b. 📚 Compliance with Relevant Regulations and Laws

Issuance of securities and regulatory framework

1.General Criteria

There is currently no European or national regulatory framework as such that specifically defines the obligations and requirements to be met for the issuance of securities based on blockchain technology. However, taking into account the financing method used by Ibiza Token, there are already regulated processes that may be similar to the present case. Thus, the main regulatory reference standard, in this case, is the Securities Market Law (LMV).

The LMV establishes that the issue of negotiable securities falls within the scope of the law, understanding as such any right of patrimonial content, regardless of its denomination, which, due to its configuration and transmission regime, is susceptible to generalized traffic in a specific financial market. In this regard, the CNMV in its document “CNMV. (2018). Criteria in relation to ICOs.” understands that two main factors must be assessed when determining whether or not a token is tradable security:

a. The token grants rights or expectations of participation in the potential revaluation or profitability of the business or project in which it is framed or, in general, that it presents or grants rights equivalent or similar to those of the shares or debentures.

b. The token grants the right to access services or to receive specific goods or products, and the token, in turn, is offered with explicit or implicit reference to any of the following issues:

i) The expectation that the purchaser or investor will obtain a benefit as a result of the revaluation of the token; or

ii) The expectation of obtaining by the buyer or investor of a remuneration associated with the token; or

iii) The liquidity that the token would benefit from; or

iv) The possibility of trading of the token in markets equivalent or purportedly similar to the securities markets subject to regulation.

The issuance of this type of securities requires the preparation of a specific legal document called “prospectus”; this document must comply with a series of specific requirements and must be approved and supervised by the CNMV.

Consideration of Ibiza token as a negotiable security

In this sense, in order to carry out the issuance of Ibiza Token under an optimal legal framework, we consulted the CNMV in order to determine whether the token issued is negotiable security or not and if, therefore, we had to comply with a series of specific legal requirements, such as the preparation of the aforementioned “informative prospectus”.

Although the consultation carried out is not official or binding, the CNMV has been able to determine that, based on the information previously provided on Ibiza Token, it is understood that an ERC-20 type token will be issued which, regardless of how it is acquired, entitles, solely and exclusively, to discounts and services in the participating establishments, to acquire digital content provided through the platform and to participate in the platform’s decision making as a governance token of the same, not holding, in any case, a remuneration, economic rights or its revaluation linked to the development of the underlying business.

Therefore, the CNMV determines that Ibiza Token can be considered as a utility token, which is non-tradable security whose purpose is to give its holders access to certain benefits, without the expectation of revaluation of the token being its main purpose. This type of token has the following main characteristics:

A. It does not grant rights or expectations of profitability and participation in the profitability of Defi Proxima’s underlying business.

B. It does not offer access to services, goods or products with the expectation of a possible obtaining by the buyer or investor of a profit as a result of the revaluation of the token.

This definition is consistent with that made by the CNMV together with the Bank of Spain, in its Report of February 8, 2018, which established that utility tokens are those that give the right to access a service or receive a product, without prejudice to which, on the occasion of the offer, mention is usually made of expectations of revaluation and liquidity or the possibility of trading them on specific markets.

KYC and Prevention of Money Laundering or Terrorist Financing

We inform you that Defi Proxima has adopted KYC (“Know your customer”) procedures to verify the identity of each investor or user of the platform who has expressed or will express interest in acquiring Ibiza Token or using the platform, and only those who have successfully identified themselves, under Defi Proxima’s criteria, will have the opportunity to participate in the sale of Ibiza Token or use the platform.

These KYC procedures are based on current market practices, in accordance with applicable Spanish and European Union legislation, and specifically with the provisions of the Law on the Prevention of Money Laundering and Terrorist Financing.

In any case, the information required by the issuer to know the identity of each investor or user will be the information shown during the token acquisition process or registration in the platform.

Protection of Personal Data

The data provided will be processed in order to manage the acquisition of cryptocurrencies requested by the investor as well as the use of the platform by its users.

You may exercise your rights of access, rectification, deletion, limitation of processing, opposition and portability by writing to [email protected].

At any time, you can assert your rights before the Spanish Data Protection Agency. You can find more information about the data processing carried out by Defi Proxima in the Privacy Policy.

Exclusion of liability

Please note that this document is intended to inform and provide a description of Defi Proxima’s project, its platform, and the intended future use of the Ibiza Token, and therefore it does not create any binding legal obligation. Furthermore, it is an initial summary of the business objectives that Defi Proxima has determined based on the characteristics of its project. In any case, before acquiring the Ibiza Token, you should especially consider the following:

a. Neither the Ibiza Token platform nor its tokens will be available to minors or any natural or legal person who is in a country or jurisdiction where the holding of cryptocurrencies is prohibited by law or specific policies, as well as to those natural persons who are citizens, nationals, residents or have a similar connecting factor to that territory, including legal persons incorporated, registered or effectively managed or controlled in such territories.

b. Ibiza Token is configured as a utility token and not as a security token, not representing or conferring, in any case, any ownership, participation, share, or equivalent rights over Defi Proxima.

c. This document does not constitute an informative prospectus, prospectus, or offering document validated by the CNMV or any other competent administration. Nor does it constitute a solicitation of investment or offer of financial instruments and securities.

d. Any decision to purchase Ibiza Token should be based on a consideration of this Whitepaper as a whole.

It is the sole responsibility of the investor to ensure that, for the purpose of acquiring Ibiza Token, it does not require any prior or subsequent authorization, notification, registration, or license based on the country of which it is a citizen or resident in the case of an individual, or incorporated in the case of a legal entity. Defi Proxima shall in no event be liable for any failure of the investor to comply with the foregoing.