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OTC Markets Group
OTC Markets Group
OTC Markets Group
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OTC Markets Group, Inc. (formerly known as National Quotation Bureau, Pink Sheets, and Pink OTC Markets) is an American financial services corporation that operates a financial market providing price and liquidity information for almost 12,400 over-the-counter (OTC) securities.[3] The group has its headquarters in New York City. OTC-traded securities are organized into three markets to inform investors of opportunities and risks: OTCQX, OTCQB and Pink.

Key Information

History

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The company was first established in 1913 as the National Quotation Bureau (NQB). For decades, the NQB reported quotations for both stocks and bonds, publishing the quotations in the paper-based Pink Sheets and Yellow Sheets respectively. The publications were named for the color of paper on which they were printed. NQB was owned by CCH from 1963 to 1993. In September 1999, the NQB introduced the real-time Electronic Quotation Service.

The National Quotation Bureau changed its name to Pink Sheets LLC in 2000 and subsequently to Pink OTC Markets in 2008. The company eventually changed to its current name, OTC Markets Group, in 2010.[4] Currently, a network of 89 broker-dealers price and trade a wide spectrum of securities on the OTC Markets platform.[5]

To be quoted on the platform, companies are not required to file with the SEC, although many choose to do so.[6] A wide range of companies are quoted on OTC Markets, including firmly established foreign firms, mostly through American depositary receipts (ADRs).[7] In addition, many closely held, extremely small and thinly traded U.S. companies have their primary trading on the OTC Markets platform.

Many foreign issuers adhere to the listing requirements of qualified foreign stock exchanges[8] and make their home country disclosure available in English. There are also a significant number of U.S.-based issuers who are current in their reporting to regulators[9] such as the U.S. Securities and Exchange Commission (SEC) or make available ongoing quarterly and audited annual financial reports through OTC Markets Group. Many companies in the Pink market tier of the OTC categorization system do not meet the United States' listing requirements for trading on a stock exchange such as the New York Stock Exchange or NASDAQ. Many of these issuers do not file periodic reports or make available audited financial statements, making it very difficult for investors to find reliable, unbiased information about those companies. For these reasons the SEC views many of the lower-tier companies traded on OTC Markets as "among the most risky investments" and advises potential investors to heavily research the companies in which they plan to invest.[10]

Securities trading on the OTCQB and higher-tiered OTCQX trading marketplaces have status of Blue Sky secondary trading exemptions in 33 states and brokers may recommend such securities to their clients like securities listed on national stock exchanges.[11]

Markets

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OTC Markets Group designates securities in one of three markets to indicate the level of financial and corporate disclosure provided by the companies using its quotation system. Apart from the OTCQX market, which has rules that include financial requirements, the designations do not signify issuer quality or merit of any security. Designation is based on the level and timeliness of a company's disclosure and OTCQB and any of the Pink categories can include both high quality as well as speculative, distressed, or questionable companies. Strict promotion policies have been enacted to flag these companies and deny their application for trading if they engage actively in campaigns marked by misleading information or manipulative promotions.[12]

The OTCQX and OTCQB markets are considered 'Established Public Markets' by the SEC for the purpose of determining the public market price when registering securities for resale with the SEC in equity line financings.[13] OTC Markets Group can facilitate electronic trading with its SEC-registered Alternative Trading System known as OTC Link ATS.[14]

OTCQX

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The OTCQX market includes both multinational companies seeking access to U.S. investors, and domestic growth companies.[15] To be traded on this tier, companies must undergo a qualitative review by OTC Markets Group. Companies are not required to be registered with or reporting to the SEC, but they must post financial information with OTC Markets Group. In addition, U.S. companies must be ongoing operations (i.e., no shells) and may not be in bankruptcy, while foreign issuers must meet the requirements of qualified foreign exchanges. Additional oversight of OTCQX securities is provided by requiring every issuer to be sponsored by approved third-party investment banks or law firms, called OTCQX Sponsors.[16][17]

As of October 18, 2023, 658 securities were available for trading on the OTCQX exchange, 478 of these being international companies and 180 of these being U.S. companies.[18]

OTCQB

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The OTCQB market contains a one penny ($0.01) bid price requirement "intended to remove companies that are most likely to be the subject of dilutive stock fraud schemes and promotions". Each company verifies via an annual OTCQB Certification, signed by the company CEO or CFO, that their company information is current, including information about a company's reporting status, company profile, information on management and boards, major shareholders, law firms, transfer agents, and IR / PR firms. Investor confidence improves when there is more information about a company's ownership structure, professional advisors and service providers. This certification will be required for any security newly qualified to be publicly quoted by a broker-dealer under SEC Rule 15c2-11, or when a Pink traded company becomes a current SEC reporting company, beginning May 1, 2014. International Reporting companies are also allowed to upgrade from Pink to OTCQB if they publish their 12g3-2(b) compliant disclosure online and verify their company profile. There is an annual fee for the OTCQB market of $12,000 per year and a one-time $2,500 application fee.[19]

As of October 18, 2023, 1,216 securities were available for trading on the OTCQB exchange.[18]

