Abbax Technologies: Ethereum Unleashed

Notes from April 6th Investor Call

Buenos Dias,

Lets start off with some quick disclosure: I just hit nice Mandarin Cookies pre-roll, those cookie strains are beautiful. That and Abbax that has me:

Abbax, $ABXXF / $ABXX.NE is one of the newer holdings of mine. A position I started building in January, and have made overweight since then.

This presentation helped me in better understanding Abbax Technologies and assisted in allowing me to gain a better comprehension of the utility of the Abaxx exchange. This was my 2nd time taking down notes in earnest during a presentation/call so its choppy at times. Anything in italics has been made so to signal that it is original material from the notes on my word doc. Anything in regular print below is my commentary and further notes from recall as I type this now at 5pm today. The call was moderated by Catherine Flax who is an Abaxx ESG Advisor. She introduced Robert and Josh and drove discussion asking questions on what it is abaxx does, the problems it believes it can solve, and how big of an opportunity this company has in the capital markets.

Robert friedland->

Mining is living in a place where there is no where to hide, need to be getting along with the local people you operate in. Scrutiny of supply chain.

Robert lives in Singapore, his introduction cited him being a big part of two prior revolutions in the mining world, by being able to anticipate the change coming. He is an Angel Investor in Abaxx. I notice that I started off slow in notes, missing live points from it, got caught listening and being passive. Robert believes their is a seismic change coming for the energy and mining industry and thus the markets they participate in and pricing of the extracted energy and metals that come from said mining. I need to learn more about Robert.

Josh Crumb->

Mining engineer- worked in Canadian capital markets, worked at goldman sachs, head of metals strategy out of London. Got to know the commodities futures markets, got to know how to trade and manage risk.

Considers himself a builder back in Canada. Technology meets the metal and energy market.

Lots of experience in building commodities markets from the ground up and trading futures markets.

Much better notes here on bio Luke well done bud. Josh is the CEO of Abaxx Technologies. He seems proud to be from Canada and I loved seeing and feeling that. Continued notes below after what was a follow up question to Josh after his introduction. Question centered around where the energy market was going.

1 year ago everything changed-> was before covid, was at goldman sachs global macro conference, quiet convo with jeff currie, jeff said things are different this time. Extractive industries are going to have to change for real this time.

global energy transition, liquified natural gas, growth of carbon offset markets. LNG trading desk merging. Developing standards in the carbon and carbon offset markets.

Call to action to Canadian capital markets to lead the way in energy transition, carbon offset markets going to 20x.

It goes back to Robert here with the same question. Robert liked talking with anecdotes and stories, I enjoyed listening to him but also when I hear that it puts my guard up as well. I think this Robert just been in the game so long, seen, and been a part of so much. He has 100% conviction in Abaxx and enjoyed being colourful on the call. Robert Focuses a lot on China and their plan for Carbon Neutrality by 2060.

Robert friedland

Automobile supply chain-> hydrocarbon biggest market -> LNG is transition fuel -> to renewable energy.

Here Robert is emphasizing that the shift to renewable energy from hydrocarbon isnt happening in a flick of a switch. Liquified Natural Gas is going to have a sizeable place in the energy market. This is what Abaxx is primarily going after. The LNG commodities and futures market. He is also speaking about the electrification of energy and what that means for the auto industry and consequentially the miners of those metals/materials.

Certain commodities are linked to their ESG properties.

Battery metal supply chain that isn’t transparently priced -> need a market that can capitalize all this infrastructure. 17 trillion needed to invest in commodity infrastructure. No forward hedging markets for these new battery metals. This is what abaxx is focused on.

Business model: LNG and carbon -> 500 million rev for CME group that owns the WTI contracts.

Here he is giving context to the potential scale and rev that Abaxx could achieve being the runner of the blockchain for these LNG contracts. CME group is in the oil markets and is bringing in 500 Mil in rev a year as per Robert’s comment.

Voluntary Carbon 2.0 -> companies are transitioning strategically, stakeholders want to see this. Government will also tax carbon, and carbon credits.

6 or 7 elements that are huge winners from the periodic table. Cobalt.

Tertiary implication on raw material demand is in the early stage.

Own the market-> everyone is coming to you, Asian space looking for forward markets. Get a bit outta every trade, Singapore getting hot. Intelligent area and well run. Buying into theme of disruptive markets. Blockchain can track every single commodity and follow its ESG characteristics. Trading credits requires flexible technology (ABXX).

