Token Utility & Non-Security Disclosures

Token Utility Overview

CANNACOIN is a functional utility token designed to facilitate transaction settlement, escrow, accounting, and incentive mechanisms within a closed-loop digital payments ecosystem supporting compliant cannabis and hemp commerce.

The token’s utility is consumptive in nature and is required for specific platform functions, including:

• Payment settlement between licensed participants
• Escrow-based transaction workflows
• Transaction fee processing within the platform
• Access to platform-level accounting and reporting features
• Participation in network incentive mechanisms unrelated to profits or revenue sharing

CANNACOIN does not represent ownership, equity, voting rights, dividends, revenue participation, or any claim on assets or earnings of the platform, its operators, or affiliated entities.

Consumptive Use Requirement

CANNACOIN is intended to be used, not held for speculative purposes.

Token acquisition is for the purpose of:

• Accessing payment and settlement functionality
• Covering network transaction fees
• Enabling compliant participation in platform services

The platform does not promote token appreciation, secondary market trading, or financial returns. No statements are made regarding future token value, price stability, or market performance.

Non-Security Statement (SEC Alignment)

CANNACOIN is not a security under U.S. federal securities laws and is not intended to be an investment contract.

Specifically:

• No funds are raised for capital formation
• No expectation of profits is created or promoted
• No reliance on managerial or entrepreneurial efforts of others for financial return
• No revenue, profit, or dividend distribution is associated with the token

The token is designed to satisfy functional utility requirements rather than investment characteristics, consistent with SEC guidance on digital assets with consumptive use.

No Profit or Revenue Participation

Holding or using CANNACOIN does not entitle participants to:

• Profits generated by the platform
• Revenue derived from cannabis or hemp commerce
• Platform fees or treasury growth
• Governance rights related to financial outcomes

Any platform-level fees collected are used solely for:

• Network maintenance
• Compliance operations
• Liquidity and settlement functionality
• Infrastructure and security

These fees do not accrue to token holders.

FinCEN & Financial Crimes Compliance

CANNACOIN is designed to operate within applicable financial-crime compliance frameworks, including:

• Anti-Money Laundering (AML) standards
• Know Your Customer (KYC) requirements for merchants
• Transaction monitoring and recordkeeping
• Suspicious activity reporting where applicable

The platform does not enable anonymous settlement for regulated cannabis transactions and does not facilitate evasion of banking, tax, or reporting obligations.

CANNACOIN is not designed to function as a privacy coin or anonymization tool.

Banking & Underwriting Risk Controls

From a banking and underwriting perspective, CANNACOIN incorporates the following risk-mitigation principles:

• Stablecoin-paired settlement to reduce volatility
• Transparent, auditable on-chain transaction records
• No custody of cannabis inventory
• No facilitation of interstate cannabis commerce
• No commingling of funds between licensed and unlicensed entities

The platform functions as payment infrastructure, not a cannabis operator, distributor, or retailer.

No Investment Marketing or Financial Promotion

CANNACOIN is not marketed, sold, or promoted as:

• An investment opportunity
• A store of value
• A yield-generating asset
• A profit-sharing mechanism

All marketing materials, documentation, and platform communications emphasize utility, compliance, and operational functionality rather than financial performance.

Regulatory Adaptability

The platform is designed to adapt to evolving regulatory frameworks without reliance on assumptions of:

• Federal legalization
• Cannabis descheduling
• Regulatory forbearance

Should regulatory requirements change, the platform may modify or restrict token functionality to maintain compliance.

Risk Disclosure

Participants acknowledge that:

• Regulatory frameworks for digital assets and cannabis may evolve
• Token utility may be limited or restricted by regulatory action
• Access to services may vary by jurisdiction
• Use of the platform requires compliance with applicable laws

CANNACOIN does not guarantee uninterrupted access, token liquidity, or continued regulatory acceptance.

Summary

CANNACOIN is a compliance-first utility token designed for operational use within a regulated payments environment. It does not confer investment rights, profit participation, or ownership interests and is structured to align with SEC, FinCEN, and financial-institution risk frameworks.