Terms of Staking | ELSOUL LABO B.V.

Terms and Conditions for ELSOUL LABO B.V. Staking Service Provider and Investor

These Terms and Conditions for ELSOUL LABO B.V. Staking Service Provider and Investor (“Terms”) are entered into by and between ELSOUL LABO B.V. (“ELSOUL LABO B.V.”) and the user (“User”), and they govern the client-service relationship related to staking services provided via https://labo.elsoul.nl (the “Service”).

By delegating Tokens to ELSOUL LABO B.V., the User agrees to be bound by these Terms. If the User does not agree to or cannot comply with these Terms, the User must not delegate Tokens to ELSOUL LABO B.V. Please read these Terms carefully before delegating.

For any questions or issues, please contact us at [email protected].

In consideration of the mutual agreements set forth below, ELSOUL LABO B.V. and the User hereby agree as follows:

Article I: Definitions and Rules of Interpretation

Section 1.1 Certain Definitions and Rules of Interpretation

The following definitions apply whenever they appear in these Terms:

Affiliate: Any person or entity directly or indirectly controlling, controlled by, or under common control with another person or entity.
Block Rewards: Newly minted tokens that increase the total supply of tokens on a network.
Disputes: Has the meaning set out in Section 6.2.
Governmental Authority: Any nation or government, or any state, political subdivision, agency, or instrumentality thereof, including entities that exercise legislative, judicial, or administrative authority (e.g., government departments, boards, commissions, self-regulatory organizations, courts, tribunals, etc.).
“hereof,” “herein,” “hereunder,” “hereby”: Unless otherwise stated, these terms refer to these Terms as a whole and not to any specific section or provision.
“include(s)” and “including”: Construed to mean “including without limitation” unless the context clearly indicates otherwise.
Laws: All applicable statutes, legal requirements, ordinances, rules, regulations, judgments, injunctions, orders, and decrees issued by any Governmental Authority.
Network: A “Proof-of-Stake Network” is a decentralized blockchain ledger where transactions in digital tokens are recorded by a peer-to-peer network of software clients (each a “Node”) running a consensus protocol.
or: Shall be interpreted as inclusive (i.e., “and/or”) unless the context indicates otherwise.
Person: An individual or legal entity, including governmental bodies and subdivisions.
Service Fees: Amounts paid to Validator Nodes for exercising Validation Rights, typically expressed as a percentage of total Block Rewards and Transaction Fees earned.
Token: Any amount (including fractional amounts) of digital tokens on the Network, recorded on the blockchain via transactions.
Transaction Fees: Any amount of digital tokens paid to the Network by transactions. A portion or all of such fees may be distributed to Users exercising Validation Rights and to Validator Nodes on the Network.
User: A holder of Tokens who delegates those Tokens to ELSOUL LABO B.V. to receive Block Rewards and Transaction Fees through Validation Rights on the Network.
Validator Node: A specialized Node authorized to exercise Validation Rights on a Network where only a limited number of Nodes may do so at any given time.
Validation Rights: Rights held by Token owners in a Proof-of-Stake Network, proportional to the Token holdings relative to the total Token supply. These rights can be delegated to Validator Nodes, allowing any Token holder to participate in network maintenance.

All interpretations shall ensure no ambiguity is construed against any drafting party.

Article II: ELSOUL LABO B.V. Services

Section 2.1 ELSOUL LABO B.V. Services

ELSOUL LABO B.V. operates the software and infrastructure necessary to run Validator Nodes on various Networks. When ELSOUL LABO B.V. is selected on a Network to operate a Validator Node, it enables the User to delegate Tokens so that ELSOUL LABO B.V. can exercise the User’s Validation Rights on the User’s behalf, in exchange for Block Rewards and Transaction Fees. The User receives these rewards minus a Service Fee charged by ELSOUL LABO B.V. ELSOUL LABO B.V. is not a financial intermediary and does not provide financial services; it provides only the technological means for staking.

Section 2.2 ELSOUL LABO B.V.’s Responsibility

Subject to these Terms, whenever ELSOUL LABO B.V. is among those selected on a Network to operate a Validator Node, it will use commercially reasonable efforts to operate the Node in a manner designed to facilitate the exercise of the User’s Validation Rights for any Tokens delegated to ELSOUL LABO B.V. at that time (the “Services”). ELSOUL LABO B.V. agrees to perform the Services diligently and in accordance with prevailing industry standards.

