On-Chain Earn User Agreement: Terms & Conditions Explained

1. Overview

1.1 The On-chain Earn Service (the “On-chain Earn Service” or “Service”) is provided to you (“you” or “Customer”) by the Phemex entity applicable to you under the Phemex Term of Use (“Phemex”, “we”, “us”), the full content of which is incorporated by reference herein. The Service is offered as a value-added service to Phemex users so that they may earn Returns by depositing their Digital Assets on the Phemex Platform for a fixed or flexible term.

1.2 This On-chain Earn User Agreement (this "Agreement" or these “Terms”) governs your use of this Service and related services entered into by and between you (the “User” or “you”) and Phemex. In order to use the Service, you should carefully read and abide by this Agreement. By using the Service, you confirm that you have read and accepted all the terms of this Agreement. Your use of the Service represents that you have read, understood and agreed to this Agreement and that this Agreement is legally binding on you.

1.3 In the event of any conflict or inconsistency between any term or provision set forth in this Agreement and the Phemex Term of Use , such conflict or inconsistency shall be resolved by giving precedence to this Agreement. All provisions, including definitions, of the Phemex Term of Use not modified by this Agreement shall remain in full force and effect. Terms not defined here are defined in the Phemex Term of Use.

2. General

2.1 The Service allows Phemex users to deposit their Digital Assets on the Phemex Platform for a fixed or flexible term, so that they may earn Returns from the network. Subject to the terms and conditions of this Agreement, Subscription and Redemption are supported 24/7 on the Phemex Platform. For the avoidance of doubt, Subscriptions for a fixed term cannot be Redeemed earlier than maturity of the term. The On-chain Earn Service is not a principal-protected product and users risk principal loss (in whole or in part).

2.2 Definitions relating to the Service include:

Insurance Fund: The insurance fund at Phemex consists mainly of the funds provided by Phemex and the liquidation surplus from the liquidation orders, and is designed to protect user losses in case of huge, sudden market movements.
Insurance Fund Retention Fee: Phemex charges users of the Flexible Term version of the Service (described in Section 4.4 below) an Insurance Fund Retention Fee for use of the Service, as described in Section 4.7 below.
Network: The underlying blockchain infrastructure that supports the Proof-of-Stake (PoS) consensus mechanism, on which Phemex On-Chain Earn operates. This includes the decentralized system of nodes and validators responsible for processing transactions, maintaining security, and generating staking Rewards through newly minted tokens and transaction fees. The Network operates independently of Phemex and is subject to dynamic changes in Reward distribution, influenced by factors such as the total amount of assets staked, network inflation rate, and transaction volume.
Principal: Amount of Digital Assets in the User’s account which are deposited using the Service.
Redeem / Redemption: The closing of a position (in whole or in part) in the Service.
Return(s): The interest, yield and/or return that a User may receive by depositing its Digital Assets in the Network, provided such Digital Assets are successfully matched with borrowing demand.
Subscribe / Subscription: The opening of a position in the Service, which results in a deposit of Digital Assets in the Service. Such opening can be carried out either by the User manually opening a position on the On-chain Earn product page on the Phemex Platform.
T hour: The time when an order from a User is matched, used to calculated the hourly Return, in a normal trading day based on UTC+8 time zone.

3. Eligibility to Use the Service

3.1 You agree that Phemex may hold your Digital Assets for the duration of the Service in order to fulfill its obligations under the Service.

3.2 You also understand and confirm that:

You have agreed to abide by the Phemex Term of Use, and are eligible and permitted to use the Services specified therein;
If you use the Service, this Agreement is binding on you;
You have the experience and risk tolerance required to use the Service, and have the experience and knowledge necessary to invest in non-guaranteed digital asset products;
You have the ability to perform operations on the Internet;
This Agreement and your use of the Service does not conflict with the laws of your country or region, and you agree to comply with the laws of your country or region;
You are the legal and beneficial owner of all the Digital Assets in your Phemex account and that the sources of your Digital Assets and fiat currency are not from illegal activities.

