Cover
Cover - shares | 9 Months Ended | |
Oct. 31, 2021 | Nov. 30, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | Everything Blockchain, Inc. | |
Entity Central Index Key | 0001730869 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Oct. 31, 2021 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Entity Common Stock Shares Outstanding | 8,604,038 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-56142 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 82-1091922 | |
Entity Address Address Line 1 | 12574 Flagler Center Blvd | |
Entity Address Address Line 2 | Suite 101 | |
Entity Address City Or Town | Jacksonville | |
Entity Address State Or Province | FL | |
Entity Address Postal Zip Code | 32258 | |
City Area Code | 904 | |
Local Phone Number | 454-2111 | |
Entity Interactive Data Current | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Oct. 31, 2021 | Jan. 31, 2021 |
Current assets | ||
Cash | $ 1,546,000 | $ 0 |
Accounts receivable, net | 147,000 | 0 |
Interest receivable | 0 | 90,000 |
Current cryptocurrencies, net | 5,470,000 | 123,000 |
Inventory | 60,000 | 0 |
Prepaid expenses | 3,183,000 | 1,000 |
Total current assets | 10,406,000 | 214,000 |
Property, plant and equipment, net | 939,000 | 0 |
Cryptocurrency, net | 0 | 98,000 |
Goodwill | 1,319,000 | 0 |
Intangible assets, net | 7,473,000 | 0 |
Other assets | 3,000 | 0 |
Loan receivable | 0 | 1,400,000 |
Total assets | 20,140,000 | 1,712,000 |
Current liabilities | ||
Accounts payable and accrued expenses | 276,000 | 6,000 |
Accounts payable related party | 23,000 | 13,000 |
Current portion of long-term debt | 281,000 | 0 |
Reserve for legal settlements | 154,000 | 154,000 |
Deferred revenue | 88,000 | 0 |
Total current liabilities | 822,000 | 173,000 |
Long-term liabilities | 0 | |
Debt | 280,000 | 0 |
Total long-term liabilities | 280,000 | 0 |
Total liabilities | 1,102,000 | 173,000 |
Stockholders' equity | ||
Common stock, $0.0001 par value, 200,000,000 shares authorized; 8,604,038 and 5,974,125 shares issued and outstanding, as of October 31, 2021 and January 31, 2021, respectively. | 1,000 | 1,000 |
Treasury stock | (1,598,000) | 0 |
Additional paid-in capital | 67,506,000 | 54,946,000 |
Accumulated deficit | (46,871,000) | (53,408,000) |
Total stockholders' equity | 19,038,000 | 1,539,000 |
Total liabilities and stockholders' equity | 20,140,000 | 1,712,000 |
Series A Preferred Stock [Member] | ||
Stockholders' equity | ||
Series A Preferred stock, $0.0001 par value: 1,000,000 shares authorized; 200,000 shares issued and outstanding as of October 31, 2021; 150,000 shares issued and outstanding as of January 31, 2021 | 0 | 0 |
Series B Preferred Stock [Member] | ||
Stockholders' equity | ||
Series A Preferred stock, $0.0001 par value: 1,000,000 shares authorized; 200,000 shares issued and outstanding as of October 31, 2021; 150,000 shares issued and outstanding as of January 31, 2021 | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 31, 2021 | Jan. 31, 2021 |
Stockholders' equity | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200 |
Common stock, shares issued | 8,604,038 | 5,974,125 |
Common stock, shares outstanding | 8,604,038 | 5,974,125 |
Series A Preferred Stock [Member] | ||
Stockholders' equity | ||
Series A Preferred stock , par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 200,000 | 150,000 |
Series A Preferred stock, shares outstanding | 200,000 | 150,000 |
Series B Preferred Stock [Member] | ||
Stockholders' equity | ||
Series A Preferred stock , par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 400,000 | 650,000 |
Series A Preferred stock, shares outstanding | 400,000 | 650,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2021 | Oct. 31, 2020 | |
Consolidated Statements of Operations (unaudited) | ||||
Revenue from services | $ 830,000 | $ 62,000 | $ 2,216,000 | $ 62,000 |
Other revenue | 4,076,000 | 0 | 9,387,000 | 0 |
Total revenue | 4,906,000 | 62,000 | 11,603,000 | 62,000 |
Cost of sales | 723,000 | 0 | 3,469,000 | 0 |
Gross profit | 4,183,000 | 62,000 | 8,134,000 | 62,000 |
Selling, general, and administrative | 898,000 | 674,000 | 1,725,000 | 49,949,000 |
Depreciation and amortization | 40,000 | 0 | 63,000 | 0 |
Total operating expenses | 938,000 | 674,000 | 1,788,000 | 49,949,000 |
Operating income (loss) | 3,245,000 | (612,000) | 6,346,000 | (49,887,000) |
Other income (expense) | (15,000) | 472,000 | 191,000 | 481,000 |
Net income (loss) | $ 3,230,000 | $ (140,000) | $ 6,537,000 | $ (49,406,000) |
Basic and diluted income (loss) per share: | ||||
Basic income (loss) per share | $ 0.38 | $ (0.02) | $ 0.92 | $ (6.90) |
Diluted income (loss) per share | $ 0.29 | $ (0.02) | $ 0.69 | $ (6.90) |
Weighted average shares outstanding - basic | 8,552,786 | 5,872,554 | 7,074,748 | 7,156,979 |
Weighted average shares outstanding - diluted | 11,304,831 | 5,872,554 | 9,445,111 | 7,156,979 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders Equity (unaudited) - USD ($) shares in Thousands | Total | Preferred Stock [Member] | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-In Capital | Accumulated Income (Deficit) |
Balance, shares at Jan. 31, 2020 | 10,460 | |||||
Balance, amount at Jan. 31, 2020 | $ (607,000) | $ 1,000 | $ 3,501,000 | $ (4,109,000) | ||
Conversion of common to series B preferred, shares | 500 | (5,000) | ||||
Conversion of common to series B preferred, amount | (1,000) | $ (1,000) | ||||
Conversion of accounts payable, shares | 246 | |||||
Conversion of accounts payable, amount | 1,663,000 | $ 0 | $ 0 | $ 0 | 1,663,000 | 0 |
Issuance of Series A preferred, shares | 150 | |||||
Issuance of Series A preferred, amount | 40,138,000 | $ 0 | 0 | 0 | 40,138,000 | 0 |
Issuance of series B preferred, shares | 150 | |||||
Issuance of series B preferred, amount | 6,548,000 | $ 0 | 0 | 0 | 6,548,000 | 0 |
Imputed Interest | (52,000) | 0 | 0 | 0 | (52,000) | 0 |
Interest receivable - related party | 55,000 | 0 | $ 0 | 0 | 55,000 | 0 |
Stock issued for services, shares | 154 | |||||
Stock issued for services, amount | 1,038,000 | 0 | $ 0 | 0 | 1,038,000 | 0 |
Sale of assets to related party | 1,900,000 | 0 | $ 0 | 0 | 1,900,000 | 0 |
Stock issued in warrant exercise, shares | 20 | |||||
Stock issued in warrant exercise, amount | 20,000 | 0 | $ 0 | 0 | 20,000 | 0 |
Net loss | (49,406,000) | $ 0 | $ 0 | 0 | 0 | (49,406,000) |
Balance, shares at Oct. 31, 2020 | 800 | 5,880 | ||||
