Document and Entity Information
Document and Entity Information - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Jun. 30, 2017 | |
Document and Entity Information: | ||
Entity Registrant Name | RocketFuel Blockchain, Inc. | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Trading Symbol | rkfl | |
Amendment Flag | false | |
Entity Central Index Key | 823,546 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 22,668,416 | |
Entity Public Float | $ 21,605,038 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Mar. 31, 2018 | ||
Current assets | ||||
Cash | $ 20,746 | $ 300 | ||
Total current assets | 20,746 | 300 | ||
Total assets | 20,746 | 300 | ||
Current liabilities | ||||
Accounts payable and accrued expenses | 22,706 | 3,500 | ||
Advances payable to related parties | 305 | |||
Total current liabilities | 22,706 | 3,805 | ||
Total liabilities | 22,706 | 3,805 | ||
Stockholders' equity | ||||
Common stock | 22,668 | [1] | 1 | [2] |
Additional paid-in capital | 3,387,507 | 250,299 | ||
Accumulated deficit | (3,412,135) | (253,805) | ||
Total stockholders' equity | (1,960) | (3,505) | ||
Total liabilities and stockholders' equity | $ 20,746 | $ 300 | ||
[1] | $0.001 par value, 250,000,0000 shares authorized; 22,668,416 shares issued and outstanding as of 9/30/2018. | |||
[2] | $0.001 par value, 750,000,0000 shares authorized; 1,000 shares issued and outstanding as of 3/31/2018. |
Condensed Statements of Operati
Condensed Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | 6 Months Ended |
Sep. 30, 2018 | Sep. 30, 2018 | |
Expenses | ||
General and administrative | $ 3,243,125 | $ 3,284,325 |
Total expenses | 3,243,125 | 3,284,325 |
Income (loss) from operations | (3,243,125) | (3,284,325) |
Other (income) expense: | ||
Forgiveness of debt | (35,250) | (35,250) |
Total other (income) expense | (35,250) | (35,250) |
Income (loss) before provision for taxes | (3,207,875) | (3,249,075) |
Net income (loss) | $ (3,207,875) | $ (3,249,075) |
Net income (loss) per common share, basic | $ (0.14) | $ (0.27) |
Net income (loss) per common share, diluted | $ (0.14) | $ (0.27) |
Shares used in computing net income (loss) per common share, basic | 22,668,416 | 11,855,321 |
Shares used in computing net income (loss) per common share, diluted | 22,668,416 | 11,855,321 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) | 3 Months Ended | 6 Months Ended |
Sep. 30, 2018 | Sep. 30, 2018 | |
Cash flows from operating activities | ||
Net income (loss) | $ (3,207,875) | $ (3,249,075) |
Adjustments to reconcile net income (loss) to net cash flows used in operating activities: | ||
Stock-based compensation | 3,154,208 | 3,154,208 |
Changes in assets and liabilities: | ||
Increase (decrease) in accounts payable and accrued expenses | 19,206 | |
Net cash flows provided by (used in) operating activities | (75,661) | |
Cash flows from financing activities | ||
Repayment of related party advances | (305) | |
Effect of reverse merger transaction on additional paid-in capital | 96,412 | |
Net cash flows provided by (used in) financing activities | 96,107 | |
Net change in cash | 20,446 | |
Cash at beginning of period | 300 | |
Cash at end of period | $ 20,746 | $ 20,746 |
Business Description
Business Description | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Business Description | 1. Business Business RocketFuel Blockchain Company, a Nevada corporation (RocketFuel or the Company) was formed on January 12, 2018 for the purpose of bringing highly efficient check-out systems to eCommerce. These new check-out means based upon blockchain technology are designed to increase speed, security, and ease of use. Using RocketFuels technology, merchants can enable new impulse buying schemes that may be unavailable in present day eCommerce sites. On June 27, 2018, we consummated a transaction as contemplated by that certain Contribution Agreement made and entered into as of June 27, 2018 by and among B4MC Gold Mines, Inc. (B4MC), a Nevada corporation, and us. Pursuant to the Contribution Agreement, B4MC issued 17,001,312 shares of its $0.001 par value common stock to us in exchange for a 100% ownership interest in us resulting in 22,668,416 post-merger shares of B4MC common stock issued and outstanding. On September 25, 2018, B4MC changed its name to RocketFuel Blockchain, Inc. On June 29, 2018, we filed a Current Report on Form 8-K with the Securities and Exchange Commission which fully describes the transaction set forth herein. Our corporate headquarters are located in Las Vegas, Nevada. |
Interim Financial Statements an
