MANAGEMENT’S DISCUSSION AND ANALYSIS |
Three and six months ended June 30, 2021 |
◾ | On January 21, 2021, the Company’s common shares started trading on the NEO Exchange. The Company began to trade under the symbol DEFI upon listing on NEO Exchange. In conjunction with this uplisting, the Company arranged for the delisting of the Company from the TSX Venture Exchange effective the close of trading on January 20, 2021. |
◾ | On February 3, 2021, the Company announced that Thibaut Ceyrolle, EMEA (Europe, Middle East and Asia) founder and vice-president of Snowflake Inc., joined the board of advisors of Company. Mr. Ceyrolle has a wealth of experience in growing and scaling software and cloud industries companies for more than 20 years. |
◾ | On February 16, 2021, the Company appointed Wouter Witvoet as Chief Executive Officer of the Company. Mr. Witvoet previously was founder and CEO at Secfi Inc., the first platform offering financing secured by private company stock. |
◾ | On February 18, 2021, the Company appointed Teeka Tiwari as executive chairman of advisory board of the Company. Mr. Tiwari, as an investment analyst, is credited as being one of the first experts to explore cryptocurrencies. |
◾ | On February 26, 2021, the Company changes its name to DeFi Technologies Inc. |
◾ | On March 3, 2021, the Company has appointed Anthony Pompliano as an adviser to the Company. Mr. Pompliano manages an investment portfolio valued at approximately $500 million. He is the managing partner at Pomp Investments and previously co-founded asset management firm Morgan Creek Digital. Mr. Pompliano hosts the popular Pomp Podcast and writes a daily letter to more than 135,000 investors about bitcoin and digital assets. |
◾ | On March 9, 2021, the Company closed a non-brokered private placement financing of an aggregate of five million common shares of the Company at a price of $2 per common share for gross proceeds of $10 million. |
◾ | On March 12, 2021, the Company launched a new security product, DeFi Governance. DeFi Governance seeks to work with decentralized networks, running nodes to provide governance to networks and validate transactions globally. DeFi Technologies' initial partnership with Shyft Network contributors will be for Defi Technologies to openly implement node servers for its KYC decentralized network with the intention of becoming one of the initial globally distributed set of governance parties. The Shyft Network is building the first of its kind identity layer for decentralized finance so that participants and transacting institutions can provide additional transparency by identifying both sides of a transaction instantaneously and securely. In connection with running one of the consensus nodes, Defi Technologies can receive rewards from securing transactions on the Shyft Network as well as for providing governance services such as voting on code changes and other upgrades to the globally decentralized network. |
◾ | On April 1, 2021, the Company acquired the remaining interest of Valour Structured Products, Inc and owns 100% of Valour. |
◾ | On April 7, 2021, the Company wholly owned subsidiary, Valour Structured Products, has launched Ethereum Zero, an exchange-traded product that comes with zero management fees. The Company believes Bitcoin Zero and ETH Zero will give every investor the ability to access both the bitcoin and ethereum markets. |
◾ | On April 21, 2021, the Company completed a share exchange transaction with Hive Blockchain Technologies Ltd. Pursuant to the transaction, DeFi Technologies issued 10 million common shares of Defi Technologies to Hive in exchange for four million common shares of Hive. In addition to the transaction, Hive and Defi Technologies created a partnership surrounding the decentralized finance (Defi) ecosystem with specific applications around Ethereum and miner extractable value (MEV). The new partnership, which follows three months of discussions, will enable Hive with a strategic stake in Defi Technologies and a broader partnership surrounding the Defi ecosystem with a specific focus on the Ethereum-based MEV space and developments surrounding it. |