Balance, amount at Oct. 31, 2020 | 1,296,000 | $ 0 | $ 0 | 0 | 54,811,000 | (53,515,000) |
Balance, shares at Jan. 31, 2021 | 800 | 5,974 | ||||
Balance, amount at Jan. 31, 2021 | 1,539,000 | $ 0 | $ 1,000 | 0 | 54,946,000 | (53,408,000) |
Stock issued for services, shares | 390 | |||||
Stock issued for services, amount | 1,109,000 | 0 | $ 0 | 0 | 1,109,000 | 0 |
Net loss | 6,537,000 | 6,537,000 | ||||
Stock issued, shares | 308 | |||||
Stock issued, amount | 669,000 | 0 | $ 0 | 0 | 669,000 | 0 |
Stock issued for acquisitions, shares | 1,750 | |||||
Stock issued for acquisitions, amount | 8,642,000 | 0 | $ 0 | 0 | 8,642,000 | 0 |
Warrant exercise, shares | 182 | |||||
Warrant exercise, amount | 140,000 | $ 0 | $ 0 | 0 | 140,000 | 0 |
Issuance of Series A Preferred for services, shares | 50 | |||||
Issuance of Series A Preferred for services, amount | 2,000,000 | $ 0 | 0 | 0 | 2,000,000 | 0 |
Conversion of note receivable, shares | (250) | |||||
Conversion of note receivable, amount | (1,598,000) | $ 0 | $ 0 | (1,598,000) | 0 | 0 |
Balance, shares at Oct. 31, 2021 | 600 | 8,604 | ||||
Balance, amount at Oct. 31, 2021 | $ 19,038,000 | $ 1,000 | $ (1,598,000) | $ 67,506,000 | $ (46,871,000) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) | 9 Months Ended | |
Oct. 31, 2021 | Oct. 31, 2020 | |
Cash flows from operating activities: | ||
Net (Loss) | $ 6,537,000 | $ (49,406,000) |
Adjustments to reconcile net income (loss) to net | ||
Stock based compensation | 0 | 49,204,000 |
Reverse of bad debt | (233,000) | 0 |
Realized net gain on investment in cryptocurrency | (3,382,000) | 144,000 |
Loss on cryptocurrency impairment | 16,000 | 0 |
Fair value adjustment to cryptocurrency | (4,685,000) | |
Amortization and depreciation | 63,000 | 0 |
Imputed interest | 0 | 11,000 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (114,000) | 0 |
Interest receivable | (32,000) | (55,000) |
Inventory | (61,000) | 0 |
Prepaid expenses | (72,000) | 0 |
Other assets | (4,000) | 0 |
Accounts payable to related party | 12,000 | (23,000) |
Accrued interest | 0 | 4,000 |
Accounts payable and accrued expenses | 93,000 | (18,000) |
Reserve for legal settlements | 0 | 154,000 |
Deferred revenue | (155,000) | 0 |
Net cash provided by (used in) operating activities | (2,017,000) | 15,000 |
Cash flows from investing activities: | ||
Acquisition of cryptocurrencies, net | (1,264,000) | 0 |
Proceeds from sale of cryptocurrencies | 4,729,000 | 0 |
Capital expenditures | (137,000) | 0 |
Acquisitions, net of cash received | (23,000) | 0 |
Net cash provided by investing activities | 3,305,000 | 0 |
Cash flows from financing activities: | ||
Borrowing from related party | 0 | 0 |
Payment to related party | (500,000) | (15,000) |
Payment of debt | (10,000) | 0 |
Proceeds from issuance of stock, net | 768,000 | 0 |
Net cash provided by (used in) financing activities | 258,000 | (15,000) |
Net Change in Cash | 1,546,000 | 0 |
Cash at Beginning of Year | 0 | 0 |
Cash at End of Year | 1,546,000 | 0 |
Supplemental Disclosure of Cash Flows Information: | ||
Cash paid for interest | 19,000 | 13,000 |
Cash paid for income taxes | 0 | 0 |
Non-cash Investing and Financing Activities: | ||
Loan of cryptocurrency | 500,000 | 0 |
Cryptocurrency received for payment under contract | 240,000 | 0 |
Fair value of assets in acquisitions | 9,433,000 | 0 |
Fair value of liabilities assumed in acquisitions | 791,000 | 0 |
Accounts receivable settlement for Render Payment | 233,000 | 0 |
Conversion of note receivable in exchange for common stock and preferred stock | 1,598,000 | 0 |
Issuance of stock for services | 1,110,000 | 0 |
Issuance of Series A Preferred for services | 2,000,000 | 0 |
Conversion of accounts payable to related party to common stock | 40,000 | 195,000 |
Sale of software to related party | 0 | 1,900,000 |
Conversion of debt through sale of cryptocurrencies | $ 0 | $ 218,000 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Oct. 31, 2021 | |
Organization and Basis of Presentation | |
Note 1. Organization and Basis of Presentation | Note 1. Organization and Basis of Presentation The accompanying unaudited consolidated financial statements of Everything Blockchain, Inc. and its consolidated subsidiaries (collectively, the “Company”, “we”, “our”), have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules of the SEC. All significant intercompany accounts and transactions have been eliminated. Description of Business The Company’s early model was to earn revenue through social media advertising, fees, and services. Under this plan, the Company developed its white label software solution for BOTS under the 420 Cloud brand. After multiple attempts to secure acceptance in the market, the Company discontinued this operation during the fiscal year ended January 31, 2020. In April 2020 the Company divested and sold its white label software solution and changed direction of its business. The Company has become a developer, engineer, and consultant in the industry of blockchain technologies. Subsidiaries of the Company On April 26, 2021, in a settlement agreement with Render Payment, LLC (“Render”) owners, the Company became the sole owner of Render, in exchange for an outstanding accounts receivable the Company impaired in 2019. The settlement was considered a related party transaction and conducted as an arm’s length transaction approved by board members not associated with Render. As part of the transaction the Company recognized other income of $233,000 as fair market value (“FMV”) of the assets obtained under the settlement. The Company received two vehicles with FMV of $49,000 each and the Render Payment Processing Software with a FMV of $135,000. On June 21, 2021, the Company acquired all of the equity interests of 832 Energy Technology Consultants, LLC (“832”), pursuant to a Purchase Agreement. Upon the closing of the transaction (the “832 Acquisition”), 832 became a wholly owned subsidiary of the Company. 832, which is located in Texas, has developed many innovations in the areas of distributed computing, artificial intelligence and blockchain. For information on the 832 Acquisition refer to “Note 4. 832 Acquisition”. On June 30, 2021, the Company acquired all of the equity interests of Mercury, Inc. (“Mercury”), pursuant to a Purchase Agreement dated April 24, 2021. Upon the closing of the transaction (the “Mercury Acquisition”), Mercury became a wholly owned subsidiary of the Company. The Company has utilized Mercury, which is located in Idaho, as its hosting solution since May 2020. The Company with Mercury will launch its mining operations in the western United States. The Company will commence mining for Bitcoins, Ethereum, and other alternative cryptocurrencies. For information on the Mercury Acquisition refer to “Note 5. Mercury Acquisition”. On July 31, 2021, the Company acquired all of the equity interests of Vengar Technologies LLC (“Vengar”), pursuant to a Purchase Agreement. Upon the closing of the transaction (the “Vengar Acquisition”), Vengar became a wholly owned subsidiary of the Company. Vengar, which is located in Florida, has developed a zero trust protection software that the Company plans to integrate into its blockchain solutions. For information on the Vengar Acquisition refer to “Note 6. Vengar Acquisition”. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Oct. 31, 2021 | |
