3.1 Manual Purpose

This Conflict-of-Interest Manual (the 'Manual') Establishes the internal policies, procedures, and requirements of Mc. Coin Virtual Assets L.L.C ('the Company') with respect to conflicts of interest. The Company is committed to treating its clients fairly and requires its staff to conduct themselves with the highest standards of integrity. Failure to identify and appropriately manage conflicts of interest could result in inappropriate or adverse consequences for the clients, Investors, Company, and staff.

Owing to the nature of the Company's business activities, circumstances may arise in which competing interests create actual or potential conflicts of interest. A conflict of interest is deemed to exist when the pursuit of one party's interests could reasonably be expected to compromise, impair, or place at a disadvantage the interests of another.

Manual Application

1. This Manual provides a set of guidelines for the governance around conflicts of interest and control of the Company. This Manual lays down the flow of authority, responsibility, and accountability of the Board of Directors (the 'Board') and Senior Management. In particular, the Company shall use all reasonable efforts to avoid conflicts of interest between any of the following:
   1. Their Group.
   2. The Company.
   3. The Board of the Company.
   4. The staff of the Company.
   5. The clients of the Company.
   6. The Investors of the Company.
2. This Manual ensures to manage various conflicts of interest, including perceived conflict and potential conflict.
3. This Manual outlines the Company's framework for identifying and managing conflicts of interest and sets out the principles in relation to the identification, documentation, management, and escalation of conflicts of interest, including examples of where such conflicts of interest may arise within the Company.
4. This Manual ensures to minimize the risk of unfair treatment of clients and third parties (any natural or judicial person other than staff, clients and other persons associated with the Company), to prevent inappropriate use of confidential information or the Company's position to gain an advantage.
5. This Manual aims to protect the Company from any serious sanctions, reputational damage litigation, loss of licenses and financial penalties.

3.2 Manual Understanding

This Manual is applicable to the Company's Board and all its staff. All staff must fulfill their roles and responsibilities with respect to this Manual.

3.3 Manual Review

1. This Manual shall be reviewed at least annually, or as directed by the Board, to ensure it remains current and compliant with any material changes in the Company's operations or applicable regulatory requirements. All amendments must be properly documented and approved prior to implementation. Staff will be duly notified of any material updates.
2. Any breaches to this Manual shall be escalated to the Compliance function.

3.4 Manual Owner

1. This Manual shall be owned by the Compliance Officer.
2. This Manual shall be approved and issued by the Board.
3. Any exceptions to this Manual shall be approved by the Board before their application.

3.5 Disclaimer

This Manual was prepared for the purpose of the VARA license application. The content of this Manual may be updated to address the business and regulatory requirements as and when they become available, during the implementation phase of the Company, prior to the launch of the Company.

4.1 General Principles

In the context of this Manual, a conflict of interest is a situation in which the Group, Company, Board, staff, Investor or Client, has a business or personal interest that competes or could potentially compete with the interests of anyone or more Group, Company, Board, staff, Investor or Client. There are many varieties of conflicts of interest that apply to a wide range of behaviors and circumstances. Conflicts of interest relevant to the Company can arise between:

1. Their Group.
2. The Company.
3. The Board of the Company.
4. The staff of the Company.
5. The clients of the Company.
6. The Investors of the Company.

For the purposes of this Manual, conflicts of interest include actual conflicts (i.e., those that have already arisen), potential conflicts (i.e., those that may arise under specific circumstances), and perceived conflicts (i.e., situations that may reasonably be seen to present a conflict, even if none exists in fact). Some conflicts are ongoing in nature and require continuous management, while others may arise in connection with a specific event (e.g., a payment transaction) and can typically be addressed through one-time mitigation measures.

The Company shall always be committed to ensuring and managing the conflict of interest of the Company, its staff and its clients.

Where the Company cannot reasonably avoid conflicts of interest, it must disclose such conflicts of interests to its affected clients, who must be treated fairly.

Where the company, a member of the Board or any staff have an interest or a relationship that may reasonably impair its objectivity in a transaction or give rise to an actual or potential conflict of interest in relation to the transaction, the Company must disclose the nature of the conflict to its affected client. Furthermore, to the extent that the Company can, it must sufficiently protect, manage and minimize such conflict by adopting appropriate measures to ensure fair treatment to its affected client (i.e. Chinese Walls).