Section 2.3 Conditions Precedent to ELSOUL LABO B.V.’s Obligations

ELSOUL LABO B.V.’s obligation to provide the Services is contingent upon:

User Representations: The User’s representations and warranties in Article III remaining accurate and complete as of all times during which the User’s Validation Rights are delegated to ELSOUL LABO B.V.
Validator Status: ELSOUL LABO B.V. being included within the maximum number of Validators permitted on the respective Network.
Legal Compliance: Neither the User’s delegation nor ELSOUL LABO B.V.’s performance of the Services violates any applicable Law or agreement binding on either party.

Because the technologies involved (e.g., distributed networks and consensus protocols) are innovative, experimental, and subject to evolving legal interpretations, any event suggesting that these Services may breach applicable Law or contractual terms allows ELSOUL LABO B.V. to suspend or refuse services. For example:

If one or more tokens is deemed a security under relevant laws and serving as a Validator Node would require licenses or registrations not possessed by ELSOUL LABO B.V.
If the User becomes subject to sanctions (e.g., listed on the OFAC list) or restricted by applicable Laws.
If anti-money laundering or “know-your-customer” rules would make ELSOUL LABO B.V. a money transmitter or payment institution, but compliance is practically unachievable given the decentralized Network.

Additionally, due to the permissionless nature of many Networks:

Anyone holding Tokens can usually delegate them to ELSOUL LABO B.V. anonymously.
ELSOUL LABO B.V. might not be aware of the User’s identity, residency, legal status, or relevant background.

If the User reasonably expects or becomes aware that any condition for delegation has ceased to be satisfied, the User must not delegate or must promptly revoke any existing delegation. ELSOUL LABO B.V. may terminate its Services if it later discovers the conditions were not met.

Section 2.4 No Guarantee of Validator Node Status

ELSOUL LABO B.V. does not guarantee or represent that it will serve as a Validator Node continuously or for any specific period. Its failure to become or remain a Validator Node is not a breach of these Terms and imposes no liability on ELSOUL LABO B.V.

Section 2.5 Fork Handling

Proof-of-Stake Networks may experience “forks” (network splits). ELSOUL LABO B.V. is not responsible for alerting the User about potential or actual forks and has discretion in how it responds to them. If the Network forks, the same number of Tokens delegated on the original chain may be mirrored on the forked chain, but ELSOUL LABO B.V. might not support both. The User could lose Tokens or potential rewards on an unsupported chain. The User alone must track and respond to possible forks (e.g., by revoking delegation if desired).

Section 2.6 Selective Code Deference

Unless otherwise stated, the actions and results on the Network govern the parties’ rights and obligations. For example, any Block Rewards, Transaction Fees, or other distribution that the Network attributes to ELSOUL LABO B.V. by default are deemed the property of ELSOUL LABO B.V. as Service Fees. Conversely, any implied or coded network-based contract that conflicts with these Terms is superseded by these Terms.

Article III: Representations and Warranties of User

At the time of agreeing to these Terms and for as long as the User’s Validation Rights remain delegated to ELSOUL LABO B.V., the User represents and warrants the following:

Section 3.1 Status

If an individual, the User is of legal age and has the capacity to consent under the laws of their jurisdiction.
If an entity, it is duly organized, validly existing, and in good standing under the laws of its formation and has the requisite power and authority for its business activities.

Section 3.2 Power and Authority

The User has the legal capacity, authority, and power to enter into these Terms and to perform its obligations. These Terms constitute valid, binding obligations on the User, enforceable in accordance with their terms.

Section 3.3 No Conflict; Compliance with Law

Entering into and performing under these Terms does not breach any obligations, laws, regulations, or agreements to which the User is subject. The User affirms it will comply fully with all applicable legal requirements.

Section 3.4 Persons Subject to Sanctions

The User is not, and is not owned or controlled by, or acting on behalf of, any Person who appears on any prohibited parties list maintained by governmental or international authorities (e.g., United Nations Security Council, U.S. Treasury’s OFAC lists, EU or member state lists) and is not located in, organized, established, or ordinarily resident in any country against which the U.S. has economic sanctions or embargoes (including Cuba, Iran, North Korea, Sudan, Syria, Russia, Belarus). The User’s tokens are not derived from proceeds of activities that violate or contravene any Law.

Section 3.5 No Claim, Loan, Ownership Interest, or Investment Purpose

Delegation of Validation Rights and Voting Rights to ELSOUL LABO B.V., and the subsequent receipt of Services, does not:

a. Represent a loan or investment in ELSOUL LABO B.V.
b. Give the User any equity or ownership in ELSOUL LABO B.V.
c. Create any fiduciary duty on ELSOUL LABO B.V.’s part toward the User.

