Private Equity Risk Warnings
Investing in startups and early stage businesses can be very rewarding, but it involves a number of risks and challenges. If you choose to invest through BnkToTheFuture.com, you need to be aware of and accept five important considerations.
The following list of risk factors does not purport to be a complete enumeration or explanation of the risks involved in investing in any of the companies pitching for investment via the BnkToTheFuture.com website. Each individual company will be different and specific risks will attach to that investment. Prospective investors should review the individual companies’ pitches in their entirety and consult with their own advisers before making any decision to invest.
Any investment you make through the platform will be highly illiquid. While secondary markets may exist, there is no highly liquid secondary market for the shares of the investee company. This means that you are unlikely to be able to sell your shares until and unless the investee company floats on a securities exchange or is bought by another company. Even for a successful business, a flotation or purchase is unlikely to occur for a number a years from the time you make your investment.
Investing in startups should only be done as part of a diversified portfolio. This means that you should invest relatively small amounts in multiple businesses rather than a lot in one or two businesses. It also means that you should invest only a small proportion of your investable capital in startups as an asset class, with the majority of your investable capital invested in safer, more liquid assets.
3. Rarity of Dividends
Startups and early stage businesses rarely pay dividends. This means that if you invest in a business through the platform, even if it is successful you are unlikely to see any return of capital or profit until you are able to sell your shares in the investee company. Even for a successful business, this is unlikely to occur for a number of years from the time you make your investment.
Any investment you make through the platform is likely to be subject to dilution. This means that if the business raises additional capital at a later date, it will issue new shares of the investee company to the new investors, and the percentage of the investee company that you own will decline. These new shares may also have certain preferential rights to dividends, sale proceeds and other matters, and the exercise of these rights may work to your disadvantage. Your investment may also be subject to dilution as a result of the grant of options (or similar rights to acquire shares) to employees of, service providers to or certain other parties connected with, the investee company.
5. Loss of Capital
Most startups fail, and if you invest in a business through the platform, it is more likely that you will lose all of your invested capital than that you will see a return of capital or a profit. You should not invest more money through the platform than you can afford to lose without altering your standard of living.
6. Indirect investment via a SPV
You should read all the offering materials available to you regarding the pitch (“Offering Materials”) with respect to a transaction prior to making an investment of any type. You should also understand that investments through BnkToTheFuture.com may be direct or indirect investments to the underlying pitch as described more fully in the Offering Materials.
Secondary Market Risk Warnings
THERE IS NO PROMISE OF A SECONDARY MARKET AND ALL INVESTMENTS IN PRIVATE PLACEMENTS ARE REQUIRED TO BE HELD FOR AT LEAST ONE YEAR, BUT SHOULD SUCH A SECONDARY MARKET EXIST IN THE FUTURE AFTER THE ONE YEAR HOLDING PERIOD IT IS IMPORTANT TO UNDERSTAND THE ADDITIONAL RISKS MAY APPLY.
References to “our secondary market” on the platform refer to the facility made available to Investor Members on the BF platform to facilitate the transfer of existing investments between Investor Members.
Securities can be subject to restrictions on trading (Please refer to investment documents on pitch for details)
1. Incomplete Information
Directors of the underlying companies often have more information than shareholders. Employees may know things that you do not know about the company. Existing investors that you may be purchasing these shares from most likely have more information about the history and status of the underlying company than you. New investors will have the least Information and therefore take the most risk.
When purchasing shares through a SPV model you are subject to greater risks than direct shareholders due to a lack of Information about the underlying company owned by the SPV. You may be buying shares from a director, employee or shareholder who may have significantly more information than you that may lead to the complete loss of your investment capital as they are not subject to the same disclosure and reporting rules of a publicly traded company.
2. Indirect investor
You are not buying direct shares in the company listed. The shares will be owned by a Special Purpose Vehicle (SPV) held and operated by Bnk To The Future Capital SPC and Bnk To The Future. A more comprehensive understanding of the structure is disclosed below and should be read and understood before investing.