The Company must maintain a special register for conflicts of interest. This register must record, in detail, the conflicts and management and remedial measures taken.

Where the Company is representing itself as being independent when conducting a Virtual Asset activity, it will not receive any third party fees, commissions or benefits. Furthermore, the Company will not have any close links or other legal or economic relationships with third parties in relation to the provision of services related to the Virtual Asset activity.

The Company shall observe all local, regulatory, statutory and fiduciary requirements when identifying and managing conflicts of interest.

4.2 Staff Specific Principles

1. All staff shall ensure that their personal interests do not conflict with the duties of which they owe to the Company, or which the Company owes to their clients and Vendors.
2. All staff shall ensure that they discharge their role with honesty and integrity, always putting the Company's and its clients interests ahead of their own and avoiding abuse of position for personal gain or benefit.
3. Staff are required to act with honesty and integrity, avoid actual or potential conflicts of interest in a personal capacity and as part of their Company mandate.
4. All staff are expected to recognize when they have, potentially have, or could be perceived as having a conflict of interest, and to make the required disclosures to their business line managers and Compliance function.
5. Staff shall not use their association with the Company to advance their personal interests, act in any way that could harm the Company's reputation or use their positions to provide preferential treatment to anyone seeking to do business or employment with the Company.
6. Staff shall not misuse information obtained in the course of working and shall apply the Company's 'Need-to-know basis' principle and respect duties of confidentiality at all times.

5.1 Identification

Conflicts of interest may arise within the Company in various circumstances. Staff are expected to identify potential conflicts to ensure they are managed appropriately and in accordance with this Manual. Common areas where conflicts of interest may arise include, but are not limited to:

• Nepotism: Favoring relatives or personal friends due to their relationship rather than their abilities.
• Gifts and Entertainment: Exchanging something with the expectation of receiving something in return. See the Anti-Bribery and Corruption Policy.
• Self-dealing: When a director, officer, or controlling shareholder acts unfairly within the company for personal gain, resulting in disproportionate benefit.
• Outside Employment: Activities that conflict with a staff member's official duties or result in failure to meet minimum productivity or quality standards.
• Bribery/Kickbacks: Offering something, usually money, to gain an illicit advantage.
• Current or Prior Relationships: Strategic partners and high net worth individuals (HNWIs) with positions at, or connections to, public issuers.
• Services: Having an interest in the outcome of a service provided to a client or a transaction carried out on behalf of a client, which differs from the client's interest.

See Section 6 for further examples of conflict of interest scenarios within the Company. All stakeholders, including Board Members, Senior Management, and staff, have a personal responsibility to disclose any conflicts of interest and to abstain from, or take relevant measures regarding, transactions that may involve a conflict of interest.

5.2 Escalation

If a conflict of interest is identified, it must be managed promptly and fairly through the following escalation process:

1. Report the conflict to the staff member's immediate supervisor, detailing the existence and nature of the conflict.
2. Supervisors or Senior Management are responsible for assessing actual or potential conflicts and, after consulting relevant control functions, determining the best course of action, including escalation to higher authority if needed.
3. Senior Management must notify the Compliance Officer of the conflict, including case details.
4. The staff member must be given an opportunity to provide justification.
5. The Compliance Officer will assess and approve conflict cases and consult the CEO or other Senior Management, as appropriate, when making a decision.
6. If the Compliance Officer is involved in the conflict, the case must be reported to the CEO.
7. The Board is the approving authority for cases involving the CEO.
8. Once resolved, the appropriate action must be taken and all details documented for future reference, including updating the conflicts of interest register.

5.3 Conflicts of Interest Register

1. The Compliance function must maintain a record of documentation and actions taken.
2. The Compliance Officer must record details of conflicts of interest and measures taken to prevent or manage them in the register.

5.4 Management and Control

The Company must take all reasonable steps to ensure that conflicts of interest do not adversely affect the interests of clients, the Company, investors, shareholders, or other stakeholders. This is achieved through identification, prevention, and effective management of such conflicts. The Company may use various measures—individually or in combination—including, but not limited to, the following:

5.4.1 Conflict Checks

1. Conflict checks must be performed on potential contracts, agreements, or partners to identify any conflicts of interest before signing legally binding documents to provide services to a client who may have conflicting interests with the Company or its existing clients. Such conflicts include, but are not limited to:
   1. Vendor selection.
   2. Outsourcing.
2. Conflict checks must also be performed on staff members' personal activities and interests to identify any potential or actual conflict with the Group, Company, Board, other staff, clients, or investors before joining the Company. This includes checks on:
   1. Direct family members (spouse, children, spouses of children, parents).
   2. Political affiliations.
   3. Gifts and hospitality to be offered or intended to be received.