Summary of Significant Accounting Policies | |
Note 2. Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most significant estimates and judgments relate to: revenue recognition; sales returns and other allowances; allowance for doubtful accounts; valuation of inventory; valuation and recoverability of long-lived assets; property and equipment; contingencies; and income taxes. On a regular basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Concentration of Credit Risk and Significant Customers Financial instruments which potentially subject the Company to a concentration of credit risk consist principally of temporary cash investments and accounts receivable. Concentrations of credit risk with respect to trade receivables and commodities are limited due to the Company’s diverse group of customers. The Company establishes an allowance for doubtful accounts when events and circumstances regarding the collectability of its receivables or the selling of its commodities warrant based upon factors such as the credit risk of specific customers, historical trends, other information and past bad debt history. The outstanding balances are stated net of an allowance for doubtful accounts. Revenues from one customer represent $1.0 million and $0 of the Company's revenue for the nine-month periods ended October 31, 2021 and 2000, respectfully. Our cash balances are maintained in accounts held by major banks and financial institutions located in the United States. The Company may occasionally maintain amounts on deposit with a financial institution that are in excess of the federally insured limit of $250,000. The risk is managed by maintaining all deposits in high-quality financial institutions. The Company had $0.6 million in excess of federally insured limits on October 31, 2021. Our cryptocurrency balances are maintained in accounts held by institutions located in and outside the United States. The Company maintains amounts on deposit that often exceed coverage from third party insured limit of up to $1,000,000. The risk is managed by maintaining multiple accounts with various accounts held in a cold storage wallet. The Company had $5.0 million in excess of amounts protected by insurance. Cash and Cash Equivalents The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months of the date of purchase. Basic and Diluted Net Earnings (Loss) Per Share The Company follows ASC Topic 260 – Earnings Per Share FASB 2015-06, Earnings Per Share |
Going Concern
Going Concern | 9 Months Ended |
Oct. 31, 2021 | |
Going Concern | |
Note 3. Going Concern | Note 3. Going Concern The Company's consolidated financial statements are prepared in accordance with GAAP, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. Because the business is new and has a limited history, no certainty of continuation can be stated. The accompanying financial statements for the three and nine months ended October 31, 2021 and 2020 have been prepared to assume that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. |
832 Acquisition
832 Acquisition | 9 Months Ended |
Oct. 31, 2021 | |
832 Acquisition | |
Note 4. 832 Acquisition | Note 4. 832 Acquisition On June 21, 2021, the Company acquired all the equity interests of 832. This acquisition is consistent with the Company’s strategy of expanding its blockchain business. The purchase price consisted of 300,000 shares of common stock valued at $1.5 million. This business combination has been accounted for using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their fair market values as of the acquisition date. The purchase price recognized in our financial statements consisted of the following (amounts in thousands): Common stock $ 1,542 Total purchase price $ 1,542 The Company’s preliminary purchase price allocation is as follows (amounts in thousands): Cash $ 20 Intangible assets 1,542 Accounts payable and accrued expenses (20 ) Total preliminary purchase price $ 1,542 Intangible assets consist of blockchain source code for QueryChain. The final purchase price and the allocation thereof will not be known until the valuation of intangible assets is completed. The operations of 832 are included in the consolidated statement of operations as of June 21, 2021. During the three months ended October 31, 2021, the Company recorded revenue of $0.1 million and no net income related to 832. During the nine months ended October 31, 2021, the Company recorded revenue of $0.2 million and no net income related to 832. |
Mercury Acquisition
Mercury Acquisition | 9 Months Ended |
Oct. 31, 2021 | |
Mercury Acquisition | |
Note 5. Mercury Acquisition | Note 5. Mercury Acquisition On June 30, 2021, the Company acquired all the equity interests of Mercury. This acquisition is consistent with the Company’s strategy of expanding its cryptocurrency business. The purchase price consisted of 450,000 shares of common stock valued at $1.3 million and $0.1 million of cash. This business combination has been accounted for using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their fair market values as of the acquisition date. The purchase price recognized in our financial statements consisted of the following (amounts in thousands): Cash $ 65 Common stock 1,350 Total purchase price $ 1,415 The Company’s purchase price allocation is as follows (amounts in thousands): Cash $ 74 Accounts receivable 33 Property, plant & equipment 740 Goodwill 1,319 Accounts payable and accrued expenses (426 ) Deferred revenue (3 ) Notes payable (322 ) Total purchase price $ 1,415 The goodwill recorded reflects the value to the Company of Mercury’s mining operations. The operations of Mercury are included in the consolidated statement of operations as of July 1, 2021. During the three months ended October 31, 2021, the Company recorded revenue of $0.4 million and net loss of $0.1 million related to Mercury. During the nine months ended October 31, 2021, the Company recorded revenue of $0.5 million and net loss of $0.1 million related to Mercury. |
