Investorpresentation
“Your gateway to the crypto economy”
December 2017
[ 2 ]
Message from the founders
Manuel Lains & Christian Lains
BitGate aims to bridge the gap between traditional finance and
the new, emerging blockchain-based economy. Throughout the
last three years, we have worked hard to establish BitGate as a
serious and compliant actor in a developing industry. We are
now raising funds to develop the BitGate platform and aim for
an ICO in 2018. In addition, we will host a strategy day to
provide more insights into our vision for BitGate growth in a
market being disrupted by new technology. Our platform will be
available at www.bitgate.no
“Your gateway to the crypto economy”
[ 2 ] [ 3 ]
Manuel Lains & Christian Lains
Contents
Main highlights............................................................................................................................................... [5]
Company Introduction............................................................................................................................... [7]
Platform.............................................................................................................................................................. [8]
Timing and Execution................................................................................................................................ [9]
Advantage towards peers....................................................................................................................... [12]
Market and competition........................................................................................................................... [13]
Strategy with disruptive potential...................................................................................................... [14]
Financials ......................................................................................................................................................... [16]
Vital Persons in BitGate............................................................................................................................ [17]
Partners BitGate............................................................................................................................................ [18]
Contact............................................................................................................................................................... [19]
Disclaimer......................................................................................................................................................... [19]
[ 3 ]
Blockchain Technology Overview
The bitcoin and blockchain space represents a new market, unlike anything we have ever
witnessed. The concepts explained in this business summary may be technical and hard
to grasp. Below is a short introduction to the most essential terms used in our
presentation.
Bitcoin was the first cryptocurrency designed to be used like cash online. Transactions
are made without a middle man, meaning the exchange does not pass through a
financial institution and incur any related fees. The demand for Bitcoin is growing globally
and the price has seen exponential growth from inception till the time of writing this
document.
Blockchain is the technology behind Bitcoin. It is a database that allows Bitcoin to
function without having an authority, like a bank, controlling it. Instead of an accountant
tracking transactions there is a blockchain, keeping an Excel-like spreadsheet of all the
information around the world. This information is timestamped in chronological order and
secured through cryptography so it can not be interfered with or changed.
Initial Coin Offering (ICO) is a way to raise capital. ICOs allow startups to create their own
exchange economy that allows them to bypass traditional bank and venture capital
funding. As of Q3 2017, ICO funding for tech startups has surpassed that of seed stage
and venture capital. The biggest completed ICO to date (Nov. 2017) raised more than
USD 250 million.
[ 4 ]
[ 5 ]
Main highlights
Award-Winning Norwegian Blockchain CompanyLargest and most experienced blockchain/cryptofinance company in
Norway with global partners. 20 years combined experience managing
the blockchain industry.
Norwegian Fintech Award 2017 ”Newcomer of the Year”, holding
Norway`s first successful ICO.
First ever Norwegian ICO pre-sale. In January 2017 BitGate did a minor
pre-sale and acquired twice as much capital as expected; USD 50,000
*(400,000 NOK).
Successfully hosted the world’s first CryptoFinance event, “Cryptofinance
2017” which gave the company international attention and network.
Platform Regulated by Norwegian LawRegulatory compliant platform developed under advisory supervision of
experts from the Norwegian law and banking sector.
Utilizing top grade ID verification systems i.e. BankID in Norway. Saving
time with KYC/AML procedures, facilitating trustworthy and
user-friendly onboarding.
First Mover AdvantageFirst Norwegian Bitcoin exchange platform using BankID
Mobile Bitcoin and Cryptocurrency purchasing in Norway
Blockchain-based Financial platform - First specialized Internet of
Finance application leveraging the benefits of a regulatory verification
system, permissioned & permission-less.
[ 4 ]
[ 5 ] [ 6 ]
Main highlights - continued
Customer base ready through partnershipsAround USD 120,000 *(1 million NOK) daily volume already in place,
through several partners leading the Norwegian market.
