Risk Disclosure

1. Who This Disclosure Is For

This Risk Disclosure is for anyone who is considering, or has begun, using ORACLX ("the Service"). It is required reading and is incorporated by reference into our Terms of Service and Privacy Policy. It does not enumerate every possible risk; you must apply your own judgment and seek your own advice.

Where this Disclosure conflicts with marketing copy, screenshots, social media posts, support replies, or other communications about ORACLX, this Disclosure controls.

2. Not Investment, Legal, or Tax Advice

Nothing in the Service or in any communication from us is investment advice, financial advice, legal advice, accounting advice, or tax advice, and nothing should be construed as a solicitation or recommendation to enter into any transaction. ORACLX is not your broker, dealer, custodian, adviser, fiduciary, or counterparty in any regulated capacity.

Battle outcomes, ELO standings, win streaks, and historical statistics are backwards-looking and have no predictive value for future Battles you may enter. Past performance of any Player, including yourself, is not indicative of future performance.

3. Risk of Total Loss

Each Battle is a winner-takes-most contest. If you lose, your entire Stake for that Battle is forfeit and is paid (95%) to your opponent and (5%) to ORACLX as a service fee. There is no partial refund based on how close the Battle was, how many candles you correctly predicted, or how recently you opened your account. Spectator side bets follow the same all-or-nothing logic, with the additional risk that your payout depends on how many other Spectators bet on the same side as you.

Total loss is not a remote tail risk. It is the expected outcome for the losing side of every Battle. The Service is designed around this premise.

4. Probability and Skill

Predicting whether a 1-minute Bitcoin candle will close higher or lower than its open is, in the short run, close to a coin flip. There is some skill component (reading order book signals, recent momentum, anticipating common timeframes traders react to), but the inherent randomness of price action over a 60-second window is large. A skilled Player will not win every Battle, and an unskilled Player can win streaks of Battles purely by chance.

Negative variance (a "losing streak") is a normal feature of the system, not evidence of cheating, manipulation, or platform malfunction. Statistical fluctuations of dozens of Battles in either direction will occur and do not themselves justify a refund or chargeback claim.

5. Underlying Price Feed Risks

Battle outcomes are settled against the publicly available 1-minute candle close prices on a designated reference exchange (currently Binance for the BTC/USDT pair). This introduces multiple sources of risk you must accept:

• Exchange outage or halt — the reference exchange may stop publishing prices, halt trading, or return malformed data. ORACLX may, in such cases, void the affected candles or the entire Battle, but disputes about fairness during such events are inherent.
• Reference manipulation — the reference price feed can in theory be manipulated by parties with sufficient capital. ORACLX has no control over the underlying market.
• Latency and timestamp ambiguity — slight differences between the time you committed your prediction and the time the candle closed may produce results that feel arbitrary.
• Reference change — ORACLX may change the reference exchange or methodology in the future.
• Stablecoin de-pegging — the BTC/USDT pair denominates BTC against the USDT stablecoin, which may itself trade away from $1 USD. A USDT de-peg event can affect the price you see on the reference without any change in BTC's "true" USD price.

6. Cryptocurrency Volatility

The digital currency that you Stake (currently USDC, with possible additions in the future) and the underlying instrument that Battles reference (BTC) are highly volatile. Their fiat-equivalent value can move materially over the course of a single Battle, intraday, or longer-period. A win in nominal token terms may still represent a fiat loss; a loss is, almost by construction, a fiat loss.

Stablecoins, including USDC, carry their own risk: failure of reserve custody, regulatory action against the issuer, or de-pegging events can rapidly impair value. ORACLX cannot indemnify you against stablecoin issuer failure.

7. Smart Contract Risk

The core economic logic of the Service runs on Smart Contracts deployed to a public blockchain. Smart contracts are immutable-by-design software running in an adversarial environment. Specific risks include:

• Code defects — the contracts have been tested and (where applicable) third-party audited, but no audit guarantees the absence of vulnerabilities. A defect that drains escrow funds, mis- allocates payouts, or freezes Stakes could result in total loss.
• Compiler and tooling risk — undiscovered compiler bugs or tooling defects could cause the deployed bytecode to behave differently than the source code suggests.
• Upgrade risk — where contracts are upgradeable, an upgrade introduces new code with its own bugs; where contracts are non-upgradeable, a bug cannot be patched and may force a migration to a new contract that abandons funds in the old one.
• Operator key compromise — a settler hot wallet or multi-sig owner key, if compromised, could be used to call admin functions exposed by the contracts, with consequences that vary by contract design.
• External call risk — interactions with USDC, paymasters, or other dependencies introduce risks specific to those dependencies.

Once a transaction is confirmed on-chain, ORACLX cannot reverse it. Recovery from a contract bug, where possible at all, generally requires a coordinated migration over weeks and may not return all funds.

