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Bridging Traditional Finance and Digital Assets

The First Publicly Listed Payment Service Provider for the Digital Asset Industry

July 22, 2021

Banxa Holdings Inc. (TSX-V:BNXA) (OTCQX:BNXAF) (FSE:AC00) is a Payment Service Provider (PSP) on a mission to bridge the gap between traditional financial systems and the digital asset space. Their goal is to introduce the general public to digital currency by building a fully compliant payment infrastructure that enables simple and secure conversion of fiat currency to digital currency (eg. USD/CAD to BTC/ETH). As the adoption of crypto currencies becomes more widespread, we think that Banxa will become the leading PSP in the digital asset space. 

For more info go to www.banxa.com 

 

The Future of Digital Transactions

Increasing Interest in Digital Assets – According to a Facts and Factors report, the global cryptocurrency market in 2019 was valued at $792M, and is expected to grow at a CAGR of 30% through 2026, when it is projected to surpass $5T. At this point, even traditional financial giants are taking notice. JP Morgan has released their own ecoin and other big banks are looking to offer digital asset products as well. Tesla is already heavily invested in Bitcoin, and crypto diversification is becoming more normal across many businesses. This growth in mainstream adoption makes Banxa an integral part of the future of finance. 

A Hedge Against Crypto Volatility – Everyone knows that crypto currencies are subject to massive swings in value; so while there is no doubt that digital assets will be an important part of future markets, some people are not sold on the relative risk of investing directly in a digital coin. Banxa represents an excellent hedge, because its value is tied to trading volumes and transactions, not the value of the coins themselves. 

Excellent Financials – Banxa has experienced massive growth, posting $21M in revenue for the three months ended March 31, 2021, up 1,479% from $1.3M during the same period in 2020. Additionally, they have $25M in cash and cash equivalents on hand (as of March 26, 2021), and a total transaction value (TTV) of $205M, up 93% from the previous quarter. Overall, Banxa is in a great financial position for sustained growth and profitability. 

Proven Model – PayPal, Stripe, Square, and plenty of others have proven that the PSP model is incredibly valuable and scalable. Banxa has an edge as the first publicly listed PSP that bridges the gap between traditional payments and crypto, and if the success of previous PSP businesses indicate anything, it’s that Banxa could soon be a household name. 

Leader in Compliance – Crypto can still seem a little bit intimidating due to its origins and deregulated nature, but Banxa is focused on reliability, transparency, and security. This goes a long way toward capturing B2B business, as shown by their webpage of client case studies. Banxa currently has multiple digital asset licences and registrations globally, and a full Anti Money Laundering/Know Your Customer compliance platform. By leading the charge for compliance, they are positioning themselves as the most trustworthy PSP for digital assets on the market.

 

 

Picks and Shovels

Let’s be very clear about something, Banxa is NOT a crypto exchange. Rather, they serve as the “picks and shovels” of the crypto industry, allowing businesses to convert fiat currency to crypto for their customers. 

Think of Banxa as a card reader at a brick-and-mortar store; it doesn’t really matter too much what the store is offering or what currency the customer is paying with, Banxa is there to facilitate the transaction. 

Because of this, Banxa’s value is not based on the price of Bitcoin or what have you, but the volume of transactions. It doesn’t matter if someone is buying or selling, Banxa is the middle man taking a small percentage from the merchant. And total transaction volume is up. Way up. 

 

 

As you can see from the graph, Banxa’s year-over-year TTV grew from $26M-$205M. That is an impressive increase, and we think it will only compound as cryptocurrencies gain popularity. At the time of this writing, the total aggregate value of the crypto market is about $2T, with no sign of shrinking. 

Add to that, Banxa is already working with some of the biggest names in crypto: Abra, Binance, Changelly, Edge, and more. Their platform supports all digital assets, and is compatible with other mainstream payment methods like debit/credit cards, Interac e-transfers, bank transfer, and Apple Pay. 

 

The Best Play in Crypto is Currently Undervalued

When we look at a crypto exchange like Coinbase, with a market cap of roughly $48B, we see a hyped-up stock tied directly to the value of the crypto market that has fallen by almost half in just a few months. Banxa on the other hand, with their current market cap of just $166M, has plenty of room to grow and is a better value given their price and trajectory. 

