax treatment varies across jurisdictions. Holders are individually responsible for complying with all applicable tax laws, including the reporting and payment of taxes arising from the acquisition, holding, or disposal of the crypto-asset.

13. Anti-money-laundering and counter-terrorist-financing risk

Wallet addresses or transactions connected to the crypto-asset may be linked to sanctioned or illicit activity. Regulatory responses to such findings may include transfer restrictions, report obligations, or the freezing of assets on certain venues.

14. Market-abuse risk

Due to limited oversight and transparency, crypto-assets may be vulnerable to market-abuse practices such as spoofing, pump-and-dump schemes, or insider trading. Such activities can distort prices and expose holders to sudden losses.

15. Legal ownership and jurisdictional risk

Depending on the applicable law, holders of the crypto-asset may not have enforceable ownership rights or effective legal remedies in cases of disputes, fraud, or service failure. In certain jurisdictions, access to exchanges or interfaces may be restricted by regulatory measures, even if on-chain transfer remains technically possible.

16. Concentration risk

A large proportion of the total supply may be held by a small number of holders. This can enable market manipulation, governance dominance, or sudden large-scale liquidations that adversely affect market stability, price levels, and investor confidence.

As this white paper relates to the admission to trading of the crypto-asset, the following risk description reflects general implementation risks on the crypto-asset service provider's side typically associated with crypto-asset projects. The party admitting the asset to trading is not involved in the project’s implementation and does not assume responsibility for its governance, funding, or execution.

Delays, failures, or changes in the implementation of the project as outlined in its public roadmap or technical documentation may negatively impact the perceived credibility or usability of the crypto-asset. This includes risks related to project governance, resource allocation, technical delivery, and team continuity.

Key-person risk: The project may rely on a limited number of individuals for development, maintenance, or strategic direction. The departure, incapacity, or misalignment of these individuals may delay or derail the implementation.

Timeline and milestone risk: Project milestones may not be met as announced. Delays in feature releases, protocol upgrades, or external integrations can undermine market confidence and affect the adoption, use, or value of the crypto-asset.

Delivery risk: Even if implemented on time, certain functionalities or integrations may not perform as intended or may be scaled back during execution, limiting the token’s practical utility.

As this white paper relates to the admission to trading of the crypto-asset, the following risks concern the underlying distributed ledger technology (DLT), its supporting infrastructure, and related technical dependencies. Failures or vulnerabilities in these systems may affect the availability, integrity, or transferability of the crypto-asset.

1. Blockchain dependency risk

The functionality of the crypto-asset depends on the continuous and stable operation of the blockchain(s) on which it is issued. Network congestion, outages, or protocol errors may temporarily or permanently disrupt on-chain transactions. Extended downtime or degradation in network performance can affect trading, settlement, or usability of the crypto-asset.

2. Smart contract vulnerability risk

The smart contract that defines the crypto-asset’s parameters or governs its transfers may contain coding errors or security vulnerabilities. Exploitation of such weaknesses can result in unintended token minting, permanent loss of funds, or disruption of token functionality. Even after external audits, undetected vulnerabilities may persist due to the immutable nature of deployed code.

3. Wallet and key-management risk

The custody of crypto-assets relies on secure private key management. Loss, theft, or compromise of private keys results in irreversible loss of access. Custodians, trading venues, or wallet providers may be targeted by cyberattacks. Compatibility issues between wallet software and changes to the blockchain protocol (e.g. network upgrades) can further limit user access or the ability to transfer the crypto-asset.

Outdated or vulnerable wallet software:

Users relying on outdated, unaudited, or unsupported wallet software may face compatibility issues, security vulnerabilities, or failures when interacting with the blockchain. Failure to update wallet software in line with protocol developments can result in transaction errors, loss of access, or exposure to known exploits.

4. Network security risks

Attack Risks: Blockchains may be subject to denial-of-service (DoS) attacks, 51% attacks, or other exploits targeting the consensus mechanism. These can delay transactions, compromise finality, or disrupt the accurate recording of transfers.

Centralization Concerns: Despite claims of decentralisation, a relatively small number of validators or a high concentration of stake may increase the risk of collusion, censorship, or coordinated network downtime, which can affect the resilience and operational reliability of the crypto-asset.

