Summary
Riot Platforms, Inc. ("Client") and Coinbase, Inc. ("Coinbase") entered into a prime brokerage agreement effective December 16, 2024. Under this agreement, Coinbase provides Riot with comprehensive prime brokerage services for digital assets and cash, including:
- Custody
- Trade execution
- Lending
- Post-trade credit (if applicable)
The agreement outlines account management, instruction protocols, and compliance responsibilities. Key provisions include conflict-of-interest disclosures, monthly account statements, and operational safeguards.
Key Terms and Conditions
1. Scope of Services
- PB Services: Custody, trade execution, lending, and related activities for digital assets ("Client Digital Assets") and cash ("Client Cash").
Accounts:
- Trading Account (for trade execution)
- Vault Account (for cold storage via Coinbase Custody Trust Company, LLC).
2. Client Responsibilities
- Compliance with all applicable laws (AML, Sanctions, etc.).
- Provision of accurate KYC/AML documentation.
- Adherence to Coinbase’s Prohibited Use Policy.
3. Conflicts of Interest
Client acknowledges potential conflicts, including:
- Orders routed to Coinbase’s exchange platform.
- Coinbase acting as principal for certain trades.
- Coinbase’s awareness of pending orders (not front-running).
4. Account Statements
Coinbase provides monthly electronic statements detailing:
- Cash and digital asset balances.
- Transaction history.
5. Fee Structure
- Commissions and network fees apply.
- Unpaid fees may be deducted from Client Assets.
6. Risk Disclosures
- Digital assets are not FDIC-insured.
- Volatility, regulatory changes, and operational risks may impact valuations.
FAQs
1. How are conflicts of interest managed?
Coinbase maintains policies to mitigate conflicts, including transparent order routing and prohibitions on front-running.
2. What happens if Coinbase ceases support for a digital asset?
Clients receive 30 days’ notice (unless legally required to act sooner) to withdraw affected assets.
3. Are Client Assets insured?
- Cash: Held in FDIC-pass-through-eligible accounts (up to $250,000 per depositor).
- Digital Assets: Stored in segregated cold/hot wallets but not FDIC-insured.
4. Can Coinbase lend Client Assets?
No, unless explicitly authorized by Client in writing.
Engaging Anchor Texts
👉 Explore secure digital asset custody
👉 Learn about institutional trading solutions
Additional Provisions
1. Governing Law
New York law governs the agreement, with arbitration required for disputes (administered by JAMS).
2. Termination
- 30 days’ notice for standard termination.
- Immediate suspension for Events of Default (e.g., insolvency, material breach).
3. Limitation of Liability
Coinbase’s liability is capped at fees paid in the prior 12 months (except for fraud/willful misconduct).
Confidential details marked as [***] are omitted per the registrant’s discretion.