Coinsilium, the blockchain venture builder and investor that finances and manages the development of early-stage blockchain technology companies, is pleased to announce its unaudited consolidated interim financial statements for the six months ended 30 June 2017.
Financial Summary
- Total Comprehensive Income* of £290,210 (H1 2016: loss of £258,533)
- Loss for the period from continuing operations reduced by 24% to £205,378, (H1 2016: loss of £269,756)
- Loss per share of£0.02 (H1 2016: loss per share of £0.04)
- Available for sale financial assets amounted to £1.6m at 30 June 2017 (31 December 2016: £1.1m)
- Successful fundraising totaling £555,985 in three tranches between March and June 2017
- As at 30 June 2017, cash and cash equivalents amounted to £343,908 (31 December 2016: £99,641)
* Total Comprehensive Income includes fair value gain on available for sale financial assets
Divestment
- Post-period, sold entire shareholding in SatoshiPay Ltd (“SatoshiPay”) to Blue Star Capital Plc (“Blue Star”) for a total consideration of €725,220 in cash, representing an increase of 362.6% compared to the price paid for the shares in 2015
- Additionally, Coinsilium has received 85 million warrants over new Ordinary Shares of Blue Star, of which 42.5 million are exercisable at a price of 0.6 pence per Ordinary Share, and 42.5 million are exercisable at a price of 0.8 pence per share over a 3-year period from completion of the acquisition
Investments
During the period, the Company made its first investments in the emerging Digital Token space.
Coin-Dash Ltd
- Investment of USD$75,000 in Coin-Dash Ltd (“Coindash”), a company developing the world’s first social trading platform for cryptocurrency investors, through a Convertible Loan Agreement
Indorse Pte. Ltd
- Investment of SG$100,000 (circa £56,100) in Indorse Pte. Ltd. (“Indorse”) through a convertible loan agreement. Indorse is a Singapore-based company developing a blockchain-powered decentralized professional network
- Post-period, the Company was granted an option to subscribe for an additional 7% of the fully diluted share capital of Indorse with a value of SG$350,000. If exercised, it also grants Coinsilium a seat on the Board of Directors of the Company
Significant Developments in Investee Companies
Factom
- Factom added Medici Ventures (Overstock’s venture arm) to its stellar lineup of investors including Tim Draper, adding to a series A round
RSK Labs
- RSK Labs joined the second batch of the ‘Dubai Future Accelerator’ to work with the Dubai government on large-scale blockchain applications
- RSK Labs raised US$3.5m in a pre-series A round from a consortium of well-known blockchain companies and investors. Coinsilium has the rights to an equity stake circa 1% through a convertible instrument in RSK
Eddy Travia, CEO of Coinsilium, said:
“The first six months of 2017 have seen the most significant developments for Coinsilium where we made our first investments in the emerging Digital Token Space through Coindash and Indorse. The subsequent launch of Terrastream, to develop a token-based alternative funding solution operating in Gibraltar saw us become a venture builder as well as an investor and accelerator in early stage blockchain companies. We believe that we are at the forefront of this exciting market and remain well placed to capitalize on the opportunities it offers and to deliver shareholder value.”
OPERATIONAL REVIEW
Strategy
The near-term strategic objectives of the Company can be defined as follows:
- To reposition Coinsilium’s focus and market profile from an Investing Company to that of a Venture Builder, Accelerator, and Strategic Investor
- To build a focused capability in the emerging Digital Token economy in line with the forthcoming regulatory framework in Gibraltar and other supportive jurisdictions
- To ensure greater market awareness and recognition of the Company by leveraging management’s key connections and communications skills
Corporate Developments
- Memorandum of Understanding signed with leading Blockchain Smart Contract developer, Oraclize, to jointly develop and build an Enterprise scale Smart Contract System (“SCS”) for the next generation of blockchain-powered applications
- Memorandum of Understanding signed with HyperChain Capital (“HyperChain”), one of the world’s first multi-million-dollar hedge funds investing in Blockchain companies, to collaborate and finance co-investment opportunities in blockchain companies
- In January 2017, Hakim Mamoni, Executive Director, stepped down from the Board and left the Company to pursue other business interests
- Post-period, Non-Executive Director Malcolm Palle was appointed as Executive Chairman of the Company and the Company’s registered and operational office changed to 32 Threadneedle Street, London, EC2R 8AY.
Terrastream Ltd
Post-period, the Company formed Terrastream Limited (“Terrastream”), Coinsilium’s wholly owned subsidiary in Gibraltar. Terrastream aims to build an Enterprise standard blockchain-powered platform for the generation of token-based alternative funding solutions designed to operate in compliance with Gibraltar’s proposed forthcoming Distributed Ledger Technology (‘DLT’) Regulatory Framework.
Gibraltar Finance released a consultation document as part of its process towards establishing this regulatory framework and is set to become the first jurisdiction globally to provide a regulatory framework specifically designed for firms engaging in activities that use DLT for the transmission or storage of value belonging to others (DLT Framework), also covering Blockchain Technologies.
The board believes that the implementation of an effective regulatory framework by Gibraltar marks a crucial step-change for the industry which we expect to open up the market to a wider range of institutional investors. The operative date for the regulatory framework is expected to be no later than 1 January 2018 by which time we expect that Coinsilium will have firmly established its presence within the jurisdiction.
The build and development of the Terrastream platform are expected to be funded from the Company’s existing reserves and the proceeds of a proposed non-dilutive Token Generating Event, further details of which will be announced in due course. Gibraltar specialist Law firm ISOLAS has been appointed to advise on Terrastream structure and token sale.
Outlook
The period covered by this report was one of accelerated change and significant activity following the board restructure announced early in the half year. With costs now significantly reduced to a more appropriate level for a growth business of Coinsilium’s size, the board is now refocused on its core objectives and the Company has been repositioned to reflect its original ethos of identifying the early winners in the blockchain revolution and leverage some of the vast array of related opportunities in the sector. The Company has also taken several key strategic decisions regarding its growth and future direction and is now building a strong foundation with the recent appointment of a full-time Business Development Lead and other key appointments expected to follow.
The Digital Token space has grown rapidly since 2016 with over $1.8b raised by start-ups through various token sales to date . The sector has also been the subject of much media coverage and speculation recently following various pronouncements from regulatory bodies around the world. .
Despite the current wave of speculation, the board believes that the Digital Token economy holds significant promise and we expect it to become a central focus of Coinsilium’s activities going forward.
The board, in particular, CEO Eddy Travia, is in the forefront of this emerging space and he has recently been invited, on behalf of Coinsilium, onto the advisory board of several high-profile start-ups in the Digital Token space. The Company intends to leverage its skills and connections within this growing subset of blockchain technology from where we expect to be able to generate a significant near-term revenue stream for the Company.
To summarise, this has been a transitional period of positive change for Coinsilium. The management believes that blockchain technology and the array of potential applications will transform day to day life in the future. The Company’s early mover advantage into the blockchain space has provided it with invaluable insight, connections and investment opportunities to be leveraged for the benefit of all shareholders.