Risk Disclosure

1. Principal Loss Risk

All investments carry risk of loss, including total loss of principal. you may lose some or all of your invested capital. There is no guarantee that your investment will maintain its value, generate returns, or recover from losses. Market volatility can lead to significant losses in short periods. Diversification and values alignment do not eliminate the fundamental risk that your portfolio value may decline substantially.

Cryptocurrency investments, in particular, are subject to extreme price volatility and may experience rapid and substantial value declines. Historical performance data, backtesting results, and projections do not guarantee future results and should not be relied upon as indicators of future performance. you could lose your entire investment within a short timeframe due to market crashes, technical failures, or other unforeseen events.

2. Market Risk and Volatility

Financial markets are inherently volatile and unpredictable. Asset prices can fluctuate dramatically in response to economic conditions, geopolitical events, regulatory changes, market sentiment, macroeconomic indicators, and factors beyond anyone's control or prediction. Even well-diversified portfolios can experience significant losses during market downturns, financial crises, or periods of heightened volatility.

Cryptocurrency markets exhibit particularly extreme volatility, with the potential for rapid, substantial price swings within short timeframes. Market conditions can change rapidly and without warning. Past stability does not predict future stability. Diversification across assets, sectors, or themes does not eliminate market risk and may not protect against losses during widespread market declines. Systematic risks affecting entire markets cannot be diversified away.

3. Algorithmic and Model Risk

Our proprietary quantitative engine ("Quant Engine") employs automated algorithms and mathematical models to manage portfolios. While designed and backtested for optimal performance, these algorithms are subject to inherent limitations and risks: (a) Model Risk: Algorithms are based on historical data and assumptions that may not hold true in future market conditions or unprecedented scenarios; (b) Unexpected Behavior: Algorithms may behave unexpectedly or produce unintended results in novel market scenarios, extreme conditions, or black swan events not encountered during development or backtesting; (c) Technical Failures: Software bugs, coding errors, or system malfunctions could result in incorrect trades, missed opportunities, or financial losses; (d) Data Dependency: Algorithm performance depends on data quality and availability; inaccurate, incomplete, delayed, or corrupted data can lead to suboptimal decisions or significant losses; (e) Overfitting Risk: Backtested performance may reflect overfitting to historical data rather than genuine predictive power, leading to poor real-world performance.

Algorithmic trading does not guarantee profits, reduce losses, or eliminate investment risk. Algorithm performance may deteriorate over time as market dynamics evolve, rendering previously successful strategies ineffective. We reserve the right to modify, update, or replace algorithms, which may affect portfolio performance without prior notice. There is no guarantee that algorithmic management will outperform manual investment strategies or market benchmarks.

4. Concentration and Values Alignment Risk

Values-aligned investing based on inclusion or exclusion themes may result in concentrated positions in specific sectors, industries, geographies, or asset types. Concentration increases portfolio risk because poor performance in concentrated areas will have a disproportionate negative impact on overall returns. If sectors you support underperform or sectors you exclude outperform, your portfolio may significantly underperform broader market indices or non-aligned portfolios.

Values alignment does not enhance returns and may reduce returns or increase volatility compared to unconstrained portfolios. The narrower your investment universe due to values preferences, the higher your concentration risk. Limiting investment options based on ethical or values criteria necessarily reduces diversification opportunities. you explicitly accept this increased risk in exchange for values alignment. Sector-specific downturns, regulatory changes affecting particular industries, or shifts in market sentiment toward certain themes can disproportionately harm values-aligned portfolios.

5. Regulatory and Legal Risk

The financial services and cryptocurrency industries are subject to extensive and evolving regulation. Changes in laws, regulations, or regulatory interpretation in France, the European Union, or other jurisdictions where we or your assets are located could: (a) restrict or prohibit certain investment activities or asset types; (b) impose new compliance requirements, operational restrictions, or licensing obligations that affect our ability to operate; (c) result in forced liquidation of positions, account freezes, or asset seizures; (d) increase costs, reduce investment opportunities, or render our business model economically unviable; (e) subject you to unexpected tax liabilities or reporting obligations.

Anelio is currently in development and does not yet hold all regulatory licenses that may be required to offer services in all jurisdictions. Regulatory approvals are subject to uncertainty and may be denied, delayed, or granted with conditions. We may be required to restrict or cease operations in certain jurisdictions, potentially limiting your access to your account or forcing liquidation of positions at unfavorable prices. you are responsible for ensuring that your use of our Platform complies with applicable laws in your jurisdiction. Cryptocurrency regulations are particularly uncertain and subject to rapid change globally.