3. Information Rights
As a SPV shareholder you do not have Information or voting rights in the underlying companies. While we will do all we can to represent shareholder interests and exercise any voting or information rights we may have, you will not have any right to vote or request further company Information.
4. No Voting Rights
All shares on our secondary market come with no voting rights unless otherwise stated. if you purchase shares on our secondary market, these are non-voting shares and may not be attractive to potential buyers. When listing your shares on our secondary market you may lose any right to vote you may have previously held and you should read the terms carefully.
ETH Staking Risk Warnings
Risk Warning: Staking ETH involves certain risks that you should be aware of before making any investment decisions. Please consider the following risk warning carefully:
1. Volatility of Cryptocurrencies
Cryptocurrencies, including ETH, are known for their price volatility. The value of your staked ETH may fluctuate significantly, and you may experience gains or losses based on market conditions.
2. Technical and Operational Risks
Staking ETH requires technical expertise and understanding of the underlying blockchain technology. There is a risk of technical failures, network disruptions, hacking attempts, or other operational issues that could impact the security and performance of the staking process.
3. Regulatory and Legal Risks
The regulatory landscape surrounding cryptocurrencies and staking activities is evolving and subject to change. There may be uncertainties and potential legal or regulatory risks associated with staking ETH, including tax obligations, compliance requirements, and restrictions imposed by regulatory authorities.
4. Slashing and Penalties
Validators in ETH staking are subject to penalties, known as slashing, for improper behavior or failure to meet their obligations. These penalties can result in a loss of a portion of the staked ETH.
5. Market and Liquidity Risks
The liquidity of staked ETH may vary, and it may not be easily convertible or accessible when desired. In certain market conditions or during network upgrades, there may be limitations or delays in accessing your staked assets.
6. Technology and Security Risks
Staking ETH involves interacting with smart contracts, decentralized networks, and third-party platforms. There is a risk of potential vulnerabilities, bugs, or security breaches that could result in the loss or theft of your staked assets.
7. Past Performance is Not Indicative of Future Results
The historical performance of staking activities or returns earned by other investors is not a guarantee of future performance. Staking outcomes are subject to various factors, including market conditions and network dynamics.
It is important to note that the above risk warning is not exhaustive and does not cover all potential risks associated with staking ETH. We strongly recommend conducting thorough research, understanding the risks involved, and consulting with a qualified professional before engaging in ETH staking or any other investment activity.
Please carefully consider these risks and assess your risk tolerance and investment objectives before proceeding with ETH staking.
Bitcoin Risk Warnings
Risk Warning: Investing in Bitcoin involves certain risks that you should carefully consider before making any investment decisions. Please review the following risk warning based on the information provided in the emails:
1. Volatility of Bitcoin
Bitcoin is known for its price volatility, and its value can fluctuate significantly over short periods. The price of Bitcoin may experience rapid changes, which can result in potential gains or losses on your investment.
2. Market Risk
The value of Bitcoin can be influenced by various factors, including market demand, regulatory developments, geopolitical events, and macroeconomic conditions. These factors can impact the price and liquidity of Bitcoin and may affect your investment returns.
3. Security Risks
Bitcoin transactions rely on blockchain technology and cryptographic protocols. However, there are security risks associated with the storage and transfer of Bitcoin. Cyberattacks, hacking attempts, phishing, or malware attacks could lead to the loss or theft of your Bitcoin holdings.
4. Regulatory and Legal Risks
The regulatory environment surrounding Bitcoin is evolving, and regulatory actions or changes in laws can impact the legality, use, and taxation of Bitcoin. There may be uncertainties and potential regulatory risks associated with investing in Bitcoin.
5. Operational Risks
Bitcoin transactions are facilitated through digital wallets, exchanges, and other service providers. There is a risk of technical failures, system outages, exchange hacks, or fraudulent activities that could affect the security and accessibility of your Bitcoin.
6. Liquidity Risks
The liquidity of Bitcoin can vary, particularly during periods of high demand or market stress. It may not always be easy to buy or sell Bitcoin at desired prices or volumes, and there could be limitations or delays in executing transactions.