8. Wallet, Key, and Account Risk

Your funds are held in a Wallet that you control through your wallet provider (currently Magic Labs). Risks specific to this model include:

• Email compromise — anyone who gains access to your email account can authenticate to the wallet provider as you and may be able to drain your Wallet. Use strong, unique credentials and enable two-factor authentication on your email account.
• Wallet provider failure — if the wallet provider experiences an outage, security incident, or business failure, you may temporarily or permanently lose access to your Wallet. Wallet providers are not banks; they are not subject to deposit insurance schemes.
• Recovery factor loss — losing your recovery method (where one exists) may permanently lock you out of your Wallet, with funds becoming unrecoverable.
• Phishing — attackers may impersonate ORACLX or your wallet provider to trick you into authorizing a malicious transaction. Always verify URLs and signed transaction contents.
• Approval exploits — once you grant a contract approve() permission for an unlimited amount of USDC, a malicious or compromised contract could in principle move all approved USDC out of your Wallet. Only approve contracts you have independently verified, and revoke approvals you no longer need.
• Malicious browser extensions — extensions with the right permissions can read or modify the contents of pages you visit, including signing prompts. Audit your extensions and prefer a clean browser profile for finance-adjacent activity.

9. Blockchain Network Risk

Public blockchains are themselves subject to risks beyond ORACLX's control, including:

• Network congestion that delays or fails to confirm a transaction;
• Spikes in gas fees that materially increase the cost of using the Service;
• Chain reorganizations that reverse short-confirmed transactions;
• Validator or sequencer outages on layer-2 networks;
• Forks (intentional or contentious) that bifurcate balances and contracts;
• 51% attacks or other consensus failures, however unlikely;
• Censorship at the validator, sequencer, or RPC level.

10. Account Abstraction & Paymaster Risk

The Service relies on ERC-4337 account-abstraction infrastructure to enable users to pay gas in stablecoin (USDC) rather than the network's native token (ETH). Specific risks include:

• Paymaster operator failure — if the paymaster's operator goes offline, runs out of native-token inventory, or changes their policy, your transactions may fail or become unsponsorable.
• Paymaster pricing — the conversion rate from USDC to ETH-equivalent gas is set by the paymaster and includes a markup. The exact effective gas price is opaque to you at the time of signing.
• Bundler censorship — bundlers (the entities that submit your UserOperations on-chain) may decline to include your transaction.
• EntryPoint contract risk — the EntryPoint contract itself is a Smart Contract subject to the risks described in Section 7.

11. Counterparty Risk

Each Battle has another Player as your counterparty. While the Smart Contract enforces the economic terms of the Battle, your counterparty may:

• Fail to commit their Stake within the funding window (in which case the Battle is cancelled and your Stake is refunded, less unrecoverable network fees);
• Disconnect from the Service mid-Battle (the Battle is settled by the candle outcomes regardless; you do not receive a "default" win for an opponent's disconnect);
• Engage in manipulation or collusion (see Section 14);
• Win a streak of Battles against you, by skill or by chance.

12. Platform & Operational Risk

ORACLX operates infrastructure that is necessary to access the Service even though the Smart Contract is the source of truth for funds. Specific operational risks include:

• Service outages — the website, API, real-time media, or matchmaking infrastructure may go offline. While off-chain, this prevents new Battles from starting and may delay settlement of existing Battles.
• Settlement-key failure — settlement is initiated by an operator hot wallet that signs the on-chain settle transaction. If this key fails, settlement may be delayed; if it is compromised, an attacker could in principle settle Battles to incorrect winners, though contract design constrains how much damage this can cause.
• Matchmaking imperfection — the matchmaking system may pair you against a stronger opponent than your ELO suggests, against a Player using strategies you have not encountered, or in timing windows unfavorable to you.
• Real-time media outage — the LiveKit-based audio/ video infrastructure may fail mid-Battle. The Battle continues to settle on candle outcomes regardless.
• Front-end risk — bugs in the web app, browser incompatibilities, or local network issues may cause your prediction to be missed or recorded incorrectly. ORACLX does not guarantee that your local UI will always reflect the canonical state of a Battle.
• Data loss — off-chain data (chat, presence, leaderboard history) may be lost or corrupted. Off-chain data is not the source of truth for funds.

13. Spectator Betting Risk

Spectator side bets carry every risk of regular Battles plus additional risks specific to side-betting structure:

• Your payout, if you bet on the winning Player, depends on the size of the winning-side spectator pool relative to the losing-side pool. A heavy crowd-favorite line can result in a winning bet returning less than your principal in fiat terms after fees.
• If no Spectator bet on the winning side, all side bets are refunded (less unrecoverable network fees) and ORACLX retains no fee — but you also miss the opportunity for a payout.
• You cannot "hedge" a side bet by betting on both Players in the same Battle from the same Account; doing so would simply trigger the Spectator Fee on whichever side wins, costing you 3% net.
• The Spectator betting window is short. Late attempts to place a bet may fail and may not be retryable.

14. Manipulation, Collusion, & Multi-Account Risk

Although ORACLX takes anti-manipulation measures, you should assume that some Users will attempt to cheat. Risks include:

• An opponent using script-driven prediction or external information you do not have;
• Two Users colluding to redirect Stakes between themselves through coordinated wins and losses;
• Coordinated timing of large external trades to influence the reference price feed during a Battle;
• Multi-accounting to gain matchmaking advantage or to bypass per-account limits;
• Fake-spectator pools designed to draw in legitimate Spectators on the wrong side.