OTC QX/QB Blue Sky Status

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As of November 2018, the OTCQX Market has Blue Sky status in 33 states and the OTCQB Market in 30 states. Blue sky laws are state regulations established as safeguards for investors against securities fraud. The laws, which may vary by state, typically require sellers of new issues to register their offerings and provide financial details. This allows investors to base their judgments on verifiable information. Since the SEC recognized OTCQX and OTCQB as established public markets, OTC Markets Group has worked collaboratively with state regulators since the 2014 JOBS ACT to apprise them of the easily accessible, free, public online disclosure of current information provided by companies traded on the OTCQX and OTCQB premium markets. As of April 2018, 60% of the 50 states now acknowledge the OTCQX Market for the purposes of secondary trading exemptions. The investor protection and quality control standards of the OTCQX and OTCQB therefore are of Status to meet or exceed the Blue Sky standards of the respective states.[20][21]

Pink

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Pink is an open market that has low financial standards or reporting requirements. The stock of companies in the Pink tier are not required to be registered with the SEC. Companies in this category are further categorized by the level and timeliness of information they provide to investors and may have current or limited public disclosure.[22] These were both glamorized and denigrated in the film The Wolf of Wall Street.

Pink Current

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Companies submitting regular Quarterly and Annual Reports go into the Current category. This category can still include shell companies or development stage companies with little or no operations as well as companies without audited financial statements. Companies in this category must not only have Quarterly reports duly posted every three months, but most have Annual reports for at least the preceding two years on file.[23]

As of October 18, 2023, there were 6,705 securities under Pink Current.[18]

Pink Limited

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Companies that have submitted information no older than six months to the OTC Markets data and news service or have made a filing on the SEC's EDGAR system in the previous six months are rated as having limited information. Companies that are unwilling or unable to meet OTC Markets' Guidelines for Providing Adequate Current Information with Quarterly and Annual Reports every three months, but which still submit information at least every six months, are in this category. These are often companies with financial reporting problems, economic distress, or in bankruptcy.

As of October 18, 2023, there were 3,684 securities under Pink Limited.[18]

Expert Market

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This market indicates companies that are unwilling or unable to provide disclosure to the public markets. Companies in this category do not make current information available via OTC Markets disclosure and news service, or if they do, the available information is older than six months. This category includes defunct companies that have ceased operations as well as "dark" companies with questionable management and market disclosure practices. Securities of publicly traded companies that are not willing to provide information to investors are considered highly risky. Quotations for stocks in this tier are hidden from the public. This tier was formerly known as the Pink No Information tier.

As of October 18, 2023, there were 3,342 securities in the Expert Market.[18]

Caveat Emptor

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There is a public interest concern associated with the company designated as "Caveat Emptor" (Latin for "buyer beware"). This may include a spam campaign, stock promotion or known investigation of fraudulent activity committed by the company or through inside information. During a spam campaign, any stock that is not in the Current Information category will also have its quotes blocked on otcmarkets.com.

Quotation eligibility

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The SEC requires broker-dealers to comply with Exchange Act Rule 15c2-11 before displaying quotes on OTC securities,[24] and requires submission of Form 211 to the FINRA OTC Compliance Unit.[25] In 2019, amendments were proposed to 15c2-11, which had not been significantly amended since 1991.[24]

FINRA Rule 6500[26] contains rules on quoting OTC securities on the OTCBB, but the OTCBB has diminished in importance and by 2016 less than 2% of OTC trades occurred on the OTCBB, as opposed to OTC Markets.[27] In 2014, FINRA proposed to remove Rule 6500 and eliminate the OTCBB, but withdrew the rule and in 2016 proposed to update the OTCBB to provide a backup system in case quotation is disrupted or nonexistent.[27]

Other FINRA rules such as Rule 6432 and Rule 5250 relate to the SEC Rule 15c2-11; for example, Rule 5250 prohibits market makers from receiving compensation from issuers.[28]

Risks and regulation

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Many of the stocks traded OTC are microcap stocks, also known as penny stocks, which are known for fraudulent microcap stock fraud and penny stock scams.[29]

After the passage of Sarbanes-Oxley Act in 2002, some companies delisted and became OTC to save costs and avoid certain regulations, although OTC companies have faced pressure to improve disclosure.[30]

Other OTC markets

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Main article: Over-the-counter (finance)

OTCBB

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The OTC Bulletin Board (OTCBB) was only a listing of securities that are also traded "over the counter" similar to the OTC Markets. The OTCBB has diminished in importance, with very little activity, but was previously retained as possible last resort system in case of disruption.[27] OTCBB companies were required to file timely reports to a U.S. regulatory agency. Almost all OTCBB companies are now quoted via OTC Markets' OTC Link ATS because its fully electronic trading platform better meets the needs of automated broker-dealers. The OTCBB was shut down on November 8, 2021.[31]

Grey market

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Securities that are not listed on any stock exchange nor formally quoted on OTC Markets or OTCBB are considered to be in the grey market. Unsolicited transactions are processed independently and not centrally listed or quoted. Trades are reported to a self-regulatory organization (SRO), which then passes the data on to market data companies. The grey market is also called OTOTC or Other OTC.[32]

[33]

As of October 18, 2023, there were 1,426 securities in the grey market.[18]

