TIDMPIRI
RNS Number : 2923H
Pires Investments PLC
02 December 2020
02 December 2020
Pires Investments plc
("Pires" or the "Company")
Investment in decentralised finance through DeTech Studio
Limited
Pires Investments plc (AIM: PIRI), the investment company
focused on next generation technology, is pleased to announce that
it has conditionally entered into a share subscription agreement
("Subscription Agreement") to subscribe for 1,765 new ordinary
shares in DeTech Studio Limited ("DeTech"), a newly incorporated
company which is developing a decentralised finance technology
platform ("YOP"). This investment will provide the Company with a
15% equity interest in DeTech.
Furthermore, in conjunction with the Subscription Agreement, the
Company has entered into a YOP Token Purchase Agreement ("YOP
Agreement") whereby the Company will also be issued with 4 million
YOP tokens, representing 4.5% of the total 88 million YOP tokens to
be issued, of which 3 million YOP tokens will be subject to lock-in
provisions. In the event that the YOP tokens to be issued pursuant
to the YOP Agreement are not delivered to the Company by 31 January
2021, the Subscription Agreement will be terminated.
Decentralised finance ("DeFi") is a fast-growing global network
of products running on the Ethereum network. DeFi provides products
for owners of cryptocurrency assets who wish to generate an
investment return from their assets. Whilst cryptocurrency coins
and tokens provide a decentralised store of value separate from any
government-backed currency, DeFi creates decentralised financial
instruments separate from traditional centralised institutions.
With the successful adoption of cryptocurrencies led by Bitcoin,
followed by the global rollout of smart contracts led by Ethereum,
DeFi represents the next phase of development of the cryptocurrency
market.
The total value locked ("TVL") into DeFi via Ethereum based
smart contracts has grown significantly, with this value growing
from less than US$1 billion in May 2020 to over US$12 billion in
November 2020. This growth has been driven by investors depositing
their cryptocurrenc y assets into smart contracts, which provide a
return via a yield paid to investors in the form of "reward
tokens". Some of these reward tokens have market valuations in
excess of US$500 million with significant liquidity. However,
currently access to this market is not straightforward due to it
being relatively technical and complex.
YOP is developing a platform that makes it easier for less
technical users to engage with DeFi. This platform is expected to
be operational in Q1 2021. YOP's primary focus is delivering access
via a smartphone app (the "App"), which should make access to and
interacting with DeFi services more straightforward and
user-friendly. As part of this process, a new YOP token will be
created, which will be issued to users to engage with the YOP
platform. The token will form the basis of the YOP protocol,
facilitating engagement with smart contracts on the Ethereum
network. Investment returns are expected to be generated through
fees from transactions and appreciation in the value of YOP
tokens.
It is expected that the YOP platform will enable portfolio
management, access to cryptocurrency market data and cryptocurrency
investment products all from the convenience of a mobile phone,
with desktop and tablet versions to follow. The Pires Directors
believe that the YOP App is akin to the platform developed by
Robinhood Markets, Inc ("Robinhood") in the US in 2013 which, at
the time, was one of the first platforms to provide easy access to
financial markets and low cost dealing, all from the convenience of
a smart phone. Robinhood now has a multi-billion dollar valuation
and is planning an IPO.
The Pires Directors believe that there is currently a limited
range of competing products, none of which are believed to offer
the potential functionality of the YOP platform and protocol.
Cryptocurrency is growing in size and profile. In particular, on
21 October 2020, PayPal Inc. ("PayPal") announced that it will
allow customers to hold and shop using cryptocurrencies at the 26
million merchants on its network. PayPal has 346 million active
accounts and processed US$222 billion in payments in the second
quarter of 2020. PayPal also said that it was working with central
banks in relation to the use of cryptocurrencies. Furthermore,
various central banks have also announced plans to create digital
versions of their own currencies. This positive outlook has further
accelerated growth and demand in DeFi platforms.
Further information on YOP can be found at https://yop.finance
.
Completion of the Subscription Agreement and the YOP Agreement
is conditional on the Company creating the appropriate
cryptocurrency wallet to receive the YOP tokens as set out in the
YOP Agreement, a further announcement in relation to the completion
of the Subscription Agreement and the YOP Agreement will be made in
due course.
There is no guarantee that the platform that is currently under
development by DeTech will be completed in a timely manner or at
all, or that the YOP tokens will increase in value nor that the
platform and/or App developed by DeTech will generate revenues or
profits.
The US$200,000 consideration for this investment and the 4
million YOP tokens will be satisfied from the existing cash
resources of Pires.
Peter Redmond, Chairman of Pires, commented:
"We are delighted to have found this new investment opportunity
that is involved in a very exciting and fast-growing market. We
believe that YOP offers opportunities for growth and could capture
a significant portion of the DeFi market . "
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 and the Directors of the
Company take responsibility for this announcement.
Enquiries:
Pires Investments plc Tel: +44 (0) 20 3368 8961
Peter Redmond, Chairman
Nicholas Lee, Director
Nominated Adviser
Cairn Financial Advisers LLP Tel: +44 (0) 20 7213 0880
Liam Murray/Ludovico Lazzaretti
Joint Broker
Peterhouse Capital Limited Tel: +44 (0) 20 7469 0935
Duncan Vasey/Lucy Williams Tel: +44 (0) 20 7469 0936
Joint Broker
Mirabaud Securities Limited Tel: +44 (0) 20 3167 7221
Peter Krens
Financial media and PR
Yellow Jersey Tel: +44 (0) 20 3004 9512
Sarah Hollins
Henry Wilkinson
Notes to Editors
About Pires Investments plc
Pires Investments plc (AIM: PIRI) is an investment company
providing investors with access to a portfolio of next generation
technology businesses with significant growth potential.
The Company is building an investment portfolio of high-tech
businesses across areas such as Artificial Intelligence ("AI"),
Internet of Things ("IoT"), Cyber Security, Machine Learning,
Augmented Reality and Virtual Reality ("AR/VR") and Big Data, which
the Board believes demonstrate evidence of traction and the
potential for exponential growth, due to increasing global demand
for development in these sectors.
For further information, visit: https://piresinvestments.com/
.
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "expect", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements re ect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors.
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