Trading in the purchase, sale and conversion of virtual currency and digital tokens involve a number of risks. Risks include but are not limited to: (a) Lack of information: Failing disclosure requirements, it may be difficult to find reliable indications to understand the functioning, costs, value and risks of each type of virtual currency. (b) Lack of legal and contractual protection: purchase, exchange and use of virtual currencies are not supported by legal and/or contractual protection similar to that provided by legal tender transactions; virtual currency transactions are almost always technically irreversible. (c) Lack of regulation and supervision: Issuing and management of virtual currencies, including conversion into legal tender, are activities not subject to supervision by any other authority in Italy. (d) Lack of protection or guarantee of the deposits: in the case of fraudulent conduct, bankruptcy or interruption of trading platforms activity, there are no specific regulatory safeguards to cover the losses incurred. Similarly, virtual currency deposits held with third parties are not covered by traditional protection instruments such as Deposit Guarantee Schemes. (e) High volatility of the value and risk of loss: the value of virtual currencies is highly volatile, partly due to price formation mechanisms and the absence of a central authority to intervene in order to maintain their value. This may result in losses in the event of owning virtual currency. (f) Risk of use for criminal and illegal purposes 1: virtual currency networks can be used for transactions related to criminal activities, including money laundering to be avoided by adequate anti-money laundering measures; (g) Legal risk: Legal status of virtual currencies and specific digital tokens is uncertain. This may imply that possession or exchange in certain countries may be subject to expressing regulation, as well as prohibition by public authorities. (h) Market risk: The market for virtual currencies and cryptographic tokens is still new and uncertain. No one should invest funds in this market or speculate if not willing to make losses, or if not ready to lose the entire investment. (i) Counterparty risk: virtual currencies or digital tokens on deposit, including through the provision of third party services, entail custody risks. Such risks include security breaches, risk of loss, interruption of Exchanger operations (i.e. websites that allow virtual currencies to be exchanged for legal tender and vice versa or virtual currencies). End users are obliged to exercise all possible caution to avoid - or as far as possible eliminate - stocks of virtual currencies and digital tokens in the internal wallets made available by the exchange platforms. (j) Conversion, purchase and sale risks: in addition to liquidity risks, the values of virtual currencies and cryptographic tokens in any market are highly volatile and can change rapidly. Holders who exchange, buy or sell virtual currencies and digital tokens should pay particular attention to how the value can be affected by sudden changes or information. In addition, a Holder is exposed to the risk of not being able to convert virtual currencies and digital tokens into legal tender for a long period of time. (k) Liquidity risk: virtual currency and digital token markets have different levels of liquidity. Some are quite liquid, while others may be less liquid. The latter may amplify price volatility. Risks from letters a) to f) are highlighted by the Bank of Italy in the Communication already mentioned in this document dated 30 January 2015. See for further details the joint communication of the Bank of Italy and the Financial Intelligence Unit dated 30 January 2015 and the warning published jointly by ESMA, EBA and EIOPA on risks related to virtual currencies.