Compliance Data Products

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Compliance Analytics

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The Compliance Analytics Product creates a security specific risk score for all OTCQX, OTCQB, Pink and Grey securities. Risk is assessed over 19 parameters including caveat emptor, shell status, penny stock status, price/volume changes and stock promotion data. Recently, the product integrated "Hot Sector" information about cannabis, cryptocurrency and blockchain.[34]

Promotion Data

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The Promotion Data Product provides market professionals and investors with active and historical promotion data for OTCQX, OTCQB, Pink and Grey securities.[35]

Index products

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The company calculates and licenses indices of securities that trade on one of the top two market tiers, including the OTCM QX ADR 30 Index of OTCQX-traded American depository receipts

References

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[edit]
Revisions and contributorsEdit on WikipediaRead on Wikipedia

OTC Markets Group

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from Grokipedia
OTC Markets Group Inc. is an American company that operates regulated markets for the trading of over-the-counter (OTC) securities, providing price, , and disclosure information for approximately 12,000 U.S. and international securities. Headquartered in , the company organizes these securities into tiered markets based on data-driven disclosure standards to promote transparency and efficiency in trading. Its primary markets include the OTCQX Best Market for established, investor-focused companies; the OTCQB Venture Market for early-stage and developing enterprises; the OTCID Basic Market, launched in July 2025 for companies providing baseline disclosure; and the Pink Market, including subcategories like the Pink Limited Market, for a broader range of issuers with varying or limited reporting requirements. Tracing its origins to the National Quotation Bureau established in , OTC Markets Group has evolved into a key provider of market infrastructure for non-exchange-traded securities, with modern operations beginning in the late through acquisitions and technological advancements. The company went public in 2009 and trades on its own OTCQX market under the OTCM. Today, it serves broker-dealers, investors, and issuers by facilitating decentralized trading via its wholly owned subsidiary, OTC Link LLC, a FINRA-registered alternative trading system (ATS). OTC Markets Group's operations are divided into three main business segments: OTC Link, which handles quotation, order routing, and execution services for inter-dealer trading; Market Data Licensing, offering real-time, historical, and analytical data products to financial professionals; and , providing disclosure and compliance tools to help companies meet market standards. These services support a diverse , including international companies seeking U.S. , and emphasize investor protection through enhanced reporting and news dissemination. As of 2025, the firm continues to innovate in digital disclosure and data analytics, maintaining its role as a cornerstone of the U.S. OTC equities landscape.

History

Founding and Early Development

Tracing its origins to 1904 with the publication of pink sheets, the National Quotation Bureau (NQB) was formally established in 1913 by financial book publisher Arthur F. Elliot and financier Roger Ward Babson as a service to compile and publish daily price quotations for over-the-counter (OTC) securities, initially in a printed format on pink paper that became known as the "pink sheets," which were distributed to subscribing brokers and dealers across the United States. This manual publication filled a critical gap for unlisted securities not traded on formal exchanges like the New York Stock Exchange, providing inter-dealer bid and ask quotes to facilitate OTC trading. The pink color was chosen to distinguish these OTC quotes from the white paper used for exchange-listed securities, establishing the NQB as the primary information hub for the decentralized OTC market. In its early years, the NQB's operations centered on labor-intensive processes where securities dealers submitted quotes via or mail, which were then compiled and printed daily for distribution. As the post-World War I economic expansion fueled growth in smaller companies and unlisted stocks during the , the service expanded to cover an increasing volume of securities, reflecting the burgeoning OTC market that handled trades for thousands of issues amid rising investor interest in speculative opportunities. The NQB's role became indispensable for market makers negotiating prices off-exchange, supporting in a fragmented trading environment without centralized clearing. The Wall Street Crash of 1929 and the ensuing dramatically curtailed trading volumes across all markets, including OTC, prompting widespread calls for reform to restore investor confidence. The , enacted in response, mandated registration and disclosure for securities offered to the public, formalizing OTC trading practices by imposing standards on issuers while exempting certain private placements; however, it did not initially extend direct to quotation services like the NQB, allowing the bureau to continue operating as an independent publisher. This regulatory framework stabilized the broader securities landscape but left OTC quotes reliant on the NQB's voluntary compilation amid ongoing economic recovery efforts. From the 1930s through the 1950s, the NQB solidified its position as the leading provider of OTC securities information, adapting to technological advancements in communication to enhance efficiency. By the mid-20th century, the introduction of teletype services enabled faster dissemination of quotes beyond daily print runs, allowing real-time updates via telegraph printers to subscribers and reducing reliance on mailed sheets during a period of gradual market modernization. This evolution maintained the NQB's centrality in OTC trading while paving the way for later electronic transitions.