◾ | On April 22, 2021, the Company completed its implementation of the Shyft network node and has become one of the main validators of the Shyft network. By becoming a validator on the network, the Company joined the Shyft Federation. |
◾ | On May 14,2021, the Company added Krisztian Toth to the board of directors and Russell Starr to the management team as head of capital markets. Mr. Toth is an experienced mergers and acquisitions lawyer and partner at the law firm of Fasken Martineau DuMoulin LLP, which is a leading international business law and litigation firm. Mr. Toth is also a director of a number of public companies, including Voyager Digital, a publicly listed crypto-asset broker that provides retail and institutional investors with a turnkey solution to trade crypto assets. Mr. Starr is an established chief executive officer, entrepreneur and financier with deep capital markets and industry expertise. A trusted leader and adviser focused on forging meaningful, high-stakes, high-return business development connections. |
◾ | On May 18, 2021, Valour Structured Products Inc., a subsidiary of Defi Technologies Inc., launched its Cardano exchange-traded product on the Nordic Growth Market (“NGM”) stock exchange. |
◾ | On June 1, 2021, Valour Structured Products Inc., a subsidiary of Defi Technologies Inc., launched its Polkadot ETP on the NGM stock exchange. The Valour Polkadot ETP enables investors to gain exposure to DOT, the native token of the Polkadot protocol, simply and securely, through their bank or broker. |
◾ | On June 14, 2021, the Company completed the acquisition of a 10-per-cent equity interest in SDK:meta, LLC, a privately held web3 blockchain technology company driving mass adoption of user-centric platforms and mobile consumption of decentralized finance and related offerings. |
◾ | On June 16, 2021, the Company’s wholly owned subsidiary, Valour Structured Products, has signed a letter of intent with Arcane Crypto's wholly owned subsidiary, Arcane Assets AS, with the intention to explore the issuance and listing of an exchange-traded product (“ETP”) based on Arcane's cryptocurrency fund. The ETP would be the first to have a cryptocurrency fund as an underlying asset and the market provides exciting expansion possibilities for both the Arcane fund and Valour. Valour and Arcane Assets are working on a definitive partnership agreement and a plan for issuance and expect these to be completed later this year. |
◾ | On July 20, 2021, the Company appointed Russell Starr as executive chairman of the Company. |
June 30, 2021 | December 31, 2020 | |||
Quantity | $ | Quantity | $ | |
Binance Coin | 0.3000 | 113 | - | - |
Bitcoin | 1,524.2158 | 65,145,270 | - | - |
Cardano | 14,548,134.6031 | 23,620,555 | - | - |
Ethereum | 11,949.2453 | 31,422,005 | - | - |
Mobilecoin | 2,854.9570 | 36,340 | - | - |
Polkadot | 201,960.2757 | 3,804,705 | - | - |
Uniswap | 6.0000 | 143 | - | - |
USDC | 261,158 | - | 636,600 | |
USDT | 1,069 | - | - | |
Current | | 124,291,358 | $636,600 | |
Blocto | 250,000.0000 | 30,985 | - | - |
Maps | 285,713.0000 | 186,476 | - | - |
Oxygen | 400,000.0000 | 728,767 | - | - |
Saffron.finance | 86.2100 | 37,567 | - | - |
Sovryn | 13,916.6700 | 296,499 | - | - |
Long-Term | 1,280,294 | $- | ||
Total Digital Assets | 125,571,652 | $636,600 |
June 30, 2021 | December 31, 2020 | ||
Opening balance | $ 636,600 | ||
Digital assets acquried | 190,416,447 | $636,600 | |
