July 24, 2021
NO FRACTIONS YOU PURCHASE ARE EXPECTED NOR DESIGNED TO RETAIN ANY VALUE
Fractions (fractional ownership tokens) serve the purpose to increase participant access to collectable, provable ownership of digital art built on innovative technologies and their respective collector communities. Fractional does not condone the creation, buying, or selling of fractions as a means of investment.
The Fractional Token Company (referred to here as ‘Fractional.art’) provides a simple gateway and friendly GUI to interact with the fractional protocol which is a decentralized smart contract hosted and deployed on Ethereum mainnet, accessible to anyone with access to the Ethereum blockchain.
Abilities to purchase fractions on Fractional.art is enabled through the 0x API which aggregates ERC-20 tokens available on third-party decentralized exchanges, Fractional.art does not control or manage the liquidity pool balancing functions of the API, the actions of these third parties, or the supplying / removal of AMM pool liquidity
As a user of Fractional.art, you are individually responsible for your transaction decisions when you create, mint, buy, sell, or transfer any ERC-20 fractional ownership tokens (i.e. ‘fractions’) which represent NFTs. Fractional.art itself does not centrally store, host, or manage any NFT metadata, liquidity pools (LPs), automated market makers (AMMs), or ERC-20 trading markets.
Similarly, Fractional.art does not collect any transaction fees, and does not buy, sell, mint, own, issue, or distribute NFTs or fractions of NFTs. All fractionalization activity and fraction transactions are performed directly between NFT owners interacting with the fractional protocol and third-party APIs built into the site which connect to existing third-party intermediary platforms (e.g., OpenSea, Uniswap).
Curator, Collector, and Buyer Responsibility
Please consult and work directly with tax, legal, and financial professionals before making any NFT or NFT fraction creation, minting, transferring, and purchasing decisions.
Fractions represent collectable ownership of the underlying NFT, and Fractional.art does not condone the use, creation, or distribution of fractions as investment contracts. The Fractional Token Company, its officers, team, and community representatives are not registered financial advisors. All opinions shared on Twitter, Discord, or through other public channels are those of the respective individuals alone. Nothing discussed by employees of Fractional should be relied upon for financial decisions, nor is it financial advice.
Additionally, Fractional.art does not control, govern, or maintain responsibility for:
- Who can fractionalize ERC-721 NFTs
- Which ERC-721 NFTs can be fractionalized
- The total supply of fractions (ERC-20 tokens) minted
- The reserve price, fraction supply, or token name associated with new and existing vaults
- The intermediary platforms, or networks, through which fractions can be transferred, purchased, or sold
- The intermediary platforms and methods vault creators utilize to distribute and manage their fractions which include, but not limited to, dAPPs DEXs, wallets, and AMMs
- The methods and messages by which vault creators (e.g., curators) choose to market their fractions (e.g., giveaways, ads, media, descriptions)
- The methods and messages by which fraction owners transfer or manage their respective fraction supplies, including, but not limited to, providing sufficient liquidity in AMM pools on decentralized exchanges such as Uniswap or Sushiswap*
- The outcomes resulting from any of the activities and decisions listed above
By buying and owning fractions, you acknowledge and accept that:
- The underlying fractionalized art, like any digital or physical art, may fluctuate in value in unpredictable ways
- Fraction supplies may have an annual supply inflation [i.e. curator fee] distributed to the curator, which is a depreciating mechanism on the value of the fractions. Owners of fractions are not guaranteed, nor should expect, any net value appreciation of the underlying NFT collectable or protections against loss
- Triggering an auction is the mechanism to re-unify the NFT(s) for someone to acquire an entire vault, and this cannot be halted or stopped once it is triggered
- Past price and purchasing activity trends are not indicative of future trends, and are not a proxy for historical or projected future valuation of any specific NFT or fractional ownership tokens
The tax treatment to which the collector will be subject to is uncertain. The Fractional Token Company does not make any representation as to whether any tax consequences may arise from purchasing, owning, or transferring fractions.
Given this project is in its early stages of development. Unforeseen circumstances might prevent the continued maintenance or completion of Fractional's goals in whole or in part. Acquiring and owning fractions involve various risks, in particular, that the buyer may not be able to find a seller. Prospective fraction collectors should carefully consider the risks, costs, and benefits, and understand the underlying mechanisms. Purchasers fully accept all types of related risks involved with new technology and blockchain-based tokens.
The only rights granted in respect of the fractions are to own, transfer and use the fractions in respect of the respective NFT's community ecosystem as it relates to their treatment and recognition of fractions. Fractions do not confer any other rights, use, purpose or features, whether expressed or implied.
Fractions are not to be deemed or interpreted to be representative of any kind of:
- Currency, legal tender, money or deposit
- Investment (whether secured or unsecured), equity interest, proprietary interest and economic rights
- Equity, debt or hybrid instrument, security collective investment scheme managed fund, financial derivative, futures contract, deposit, commercial paper, negotiable instrument, investment contract, note, bond, warrant, certificate or instrument entitling the holder to interest, dividends or any kind of return, nor any other financial instrument; or...
- right, title, interest or benefit whatsoever in whole or in part, in any person or property, or any assets
Fractions are not guaranteed or secured by any person, asset or entity in any way. The team is not under any obligation to issue replacement fractions if fractions are lost, stolen, destroyed, or otherwise inaccessible for any reason.
Blog Posts and Publications:
Publications from Fractional.art and fractional employees are solely for information and entertainment purposes only. Due to the constant evolving nature of laws, governmental policies and regulations and other factors, the information contained in the fractional publications may not be accurate, reliable, or final, and is subject to change.