Everyone is looking to find a great angle on the crypto market, and we think focusing on a payment gateway like Banxa is going to be one that pays off. The service they offer is essential for democratizing and simplifying the buying and selling of crypto, and very few companies are able to offer the compliance platform that Banxa does. As the leading digital asset PSP in Canada and Australia, they are a proven entity with the momentum to propel them to a global scale. This is a crypto play that we are truly excited about. 

 

Looking Ahead

Banxa is still a young company in a new market. As the market matures, we expect Banxa to mature (and grow) with it. It’s clear that crypto isn’t going anywhere, and a compliance focused payment gateway is the hinge that the market’s continued growth pivots on. Banxa handles all of the regulatory issues that could potentially hold up transactions for their customers, enabling a smooth process of fiat-to-crypto exchanges. 

The Banxa team is ready to grow their B2B client base from 63 to 500, and expand services into new countries. There are plenty of opportunities in the crypto space yet to be mined, and Banxa is in an excellent position to capitalize on market trends. 

We are bullish on Banxa from a financial perspective alone, and with growing interest in cryptocurrency around the globe, we have a real gem in Banxa. If things keep trending the way they are now, we think they just might end up being the Stripe of digital assets. 

 

Recent Press Releases

 

Leadership

DOMENIC CAROSA

FOUNDER & CHAIRMAN

Domenic is a tech pioneer, having founded or invested in over 50 technology companies over the last 25 years, both private and public. He holds a Masters of Entrepreneurship and Innovation (MEI) from Swinburne University Australia.

 

HOLGER ARIANS

CEO

Holger has previously built and run several startups. Prior to BANXA, he oversaw a portfolio of 30 early stage technology companies as CEO of Dominet Venture Partners. He holds an Executive MBA from Manheim and Essec Business Schools and is an Alumni of Harvard Business School.

 

KONSTANTIN LICHTENWALD

CFO (CPA, CGA, ACCA)

Konstantin has extensive experience as chief financial officer and specializes in providing corporate finance, taxation, and financial reporting. He previously worked at Ernst & Young and holds a BBA from Pforzheim University, Germany.

 

JOSH D’AMBROSIO

GENERAL MANAGER

Josh is an experienced risk and compliance executive serving in Ernst & Young’s IT Risk Advisory Team for 5 years prior to joining BANXA in July 2017. Before these roles, Josh founded and scaled a social sports company to become the Australian market leader in its industry.

 

IAIN CLARK

CTO

Iain was previously the CTO of public listed company Crowd Media for 7 years. Before that he was a Vice President at Goldman Sachs in London. He is focussed on technical excellence, platform security, and executing the company’s strategic vision.

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Who are we and what do we do? We are paid advertisers, also known as stock touts or stock promoters, who disseminate favorable information (the “Information”) about publicly traded companies (the “Profiled Issuers”). How is the Information published? We publish the Information on our Website, in newsletters, audio services, live interviews, featured “research” reports, on message boards and in email communications for specific time periods that are agreed upon between us and the Profiled Issuer or third party paying us. Our publication of the Information is known as a “Campaign”. Will everyone receive the Information at the same time? No. The Information may be sent to potential investors at different times that are minutes, hours, days or even weeks apart. How is a potential investor impacted if he receives the Information later than other investors? Typically, the trading volume and price of a Profiled Issuer’s securities increases after the Information is provided to the first group of investors. Therefore, the later an investor receives the Information, the more likely it is that he will suffer increased trading losses if he purchases the securities of a Profiled Issuer. What will happen to the shares that we hold during the Campaign? We will sell the shares we hold while we tell investors to purchase during the Campaign. What will happen when the Campaign ends? Most, if not all, of the Profiled Issuers are penny stocks that are illiquid and whose securities are subject to wide fluctuations in trading price and volume. During the Campaign the trading volume and price of the securities of each Profiled Issuer will likely increase significantly. When the Campaign ends, the volume and price of the Profiled Issuer will likely decrease dramatically. 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Who is responsible if an investor relies on the Information? The investor. We are not responsible or liable for any person’s use of the Information or any success or failure that is directly or indirectly related to such person’s use of the Information because we have specifically stated that the information is not reliable and should not be relied upon for any purpose. We are not responsible for omissions or errors in the Information, and we are not responsible for actions taken by any person who relies upon the Information. What do we urge potential investors to do? We urge Investors to conduct their own in-depth investigation of the Profiled Issuers with the assistance of their legal, tax and investment advisers. An investor’s review of the Information should include but not be limited to the Profiled Issuer’s financial condition, operations, management, products or services, trends in the industry and risks that may be material to the profiled Issuer’s business and other information he and his advisers deem material to an investment decision. An investor’s review should include, but not be limited to a review of available public sources and information received directly from the Profiled Issuers or from websites such as Google, OTC Markets, NASDAQ, NYSE, www.sec.gov or other available public sources. Why is this Disclaimer being provided? We are providing you with this disclaimer because we are publishing advertisements about penny stocks. Because we are paid to disseminate the Information to the public about securities, we are required by the securities laws including Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 thereunder, and Section 17(b) of the Securities Act of 1933, as amended (the “Securities Act”), to specifically disclose our compensation as well as other important information, This information includes that we may hold, as well as purchase and sell, the securities of a Profiled Issuer before, during and after we publish favorable Information about the Profiled Issuer. We may urge investors to purchase the securities of a Profiled Issuer while we sell our own shares. The anti-fraud provisions of federal and state securities laws require us to inform you that we may engage in buying and selling of Profiled Issuer’s securities before, during and after the Campaigns. What are other risks that investors should be aware of? Any investment in the Profiled Issuers involves a high degree of risk and uncertainty. The securities may be subject to extreme volume and price volatility, especially during the Campaigns. Favorable past performance of a Profiled Issuer does not guarantee future results. If you purchase the securities of the Profiled Issuers, you should be prepared to lose your entire investment. Some of the risks involved in purchasing securities of the Profiled Issuers include, but are not limited to the risks stated below.
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If a Profiled Issuer is an SEC reporting company, it could be delinquent (not current) in its periodic reporting obligations (i.e., in its quarterly and annual reports), or if it is an OTC Markets Pink Sheet quoted company, it may be delinquent in its Pink Sheet reporting obligations, which may result in OTC Markets posting a negative legend pertaining to the Profiled Issuer at www.otcmarkets.com, as follows: (i) “Limited Information” for companies with financial reporting problems, economic distress, or that are unwilling to file required reports with the Pink Sheets; (ii) “No Information,” which characterizes companies that are unable or unwilling to provide any disclosure to the public markets, to the SEC or the Pink Sheets; and (iii) “Caveat Emptor,” signifying buyers should be aware that there is a public interest concern associated with a company’s illegal spam campaign, questionable stock promotion, known investigation of a company’s fraudulent activity or its insiders, regulatory suspensions or disruptive corporate actions. If the Information states that a Profiled Issuer’s securities are consistent with the future economic trends or even if your independent research indicates that, you should be aware that economic trends have their own limitations, including: (a) that economic trends or predictions may be speculative; (b) consumers, producers, investors, borrowers, lenders and government may react in unforeseen ways and be affected by behavioral biases that we are unable to predict; (c) human and social factors may outweigh future economic trends that we state may or will occur; (d) clear cut economic predictions have their limitations in that they do not account for the fundamental uncertainty in economic life, as well as ordinary life; (e) economic trends may be disrupted by sudden jumps, disruptions or other factors that are not accounted for in economic trends analysis; in other words, past or present data predicting future economic trends may become irrelevant in light of new circumstances and situations in which uncertainty becomes reality rather than predicted economic outcome; or (f) if the trend predicted involves a single result, it ignores other scenarios that may be crucial to make a decision in the event of unknown contingencies. The Information is presented only as a brief snapshot of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities. You should consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.govwww.sec.gov, www.otcmarkets.com or other electronic media, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the OTCMarkets.com; (c) obtaining and reviewing publicly available information contained in commonly known search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.org. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and the OTC Markets and/or have negative legends and designations at otcmarkets.com. What we were paid to advertise the Profiled Issuers. The details of our compensation and the period of the Campaign is set forth below.
  • Name of Issuer & Ticker Symbol - Banxa Holdings Inc. (BNXAF)
  • Amount & Form of Compensation - $300,000.00 in Common Stock
  • Who Paid for the Campaign & Position with Company if any - Banxa Holdings Inc. (BNXAF)
  • Period of Campaign - 06/02/2021 - 06/02/2022
What securities of the Profiled Issuers do we hold? The positions we hold of the Profiled Issuer are set forth below. We plan to sell these securities during the Campaign.
  • Name of Issuer & Ticker Symbol - Banxa Holdings Inc. (BNXAF)
  • Number of Shares We or our Affiliates Hold - 89,633
  • Price We Paid Per Share - $0
  • Date Issued - 05/13/2021

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