Digital assets disposed | (83,385,099) | - | |
Revaluation adjustment | 17,903,704 | - | |
$ 125,571,652 | $636,600 |
Number of coins on loan | Value | |
Digital currencies on loan: Bitcoin | 450.0000 | $ 19,233,085 |
Ethereum | 5,001.1958 | 13,151,257 |
Polkadot | 20,094.2305 | 378,553 |
25,545.4263 | $ 32,762,895 |
Interest rates | Number of coins on loan | Value $ | |
Counterparties: Counterparty A | 3.05%-4.25% | 3,451.1958 | 27,122,467 |
Counterparty B | 3.02%-4.25% | 2,000.0000 | 5,259,245 |
Counterparty C | 20,094.2305 | 378,553 | |
25,545.4263 | $ 32,760,265 |
Public Issuer | Note | Security description | Cost | Estimated Fair Value | % of FV | ||||||||||||
Abaxx Technologies Inc.* | 19,900 common shares | 67,268 | 69,451 | 0.4 | % | ||||||||||||
DeFi Technologies Inc.* | (i) | 4,000,000 common shares | 400,000 | 3,600,000 | 18.5 | % | |||||||||||
Flora Growth Corp.** | (i) | 336,833 common shares | 999,334 | 1,552,992 | 8.0 | % | |||||||||||
Hive Blockchain Technologies Ltd | 4,000,000 common shares | 16,000,000 | 14,160,000 | 72.7 | % | ||||||||||||
Medivolve Inc. | (i) | 55,000 common shares | 6,600 | 3,850 | 0.0 | % | |||||||||||
Silo Wellness Inc. | (i) | 491,250 common shares | 49,125 | 73,688 | 0.4 | % | |||||||||||
Total public investments | $ | 17,522,327 | $ | 19,459,981 | 100.0 | % |
(i) | Investments in related party entities |
* | Held by Valour Inc. |
** | Became publicly traded investment in May 2021 |
Public Issuer | Note | Security description | Cost | Estimated Fair Value | % of FV | ||||||||||||
Medivolve Inc.* | (i) | 55,000 common shares | $ | 6,600 | $ | 22,000 | 3.3 | % | |||||||||
Sulliden Mining Capital Inc. | (i,ii) | 9,091,500 common shares | 2,662,252 | 545,490 | 81.9 | % | |||||||||||
Silo Wellness Inc.** | (i) | 982,500 common shares | 49,125 | 98,250 | 14.8 | % | |||||||||||
Total public investments | $ | 2,717,977 | $ | 665,740 | 100.0 | % |
* | formerly QuestCap Inc. |
* | formerly Yukoterre Resources Inc. |
(i) | Investments in related party entities |
(ii) | The Company has filed a Section 62-103 report pursuant to the Securities Act (Ontario) for this investment and has filed an early warning report on SEDAR. |
Private Issuer | Note | Security description | Cost | Estimated Fair Value | % of FV |
3iQ Corp.* | 187,007 common shares | $ 1,122,042 | $ 3,740,140 | 35.5% | |
Brazil Potash Corp. | (i) | 404,200 common shares | 1,998,668 | 2,003,862 | 19.0% |
Clover Inc. | Rights to certain equity | 50,076 | 49,576 | 0.5% | |
Luxor Technology Corporation | Rights to certain preferred shares | 203,847 | 619,700 | 5.9% | |
SDK:meta, LLC | 1,000,000 membership units | 4,050,000 | 4,050,000 | 38.5% | |
Skolem Technologies Ltd. | Rights to certain preferred shares | 25,612 | 24,788 | 0.2% | |
VolMEX Labs Corporation | Rights to certain preferred shares and warrants | 37,809 | 37,182 | 0.4% | |
Total private investments | $ 7,488,054 | $ 10,525,248 | 100.0% |
Private Issuer | Note | Security description | Cost | Estimated Fair Value | % of FV |
Brazil Potash Corp. | (i) | 404,200 common shares | $ 1,998,668 | $1,929,853 | 66.1% |
Flora Growth Corp. | (i) | 1,010,500 common shares | 999,334 | 964,926 | 33.0% |
Skolem Technologies Ltd. | Rights to certain preferred shares | 25,612 | 25,464 | 0.9% | |
Total private investments | $ 3,023,614 | $2,920,243 | 100.0% |
Purchase price consider paid: | |
Fair value of shares issued | $ 22,400,000 |
Fair value of assets and liabilities assumed: Blockchain Technology | $ 12,110,000 |
Brand Name | 4,252,000 |
Accounts payable | (6,968) |
Excess purchase price over fair value of assets assumed (expensed) | 6,044,968 |
Total net assets aquired | $ 22,400,000 |
Consideration for acquisition: | ||||
Fair value of shares issued | $ | 90,769,946 | ||