Customer base of about 1000 unique customers, through several
partners leading the Norwegian market.
Practical easy-to-use Platform SolutionsProfessional Interface designed to provide a streamlined interface
experience.
Advantage towards peers, in a market with low user friendliness.
Easy onboarding - Integrated easy-to-use wallet via global market
leader BitGo.
Low market entry costs for MVP platformLow breakeven price – estimated to break even by 2018 with
today`s cost base.
Low OPEX, even with an international customer base.
No debt as as of 4Q 2017.
Simple investment exposure to the Bitcoin and Blockchain
IndustryDisruptive potential in a strong growing market
More than 1600% Market Cap Growth last year, according to
coinmarketcap.com.
High and growing media attention
BitGate is a universal wallet and exchange for crypto assets and traditional assets. With
BitGate, users can easily hold and exchange cryptocurrencies, smartcoins and other
blockchain-based assets, as well as traditional assets, currencies and derivatives.
BitGates uses a hybrid blockchain solution to bridge the gap between traditional finance
and the blockchain-based cryptoeconomy. The hybrid blockchain incorporates both
permissioned and permissionless elements to allow for domain-specific regulatory
restrictions as well as permissionless innovation.
BitGate enables free exchange of value between anyone, anywhere in the world. BitGate
uses state of the art blockchain technology that enables secure and cost-efficient
transactions that scales to handle exchange volumes of up to 100 000 operations per
second.
BitGate AS is by 20.11.2017 owned 77% by BitSpace AS. Additionally, around 15% of the
shares are owned by members of the BitGate team. The remaining shares have been
sold to external investors through an equity dilution and from BitSpace directly.
Here is a brief summary of BitGate milestones over the 12 months:
[ 6 ] [ 7 ]
Company Introduction
2016 Fintech FactoryAccelerator Program
2017 Q1 BitGatePre-ICO Launch
2017 Q2 PlatformArchitecture,
Hiring developers
2017 Q3 Design andProduct Development
Investors
Speculators
UsersProfit
The BitGate platform enables users to store, transact and exchange a wide variety of
assets. Users can also issue custom assets with properties suited to their needs. For
example, businesses or individual users can create an asset backed by traditional assets
or create their own Smartcoins, assets backed by an autonomous smart-contract.
The hybrid blockchain platform ensures that both permissioned and permissionless
assets can co-exist on the same network. This offers individual jurisdictions and others
who wish to create restrictions get a chance to do so for individual users or assets while
the rest of the platform remains unaffected.
BitGate’s platform uses the Delegated-Proof-of-Stake (DPoS) consensus algorithm, the
most cost-effective consensus algorithm. DPoS has sub-second transfers and can
process up to 100,000 operations per second. This means that it can scale to handle
volumes comparable to Visa and the NASDAQ exchange.
[ 7 ] [ 8 ]
Blockchain Platform
As of November 2017, the BitGate essential staff is as follows:
Core team: chief executive officer, chief strategist, chief operational officer
Developer team: 3 full time, 4 part time
Marketing & design: 3 full time, 2 part time
CryptoEconomy Traditional Economy
Bridging the Gap
[ 8 ]
In the last 9 years, the market cap of Bitcoin and the crypto-economy has grown to over
USD 200 billion. Since June 2017, the funds raised by Initial Coin Offerings (ICOs) have
vastly exceeded the total funds raised by angel & VC funding (IPOs). In addition, the
underlying blockchain technology is now being explored globally by the financial
industry as a way to enhance services and cut costs. Due to several converging factors,
the timing is right both in terms of the crypto-economy, the traditional financial economy
and their intersection.
Creating wallets and managing accounts is difficult in Bitcoin and other
blockchain-based currencies. It is hard to remember your passwords and addresses
to blockchain-based wallets. Today’s solutions are not consumer friendly. If you lose
your wallet password, you lose your money.