Key Milestones and Rebranding

In the late 1990s, the National Quotation Bureau (NQB), the predecessor to , began transitioning from traditional printed pink sheets to electronic quotation services, culminating in the launch of a real-time Electronic Quotation Service in September 1999. This shift marked a significant technological advancement, enabling faster dissemination of over-the-counter (OTC) security prices to broker-dealers and laying the groundwork for modern digital trading platforms. In 1997, R. Cromwell Coulson led a group of investors to acquire the NQB, initiating a period of modernization and expansion for the OTC market infrastructure. The company restructured in July 2000, changing its name to Pink Sheets LLC to reflect its evolving electronic focus. Further acquisitions and mergers in the early strengthened its position, including integrations that enhanced data services and market connectivity. By March 2008, Pink Sheets LLC converted to a corporation and adopted the name Pink OTC Markets Inc., emphasizing its role in OTC trading. In November 2010, shareholders approved a to OTC Markets Group Inc., aligning the name with its broader market operations and regulatory status. A pivotal development occurred in with the launch of the OTCQX market tier in , designed for established, high-quality international and U.S. securities meeting stringent financial and disclosure standards, which attracted global issuers seeking transparent U.S. trading venues. This was followed in April 2010 by the introduction of the OTCQB Venture Market for early-stage and developing companies, providing a middle tier with reporting requirements to enhance investor access. Concurrently, the Pink sheets were restructured into a more organized open market segment, completing the tiered framework that improved market quality and segmentation. Regulatory milestones bolstered the company's credibility, including the SEC's approval in 2010 for OTC Link LLC—formerly Pink Link ATS—to operate as an alternative trading system (ATS), subjecting it to direct oversight by the SEC and FINRA and facilitating attributable, network-based quoting and execution. The company went public in 2014, trading on its own OTCQX market under the OTCM, demonstrating its adherence to its own premium standards. In July 2025, the company launched the OTCID Basic Market, replacing the Pink Current tier and introducing a new framework for basic disclosure and transparency in the lowest OTC segment, further evolving its branding toward issuer engagement and market efficiency. Financially, OTC Markets Group achieved notable growth in recent years, reporting gross revenues of $30.5 million for the second quarter of 2025, an 11% increase year-over-year, primarily driven by expanded licensing to financial institutions and vendors. This performance underscored the company's resilience and the increasing value of its data-driven services amid rising global OTC trading volumes exceeding hundreds of billions annually.

Markets and Tiers

OTCQX Market

The OTCQX Best Market serves as the premier tier within OTC Markets Group, designed for established U.S. and international companies that meet stringent financial standards, robust corporate governance practices, and ongoing disclosure requirements to provide transparency for investors. This market hosts 553 securities as of September 30, 2025, attracting investor-focused firms seeking enhanced credibility without the full regulatory burdens of major exchanges. To qualify for trading on the OTCQX, companies must satisfy specific eligibility criteria, including a minimum bid of $0.25 per share maintained for at least 30 consecutive trading days prior to admission and a global of at least $10 million over the same period. Alternative financial thresholds include average revenue of at least $6 million over the preceding three fiscal years or net tangible assets of $2 million (if in operation for three or more years) or $5 million (if less than three years). U.S. companies are required to be current in SEC filings or equivalent reporting under Regulation A, while international firms must provide home-country disclosures in English that are substantially equivalent to SEC standards, often via exemptions like Rule 12g3-2(b). Governance mandates include at least two independent directors, a majority-independent , annual meetings, and distribution of proxy materials. Companies must also undergo annual certification of compliance and verify their OTCIQ profile every six months to maintain listing. Participation in the OTCQX offers significant benefits, including increased visibility to a broad base of U.S. institutional investors, family offices, and retail traders through quotation in U.S. dollars during standard trading hours. The market's standards facilitate access to capital without mandatory SEC registration or Sarbanes-Oxley compliance, positioning it as a cost-effective alternative for mature companies. A key highlight is the annual OTCQX Best 50 ranking, which recognizes top performers based on total return and dollar volume growth; the 2025 list featured companies with a median total return of 74% in 2024. In 2024, the OTCQX Best 50 companies collectively generated $5.85 billion in total trading volume, underscoring the market's for high-performing securities. Representative examples include Luca Mining Corp., which ranked fifth on the 2025 OTCQX Best 50 for its strong performance in the mining sector.

OTCQB Venture Market

The OTCQB Venture Market serves as a mid-tier platform within OTC Markets Group, tailored for entrepreneurial and development-stage U.S. and international companies, including startups and global firms seeking to enhance visibility and liquidity while meeting growth-oriented disclosure standards. As of September 30, 2025, the market hosts 1,097 companies, providing a structured environment for early-stage ventures to access U.S. investors through real-time quotes and verified information. This tier emphasizes transparency via audited financials and regular reporting, distinguishing it from lower-disclosure markets while imposing lighter financial thresholds than higher tiers like the OTCQX. Eligibility for the OTCQB requires companies to maintain a minimum bid price of $0.01 per share, a current of at least 10% of total , and at least 50 beneficial shareholders each holding a minimum of 100 shares. Applicants must provide audited annual prepared in accordance with U.S. or IFRS by a PCAOB-registered for U.S. companies or an equivalent for international firms, along with quarterly reporting equivalent to SEC Forms 10-Q or 10-K, or adherence to alternative reporting standards such as Regulation A or reporting. Additionally, companies undergo annual OTCQB signed by the CEO or , confirming compliance with ongoing obligations, including prompt disclosure of via the OTC Disclosure & News Service, and basic features like at least two independent directors and an with a majority of independent members. Companies in or with shell status are ineligible. A key benefit for OTCQB issuers is the Blue Sky exemption, which, as of July 1, 2025, applies in 37 U.S. states and jurisdictions, allowing qualified securities to be traded secondarily without state-level registration under blue sky laws and reducing compliance burdens for broker-dealers and investors. This status promotes broader accessibility for venture-stage companies by streamlining resale processes while upholding federal securities regulations. The OTCQB actively supports market growth through monthly influxes of new listings, such as in September 2025, when companies like BioNxt Solutions Inc. (up-listing under symbol BNXTF), Pacifica Silver Corp. (PAGFF), and Hamak Gold Limited joined, highlighting sectors like biosciences, , and . These additions underscore the market's role in fostering transparency to attract , with OTC Markets Group issuing regular announcements to spotlight emerging opportunities and build investor confidence.