ORACLX may void Battles, claw back payouts, adjust ELO, or terminate Accounts in response to detected manipulation, but cannot guarantee detection of every instance. You bear residual risk that some Battles you lose may have been against a manipulator who was not detected.

15. Regulatory & Legal Risk

Prediction markets, on-chain wagering, peer-to-peer derivatives, and related activities are regulated differently across jurisdictions. The legal status of the Service in your jurisdiction may be unclear, may change without warning, and may render the Service unlawful or inaccessible to you.

• You bear sole responsibility for determining whether your use of the Service is lawful in your jurisdiction.
• Regulatory action against ORACLX, its service providers, the underlying blockchain, the stablecoin issuer, or related infrastructure could disrupt the Service or freeze funds in flight.
• Sanctioned-persons lists may be enforced against your wallet address.
• You may become subject to know-your-customer, anti-money-laundering, or transaction reporting obligations as a result of using the Service.
• Court orders, civil suits, or criminal investigations affecting other Users may incidentally expose your activity through subpoenaed records or on-chain analysis.

ORACLX may, at any time, restrict or remove access to the Service from any jurisdiction in response to legal or regulatory developments.

16. Tax Risk

Your use of the Service may give rise to tax obligations in one or more jurisdictions. Common scenarios include:

• Capital gain or loss recognition on each Battle in which you commit and recover (or fail to recover) a Stake;
• Ordinary income on payouts in some jurisdictions;
• Reporting obligations for digital-asset transactions, even where no taxable event has occurred;
• Stablecoin appreciation/depreciation versus your home fiat currency.

ORACLX does not provide tax advice and (except where required by law) does not produce consolidated tax statements. You alone are responsible for tracking your transactions, calculating your taxable position, and filing accurate returns. Penalties for failure to do so are imposed by your tax authority, not by ORACLX.

17. Behavioral & Addiction Risk

The Service produces fast feedback loops, intermittent rewards, and social pressure (camera, chat, ELO, leaderboards) that some users may find compulsive. Sustained use beyond what you can comfortably afford — financially or psychologically — can cause harm independent of the financial outcome of any single Battle.

We urge you to:

• Set a fixed maximum amount you are willing to lose per session and per month, in advance, and stop when you reach it;
• Avoid using the Service while emotionally upset, intoxicated, or under unusual financial pressure;
• Treat losses as a sunk cost; do not "chase" them with bigger Stakes;
• Take breaks; remove the Service from your daily routine if you find yourself returning compulsively;
• Seek confidential help from a problem-gambling helpline in your jurisdiction if you are concerned about your use.

ORACLX may, at our discretion, impose cooling-off periods or close Accounts that exhibit signs of compulsive harm. Such measures are not guarantees of safety; they are imperfect signals.

18. Unrecoverable Outcomes & Irreversibility

Many of the events that can cause loss in the Service are irreversible. Among these:

• An on-chain transaction confirmed by the network cannot be undone, even if it was sent by mistake, even if it was sent to a contract with a bug, even if your account was compromised;
• A losing Battle is settled at the moment its win threshold is reached; ORACLX cannot "rewind" the Battle or refund a Stake based on subjective unfairness;
• A Stake committed to a now-paused or now-emergency-shutdown contract may take time to retrieve, if it can be retrieved at all;
• A leaked private key, recovery phrase, or email password generally cannot be "rotated" without manually moving funds to a new Wallet you have just created — and assumes the breach has not yet been exploited.

Plan for irreversibility before you act. Verify amounts and addresses. Sign with intention.

19. No Deposit Insurance, No Guaranty

The Service is not a bank, broker-dealer, insurer, or other regulated financial institution. Funds you commit to a Smart Contract for a Battle are not protected by any deposit- insurance scheme, government guaranty, securities-investor-protection fund, customer-asset-segregation requirement, or analogous regime. If ORACLX, our service providers, or the underlying contracts fail in any way that causes your Stake to become unrecoverable, you have no claim against any insurance fund or governmental backstop and your sole remedies are those described in our Terms of Service.

20. Risks May Evolve

The risks described in this Disclosure are not exhaustive and may change over time. New risks may emerge as technology evolves, as regulation develops, as ORACLX adds features, and as the broader ecosystem of providers we depend on changes. ORACLX may update this Disclosure at any time; the current version will always be posted at oraclx.net/legal/risk.

21. Your Acknowledgment

By using the Service, you acknowledge and agree that:

1. You have read and understood this entire Disclosure;
2. You understand that you may lose 100% of every Stake and every Spectator side bet, and that such losses may not be recoverable;
3. You are using the Service voluntarily, with funds you can afford to lose, in a jurisdiction where doing so is lawful for you;
4. You are not relying on any representation or warranty of ORACLX other than those expressly set out in our Terms of Service;
5. You have considered, and accept, every category of risk described above and any related risks not specifically enumerated;
6. You alone bear responsibility for your participation, your account security, your tax position, and your psychological well-being.