MiCAR White Paper

Grove (BVI) Ltd. is the entity responsible for issuing the Token and for seeking admission of the Token to trading. Grove (BVI) Ltd. is a subsidiary of Grove Foundation.

Grove Foundation’s purpose is to develop, support, and incentivise the growth of the Grove protocol and the broader Grove ecosystem.

Grove (BVI) Ltd. was established in November 2025 and its activity has been limited to the issuance and distribution of the Token. It is supported by its parent, Grove Foundation, has no debt and no material liabilities, and is financially stable as of the date of this white paper.

Grove is an onchain credit infrastructure protocol that deploys stablecoin liquidity into diversified credit strategies.

Grove operates as a Prime Agent (subDAO) within the Sky ecosystem (formerly MakerDAO).

The Token is the native token of the Grove ecosystem, designed to facilitate coordination, participation and access within the Grove ecosystem.

The Grove protocol is supported by development resources contributed by its development team, legal and compliance support from external counsel, and financial resources provided through grants from Sky.

N/A. This white paper concerns an admission to trading of a token already in existence; no funds or crypto-assets are being collected.

The purpose of the admission to trading is to increase the liquidity and exchangeability of the Token, and facilitate broader participation in the Grove ecosystem, including its governance. This is an admission to trading and not a fundraising event or offer to the public; no funds are being collected.

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Purchases of GROVE on a trading platform may be made using the crypto-assets or fiat currencies supported by the relevant platform, subject to that platform’s terms and conditions.

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GROVE acquired through trading is transferred by the means designated by the relevant trading platform to the holder’s compatible wallet or account.

To hold GROVE, a holder requires either an account on a trading platform where GROVE is listed (subject to that platform’s terms) or an ERC-20-compatible Ethereum wallet, together with internet access and a compatible device.

Potential purchasers can access the platforms where the Token is listed via the instructions given on the respective platform websites. Potential purchasers should refer to the relevant information provided by each platform regarding access and the ability to transact in the Token.

The costs of accessing and transacting on the trading platforms on which the Token may be listed vary by platform and may include transaction fees, withdrawal fees, and other charges determined by the respective platforms. Such costs are not controlled by Grove or its affiliated entities. Potential purchasers should refer to the information provided by the relevant trading platform.

To the best of the knowledge of Grove (BVI) Ltd., no conflicts of interest have been identified in relation to the admission to trading.

The applicable law governing the admission to trading of the Token on an EU crypto-asset trading platform will vary depending on the relevant trading platform. Purchasers should refer to the terms and conditions of the relevant trading platform.

The competent court for disputes relating to the admission to trading of the Token on an EU crypto-asset trading platform will vary depending on the relevant trading platform and the nature and location of the investor. Purchasers should refer to the terms and conditions of the relevant trading platform.

Crypto-asset other than an asset-referenced token or e-money token. GROVE is a fungible ERC-20 token.

GROVE is designed to facilitate coordination, participation and access within the Grove ecosystem.

Initially, GROVE may be used to participate in governance processes, accessed by staking GROVE. At or shortly following the Token’s admission to trading, holders who stake their Tokens may participate in community votes that act as a check on team-led proposals, including by voting to reject such proposals.

GROVE does not confer any right to protocol revenue, distributions, or yield based on the mere holding of the Token (see G.1).

The governance functionality described in F.2 is expected to be available at or shortly following the Token’s admission to trading, accessed by staking GROVE.

In the future, staked GROVE may be used to activate further participation in or access to functions within the Grove ecosystem. Any such future functionality is subject to protocol development, governance approval and applicable regulatory frameworks. There is no guarantee that any further functionality will be made available by any particular time, or at all.

See field 08. GROVE is a fungible, transferable ERC-20 token classified as a crypto-asset other than an asset-referenced token or e-money token. It operates on the Ethereum blockchain (a Proof-of-Stake network). GROVE does not represent ownership, profit rights or legal claims.

N/A. The issuer’s only activity is the issuance of the Token; it does not provide any other services.

