What is Kusama?

Kusama serves as a public pre-production environment for Polkadot, functioning as a sandbox where developers can experiment and test new blockchains or applications. This setup allows for the testing of early versions of Polkadot projects with real cryptocurrency on an open market, ensuring that projects are refined and effective before their official release. Furthermore, upgrades intended for Polkadot are first trialed on Kusama, reinforcing its role as a critical testing ground.

Kusama is designed to offer developers more flexibility as they finalize their Polkadot projects, providing looser rules and less stringent governance parameters compared to Polkadot. This environment supports a wide range of innovations while still mirroring many of Polkadot’s core architectural features, such as using a main relay chain for permanent transactions and allowing user-generated networks, or parachains, that can be customized for various uses while leveraging the main chain’s security. Launching a project on Kusama can be advantageous as it allows developers to build a user base and gain traction within the community before a full-scale launch on Polkadot.

What is KSM?

The KSM token is the native cryptocurrency of the Kusama network and is central to its operation. It is used by participants for several key activities, including governance, where token holders vote on proposed network changes and upgrades. KSM is also essential for staking, a process that helps secure the network by allowing token holders to support validators, who maintain the blockchain's integrity. Additionally, KSM is used to pay for transaction fees and to bond parachains—specialized blockchains that connect to Kusama’s main network. The supply of KSM is inflationary, designed to encourage participation and investment in the network. This inflation adjusts based on how much of the total token supply is staked, ensuring a balance between incentivizing token holders and maintaining network security. Through these uses, KSM facilitates not only network operations and security but also the broader economic activities that sustain the Kusama ecosystem.

Risk Statement

Before trading any crypto assets it is important to understand the risks. This overview is a starting point for you to perform your own research prior to investing in a crypto asset. 

No securities regulatory authority or regulator in Canada has evaluated or endorsed the Crypto Contracts or any of the crypto assets made available through the platform. 

Wealthsimple has performed an assessment of whether CVX can be supported by Wealthsimple’s platform, including whether CVX is a security and/or a derivative and is being offered in compliance with securities and derivatives laws.

We evaluated CVX based on publicly available information, including (but not limited to):

• The creation, governance, usage and design of CVX, including the source code, security and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that first created CVX;
• The supply, demand, maturity, utility and liquidity of CVX;
• Material technical risks associated with CVX, including any code defects, security breaches and other threats concerning CVX and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them;
• Legal and regulatory risks associated with CVX, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of CVX; and
• Statements made by regulators or securities regulatory authorities in Canada and other jurisdiction regarding whether CVX, or generally about whether the type of crypto asset, is a security and/or a derivative.

Wealthsimple monitors ongoing developments related to crypto assets available on its platform for significant changes that may affect Wealthsimple’s original assessment of those assets, including Wealthsimple’s assessment of the application of securities and derivatives laws. Any significant changes relating to CVX may result in changes to this Crypto Asset Statement and/or Wealthsimple’s ability to support CVX.

Like all other crypto assets, there are some general risks to investing in CVX. These include short history risk, volatility risk, liquidity risk, demand risk, forking risk, cryptography risk, regulatory risk, concentration risk, electronic trading risk and cyber security risk. Please review the Wealthsimple Crypto Product Risk Disclosure for additional discussion of general risks associated with the crypto assets made available through the platform.

We emphasize that this Crypto Asset Statement is not exhaustive of all risks associated with trading CVX. Investors should perform their own assessment to determine the appropriate level of risk for their personal circumstances.

Wealthsimple is offering Crypto Contracts in reliance on a prospectus exemption contained in the exemptive relief decision Re Wealthsimple Investments Inc. dated December 18, 2023 (the Decision). 

The statutory rights of action for damages and rescission in section 130.1 of the Securities Act (Ontario), and, if applicable, similar statutory rights under securities legislation of other jurisdictions of Canada, do not apply in respect of this Crypto Asset Statement to the extent a Crypto Contract is distributed under the prospectus relief in the Decision.

Last updated: October 14, 2025