5. Bridge and interoperability risk

Where tokens can be bridged or wrapped across multiple blockchains, vulnerabilities in bridge protocols, validator sets, or locking mechanisms may result in loss, duplication, or misrepresentation of assets. Exploits or technical failures in these systems can instantly impact circulating supply, ownership claims, or token fungibility across chains.

6. Forking and protocol-upgrade risk

Network upgrades or disagreements among node operators or validators can result in blockchain “forks”, where the blockchain splits into two or more incompatible versions that continue separately from a shared past. This may lead to duplicate token representations or incompatibilities between exchanges and wallets. Until consensus stabilises, trading or transfers may be disrupted or misaligned. Such situations may be difficult for retail holders to navigate, particularly when trading platforms or wallets display inconsistent token information.

7. Economic-layer and abstraction risk

Mechanisms such as gas relayers, wrapped tokens, or synthetic representations may alter the transaction economics of the underlying token. Changes in transaction costs, token demand, or utility may reduce its usage and weaken both its economic function and perceived value within its ecosystem.

8. Spam and network-efficiency risk

High volumes of low-value (“dust”) or automated transactions may congest the network, slow validation times, inflate ledger size, and raise transaction costs. This can impair performance, reduce throughput, and expose address patterns to analysis, thereby reducing network efficiency and privacy.

9. Front-end and access-interface risk

If users rely on centralised web interfaces or hosted wallets to interact with the blockchain, service outages, malicious compromises, or domain expiries affecting these interfaces may block access to the crypto-asset, even while the blockchain itself remains fully functional. Dependence on single web portals introduces a critical point of failure outside the DLT layer.

10. Decentralisation claim risk

While the technical infrastructure may appear distributed, the actual governance or economic control of the project may lie with a small set of actors. This disconnect between marketing claims and structural reality can lead to regulatory scrutiny, reputational damage, or legal uncertainty – especially if the project is presented as ‘community-governed’ without substantiation.

Tezos is present on the following networks: Binance Smart Chain, Tezos.

Binance Smart Chain (BSC) uses a hybrid consensus mechanism called Proof of Staked Authority (PoSA), which combines elements of Delegated Proof of Stake (DPoS) and Proof of Authority (PoA). This method ensures fast block times and low fees while maintaining a level of decentralization and security.

Core Components:

1. Validators (so-called “Cabinet Members”): Validators on BSC are responsible for producing new blocks, validating transactions, and maintaining the network’s security. To become a validator, an entity must stake a significant amount of BNB (Binance Coin). Validators are selected through staking and voting by token holders. There are 21 active validators at any given time, rotating to ensure decentralization and security.

2. Delegators: Token holders who do not wish to run validator nodes can delegate their BNB tokens to validators. This delegation helps validators increase their stake and improves their chances of being selected to produce blocks. Delegators earn a share of the rewards that validators receive, incentivizing broad participation in network security.

3. Candidates: Candidates are nodes that have staked the required amount of BNB and are in the pool waiting to become validators. They are essentially potential validators who are not currently active but can be elected to the validator set through community voting. Candidates play a crucial role in ensuring there is always a sufficient pool of nodes ready to take on validation tasks, thus maintaining network resilience and decentralization. Consensus Process

4. Validator Selection: Validators are chosen based on the amount of BNB staked and votes received from delegators. The more BNB staked and votes received, the higher the chance of being selected to validate transactions and produce new blocks. The selection process involves both the current validators and the pool of candidates, ensuring a dynamic and secure rotation of nodes.

5. Block Production: The selected validators take turns producing blocks in a PoA-like manner, ensuring that blocks are generated quickly and efficiently. Validators validate transactions, add them to new blocks, and broadcast these blocks to the network.

6. Transaction Finality: BSC achieves fast block times of around 3 seconds and quick transaction finality. This is achieved through the efficient PoSA mechanism that allows validators to rapidly reach consensus. Security and Economic Incentives

7. Staking: Validators are required to stake a substantial amount of BNB, which acts as collateral to ensure their honest behavior. This staked amount can be slashed if validators act maliciously. Staking incentivizes validators to act in the network's best interest to avoid losing their staked BNB.

