Dmitry Suschov. Mining in chain

Thank you very much. My name is Dmitry Suschov. I invest in mining projects, primarily in the exploration stage. So I take the exploration risk and then take the projects to feasibility study and ultimately to production. So, in terms of my background, one of the first deals I made in mining space was in industrial minerals. I sold top quality silica sand miner and silicon carbide production which was the second largest globally after Saint-Gobain, French conglomerate. I sold it to Carborundum Universal, the company which is public listed in India, a part of Murugappa Group. And then I was in different mining projects, in particular, recently in PCI (pulverized coal injection) coal, where I built a relatively large producer started production in 2011 and then gradually developed quite a substantial global market share selling across Europe, Asia and even up to Brazil. And now I am entirely focused on PGM (platinum group metals) and base metals projects. So I put the first project to production in 2016, which started as a joint venture with AngloAmerican, the largest platinum producer globally. They started the joint venture in 1999. Then I bought out English share in 2014. And in 2016 I put this project into production. And I'm taking the production with the project which has Sinosteel, the state-owned enterprise from China, as a partner.

Blockchain is definitely a very important technology across different industries. And that's, for sure, the future of the Internet. Internet is developing in cycles. And we are in a new decentralization cycle. So the Internet will be more decentralized. And this is definitely benefiting everybody. And, as far as the application of blockchain technology in mining is concerned, we have a number of applications. One, that is quite a major one, is related to traceability. We had a very good presentation on cobalt today regarding traceability of the origin, of where the cobalt is coming from. It's like tracing your own DNA. So you know where it's coming from. And that's very important for the consumers. Because companies like Tesla and others are really concerned about where the raw material is coming from, whether it was legally and ethically mined. So that's where blockchain comes into play. So you can trace down to the particular mine. Also, what I think is very important, is that blockchain allows you to have investment instruments that are metal backed. It is very important. You have a number of derivatives nowadays, like ETFs for gold, etc., that allow you to invest in particular metals without actually having to physically store them. At the same time, those instruments are not metal backed. Like ETFs, they are pure paper products. So you are wondering where your metal is. It might not exist. So what blockchain allows is to issue tokens that are 100% metal backed. And that's what we are doing in the PGM space now and platinum, in particular. Because there are not so many instruments to invest in platinum bars, for example. And when a private investor wants to buy a platinum bar, he needs to pay a much higher price over London. Though a producer, like me, is selling the product with a discount in London. So this is a big margin staying with intermediaries. So we're addressing this margin. Plus we are reducing transaction cost and storage cost. So the investor just buys the token and doesn't need to store the physical product. And there are a number of banks, particularly in Japan, in South Korea, and even in Switzerland (like Swissquote) that are both trading metals and also trading crypto instruments. You just open a bank account with Swissquote. And you buy metal or you buy a token which you can physically redeem for metal at any time. So basically that allows you not to be exposed to the wallet risk, to the exchange risk. So you're shifting this risk to the bank. And at the same time it allows you not to necessarily buy physical metals and have to store it and incur storage costs and transaction costs. You can just keep the token and you can redeem it for metals at any time. At the same bank you bought the token from. So that's how it works. And that allows private investors to buy metal in very small quantities. Plus it allows crypto hedge funds to diversify their portfolios. Because there's a bunch of hedge funds that are now focused on crypto investments. And their portfolios are highly correlated (all the instruments are highly correlated) with Bitcoin. So Bitcoin goes up, the whole portfolio goes up. Bitcoin goes down, the whole portfolio goes down. So those portfolios are really not diversified. They're highly correlated. And hedge funds, by definition, need to hedge. So the token that is metal backed allows to diversify, because it's not correlated with other crypto. And that creates a hedge for this kind of hedge funds. And they are very interested in this kind of instruments.

Thank you very much. Thank you.