7. Past Performance is Not Indicative of Future Results
The historical performance of Bitcoin or the returns earned by other investors is not a guarantee of future performance. Bitcoin investments are subject to market dynamics, and there is no assurance of future returns.
It is essential to recognize that the above risk warning is not exhaustive and may not cover all potential risks associated with investing in Bitcoin. We strongly advise conducting thorough research, understanding the risks involved, and seeking advice from a qualified professional before investing in Bitcoin or any other digital asset.
Please carefully assess your risk tolerance, financial situation, and investment objectives before engaging in Bitcoin investment activities.
Stablecoin Risk Warnings
Risk Warning: Investing or holding stablecoins involves certain risks that you should consider before making any investment decisions. Based on the information provided, here is a risk warning specifically tailored to stablecoins:
1. Counterparty Risk
Stablecoins are typically issued by private entities or centralized organizations. There is a risk that the issuer may face financial difficulties, regulatory actions, or other operational challenges that could impact the stability or availability of the stablecoin. It is important to assess the credibility and reputation of the stablecoin issuer before investing.
2. Price Volatility
While stablecoins aim to maintain a stable value, there can still be instances of price fluctuations. External market factors, changes in demand, or the performance of the underlying assets or mechanisms supporting the stablecoin can affect its value. It is crucial to understand the stability mechanism and any potential risks associated with it.
3. Regulatory and Legal Risks
Stablecoins may operate within regulatory frameworks or face legal considerations in different jurisdictions. Changes in regulations, legal restrictions, or unfavorable regulatory actions could impact the use, transfer, or exchange of stablecoins. It is important to be aware of the regulatory landscape and legal implications associated with stablecoin investments.
4. Liquidity Risk
The liquidity of stablecoins may vary, depending on the demand and availability of trading platforms or exchanges. In certain circumstances, it may be challenging to convert stablecoins back to fiat currencies or other assets at desired prices or volumes. Limited liquidity could affect your ability to access or exit your stablecoin investment.
5. Technology and Security Risks
Stablecoins rely on blockchain technology, smart contracts, and underlying platforms for their operation. There is a risk of technical vulnerabilities, bugs, hacking attempts, or security breaches that could compromise the stability, integrity, or availability of the stablecoin. Understanding the technology infrastructure and security measures is essential when considering stablecoin investments.
6. Regulatory Compliance and Transparency
Stablecoins may be subject to compliance requirements, such as anti-money laundering (AML) and know-your-customer (KYC) regulations. The level of transparency and compliance practices adopted by the stablecoin issuer can impact the regulatory and legal risks associated with the stablecoin. It is important to ensure that the stablecoin issuer adheres to relevant regulations and industry best practices.
7. Stablecoin De-Pegging Risks
Stablecoins aim to maintain a fixed value relative to a specific asset, such as a fiat currency. However, there is a risk that the stablecoin may experience de-pegging or deviations from its intended value. Factors such as market volatility, insufficient collateralization, or regulatory actions can contribute to de-pegging. Investors should be aware that stablecoins are not immune to price fluctuations and may not always maintain a stable value.
8. Fractional Reserve Banking Risks
Some stablecoins operate on a fractional reserve model, where the stablecoin issuer may not hold sufficient reserves to fully back the stablecoin supply. This can lead to liquidity issues or potential insolvency risks if a significant number of stablecoin holders attempt to redeem their stablecoins for the underlying assets simultaneously. Investors should assess the reserve practices and transparency of the stablecoin issuer to understand the potential risks associated with fractional reserve banking.
This risk warning provides a general overview of potential risks associated with investing or holding stablecoins. However, it is important to note that different stablecoins may have unique characteristics and risks. Before investing in stablecoins, we strongly recommend conducting thorough research, understanding the specific features and mechanisms of the stablecoin, and seeking advice from a qualified professional.
Please carefully assess your risk tolerance, financial situation, and investment objectives before engaging in stablecoin investments.