Pink Open Market

The Pink Open Market serves as the most accessible and least regulated tier within OTC Markets Group, accommodating a diverse array of approximately 9,500 securities as of September 30, 2025, that do not qualify for or choose not to participate in higher tiers such as OTCQX, OTCQB, or OTCID. This market includes a wide range of issuers, notably foreign companies trading American Depositary Receipts (ADRs) or ordinary shares, as well as domestic entities like penny stocks, distressed businesses, and shell companies, all without any minimum financial standards or quantitative listing requirements. As of July 1, 2025, the Open Market's structure was updated following the elimination of the former Current subcategory and its replacement by the separate OTCID Basic Market tier (which hosts 1,077 companies as of September 30, 2025), leaving the Open Market to encompass two primary subcategories based on disclosure levels: Limited and No Information. In the Limited subcategory, issuers provide limited information through biennial reports or alternative public disclosures, such as confirmations of ongoing exchange listings outside the U.S. or basic operational updates, allowing broker-dealers to quote securities with minimal issuer certification. The No Information subcategory includes securities where issuers provide no required ongoing disclosures, relying solely on any available public data from external sources, which further emphasizes the market's open nature but heightens the need for investor caution. Issuers in the Pink Open Market benefit from a 15-day before any downgrade to a lower subcategory or restricted status if they fail to maintain required disclosure standards, providing a brief window to regain compliance. During this transition, OTC Markets Group notifies broker-dealers and highlights the importance of investor , as the lack of standardized reporting can obscure risks. Investors are strongly encouraged to independently verify through regulatory filings or third-party sources, given the market's variable transparency. The Pink Open Market exhibits significant trading volume, often driven by speculative interest in low-priced securities, yet it carries elevated risks due to limited oversight and disclosure variability. Historical issues with penny stocks in this tier have included instances of , such as pump-and-dump schemes and manipulated reporting, where insufficient information enables misinformation to proliferate among retail investors. Regulatory bodies like the SEC and FINRA have repeatedly warned of these vulnerabilities, underscoring the potential for substantial losses in this high-speculation environment.

Specialized Markets

The Specialized Markets of OTC Markets Group encompass niche venues designed for handling restricted or high-risk securities that fall outside the standard quotation tiers, providing targeted trading and warning mechanisms for broker-dealers and investors. These include the Expert Market, a private platform exclusively for qualified broker-dealers, and the designation, which flags securities warranting caution due to significant concerns. These specialized features enhance transparency and in the over-the-counter environment by isolating problematic or restricted trading activity from public markets. The Expert Market serves as a dedicated tier for trading SEC-restricted securities, such as those owned by company insiders, affiliates, or entities subject to blackout periods under Rule 144, where public quoting is prohibited. Accessible only to broker-dealers subscribed to OTC Link ATS, it enables the publication of unsolicited bona fide quotes representing customer limit orders in "No Information" securities—those lacking adequate public disclosure or failing to comply with SEC Rule 15c2-11 requirements. This private venue supports best execution needs without disseminating quotes to the broader public, thereby maintaining regulatory compliance for restricted transactions. The majority of securities in the Expert Market shifted there due to non-compliance with ongoing reporting obligations following amendments to Rule 15c2-11. Caveat Emptor, Latin for "buyer beware," is a prominent warning designation applied to OTC securities exhibiting concerns, including severe disclosure deficiencies, regulatory trading suspensions, , or manipulative activities like pump-and-dump schemes. OTC Markets Group updates this list monthly based on monitoring and alerts from the SEC and FINRA, affixing a icon to affected stock symbols on its platform to signal heightened risks and prompt broker-dealers to impose internal trading restrictions. Examples include recent designations for securities such as BMPA (BioMicrobics, Inc., added October 2025) due to compliance issues. In practice, Caveat Emptor affects a minimal portion of overall market volume—approximately 0.09%—yet serves as a critical tool for investor protection by deterring engagement with delisted or fraudulent offerings.

