Part I: Information on risks

This whitepaper follows the draft technical standards specifying certain requirements of the Markets in Crypto Assets Regulation (MICA) as published in ESMA's Final Report from 3 July 2024

Offer-Related Risks	This MICA-compliant token offering aims to enable social and economic community use cases. As a pilot initiative within a non-profit framework, it seeks to establish a model for community engagement and token adoption, though there are inherent risks in early-stage offerings. Market Demand: As a new offering, demand for the tokens may be uncertain or initially limited, as community-driven token adoption can be gradual. Without broad adoption or active community engagement, token usage and trading activity may remain minimal, potentially affecting the token’s perceived utility and value within the community. Regulatory Evolution of MiCA: while MiCA is currently being rolled out, the regulatory landscape may evolve as the market matures. Future adjustments to MiCA could introduce additional compliance requirements or standards, impacting the project’s operations or necessitating further compliance measures.
Issuer-Related Risks	As a non-profit organization pioneering a MiCA-compliant token offering, the issuer faces unique risks related to financial sustainability and effective governance. Financial Sustainability: As an asbl, the organization relies on funds raised through the token to support both intial project development and ongoing community engagement intitatives. Thus, the organization’s ability to sustain ongoing operations and community initiatives may be affected by token demand. Governance and Internal Control: The asbl's governance structure and internal controls are critical to the project’s success. Given the focus on community building, any gaps in decision-making processes or resource management could hinder project implementation, reduce transparency, potentially affecting community trust and engagement.
Crypto-assets-Related Risks	Given the relatively new and evolving nature of crypto-assets, there are several risks associated with their adoption and use, particularly within a community framework. Community Knowledge and Education: many community members may have limited experience with digital assets, blockchain, or tokenomics. The varying levels of understanding among the community may lead to confusion, reluctance to participate, or loss of the tokens. Price Volatility: while the project is focused on community engagement and tokens are not intented for speculative purposes, the tokens may still experience price fluctuations due to external market forces. These fluctuations could cause concern or misunderstanding among community members, particularly if the tokens are perceived as having inconsistent or unreliable value. Legal Risks: Although the token offering is MiCA-compliant, the legal landscape around crypto-assets is still evolving. Future changes in regulations or new legal frameworks could introduce additional compliance requirements or restrictions that may impact the operation of the token or its intended use within the community.
Project Implementation-Related Risks	Implementing the token offering and its associated community-building project introduces several risks that could affect the overall success of the initiative. Project Delays: Unforeseen operational delays in launching the token offering or achieving key milestones could disrupt the project's timeline. Community Engagement: active participation from the community is essential for the success of the project. If the community is not adequately engaged or if there is insufficient buy-in, the token's utility and adoption may be limited, reducing its effectiveness in driving the intended social and economic impact. Resource Allocation: proper management of financial and human resources within the asbl is critical for project success. If the organization struggles to allocate resources efficiently, it could impact the execution of the project's community-building initiatives and its long-term sustainability. Partnerships and Ecosystem Integration: Building and maintaining relationships with other organizations, stakeholders, or platforms that align with the project's mission is essential for success. Without successful partnerships, the token’s social and economic impact may be limited, preventing the achievement of its intended goals.
Technology-Related Risks	OCLT will be initially launched in the Hive blockchain ecosystem comprised of the Hive blockchain at layer 1 and Hive-Engine blockchain at Layer 2. This blockchain ecosystem has been proven during more than 8 years (for Hive) and more than 4 years (Hive-Engine). These two blockchains can experience downtimes. During downtimes, the OCLT tokens would not be transferable. This blockchain ecosystem implements an advanced security system with a series of private keys of limited authority and a system for account recovery. As a consequence, there were no documented exploits during the whole period of operation. However, exploits cannot be authoritatively ruled out in the future. If an exploit happened, the affected users may lose part or all of their OCLT tokens.
Mitigation measures	OCL will dedicate a part of the funds to take measure to mitigate technology risk. In particular, the code of the blockchains is open source. It will be cloned and a copy maintained by OCL as an additional guarantee. In addition, OCL will run their own full API node of Hive and Hive-Engine, maintain a "seed" server and take regular snapshots of the state of the accounts holding OCLT, which it will conserve in a segregated data storage.