Risks

YOU ACKNOWLEDGE AND AGREE THAT THERE ARE NUMEROUS RISKS ASSOCIATED WITH ACQUIRING SFTY, HOLDING SFTY, AND USING SFTY FOR PARTICIPATION IN STELLA FANTASY. IN THE WORST SCENARIO, THIS COULD LEAD TO THE LOSS OF ALL OR PART OF SFTY HELD. IF YOU DECIDE TO ACQUIRE SFTY OR PARTICIPATE IN STELLA FANTASY, YOU EXPRESSLY ACKNOWLEDGE, ACCEPT AND ASSUME THE FOLLOWING RISKS:

· Uncertain Regulations and Enforcement Actions: The regulatory status of Stella Fantasy, SFTY and distributed ledger technology is unclear or unsettled in many jurisdictions. The regulation of digital assets has become a primary target of regulation in all major countries in the world. It is impossible to predict how, when or whether regulatory agencies may apply existing regulations or create new regulations with respect to such technology and its applications, including SFTY and/or Stella Fantasy. Regulatory actions could negatively impact SFTY and/or Stella Fantasy in various ways. The Company, the Distributor (or their respective affiliates) may cease operations in a jurisdiction in the event that regulatory actions, or changes to law or regulation, make it illegal to operate in such jurisdiction, or commercially undesirable to obtain the necessary regulatory approval(s) to operate in such jurisdiction. After consulting with a wide range of legal advisors to mitigate the legal risks as much as possible, the Company and Distributor have obtained a legal opinion on the token distribution, and will be conducting business in accordance with the prevailing market practice.

· Inadequate disclosure of information: As at the date hereof, Stella Fantasy is still under development and its design concepts, consensus mechanisms, algorithms, codes, and other technical details and parameters may be constantly and frequently updated and changed. Although this Litepaper contains the most current information relating to Stella Fantasy, it is not absolutely complete and may still be adjusted and updated by the Stella Fantasy team from time to time. The Stella Fantasy team has no ability and obligation to keep holders of SFTY informed of every detail (including development progress and expected milestones) regarding the project to develop Stella Fantasy, hence insufficient information disclosure is inevitable and reasonable.

· Competitors: Various types of decentralised applications and networks are emerging at a rapid rate, and the industry is increasingly competitive. It is possible that alternative networks could be established that utilise the same or similar code and protocol underlying SFTY and/or Stella Fantasy and attempt to re-create similar facilities. Stella Fantasy may be required to compete with these alternative networks, which could negatively impact SFTY and/or Stella Fantasy.

· Loss of Talent: The development of Stella Fantasy greatly depends on the continued co-operation of the existing technical team and expert consultants, who are highly knowledgeable and experienced in their respective sectors. The loss of any member may adversely affect Stella Fantasy or its future development. Further, stability and cohesion within the team is critical to the overall development of Stella Fantasy. There is the possibility that conflict within the team and/or departure of core personnel may occur, resulting in negative influence on the project in the future.

· Failure to develop: There is the risk that the development of Stella Fantasy will not be executed or implemented as planned, for a variety of reasons, including without limitation the event of a decline in the prices of any digital asset, virtual currency or SFTY, unforeseen technical difficulties, and shortage of development funds for activities.

· Security weaknesses: Hackers or other malicious groups or organisations may attempt to interfere with SFTY and/or Stella Fantasy in a variety of ways, including, but not limited to, malware attacks, denial of service attacks, consensus-based attacks, Sybil attacks, smurfing and spoofing. Furthermore, there is a risk that a third party or a member of the Company, the Distributor or their respective affiliates may intentionally or unintentionally introduce weaknesses into the core infrastructure of SFTY and/or Stella Fantasy, which could negatively affect SFTY and/or Stella Fantasy. Further, the future of cryptography and security innovations are highly unpredictable and advances in cryptography, or technical advances (including without limitation development of quantum computing), could present unknown risks to SFTY and/or Stella Fantasy by rendering ineffective the cryptographic consensus mechanism that underpins that blockchain protocol.

· Other risks: In addition, the potential risks briefly mentioned above are not exhaustive and there are other risks (as more particularly set out in the Terms and Conditions) associated with your participation in Stella Fantasy, as well as acquisition of, holding and use of SFTY, including those that the Company or the Distributor cannot anticipate. Such risks may further materialise as unanticipated variations or combinations of the aforementioned risks. You should conduct full due diligence on the Company, the Distributor, their respective affiliates, and the Stella Fantasy team, as well as understand the overall framework, mission and vision for Stella Fantasy prior to participating in the same and/or acquiring SFTY.