Interim Financial Statements and Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Interim Financial Statements and Basis of Presentation | 2. Interim Financial Statements and Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information pursuant to Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three and six months ended September 30, 2018 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. These condensed financial statements should be read in conjunction with our audited financial statements as of March 31, 2018 and for the period from January 12, 2018 (date of inception) through March 31, 2018, which are included in Exhibit 99.1 of our Current Report on Form 8-K as filed with the Securities and Exchange Commission (the SEC) on June 29, 2018. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments, which are evaluated on an ongoing basis, and that affect the amounts reported in our unaudited condensed financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. Our significant accounting policies are described in Note 3 to the audited financial statements as of March 31, 2018 and for the period from January 12, 2018 (date of inception) through March 31, 2018, which are included in Exhibit 99.1 of the Current Report of B4MC Gold Mines, Inc., our predecessor company, on Form 8-K as filed with the SEC on June 29, 2018. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Going Concern | 3. Going Concern Our financial statements have been presented on the basis that we are a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We incorporated our business on January 12, 2018. During the six months ended September 30, 2018, we have reported a net loss of $3,249,075 and negative cash flows of $75,661 from operating activities. As of September 30, 2018, we reported negative working capital of $1,960. As a result, management believes that there is substantial doubt about our ability to continue as a going concern. Prior to June 27, 2018, management was engaged in efforts to identify and negotiate a transaction with a public company quoted on the OTC Markets having shell status where a contemplated transaction would be treated as a reverse merger. On June 27, 2018, we consummated a transaction as contemplated by that certain Contribution Agreement made and entered into as of June 27, 2018 by and among B4MC and us. Pursuant to the Contribution Agreement, B4MC issued 17,001,312 shares of its $0.001 par value common stock to us in exchange for a 100% ownership interest in us resulting in 22,668,416 post-merger shares of B4MC common stock issued and outstanding. We financed our efforts to consummate this reverse merger transaction through the issuance of equity securities. We will require additional financing in order to continue to develop our product and execute on our business plan. However, there can be no assurances that we will be successful in raising the additional capital necessary to continue operations and execute on our business plan. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Summary of Significant Accounting Policies | 4. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on our accounting and reporting. We believe that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on our accounting or reporting or that such impact will not be material to our financial position, results of operations and cash flows when implemented. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Related Party Transactions | 5. Related Party Transactions As of September 30, 2018 and March 31, 2018, we reported $0 and $305, respectively, as an advance payable to related party. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Income Taxes | 6. Income Taxes We are required to file federal and state income tax returns in the United States. The preparation of these tax returns requires us to interpret the applicable tax laws and regulations in effect in such jurisdictions, which could affect the amount of tax paid by us. In consultation with our tax advisors, we base our tax returns on interpretations that are believed to be reasonable under the circumstances. The tax returns, however, are subject to routine reviews by the various federal and state taxing authorities in the jurisdictions in which we file tax returns. As part of these reviews, a taxing authority may disagree with respect to the income tax positions taken by us (uncertain tax positions) and, therefore, may require us to pay additional taxes. As required under applicable accounting rules, we accrue an amount for our estimate of additional income tax liability, including interest and penalties, which we could incur as a result of the ultimate or effective resolution of the uncertain tax positions. We account for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carry-forwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred tax assets to amounts expected to be realized. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Income tax credit for the three and six months ended September 30, 2018 was $0 and $0, respectively. The effective tax rates for the six months ended September 30, 2018 was 21.0%. We have estimated our provision for income taxes in accordance with the Tax Act and guidance available as of the date of this filing but have kept the full valuation allowance. The 2018 tax rate reflects the enactment of the Tax Cuts and Jobs Act of 2017 (the Act) which made significant changes to the Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the Tax Act) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a federal corporate tax rate decrease from 35% to 21% for tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of foreign earnings. On December 22, 2017, Staff Accounting Bulletin No. 118 ("SAB 118") was issued to address the application of US GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. The deferred tax expense recorded in connection with the remeasurement of deferred tax assets is a provisional amount and a reasonable estimate at December 31, 2017 based upon the best information currently available. The ultimate impact may differ from these provisional amounts, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued, and actions the Company may take as a result of the Tax Act. Any subsequent adjustment to these amounts will be recorded to current tax expense in the quarter of 2018 when the analysis is complete. The accounting is expected to be complete when the 2017 U.S. corporate income tax return is filed in 2018. |
Stockholders' Deficit
Stockholders' Deficit | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Stockholders' Deficit | 7. Stockholders Deficit Prior to August 8, 2018, we had 750,000,000 shares of our $0.001 par value common stock authorized. On August 8, 2018, our Board of Directors voted to amend our articles of incorporation whereby the authorized shares of our common stock were reduced to 250,000,000. Additionally, the Board authorized 50,000,000 shares of $0.001 par value preferred stock. On September 25, 2018, we filed a certificate of amendment to our articles of incorporation to effect such changes. On June 27, 2018, we consummated a transaction as contemplated by that certain Contribution Agreement made and entered into as of June 27, 2018 by and among B4MC and us. Pursuant to the Contribution Agreement, B4MC issued 17,001,312 shares of its $0.001 par value common stock to us in exchange for a 100% ownership interest in us resulting in 22,668,416 post-merger shares of B4MC common stock issued and outstanding. As of September 30, 2018 and March 31, 218, we had 22,668,416 shares and 1,000 shares of our common stock issued and outstanding. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Stock-based Compensation | 8. Stock-Based Compensation On August 8, 2018, the Board and stockholders holding a majority of our voting power approved the RocketFuel Blockchain, Inc., 2018 Equity Incentive Plan, which plan enables us to make awards that qualify as performance-based compensation. We have reserved 2,000,000 shares of our common stock for issuance in connection with awards under the plan. On August 8, 2018, our Board of Directors approved the grant of options to purchase 500,000 shares of our common stock to Mr. Bennett J. Yankowitz, our chief financial officer and a director, pursuant to an exemption under Section 4(a)(2) of the Securities Act of 1933, as amended. Pursuant to the terms of the option agreement, these options are exercisable immediately on the date of grant at an exercise price of $3.00 per share and are exercisable for a term of 10 years from the date of grant. In determining the fair value of the stock option, we will utilize the Black-Scholes pricing model utilizing the following assumptions: i) stock option exercise price of $3.00; ii) fair market value of our common stock of $8.50, which was based on available valuation factors made available to us during the period from the date of grant through the end of our fiscal quarter ending September 30, 2018; iii) expected term of option of 7 years; iv) expected volatility of our common stock of approximately 40%; v) expected dividend rate of 0.0%; and vi) risk-free interest rate of approximately 2.80%. As a result, we recorded stock-based compensation of $3,154,208 during each of the three and six months ended September 30, 2018. |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Legal Proceedings | 9. Legal Proceedings We are not the subject of any pending legal proceedings; and to the knowledge of management, no proceedings are presently contemplated against us by any federal, state or local governmental agency. Further, to the knowledge of management, no director or executive officer is party to any action in which any has an interest adverse to us. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
Subsequent Events | 10. Subsequent Events We evaluated all events or transactions that occurred after the balance sheet date through the date when we issued these financial statements and, other than as described below, we did not have any material recognizable subsequent events during this period. On October 1, 2018, we entered into a corporate advisory agreement with a consultant (the Consultant), who is a non-related party, to provide business advisory services, including research distribution services. As compensation for these services, the Consultant received 12,500 shares of our common stock having a value of $120,312 based on a fair market value of $9.625 per share as quoted on the OTC Markets on the date of issuance. |