ICONOMI Financial Report — Q2 2019
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Crypto blossoming came at the right time. It delivered enough green colour that gave a good incentive to the whole crypto ecosystem — from traders, investors, users to developers, regulators, builders of crypto companies, and also future stakeholders.
Motivation within the industry is really high, and that also explained why we achieved the important milestones in the past quarter. On the business level, we opened the gate so everyone could open and start managing their crypto fund. While on the company level, we got approval from the Liechtenstein financial regulator for issuing securities.
With crypto funds for everyone, we are now entering into a new era, which will bring more traffic to the platform. Financials will also benefit from it. Looking at Q2 revenues, we already see these positive movements. Our platform fees increased more than 160%, while our burn rate dropped by more than 10%.
Management fees and trading fees represent the main share of platform fees. They are both positively correlated with the number of open funds on our platform. At the end of the quarter, that number stood at 249 funds.
On the cost side, we see delayed effects from optimization coming into realization, and that will also continue into Q3 when we expect the cost to drop below the 800k range. Of course, this number is not a fixed one. Currently, we are tuning our marketing activities toward the market’s dynamics. Since the negative sentiment is disappearing, we are expecting more effect from marketing spending. Our online presence is currently focused on Facebook, Twitter, and some paid articles, while our offline strategy includes events and presentations.
Looking at our balance sheet, our book value in Q2 increased from 36 to 53.8 million USD. We partially sold positions in Thunder and Propy.
[July 31, 2019 update] ATOM tokens are still at the same address from the token generation event and have not moved since. They were not yet claimed and since our agent has not delivered them to us yet, we are using a conservative valuation — at our ATOM token position in the balance sheet, we are showing 2.222 ETH we have in an escrow account in case ATOM tokens remain inaccessible to us.
We also made a reservation of ICONOMI tokens for employee benefits and possible partnerships. Aligning the interests of employees and company on one side and preparing for possible cooperation on the other, gave us a good foundation for future growth. On the employee side, we designed the framework with lower fixed payments and a longer-term commitment. On the partnership side, we are open for discussion with everyone who might help us build our story.
Going into Q3, the main feature we recently deployed is a referral fee and a performance fee. Both combine the essential element of our user growth. We strongly believe the crypto industry is at the beginning of something really big, and that trend will translate into a substantial increase in market capitalization of crypto assets. So the performance and referral fees will give our users the best way to participate in sharing the knowledge about crypto. More importantly, we are going to help everyone on this mission.
Besides these fees, we also deployed a new onboarding flow, which additionally simplifies the first steps of using ICONOMI. In a nutshell, you can now open an account in under a minute. All steps are so intuitive that new users will get the best feeling of how smooth a crypto experience can be.
On the to-do list for the next few months is the integration of credit card payments, continuous upgrades of our trading algorithm, listing of new coins, testing the scalability and stability, and some other new features. We will also be active with issuing securities. That process will start in August. Every token holder that expressed their interest for exchange will be invited to the platform to submit a final, obligatory decision. The exchange will take place in mid-August.
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