Holders of GROVE do not acquire any ownership interest, equity, profit participation, dividend, redemption right, or other contractual claim against Grove, Grove Foundation, the issuer, or any affiliated entity by virtue of holding the Token, nor any right to protocol revenue or yield based on the mere holding of the Token.

Any rights are limited to the Token’s protocol-level functionality: initially, participation in governance processes (accessed by staking GROVE), at which stage holders may participate in community votes that act as a check on team-led proposals, including by voting to reject such proposals. Such functionality is in each case subject to the applicable protocol rules, technical constraints, and governance processes in effect at the relevant time, and subject to the qualifications in F.2, F.3 and G.3.

Holders are responsible for the payment of any fees or network costs required to transact in the Tokens, for maintaining control over their Tokens, and for complying with applicable laws.

Any functionality associated with GROVE may be exercised solely through the technical means made available for that purpose, including interaction with smart contracts or interfaces that support the relevant functionality (such as staking, which is required for Token holders to participate in governance processes). Use of the Tokens is subject to the applicable protocol rules, governance decisions, and technical conditions in effect at the relevant time.

The functionalities associated with the Token may be modified as a result of governance decisions or protocol upgrades. After initialisation, the GROVE token contract has only the Sky governance pause proxy (MCD_PAUSE_PROXY) as its authorised admin, meaning administrative actions on the token contract are authorised through Sky governance.

Token holders should not assume that any current or intended functionality will remain unchanged or continue to be available indefinitely.

As at the date of this white paper, the issuer does not intend to conduct any future public offering of the Token. 

GROVE has no protocol-level restrictions on transferability and functions as a standard ERC-20 token with full transferability.

Centralised exchanges and crypto-asset service providers (CASPs) may impose their own restrictions, including geographic limitations, minimum or maximum transfer amounts, KYC or AML requirements, wallet whitelisting, or temporary holds for security or compliance purposes.

Tokens allocated to contributors to the Grove protocol are subject to defined vesting and unlock schedules to support long-term alignment.

Subject to mandatory applicable law, any dispute arising out of or in connection with this white paper and all claims in connection with the Token shall be governed by and construed and enforced in accordance with the laws of the British Virgin Islands, without regard to conflict-of-law rules that would cause the application of the laws of any other jurisdiction.

Subject to mandatory applicable law, any dispute arising out of or in connection with this white paper and all claims in connection with the Token, including the validity, invalidity, breach or termination thereof, shall be exclusively subject to the jurisdiction of the courts of the British Virgin Islands.

The Token follows the ERC-20 technical standard and is deployed using the SDAO contract from the Sky Endgame Toolkit — an ERC-20 token with role-based access control and EIP-2612 permit support. The ERC-20 standard is widely supported by wallets, exchanges, and other infrastructure providers.

Token contract address: 0xB30FE1Cf884B48a22a50D22a9282004F2c5E9406 (Ethereum mainnet). Decimals: 18. Interactions involving GROVE are executed through smart contracts deployed on Ethereum and are subject to the technical standards, protocols and rules of the underlying blockchain.

As an ERC-20 token, GROVE can be held, stored and transferred using any Ethereum-compatible wallet (self-custodial or third-party-custodied). After initialisation, the GROVE token contract has only the Sky governance pause proxy (MCD_PAUSE_PROXY) as its authorised admin.

The Token does not have its own consensus mechanism. Transactions involving GROVE are validated and finalised in accordance with the consensus mechanism of the Ethereum blockchain, which operates under a Proof-of-Stake model.

Fees and network costs associated with transactions involving the Token are determined by the Ethereum blockchain. Ethereum validators are rewarded through transaction fees and newly issued ETH; under EIP-1559 the base-fee portion of each transaction is burned. These incentive mechanisms and fees are not controlled by Grove or its affiliated entities.

The GROVE token contract was audited as part of the Sky Endgame Toolkit by ChainSecurity and by Spearbit (via the Cantina platform). More broadly, the Grove protocol takes a multi-layered approach to smart-contract security: each protocol component undergoes at least two independent audit rounds per major version release, conducted by separate firms, complemented by formal verification through Certora. Current audit partners are ChainSecurity, Spearbit (Cantina) and Certora. All findings are remediated and verified before deployment to production.

