OTC Terms of Service Addendum

Last Updated: December 11, 2024

 

THIS TERMS OF SERVICE ADDENDUM ("OTC Addendum") is effective as of 21 November 2024, by and between Payward OTC Ltd. ("Payward OTC"), and you collectively referred to herein as the "Parties". Terms used but not defined herein shall have the respective meanings given to them in the Terms of Service.

 

PLEASE READ THE EXCHANGE TERMS OF SERVICE CAREFULLY BECAUSE THEY REQUIRE YOU TO ARBITRATE DISPUTES WITH US AND LIMIT THE MANNER IN WHICH YOU CAN SEEK RELIEF.  BY AGREEING TO THIS OTC ADDENDUM, YOU UNDERSTAND AND AGREE THAT YOU ARE ALSO AGREEING TO THE EXCHANGE TERMS. IF YOU DO NOT AGREE WITH ALL OF THE TERMS IN THE EXCHANGE TERMS AND THIS OTC ADDENDUM, YOU MUST CEASE ALL ACCESS AND USE OF THE OTC SERVICES DEFINED HEREIN. 

 

WHEREAS, you are availing the services provided by Payward OTC Ltd;

 

WHEREAS, the Payward group of companies (“Kraken”) maintain Terms of Service ("TOS") that govern the use of its platform and services;

 

WHEREAS, Payward OTC desires to append to the TOS to reflect the business of Payward OTC and legal requirements;

 

WHEREAS, you acknowledge the importance of such appends and agree to be bound by the terms and conditions as outlined in this OTC Addendum in addition to the TOS;

 

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

  1. General. Payward OTC may make the over-the-counter services (“OTC Services”), available to users that meet the eligibility criteria. Your use of the OTC Services confirms that you have read, understand, and accept all of the terms in this OTC Addendum. This OTC Addendum is subject to the full TOS, as they may be updated from time to time. Certain OTC Services may be governed by additional terms and conditions as mutually agreed to between the parties. 
  2. Services. Payward OTC provides OTC Services to eligible users for the trading of certain digital assets and derivatives, and the lending/borrowing of fiat and certain digital assets. For the avoidance of doubt: 
    1. the lending/borrowing of digital assets will be governed by a separate lending agreement entered into between you and Kraken (the “Lending Agreement”). If such Lending Agreement conflicts with this OTC Addendum, the Lending Agreement shall apply. 
    2. the trading of digital asset derivatives will be governed by a separate agreement entered into between you and Kraken (the “Derivatives Agreement”). If such Derivatives Agreement conflicts with this OTC Addendum, the Derivatives Agreement shall apply. 
  3. Recurring and Custom Trades. You may have the option to make Trades on a recurring or custom basis using the OTC Services. To the extent that you give Payward OTC instructions to make trades on a recurring or custom basis, you authorize Payward OTC to initiate recurring or custom electronic purchases or sales using Digital Assets and Fiat Balances in accordance with your initial instructions and based on your time period selection. Your authorization will remain effective until the expiration of your chosen time period or until you change your recurring or custom trade instructions, whichever occurs first. You acknowledge that the amount of any Digital Asset or Fiat Balances you purchase or sell in each recurring Trade will depend on the market price at the time of the Trade and will only be determined once the Trade is executed. Payward OTC may, at any time and without liability, reject, cancel, suspend or delay a recurring or custom Trade (in whole or in part) for any reason. Payward OTC is not liable for any recurring or custom Trade or any failure to make a recurring or custom Trade (including any rejection,  cancellation, suspension or delay of a recurring or custom Trade in whole or in part).
  4. The Quoting Services.  You may have the option to submit electronic messages to Payward OTC for the purpose of soliciting a quote for a Trade (a “Request for Quote” or “RFQ”) and to receive quotes for a Trade from Payward OTC (a “Quote”) via (i) its online RFQ Service or (ii) via direct communication with Payward OTC traders (together, the “Quoting Services”).  By accepting a Quote obtained via either of the Quoting Services, you place an order with Payward OTC to execute the Trade in accordance with your instructions.  Accepted Quotes are final, binding, and cannot be modified.  Proceeds from a successfully executed trade will be credited to you, less any applicable fees, and the Digital Assets or Fiat Balances you traded for such proceeds will be removed from your account.  
  5. Conflict of Interest Disclosure.  You understand that in all Trades, Payward OTC is your counterparty, not your agent or your broker.  Payward OTC’s interests and the interests of others trading with Payward OTC may diverge from yours.  By using the OTC Services, you agree and understand that Payward OTC is the exclusive counterparty for all Trades and that the affiliation between Payward OTC and any other Kraken affiliates may give rise to certain potential or actual conflicts of interest. If Payward OTC acts in circumstances where it – or any of its affiliates –  has a material interest or conflict of interests, Payward OTC will take reasonable steps to ensure that you are treated fairly. Payward OTC, in its discretion, may also decline to act in such circumstances. The following are examples (without limitation) of such potential conflicts of interest: (i) that certain Kraken affiliates have not established, and do not intend to establish, relationships with unaffiliated liquidity providers for purposes of the OTC Services, regardless of whether the terms and fees offered by such unaffiliated liquidity providers are more favorable than those offered by Payward OTC; (ii) that Payward OTC (or any of its affiliates) may make a profit in respect of a transaction on which you do not; and/or (iii) that Payward OTC may share various resources with other Kraken affiliates, including, but not limited to, office space, personnel, and systems.  For the avoidance of doubt, Payward OTC is not under an obligation to disclose that it, or any of its affiliates, has a material interest in a particular transaction with or for you or that in a particular circumstance a conflict of interest or duty may exist, where Payward OTC has, in its sole discretion, managed such conflicts to ensure, with reasonable confidence, that risks of damage to your interests will be prevented. Nor is Payward OTC under any obligation to account to you for any profit, commission or remuneration made or received from or by reason of transactions or circumstances in which it or one of its affiliates has a material interest or where in particular circumstances a conflict of interest may exist. 
  6. Termination. You may terminate your engagement with Payward OTC at any time by providing written notice (email sufficient) if there are no outstanding transactions. Should you give notice while a transaction is outstanding, your engagement will not be terminated until such transaction is complete. Payward OTC reserves the right, to temporarily or permanently, suspend the OTC Services, including terminating any outstanding or completed transactions, at its sole and absolute discretion at any time. 
    1. Errors.  In the event of an error, whether via the OTC Services or the Kraken platform, in a purchase order confirmation, in processing your purchase, in funding your account, in transferring Fiat Currency or Digital Assets to a Financial Account, or any other transaction, we reserve the right, and you authorize us, to correct such error, including by revising the transaction (including charging the correct price), canceling the transaction, or taking any other action to resolve the error (including exchange Fiat Currency or Digital Assets in your account for alternative types of Fiat Currency or Digital Assets and deducting any applicable Fees and taxes to correct the error).
  7. Ownership. You acknowledge and agree that, at the time you make use of any of the OTC Services with funds held on the Kraken platform or in a third-party wallet, you have the legal right to control and manage such funds, and such funds may not necessarily be owned by you but are free and clear of any liens and encumbrances.
  8. Fees and Spreads. You understand and agree that any fee or spread may be in addition to the quoted price and listed on the confirmation, or the quoted price may be inclusive of all fees and spreads. 
  9. Exit Fees. There are no exit fees associated with the OTC Services. 
  10. OTC Service Availability. While Payward OTC employs measures to ensure that the OTC Services are available 24 hours a day and 7 days a week, Payward OTC cannot guarantee uninterrupted or error-free operation of the OTC Services or that Payward OTC will correct all defects or prevent third-party disruptions or unauthorized third party access. 
  11. Dispute Resolution. You and Payward OTC agree to arbitrate any dispute arising from the OTC Addendum or your use of the OTC Services, except for disputes in which either party seeks equitable and other relief for the alleged unlawful use of copyrights, trademarks, trade names, logos, trade secrets or patents. ARBITRATION PREVENTS YOU FROM SUING IN COURT OR FROM HAVING A JURY TRIAL. You and Payward OTC agree to notify each other in writing of any dispute within thirty (30) days of when it arises. Notice to Payward OTC shall be sent to [email protected] with a copy to [email protected]. You and Payward OTC further agree: (a) to attempt informal resolution prior to any demand for arbitration; (b) that any arbitration will occur virtually; (c) that arbitration will be conducted confidentially by a single arbitrator in accordance with the rules of JAMS; and (d) that the courts in British Virgin Islands have exclusive jurisdiction over any appeals of an arbitration award and over any suit between the parties not subject to arbitration. The arbitrator has the authority to grant any remedy that would otherwise be available in court. Any dispute between the parties will be governed by the TOS, the OTC Addendum, any additional terms as agreed between the parties, and the laws of the State of California and applicable United States law, without giving effect to any conflict of laws principles that may provide for the application of the law of another jurisdiction. Whether the dispute is heard in arbitration or in court, you and Payward OTC will not commence against the other a class action, class arbitration or representative action or proceeding.
  12. Taxes.  You alone are responsible for determining what taxes apply to your use of the OTC Services and for reporting and remitting the correct taxes to the appropriate tax authorities. You agree that we have no responsibility or liability for determining what taxes apply or for collecting, reporting, withholding, or remitting any taxes arising from any trades or transactions, unless otherwise required by law.  

