Here is a copy of our Cryptonomex Annual Report for 2020, posted here to reach those shareholders who have not kept their emails with us current. You can update our email records by responding to [email protected].
2020 Annual Report
CEO’s Letter to Shareholders
Cryptonomex® and its shareholders had a very good year in 2020. At a total net cost of less than $22K, we added another pair of new promising spinoff companies to our original Steemit spinoff of 2016. These include Goldback and Karat Swap. Most of this was accomplished by a small team working for equity in these spinoffs, with just a bit of aid from Cryptonomex.
Before going into more detail, let’s recap how Cryptonomex has evolved since the beginning.
The Evolution of Cryptonomex
Cryptonomex® was founded in June 2015 to develop a new blockchain technology called Graphene™ and quickly achieved its primary goal of enabling the BitShares community to upgrade to BitShares 2.0 – the world’s first real-time, industrial grade blockchain. The number of third party manned and unmanned businesses this has spawned since then is a testimony to the robustness and popularity of the technology.
The next imperative became to raise funding to pursue a multitude of potential products and services based on this technology. However, after talking with potential investors for the remainder of 2015, it became clear that most were more interested in doing Joint Ventures with Cryptonomex than investing in Cryptonomex itself. The perception was that they could gain a bigger share of the pie that way than merging their investment with other investors pursuing multiple projects, most of which were still loosely defined.
So, we adopted the joint venture spinoff model and focused on defining narrowly focused business models that could be spun off as separate companies for the benefit of Cryptonomex shareholders.
The first such company was Steemit, Inc., created in March 2016 to develop a social media blockchain and profit from a new website at steemit.com. The entire engineering team transferred to the new company to work on Steemit and Cryptonomex shareholders were directly given 50% of the shares in Steemit. Steemit quickly became a success, validating the joint venture spinoff model.
The administrative and business development members of Cryptonomex remained with Cryptonomex, conserving its modest remaining resources by working on a commission-plus-expenses basis. Their objective is to find other partners interested in replicating the Steemit success. The primary strategy was to promote BitShares and the role of Cryptonomex as its primary advocate, while helping potential partners define their business plans and pursue funding.
We continued to follow this strategy in 2019, and engaged new partners willing to do the legwork of forming joint ventures, aiming to do one or more Steemit-style spinoffs in 2020. Cryptonomex had very little earnings or expenses in 2020 while we waited for our startups to start earning revenue. The company was essentially dormant with the exception of the efforts of a small team of free lance business developers.
Nevertheless, here’s what we accomplished.
The Class of 2020
Cryptonomex now owns pieces of six joint venture spinoffs two of which were closed in 2020 as two new ones were opened
Heronomex was a Wyoming LLC joint venture with Sovereign Hero resulting in the SovereignHero.com and BillionHeroCampaign.com. The mission of this company was to attract a massive following from outside the digital currency industry and train them on how to use the BitShares ecosystem and to advance a wide range of philanthropic activities. The primary benefit to Cryptonomex shareholders is acquisition, training, and retention of new users for the BitShares platform. This BillionHeroCampaign is on hold and mothballed due to lack of funds and a downturn in the price of BitShares. Heronomex does own 25% of Hypernomex which owns half of Quintric. We closed Heronomex in 2020 and passed its shares of Hypernomex on to be held by Cryptonomex directly. This is more tax efficient than passing future income through Heronomex.
Hypernomex, formerly called Hyperion Ventures, is a Joint Venture between Heronomex and Hyperion Associates to develop the Hyperion Hero Hub, which is a generalization of the BillionHeroCampaign.com customer support services. Whereas Heronomex was to become a not-for-profit organization for attracting new individual users, Hypernomex targets the acquisition of new industrial users for the BitShares platform, providing them with best-in-class integration support via its BitShares Enterprise Alliance. The primary benefit to Cryptonomex shareholders is ownership of 25% of the Joint Venture. Hypernomex paid Cryptonomex $4726.61 dollars as its share of profits from a new Quintric spinoff called Goldback.
Quintric is a Joint Venture between Hypernomex and the United Precious Metals Association (UPMA) located in Salt Lake City, Utah. UPMA successfully lobbied the state legislature to recognize gold as legal tender in the state. This has significant advantages for creating a gold backed digital token, the Quint, that may also be recognizable as legal tender. Quintric envisions an entire family of commodity backed tokens, all rigorously compliant with the global regulatory environment. The primary benefit to Cryptonomex shareholders is ownership of 12.5% of this Joint Venture via ownership of Hypernomex. Quintric growth was delayed by a year due to an SEC investigation which resulted in a clean bill of health, but cost us momentum. We expect Quintric to begin earning a profit in 2021.
Goldback notes from Goldback.com – a Quintric spinoff.
Goldback.com. The creation of the Goldback relies on 5th generation vacuum deposition technology. The designs are printed on a sheet of polymer that is then bombarded with the correct amount of atomized gold particles in a vacuum chamber. This gold is then sealed inside by a second protective barrier of polymer, thus creating a beautiful negative image. Valaurum has been developing the process for nearly two decades and it has never been counterfeited. It is truly the most technologically advanced process for creating a physical gold money in the world today. Cryptonomex owns a fraction of a percent of Goldback via it's ownership in Hypernomex and Quintric and provides the digital token GLDB backed by Goldbacks on the BitShares network.
Terradacs, Ltd. was a Malta based company which developed the new BitShares EOS (BEOS) project. BEOS.world serves as a middle chain between BitShares and EOS. Cryptonomex acquired 10% of Terradacs. With the death of CEO Paul Martello, we elected to close Terradacs and transferred the IP to BLCA Limited Cooperative Association and its BECO non-profit subsidiary which operates BEOS for 100 Million BEOS. 9 Million BEOS were transferred to Cryptonomex (10% of the BLCA paid license fee after termination expenses).
Karat Swap LLC. Our newest company started in late 2020 is Karat Swap, another Wyoming LLC that we will be raising funds for in late summer 2021. Karat Swap has a deal with hundreds of big-name brands to allow people to use a cell phone app to make their purchases on their credit cards and earn 10-20% discounts stored in the apps built-in wallet as GLDB tokens redeemable for Goldback currency notes. The app allows users to swap these for other leading crypto currencies including Bitcoin, Ethereum, EOS, BitShares, Quint and BEOS. We think this will attract many people to cryptocurrency who otherwise would not be able to afford to buy it. Cryptonomex will own about 20% of the KaratSwap company.
So Cryptonomex has become a holding company for shares in these other companies. We plan to continue working to make more such deals while we await income from these joint ventures.
Stan Larimer, Director and CEO
Cryptonomex, Inc.
2020 Cryptonomex, Inc. Annual Report
as reported to
The Commonwealth of Virginia
and
The State of Delaware
Corporation Name Cryptonomex, Inc
Date of Incorporation June 4, 2015
State of Incorporation Delaware
Virginia County of Registration Montgomery
Principle Place of Business PO Box 794, Floyd, VA 24091
Delaware Registered Agent The Company Corporation
2711 Centerville Road, STE 400
Wilmington DE 19808
Virginia Registered Agent Jeffrey K. Mitchell
1700 Kraft Drive, STE 2000
Blacksburg, VA 24060
Cryptonomex, Inc. Principle Officers
Stanley J. Larimer
Chief Executive Officer
Michael Taggart
President
Pamela J. Larimer
Secretary/Treasurer
Cryptonomex, Inc. Directors Stanley J. Larimer, Michael Taggert
Authorized Stock: Common
Begin Date: June 4, 2015
Number of Shares: 1,000,000
Par Value .001
Number of Shares Issued: 192,050