3.3 You further agree that:

You will not use the Service in connection with any Prohibited Businesses (as defined in the Phemex Term of Use, including without limitation illegal purposes such as money laundering, terrorist financing, or fraud, or any other activities or any businesses prohibited by the law;
You will not use the Service in connection with any forms of price manipulation, insider dealing, market manipulation, market distortion or any other malicious wrongdoings to the market.

3.4 You understand and accept the risks that may arise to you and the related losses you may suffer from using the Service, as set out in the Phemex Term of Use and DISCLOSURE AND DISCLAIMER. Those risks and losses include but are not limited to:

Any loss you may suffer from the risks associated with the inability to sell or convert Digital Assets deposited into the Service into a preferred alternative asset immediately or where conversion is possible but at a loss. You are willing to bear the risks and potential financial losses caused by depositing Digital Assets into the Service;
Historical Returns are not indicative of future Returns. The expected Returns displayed on the Phemex Platform are theoretical estimates of Returns. They are not actual or guaranteed Returns promised by Phemex. Phemex does not guarantee or promise any Returns. Actual Returns may vary from the estimated or expected Returns. Returns shall be calculated and distributed by Phemex in its sole discretion. Phemex may deduct cost, fees, and expenses related to the operation of the Service from your actual Returns, to determine the final amount payable to you;
Price fluctuations of Digital Assets and their derivatives may cause significant or total loss in a short period of time;
The nature of Digital Assets means that technological difficulties experienced by Phemex may prevent a User's access to, or use of, its Digital Assets;
Market risks may occur, which may result in losses of your digital assets;
Phemex may have to add, remove, or change its terms or policies, including the terms of this Agreement, from time to time, while you are using the Service. Any such actions may benefit or harm users like you.

4. Use of the Services

4.1 Through the Phemex Platform, you can Subscribe to and Redeem positions in the Service.

4.2 When you Subscribe to the Service, your Digital Assets are deposited to the Service. When your Digital Assets are deposited to the Service, you cannot access, trade, sell, convert, or otherwise use them.

4.3 When Subscribing to the Service, you may choose “flexible” term or “fixed” term. For “flexible” term, you may Redeem your order, thereby withdrawing your Digital Assets from the Service, at any time, subject to the terms of this Agreement (in particular, see Section 4.6, below). For “fixed” term, you cannot Redeem your order for the full duration of the term once it is matched and drawn down as per the terms below; during this time, your Digital Assets cannot be withdrawn, accessed, traded, sold, converted, or otherwise used for the full duration of the term, which can be extended in cases of overdue loans. With respect to Redemption, see in particular Section 4.6, below.

4.4 On-chain Earn Flexible Term

At the time of Subscription by way of a manual order on the Phemex Platform, you are required to select: (i) a Digital Asset type; (ii) a Digital Asset quantity; and (iii) a minimum expected rate of Return provided by the Network (in the form of an annualized percentage rate, or “APR”) that you wish to yield from the Digital Assets deposited into the Service.
Once your Subscription is successful, Phemex will attempt to match your order (and the Digital Assets referred to in such order) with borrowing demand. Borrowing demand comes from the Network.
If your order is successfully matched (in whole or in part) with borrowing demand, you will start to accrue Returns from the Digital Assets that are matched. Not all Digital Assets within an order may be matched. Any Digital Assets that are not matched will not earn Returns;
Any Digital Assets that are matched will earn Returns at the rate specified in your order or at a market rate, if it is higher. If the market rate is lower than the rate specified in your order, your order will not be matched.

When the lending pool is almost fully utilized or if market circumstances require, Phemex may, at its discretion, adjust the market APR to a higher level ("Adjusted Market APR") according to the Network APR. During this period:

If your Digital Assets were unmatched prior to adjustment, your Digital Assets may remain unmatched. Your Digital Assets may only be matched if your specified minimum lending APR is lower than market APR prior to adjustment. Accordingly, even if your specified minimum APR is lower than the market APR shown on the Phemex Platform, your Digital Assets may not be matched because an Adjusted Market APR is in effect.
If your specified minimum lending APR is higher than the Adjusted Market APR, your Digital Assets may not be matched.