Audit reports are publicly available at https://docs.grove.finance/security.

Neither Grove (BVI) Ltd. nor Grove Foundation operates, controls, oversees or manages the functioning of the trading platforms on which the Token will be admitted to trading. The protocol and its governance may also evolve in response to technical, regulatory and industry developments. The principal risks relating to the admission to trading include the following:

• Regulatory compliance: evolving regulatory frameworks could affect the classification, trading status or market acceptance of GROVE, and may require changes to the operation, structure or governance of the protocol.

• Market volatility: the price of GROVE may be highly volatile, driven by speculation, market sentiment and broader industry trends, and holders may lose some or all of the value of their tokens.

• Liquidity: the ability to buy or sell GROVE depends on trading activity on decentralised and centralised trading platforms; limited liquidity may make it difficult to execute larger trades without significant price impact.

• Trading platforms: when holders trade on a platform, neither the issuer nor the Foundation is a party to those transactions; the legal relationship is governed by the relevant platform’s terms, and neither entity assumes responsibility for a platform’s operations or outcomes.

• Delisting: there is no guarantee that GROVE will remain listed on any platform, and delisting could reduce liquidity and market value.

• Platform insolvency: a trading platform on which GROVE is held may become insolvent or cease operations, potentially resulting in loss of access to tokens.

• Governance and supply: while no change to the total supply is currently anticipated, the GROVE token contract retains a minting function controlled by Sky governance, which could in the future be used to increase the supply of GROVE.

• No guarantee of market price / value: GROVE is not backed by any asset, reserve or guarantee; its market price is determined by supply and demand.

The issuer’s sole function is to issue and distribute the Token. It does not manage or operate any technical infrastructure, oversee governance processes, or control the protocol or community. The principal risks relating to the issuer include the following:

• Limited operational role: because of this limited role, the issuer cannot respond to technical failures, governance disputes or security incidents in the broader ecosystem; if issues arise after distribution (such as smart-contract bugs or changes in network governance), the issuer has no authority or capacity to intervene.

• Early-stage entity: the issuer was recently established and has no reviewed historical financial statements; there is no assurance that it will continue to operate or deliver its planned contributions.

• No claim against the issuer: GROVE does not represent ownership of, or any contractual claim against, the issuer; a holder’s reliance on the issuer is limited to the issuance of the token.

• Decentralised governance: developments after distribution depend on decentralised governance (including Sky governance and Grove community governance) and on third-party contributors, over whom the issuer has no control.

• Regulatory and legal: the issuer may be subject to investigations, adverse rulings or changing legal and compliance obligations, any of which could require changes to its operations, structure or governance, or result in costs or liabilities.

• Market volatility: the value of GROVE is expected to be highly volatile and may fluctuate due to speculation, sentiment, regulatory developments and macroeconomic conditions, potentially resulting in total loss of value.

• Liquidity: low trading volume or limited demand may make it difficult to acquire or dispose of GROVE without significant price impact.

• Private-key management: holders are solely responsible for safeguarding their private keys and recovery phrases; loss of these credentials will result in the permanent and irreversible loss of GROVE.

• Scams and fraud: holders are exposed to scams, phishing, impersonation, counterfeit tokens and fraudulent airdrops; engaging with unverified platforms or communications increases this risk.

• Adoption and demand: the long-term value and utility of GROVE depend on adoption of the Grove protocol, which is influenced by external factors outside the control of the issuer or the Foundation.

• Regulatory: the legal and regulatory treatment of crypto-assets differs across jurisdictions and is subject to change, which could affect the classification, availability or functionality of GROVE.

• Vesting and token release: tokens subject to vesting and unlock schedules (such as those granted to project team members and other contributors) may, when released into circulation, introduce additional selling pressure that could affect the market price of GROVE.