Timezone -> Asian markets making it.

Singapore port one of the biggest in the world

These comments were provided after being asked a question regarding whether the energy market is ready and in need of the technology Abaxx is offering. Is there Utility yet for Abaxx. Robert says a couple times that the Abaxx Exchange’s goal is to be the main market for trading these commodities. Bring everyone to you and make money off of each transaction, there is a drive by shareholders, companies, governments to transition to carbon neutral energy. Josh answers the same question below.

Josh -> real step change, French government last year veto’ing a contract with two businesses in western countries due to methane pollution

Methane pollution created in the gulf of Mexico, no mentioned of which two companies.

China 2060 carbon neutral goals-> biggest economy.

Microsoft-> 2012, started investing in nature based solutions to create their carbon offsets. Carbon negative by 2030. Offset their carbon.

Plans in Singapore question from moderator to Josh:

·         Abaxx co -> the tech

·         Abaxx exchange -> the regulatory clearing part. Operations and real soul of the company is in Singapore, but we are in Canadian capital markets

Here Josh was breaking down Abaxx, Speaking to other big examples of how the world is ready for this shift as its already happening on a Government and Corporate level.

Robert-> connection to Josh and abaxx question

·         China never fails to execute their 5 year plan.

Mentions the china plan to be carbon neutral by 2060.

Need a smart market to put this all together

Ethereum ready to make it happen with government that is ready to make it happen in Singapore with monetary policy.

Im seeing a pattern here in my notes and I can recall it looking back on yesterday. When Robert was talking I was more interested in just taking everything in this guy was saying. He speaks with his hands a lot and was dynamic. It was after midnight I believe during this call in Singapore and Robert was jacked up to speak on the future of Abaxx and I was here for it. From what I can recall Robert’s son went to a top notch mining school with Josh in Colorado. They met during those years and have stayed connected.

Robert Lives in Singapore and firmly believes that China and Southeast Asia are going to be leaders in economic growth in the future. They are driving the pursuit of these forward and smarter markets and ready to embrace the technology he believes. The Singapore government has been very accommodative. He speaks on Singapore being a place where the world comes together through trade. They have one of the largest ports in the world. Being a prior British Colony, A country whose people can speak English, but are predominately Chinese.

Update and overview for project on launch:

3 areas they focus on-> commercial engagement of the market, commercial standards, get it ready to trade, difficult process, “over 100 firms ready to trade second.” Working to get first companies ready to trade. In the 90th percentile there. Getting close

This was Josh Answering a question from Catherine on where the company was at with its timelines and launch of the Abaxx Exchange. He stressed that their is considerable interest in the exchange, but some hesitancy to be the first to confirm they will trade on the Exchange. The exchange will allow for the smarter trading of these said companies energy they own, the exchange will be able to offer dynamic futures options as well and eventually the scope of trading will increase to more than energy but also rare earth metals and metals that are going to be of high value in the electrification of energy.

Technology piece: blockchain, always will be under development, using Nasdaq, 90th percentile. 22 million invested to date, most into tech.

90th percentile is making a statement on how close they are to being at the finish line totally.

Regulatory -> approval in principal-> last piece is the clearing house license. More difficult to get, but more valuable long-term. Working towards all three areas coming together here in Q2, a lot to connect here and want to get it right. Internally ready in Q2, with a launch this summer. Everything looks to be on track.

Question on Assets:

Plans on assets from new millennium iron-> the merger to bring abaxx to the market-> record iron ore prices. New ways to study their deposit in green steel and closer supply chains.

Iron ore to steel is responsible for 9% of global warming. 800 million in Iron Ore.

For context, Abaxx was brought public via a reverse merger with New Millenium $NML, it was an iron ore mining company. The announcement of intent to do so came in mid sept 2020. And closed a couple months later. Abaxx started trading on the NEO exchange Dec 18th. Abaxx does not carry the purported value (800 million) of the Iron Ore on its balance sheet that it owns through the reverse merger with NML. Josh continues on below on the company

ESG has accelerated more in 12 months than ever before. LNG is a very attractive alternative, LNG is an enormous market. Interest in Singapore.

NFT used to create contracts-> swing out the tech -> josh sees marketplaces

Wrote patents on NFTs 3 years ago. Blockchain is the timestamp that no one can change, proof that you own something. Company is exploring other markets to scale the tech and create value for shareholders. Want to first gain credibility.