Accounting estimates of the acquisition with a purchase price of $90,769,946: | ||||
Cash and cash equivalents | 3,859,430 | |||
Amounts receivable | 21,677 | |||
Investments at fair value through profit or loss | 8,897,800 | |||
Digital assets | 67,831,424 | |||
Prepaid expenses and accrued revenues | 403,701 | |||
Property, plant and equipment | 10,443 | |||
Right-of-use assets | 53,899 | |||
Goodwill | 12,896 | |||
Accounts payable and accrued expenses | (1,094,855 | ) | ||
ETP holders payable | (68,848,678 | ) | ||
Lease liabilities | (53,899 | ) | ||
Blockchain Technology | 20,718,000 | |||
Brand Name | 20,383,000 | |||
52,194,838 | ||||
Goodwill | 38,575,108 | |||
Preliminary accounting estimate of net assets acquired | $ | 90,769,946 |
Three months ended June 30, | Six months ended June 30, | |||
2021 | 2020 | 2021 | 2020 | |
Revenues ETP trading | 2,504,214 | - | 2,504,214 | - |
Other trading income | 16,572 | - | 16,572 | - |
Lending income | 65,956 | - | 65,956 | - |
Realized (loss) on digital assets | (3,950,265) | - | (3,950,265) | - |
Unrealized (loss) on digital assets | (48,119,403) | - | (45,527,366) | - |
Unrealized gain on ETP | 49,823,748 | - | 49,823,748 | - |
Realized gain (loss) on investments, net | 10,073 | 4,240 | (1,915,040) | (197,863) |
Unrealized (loss) gain on investments, net | (2,274,452) | 279,670 | 319,747 | 286,165 |
Interest income | 3,130 | - | 3,364 | - |
Total revenues | (1,920,427) | 283,910 | 1,340,930 | 88,302 |
Expenses | ||||
Management and consulting fees | 1,028,600 | 38,593 | 2,285,317 | 112,463 |
Share based payments | 6,285,741 | - | 8,248,672 | - |
Travel and promotion | 405,352 | 5,174 | 566,246 | 9,735 |
Office and rent | 581,398 | 20,289 | 611,213 | 40,630 |
Accounting and legal | 143,199 | 11,229 | 288,243 | 31,675 |
Regulatory and transfer agent | 29,851 | (732) | 343,415 | 6,658 |
Depreciation - property, plant and equipment | 1,144 | - | 1,144 | - |
Depreciation - right of use assets | 16,089 | - | 16,089 | - |
Depreciation - intangibles | 993,350 | - | 1,195,183 | - |
Finance costs | 464,772 | - | 464,772 | - |
Transaction costs | 354,291 | 141 | 361,677 | 1,592 |
Foreign exchange gain (loss) | (31,420) | (5,924) | (42,617) | 1,361 |
Total expenses | 10,272,367 | 68,770 | 14,339,354 | 204,114 |
Loss before other items | (12,192,794) | 215,140 | (12,998,424) | (115,812) |
Excess purchase price over fair value of assets assumed (expensed) | - | - | (6,044,968) | - |
Net (loss) income for the period | $(12,192,794) | $215,140 | $ (19,043,392) | $(115,812) |
Other comprehensive loss | ||||
Foreign currency translation loss | (129,082) | - | (130,780) | - |
Net (loss) income and comprehensive (loss) income for the period | (12,321,876) | 215,140 | (19,174,172) | (115,812) |
June 30, 2021 | |||
United States Dollars | British Pound | European Euro | |
Cash | $ 8,548,076 | $ - | $ - |
Receivables | 23,224 | - | - |
Loan receivable | 123,940 | - | - |
Public investments | 1,552,992 | - | - |
Private investments | 6,785,108 | - | - |
Prepaid investment | 146,875 | - | 1,074,191 |
Digital assets | 124,618,842 | - | - |
Accounts payable and accrued liabilities | (123,792,851) | (75,745) | - |
Net assets (liabilities) | $ 18,006,205 | $ (75,745) | $ 1,074,191 |
a) | to allow the Company to respond to changes in economic and/or marketplace conditions by maintaining the Company’s ability to purchase new investments; |
b) | to give shareholders sustained growth in value by increasing shareholders’ equity; while |
c) | taking a conservative approach towards financial leverage and management of financial risks. |
a) | raising capital through equity financings; and |
b) | realizing proceeds from the disposition of its investments |
30-Jun | 31-Mar | 31-Dec | 30-Sep | 30-Jun | 31-Mar | 31-Dec | 30-Sep | |