Eligibility and Standards

Quotation and Listing Requirements

To obtain and maintain quotations on OTC Markets Group's platforms, broker-dealers must follow a structured process governed by SEC Rule 15c2-11 and FINRA Rule 6432. Specifically, a broker-dealer intending to initiate or resume publishing quotations for an OTC security must file Form 211 with FINRA, which requires detailed issuer information including business descriptions, , and details on officers, directors, and significant shareholders. The filing also mandates that the issuer is not subject to bad actor disqualifications under Rule 506(d) of Regulation D that would preclude quotation eligibility, ensuring no disqualifying events such as certain criminal convictions or regulatory sanctions affect key personnel or the issuer. Upon FINRA approval, the broker-dealer may publish the initial quotation, typically within three business days, subject to ongoing compliance with public information requirements. Across OTC Markets tiers, minimum standards ensure orderly and . Companies must pay annual fees ranging from $16,020 for the OTCQB tier to $26,100 for the OTCQX tier, with no mandatory annual fee for the basic but optional services like OTCID costing $7,500. Quotations require maintenance of bid and ask prices by at least one for OTCQB and tiers, increasing to two for OTCQX to support , with all tiers relying on priced quotes published via the OTC Link ATS. Additionally, current public information must be readily available, including recent financial reports and material disclosures accessible through for SEC-reporting companies or the OTC Disclosure & Service for others, as verified under Rule 15c2-11. Tier upgrades and downgrades occur automatically based on compliance with these standards, promoting transparency and . For instance, failure to file required reports results in a downgrade to the Pink Limited tier, where are restricted; companies receive cure periods—typically 15 to 45 days depending on the deficiency—to restore compliance before the change takes effect. Successful upgrades, such as from OTCQB to OTCQX, require meeting higher financial and thresholds alongside sustained quotation activity. For non-U.S. firms seeking eligibility on OTCQX or OTCQB, a process applies through an approved OTCQX or OTCQB Sponsor, typically a qualified , , or , which provides a letter of introduction verifying compliance with home-country standards and U.S. securities laws. This sponsorship ensures equivalent regulatory oversight, allowing international securities to qualify without full SEC registration while maintaining quotation integrity.

Compliance and Reporting Obligations

Issuers on the OTC Markets Group's platforms are subject to tier-specific reporting obligations designed to ensure ongoing transparency and disclosure. For the OTCQX and OTCQB markets, companies must provide SEC-equivalent filings, either through the U.S. Securities and Exchange Commission's system for reporting companies or via the Alternative Reporting Standard, which requires uploading quarterly reports within 45 days of the fiscal quarter-end and annual reports within 90 days of the fiscal year-end to OTCIQ.com. These reports include audited prepared in accordance with U.S. or IFRS, management's discussion and analysis, and certifications of compliance. In July 2025, OTC Markets Group launched the OTCID Basic Market, replacing the former Current tier, with enhanced basic disclosure requirements. The OTCID tier mandates quarterly reports within 45 days and annual reports within 90 days, along with current event disclosures for material changes. The Limited tier requires less frequent disclosure, with annual reports covering the fiscal year ended no more than 16 months prior to quotation publication and updates to the Company Verified Profile on OTCIQ.com at least every 12 months. Annual verification processes reinforce these obligations through third-party and certifications. On the OTCQX and OTCQB, annual must be audited by an independent public accountant, with details of the auditor's qualifications provided in the reports; standards also require annual management certifications attesting to compliance with qualitative criteria, such as no proceedings and minimum bid price thresholds. For OTCID, issuers complete an annual Management Certification and maintain a verified profile, while Pink Limited companies face no mandatory audit but must ensure basic profile updates. Non-compliance with these verification requirements triggers a 15-day , after which issuers may face delisting from their current tier or transfer to the Expert Market, where trading is restricted. Compliance with these reporting standards facilitates exemptions under the National Securities Markets Improvement Act (NSMIA) for Blue Sky laws in multiple states. Securities quoted on the OTCQX qualify for exemptions in 41 U.S. jurisdictions, while those on the OTCQB are exempt in 37, allowing broker-dealers to recommend and sell these securities interstate without additional state registrations or merit reviews in those areas. This streamlined process reduces administrative burdens for issuers and supports broader secondary trading liquidity. OTC Markets Group enforces these obligations through a dedicated issuer compliance department that utilizes automated monitoring systems to track filing deadlines and disclosure quality across all tiers. Upon detecting lapses, such as untimely quarterly or annual reports, the platform issues compliance notifications and warnings to s, potentially leading to tier downgrades if unresolved; for example, failure to maintain current status on OTCQX or OTCQB results in removal to lower tiers like Pink Limited or the Expert Market. These mechanisms ensure proactive oversight without direct regulatory authority, focusing on maintaining market integrity through consistent enforcement.

Regulation and Oversight

Regulatory Framework

OTC Markets Group's operations are primarily governed by the U.S. Securities and Exchange Commission (SEC) and the . OTC Link, the facilitating trading on OTC Markets, has operated as an SEC-registered Alternative Trading System (ATS) since 2012, subjecting it to direct oversight by the SEC for compliance with securities laws and regulations. Additionally, as a FINRA member , OTC Link is regulated by FINRA, which oversees activities, including the publication and submission of quotations in OTC securities under Rule 15c2-11 of the Securities Exchange Act of 1934. This rule mandates that broker-dealers review and maintain specified public information about issuers before initiating or resuming quotations in non-exchange markets, aiming to promote transparency and prevent fraud. Key foundational regulations stem from the , which establishes the framework for OTC trading by requiring the availability of current public information for securities quoted in interdealer quotation systems. The Jumpstart Our Business Startups (JOBS) Act of 2012 further influenced the regulatory landscape by introducing scaled reporting requirements for emerging growth companies (EGCs), allowing those with annual gross revenues under $1.235 billion to provide reduced disclosures for up to five years after an , thereby facilitating access to OTC markets for smaller issuers. While OTC Markets Group enforces its own tier-specific standards for issuer eligibility and disclosure, it does not function as a (SRO) and defers primary enforcement of securities laws and broker-dealer rules to the SEC and FINRA, including investigations into violations such as . The SEC adopted climate-related disclosure rules in 2024 requiring reporting on material climate risks and in annual filings for SEC-reporting companies such as OTCQX issuers. However, on March 27, 2025, the SEC voted to end its defense of these rules amid ongoing legal challenges, effectively suspending their implementation as of November 2025.