8. Delegation and Rewards: Delegators earn rewards proportional to their stake in validators. This incentivizes them to choose reliable validators and participate in the network’s security. Validators and delegators share transaction fees as rewards, which provides continuous economic incentives to maintain network security and performance.

9. Transaction Fees: BSC employs low transaction fees, paid in BNB, making it cost-effective for users. These fees are collected by validators as part of their rewards, further incentivizing them to validate transactions accurately and efficiently.

Tezos operates on a Liquid Proof of Stake (LPoS) consensus mechanism, which combines flexibility in staking participation with an on-chain governance model.

Core Components:

Liquid Proof of Stake (LPoS) Tezos allows token holders to participate in staking by either directly staking their tokens or delegating them to a validator (known as a baker) without transferring ownership. Validators (bakers) are responsible for creating new blocks (baking) and endorsing other blocks for validation. Bakers and Endorsers Bakers are selected based on the amount of XTZ (Tezos tokens) staked or delegated to them. The more XTZ staked, the higher the probability of being chosen to bake or endorse blocks. Endorsers are randomly selected from a pool of bakers to validate and approve blocks baked by other bakers. This additional validation enhances network security. Self-Amendment and Governance Tezos’s unique governance model allows token holders to propose, vote on, and implement network upgrades without requiring hard forks. This self-amendment protocol enables Tezos to evolve based on community and developer input, making it highly adaptable and flexible.

Tezos is present on the following networks: Binance Smart Chain, Tezos.

Binance Smart Chain (BSC) uses the Proof of Staked Authority (PoSA) consensus mechanism to ensure network security and incentivize participation from validators and delegators.

Incentive Mechanisms

1. Validators:

- Staking Rewards: Validators must stake a significant amount of BNB to participate in the consensus process. They earn rewards in the form of transaction fees and block rewards.

- Selection Process: Validators are selected based on the amount of BNB staked and the votes received from delegators. The more BNB staked and votes received, the higher the chances of being selected to validate transactions and produce new blocks.

2. Delegators:

- Delegated Staking: Token holders can delegate their BNB to validators. This delegation increases the validator's total stake and improves their chances of being selected to produce blocks.

- Shared Rewards: Delegators earn a portion of the rewards that validators receive. This incentivizes token holders to participate in the network’s security and decentralization by choosing reliable validators.

3. Candidates:

Pool of Potential Validators: Candidates are nodes that have staked the required amount of BNB and are waiting to become active validators. They ensure that there is always a sufficient pool of nodes ready to take on validation tasks, maintaining network resilience.

4. Economic Security:

- Slashing: Validators can be penalized for malicious behavior or failure to perform their duties. Penalties include slashing a portion of their staked tokens, ensuring that validators act in the best interest of the network.

- Opportunity Cost: Staking requires validators and delegators to lock up their BNB tokens, providing an economic incentive to act honestly to avoid losing their staked assets.

Fees on the Binance Smart Chain

1. Transaction Fees:

- Low Fees: BSC is known for its low transaction fees compared to other blockchain networks. These fees are paid in BNB and are essential for maintaining network operations and compensating validators.

- Dynamic Fee Structure: Transaction fees can vary based on network congestion and the complexity of the transactions. However, BSC ensures that fees remain significantly lower than those on the Ethereum mainnet.

2. Block Rewards:

Incentivizing Validators: Validators earn block rewards in addition to transaction fees. These rewards are distributed to validators for their role in maintaining the network and processing transactions.

3. Cross-Chain Fees:

Interoperability Costs: BSC supports cross-chain compatibility, allowing assets to be transferred between Binance Chain and Binance Smart Chain. These cross-chain operations incur minimal fees, facilitating seamless asset transfers and improving user experience.

4. Smart Contract Fees:

Deploying and interacting with smart contracts on BSC involves paying fees based on the computational resources required. These fees are also paid in BNB and are designed to be cost-effective, encouraging developers to build on the BSC platform.

Tezos incentivizes network participation and security through baking rewards, transaction fees, and an inflationary reward model.

