Sanctions & Compliance Policy

1. Policy Statement

Coinbax, Inc. ("Company," "we," "us," or "our") is committed to preventing money laundering, terrorist financing, sanctions evasion, and other financial crimes. This Sanctions & Compliance Policy describes the measures we apply to Coinbax Send (the "Service").

Coinbax Send is a non-custodial software interface. We voluntarily implement the compliance measures described here to help ensure the Service is not used for illicit purposes.

2. Non-Custodial Architecture

Important distinction: Coinbax Send is a non-custodial software interface. This means:

• We do not take possession, custody, or control of user funds at any time
• Users interact directly with escrow smart contracts on the Base network through their own self-custodial wallets
• We do not exchange or convert digital assets, and we do not accept, exchange, convert, or transmit fiat currency
• All transfers are wallet-to-wallet and executed on-chain by the user; escrowed funds are held by the smart contract, not by us

3. Sanctions Compliance

On every transfer, we screen the sender and every recipient wallet address in real time, before any funds move, through Chainalysis against sanctions lists including:

• OFAC: U.S. Office of Foreign Assets Control Specially Designated Nationals (SDN) List
• UN: United Nations Security Council Consolidated List
• EU: European Union Consolidated Financial Sanctions List

Transactions involving sanctioned addresses are automatically blocked before the sender is asked to sign. Users attempting to transact with sanctioned addresses will be unable to use the Service.

4. Address Risk Screening

Beyond sanctions lists, we use blockchain analytics to screen the addresses on a transfer for association with known illicit activity, including:

• Known high-risk addresses
• Addresses associated with darknet markets, ransomware, or fraud
• Connections to mixing services used for illicit purposes

Flagged addresses may result in transaction blocking or suspension of access to the Service.

5. Transfer Controls

Every transfer is subject to controls enforced before and during settlement:

• Amount limits checked on every transfer before your wallet signs
• Blockchain analytics and address reputation screening
• An escrow hold window during which the sender may cancel; on cancellation the principal is returned to the sender and the service fee is retained
• Where enabled, additional verification steps — such as SMS verification before release

6. Prohibited Activities

The following activities are strictly prohibited and will result in immediate service termination:

• Money laundering or attempts to disguise the origins of illicit funds
• Terrorist financing or support for designated terrorist organizations
• Transactions with sanctioned individuals, entities, or jurisdictions
• Fraud, theft, or other criminal activities
• Tax evasion or circumvention of legal obligations
• Ransomware payments or extortion
• Human trafficking or exploitation
• Illegal gambling operations
• Drug trafficking or illegal arms dealing

7. Reporting and Cooperation

We cooperate fully with law enforcement and regulatory authorities:

• Law Enforcement Cooperation: We respond to valid legal requests, subpoenas, and court orders.
• Sanctions Matters: Apparent sanctions violations are reported to OFAC as required by law.
• Voluntary Reporting: Where appropriate, we may voluntarily report suspected illicit activity to relevant authorities.

8. Record Keeping

We maintain comprehensive records of:

• All transactions processed through the Service
• Sanctions screening results
• Investigations of flagged activity
• Compliance decisions and their rationale

Records are retained for as long as needed for compliance, dispute resolution, and legal purposes.

9. Compliance Oversight

The measures in this policy are owned by a designated internal team and are reviewed and updated as regulations, risks, and the Service evolve.

10. User Obligations

By using the Service, you represent and warrant that:

• You are not subject to economic sanctions or on any prohibited party list
• You will not use the Service for any illegal purpose
• The funds you transfer are not derived from illegal activities
• You will comply with all applicable laws and regulations
• You will not attempt to circumvent our compliance controls

11. Policy Updates

This policy is reviewed and updated regularly to reflect changes in regulations, industry best practices, and our risk assessment. Material changes will be communicated through our Service.

12. Contact Information

For questions about this policy or to report suspicious activity, please contact: Coinbax, Inc. Compliance Team — compliance@coinbax.com.