[ 9 ]
Timing and Execution
Timing - The Crypto-economy
Setting up an account is difficult. Due to improvised implementations of KYC/AML on
various international exchanges, the user will have to submit a copy of their passport
and submit a long list of details so that the exchange can stay compliant. This is
frustrating to experienced users and prevents new users from entering the market.
The user interface in most exchanges is meant for professional traders. This is
overwhelming for most consumers. High complexity is great for expert users, but
for beginners it creates distrust and frustration.
[ 9 ] [ 10 ]
Bitcoin Core market
Timing - Traditional Financial Economy
The first delivery will be the BitGate Proof-of-Concept that will launch in Norway.
BitGate has partnered with the biggest Bitcoin trader in Norway, Bitmynt.no, giving
BitGate a majority of the daily trading volume in Norway from day one after
launch. Bitmynt.no currently has a volume of 1,000,000 NOK/day which is an
artificial cap imposed by Bitmynt’s bank provider.
Demand for Bitcoins is greater than what Bitmynt.no can provide. There is a vacuum
in the Norwegian market that the BitGate Proof-of-Concept will fill with NOK-BTC
trading. After building a NOK-BTC trading solution other cryptocurrencies will be
added such as Ethereum, Bitcoin Cash, Litecoin and Dash to trade against NOK.
The total market cap for all cryptocurrencies is currently over $200 billion USD.
Blockchains and cryptocurrencies are in their infancy and comparable to where the
Internet was around 1995.
Information technology is growing exponentially and is threatening incumbents in all
industries. The financial industry is no exception, prompting banks and financial
institutions to focus on “fintech” as a way to preempt their own disruption.
If you manage to set up a wallet and an account on a foreign exchange, learn the
interface and manage to purchase some Bitcoins, you still might be unsure of how
your government regulates them.
[ 10 ] [ 11 ]
BitGate is growing with the realization that fintech revolves around CryptoFinance, a
decentralized infrastructure for the global economy that will supplant the current
financial institutions as gravitational centers. What the Internet is doing to
information and communication technologies, the Internet of Value is expected to
do with financial technology.
The PSD2 (Revised Payment Services Directive) regulations and the trend toward
“open banking” will accelerate financial disruption. BitGate positions itself as
gateway that will connect the banks to the Internet of Finance, allowing regulated,
trusted industries to operate on an open, decentralized system.
Centralized
De-Centralized
Exchange Control Funds
Permissioned
Hack & Server Downtime
User Control Funds
Permissionless
No Hacks & Server Downtime
Norwegian Trading Volume (in NOK 1000)7000
6000
5000
4000
3000
2000
1000
02014 2015 2016 2017* excl.
Q4
Data fromlocalbitcoins.com
The business structure of BitGate has been architected in cooperation with experts
within compliance, law and the banking sector. BitGate has worked closely with Camilla
Wollan, Legal Advisor of DLA Piper; Lars Hektoen, Bank Advisor and Founder of Cultura
Bank; Lasse Meholm, Wealth Manager at DnB; Sylvia Johnsen, former Risk and
Compliance Officer in Nordea bank. BitGate’s decentralized exchange gateway is
innovative, resistant to regulatory hurdles and massively scalable.
[ 12 ]
Advantage towards peers
Product Features
IdentityBitGate uses BankID in Norway for fast and secure authentication and KYC
compliance in the Proof-of-Concept. Authentication in other countries will
be provided through local ID verification solutions.
SecurityBitGate takes care of passwords and wallet addresses in a safe way, so that
it can easily be restored and changed, should the user happen to forget
them.
Wallets used to secure funds and passwords that usually take time to
create will be handled behind the scenes of the user interface by BitGate
partner BitGo providing a secured balance that is automatically available on
your mobile phone.
ComplianceBitGate is building local relationships with banks, regulators, identity
solutions and payment solutions to ensure maximum safety for consumers.