6. Technology and Cybersecurity Risk

Our Platform depends entirely on technology infrastructure, including servers, networks, third-party services, and internet connectivity. Technology risks include: (a) System Failures: Hardware failures, software bugs, network outages, or infrastructure problems may temporarily or permanently prevent access to your account, delay trade execution, or cause financial losses; (b) Cybersecurity Threats: Despite bank-grade security measures, no system is completely immune to cyberattacks, hacking, malware, phishing, denial-of-service attacks, ransomware, or other security breaches that could result in unauthorized access, data theft, manipulation of transactions, or financial loss; (c) Third-Party Dependencies: We rely on third-party service providers for critical functions including cloud hosting, payment processing, and data services; their failures, security breaches, or service interruptions could affect our services; (d) Cryptocurrency-Specific Risks: Risks inherent to blockchain technology, including smart contract vulnerabilities, network congestion, 51% attacks, hard forks, and irreversible transactions.

you acknowledge that technology failures may prevent you from accessing your account, executing trades, or withdrawing funds during critical periods, potentially resulting in significant financial losses. We are not liable for losses resulting from cyberattacks, system failures, or technology issues beyond our reasonable control. Digital wallets and cryptocurrency exchanges have been targeted by sophisticated cybercriminals, resulting in billions of dollars in losses historically.

7. Liquidity Risk

Liquidity refers to the ease with which assets can be bought or sold without significantly affecting their price. Liquidity risk arises when: (a) certain assets in your portfolio have limited trading volume, making it difficult to sell quickly without accepting substantial price discounts; (b) during market stress, crises, or panic selling, liquidity can evaporate rapidly, even for normally liquid assets; (c) cryptocurrency markets may experience periods of severely limited liquidity, particularly for smaller or less-established tokens; (d) market makers may withdraw from markets during volatile periods, creating liquidity voids; (e) regulatory actions or exchange failures may freeze trading in specific assets.

Illiquid positions may prevent or delay your ability to withdraw funds when desired. Forced liquidation during illiquid market conditions may result in selling assets at prices substantially below their fair value, locking in substantial losses. We do not guarantee the liquidity of any assets held in your portfolio. During extreme market events, liquidity can disappear entirely, making it impossible to exit positions at any price. Bid-ask spreads can widen dramatically, resulting in significant slippage and unfavorable execution prices.

8. Custody and Counterparty Risk

Your assets are held by third-party custodians, broker-dealers, and financial institutions with whom we maintain contractual relationships. you are exposed to counterparty risk, meaning: (a) if a custodian, broker, or counterparty experiences financial distress, insolvency, fraud, mismanagement, or operational failure, your assets may be at risk of loss, delay in recovery, or legal complications; (b) custodial arrangements may not provide complete protection in bankruptcy or insolvency proceedings, and you may become an unsecured creditor; (c) insurance coverage, if any, may be limited, insufficient to cover all losses, or subject to exclusions and limitations; (d) cross-border custody arrangements may involve additional legal complexity, jurisdictional risks, and enforcement challenges; (e) in cryptocurrency custody, private keys may be lost, stolen, or compromised.

While we select counterparties based on reputation and financial stability, we cannot guarantee their ongoing solvency, operational competence, or performance. In the event of custodian failure, you may experience significant delays, legal costs, and potential permanent losses in recovering your assets. Historical failures of cryptocurrency exchanges and custodians have resulted in complete loss of client funds. Recovery of assets from failed financial institutions can take years and may result in only partial recovery.

9. Tax and Accounting Risk

Investing through our Platform may have significant and complex tax consequences. Automated rebalancing and algorithmic trading can generate frequent taxable events, including: (a) capital gains or losses from asset sales, which may be short-term or long-term depending on holding periods; (b) ordinary income from certain cryptocurrency transactions, staking rewards, airdrops, or other distributions; (c) complex tax reporting requirements for cryptocurrency holdings, including tracking cost basis across multiple transactions; (d) potential wash sale rule implications if substantially identical positions are repurchased within 30 days; (e) varying tax treatment across jurisdictions, potentially including multiple countries if you move or hold assets internationally.