Vengar Acquisition
Vengar Acquisition | 9 Months Ended |
Oct. 31, 2021 | |
Vengar Acquisition | |
Note 6. Vengar Acquisition | Note 6. Vengar Acquisition On July 31, 2021, the Company acquired all the equity interests of Vengar. This acquisition is consistent with the Company’s strategy of expanding its blockchain business. The purchase price consisted of 1,000,000 shares of common stock valued at $5.7 million and $0.1 million of cash. This business combination has been accounted for using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their fair market values as of the acquisition date. The purchase price recognized in our financial statements consisted of the following (amounts in thousands): Cash $ 50 Common stock 5,750 Total purchase price $ 5,800 The Company’s preliminary purchase price allocation is as follows (amounts in thousands): Cash $ 27 Intangible assets 5,812 Accounts payable and accrued expenses (39 ) Total preliminary purchase price $ 5,800 Intangible assets consist of patents. The final purchase price and the allocation thereof will not be known until the valuation of intangible assets is completed. The operations of Vengar are included in the consolidated statement of operations as of August 1, 2021. During the three and nine months ended October 31, 2021, the Company recorded no revenue and net loss of $0.1 million related to Vengar. |
Revenue
Revenue | 9 Months Ended |
Oct. 31, 2021 | |
Revenue | |
Note 7. Revenue | Note 7. Revenue Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. We determine revenue recognition through the following steps: · Identification of the contract, or contracts, with a customer, · Identification of the performance obligations in the contract, · Determination of the transaction price, · Allocation of the transaction price to the performance obligations in the contract; and, · Recognition of revenue when, or as, we satisfy a performance obligation. Revenue was $62,000 for the three and nine months ended October 31, 2020, consisting of consulting and service revenue. The following table presents revenue for the three and nine months ended October 31, 2021 disaggregated by revenue source (in thousands): Revenue Net revenue For the Three Months Ended October 31, 2021 For the Nine Months Ended October 31, 2021 Transactional revenue Consulting and services revenue $ 706 $ 1,961 Total transaction revenue 706 1,961 Subscription and services revenue Staking revenue 124 255 Total subscription and services revenue 124 255 Total net revenue 830 2,216 Other revenue Fair value adjustment to cryptocurrency 2,328 4,685 Crypto asset sales revenue 1,748 4,655 Interest income - 47 Total other revenue 4,076 9,387 Total revenue $ 4,906 $ 11,603 Transaction revenue The Company charges a fee for its services at the transactional level. Currently the Company is engaged in developing, engineering, and designing blockchain projects, to include platforms and cryptocurrencies for customers. We typically treat all revenue generated from third parties for services as transaction revenue. Subscription and service revenue Subscription and service revenue primarily consist of staking revenue. The Company participates in networks with proof-of-stake consensus algorithms, through creating or validating blocks on the network. In exchange for participating in the consensus mechanism of these networks, the Company earns rewards in the form of the native token of the network. Each block creation or validation is a performance obligation. Revenue is recognized at the point when the block creation or validation is complete, and the rewards are available for transfer. Revenue is measured based on the number of tokens received and the fair value of the token at the date of recognition. Other revenues The Company includes interest income as a part of revenue when generated from non-cash equivalents as other revenue within net revenue. Interest earned on cash and cash equivalents is included in corporate interest income, within other income. Other revenue also includes the sale of crypto assets. The Company records the total value of the sale in other revenue and the cost of the crypto assets in cost of sales within the consolidated statements of operations. |
Notes
Notes | 9 Months Ended |
Oct. 31, 2021 | |
Notes | |
Note 8. Notes | Note 8. Notes On March 17, 2021, the Company entered into a loan agreement for $500,000 with Epic Industry Corp (“Epic”), a wholly owned company of Michael Hawkins, the Company’s Chairman of the board of directors. The loan was financed with $500,000 of GUSD cryptocurrency tokens, a stable coin. The interest rate was 3% per annum. The Company paid off the loan during the quarter ended July 31, 2021. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Oct. 31, 2021 | |
Related Party Transactions | |
Note 9. Related Party Transactions | Note 9. Related Party Transactions During the nine months ended October 31, 2021 and year ended January 31, 2021, Overwatch Partners paid multiple different expenses on behalf of the Company, which the Company treats as an account payable to related party. The total amount owed by the Company to Overwatch Partners as of October 31, 2021 was $23,646. The amount owed for the year ended January 31, 2021 was $12,862. On August 9, 2021, Eric Jaffe exercised his warrants of 50,000 shares at the exercise price of $2.12 per share on a cashless basis, resulting in the issuance of 42,246 shares of common stock. (See Note 10 – Stockholder’s Equity) On July 6, 2021, the Company entered into a settlement agreement with BOTS, Inc. Under the settlement agreement, BOTS agreed to return 250,000 shares of Series B Preferred stock to the treasury of the Company, in exchange for the assignment of the $1.4 million promissory note owed by First Bitcoin Capital Corp to the Company, along with all interest owed to date on the promissory note. In addition, the Company transferred 20,726,120 BIT tokens to BOTS. This was a