5.4.2 Disclosures

1. All staff must disclose any existing or potential conflicts of interest, including:
   1. Existing or potential relatives working in the Company, even if separated or in a different department.
   2. Directorship or significant shareholding in other companies resulting in a conflict of interest.
   3. Any interest in a partnership, will, or trust.
   4. Directorship in any corporate arrangement.
   5. Any role or position of responsibility that may conflict with the interests of the Company.
2. Disclosure must occur as soon as the staff member identifies a potential conflict.
3. Newly hired staff must disclose all conflicts to HR during the hiring process so they can be discussed and approved by relevant departments.

5.4.3 Personal Gifts and Entertainment

A conflict of interest may arise if a staff member receives or offers a gift or entertainment that constitutes an inappropriate incentive for the staff, the Company, a third-party representative, client, or vendor to act in a certain way. The Company does not permit the offering or acceptance of gifts or entertainment by staff unless it is reasonable, proportionate, and for a legitimate business purpose. See the Anti-Bribery and Corruption Policy.

5.4.4 Outside Business Interest

Staff interests outside their role at the Company may conflict with the interests of the Company or its clients and must be managed to maintain the integrity of the Company and its staff. Additionally, outside business interests may expose staff to confidential information of a client or potential client, resulting in a conflict of interest. See the Anti-Bribery and Corruption Policy.

5.4.5 Segregation of Duties

The Company must maintain clear structural segregation between business and infrastructure functions to ensure independent operation of business activities and risk management. The Company must also implement and uphold an internal control environment based on the 'Three Lines Model' framework, which defines and reinforces risk management, control, and reporting responsibilities across the organization. Independence of key control functions, including Compliance, Risk, and Internal Audit, is required for effective oversight and accountability.

5.4.6 Vendors and Third-Party Representatives

1. The Company must conduct due diligence on vendors and third-party representatives as part of onboarding and have contractual arrangements to protect the interests of the Company and its clients.
2. Conflicts of interest may arise with vendors and third-party representatives, for example, if a staff member involved in procurement or hiring has a close relationship with a particular vendor or representative.
3. Staff are expected to identify, escalate, and manage potential conflicts of interest accordingly. Staff must report and escalate all matters that could reasonably impact their independence and objectivity, interfere with their duties to the Company or its clients, or give rise to a perception of a conflict of interest.
4. The Company must manage actual or potential vendor relationships, which may also be client relationships, independently and on an arm's length basis. Rules of engagement between the Company, vendors, and clients must be set out to manage actual or potential conflicts of interest.

5.4.7 Escalation

The Company must operate escalation and resolution procedures for conflicts of interest (client-related or otherwise). Staff must follow the internal escalation process as described in Section 4.

5.4.8 Whistleblowing

The Company must provide appropriate channels for reporting or whistleblowing conflicts of interest within the Company when a staff member considers this the appropriate channel to draw attention to the matter. The Whistleblowing Policy sets forth the principles for staff to report concerns or suspicions regarding possible violations of laws, rules, regulations, or Company policies, standards, or procedures, including the Company's values and beliefs.

1. Any breach or violation whether advertent or inadvertent, of the Conflict-of-Interest Manual shall be reported without delay to Compliance function.
2. Breaches of the Manual could lead to the following consequences:
   1. Loss of clients.
   2. Client litigation.
   3. Sanctions from the regulator.
   4. Disciplinary action or potential dismissal at the discretion of Human Resources.
3. Breaches reported must remain confidential and contained to avoid increasing the severity of the breach.

1. All staff shall undergo mandatory training relevant to their role, in respect to this Manual.
2. Attendance of training shall be monitored for performance evaluation purposes.
3. Non-compliance shall lead to violation of this Manual and shall be escalated to business line manager and Compliance function for consequent disciplinary action, if deemed necessary by Compliance function.

Examples of conflicts of interest scenarios that may occur in the Company: