Liquid Meta Capital Holdings Ltd. (“Liquid Meta” or the “Company“) (NEO: LIQD) (FRANKFURT: N5F) (OTCQB: LIQQF) a decentralized finance infrastructure and technology company focused on bridging the gap between traditional and decentralized finance, today announced its financial results for the three-months ending November 30, 2022.
All dollar figures are in United States dollars (“USD”), unless otherwise stated.
Q2 2023 Highlights
- Total Reward Tokens and Trading Fee revenues of $326,738 for the three months ended November 30, 2022.
- Realized and unrealized loss of $1,010,789 for three-months ended November 30, 2022, due in a large part to short positions on FTX that were inaccessible during a period of significant volatility leaving long positions outside of FTX exposed.
- Quarterly net revenues excluding FTX exposure of $(719,758).
- Net operating loss of $1,696,777 resulting in net loss of $5,609,376, with $3,912,599 (net exposure) due to the collapse of the second largest crypto currency exchange FTX.
- Net loss per share of $0.10.
- Total Shareholders’ Equity of approximately US$15.4 M (CAD$20.8 M) or US$0.29 (CAD$0.39) per share
- Deployed capital across 10 blockchains, 26 different decentralized platforms and 5 different strategies
- Additional details on FTX Bankruptcy impact on Liquid Meta
- On November 11, 2022, the company’s founder and CEO stepped down from the company and FTX had filed for bankruptcy.
- Liquid Meta had $4.9 M in total deposits on the FTX platform at the time of the ‘bank-run’. The company was unable to withdraw its deposits ahead of the halting of activity on the exchange and subsequent bankruptcy.
- Net exposure to FTX was $3.9 M
- Liquid Meta is exploring all options to have any of its funds returned as part of the FTX bankruptcy process and will update investors on any developments.
- At the end of Q2 Liquid Meta had exited most of its positions in DeFi, had no material exposure to any Centralized Exchanges (CEX’s) and had moved most of its balance sheet to a traditional financial institution until management is comfortable to redeploy its fiat holdings back into DeFi.
- Subsequent to quarter end, the company announced that its Board of Directors had initiated a process to evaluate potential strategic alternatives to maximize shareholder value. As part of the process, the Board will consider a range of options that may include, but are not limited to, a sale, merger, divestiture, return of capital, other strategic transactions, or continuing to operate as an independent public company.
“The operating environment in crypto year-to-date has been the most challenging for the industry since its inception. Crypto and DeFi markets have been exposed to a global macro environment that has resulted in a ‘risk-off’ backdrop due to rising inflation and higher interest rates globally. The war in Ukraine, the lingering effects of continued pandemic lockdowns in China and less than ideal fiscal policies set by central banks have all contributed to the industry’s difficulties during 2022. More specifically, security issues in crypto / DeFi and the collapse of several Centralized Crypto trading platforms like FTX has resulted in a fundamentally challenged operating environment” said Jonathan Wiesblatt, CEO of Liquid Meta. “However, with all the negative headwinds facing the industry we still believe that products and services offered in crypto are not only going to continue to grow but will become more vital to the global financial ecosystem in the future. Decentralized applications have continued to outperform its counterparts in Centralized Finance (CeFi) given the consistent performance of the smart contracts, the open and transparent nature of all transactions and the removal of human subjectivity in financial transaction decisions” added Mr. Wiesblatt.
Liquid Meta is a DeFi focused infrastructure and technology company. The Company had a liquidity mining operation where it generated returns through deployment of its own balance sheet on a variety of blockchains and decentralized applications. The Company was also developing technology to bridge the gap between traditional finance and the emerging open financial protocols being built in Web3 and has paused this activity as part of its strategic review process. This technology is designed to make on-chain operations simpler, safer, and more efficient for traditional financial institutions to access Web3.
Financial Statements and MD&A
Liquid Meta’s financial Statements for the quarter ended November 30, 2022 and Management’s Discussion and Analysis (the “MD&A”) for the three months ended November 30, 2022 are available on SEDAR at www.sedar.com.
About Liquid Meta
Liquid Meta is a decentralized finance infrastructure and technology company that is powering the next generation of open-access protocols and applications. The Company is creating the bridge between traditional and decentralized finance while ushering in a new era of financial infrastructure that benefits anyone, anywhere.
