Kingdom of Kush

RISK MANAGEMENT

RISK MANAGEMENT PLAN during both the SECURITY TOKEN and
NATIONAL DIGIAL CURRENCY PHASES

The KUSHITECASH risk management plan is a fluid document and at its present state, realizes a general low risk profile with no high-risk ratings. We feel that the token development and token launch are relatively low-risk however with any investment or financial instrument, some risks are inherent and possible. Security and stability (liquidity, issuance, value) mitigate many risks currently found in the digital market; however, some risks are driven via ecosystem integration, operational speed, governing bodies etc., however development milestones have already been achieved and carry low risk profile moving into the future.

The platform has identified the top risks, probability or likelihood of occurrence, the financial impact and steps to resolve. In an effort that drives and maintains security, stability and confidence, the Kingdom of Kush will employ the services of UMBRA GLOBAL, utilizing its proprietary technology and expertise to manage, mitigate and resolve potential risks. Below is a simplified approach to summarize and identify top risks to the KUSHITECASH Token and the KINGDOM-CURRENCY Coin. This is a high-level view that outlines potential events that could occur based on its severity and probability along with a categorized financial impact approach. 

Kingdom of Kush

RISK FACTOR 1

Slow KUSHITECASH Token adoption rate Post STO
TYPE - Market Risk

LIKELIHOOD – Improbable
CONSEQUENCES - Low

MITIGATION TACTICS – The Kingdom of Kush will be built on smart & blockchain technology. As the KUSHITECASH Token will be exchanged for
KINGDOM-CURRENCY, which will utilize its own exchange – the KUSHXCHANGE. This unique digital solution solves ongoing security, trust, and market liquidity issues.

MITIGATION COSTS - Medium $ 

RISK FACTOR 2 

KUSHITECASH Token Credibility & Stability
(Product not needed or low adoption rate)

TYPE - Market Risk

LIKELIHOOD - Possible CONSEQUENCES - Medium

TACTICS – Control of digital national currency issuance and security are critical issues in the launch of a digital national currency. Typical coins are created via hyper-energy focused mining and lack critical security measures to prevent hacks, eavesdropping, and masquerading.

Since the KINGDOM-CURRENCY will be minted on the KUSHCHAIN, the KINGDOM-CURRENCY will be the first virtually hack-proof digital currency, and backed by the Kingdom of Kush’s natural resources, real estate & taxation power to drive the value for KINGDOM-CURRENCY. As a result of being the first “natural-resourced backed” digital currency, KUSHCHAIN eliminates mining and is the fastest and most secure blockchain, producing real-time consensus and is end-ended encrypted and GDPR compliant, enabling the use of the coin for day-to-day transactions, investment, etc.

Furthermore, because of the elimination of mining in the new KUSHCHAIN, KINGDOM-CURRENCY will drive a competitive advantage based on its technology and excellent security profile. Since KINGDOM-CURRENCY is built with the KUSH247 security profile, KINGDOM-CURRENCY will be immune to many of the cyber threats that plague the digital market today. Steps have been developed to prevent hacks from new issuance of currency, driving confidence and stability. Further steps have been planned to maintain a healthy reserve balance as the Kingdom of Kush develops and its currency utilization is widely adopted and implemented.

MITIGATION COSTS - Medium $ 

RISK FACTOR 3 

Pressure by other CBDC from other Central Banks, Nations, etc.

TYPE - Competitive Risks LIKELIHOOD - Possible CONSEQUENCES – Low

MITIGATION TACTICS – While there is a continuing effort worldwide to adopt blockchain technology into a faster, efficient way to transfer value between individuals, parties, countries, etc., the rise of a Central Bank Digital Currency (“CBDC”) or the adoption of an existing digital national currency as a nation’s reserve currency is inevitable. The KUSH DIGITAL portfolio of products will maintain a superior advantage over its competition as the solution portfolio implements ultra-strong security policies and procedures.

In addition, we intend to implement strong security policies and procedures that will include but are not limited to physical and digital security, strict software development controls, background verification for employees, security awareness, and counterespionage training and more.

MITIGATION COSTS – Medium $ 

Kingdom of Kush

RISK FACTOR 4

Security compromise
TYPE - Technology operational Risk LIKELIHOOD - Improbable

CONSEQUENCES - Medium

MITIGATION TACTICS - Secure coding procedures, internal QA, security awareness training programs, third-party security code verification, third-party penetration testing, white hat hacking, and public bug bounty programs will all be part of our intensive security program. To be prevented and resolution to cyberattacks service provided by UMBRA GLOBAL technology.