Risks to Investors

Investing in securities traded on OTC Markets Group platforms carries several inherent risks, primarily due to the decentralized nature of over-the-counter trading. Low liquidity is a key concern, as many OTC securities have limited trading volume, making it difficult for investors to enter or exit positions without significantly impacting prices. This illiquidity can exacerbate losses during market downturns or when selling shares. High volatility is another prevalent risk, with prices often fluctuating sharply due to sparse trading and sensitivity to news or promotions, particularly in smaller market capitalizations. Additionally, counterparty default risk exists, where the other party in a trade may fail to fulfill obligations, though this is mitigated somewhat by clearing mechanisms but remains higher than on centralized exchanges. Risk levels vary significantly across OTC Markets Group's tiers, influencing investor exposure. The OTCQX tier imposes stringent financial and standards, including audited reporting, which helps minimize risks by ensuring greater transparency and eligibility for established companies. In contrast, the OTCQB Venture Market targets early-stage firms with moderate requirements, offering some protections but still exposing investors to higher volatility from developmental uncertainties. The Pink Open Market amplifies risks the most, as it includes companies with no minimum reporting obligations, leading to limited disclosure and heightened potential for such as pump-and-dump schemes where promoters artificially inflate prices before selling. Within the Pink tier, the designation flags securities with public interest concerns, like suspected spam campaigns or regulatory issues, signaling severe risks to buyers. To mitigate these dangers, OTC Markets Group provides several investor protections. Its real-time disclosure platform, including the OTC Disclosure & News Service and the 2025-launched OTC Disclosure , enables access to current company filings and updates, promoting transparency across tiers. Investor education resources on the platform highlight red flags and best practices. Furthermore, the 2020 amendments to SEC Rule 15c2-11, effective September 2021, require broker-dealers to review and confirm current public information before quoting Pink securities, reducing the ease of trading undisclosed or fraudulent stocks. Historical incidents underscore these risks, particularly in the microcap segment during the 2020s. For instance, in 2022, the SEC charged 18 individuals and entities in a microcap pump-and-dump scheme involving hacked U.S. brokerage accounts to promote , defrauding investors of millions. Other cases, such as COVID-19-related false promotions in , generated over $25 million from illegal sales of OTC microcaps. OTC Markets Group addresses non-compliance through ongoing monitoring, delisting numerous securities annually for violations like inadequate reporting or indicators, as tracked in its compliance statistics.

Products and Services

Market Data and Analytics

OTC Markets Group offers a suite of products covering over 12,000 U.S. and international securities traded on its platforms, including real-time quotes, , and reference information delivered through APIs and multicast feeds. These offerings provide comprehensive coverage of OTCQX, OTCQB, OTCID, and markets, encompassing last sale prices, best bid and offer , historical trades, and security master details such as company profiles and financial identifiers. The is licensed primarily to broker-dealers, trading platforms, and financial institutions for integration into their systems, enabling efficient access to liquidity and pricing for over-the-counter securities. A key component of these products is Compliance Analytics, a specialized tool designed for broker-dealers to assess and automate compliance with SEC Rule 15c2-11, which governs the publication of quotations for OTC securities. This service includes automated checks on issuer disclosures, such as verifying current public information, tracking changes in authorized , and evaluating price and volume anomalies against 30-day moving averages. It also incorporates risk scoring across 23 categories, flagging potential issues like shell company status or prior regulatory caveats to support and reduce quotation risks. In addition, OTC Markets Group provides promotion monitoring data to identify and mitigate manipulative activities, particularly in the Pink market where disclosure requirements are minimal. This includes tracking issuer promotions through a dedicated compliance team that scans for anonymous paid promotions, excessive hype, and patterns indicative of stock manipulation, issuing alerts via a promotion icon on affected securities. The tool helps broker-dealers enhance anti-money laundering processes and investor protections by providing real-time flags for potentially fraudulent activities. Data licensing remains a significant revenue driver for OTC Markets Group, with revenues from this segment increasing 14% in the second quarter of 2025 compared to the prior year, reflecting growth in subscriber bases and pricing adjustments. Notable clients include major platforms such as Bloomberg and Charles Schwab, which integrate OTC data for retail and institutional trading.

