Hedging Policy OKX Australia Financial Pty Ltd

HEDGING POLICY

OKX AUSTRALIA FINANCIAL PTY LTD

TABLE OF CONTENTS

1. PURPOSE AND SCOPE 3

2. HEDGING APPROACH 3

3. SELECTION OF HEDGING COUNTERPARTIES 3

4. CURRENT HEDGING COUNTERPARTIES 4

5. REVIEW AND APPROVAL 4

6. RECORD RETENTION 4

7. DOCUMENT ADMINISTRATION 4

1. PURPOSE AND SCOPE

This Hedging Policy (“Policy”) is established to outline the approach of OKX Australia Financial Pty Ltd (“OKX AUF”) in managing its exposure to market risk from client positions, which includes:

• The hedging approach

• The factors taken into account in determining hedging counterparties

• The names of those hedging counterparties

This Policy is developed to directly align with “Benchmark 3: Counterparty Risk - Hedging” contained within ASIC Regulatory Guide 227 “Over-the-counter contracts for difference: Improving disclosure for retail investors”.  

2. HEDGING APPROACH

OKX AUF adopts the matched principal approach for all client trades. When a client places an order to enter a derivative position, OKX AUF enters into two simultaneous trades:

(i) OKX AUF trades with the client as counterparty on an Over-The-Counter (“OTC”) basis, and; 

(ii) OKX AUF enters into an offsetting trade with the hedge counterparty

This means that all client positions are fully hedged on a back-to-back basis, so that OKX AUF's net market exposure is intended to be zero at all times.

3. SELECTION OF HEDGING COUNTERPARTIES

In selecting hedging counterparties, OKX AUF aims to ensure optimal outcomes for its clients (including but not limited to pricing and operational efficiency), along with ensuring that the counterparties meet relevant criteria, which include:

• Adequate financial and compliance resources

• Appropriate regulatory licensing within its jurisdiction

Any new counterparty is subject to an appropriate due diligence process, with potential alternative providers also identified as part of this process.

4. CURRENT HEDGING COUNTERPARTIES

OKX AUF’s primary hedging counterparty is OKX Bahamas Fintech Company Limited, authorised as a Digital Asset Business (“DAB”) by the Securities Commission of the Bahamas (“SCB”), operating under the Digital Assets and Registered Exchanges (“DARE”) Act.

OKX Bahamas Fintech Company Limited is a related entity within the OKX Group.

5. REVIEW AND APPROVAL 

This Policy remains in force and will be reviewed annually, or upon any relevant updates made by the Company in relation to hedging.

6. RECORD RETENTION 

A copy of this document will be retained for a minimum of five (5) years, or longer, in accordance with applicable laws, rules, and regulations and the Company's Global Record Retention Policy. 

7. DOCUMENT ADMINISTRATION