MITIGATION COSTS - High $$CONTENT$nbsp;

RISK FACTOR 5 

Failure to Execute – Delay in offerings

TYPE - Technology & Operational Risk LIKELIHOOD - Improbable  

CONSEQUENCES - High

MITIGATION TACTICS – As an experienced team, we have created many previous successful startups, in which we raised more than $3 Billion from some of the world’s top venture capitalists. The team is responsible for operations, finance, security, technology, product design, and product development. KUSHITECASH Tokens are initially built on Ethereum (ERC20), and faces current market risks, however post UN GA meeting in Q3 of 2022, KUSHITECASH Tokens will be offered an exchange for KINGDOM-CURRENCY built with the KUSH247 standard, rendering it the most secure digital currency in the world. 

MITIGATION COSTS - High $$CONTENT$nbsp;

RISK FACTOR 6 

Cash Flows

TYPE - Financial Risk

LIKELIHOOD - Improbable

CONSEQUENCES - Medium

MITIGATION TACTICS – Kush Digital will host a three Phase private presale to raise capital for the initial development of the Kingdom of Kush and the ongoing development of the KUSHCHAIN suite of products. The KUSHITECASH Token launch is planned to occur in a series of phases, along with grants for citizenship (with a partial amount of KUSHITECASH Tokens returned to the new citizen’s wallet) in order to drive market economy and incentivize applicants to the Kingdom of Kush. It is intended that an offer to convert into KINGDOM-CURRENCY will be made by the Kingdom of Kush Central Bank, at which time holders of KUSHITECASH Tokens will be able to convert into KINGDOM-CURRENCY backed by the natural resources and taxing power of a nation-state and not subject to the ability/function of mining of a crypto-currency.

MITIGATION COSTS - Low $CONTENT$nbsp;

RISK FACTOR 7

Slow adoption of Kush Citizenship / slow economic expansion

TYPE – People/Financial Risk  

LIKELIHOOD - Improbable CONSEQUENCES – Low

MITIGATION TACTICS – Because KUSHITECASH Tokens will be offered conversion to KINGDOM-CURRENCY, and when converted will be backed by its natural resources and furthermore, will be used in the construction of infrastructure, buildings, etc., the economy of the Kingdom of Kush will need to be built and scaled quickly in order to drive economic development and expansion. As the current nomadic population is under-developed, there should be increasing demand for skilled and valued workers.

MITIGATION COSTS - High $$

RISK FACTOR 8 

U.S. SEC Securities Laws Violation of Compliance

TYPE - Legal and Regulatory Risk LIKELIHOOD - Improbable

CONSEQUENCES - Medium

MITIGATION TACTICS – KUSHITECASH Tokens comply fully with SEC rules and regulations under Regulations D and S for Pre-Sale sales. A finite amount of KUSHITECASH Tokens have been minted, and there is no ability for others to mine tokens, which along with the control of issuance by the Kingdom of Kush, mitigates liquidity and issuance concerns. The STO public sale is held within months of the planned private pre-sales and subject to SEC rules and regulations if sold to US investors.

MITIGATION COSTS - Low $

RISK FACTOR 9 

Lawsuits or Losses of Personnel or Property

TYPE - Legal and Regulatory Risk LIKELIHOOD - improbable 

CONSEQUENCES - Low 

MITIGATION TACTICS – While lawsuits and losses may be uncommon risks, there are many insurable protections to mitigate them. Having experience in the startup world, we know it is necessary to have various insurance policies, including but not limited to: 

• Property & Casualty Insurance to mitigate losses from fire, theft, and natural 
  disasters
• Key Executive Insurance to mitigate losses from death or incapacitation of
  founders or management
• Liability Insurance to mitigate lawsuits resulting from product defects or injuries
  of office visitors
• Errors & Omissions Insurance to mitigate lawsuits from disgruntled customers
• Directors & Officers Insurance to mitigate lawsuits in cases of negligence,
  harassment, or discrimination

MITIGATION COSTS - Medium $ 

RISK FACTOR 10 

International regulations in the digital marketplace

TYPE - Systemic Risk

LIKELIHOOD - Possible

CONSEQUENCES - Low

MITIGATION TACTICS – The KINGDOM-CURRENCY will not rely solely on existing digital exchanges post-UN General Assembly Approval. The technology standard developed for the KUSH DIGITAL Portfolio is replicated as a future coin and token products are built on this standard will be listed and traded on the KUSHXCHANGE. It is positioned to replace the antiquated, legacy banking payment systems that are not secure, but are very expensive, such as SWIFT and ACH. KUSHITECASH Tokens will utilize the ERC20 standard on the security token exchange or ATS platform until exchange to the KINGDOM-CURRENCY is provided at the conversion event to KUSHITECASH Token holders.

MITIGATION COSTS - Low $

Kingdom of Kush
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