The User delegates Tokens for the purpose of receiving staking services, not for investment in ELSOUL LABO B.V. ELSOUL LABO B.V. does not hold custody of the User’s Block Rewards or Transaction Fees. The Network directly disburses any such rewards to the User.

Section 3.6 Non-Reliance

The User is sufficiently knowledgeable and experienced in blockchain and staking technologies, has independently evaluated the Network’s functionality, and has not relied on any representations outside these Terms. The User acknowledges that ELSOUL LABO B.V. makes no additional warranties or representations.

Article IV: Limited Warranty of ELSOUL LABO B.V.

ELSOUL LABO B.V. will use commercially reasonable efforts to provide the Service without introducing errors or corrupting the User’s data. However, except as expressly stated in these Terms, the Service is provided “as is” and “as available,” without warranty of any kind.

ELSOUL LABO B.V. does not represent or warrant that the Service will meet any legal or regulatory obligations that the User may have. ELSOUL LABO B.V. is not liable for any damages arising from the User’s failure to comply with such obligations, nor does ELSOUL LABO B.V. guarantee that:

The Service will operate uninterrupted or error-free at all times,
ELSOUL LABO B.V. will be selected or remain as a Validator Node on any Network,
Technical issues will not prevent the Service from operating in part or in full, and
Any specific warranties, conditions, or assurances (implied, statutory, or otherwise) exist beyond those explicitly stated here.

By engaging in cryptocurrency or blockchain activities, the User acknowledges inherent high risks and potential financial losses. ELSOUL LABO B.V. does not endorse any specific investments or applications. The User bears sole responsibility for any investment decisions. While ELSOUL LABO B.V. may outline plans or roadmaps, these are subject to change. The User receives rewards solely from decentralized protocols, not from ELSOUL LABO B.V.’s validator node directly.

Article V: Limitations of Liability

To the fullest extent permitted by law, ELSOUL LABO B.V. shall not be liable for any damages (direct, indirect, special, incidental, consequential, punitive, or otherwise), losses, costs, fees (including attorneys’ fees), or any similar liabilities arising under any cause of action (including breach of contract, tort, strict liability, etc.) related to these Terms or the Service.

Specifically, ELSOUL LABO B.V. is not liable for losses arising from:

Theft or loss of digital assets or private keys,
User errors in transaction details,
Delayed transaction execution or settlement,
Misorder or misbooking of blockchain transactions,
Security vulnerabilities, bugs, or external attacks on digital assets or technology,
Configuration or installation errors attributable to the User.

In all events, ELSOUL LABO B.V.’s liability, if any, shall be capped at the portion of Service Fees actually received by ELSOUL LABO B.V. that is directly attributable to the User’s delegation of Tokens.

Article VI: Fees

ELSOUL LABO B.V. charges a Service Fee for providing the staking Services. In most cases, the Network automatically deducts and pays this fee to ELSOUL LABO B.V. The specific percentage is publicly recorded (for example, in the metadata of ELSOUL LABO B.V.’s validator identity on the blockchain or in related explorer toolings).

Article VII: Term and Termination

The “Start Date” of the Service is the date the User first delegates Tokens to ELSOUL LABO B.V.

Either party may terminate these Terms:

At any time, for any reason or none:
- By providing written notice to the other party,
- By the User un-delegating their Tokens, or
- By ELSOUL LABO B.V. shutting down its Validator Node or otherwise preventing further delegation.
For good cause, with immediate effect, if the other party materially breaches these Terms.

Termination is subject to any restrictions or requirements set out in relevant Additional Terms or specific blockchain rules.

Upon termination:

The User shall cease using the Service and initiate re-delegation or un-bonding of their Tokens.
The User remains liable for any outstanding fees up to the termination date.
ELSOUL LABO B.V. shall account for any due Block Rewards (minus fees) to the User.
These Terms do not affect ELSOUL LABO B.V.’s right to fees already accrued.

All licenses to access or use the Services automatically end upon termination. Any provisions intended by their nature to remain effective (e.g., payment, liability, warranty disclaimers) shall survive termination.

Article VIII: Miscellaneous

Section 8.1 Governing Law

These Terms are governed by and construed in accordance with the laws of the Netherlands.

