Item 1A. Risk Factors
ITEM 1A. RISK FACTORS
In addition to the risk factor and other information set forth below and elsewhere in this Report, you should carefully consider the information set forth in Part 1, Item1A. “Risk Factors” in our Annual Report on Form 10-K
for the fiscal year ended December 31, 2020 and our Quarterly Report on Form 10-Q
for the quarter ended June 30, 2021.
We plan to instruct trades and perform other operational processes in respect of crypto basket ETPs that we intend to launch in Europe. Operational failures could materially affect our business and harm investors in these products.
We intend to launch products indexed to baskets of cryptocurrencies in Europe. We plan to outsource the administrator, transfer agent and custodial functions for these products. While we typically outsource portfolio management services to third-party sub-advisers
for our products, in this case, we will instead act as determination agent and place buy and sell orders directly with a broker to rebalance these crypto basket ETPs in line with the indices. These rebalances will occur either quarterly or annually depending on the product. Expanding trading volumes may increase the risk of trading errors. The failure of any of our vendors to provide us and our products with the outsourced services and our failure to correctly place trade orders could lead to operational issues and result in financial loss to us and/or investors in our products.
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