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Deduplication vs FSRM hard quotas

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I was reading about deduplication on Windows Server 2012 R2 when I found this limitation:

https://technet.microsoft.com/en-ca/library/hh831454.aspx

"Creating a hard quota on a volume root folder that also has deduplication enabled is not supported. When a hard quota is present on a volume root, the actual free space on the volume and the quota restricted space on the volume are not the same. This may cause deduplication optimization jobs to fail. 

Creating a soft quota on a volume root that has deduplication enabled is supported. When FSRM quotas encounter a deduplicated file, File Server Resource Manager accounts for it based on the file’s logical size. Quota usage (including any quota thresholds) does not change when a file is processed by deduplication. All other FSRM quota functionality, including volume-root soft quotas and quotas on subfolders, work normally when using deduplication."

I'm not sure how I should interpret this. 

I see two possible ways:

1) Hard quotas are unsupported ONLY if applied on the root of a deduplicated volume and OK on folders stored on that same volume.

2) Only soft quotas are supported.

Which one is the right way to understand this ? (I prefer the first one ;) ).

Thanks




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