Index and Corporate Solutions

OTC Markets Group offers a suite of index products designed to track the performance of securities across its market tiers, providing benchmarks for investors and facilitating performance measurement. The OTCQX Composite Index (.OTCQX) serves as a primary benchmark for the OTCQX Best Market, encompassing all qualifying OTCQX-listed companies and reflecting their overall market performance; in Q2 2025, it rose 10.3%, with 43 new companies added to the index. These indices enable investors to gauge tier-specific trends and support applications such as exchange-traded funds () and broader , though direct ETF tracking remains limited to select benchmarks. Additionally, OTC Markets Group maintains sector-specific indices, such as the OTCQX Banks Index for financial institutions, allowing customized tracking of industry performance akin to or other specialized areas. Complementing its indices, OTC Markets Group provides corporate solutions that assist issuers with compliance, disclosure, and , enhancing market access and transparency. Key offerings include the OTC Disclosure & News Service, a platform for disseminating financial reports, press releases, and regulatory filings as an alternative to traditional submissions, which supports current information requirements for , OTCQB, and OTCQX markets. (IR) tools, such as real-time Level 2 quote data, enable companies to monitor liquidity and engage stakeholders effectively. For upgrades and ongoing compliance, Blue Sky Solutions streamline state securities law adherence across jurisdictions, while annual processes—requiring verification of company profiles and disclosures through OTCIQ—help maintain eligibility in higher tiers like OTCQX and OTCQB. These services collectively aid issuers in navigating U.S. federal and state regulations, with features tailored to support transitions between market tiers. In 2025, OTC Markets Group continued to emphasize these offerings through initiatives like the annual OTCQX Best 50 , which highlights top-performing OTCQX companies based on total return and trading ; the 2025 list featured firms that achieved a 74% return in 2024 and collectively traded $5.85 billion in . Corporate services generated $11.7 million in Q2 2025 revenues, representing approximately 38% of total gross of $30.5 million and marking a 3% year-over-year increase driven by pricing adjustments and growth in disclosure subscriptions, despite a 5% decline in unique Pink market subscribers to 1,362 amid broader market contraction. This segment's performance underscores its role in stabilizing streams, even as subscriber counts in OTCQX (down 2% to 556) and OTCQB (down 1% to 1,073) faced modest pressures from economic headwinds.

OTC Bulletin Board

The (OTCBB) was a FINRA-operated inter-dealer system that provided real-time quotes for over-the-counter (OTC) equity securities not listed on a national securities exchange or . Launched in June 1990 as a one-year pilot approved by the Securities and Exchange Commission (SEC), it marked the first electronic system for disseminating OTC quotations among broker-dealers. Eligible securities included those from delisted companies and certain market issues, but only if issuers maintained current reporting with the SEC or equivalent regulatory authorities, such as filing periodic financial reports via the SEC's database. The system did not facilitate trade execution, focusing solely on display, and operated without any affiliation to OTC Markets Group platforms. Historically, the OTCBB played a significant role in modernizing OTC trading by replacing manual quotation methods with electronic dissemination, peaking in usage during the and early . However, its prominence waned starting in the mid- as many eligible securities migrated to tiered OTC Markets platforms like OTCQB and , driven by enhanced disclosure standards and services offered by OTC Markets Group. By the , the OTCBB's role had significantly diminished, reflecting broker-dealers' shift to alternative inter-dealer systems. Prior to closure, it quoted a limited number of securities, including delistees and Pink-quoted issues. As of 2025, the OTCBB remains retired following FINRA's cessation of operations on November 8, 2021, with no ongoing usage or data feeds available. The closure aligned with the adoption of FINRA Rule 6439, which regulates private inter-dealer quotation systems and eliminated the need for the legacy OTCBB infrastructure. Most former OTCBB-eligible securities transitioned to OTCQB or markets, where they benefit from tiered standards unavailable on the free-to-use OTCBB; following the closure, trading volume in OTC Markets Group's platforms increased as broker-dealers consolidated on regulated ATS like OTC Link. Unlike OTC Markets Group's offerings, the OTCBB lacked proprietary data products, analytics, or graduated disclosure tiers, positioning it as a basic, no-cost quotation venue for brokers. In contrast to trading, which involves unregulated, informal quotations outside any formal system, the OTCBB provided a structured, FINRA-supervised environment for reported securities.

Grey Market Trading

Grey market trading encompasses informal over-the-counter (OTC) transactions in securities that lack public quotations in any interdealer quotation system, such as those operated by or the legacy . These trades occur through direct broker-to-broker negotiations, without centralized pricing or mandatory public disclosure of quotes, distinguishing them from the more structured tiers like Pink sheets. Securities commonly involved include pre-IPO shares, restricted foreign stocks ineligible for quoting due to regulatory hurdles, unsponsored American Depositary Receipts (ADRs) for international firms, and equities of bankrupt or delisted companies where broker-dealers cite insufficient information or investor interest as reasons for non-quotation. While activity represents a minimal fraction of overall OTC trading volume—significantly lower than quoted markets— it facilitates for otherwise inaccessible assets. For instance, trades in ADRs of foreign entities awaiting U.S. listing or securities from firms in proceedings are executed sporadically via these private arrangements. Although individual trades must be reported to the (FINRA) for surveillance purposes, the data is not disseminated publicly, preserving the opacity of pricing and execution details. This segment of OTC trading carries elevated risks compared to the Pink market tier, including pronounced illiquidity from sparse transaction activity and pricing opacity due to negotiated, non-transparent terms that can lead to wide bid-ask spreads or unfulfilled deals. The U.S. Securities and Exchange Commission (SEC) oversees these activities indirectly through FINRA's trade reporting requirements and anti-manipulation rules, but the absence of a formal quotation tier or ongoing disclosure mandates heightens vulnerability to or abusive practices.

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