Any unmatched Digital Assets will not generate any Returns.

e. Returns accrue and are distributed to your account daily. No Returns are generated for parts of an hour. If your order is matched on the T hour, the hourly Return for the T hour shall accrue from T hour to T+1 hour and will be distributed after the T+1 hour;

f. Flexible Term Subscriptions can be Redeemed at any time. Any orders Redeemed will not earn Returns for the hour in which they are Redeemed;

4.5 On-chain Earn Fixed Term

At the time of Subscription, you are required to select: (i) a Digital Asset type; (ii) a Digital Asset quantity; and (iii) a period of time during which the Subscription will remain active (i.e., the fixed term). The APR upon which your Subscription is placed is shown to you on the Platform. The prevailing market APR is determined by Phemex from time-to-time, taking into account various market factors. The APR remains fixed for the duration of the term;
Once your Subscription is successful, Phemex will attempt to match your order (and the Digital Assets referred to in such order) with borrowing demand. Borrowing demand comes from other services provided by Phemex to its users;
Borrowing demand on the Phemex platform is split into borrowing orders. When attempting to match your order with borrowing demand, Phemex will attempt to match it to specific borrowing orders. Your lending order will start to earn interest and its term will begin when (i) it matches (in whole or in part) with a borrowing order; and (ii) either (x) that borrowing order has been filled to the full amount of that borrowing order and is thus automatically drawn down upon; or (y) the borrower attributable to that borrowing order with which your lending order has matched seeks for the borrowing order to be drawn down upon while it is partially filled; or (z) the prevailing market APR changes in which case the borrowing order will be partially drawn down upon in the amount at which it has been filled at the time of the APR change. Not all Digital Assets within a lending order may be matched and drawn down upon. It may be the case that no or only a part of the Digital Assets referred to in an order are matched and drawn down upon. Any Digital Assets that are not matched and drawn down upon will not earn Returns. Your Digital Assets may all be matched and drawn down by borrowing demand from the same or multiple borrowing orders, or not matched or not drawn down upon at all. If your lending order is matched to multiple borrowing orders, the term for different parts of your lending order may vary depending on the time at which each borrowing order was drawn down upon;
Any Digital Assets that are matched and drawn down upon will earn Returns at the APR shown at the time of placing your order;
Returns accrue daily and are distributed to your account at the end of the term. No Returns are generated for parts of a day. If your order is matched on the T day, the daily Return for the T day shall accrue from T day to T+1 day. In the event that there is an early termination of the borrowing order under which your lending order has been drawn down upon (in whole or in part) within 12 hours before the end of the original term, your Returns will be limited to those earned until the end of the full hour in which the early termination was carried out and you will not earn any Returns for the number of full hours left until the end of the original term;
“Fixed” term Subscriptions cannot be Redeemed for the full duration of the term,to the extent that your order has been matched and drawn down upon;

4.6 Upon a Redemption command being input into the Phemex Platform, the redeemed Digital Asset may arrive in your Account simultaneously or after a period of time, depending on a number of factors, including token type and market activity. You understand and acknowledge that between the time that the Redemption command is given and the time of actual release of Digital Assets in your Account, you will not earn any Returns on and you will not have any ability to access the Digital Assets being redeemed. You understand and accept that the time taken for the Digital Assets to be released may vary, and that during this time, the price of your Digital Assets may fall. Phemex is not responsible for any such loss. The arrival time shown on the Phemex Platform is final. If market circumstances require, your Redemption will be delayed, at Phemex’s sole and unfettered discretion. This includes situations where there is insufficient liquidity on the Phemex Platform or in the On-chain Earn Service, or there has been an unexpected reduction in such liquidity. In the event that Redemptions are delayed, they will be dealt with on a first-in first-out basis, such that earlier Redemptions will be satisfied in preference to later Redemptions, subject to Phemex’s discretion to re-order Redemptions based on size or other market circumstances. You acknowledge and undertake the risk that any such delays in Redemption may result in a partial or total loss in the value of your Digital Assets.Partial Redemption of any orders that have not yet been drawn down upon in the Fixed Term version of the Service is not permitted.

