Rule Type: Platform Trading Risk Control Rules

Applicable Product: BitNasdaq Contract Insurance Pool

Applicable Users: All users who meet the requirements and successfully purchase contract insurance

Effective Date: January 15, 2026

Chapter 1 | Rule Overview

The Contract Insurance Pool is a contract trading risk-management tool launched by BitNasdaq. It provides partial compensation for losses incurred during contract trading under specified conditions.

Users must purchase insurance before opening any contract position. During the insurance validity period, when the account’s cumulative contract loss reaches compensation trigger conditions defined in these rules, the system will automatically execute compensation in accordance with the rules.

Chapter 2 | Scope of Insurance

2.1 Insurance Coverage

The insurance will cover the following future contract trading categories (subject to actual availability on the platform):

• Cryptocurrency contracts

• Commodity contracts

• Stock contracts

• Forex contracts

• Index contracts

2.2 Insurance Period

• Single insurance period: 24 hours

• Longer insurance periods may be gradually introduced based on system performance and operational conditions

Chapter 3 | Insurance Purchase Rules

3.1 Purchase Timing Requirements

• Users must purchase insurance before opening any contract positions.

• If there are any open contract positions in the account, insurance purchase will not be permitted.

• Before purchasing new insurance, all contract positions must be fully closed.

3.2 Effective Rules

• Contract insurance becomes effective immediately after the insurance fee is paid.

• Insurance only covers profits and losses generated after the insurance becomes effective.

• Any profits or losses generated before the insurance becomes effective are not covered.

Chapter 4 | Insurance Fee Rules

4.1 Insurance Fee Tiers and Compensation Trigger Standards

Users may select an insurance tier based on their risk preference and purchase insurance in integer multiples (N) of the minimum unit for each tier.

Notes:

• The compensation trigger condition for each tier equals (minimum insurance amount × N × 10) in cumulative contract losses

• Insurance fees must be paid in integer multiples (N) of the minimum amount for the selected tier

• Whether a claim is actually triggered is determined by multiplying the actual amount of insurance paid by the user by 10, which is the final claim trigger value.

4.2 Profit Settlement Fee

If the account result during the insurance period is profitable, the system will process fees as follows:

1. The system compares the following two amounts:

• Insurance fee paid before opening positions

• 10% of the profit generated during the insurance period

2. The higher amount will be taken as the final insurance cost.

3. If 10% of the profit ≤ insurance fee already paid, no additional fee is charged.

4. If 10% of the profit ＞ insurance fee already paid, 10% of the profit will be charged and the originally paid insurance fee will be refunded.

Chapter 5 | Insurance Amount and Compensation Rules

5.1 Compensation Method

The Contract Insurance Pool adopts a fixed compensation ratio mechanism.

• Compensation Amount = Compensation Trigger Value × 50%.

• All compensation is distributed in the form of Hashrate, generated by BNQ Mining. Users must purchase Mining Machines separately.

• Compensated Hashrate will be credited to the user’s Hashrate system according to the platform’s current rules.

5.2 Compensation Trigger Rules

Basic Trigger Conditions

• The minimum insurance fee is 1 USDT.

• When cumulative contract losses during the insurance period reach or exceed insurance amount × 10 (the trigger value), compensation is triggered.

Compensation is calculated uniformly as:

• Compensation Amount = Trigger Value × 50%

• If the trigger value is not reached, no compensation will be issued.

5.3 Important Notes

1. Compensation determination is based solely on total cumulative contract losses during the insurance period.

2. Cumulative losses include:

• Realized PnL from closed positions

• Unrealized floating PnL from open positions

3. Single losses or short-term price fluctuations do not constitute independent compensation triggers.

4. If compensation conditions are not met, the insurance will expire automatically at the end of the period without compensation.

Chapter 6 | Settlement and Compensation Logic

6.1 Settlement Time

• The system performs settlement automatically after 24 hours from insurance activation.

6.2 Settlement Scope

• Floating PnL

• Realized PnL

6.3 Settlement Reference

• Settlement prices are based on the Mark Price during the insurance period.

6.4 Settlement Result Handling

• Trigger conditions met → Corresponding BNQ hashrate compensation is issued

• Overall result is profitable → Profit settlement fee is processed according to Article 4.2

• Trigger conditions not met → Insurance ends naturally with no compensation

6.5 Compensation Release and Freeze Rules

• All triggered compensation amounts are subject to a linear release mechanism.

• Compensation is released evenly over 30 days, at a daily rate of 1/30.

• If a user fails to purchase any contract insurance for 5 consecutive calendar days after compensation is triggered, the system will freeze the unreleased portion of the compensation.

• During the freeze period, unreleased compensation will be suspended and cannot be used or calculated for any purpose.

• Once the user purchases contract insurance again, the freeze will be automatically lifted, and the remaining unreleased compensation will continue to be released according to the original 30-day schedule.

• Compensation already released is not affected by the freeze rule.

Chapter 7 | Insurance Status Definitions

• Active: Insurance is within the 24-hour validity period

• Compensation: Compensation conditions have been triggered and are being processed

• Frozen: Unreleased compensation is frozen due to 5 consecutive days without insurance purchase

• Completed: Compensation fully released or insurance period ended

Chapter 8 | Risk Disclosure and Disclaimer

1. The Contract Insurance Pool is a risk-management tool and does not constitute any form of profit or principal guarantee.

2. Compensation does not equate to full reimbursement of all trading losses.

3. In extreme market conditions, system abnormalities, or forced events, the platform reserves the right to implement necessary risk-control measures.

4. Users must fully understand the high-risk nature of contract trading and participate rationally.

Chapter 9 | Supplementary Provisions

These rules are uniformly enforced across the BitNasdaq platform.

BitNasdaq reserves the final right of interpretation of the Contract Insurance Pool rules.

The platform may adjust these rules based on market conditions and system operations, with advance notice provided.