25-30 million spent in investment, 10 million in clearing house. Focused on commercial users using their market. Traders will come. 12 months out profitability not the focus.

Josh has extensive experience in the NFT industry, He and his team have been working and utilizing it for years. He stresses the understanding and application of technology is a strength of Abaxx’s. He also gives guidance that the goal isn’t being profitable in a year. Abaxx’s goal is to be the exchange of the future. Its going to take some time to see it start to be realized.

Question from Catherine on How is Abaxx courting future institutions to use this exchange:

build a critical mass. Gamechanger for the company is the lng / esg. 100 companies interested atm.

Precious metals and battery metals trading contracts in 2022. Gold they looked first, solve a problem with their expertise. Largest metals market, very different contract, warehouse receipts, where its in place. Nickel markets as well they are targeting, speaking with largest trader of nickel this past week. 2022 battery metals.

Josh doesn’t get too specific here in mentioning companies and going into details and speaks more to the markets they are targeting and where growth can come from years down the road. The company is first targeting the LNG markets, but their exchange is flexible and smart enough to do more. He then speaks on another application the company is building using blockchain tech as a way to offer further value to their users. ID++

ID++ -> identity protocol, more secure version of docusign. Working on open protocols. Building protocol on signatures, build an ecosystem for signatures. Verification of these offsets is going to be difficult. Need to utilize blockchain. Working on bringing everything together.

From what I know about ID++ and gather from the call it can be leveraged on their exchange + be an offering for secure signatures online and enter the same space as Docusign. The product is still being developed and scheduled for completion in the back half of this year.

Catherine asks an Capital uplisting question to Josh:

can upgrade to the QX -> now that they have finally had a year in business. Nasdaq is coming and Singapore exchange. 2050 -> economies need to change. The ability to track everything. Singapore brings the world together.

Josh starts by saying that he can not speak a lot on this for legal reasons. Encourages investors to see the company’s AIF and disclosure documents. He does say that now that the company has filings FYE financials the company is eligible to uplist to the QX (from the QB) OTC market, the last step before a senior exchange listing in the US capital markets. Currently I’m not concerned with a listing on the Nasdaq. I want to see the company get its license to be a clearing house operator. That is the last piece of the puzzle from a regulatory perspective that is needed. The tech needs to be finalized, and I’m hoping to get a little more colour on the companies interested in trading on the exchange, maybe this will come much closer to launch. QX uplisting seems a likelihood in Q2 so that should provide greater liquidity to the holding. I share the chart enough on twitter but I’ll fire it up here for anyone who isn’t following along.

Abaxx has just recently cleared the AVWAP off the high set in late December. I have called it out that I was to see this become support after being resistance. Abaxx is still a pre-rev company and as you can see it hasnt been very liquid until late (lotta buying) But we did have a full red candle today on above average volume so I would wait to see how the price action behaves around this 3.30 range on the ABXXF ticker, $4.20 range on the NEO, where I own it. I need to use ABXXF here as the foreign markets were open on the 28th of december (the high for the stock) CDN markets were closed in lieu of boxing day which was on a weekend.

If we see the AVWAPs trend down that could signal a downside move before pushing up. I would expect to find support off the AVWAP from the low of the base that I have selected before the push up. Again this is a pre-rev company so position size should be managed accordingly.

I hope these notes and my further commentary on them provided you with some insight into what Abaxx Technologies it is Abaxx is working to accomplish- which to me is the future marketplace for renewable/sustainable energy trading, one that can make sense of and price in all the intricacies that come with these energy sources and raw materials/metals (carbon credits/ESG evaluations/demand&supply for futures. All of it powered by Ethereum on the blockchain. I believe in Josh and his mission. Josh Calls on Canadian capital markets to be a part of this journey and growth and to be a leader in the energy transition. I like that he has a good amount of skin in the game with the company. And I love that the company is proud of its Canadian Identity.

I certainly missed some points in this piece so I encourage you to watch the full call that is posted to Abaxx’s twitter account. To easily access it this moment, here it is:

Disclosure: I own shares of Abaxx, I am bullish on Abaxx. I am not getting paid for this post. This stack is a notes piece with commentary and not exhaustive DD on Abaxx, there are some great reads on Abaxx Technologies on Seeking Alpha that help break down the company further. Please do DD before buying.

All the Best,

Luke