4.7 Phemex charges users of the Flexible Term version of the Service (described in Section 4.4, above) an Insurance Fund Retention Fee for use of the Service. The amount of such Insurance Fund Retention Fee shall be published on the Phemex Platform, and may be modified by Phemex, from time to time. As at the time of these terms, the Insurance Fund Retention Fee is equivalent to 15% of the Returns generated for you by your use of the Service. Such Insurance Fund Retention Fee is retained by Phemex prior to delivery of Returns to you.For the avoidance of doubt, no Insurance Fund Retention Fee is charged to users of the Fixed Term version of the Service (described in Section 4.5, above).

4.8 Phemex reserves the right to introduce, impose, adjust or remove any Subscription and Redemption limits in its sole discretion, while you are using the Service. Master accounts and sub-accounts may share any limits.

5. Suspension / Cancellation / Termination

5.1 Phemex may suspend, cancel or terminate the Service, or your use of the Service at any time at its sole discretion. The Phemex Term of Use set out the circumstances in which Phemex may suspend, cancel or terminate the Service. Without prejudice to the generality of the foregoing, those circumstances may include situations where:

you do not provide additional information to verify your identity or source of funds as requested by Phemex;
Phemex is required to do so by court order, to comply with any Applicable Laws and Regulations;
Phemex is required to do so to comply with any direction or instruction from a government body or agency;
Phemex reasonably determines that any information you have provided to Phemex is wrong, untruthful, outdated or incomplete; or
you do not provide additional information that we request to our reasonable satisfaction or in a timely manner.

6. Liabilities

6.1 The Phemex Term of Use set out situations in which you may incur losses or liabilities and Phemex assumes no liability. Without prejudice to those terms, those situations include:

Inability to use the Service or make commands or perform trading operations due to failure, delay, interruption, lack of system response, delayed system response, lack or reduction of liquidity in the Service, or other abnormal circumstances;
Service suspension for maintenance;
Failure to transmit data;
Force majeure events or accidents, such as typhoon, earthquake, tsunami, flooding, plague, power outage, war, turmoil, government actions, terrorist attacks, pandemic, epidemic, or other such acts;
Service interruption or delay due to hacking, computer virus, technical adjustment or failure, website upgrade, banking issues, temporary closure due to government regulations or other such matters;
Losses due to technical problems that cannot be predicted or solved by existing technical forces;
Losses due to third parties;
Losses due to changes in any Applicable Laws and Regulations, or government, regulatory or law enforcement orders.

You agree and accept that the above or any other reasons may lead to abnormal transactions, abnormal market and price fluctuations, market interruptions and other possible abnormal circumstances.

6.2 Phemex reserves the right and sole discretion to refuse to execute or cancel your commands.

6.3 You agree and accept that Phemex shall not be liable for any losses caused by the risks described in this Agreement or the Phemex Term of Use (including but not limited to any direct or indirect losses, actual losses or possible loss of profits).

7. Technology disclaimers

7.1 Phemex may, from time to time, suspend access to your Phemex accounts, the Phemex Platform, the Service and/or any other Phemex services, for both scheduled and emergency maintenance. Phemex will make reasonable efforts to ensure that transactions on the Phemex Platform are processed in a timely manner, but Phemex makes no representations or warranties regarding the amount of time needed to complete any such maintenance.

7.2 Although Phemex makes reasonable efforts to update the information on the Phemex Platform, Phemex makes no representations, warranties, or guarantees, whether express or implied, that the content on the Phemex Platform, including information in relation to the Services and any other Phemex Services, is accurate, complete, or up to date.

7.3 You are responsible for obtaining the data network access necessary to use the Services or any other Phemex Services. You are responsible for acquiring and updating compatible hardware or devices necessary to use the Service, any Phemex Services, the Phemex Platform, and any updates thereto. Phemex does not guarantee that any of the Phemex Services, or any portion thereof, will function on any particular hardware or devices. Phemex Services may be subject to malfunctions and delays inherent in the use of the internet and electronic communications.

7.4 Despite our efforts to ensure the security of your data and transactions, the risk of unauthorized access, hacking, data loss, or other breaches cannot be completely eliminated. You acknowledge that you bear the risk of any unauthorized access to your account information and any loss of Digital Assets resulting from such security breaches.

