To participate in IPOs on Bitso, there are some requirements you need to meet. They are part of the rules of the US financial market and are designed to protect you as a participant. Here's what each one means.
Who can participate in IPOs on Bitso?
Any Bitso user with an active account in good standing can participate in IPOs, as long as they are not a restricted person under FINRA rules.
The first time you participate, we'll ask you to confirm three points:
- That you are not a restricted person under FINRA. FINRA rules 5130 and 5131 prohibit certain people with ties to the financial sector from participating in IPOs. This includes employees of investment banks, broker-dealers, and their immediate family members, among others. If you have no ties to the financial sector, you are most likely not a restricted person.
- That you understand the flipping policy. Flipping is the sale of shares obtained in an IPO within the 30 days following the stock market debut. This practice is restricted and may affect your access to future IPOs on Bitso.
- That you are aware of the risks of participating in IPOs. I am aware of the risks of this type of operation and understand that it is my responsibility to evaluate whether they are suitable for my objectives, time horizon, and risk tolerance.
What happens if I sell my shares too soon?
By participating in an IPO on Bitso you accept the flipping policy. Flipping is the sale of shares obtained in an IPO within the 30 days following the stock market debut.
If you sell within that period, it may affect your access to future IPOs on Bitso. We recommend keeping this in mind before submitting your request.
What happens if I don't meet these requirements?
If you are a restricted person under FINRA rules, you will not be able to participate in IPOs on Bitso. This restriction is not a decision made by Bitso but a regulatory requirement of the US financial market.
If you have doubts about whether you qualify as a restricted person, we recommend consulting FINRA rules 5130 and 5131 directly.