Neither Grove (BVI) Ltd. nor Grove Foundation operates, controls, oversees or manages the technology underlying the Grove protocol. The success and sustainability of the project depend on external factors, including market conditions, regulatory developments and technological change. The principal risks relating to project implementation include the following:

• Credit and counterparty risk: the Grove protocol deploys stablecoin liquidity into credit strategies, which are subject to credit, counterparty, market and liquidity risks. Adverse performance of these strategies could affect the protocol. GROVE does not represent a claim on, or direct economic exposure to, the protocol’s assets or credit portfolio, and holders have no right to those assets.

• Dependence on the Sky ecosystem: Grove operates as a Prime Agent (subDAO) within the Sky ecosystem and relies on Sky for liquidity, governance and resources. Adverse developments affecting Sky, or changes in the relationship between Grove and Sky, could materially affect the protocol.

• Technical development: unforeseen vulnerabilities or bugs in smart contracts could disrupt the protocol’s functionality; the protocol relies on open-source software that may be modified by third parties.

• Regulatory and compliance: regulatory inquiries or actions, or new and changing laws, could restrict the further development, implementation or use of the protocol or GROVE.

• Governance: decision-making through decentralised governance may be inefficient, slow, or disproportionately influenced by particular stakeholders, leading to centralisation or unfavourable outcomes.

• Adoption and competition: the project competes with other, potentially better-resourced projects, and may fail to attract sufficient users, developers and participants.

• Ecosystem and third parties: the project relies on infrastructure providers and other third-party services; failure or delay by these parties could disrupt implementation.

• Smart-contract risk: despite audits and security best practices, unforeseen vulnerabilities in smart contracts could lead to security breaches affecting the security or functionality of GROVE; certain deployed contracts may be immutable, so errors may not be correctable.

• Blockchain dependency: GROVE relies entirely on the Ethereum network, which may experience outages, congestion, downtime, forks or consensus failures; gas fees fluctuate, and transactions sent in error are generally irreversible.

• Settlement and finality: Ethereum transactions are designed to be irreversible, but under exceptional circumstances (such as forks or consensus failures) there is a theoretical risk that transactions could be reversed; transfers to an incorrect address are not recoverable.

• Cybersecurity: wallets, bridges, oracles and front-end applications are targets for cyberattacks; a successful attack could disrupt services or lead to loss of assets.

• Reliance on third-party services: many blockchain services, including wallets, bridges and oracles, depend on third-party providers, and failures, breaches or regulatory actions against them could affect the functionality of GROVE.

The Grove protocol applies a number of measures to mitigate the risks described above, across technical, operational and governance layers:

• Smart-contract audits: each protocol component undergoes at least two independent audit rounds per major version release, conducted by separate firms (ChainSecurity and Spearbit (Cantina)), complemented by formal verification through Certora; findings are remediated and verified before deployment. Audit reports are available at https://docs.grove.finance/security.

• Operational safeguards: a FREEZER role provides an emergency capability to halt automated operations, and a RateLimits mechanism enforces time-based limits on capital movements.

• Decentralised governance: governance through Sky and Grove community mechanisms aims to provide checks and balances and limit centralised control.

• Transparent communication: ongoing disclosure through public documentation and the Grove Data dashboard supports informed decision-making.

• Regulatory alignment: the project monitors legal and regulatory developments in key jurisdictions, including under MiCA.

These measures reduce, but do not eliminate, the risks described above. Holders should exercise caution and adopt their own risk-management practices when acquiring or holding GROVE.

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The Ethereum network, which GROVE relies on, operates using a Proof-of-Stake consensus mechanism.

In this system, validators are chosen to propose and attest to new blocks and validate transactions based on the amount of ETH they have staked as collateral.

The validators who secure the network are rewarded with economic incentives for their work. These incentives consist of transaction fees paid by users and newly issued ETH block rewards, while the base fee portion of each transaction is burned and removed from circulation under EIP-1559.

Data provided by CCRI (Crypto Carbon Ratings Institute). All indicators are based on a set of assumptions and thus represent estimates. A methodology description and an overview of input data, external datasets and underlying assumptions are available at carbon-ratings.com/dl/whitepaper-mica-methods-2024 and docs.mica.api.carbon-ratings.com. Grove does not account for any offsetting of energy consumption or other market-based mechanism as of today. Last review: 2026-05-20.