Plain English Alpaca Crypto Customer Agreement

Set out below is a summary of the Alpaca Crypto Customer Agreement (Agreement). THIS DOCUMENT IS NOT A SUBSTITUTE FOR YOU READING AND UNDERSTANDING THE AGREEMENT IN ITS ENTIRETY.

The Agreement sets out the terms and conditions which governs the relationship between Alpaca and its customers and the customers’ use of Alpaca’s trading platform (Platform) with respect to cryptocurrencies. The Agreement refers to other supplementary documents, some of which will form part of the Agreement. Please ensure that you also read through and understand any supplementary documentation. The Agreement should be read in conjunction with the Alpaca Customer Agreement.

As a guide for potential customers, we have prepared this executive summary which provides a general overview of some of the Agreement’s key provisions and implications.  

1. Creating and Maintaining Account

Customers must be legally permitted to open an account with Alpaca (including with respect to the laws and regulations of the customers jurisdiction). If a customer resides in a jurisdiction which restricts or prohibits the trading of cryptocurrencies, Alpaca may refuse to open an account.

As part of the on-boarding process Alpaca may require specific information from its customers for compliance, Anti Money Laundering (AML) / Combating the Financing of Terrorism (CFT) and safety purposes. This information may include (but is not limited to), copies of a customer’s identification, credit history reports, Politically Exposed Person (PEP) checks and proof of address. All information provided to Alpaca must be accurate and up to date. If a customer is based outside of the United States of America they may be subject to more extensive due diligence. Certain customer information may be disclosed by Alpaca to third parties.

Customers are responsible for keeping their accounts in good standing, including keeping their login/pin details secure. If a customer wishes to grant a third-party control over their pin and/or account, they must have a Limited Power of Attorney in place and submit this to Alpaca. Customers will remain responsible for a third party’s actions over a customer’s account and Alpaca is not liable for any losses resulting from the actions by the customer or a third party.

Customers confirm that they are, at all times, complying with all applicable laws and regulations (including with respect to tax). Alpaca may require customers to provide certain information for tax purposes.

1. Termination of Account

Alpaca may terminate, deactivate or block a customer’s account at any time and for any reason. If a customer operates their account in an illegal or inappropriate manner or engages in inappropriate behaviour with Alpaca or its employees/agents, this will almost certainly result in the termination of the customer’s account.

In the event a customer’s account is terminated they may first request that their remaining cryptocurrency be transferred to a separate external crypto wallet or permit Alpaca to sell the crypto on their behalf. Customers will remain liable for any costs associated with account closure.

1. Representations and Warranties

By signing the Agreement, customers represent and warrant to Alpaca that (among other things) all information provided to Alpaca is true and correct and that the customer has carefully reviewed, understood and agrees to the terms and conditions of the Agreement, including those supplementary documents referred to within the Agreement.

1. Trading Authorization

Accounts on the Platform are self-directed. Once a customer has successfully created an account, they grant Alpaca authority to carry out their directions. Transactions will only be processed with the Customer’s authorisation and customers are solely responsible for all orders placed through their account. Customers are legally required to complete all transactions which have been processed (including payment of the purchase price). Alpaca may take formal steps to recover its losses from customers who have insufficient credit to pay for transactions which have been processed by Alpaca.

All trades placed through the Platform are deemed to be correct and it is the customer’s responsibility to review trades prior to and after they have been executed.

1. Separate Services

Customers understand that the services provided by Alpaca Crypto in relation to cryptocurrencies are distinct from those offered by Alpaca Securities.

1. Network Fees

Each cryptocurrency network may assess network or miner’s fees in order to process transactions on the relevant network. Prior to the customer authorising the transaction, Alpaca will provide an estimate of the network fees required for the relevant cryptocurrency network to process the transaction within a reasonable amount of time, as determined solely by the customer. The customer understands that the estimated network fees may vary depending on network congestion or other network issues, which are outside of Alpaca’s control. The customer is responsible for all transaction fees.

1. Risk Disclosure

The Agreement emphasises the risks inherent in the trading of cryptocurrencies. Customers acknowledge and understand that investing in cryptocurrencies may result in losses that exceed the customer’s initial investment. Past performance of a cryptocurrency does not guarantee future performance or returns. All customers should consider their risk profile and financial position before deciding whether to invest in cryptocurrencies.

Cryptocurrencies are not subject to the same regulations and consumer protections as securities which increase the risk profile of the customer. Customers acknowledge that price fluctuation is inherent to the cryptocurrency market. Alpaca is not liable for price fluctuations.

As required by regulation, Alpaca is required to disclose certain information to customers as part of the transaction process.

1. Sending/Receiving Cryptocurrencies

Customers must understand that cryptocurrency transactions cannot be reversed once they have been broadcast to the relevant cryptocurrency network. The customer takes sole responsibility for ensuring the accuracy of the transaction. If a cryptocurrency is inadvertently sent to an incorrect receiving address, it is likely to be lost forever. Alpaca is not responsible for losses incurred by customers in this respect.