2021 | 2021 | 2020 | 2020 | 2020 | 2020 | 2019 | 2019 | |
Revenue | ($1,920,427) | $3,261,357 | ($216,972) | $3,079,896 | $283,910 | ($195,608) | ($190,735) | $107,411 |
Net (loss) income and comprehensive (loss) income | ($12,321,876) | ($6,852,296) | ($770,324) | $2,959,668 | $215,140 | ($330,952) | ($269,147) | ($92,534) |
(Loss) income per Share - basic | ($0.06) | ($0.04) | ($0.01) | $0.05 | $0.01 | ($0.01) | ($0.01) | ($0.00) |
(Loss) income per Share - diluted | ($0.06) | ($0.04) | ($0.01) | $0.05 | $0.01 | ($0.01) | ($0.01) | ($0.00) |
Total Assets | $261,772,737 | $194,017,574 | $7,296,044 | $3,785,693 | $740,725 | $432,597 | $636,459 | $898,625 |
Total Long Term Liabilities | $38,240 | $Nil | $Nil | $Nil | $Nil | $Nil | $Nil | $Nil |
31-Dec-20 | 31-Dec-19 | 31-Dec-18 | |
(a) Net Sales | - | - | - |
(b) Net Income (Loss) and Comprehensive Income (Loss) | |||
(i) Total income (loss) | $2,073,533 | ($1,507,338) | ($9,794,067) |
(ii) Income (loss) per share – basic | $0.04 | ($0.04) | ($0.24) |
(iii) Income (loss) per share – diluted | $0.04 | ($0.04) | ($0.24) |
(c) Total Assets | $7,296,044 | $636,459 | $1,946,695 |
(d) Total Liabilities | $992,248 | $1,802,024 | $1,604,922 |
Investment | Nature of relationship | Estimated Fair value | % of FV |
Brazil Potash Corp.* | Director (Stan Bharti), officer (Ryan Ptolemy) and common | $ 2,003,862 | 55.2% |
shareholders | |||
Flora Growth Corp. | Directors (Stan Bharti, Bernie Wilson), and common shareholders | 1,552,992 | 42.7% |
Medivolve Inc. | Former director (Stan Bharti), director (Daniyal Baizak), and | 3,850 | 0.1% |
common shareholders | |||
Silo Wellness Inc. | Former Director and Officer (Fred Leigh), Officers | 73,688 | 2.0% |
(Kenny Choi, Ryan Ptolemy) and common shareholders | |||
Total investment - June 30, 2021 | $ 3,634,392 | 100.0% |
* | Private companies |
Investment | Nature of relationship | Estimated Fair value | % of FV | |||||||
Brazil Potash Corp.* | Director (Stan Bharti), officer (Ryan Ptolemy) and common | $ | 1,929,853 | 54.2 | % | |||||
shareholders | ||||||||||
Flora Growth Corp.* | Directors (Stan Bharti, William Steers), and common shareholders | 964,926 | 27.1 | % | ||||||
Medivolve Inc.** | Former director (Stan Bharti), director (Daniyal Baizak), and | 22,000 | 0.6 | % | ||||||
common shareholders | ||||||||||
Sulliden Mining Capital Inc. | Director (Stan Bharti, William Steers) and officer (Ryan Ptolemy) | 545,490 | 15.3 | % | ||||||
Silo Wellness Inc. | Former Director and Officer (Fred Leigh), Officer | 98,250 | 2.8 | % | ||||||
(Kenny Choi, Ryan Ptolemy) and common shareholders | ||||||||||
Total investment - December 31, 2020 | $ | 3,560,519 | 100.0 | % |
* | Private companies |
** | Formerly QuestCap Inc. |
*** | Formerly Yukoterre Resources Inc. |
• | The Company incurred $60,000 (2020 - $60,000) of expenses for its proportionate share of shared office costs with other corporations that may have common directors and officers. The costs associated with this space are administered by 2227929 Ontario Inc. As at June 30, 2021, the Company had a payable balance of $nil (December 31, 2020 - $$80,183) with 2227929 Ontario Inc. to cover shared expenses. Such amounts are unsecured, non-interest bearing, with no fixed terms of payment and due on demand. Fred Leigh, a former officer and former director of the Company, is also a director of 2227929 Ontario Inc. |