Notwithstanding anything herein to the contrary, we may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable to you such federal, national, provincial, local income non-income, or other taxes as may be required to be withheld pursuant to any applicable law or regulation of any jurisdiction or taxing authority.  You authorize us, in our sole discretion and in lieu of a separately stated tax amount, to increase any applicable Fees to account for taxes owed on a particular transaction undertaken using our services.  

We are subject to various obligations imposed by the tax (and other) laws and supervisory authorities of various jurisdictions. These obligations may require us to request additional information, documentation or certifications from you and process certain personal data for identity verification, payment processing, compliance with court orders, tax laws or other purposes not disclosed herein. Please refer to our Privacy Notice for Information we may collect about you. These obligations may arise at various times, including, but not limited to, client on-boarding, payment processing, and systemic checks for risk management, and may change without notice. We reserve the right to lock, disable and close accounts as deemed necessary by us in order to comply with any such legal and regulatory obligations now existing or hereinafter imposed.

For lending/borrowing of digital assets, it is intended that, absent a change in law or administrative practice to the contrary, the transfer and delivery of the digital assets shall be treated as a loan and, for US tax purposes, not be treated as an exchange of property for other property differing materially in kind or extent (within the meaning of Section 1001 of the Internal Revenue Code of 1986, as amended, as well as the corresponding Treasury Regulations). Refer to the Lending Agreement (if applicable) for additional terms regarding taxes.

 

By clicking "I agree" or by continuing to use Payward OTC Services after the effective date, you acknowledge that you have read and understood the contents of this addendum and agree to be bound by its terms and conditions. This addendum is incorporated into and forms an integral part of the Kraken TOS.