[ 11 ]
BitGate will have low competition in the Norwegian market exchanging Bitcoin to NOK.
There are already a few actors in this market, however they all have their drawbacks. This
provides BitGate the opportunity to grab a dominant position in the market early on.
Today`s market is characterized by the following:
Hard to use, or no interface for the customer.
Unscalable manual processes capping growth potential.
Lack of professionalism and mediocre reputation.
[ 12 ]
Market and competition
[ 13 ]
Ease of UseThe UX team will design an easy to use
interface that will be tested thoroughly
on users before it is implemented to
uncover real behavior and real usability
problems.
BitGate will follow accessibility guidelines of
Universal Design to ensure that everyone
included people with disabilities will be able to
take part in the new emerging economy.
BitGate will be using adaptive user interfaces,
which means that the interface will change
based on the needs of the user. The interface will
gradually morph from beginner to expert,
aligned with the users progression and skills
within the platform.
Our solution to develop this market:
Automatic processes facilitating huge scaling potential
Lower fees for customer
Lower costs for BitGate
Clean and user friendly interface allowing fast, safe and convenient onboarding
of customers.
Strategy with disruptive potential
[ 14 ]
Our solution to develop this market:
BitGate represents a hybrid between the two Exchange types
The platform benefits from the robustness and security that follows the
decentralized nature of the blockchain.
The platform maintains high focus on the aspects of user friendliness & adoption.
Besides exchanges, the strongest competitors in the blockchain based exchange
space will consist of mainly two types of services:
Decentralized exchanges, which generally are
low on adoption
lower on user friendliness
Centralized exchanges which generally are
Vulnerable to regulatory
Vulnerable to hacking
BitGate’sblockchain solution can serve as an exchange
infrastructure for stocks and other assets. Trading stocks
and assets digitally on a blockchain is faster and more
efficient than trading within traditional systems. There
are 60 major stock exchanges in the world with a total
value of $73 trillion.
Stock exchange
2017 Q4 Design and Product Development
2018 Q1 BitGate Launch and ICO
2018 Q2 New Currency Markets and European Expansion
2018 Q3 Blockchain Development
2018 Q4 BitGateBlockchain Launch
[ 14 ] [ 15 ]
Most large companies have fully automated their
payments, but the middle-sized companies do not have
the resources to do so. With BitGate companies could
settle their payments instantly on the blockchain.
Transactions would be irreversible and automated
integrations will help save time and money.
B2B middle market for payments
Derivatives are supported by BitGate’s underlying DLT.
The low-end estimate of the scope of the derivatives
market is $650 trillion on a notional contract basis.
Derivative market
Based on todays sanctioned projects, these are BitGates milestonesfor the next period.
The foreign exchange market is the most liquid financial
market in the world. With the Bitgate’s decentralized
exchange forex trading will be possible in a faster,
cheaper and more secure way.
Forex currency trading
[ 16 ]
Financials
Income
As BitGate is in it`s infancy, there are no financial results to present, however below is a
presentation of how the funds from the Q4 2017 funding will be used,and other internal
numbers.
We will take a competitive margin off each trade on our platform. The platform can also
be used to generate other income.
Product Development
Uses of Funds from Q4 2017 In percentage
53%
Legal 16%
Marketing 5%
Design 13%
Operations 13%
Total 100%
CostsAs of November 2017, BitGate has a burn rate of around USD 30,000 *NOK 250,000 per
month. This consists of costs related to product development, legal, marketing, design
and general operations.
Debt and equityBitGate has by Q4 2017 no debt
Funding RoundBitGate AS will close a funding round in Q4 2017, selling up to 15% for a price of ~USD 61
*500,- NOK per share. Total amount of shares are 106.844 pre share issuance.