related party transaction and was conducted at arm’s length. (See Note 10 – Stockholder’s Equity) During the quarter ended July 31, 2021, the Company issued 50,000 shares of Series A Preferred Stock to Epic. (See Note 10 – Stockholder’s Equity) On April 12, 2021 Epic exercised the warrant it had and purchased 100,000 shares of common stock in exchange for $100,000. (See Note 10 – Stockholders’ Equity) During the quarter ended April 30, 2021, the Company issued seven warrants to its officers and directors for the purchase of up to a total of 1,100,000 common shares of stock at $2.21 per share. (See Note 14 – Warrants) On March 17, 2021 the Company borrowed $500,000 from Epic. (See Note 8 – Notes) On April 29, 2020 the Company converted 5,000,000 shares of common stock owned by BOTS, Inc., into 500,000 shares of Series B Preferred stock. (see Note 10 – Stockholders’ Equity) On April 22, 2020 the Company converted $104,987 outstanding accounts payable to Paul Rosenberg into 130,128 shares of common stock of the Company at $0.75 per share. (See Note 10 – Stockholders’ Equity) On April 17, 2020, the Company issued 50,000 shares of Series A Preferred Stock to Epic and 100,000 shares of Series A Preferred Stock to Overwatch Partners, Inc. (See Note 10 – Stockholders’ Equity) On April 17, 2020, the Company issued 150,000 shares of Series B Preferred Stock to Paul Rosenberg. (See Note 10 – Stockholders’ Equity) |
Stockholders Equity
Stockholders Equity | 9 Months Ended |
Oct. 31, 2021 | |
Stockholders Equity | |
Note 10. Stockholders' Equity | Note 10. Stockholders’ Equity Common Stock As of October 31, 2021 and January 31, 2021, the Company had 200 million common shares authorized, with 8,604,038 and 5,974,125 common shares at a par value of $0.0001 issued and outstanding, respectively. On October 21, 2021, the Company sold 25,000 shares of common stock to an individual for $150,000 or $6.00 per share of common stock. On September 13, 2021, the Law Offices of Carl G. Hawkins exercised their warrant acquiring 40,000 shares at the strike price of $1.00 per share through the conversion of the accounts payable owed by the Company for services provided. The shares were issued in the name of Carl G. Hawkins. On August 25, 2021, the Company sold 21,000 shares of common stock to an individual for $126,000 or $6.00 per share of common stock. On August 9, 2021, Eric Jaffe exercised his warrants of 50,000 shares at the exercise price of $2.12 per share on a cashless basis, resulting in the issuance of 42,246 shares of common stock. On July 31, 2021, the Company issued 1,000,000 shares of common stock as part of the Vengar Acquisition. On June 30, 2021, the Company issued 300,000 shares of common stock to Chris Carter as part of his employment contract for a three-year period. The shares shall be fully earned upon completion of his three-year contract. On June 30, 2021, the Company issued 450,000 shares of common stock as part of the Mercury Acquisition. On June 24, 2021, the Company issued 5,000 shares of common stock each to Sophie Grinevald and Bill Regan who provided financial and accounting services to the Company for a three-month period. On June 21, 2021, the Company issued 300,000 shares of common stock as part of the 832 Acquisition. On May 23, 2021, the Company entered into an Investor Relations agreement with RedChip Companies. The term of the agreement is for one year. The Company will pay $12,500 per month plus issue 75,000 shares of common stock. On May 23, 2021, the Company issued 5,000 shares of common stock to Sara Moline who provided services as an executive assistant for the Company for a three-month period. On April 12, 2021, Epic exercised the warrant it had and purchased 100,000 shares of common stock in exchange for $100,000. Epic elected to issue the shares in the name of Timothy R Schucker and Anastasia Hawkins JTWROS, the daughter and son-in-law of Michael Hawkins. On April 22, 2020, the Company converted the following accounts payable into shares of common stock at the rate of $0.75 per share. Based upon the stock price of $6.75 on April 22, 2020, the Company recorded the following stock-based compensation as part of the accounts payable conversion action ($ in thousands): Name AP Balance Shares Issued FMV Stock Based Compensation Paul Rosenberg $ 105 130,128 $ 878 $ 773 Brandy Craig $ 69 88,455 $ 597 $ 528 Law Offices of Carl G Hawkins $ 6 8,504 $ 57 $ 51 Thomas G Amon $ 15 19,230 $ 130 $ 115 Total $ 195 246,317 $ 1,662 $ 1,467 Preferred Stock Series A Preferred As of October 31, 2021 and January 31, 2021, the Company had 1 million Series A Preferred shares, par value $0.0001, authorized, with 200,000 and 150,000 Series A Preferred shares issued and outstanding, respectively. The Series A Preferred stock converts into common stock at the option of the holder of the Series A Preferred. The conversion rate for every 1 share of Series A Preferred stock is 50 shares of common stock. Each share of Series A Preferred stock entitles the holder to 1,000 votes. Holders of Series A Preferred are entitled to share ratably in dividends, if any are declared. There are no redemption rights. In the event of dissolution, the holders of Series A Preferred are entitled to share pro rata all assets remaining after payment in full of all liabilities. During the quarter ended July 31, 2021, the Company issued 50,000 shares of Series A Preferred Stock to Epic. The issuance was done as a prepayment for services to generate sales for the Company. The shares are earned as sales generated by Epic achieve certain sales targets. During the quarter ended April 30, 2020 the Company sold 150,000 shares of Series A Preferred Stock to Epic at par value for a total payment of $15. Epic directed the Company to issue 100,000 shares of Series A Preferred stock to Overwatch Partners, Inc., with the remaining 50,000 shares to Epic. The Company recorded the transaction at FMV of $41,068,419 with the difference assigned as stock-based compensation. The Company valued the stock under ASC 820 utilizing the Option Pricing Method to value conversion rights, and the Market Approach to value the voting control. Series B Preferred As of October 31, 2021 and January 31, 2021, the Company had 1.5 million Series B Preferred shares, par value $0.0001, authorized, with 400,000 and 650,000 Series B Preferred shares issued and outstanding, respectively. The Series B Preferred stock converts