Conflict of Interest Statement

Ndax Canada Inc. (Ndax, we, us or our) is currently operating under a pre-registration undertaking (PRU) dated March 24, 2023 (found here) that it signed in favor of the Alberta Securities Commission and the other members of the Canadian Securities Administrators. Under the terms of the PRU, Ndax and our representatives are required to take reasonable steps to identify and address existing and reasonably foreseeable material conflicts of interest in a user’s best interest and tell users about them, including the nature and extent that the conflicts might impact users and how Ndax addresses them in a user’s best interest.  

A conflict of interest may arise where (a) the interests of Ndax or those of our representatives and those of a user may be inconsistent or different, (b) Ndax or our representatives may be influenced to put Ndax or the representative’s interests ahead of those of a user, or (c) monetary or non-monetary benefits available to Ndax, or potential negative consequences for Ndax, may affect the trust a user has in Ndax.

Ndax and our representatives always seek to resolve all material conflicts of interest in our users’ best interest. Where it is determined that Ndax cannot address a material conflict of interest in our users’ best interest, Ndax and our representatives will avoid that conflict.  

Ndax has adopted policies and procedures to assist it in identifying and addressing any material conflicts of interest in the best interest of our users.

Material Conflicts of Interest

A description of the material conflicts of interest that Ndax has identified in relation to our role as the operator of a crypto trading platform under the terms of the PRU, the potential impact and risk that each conflict of interest could pose, and how each conflict of interest has been or will be addressed, is set out below.

Confidential information  

Ndax and our employees are prohibited from using confidential information acquired in the course of or in connection with one’s duties or exploiting a situation for the purpose of obtaining an advantage of any kind.  

Ndax has established strict policies and procedures and has put in place a number of safeguards to ensure the appropriate handling of confidential information. Ndax uses encryption and other security measures to protect that information from unauthorized access or disclosure, and access to sensitive information is restricted to only those employees who have a legitimate business need to know.

Trading and financial or professional relationships with users

Ndax employees may not have activities of a financial or professional nature with a user without Ndax’s prior authorization. The authorization process includes the assessment and supervision of any material conflicts of interest and is intended to ensure the user’s interests are completely protected.

Ndax's internal Policies and Procedures restrict employees from any financial dealings with the users, such as lending or borrowing fiat, virtual currencies, securities, or any other asset; accepting any considerations, except those of nominal value, which will not cause a reasonable person to question whether it created a conflict of interest; acquire a power of attorney or act as a trustee or executor on behalf of a User, or otherwise have full or partial control or authority over the financial affairs.

User priority rule

The interests of our users must always be given priority over those of Ndax and our employees. We will give the execution of your orders priority over any orders placed for our proprietary accounts and we will not trade in reliance upon orders or knowledge of orders to be placed for your account.

Gifts, entertainment, and payments

Ndax and our employees are prohibited from accepting gifts, entertainment, or payments that could influence decisions to be taken in the course of performing one’s duties. In carrying out their duties, and to avoid any real or perceived conflict-of-interest situations, Ndax employees may not receive any other form of compensation than that paid by Ndax without the prior written approval of Ndax. In addition, Ndax ensures that our practices for compensating our representatives are not inconsistent with their obligations to our users.  

Outside activities

At times, our representatives may participate in activities outside of their employment with Ndax, such as serving on a board of directors, participating in community events, or pursuing personal outside business interests, whether paid or unpaid. A potential conflict can arise from a representative of Ndax engaging in such activities as a result of compensation received, the time commitment required, or the position held by the representative in respect of these outside activities. The potential impact and risk to you are that these outside activities may call into question the representative’s ability to carry out their responsibilities to you or properly service you, and there may be confusion about which entity(ies) the representative is acting for when providing you with services and/or if the outside activity places the representative in a position of power or influence over you.  

We address this conflict by requiring all representatives to disclose any proposed outside activities to us prior to engaging in such activities. The Chief Compliance Officer of Ndax must approve the outside activity before a representative can engage in such activity. We will not allow the representative to proceed with the outside activity if we determine that the outside activity will give rise to material conflicts of interest that cannot be addressed in our users’ best interest.

Referral Arrangements

Ndax may enter into referral arrangements from time to time whereby it pays or provides a fee or other benefit for the referral of a user to Ndax, or whereby it receives a fee or other benefit for the referral of a user to another entity. Referral arrangements may be entered into both with other registrants and with non-registrants.

In all cases, the referral arrangement will be set out in a written agreement which will be entered into in advance of any referrals being made. Details of how the referral fee is calculated and paid and to whom it is paid and other required information regarding each referral arrangement will be provided to affected users as required.

Ndax also has policies and procedures that are designed to ensure that fees and other benefits received or paid or provided, as applicable, in connection with referral arrangements are appropriate and do not provide inappropriate incentives, and that any referral by Ndax is in the user’s best interest. Ndax undertakes periodic reviews of referral arrangements. Users do not pay any additional charges and fees in connection with referrals and are not obligated to purchase any product or service in connection with a referral.

Complaint handling

Addressing a complaint by a user can create a potential conflict if we have a choice between addressing the complaint in a manner that is beneficial to us or addressing the complaint in the best interests of the user. The potential risk to you is that we act in our own business interests. To control this potential conflict, we have adopted internal policies and procedures for the handling of user complaints.  

Changes

This conflict of interest statement may change from time to time, for example, if we later consider we have another material conflict that we have not previously disclosed to you or we change how we address a conflict in your best interest. Any changes to this document will be communicated to you from time to time. 

Last Updated on June 14, 2023