Risk Disclosure

Trading on Fun Coupons is high risk. Every position can lose all of its collateral, and at high leverage that can happen within seconds. Most high-leverage positions end in liquidation. Only use money you can afford to lose completely.

Depositing into the pool is also high risk. The pool pays winning traders, so a deposit can fall in value and can lose most or all of its value.

Leverage multiplies every price move. At 100x, a 1% move against you equals your whole collateral. At 1000x, a 0.1% move does. Your position is liquidated before it reaches that point, once what is left falls to the market's maintenance margin.

Costs are multiplied too. Fees and the spread are charged on your position size, not on your collateral. At 1000x, a spread of 0.01% costs 10% of your collateral when you open and another 10% when you close, before any price move. The holding fee accrues every second on the full position size, so the liquidation price moves closer to the market the longer you hold.

When a position's remaining value reaches the maintenance margin, anyone can liquidate it. The caller takes a bounty from your collateral. Whatever value the position still has after the bounty comes back to you, and the pool keeps the rest of the collateral. Closing the position yourself before that point returns more than being liquidated.

A liquidation is not a stop-loss that protects the rest of your collateral. By the time it happens, most of the collateral is gone. If the price gaps, it can all be gone.

The contracts don't use an external price oracle. Each stock's price comes from its Uniswap v3 pool on Robinhood Chain, where the stock token trades against USDG. The contracts read a time-weighted average from the pool's history and the pool's current price, and generally settle at whichever of the two is worse for you. Opening is refused when the current price is too far from the average.

• Pool prices move with the trades in the pool. A large trade, or someone deliberately pushing the price, can move the price your position is valued at, including into liquidation. The shallower the pool, the easier that is.
• The time-weighted average lags the market. In a fast move, the price you see on a stock exchange and the price the contracts use can be far apart.
• Stock tokens trade around the clock, including when US stock markets are closed. Their price can move on weekends and overnight while the real stock doesn't, and can jump when the market opens.
• A stock token's price can differ from the real stock's price for other reasons, including how the token is issued and backed. We don't control the tokens or their issuers.
• If the contracts can't read a fresh price, closing and liquidation can settle at the last price they saw, moved against whoever is acting, for up to 7 days. After that, settlement stops until a fresh price is available.

Smart contracts don't act on their own. Liquidations, take-profit orders and stop-loss orders only happen when someone sends a transaction. We run a keeper that does this, and anyone else can run one, but nothing guarantees a keeper is running at any moment. If none is, positions that should be closed stay open and can lose more.

A triggered order closes at the price when it executes, not the price you set. If the price jumps past your level, you get the new price. If it jumps past both your stop and your liquidation price, the position is liquidated instead. The keeper that executes an order is paid a fee from your payout, currently set by the contract owner and never more than 0.5% of your collateral.

All collateral, profit and loss is in FUN. A winning trade pays more FUN, but what that FUN is worth in dollars depends on FUN's own market price, which moves independently of the stock you traded. FUN can lose most or all of its value, and its market can be thin, so selling a large amount can move the price against you.

Other tokens use the FUN ticker. Buying the wrong one is a common mistake and can't be undone. Check the contract address on the $FUN page.

Profit is paid from the first-loss cushion first and then from the pool. Both hold a limited amount of FUN. If they don't hold enough when you close a winning position, you are paid what is available, and the rest is not paid later.

• The pool is the counterparty to every trade. When traders win, the pool's value falls. One large winning trade can cost depositors a lot.
• Deposits and withdrawals wait 24 hours after the request and must be completed within the following 48 hours. Each completes at the worse of the share price at request and the share price at completion. You can't leave quickly, and the price can fall while you wait.
• A deposit can't complete while open winning positions are owed more than the pool and cushion hold. Deposits can also be closed by the contract owner.
• Fee income is not guaranteed. It depends on how much trading happens and on market settings the owner can change.
• Your deposit is in FUN, so its dollar value also moves with FUN's price.

The contracts are code, and code can have bugs. They have been tested but have not been audited by an independent security firm. A bug or an exploit could lose or lock the funds in positions, the pool and the cushion, and there may be no way to recover them.

The contracts also depend on code we don't control: Uniswap, Permit2, the FUN and stock token contracts, Pons, and Robinhood Chain itself.

One wallet, controlled by the team, owns the contracts. It can pause new positions, close deposits, change a market's leverage limit, fees and position limits, change the keeper fee, and change which pool a stock's price is read from. These powers are there to manage risk, but a mistake or a stolen key could harm traders and depositors. The Terms of Use list them in full.

• Robinhood Chain can slow down or stop producing blocks. Transactions can fail, get stuck or cost more than expected, and you pay network fees even when a transaction fails.
• The site and the RPC services it reads from can go down or show stale data. While they do, you may not be able to see or close your positions through the site, and your positions can still be liquidated.
• Anyone with your seed phrase or private key controls your funds. Lost keys can't be recovered. Fake sites and fake support accounts target people who trade on-chain. We will never ask for your seed phrase or private key.
• Confirmed transactions are final. Nobody can reverse a trade, a liquidation or a transfer.

Leveraged products and tokenized stocks are regulated, restricted or banned in many places, and laws change. A change could make the site or the tokens harder to use or unavailable to you. You are responsible for following the law where you are and for any tax on your trades, deposits and withdrawals.

This page describes the main risks. It is not a complete list, and it is not financial, investment, legal or tax advice. Nothing we publish promises a profit. If you are unsure whether this is right for you, don't use it.