• | The Company incurred $60,000 (2020 - $60,000) for administration costs with Forbes & Manhattan, Inc. (“Forbes”). In August 2017, Forbes became an insider of the Company owning approximately 34.9%, at the time, (approximately 16.3% at December 31, 2020) outstanding shares of the Company through an acquisition of Quebec Gold royalty interests. The Company is also part of the Forbes Group of Companies and continue to receive the benefits of such membership, including access to mining professionals, advice from Stan Bharti, the Executive Chairman of Forbes and strategic advice from the Forbes Board of Advisors. An administration fee of $10,000 per month is charged by Forbes pursuant to a consulting agreement. During the six months ended June 30, 2021, Forbes received $75,000 bonus. As at June 30, 2021, the Company had a payable balance of $34,819 (December 31, 2020 - $22,600) with Forbes. Such amounts are unsecured, non-interest bearing, with no fixed terms of payment and due on demand. Forbes participated in the Company’s January 2021 private placement financing and subscribed an aggregate 189,900 shares for gross proceeds of $379,800. As at June 30, 2021, Forbes ceased to be an insider of the Company. |
• | Included in accounts payable and accrued liabilities were expenses of GBP 44,228 ($75,745) (December 31, 2020 - $76,872 expenses owed to Vik Pathak, a former director and officer of DeFi. |
• | In connection with the March 2021 private placement financing, an inside of the Company also subscribed 189,900 shares. A director and officer also subscribed 12,500 shares for gross proceeds of $25,000. |
• | In connection with the February 24, 2021 stock option grant, 500,000 options were granted to directors of the Company. |
• | In connection with the April 9, 2021 stock option grant, 1,000,000 options were granted to directors and officers of the Company. |
• | In connection with the May 18, 2021 stock option grant, 2,700,000 options were granted to directors and officers of the Company. |
• | In connection with the May 25, 2021 stock option grant, 450,000 options were granted to a director of the Company. |
i. | The carrying values of cash, amounts receivable, accounts payable and accrual liabilities approximate their fair values due to the short-term nature of these instruments. |
ii. | Public and private investments are carried at amounts in accordance with the Company’s accounting policies as set out in Note 2 of the Company’s audited consolidated financial statements for the years ended December 31, 2020 and 2019. |
iii. | Digital assets are carried at the amount of US dollars they can be converted into. |
Level 1 | Level 2 | Level 3 | ||||||||||||||
Investments, fair value | (Quoted Market price) | (Valuation technique -observable market Inputs) | (Valuation technique - non-observable market inputs) | Total | ||||||||||||
Publicly traded investments | $ | 3,746,989 | $ | 15,712,992 | $ | - | $ | 19,459,981 | ||||||||
Privately traded invesments | - | 10,525,248 | 10,525,248 | |||||||||||||
Digital assets | - | 125,571,652 | - | 125,571,652 | ||||||||||||
June 30, 2021 | $ | 3,746,989 | $ | 141,284,644 | $ | 10,525,248 | $ | 155,556,881 | ||||||||
Publicly traded investments | $ | 567,490 | $ | - | $ | 98,250 | $ | 665,740 | ||||||||
Privately traded invesments | - | - | 2,920,243 | 2,920,243 | ||||||||||||
Digital assets | - | 636,600 | - | 636,600 | ||||||||||||
December 31, 2020 | $ | 567,490 | $ | 636,600 | $ | 3,018,493 | $ | 4,222,583 |
Investments, fair value for the period ended | June 30, 2021 | December 31, 2020 |
Balance, beginning of period | $ 636,600 | $ - |
Purchases | 206,404,477 | 636,600 |
Disposal | (83,385,099) | - |
Transferred from Level 3 | 1,051,233 | - |
Realized and unrealized gain/(loss) net | 16,577,433 | - |
Balance, end of period | $ 141,284,644 | $ 636,600 |
Level 3 Hierarchy
The following table presents the changes in fair value measurements of financial instruments classified as Level 3 during the periods ended June 30, 2021 and December 31, 2020. These financial instruments are measured at fair value utilizing non-observable market inputs. The net realized losses and net unrealized gains are recognized in the statements of loss.