into common stock at the option of the holder of the Series B Preferred, after twenty-four months of ownership. The conversion rate for every 1 share of Series B Preferred stock is 10 shares of common stock. Each share of Series B Preferred stock entitles the holder to 100 votes. Holders of Series B Preferred are entitled to share ratably in dividends, if any are declared. There are no redemption rights. In the event of dissolution, the holders of Series B Preferred are entitled to share pro rata all assets remaining after payment in full of all liabilities. On July 6, 2021, the Company entered into a settlement agreement with BOTS, Inc. Under the settlement agreement, BOTS agreed to return 250,000 shares of Series B Preferred stock to the treasury of the Company, in exchange for the assignment of the $1.4 million promissory note owed by First Bitcoin Capital Corp to the Company, along with all interest owed to date on the promissory note. In addition, the Company transferred 20,726,120 BIT tokens to BOTS. This was a related party transaction and was conducted at arm’s length. During the quarter ended April 30, 2020, the Company issued 150,000 shares of Series B Preferred stock to Paul Rosenberg in exchange for 60 cryptocurrency ATM machines. Par value of $15 was recorded as inventory with the FMV of $6,629,300 minus the par value being recorded as stock-based compensation. The Company valued the stock under ASC 820 utilizing the Option Pricing Method to value conversion rights, and the Market Approach to value the voting control. On April 29, 2020, the Company converted 5,000,000 shares of common stock owned by BOTS, Inc., into 500,000 shares of Series B Preferred stock. BOTS is restricted from converting the Series B Preferred stock into common stock for a period of 24 months from the conversion. There was no gain or loss on conversion due to conversion terms. During the quarter ending July 31, 2021, BOTS returned to the treasury of the Company 250,000 shares of Series B Preferred stock in exchange for certain assets held by the Company (see Note 15). In addition, BOTS exchanged 125,000 shares of Series B Preferred stock with Epic Industry Corp and Paul Rosenberg in exchange for 50 million shares of BOTS stock held by Epic Industry Corp and Paul Rosenberg, for a total of 100 million BOTS common shares. |
Basic Income per Share
Basic Income per Share | 9 Months Ended |
Oct. 31, 2021 | |
Basic Income per Share | |
Note 11. Basic Income per Share | Note 11. Basic Income per Share Basic Income Per Share |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Oct. 31, 2021 | |
Commitments and Contingencies | |
Note 12. Commitments and Contingencies | Note 12. Commitments and Contingencies The Company reports and accounts for its commitments and contingencies in accordance with ASC 440 – Commitments ASC 450 – Contingencies |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Oct. 31, 2021 | |
Note 13. Legal Proceedings | Note 13. Legal Proceedings The Company may be subject to legal proceedings and claims arising from contracts or other matters from time to time in the ordinary course of business. Management is not aware of any pending or threatened litigation where the ultimate disposition or resolution could have a material adverse effect on the Company’s financial position, results of operations or liquidity. Cease and Desist Notice On November 2, 2021, the Company received a cease and desist notice (the “Notice”) from First Genesis, Inc. (“First Genesis”). The Notice alleges, among other things, that Cedric Harris, the Company’s Chief Research Officer, and the Company were using First Genesis’ intellectual property. Mr. Harris, through 832, developed First Genesis’ intellectual property and has been providing First Genesis with consulting services. 832’s intellectual property, which Mr. Harris also developed, is completely different than the First Genesis intellectual property. We believe that the allege claims by First Genesis are without merit and the Company will continue to vigorously defend against the allegations in the Notice. |
Warrants
Warrants | 9 Months Ended |
Oct. 31, 2021 | |
Warrants | |
Note 14. Warrants | Note 14. Warrants On October 21, 2021, the Company issued a warrant to a stockholder of the Company for the purchase of up to a total of 6,000 shares of common stock at $9.00 per share. Under the vesting schedule 6,000 shares are vested upon signing. The warrants expire on October 20, 2026 at 5:00 PM Eastern Standard Time. On September 30, 2021, the Company issued a warrant to Myosin, Inc. for the purchase of up to a total of 100,000 shares of common stock at $7.00 per share. Under the vesting schedule 100,000 shares are vested upon signing. The warrants expire on September 30, 2026 at 5:00 PM Eastern Standard Time. On September 22, 2021, the Company issued a warrant to one officer of the Company (Bill Regan) for the purchase of up to a total of400,000 shares of common stock at $6.40 per share. Under the vesting schedule 100,000 shares are vested upon signing and 100,000 per year for three consecutive years. The warrants expire on September 21, 2026 at 5:00 PM Eastern Standard Time. On September 20, 2021, the Company issued a warrant to a consultant of the Company (Sophie Grinevald) for the purchase of up to a total of 200,000 shares of common stock at $6.40 per share. Under the vesting schedule 50,000 shares are vested upon signing and 50,000 per year for three consecutive years. The warrants expire on September 19, 2026 at 5:00 PM Eastern Standard Time. On September 20, 2021, the Company issued a warrant to one director of the Company (Thomas Amon) for the purchase of up to a total of 125,000 shares of common stock at $6.00 per share. Under the vesting schedule 50,000 shares are vested upon signing and 25,000 per year for three consecutive years. The warrants expire on September 19, 2026 at 5:00 PM Eastern Standard Time. On September 15, 2021, the Company issued a warrant to one director of the Company (Richard Schaeffer) for the purchase of up to a total of 200,000 shares of common stock at $6.00 per share. Under the vesting schedule 50,000 shares are vested upon signing and 50,000 per year for three consecutive years. The warrants expire on September 14, 2026 at 5:00 PM Eastern Standard Time. On July 31, 2021, the Company issued warrants to two officers of the Company (Toney Jennings and Brandon Hart) for the purchase of