Risk Disclosure

Understanding Risks

Targets are not guarantees. Results can vary materially with market and operational conditions, including periods of severely reduced returns or losses.

Variable Returns Smart Contract & Token Risk Liquidity & Exit Regulatory Change

Overview

Investing with Livsquare involves risk, including the possible loss of capital. Target distributions communicated elsewhere (e.g., 6 months 4%, 12 months 4.5%) are purely indicative and depend on asset performance, market conditions, liquidity, fees and other factors. Performance can deviate materially from targets and may be lower than bank deposit rates during adverse periods.

Return Volatility

Returns are variable. Under challenging market or operational conditions, annualised returns may be significantly reduced and can approach very low single digits. In severe scenarios, net results may decline to approximately 1% per annum or negative, and losses of capital are possible.

Market & Macroeconomic Risks

  • Interest Rates: Increases can depress property values and reduce refinancing options.
  • Demand Shocks: Travel, employment or regulatory shocks can reduce occupancy and pricing power.
  • Credit & Liquidity: Tighter credit conditions can impair acquisitions and exit routes.
  • Geopolitical/Force Majeure: Conflicts, pandemics or natural disasters can disrupt operations.
  • Market Cyclicality: Real estate is cyclical; downturns can be prolonged and uneven by sub-market.

Property-Specific Risks

  • Vacancy & Delinquency: Cash flows may underperform projections.
  • Capex & Maintenance: Unexpected repairs and compliance upgrades can erode returns.
  • Zoning/Regulatory: Short-let restrictions, licensing or tax changes may limit strategies.
  • Valuation Risk: Appraisal uncertainty; forced sales can realise lower values.
  • Concentration: Exposure to specific cities, segments or operators increases variance.

Operational Risks

  • Partner/Counterparty: Performance of distributors, facilities and vendors impacts outcomes.
  • Pricing Engines: AI-assisted pricing may misestimate demand or react sub-optimally.
  • Cyber & Data: Breaches, outages or third-party failures may interrupt services.
  • Key Person/Execution: Delays or errors can reduce realised returns.

Tokenisation & Smart Contract Risks

  • Contract Vulnerabilities: Bugs, exploits or oracle failures can impair functionality or funds.
  • Network Risks: Congestion, forks, validator failures and fee spikes can delay actions.
  • Custody: Loss of private keys or compromised wallets may lead to irreversible loss.
  • Legal Characterisation: Changing interpretations of tokenised interests may affect rights or transferability.
  • Secondary Liquidity: No assurance of a robust secondary market; slippage and wide spreads are possible.

Where lock-ups apply, capital is recorded inside a smart contract for the selected term (6 months or 12 months). Early unlock is not guaranteed. If available, an on-chain exit request may be initiated and typically requires 7–15 days to process, carries a 25% early-exit penalty on principal or accrued entitlements as stated in product documents, and may be rejected where capacity is unavailable. Re-entry after exit is not assured.

Liquidity, Redemptions & Exit

  • Lock-Ups: Terms restrict redemptions until maturity; early exits incur penalties if offered.
  • Funding Mismatch: Underlying assets are illiquid; matching redemption flows may be delayed.
  • Gate/Queue: We may gate, defer or pro-rate exits during stress to protect investors equitably.

FX, Inflation & Rate Risks

  • Currency: If funding or distributions occur in a currency different from your base, FX moves can reduce effective returns.
  • Inflation: Real returns may be materially below targets after inflation.
  • Refinancing: Higher rates can increase costs and reduce distributable income.

Distributions

Where products aim to pay monthly distributions, the schedule targets the first five calendar days of each month after income is generated. Payments are not guaranteed and may be reduced, delayed or suspended at our discretion due to liquidity, operational or legal considerations. Amounts credited to your account may be transferred out or re-allocated subject to product terms, fees and any applicable holds.

Illustrative Stress Scenarios

ScenarioDriversIllustrative Outcome
Demand Shock Tourism slowdown, platform policy changes, city-level restrictions Occupancy falls, yields compress; annualised returns 1%–3%, potential negative months
Rate Spike Rapid interest-rate increases and tighter credit Asset values down, refinance terms worsen; reduced or suspended distributions
Operational Disruption Vendor failure, cyber event, legal dispute Temporary suspension of payouts; remediation costs reduce returns
Token/Network Stress Chain congestion, contract issue, custody loss Delays in transfers/exits; potential permanent loss if keys compromised

These scenarios are examples only, not predictions. Actual outcomes can be better or worse.

Investor Responsibilities

  • Review product-specific documents, fee schedules and risks before allocating.
  • Ensure suitability in light of objectives, horizon and loss tolerance.
  • Maintain current KYC/KYB, source-of-funds evidence and banking/wallet details.
  • Monitor allocations, FX exposure and tax obligations relevant to your jurisdiction.

No Advice; Not an Offer

Nothing on this page constitutes investment, legal, tax or accounting advice, nor an offer or solicitation to the public. Consult independent professional advisers before making decisions.

Partners & Distribution

Airbnb
Booking.com
Expedia
Tripadvisor