7.5 The field of digital assets is rapidly evolving, and changes in technology may require adjustments to the Services or how you interact with the Phemex Platform. Phemex reserves the right to modify the technology used, the features provided, or the Service requirements based on technological advancements or regulatory changes without prior notice.

8. Mandatory Measures

You agree and accept that Phemex strictly prohibits unfair trading practices. Phemex reserves the right to exercise control over your account, restrict, suspend or shut down your account in its sole discretion if you engage in any of the following conduct:

Market manipulation, price manipulation, insider dealing, market distortion, or any other malicious wrongdoing or behaviour;
Participation in any activities that Phemex regards as harmful to the market;
Violation of any Applicable Laws and Regulation.

In order to eliminate any adverse effects on the overall market, Phemex reserves the right and sole discretion to suspend or terminate your account, use of the Service, or refuse to execute or cancel your commands. Phemex shall not be liable for any losses (including but not limited to any direct or indirect losses, actual losses or losses of possible profits) incurred in connection with the above measures.

9. Indemnification

9.1 You shall take every possible measure to protect Phemex from any damages arising out of your use of the Service or other actions related to your Phemex account.

9.2 You agree to indemnify, hold harmless and promptly defend Phemex and Phemex’s affiliates and associates (including our and their respective agents (if any) and the shareholders, directors, officers and employees of Phemex and Phemex’s affiliates and associates) (each an “Indemnified Party”) from and against any and all losses arising from or in connection with any claims, losses, liabilities, damages, judgments, penalties, fines, costs and expenses of whatever kind (including professional fees and reasonable attorney’s fees) which may be suffered or incurred by any of the Indemnified Party arising out of or related to your use of the Service or other circumstances set out in the Phemex Term of Use.

10. Miscellaneous

10.1 The contents of this Agreement also include Phemex's various system specifications, guidance notes, product documents, or other relevant documents that Phemex may issue from time to time. Upon release, such content becomes an integral part of this Agreement, and you should also abide by it. In the event of any conflict between the above content and this Agreement, this Agreement shall prevail.

10.2 Phemex reserves the right to unilaterally modify this Agreement or any terms applicable to the use of the Service in its sole discretion. Such modification could happen at any time without prior notice, including while you are using the Service. If any changes are made, the revised contents shall be posted on Phemex's website promptly. Please check the latest information posted therein to inform yourself of any changes. Your continued use of or access to the Service following the posting of any changes constitutes acceptance of those changes. If you do not accept the revised content, you should stop using the Services.

10.3 You should carefully read this Agreement, and any document referred to in Sections 10.1 and 10.2 of this Agreement that constitute the contents of this Agreement, in conjunction with the Phemex Term of Use. In the event of any discrepancy between the English version of this Agreement and any translated version, the English version of this Agreement shall prevail.

10.4 If any provisions of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired in any way. However, if any provision of this Agreement shall be invalid, illegal or unenforceable under any such applicable law in any jurisdiction, it shall, as to such jurisdiction, be deemed modified to conform to the minimum requirements of such law, or if for any reason it is not deemed so modified, it shall be invalid, illegal or unenforceable only to the extent of such invalidity, illegality or limitation on enforceability without affecting the remaining provisions of this Agreement, or the validity, legality or enforceability of such provision in any other jurisdiction.

10.5 The failure or delay of Phemex’s enforcement of any right or provision of this Agreement will not be deemed a waiver of such right or provision.

10.6 This Agreement, your use of the Services, any claim, counterclaim or dispute of any kind or nature whatsoever arising out of this Agreement, directly or indirectly, shall be governed by, and construed in accordance with the laws of England and Wales without regard to the principles of conflicts of laws thereof.

10.7 You shall not transfer, novate or assign this Agreement, and the rights and obligations hereunder, in whole or in part, without the prior written consent of Phemex. Phemex has the right to transfer, novate or assign any rights or obligations under this Agreement by serving written notice on you, which takes effect upon the delivery of such notice.

10.8 The headings of all the terms of this Agreement are for convenience only and have no actual meaning and cannot be used as a basis for interpretation of the meaning of this Agreement.

10.9 Phemex shall have the sole and final discretion to interpret this Agreement.

The Phemex Team

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On-Chain Earn User Agreement