Section 8.2 Jurisdiction

All disputes relating to these Terms (including their formation, validity, and termination) fall under the exclusive jurisdiction of the ordinary courts located in Amsterdam, the Netherlands.

Section 8.3 Successors and Assigns

These Terms bind and benefit each party’s permitted successors, assigns, and transferees. The User shall not transfer private keys associated with delegated Tokens without informing the recipient that they will be bound by these Terms while the delegation remains in effect. The User may not assign or transfer its rights or obligations without ELSOUL LABO B.V.’s prior written consent. ELSOUL LABO B.V. may freely transfer or delegate its obligations to the extent permitted by law.

Section 8.4 Entire Terms

These Terms represent the entire agreement between the parties concerning the subject matter and supersede all prior discussions or agreements, oral or written, relating to such subject matter.

Section 8.5 Severability

If any provision of these Terms is found invalid or unenforceable by a court or authority, the remaining provisions will remain in effect. The parties will seek to replace the invalid provision with a valid one that most closely reflects the original economic intent.

Section 8.6 Notices

Any notice under these Terms must be in writing (including e-mail) and is deemed received upon delivery to the designated contact details.

Section 8.7 Force Majeure

ELSOUL LABO B.V. is not liable for delays or failures caused by events beyond its control (e.g., legal restrictions, governmental acts, acts of God, war, pandemics, internet outages, network attacks, or disruptions). ELSOUL LABO B.V. will make commercially reasonable efforts to resume performance promptly once conditions permit.

Section 8.8 Amendments

ELSOUL LABO B.V. may update these Terms in justified circumstances. Any such modification will be communicated to the User in a reasonable manner. Unless the User objects in writing within one month—or unless the User continues to use the Service—these amendments are deemed accepted. If the User objects, either party may terminate the relationship with immediate effect.

Section 8.9 No Waiver

A party’s delay or failure to exercise any right or remedy does not constitute a waiver. No waiver is valid unless expressly stated in writing, and such waiver applies only to the specific instance cited.

Article IX: Security Policy and Operational Procedures

Section 9.1 Security Policy

ELSOUL LABO B.V. is deeply committed to maintaining the highest standards of security in its validator operations. We employ a multi-layered defense strategy that includes, but is not limited to:

Infrastructure Hardening: We regularly apply security patches and updates, configure firewalls and access controls, and follow strict server hardening guidelines to minimize potential attack vectors.
Access Management: We implement the principle of least privilege for all team members and utilize multi-factor authentication to further protect administrative interfaces and critical systems.
Monitoring and Alerting: We continuously monitor validator activity, system logs, and network traffic for unusual patterns or suspected intrusions. Automated alerts and notifications allow us to respond swiftly to potential threats or anomalies.
Vulnerability Assessments: Routine audits, penetration tests, and vulnerability scans are performed to proactively identify and address security gaps before they can be exploited.
Incident Response and Recovery: We maintain a detailed incident response plan that outlines clear protocols for addressing and mitigating security events in a timely and effective manner.

We do not employ unproven modifications that could adversely affect the consensus or stability of any Proof-of-Stake Network.

Section 9.2 Operational Procedures

ELSOUL LABO B.V. utilizes an open-source staking management framework known as SLV (https://slv.dev/), enabling us to maintain continuous (“no-downtime”) operations. Through careful design and rigorous testing, we ensure that the validator remains online and in sync with the network at all times, thereby helping to maximize Block Rewards for our Users.

Optimized Configurations: We deploy our validator nodes with an optimal machine setup and configuration, balancing performance, resilience, and cost-efficiency to secure the highest possible rewards.
Failover Mechanism: To safeguard against unexpected downtime, we run a secondary or backup validator. In the event of a primary validator failure, this system seamlessly takes over, minimizing disruption to our staking services and reducing overall downtime to the absolute minimum.
No-Downtime Updates: While validator node updates typically require some downtime that can affect network performance and potentially reduce block rewards, ELSOUL LABO B.V. employs SLV "No-downtime Update" to conduct updates without interrupting service. This approach ensures near-zero downtime, thereby maximizing rewards for our Users.
Continuous Monitoring: Our operational team continuously monitors node performance and network conditions, making adjustments as needed to maintain optimal output. Proactive scaling, load balancing, and infrastructure upgrades are carried out as required.

By combining advanced security measures with reliable operational practices, ELSOUL LABO B.V. endeavors to provide a secure and high-availability staking environment for all Users.

ELSOUL LABO B.V.
Date of Last Update: 2025/02/16