up to a total of 400,000 shares of common stock at $5.05 per share. Each warrant holder was authorized to purchase up to 200,000 shares of common stock. Under the vesting schedule 50,000 shares are vested upon signing and 50,000 per year for three consecutive years. The warrants expire on July 30, 2026 at 5:00 PM Eastern Standard Time. On June 21, 2021, the Company issued a warrant to one officer of the Company (Cedric Harris) for the purchase of up to a total of 200,000 shares of common stock at $5.25 per share. Under the vesting schedule 50,000 shares are vested upon signing and 50,000 per year for three consecutive years. The warrants expire on June 20, 2026 at 5:00 PM Eastern Standard Time. On March 11, 2021, the Company issued warrants to three officers of the Company (Robert Adams, Eric Jaffe, and Michael Hawkins) for the purchase of up to a total consolidated 600,000 shares of common stock at $2.21 per share. Each warrant holder was authorized to purchase up to 200,000 shares of common stock. Under the vesting schedule 50,000 shares are vested upon signing and 50,000 per year for three consecutive years. The warrants expire on March 10, 2026 at 5:00 PM Eastern Standard Time. On February 1, 2021, the Company issued warrants to four directors of the Company (Mark Gilroy, Michael Hawkins, Paul Rosenberg, and Robert Adams) for the purchase of up to a total consolidated 500,000 shares of common stock at $2.21 per share. Each warrant holder was authorized to purchase up to 125,000 shares of common stock. Under the vesting schedule 50,000 shares are vested upon signing and 25,000 per year for three consecutive years. The warrants expire on January 31, 2026 at 5:00 PM Eastern Standard Time. On November 1, 2017, the Company issued 7 warrants to officers, directors, and investors for the purchase of up to 3,000,000 shares of common stock at $1.00 per share. The warrants expire on November 1, 2022 at 5:00 PM Eastern Standard Time. The warrants contain participation rights to any registration statement filed by the Company. In April 2020 the Company cancelled one warrant that authorized the purchase of up to 250,000 shares of common stock. Warrants have been exercised four times for a total of 175,000 shares of common stock for $175,000, which was paid $135,000 in cash and $40,000 as a reduction to accounts payable. A summary of warrant activity for nine months ended October 31, 2021 is as follows: Weighted Average Conversion Shares Price Warrants outstanding at January 31, 2021 2,675,000 $ 1.00 Exercised (190,000 ) 1.32 Granted 2,731,000 4.41 Warrants outstanding at October 31, 2021 5,216,000 $ 2.77 |
Sale of Assets to Related Party
Sale of Assets to Related Party | 9 Months Ended |
Oct. 31, 2021 | |
Sale of Assets to Related Party | |
Note 15: Sale of Assets to Related Party | Note 15: Sale of Assets to Related Party On May 13, 2020, the Company sold its 420 Cloud Software to First Bitcoin Capital, Inc., for the purchase price of $1.9 million. The $1.9 million was paid through the transfer of $0.5 million in BIT cryptocurrency and a $1.4 million convertible promissory note. The Company received 122,968,776.18 BIT tokens at the price of $0.004066098 per token. The convertible promissory note had a simple interest fee of 9% per year and may have been converted into First Bitcoin Capital Corp stock at a 10% discount to market or in additional BIT cryptocurrency tokens. The Note had no expiration date. The convertible note receivable was convertible into stock that was thinly traded on the OTC Markets and since it was related party the credit was to equity. On July 6, 2021, the $1.4 million convertible promissory note was exchanged as part of the settlement agreement with BOTS, Inc. (See Note 9 – Related Party Transactions) |
Cryptocurrency Assets
Cryptocurrency Assets | 9 Months Ended |
Oct. 31, 2021 | |
Cryptocurrency Assets | |
Note 16. Cryptocurrency Assets | Note 16. Cryptocurrency Assets The Company records cryptocurrency assets as an intangible asset with infinite life. We classify cryptocurrency that have a market value and substantial liquidity as current intangible assets, which we value at fair market value in accordance with Statement No. 157. Cryptocurrencies that do not trade on a market or have limited liquidity are classified as non-current intangible assets and are recorded on a cost basis. The following chart shows our cryptocurrency assets as of October 31, 2021 and January 31, 2021: Cryptocurrency Holdings Current Assets (in thousands) As of As of October 31, 2021 January 31, 2021 Coin Symbol FMV FMV BTC $ 434 $ - ETH 2 - GUSD 1 - USDC 144 - HEX 4,889 123 $ 5,470 $ 123 Non-Current Assets (in thousands) As of As of October 31, 2021 January 31, 2021 Coin Symbol Cost Basis Cost Basis PRES $ - $ 15 BIT - 83 $ - $ 98 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Oct. 31, 2021 | |
Subsequent Events | |
Note 17. Subsequent Events | Note 17. Subsequent Events In accordance with ASC 855-10, Company management reviewed all material events through the date of this report and determined that there are no additional material subsequent events to report. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Oct. 31, 2021 | |
Summary of Significant Accounting Policies | |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most significant estimates and judgments relate to: revenue recognition; sales returns and other allowances; allowance for doubtful accounts; valuation of inventory; valuation and recoverability of long-lived assets; property and equipment; contingencies; and income taxes. On a regular basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. |