Investments, fair value for the period ended | June 30, 2021 | December 31, 2020 | ||||||
Balance, beginning of period | $ | 3,018,493 | $ | - | ||||
Purchases | 5,463,774 | 3,121,864 | ||||||
Transferred to Level 2 | (1,051,233 | ) | - | |||||
Realized and unrealized gain/(loss) net | 3,094,214 | (103,371 | ) | |||||
Balance, end of period | $ | 10,525,248 | $ | 3,018,493 |
Within Level 3, the Company includes private company investments that are not quoted on an exchange. The key assumptions used in the valuation of these instruments include (but are not limited to) the value at which a recent financing was done by the investee, company-specific information, trends in general market conditions and the share performance of comparable publicly traded companies.
As valuations of investments for which market quotations are not readily available, are inherently uncertain, may fluctuate within short periods of time and are based on estimates, determination of fair value may differ materially from the values that would have resulted if a ready market existed for the investments. Given the size of the private investment portfolio, such changes may have a significant impact on the Company’s financial condition or operating results.
The following table presents the fair value, categorized by key valuation techniques and the unobservable inputs used within Level 3 as at June 30, 2021.
Description | Fair vaue | Valuation technique | Significant unobservable input(s) | Range of significant unobservable input(s) | ||||||
3iQ Corp.* | $ | 3,740,140 | Recent financing | Marketability of shares | 0% discount | |||||
Brazil Potash Corp. | 2,003,862 | Recent financing | Marketability of shares | 0% discount | ||||||
Clover Inc. | 49,576 | Recent financing | Marketability of shares | 0% discount | ||||||
Luxor Technology Corporation | 619,700 | Recent financing | Marketability of shares | 0% discount | ||||||
SDK:meta, LLC | 4,050,000 | Transaction price | Marketability of shares | 0% discount | ||||||
Skolem Technologies Ltd. | 24,788 | Recent financing | Marketability of shares | 0% discount | ||||||
VolMEX Labs Corporation | 37,182 | Recent financing | Marketability of shares | 0% discount | ||||||
$ | 10,525,248 |
Stock Options:
• | continued worldwide growth in the adoption and use of cryptocurrencies; |
• | governmental and quasi-governmental regulation of cryptocurrencies and their use, or restrictions on or regulation of access to and operation of the network or similar cryptocurrency systems; |
• | changes in consumer demographics and public tastes and preferences; |
• | the maintenance and development of the open-source software protocol of the network; |
• | the availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies; |
• | general economic conditions and the regulatory environment relating to digital assets; and |
• | negative consumer sentiment and perception of cryptocurrencies. |
• | continued worldwide growth in the adoption and use of Bitcoins and other digital currencies; |
• | government and quasi-government regulation of Bitcoins and other digital assets and their use, or restrictions on, or regulation of, access to and operation of the Bitcoin Network or similar digital asset systems; |
• | changes in consumer demographics and public tastes and preferences; |
• | the maintenance and development of the open-source software protocol of the Bitcoin Network or similar digital asset systems; |
• | the availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies; |
• | general economic conditions and the regulatory environment relating to digital assets; and |
• | negative consumer perception of Bitcoins specifically and cryptocurrencies generally. |