Risk Disclosure Statement
Last Updated: 01.08.2025
This Risk Disclosure Statement (the “Statement”) is provided by Neverwinter Fund I SLP (the “Fund”) to inform prospective and existing investors of the nature and scope of the risks involved in an investment in the Fund.
The Fund is established in Luxembourg as a special limited partnership (société en commandite spéciale) and is managed by Neverwinter Management Sàrl, registered as an Alternative Investment Fund Manager (AIFM) with the Commission de Surveillance du Secteur Financier (“CSSF”) pursuant to Article 3(2) of the Luxembourg law of 12 July 2013 on alternative investment fund managers, as amended (the “AIFM Law”).
Investment in the Fund is open only to well-informed investors within the meaning of the AIFM Law and is not suitable for the general public.
1. No Guarantee of Returns
An investment in the Fund is speculative and involves a high degree of risk. There can be no assurance that the Fund’s investment objectives will be achieved or that investors will receive any return on their capital. Past performance of the Fund, its General Partner, Bitcoin or any cryptocurrency’s price development or any trading strategy employed is not indicative of future performance.
2. Capital Loss Risk
The value of an investment in the Fund may fluctuate significantly due to market conditions, trading results, and other factors. Investors may lose all or a substantial portion of their committed and contributed capital. The Fund’s trading strategies involve both gains and losses, and the magnitude of losses may exceed initial expectations.
3. Market Risk
The Fund primarily trades crypto assets and related derivatives, which are subject to high volatility, limited liquidity in certain market conditions, and significant short-term price fluctuations. Macro-economic developments, regulatory changes, technological disruptions, or market sentiment shifts may materially affect asset prices and trading results.
4. Digital Asset & Blockchain-Specific Risks
Investing in digital assets carries unique risks, including but not limited to:
Technological risk: Vulnerabilities in blockchain protocols, smart contracts, or cryptographic systems may result in loss or theft of assets.
Custody risk: While the Fund uses institutional-grade self-custody solutions, no system is entirely immune from cyberattack, theft, or operational failure.
Market structure risk: Crypto exchanges are less regulated than traditional markets, and may experience downtime, trading halts, insolvency, or adverse changes in listing policies.
Regulatory risk: Laws and regulations applicable to crypto assets are evolving rapidly. New rules may restrict or prohibit certain trading activities, impact liquidity, or require costly compliance measures.
5. Counterparty Risk
The Fund’s activities involve trading with multiple counterparties, including exchanges, brokers, liquidity providers, and custodians. The insolvency, default, or operational failure of any counterparty may result in significant financial loss to the Fund.
6. Operational and Technology Risk
The Fund relies on proprietary trading algorithms, data feeds, and technology infrastructure. Any malfunction, software error, cyberattack, or data integrity issue could impair trading operations, result in losses, or prevent timely execution of trades. While the Fund employs robust cybersecurity and disaster recovery protocols, residual risk cannot be eliminated.
7. Liquidity Risk
Certain assets or positions held by the Fund may be illiquid or subject to trading restrictions, especially during periods of market stress. The Fund may be unable to exit positions promptly or at favorable prices, which could adversely affect performance and investor redemption timelines (if applicable under the LPA).
8. Valuation Risk
The valuation of crypto assets and derivatives may be complex, particularly for illiquid instruments. Pricing sources may be limited, and valuations may differ materially from realizable market prices. The Fund’s Net Asset Value (NAV) is calculated according to the valuation procedures described in the Limited Partnership Agreement, which may involve estimation and discretion.
9. Regulatory and Tax Considerations
Investors are responsible for understanding the legal, regulatory, and tax consequences of their investment in the Fund in their own jurisdiction. The Fund operates under Luxembourg law but invests in global markets, which may expose it to cross-border legal and compliance risks. Tax treatment of crypto assets varies widely between jurisdictions and may change without notice.
10. Restricted Investor Eligibility
The Fund is not marketed to, and may not be invested in by, retail investors or any person who does not meet the criteria of a “well-informed investor” under Luxembourg law. The Fund is not registered under the U.S. Investment Company Act of 1940, and interests in the Fund are not registered under the U.S. Securities Act of 1933. Interests may not be offered or sold to “U.S. Persons” except as permitted by applicable exemptions.
11. No Advice
Nothing on this website, in this Statement, or in the Fund’s marketing materials constitutes investment advice, legal advice, or tax advice. Prospective investors should obtain independent professional advice before making any investment decision.
Important: By investing in Neverwinter Fund I SLP, you acknowledge that you have read and understood this Risk Disclosure Statement, the Private Placement Memorandum, and the Limited Partnership Agreement, and that you are prepared to bear the risks described herein.