Minimum investment is ~USD 6,000 *NOK 50,000,-
[ 16 ] [ 17 ]
Vital Persons in BitGate
BitGate is a daughter company of BitSpace and has the backing of the BitSpace team and
network, collectively carrying over 20 years of experience with Bitcoin, cryptocurrencies
and blockchain technologies. BitGate has a global team of blockchain experts as well as
coders, designers, marketers, lawyers, bankers, traders and remittance service providers
all working to make BitGate happen.
Manuel LainsCo-Founder and CEO
M.Sc in Electronics from the University of Oslo, and is an experienced developer.
2 years working experience a as a blockchain consultant
BitGate Advisory Board
BitGate has, since it`s inception been working closely with advisors from both the
traditional finance sector and cryptoeconomy. These advisors are carefully chosen to
provide assistance in areas related to regulatory compliance, risk management, and
technical blockchain solutions.
Christian LainsCo-Founder and Chief Strategist
Masters degree in Philosophy from University of Oslo in philosophy.
Early advocate of blockchain technology since 2011.
Ivar DuserudChief of Operations
Economics education from Eastern Connecticut State University
2 years working experience a as a blockchain consultant
[ 17 ]
BitGate Partners
[ 18 ]
BitGate works closely with advisors on a monthly basis, facilitating a strategic edge in the
new and emerging market.
Internationally Bitgate has among others strong partnerships with BitShares and
Steem.This is also represented by key advisors and long-time community engagement in
the cryptocommunity, giving a unique position to benefit from the knowledge of the
creators behind some of the world`s most advanced blockchains. BitGate also has a
good range of local partners, making the Bitgate platform taylor-made for the domestic
market, including BankID, the Norwegian Bitcoin &Blockchain Association, Bitmynt.no,
Fintech Factory and OsloFintech.
LasseMeholm, DNB
Camilla Wollan, DLA Piper
Sylvia Johnsen, former Nordea
Fabian Schuh, ChainSquad
BjørnBjercke, former Acando Bank
Lars Hektoen, Founder Cultura Bank
Ned Scott, Steemit
Fabian Schuh, ChainSquad
SigveKvalsvik, BitShares
More info on advisory board on www.bitgate.no
[ 18 ] [ 19 ]
Contact Us
Disclaimer
For all inquiries regarding investment and collaboration please contact BitGate via
telephone or email:
This document has been prepared by BitGate AS solely for information purposes based on data supplied by
Bitmynt.no and data obtained from public sources. The information contained herein has been prepared to assist
parties who have expressed an interest in a potential transaction involving a sale and purchase of shares in the
Company to make their own assessment of an investment in the Company and does not purport to contain all
information such interested parties may desire. All interested parties should conduct their own investigation and
analysis of the Company and its operations, results of operations, financial condition and prospects. BitGate AS has
not verified the accuracy or completeness of the information contained herein and undertakes no obligation to do
so. Neither BitGate AS, the Company or its shareholder, nor any of their partners, employees or advisors, make any
representation or warranty, express or implied, as to the accuracy, completeness or correctness of this document
and the information contained herein and neither of such parties shall have any liability whatsoever for any error or
inaccuracy contained herein, or for any omissions from this document, nor for any information provided to the
recipient in connection with the recipient’s own investigation and assessment of the Company. In particular all
numbers, initial valuations and schedules contained in this document are preliminary and are for discussion
purposes only. Only those particular representations and warranties, if any, which may be agreed in a definitive
agreement with the Company and/or its shareholder will have any legal effect when, and if, executed, and subject
to such limitations and restrictions as may be specified therein. BitGate AS reserves the right to amend this
document and to correct the information contained herein at any time, but neither BitGate AS, the Company or its
shareholder undertakes an obligation to do so or to provide the recipient with access to any additional information,
even if the information contained herein is found to be incorrect, misleading or inaccurate or if any omissions from
this document is identified. This document is being furnished solely to assist the recipients in deciding whether to
proceed with a further assessment of an investment in the Company, and shall not be deemed as an offer to
purchase shares in the Company.
+47 922 88 775
Trondheimsveien 184, 0570 Oslo