Risk Disclosures

Using Sippy involves real financial activity on a public blockchain. We believe you should understand the risks before you start. This page is written to be direct, not to scare you away.

Irreversible transactions

Blockchain transactions cannot be undone. Once a transfer is confirmed on Arbitrum, no one -- not Sippy, not Coinbase, not the network -- can reverse it. If you send funds to the wrong address or wrong phone number, those funds may be permanently lost. Always double-check recipient details before confirming.

USDC peg risk

USDC is designed to maintain a 1:1 value with the US dollar. Circle, the issuer, backs each USDC with US Treasury bonds and cash reserves and publishes monthly attestations. However, the peg depends on Circle's continued solvency and operational integrity. In March 2023, USDC temporarily traded below $1 during a US banking crisis before recovering. While this risk is low, it is real. USDC is not the same as holding physical dollars in a bank.

Smart contract risk

Your wallet and transactions interact with smart contracts -- code that runs on the blockchain. Smart contracts can contain bugs or vulnerabilities. Sippy mitigates this by using audited, battle-tested contracts from Coinbase and established protocols on Arbitrum. But no software is guaranteed to be free of defects. The risk is low, but not zero.

No deposit insurance

Sippy is not a bank. Your funds are not insured by the FDIC, FOGAFIN, or any government deposit insurance program. If something goes wrong -- whether due to a smart contract exploit, a USDC depeg event, or any other cause -- there is no government safety net to make you whole.

Key management

Sippy wallets are non-custodial. While Coinbase's embedded wallet infrastructure manages your keys during normal use, if you choose to export your private key, you assume full responsibility for its security. A lost or stolen private key means permanent loss of access to your funds. There is no "forgot password" recovery for a private key.

Regulatory risk

Cryptocurrency regulation in Latin America and globally is evolving. Laws around digital assets could change in ways that affect Sippy's ability to operate in certain countries, restrict certain types of transactions, or impose new requirements on users. Sippy is incorporated in El Salvador and operates in compliance with applicable laws, but the regulatory landscape is not static.

Network risk

Arbitrum is a reliable network, but no technology is immune to outages, congestion, or unforeseen issues. In rare cases, network problems could delay transactions or temporarily prevent access to funds. Arbitrum's track record is strong, and it has handled significant transaction volume, but past performance does not guarantee future availability.

Sippy's operational risk

Sippy is an early-stage company. While the wallet infrastructure (Coinbase CDP) and the network (Arbitrum) are operated by large, well-funded organizations, Sippy itself is a small team. Service interruptions, bugs, or changes to the product are possible. Because the wallet is non-custodial, your funds remain accessible on-chain even if Sippy's service is temporarily unavailable -- you would just need another way to interact with the Arbitrum network.

Your responsibility

By using Sippy, you accept these risks. We build with safety as a priority -- non-custodial wallets, audited infrastructure, transparent on-chain records -- but no system eliminates all risk. Start with amounts you are comfortable with and make sure you understand how the product works before relying on it for significant sums.