Tax laws are complex, jurisdiction-specific, and subject to change. Cryptocurrency taxation is particularly uncertain, with evolving guidance and potential retroactive rule changes. you are solely responsible for understanding, tracking, calculating, and paying all applicable taxes on your investment activities, including income tax, capital gains tax, wealth tax, and any other applicable taxes. We do not provide tax advice, tax reporting services, or comprehensive transaction records for tax purposes.

Failure to properly report and pay taxes can result in substantial penalties, interest charges, criminal prosecution, and legal consequences. Tax liabilities may significantly reduce your net investment returns. We strongly recommend consulting with a qualified tax professional who specializes in investment taxation and, if applicable, cryptocurrency taxation, regarding the tax implications of your investments before investing and on an ongoing basis.

10. Fee Impact on Returns

Our fee structure (0.8% annual management fee plus 30% performance fee on profits) will reduce your net returns, potentially substantially. The cumulative impact of fees over time compounds and can be significant: (a) Management fees are charged regardless of performance, reducing your portfolio value even during periods of loss or flat performance; (b) Performance fees mean you retain only 70% of gains while absorbing 100% of losses, creating an asymmetric return profile; (c) compounding effect of fees reduces long-term wealth accumulation substantially; fees reduce the base amount available for future growth; (d) in sideways or volatile markets with gains and losses, fees may exceed net gains, resulting in negative returns even if gross performance is flat or slightly positive; (e) recovery from losses requires higher percentage gains due to mathematical effects and ongoing fee drag.

For example, in a scenario where the gross portfolio return is 10%, after a 0.8% management fee and 30% performance fee, your net return is approximately 5.6%, representing a reduction of over 40% in your returns. Over multiple years, this fee impact compounds significantly. you should carefully consider whether our fee structure is appropriate for your investment goals and compare it to alternative investment options, including passive index funds with lower fees, which may provide superior after-fee returns, especially in lower-return environments.

11. no Guarantees or Warranties

Anelio makes no representations, warranties, or guarantees regarding: (a) investment returns, performance, or preservation of capital; (b) the accuracy, completeness, or reliability of historical performance data, projections, estimates, or forecasts; (c) the suitability of our services for your particular financial situation, investment objectives, or risk tolerance; (d) the achievement of any specific financial goals or outcomes; (e) the effectiveness, performance, or reliability of our algorithms or investment strategies; (f) the elimination, reduction, or mitigation of investment risk through values alignment, diversification, or algorithmic management.

All projections, estimates, hypothetical scenarios, and backtested performance data are for illustrative purposes only and should not be relied upon as indicative, predictive, or representative of future results. Backtested and hypothetical performance has inherent limitations: it does not reflect actual trading, transaction costs, market impact, or the effect of economic and market factors on decision-making. Past performance is not indicative of future results and may not be repeated. There is no assurance that future performance will match, approximate, or exceed historical results.

Investment results will vary. Each investor's experience will differ based on timing of investments, market conditions, fee impacts, selected values preferences, and individual circumstances. Some investors may experience gains while others experience losses, even with identical strategies, due to timing differences and market volatility.

12. Your Responsibility and Acknowledgment

By using our Platform, you acknowledge, understand, and accept that: (a) you are solely responsible for your investment decisions and their consequences, including all gains and losses; (b) you must evaluate whether our services are appropriate for your financial situation, risk tolerance, investment experience, investment objectives, time horizon, and overall financial circumstances; (c) you should consult with qualified financial, legal, and tax advisors before investing; (d) you understand all risks disclosed in this document and accept full responsibility for any losses, including total loss of invested capital; (e) you are investing only funds that you can afford to lose completely without jeopardizing your financial well-being, ability to meet current and future financial obligations, or standard of living.

Important: If you do not fully understand these risks, do not have the financial capacity to absorb potential losses, are uncomfortable with the level of risk involved, or cannot afford to lose your investment, you should not use our Platform. Do not invest money you cannot afford to lose. Do not invest borrowed funds. Do not invest emergency savings or funds needed for near-term obligations.

This Risk Disclosure Statement does not describe all possible risks. Additional risks may exist that are not currently known, anticipated, or disclosed. New risks may emerge as markets evolve, technologies change, or regulatory environments shift. The nature and magnitude of risks can change over time.

you should carefully read and understand our Terms of Service, Privacy Policy, and all other documentation before using our Platform. If you have any questions about these risks or how they apply to your situation, please seek professional financial advice before investing.