Dear Eximchain community,
Thank you for all your kind support in the past few years. Eximchain was founded with a vision to transform global supply chains with blockchain technology. Since we embarked on our project, we have acknowledged that realising our vision would be a long-term endeavour. Supply chain systems and practices have developed over decades and transforming them will not happen overnight. But the team has given the best effort to build enterprise-ready infrastructure and design solutions that can help businesses in the global supply chain. Since we launched our token sale back in early 2018, Eximchain has completed the development of Eximchain Mainnet, Quadratic-Voting Based Governance Mechanism, DappBot and the design of POCs for supply chain businesses. Earlier this year we announced the launch of Smart Supply Chain solutions looking for business adoptions. However it has been a challenging year for us given the outbreak of COVID-19 since the beginning of this year as for many other businesses. We regret to inform you that Eximchain Network has to conclude development after the team giving the best effort. Funding has been depleted mainly for the following reasons:
Decline in ETH Market Price
During our initial token sale back in early 2018, we announced that USD 841.11/ETH would be the accepted exchange rate for token sale based on Close Price under “Historical data for Ethereum” from Feb 2nd to Feb 6th on https://coinmarketcap.com/. However, after completing the KYC process and closing the token sale by March 30 2018, the price was dropped to around USD 394/ETH hence the monetary value we received was less than half of our initial target. Given the market situation, we immediately sought help on treasury management from professionals, however the market never recovered to the same level when we conducted the token sale.
In addition, to pay for the infrastructure cost for Eximchain Mainnet and ongoing operational cost in fiat, we had to constantly cash out ETH with a much lower price compared to the USD 841.11/ETH we accepted during token sale.Taking our network cost as an example, by the time of Eximchian Mainnet launch, we had gone through rounds of trial with testnet including 250 machines across 14 regions globally on AWS. Noticing the changes on our future budget, we had taken actions to downsize the network while maintaining network security. However, as described in our whitepaper, the design of Quadratic-Voting Based Governance Mechanism requires majority nodes to be held and run by Eximchain at the beginning hence we had to sell ETH at a small percentage of the price we accepted through token sale in order to meet the month-to-month payment in fiat. Besides the monthly recurring AWS cost, which was reaching around SGD 80K at the highest point between 2018 and 2019, the rest of the funds raised during token sale were spent as Network & Product Development, Legal & Professional, Sales & Marketing, as well as other Operational Costs. The loss due to decline in ETH price greatly limited our ability to expand business operations and marketing effort while keeping the Eximchain Network development and maintenance.
Slow in Supply Chain Business Adoption
Even long before the Eximchain mainnet launch, we have started contacting hundreds of businesses trying to establish partnerships and looking for potential adoptions. We have used our best efforts and connections to push for introductions, meetings and deals under limited budget and resources. The adoption cycle for B2B is expected to be much longer than a consumer product, and that timeline increases significantly when we’re talking about applying a new technology in one of the most traditional business fields in the world. There have been cases where we received verbal confirmation from senior managers after 6 months of pitch but couldn’t push forward due to collaboration issues across different departments, where we designed and developed the full solutions based on clients’ requirements but they chose not to adopt due to change of strategy, where we signed agreements under NDA but not allowed to talk about the partnership in public.
This year we launched the Smart Supply Chain initiative aiming to give a strong push for adoption and generate sustainable revenue to support the network and operational costs. We managed to be selected as one of the five global finalists to attend the Visa Everywhere Initiative 2020 and we also successfully entered into a contract with a client in the supply chain space who was looking for long-term collaboration. However, due to the impact of COVID-19, the client had to terminate the contract early only after one month of development in September.
We are disappointed that Eximchain was unable to achieve the vision we had in mind. It was not for a lack of effort or desire. For the long-term vision of the project, the team has not taken any of the Team Token that we’re entitled to based on the whitepaper. Since earlier this year when COVID-19 started to impact global economics, the entire Eximchain team has not been paid with any salary in order to try to get through the crisis even when one of our key members was in a bad health situation. COVID-19 has stretched the team’s finances and resources to the limit. With such depletion and no other revenue forthcoming, we have no choice but to come to this difficult decision.
With this, we thank all our token holders and partners who have supported our vision, and for those who have participated in our governance voting to become a master node. We will be shutting down all the nodes and the blockexplorer that Eximchain is currently hosting for the network by November 6 2020 and after that Eximchain will no longer be controlling the network. The existing master nodes that are not run by Eximchain can choose to keep supporting the network by running nodes on their own servers. You will still be able to download the Eximchain wallet and access the blockexplorer before November 6 2020. The network will be completely down when no node is processing transactions. We will also be closing all official public communication channels by November 13 2020.
The remaining assets of Eximchain will be used to pay outstanding expenses with external service/software providers to the best of its ability after settling lawful expenditures according to section 203 of the Insolvency, Restructuring and Dissolution Act 2018. We regret that we are unable to issue a refund for any purchase of Eximchain tokens. We would also note again that Eximchain designed the Eximchain tokens solely for the purpose of supporting the Eximchain Network and not for investment, speculative or other financial purposes as we presented in EXC Token Sale Terms and Conditions that governed the official purchase of Eximchain tokens.
We would not have achieved all that we did without the support of the Eximchain community. We thank you again for believing in us. We have dedicated all our passion, effort and resources in the past few years and are taking in the sad result together with you.
Although we are only able to lead Eximchain Network this far, if anyone, whether within the Eximchain community or otherwise, with the necessary funding support is interested to lead the Eximchain Network development beyond Eximchain’s closure, please do reach out to hello@eximchain.com by November 13 2020 to discuss.
Thank you and best wishes,
Eximchain Team