Incentive Mechanisms:

Rewards for Baking and Endorsing Bakers receive XTZ rewards for baking new blocks. Endorsers, who validate and approve blocks baked by others, are also rewarded in XTZ. These rewards encourage active participation and help secure the network. Delegation Incentives XTZ holders who do not wish to bake can delegate their tokens to a baker, earning a share of the baker’s rewards without directly participating. This delegation option broadens participation, making it accessible to more users, thereby enhancing overall network security. Security Deposit Requirement Bakers are required to post a bond (security deposit) in XTZ to bake blocks, which is held as collateral to prevent dishonest actions. If a baker acts maliciously, they risk forfeiting this bond, creating a disincentive for bad behavior and aligning bakers’ interests with network integrity.

Applicable Fees:

Transaction Fees Users pay transaction fees in XTZ for activities such as transferring funds and interacting with smart contracts. These fees are awarded to bakers and endorsers, providing them with an additional incentive to validate and secure the network. Inflationary Reward Model Tezos has an inflationary reward system, where new XTZ tokens are periodically created and distributed as rewards to bakers and endorsers. This model encourages continuous participation but gradually increases the XTZ supply, balancing network security and token availability over time.

The energy consumption of this asset is aggregated across multiple components:

For the calculation of energy consumptions, the so called 'bottom-up' approach is being used. The nodes are considered to be the central factor for the energy consumption of the network. These assumptions are made on the basis of empirical findings through the use of public information sites, open-source crawlers and crawlers developed in-house. The main determinants for estimating the hardware used within the network are the requirements for operating the client software. The energy consumption of the hardware devices was measured in certified test laboratories. When calculating the energy consumption, we used - if available - the Functionally Fungible Group Digital Token Identifier (FFG DTI) to determine all implementations of the asset of question in scope and we update the mappings regulary, based on data of the Digital Token Identifier Foundation. The information regarding the hardware used and the number of participants in the network is based on assumptions that are verified with best effort using empirical data. In general, participants are assumed to be largely economically rational. As a precautionary principle, we make assumptions on the conservative side when in doubt, i.e. making higher estimates for the adverse impacts.

To determine the energy consumption of a token, the energy consumption of the underlying blockchain networks is calculated first. A proportionate share of that energy use is then attributed to the token based on its activity level within the network (e.g. transaction volume, contract execution).

The Functionally Fungible Group Digital Token Identifier (FFG DTI) is used to determine all technically equivalent implementations of the crypto-asset in scope.

Estimates regarding hardware types, node distribution, and the number of network participants are based on informed assumptions, supported by best-effort verification against available empirical data. Unless robust evidence suggests otherwise, participants are assumed to act in an economically rational manner. In line with the precautionary principle, conservative estimates are applied where uncertainty exists – that is, estimates tend towards the higher end of potential environmental impact.

To determine the proportion of renewable energy usage, the locations of the nodes are to be determined using public information sites, open-source crawlers and crawlers developed in-house. If no information is available on the geographic distribution of the nodes, reference networks are used which are comparable in terms of their incentivization structure and consensus mechanism. This geo-information is merged with public information from Our World in Data, see citation. The intensity is calculated as the marginal energy cost wrt. one more transaction. Ember (2025); Energy Institute - Statistical Review of World Energy (2024) - with major processing by Our World in Data. “Share of electricity generated by renewables - Ember and Energy Institute” [dataset]. Ember, “Yearly Electricity Data Europe”; Ember, “Yearly Electricity Data”; Energy Institute, “Statistical Review of World Energy” [original data]. Retrieved from https://ourworldindata.org/grapher/share-electricity-renewables.

To determine the GHG Emissions, the locations of the nodes are to be determined using public information sites, open-source crawlers and crawlers developed in-house. If no information is available on the geographic distribution of the nodes, reference networks are used which are comparable in terms of their incentivization structure and consensus mechanism. This geo-information is merged with public information from Our World in Data, see citation. The intensity is calculated as the marginal emission wrt. one more transaction. Ember (2025); Energy Institute - Statistical Review of World Energy (2024) - with major processing by Our World in Data. “Carbon intensity of electricity generation - Ember and Energy Institute” [dataset]. Ember, “Yearly Electricity Data Europe”; Ember, “Yearly Electricity Data”; Energy Institute, “Statistical Review of World Energy” [original data]. Retrieved from https://ourworldindata.org/grapher/carbon-intensity-electricity Licenced under CC BY 4.0.