Nasdaq 100 50% Upside Tracker Token

The Nasdaq 100 50% Upside Tracker is a one-year structured note token that combines equity exposure with downside protection. It offers returns linked to the Nasdaq-100 index – a benchmark of the 100 largest non-financial Nasdaq-listed companies – with a 50% maximum gain cap and 100% principal back at maturity. In practice, most of the invested capital is allocated to a low-risk bond (to secure the principal) and the remainder buys a Nasdaq-100 call option (to capture upside). At maturity the smart contract redeems each token: investors receive their full principal plus any index gains up to 50%; if the index is flat or down, they still get their original investment back. The token is fully collateralized by Slice’s reserves and is issued on a public blockchain (e.g. Ethereum or Solana) for transparent, 24/7 settlement.

How It Works

• Bond Component: A large portion of each investment buys a fixed-income instrument (e.g. a zero-coupon bond) that will mature at the token’s face value. This funds the 100% principal guarantee.

• Option Component: The remaining funds purchase a Nasdaq-100 call option that pays off if the index rises. This provides upside participation up to the 50% cap.

• Blockchain Issuance: The structured note is minted as a digital token on a public blockchain. Smart contracts automate issuance and redemption, eliminating paper processes and reducing intermediaries.

• Maturity Settlement: At the 1‑year maturity, the token’s smart contract pays each holder either: (a) principal + up to 50% gain (if Nasdaq-100 is higher), or (b) 100% principal only (if Nasdaq-100 did not rise enough). This logic is embedded in the contract’s payout formula.

This design means you participate in Nasdaq-100 gains (with a 50% cap) without risking your initial capital during the term. Because the note is held via blockchain, ownership can be transferred on-chain and any payouts are executed automatically by code.

Capital Guarantee Mechanism

Slice backs the 100% principal guarantee using off‑chain reserves and smart contracts. In effect, investor deposits are held in secure assets (like cash or high-grade bonds) that equal 100% of outstanding tokens, similar to how fiat‐backed stablecoins hold dollar reserves. These reserves are custodied and (ideally) audited, assuring full backing of the token’s face value. On-chain, a smart contract enforces this guarantee: it will always redeem each token at its face value at maturity. In other words, the bond component of the structured note ensures return of principal, and the smart contract automates the payout. Important: this guarantee depends on Slice (the issuer) remaining solvent and honoring its obligations – if the issuer defaults, protection could fail.

Benefits

• Principal Protection: 100% of your invested capital is guaranteed at maturity (if held to term). Your downside risk is limited to forgoing any upside.

• Enhanced Upside: You can earn up to 50% return if the Nasdaq-100 rallies strongly, capturing growth in large-cap tech and other Nasdaq sectors. This upside is much greater than what a safe bond would pay, due to the option component.

• Low Minimum & Fees: You can invest with just $50. The annual management fee is only 0.75%, and there are no performance, entry, or exit fees. This fee structure is simpler and often lower than many traditional structured products.

• Digital Liquidity: As a blockchain token, you benefit from 24/7 global trading. The structure replaces slow paper processes with programmable smart contracts. You can trade tokens on Slice’s secondary marketplace before maturity.

• Transparent Settlement: Every token and transaction is on-chain. You can verify holdings and payouts directly on the public ledger, improving transparency and trust.

Risks

• Issuer Credit Risk: The guarantee is only as strong as Slice’s balance sheet. If Slice were to become insolvent or default, you could lose some or all of your capital. This is the central counterparty risk of principal-protected notes.

• Limited Liquidity: There is no guaranteed market for these tokens. Early redemptions are at prevailing market prices, which could be significantly below face value. Structured notes often have low liquidity, so selling tokens before maturity could lock in a loss.

• Capped Upside: You give up any Nasdaq gains beyond 50%. In a skyrocketing market, you miss out on additional profits above the cap.

• Market Risk: If the Nasdaq-100 index does not rise, you will receive no profit (only your principal back). This note has no downside participation – it simply protects your capital rather than insuring against index drops. You do not earn dividends or interest during the year.

• Blockchain/Token Risk: As a digital asset, tokens are subject to cyber risks (smart-contract bugs, network congestion). Regulatory changes affecting crypto securities could also impact tradability.

Investors should read all product documents and ensure they understand these factors before investing.

Product Features

Example Scenarios

• Nasdaq 100 up 20%: The token gains ~20%. E.g. a $1,000 investment would yield about $1,200 at maturity (a $200 profit).

• Nasdaq 100 up 100%: The token is capped at +50%. The $1,000 becomes $1,500 (a $500 profit) – you do not capture beyond 50%.

• Nasdaq 100 flat or down: You receive $1,000 back (principal only, 0% profit). Any decline in the index does not reduce your principal.

• Nasdaq 100 down 30%: Same outcome – you get your $1,000 back. The negative market return is absorbed by the guarantee.

(These simplified examples assume holding to maturity and ignore the 0.75% fee impact. Early exit values would depend on market quotes.)

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