1. Trading Restrictions

Alpaca in its sole discretion may prohibit or restrict the trading of cryptocurrencies without notice or customers’ prior approval and may refuse to accept any buy/sell orders placed by its customers. In addition, Alpaca may restrict access to the use of its App or its website without notice.

Alpaca may impose trading or volume limits on a customer’s account without notice and its sole discretion.

If a customer accesses their account from a jurisdiction which prohibits the trading of cryptocurrencies, Alpaca may restrict or terminate their account(s). In addition, Alpaca may refuse the sending or receiving of cryptocurrencies to/from persons within prohibited jurisdictions.

1. Delisting or Non-Supported Cryptocurrencies

Where a customer makes an order for a cryptocurrency which is delisted or is no longer supported, the order will immediately be closed. If a cryptocurrency is likely to be delisted, and Alpaca believes the delisting will have a detrimental effect on trading, Alpaca is authorised to sell a customer’s cryptocurrency on behalf of a customer without notice or prior approval.

1. Cryptocurrency Networks

Forks: Alpaca does not own or control the software protocols which govern the way the blockchain functions. This is usually open source and as such, Alpaca makes no guarantee of their functionality, security or availability. These protocols are subject to change. Alpaca may respond to these changes and take all steps necessary to protect the security and safety of the Platform. The customer understands that Alpaca is not responsible for any loss resulting from any change in the underlying protocols (or similar operating changes).

Airdrops: Cryptocurrency projects or companies may make unsolicited deposits of cryptocurrencies into numerous wallets (often as a way to market a new coin and encourage acceptance and adoption (commonly called an Airdrop)). In all cases of Airdropped cryptocurrencies sent to Alpaca Crypto wallets, Alpaca has absolute discretion to determine how to respond to the Airdrop including liquidating any Airdropped cryptocurrency a customer may have received.

1. Regulatory Protections Not Applicable

Funds held by Alpaca for the trading of cryptocurrencies are not subject to the same Federal Deposit Insurance Corporation (FDIC) insurance or Securities Investor Protection Corporation (SIPC) protections. Accordingly, customers are not afforded the same protections which apply to funds held by Alpaca for securities trading.

1. Omnibus Crypto Wallets

Alpaca may hold cryptocurrency together with other customers’ cryptocurrency in one or more omnibus wallets. Alpaca may delegate custody functions (including holdings and storing of private keys) to third parties. Alpaca will exercise reasonable skill and care in the selection of the custodians. However, if the custodian is declared insolvent, or engages in malfeasance, it is unclear what may happen to a customer’s cryptocurrencies. Customers may likely be treated as an unsecured creditor, or a customer may completely lose their crypto. Alpaca is not liable for any losses incurred by customers in this respect.

1. No Investment Advice

Neither Alpaca nor its employees provide investment advice or will recommend customers undertake any transaction. Alpaca may provide customers with research materials for educational purposes only. Alpaca take no responsibility for their accuracy and should not be relied upon. Customers understand that at no point will communications, services or other interactions between Alpaca and its customers constitute investment advice or otherwise.

1. No liability on Alpaca

Alpaca reiterates throughout the Agreement that it is not responsible or liable for the losses, costs or damages which its customers may suffer while using the Platform. This includes losses suffered as a result of trading cryptocurrency, a customer’s reliance on data or information, the actions of third parties including actions taken by governments, regulators, security exchanges, up to including malicious actions by bad actors (hackers). Customers will have no claim whatsoever against Alpaca for special, indirect, incidental or consequential damages or losses incurred while using the Platform.

Alpaca and its affiliates are not responsible or liable for any acts or omissions by any exchange, clearing organisation, or third parties or their respective agents or affiliates. Customers agree to indemnify Alpaca for losses arising from the actions of third parties whom the customer allows access to the Platform as well as any losses Alpaca suffers due to the customer or their agent’s alleged misrepresentation, or act or omission.

Customers acknowledge and agree that unless a court of competent jurisdiction determines otherwise, Alpaca is not liable for any costs, losses or damages of any kind regarding matters pertaining to a customer’s account and only to the extent that Alpaca and/or its affiliates actions are determined to be gross negligence or willful misconduct.

All disputes a customer may have with Alpaca shall be settled by arbitration. Each party gives up their right to sue the other in court except as provided by the rules of the arbitration forum. Rather, disputes must be resolved by way of arbitration.

1. Additional Terms and Condition

Telephone Conversations and Electronic Communications

Alpaca may record and monitor any telephone or electronic communications with its customers unless otherwise agreed in writing in advance. Alpaca does not consent to customers recording telephone conversions.

Amendments

Alpaca may amend this Agreement without notice to the customer. The amended version will be posted on Alpaca’s website and a customer’s continued use of the Platform will be deemed acceptance of such changes.