Virtual Assets Risk Warnings
Risk Warning: Investing in virtual assets involves certain risks that you should consider before making any investment decisions. Based on the information provided in the emails, here are some risk warnings specifically related to virtual assets:
1. Price Volatility
Virtual assets, including cryptocurrencies, can be highly volatile, with significant price fluctuations occurring over short periods. The value of virtual assets can be influenced by various factors, such as market demand, regulatory developments, technological advancements, and investor sentiment. Price volatility can lead to potential gains or losses on your investment.
2. Regulatory and Legal Risks
The regulatory landscape for virtual assets is evolving and can vary across jurisdictions. Changes in regulations, legal restrictions, or unfavorable regulatory actions may impact the use, transfer, taxation, and overall acceptance of virtual assets. It is important to stay informed about the regulatory environment and any legal implications associated with virtual asset investments.
3. Security Risks
Virtual assets are stored and transferred using digital wallets, exchanges, or other platforms, which may be vulnerable to cybersecurity threats, hacking attempts, fraud, or technical failures. The loss, theft, or unauthorized access to your virtual assets can result in financial losses. It is crucial to adopt robust security measures, including strong passwords, two-factor authentication, and proper wallet management practices.
4. Liquidity Risks
The liquidity of virtual assets can vary, depending on the market demand and availability of trading platforms or exchanges. Limited liquidity may make it challenging to buy or sell virtual assets at desired prices or volumes, potentially impacting your ability to access or exit your investment.
4. Technology and Operational Risks
Virtual assets rely on blockchain technology, smart contracts, and decentralized networks. However, these technologies may be subject to technical vulnerabilities, bugs, programming errors, or other operational risks. Understanding the underlying technology and the risks associated with it is essential when investing in virtual assets.
5. Lack of Regulation and Investor Protection
Virtual assets operate outside traditional financial systems and may not be subject to the same investor protection measures as regulated financial instruments. The absence of clear regulations, oversight, or deposit insurance can expose investors to potential risks, such as fraudulent schemes, scams, or inadequate recourse in case of disputes.
6. Information and Market Risks
The virtual asset market can be influenced by rumours, misinformation, market manipulation, or speculative trading. It is important to exercise caution when relying on information sources and to conduct thorough research before making investment decisions.
This risk warning provides a general overview of potential risks associated with investing in virtual assets. However, it is crucial to recognize that different virtual assets may have unique characteristics and risks. Before investing in virtual assets, we strongly recommend conducting thorough research, understanding the specific features of the assets, and seeking advice from a qualified professional.
Please carefully assess your risk tolerance, financial situation, and investment objectives before engaging in virtual asset investments.
Platform Risks & Disclosures
BnkToTheFuture.com is targeted exclusively at investors who are sufficiently sophisticated to understand these risks and make their own investment decisions. You will only be able to invest via BnkToTheFuture.com once you are registered as an appropriately accredited or sophisticated investor (‘Qualifying investor’ or ‘Member’). Investments may lose value, there are no guarantees, securities and investments are not FDIC Insured and neither Bnk To The Future, its affiliated companies, nor our affiliated broker-dealer BMI Capital offer investment, legal or tax advice.
Other activities may involve engagements with Bnk To The Future Capital SPC (company number 298427) Incorporated and registered in Cayman Islands under the Companies Law 2013 and other affiliated companies depending on your country of residence including BMI Capital International LLC and other regulated companies.
US residents agree to register with BMI Capital International LLC, a registered US broker-dealer with FINRA and member of SIPC, who operate sections of BnkToTheFuture.com where Regulation D offerings filed with the SEC are conducted. Activities with respect to US resident investors are conducted by BMI Capital International LLC. Registration does not imply a certain level of skill or training. Individuals and firms may only transact business in a jurisdiction after satisfying its licensing and qualification requirements or after being excluded or exempted.
Registration does not imply a certain level of skill or training. Individuals and firms may only invest in compliance with the relevant regulations applicable in their jurisdictions.
Pitches for investment are not offers to the public and investments can only be made by members of BnkToTheFuture.com on the basis of information provided in the pitches by the companies concerned.