Concentration of Credit Risk and Significant Customers | Financial instruments which potentially subject the Company to a concentration of credit risk consist principally of temporary cash investments and accounts receivable. Concentrations of credit risk with respect to trade receivables and commodities are limited due to the Company’s diverse group of customers. The Company establishes an allowance for doubtful accounts when events and circumstances regarding the collectability of its receivables or the selling of its commodities warrant based upon factors such as the credit risk of specific customers, historical trends, other information and past bad debt history. The outstanding balances are stated net of an allowance for doubtful accounts. Revenues from one customer represent $1.0 million and $0 of the Company's revenue for the nine-month periods ended October 31, 2021 and 2000, respectfully. Our cash balances are maintained in accounts held by major banks and financial institutions located in the United States. The Company may occasionally maintain amounts on deposit with a financial institution that are in excess of the federally insured limit of $250,000. The risk is managed by maintaining all deposits in high-quality financial institutions. The Company had $0.6 million in excess of federally insured limits on October 31, 2021. Our cryptocurrency balances are maintained in accounts held by institutions located in and outside the United States. The Company maintains amounts on deposit that often exceed coverage from third party insured limit of up to $1,000,000. The risk is managed by maintaining multiple accounts with various accounts held in a cold storage wallet. The Company had $5.0 million in excess of amounts protected by insurance. |
Cash and Cash Equivalents | The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months of the date of purchase. |
Basic and Diluted Net Earnings (Loss) Per Share | The Company follows ASC Topic 260 – Earnings Per Share FASB 2015-06, Earnings Per Share |
832 Acquisition (Tables)
832 Acquisition (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Revenue | |
Schedule of purchase price recognized | Common stock $ 1,542 Total purchase price $ 1,542 |
Schedule of preliminary purchase price allocation | Cash $ 20 Intangible assets 1,542 Accounts payable and accrued expenses (20 ) Total preliminary purchase price $ 1,542 |
Mercury Acquisition (Tables)
Mercury Acquisition (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Mercury Acquisition | |
Schedle of recognized purchase price | Cash $ 65 Common stock 1,350 Total purchase price $ 1,415 |
Schedule of purchase price allocation | Cash $ 74 Accounts receivable 33 Property, plant & equipment 740 Goodwill 1,319 Accounts payable and accrued expenses (426 ) Deferred revenue (3 ) Notes payable (322 ) Total purchase price $ 1,415 |
Vengar Acquisition (Tables)
Vengar Acquisition (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Vengar Acquisition | |
Schedule of purchase price recognized in our financial statements | Cash $ 50 Common stock 5,750 Total purchase price $ 5,800 |
Schedule of Company's preliminary purchase price allocation | Cash $ 27 Intangible assets 5,812 Accounts payable and accrued expenses (39 ) Total preliminary purchase price $ 5,800 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Revenue | |
Schedule of Revenue | Revenue Net revenue For the Three Months Ended October 31, 2021 For the Nine Months Ended October 31, 2021 Transactional revenue Consulting and services revenue $ 706 $ 1,961 Total transaction revenue 706 1,961 Subscription and services revenue Staking revenue 124 255 Total subscription and services revenue 124 255 Total net revenue 830 2,216 Other revenue Fair value adjustment to cryptocurrency 2,328 4,685 Crypto asset sales revenue 1,748 4,655 Interest income - 47 Total other revenue 4,076 9,387 Total revenue $ 4,906 $ 11,603 |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Stockholders Equity | |
Schedule of Stock Based Compensation | Name AP Balance Shares Issued FMV Stock Based Compensation Paul Rosenberg $ 105 130,128 $ 878 $ 773 Brandy Craig $ 69 88,455 $ 597 $ 528 Law Offices of Carl G Hawkins $ 6 8,504 $ 57 $ 51 Thomas G Amon $ 15 19,230 $ 130 $ 115 Total $ 195 246,317 $ 1,662 $ 1,467 |
Warrants (Tables)
Warrants (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Warrants | |
Schedule of warrant activity | Weighted Average Conversion Shares Price Warrants outstanding at January 31, 2021 2,675,000 $ 1.00 Exercised (190,000 ) 1.32 Granted 2,731,000 4.41 Warrants outstanding at October 31, 2021 5,216,000 $ 2.77 |
Cryptocurrency Assets (Tables)
Cryptocurrency Assets (Tables) | 9 Months Ended |
Oct. 31, 2021 | |
Cryptocurrency Assets | |
Schedule of cryptocurrency assets | Cryptocurrency Holdings Current Assets (in thousands) As of As of October 31, 2021 January 31, 2021 Coin Symbol FMV FMV BTC $ 434 $ - ETH 2 - GUSD 1 - USDC 144 - HEX 4,889 123 $ 5,470 $ 123 Non-Current Assets (in thousands) As of As of October 31, 2021 January 31, 2021 Coin Symbol Cost Basis Cost Basis PRES $ - $ 15 BIT - 83 $ - $ 98 |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details Narrative) | Apr. 26, 2021USD ($) |
Render [Member] | Two Vehicles [Member] | |
Receivable | $ 49,000 |
Render [Member] | Software [Member] | |
Receivable | 135,000 |
832 [Member] | Purchase Price Reconized [Member] | |
Receivable | $ 233,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2021 | Oct. 31, 2020 | |
Federally insured limit | $ 250,000 | |
FDIC Limit, excess | 600,000 | |
One Customer [Member] | ||
Revenue | 1,000,000 | $ 0 |
Third Party [Member] | ||
Federally insured limit | 1,000,000 | |
FDIC Limit, excess | $ 5,000,000 |
832 Acquisition (Details)
832 Acquisition (Details) - 832 [Member] - Purchase Price Reconized [Member] $ in Thousands | 1 Months Ended |
Jun. 21, 2021USD ($) | |
Common stock | $ 1,542 |
Total purchase price | $ 1,542 |
832 Acquisition (Details 1)
832 Acquisition (Details 1) - 832 [Member] - Purchase Price Allocation [Member] $ in Thousands | Jun. 21, 2021USD ($) |
Cash | $ 20 |
Intangible assets | 1,542 |
Accounts payable and accrued expenses | (20) |
Total preliminary purchase price | $ 1,542 |
832 Acquisition (Details Narrat
832 Acquisition (Details Narrative) - 832 [Member] - Purchase Price Allocation [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Oct. 31, 2021 | Oct. 31, 2021 | Jun. 21, 2021 | |
Revenue recorded | $ 0.1 | $ 0.2 | |
Common stock acquired | 300,000 | ||
Common stock value | $ 1.5 |
Mercury Acquisition (Details)
Mercury Acquisition (Details) - Mercury Acquisition [Member] - Purchase Price Reconized [Member] $ in Thousands | Jun. 30, 2021USD ($) |
Cash | $ 65 |
Common stock | 1,350 |
Total purchase price | $ 1,415 |
Mercury Acquisition (Details 1)
Mercury Acquisition (Details 1) - USD ($) | Oct. 31, 2021 | Jun. 30, 2021 | Jan. 31, 2021 |
Cash | $ 1,546,000 | $ 0 | |
Goodwill | $ 1,319,000 | $ 0 | |
Mercury Acquisition [Member] | Purchase Price Allocation [Member] | |||
Cash | $ 74 | ||
Accounts receivable | 33,000 | ||
Property, plant & equipment | 740,000 | ||
Goodwill | 1,319,000 | ||
Accounts payable and accrued expenses | (426,000) | ||
Deferred revenue | (3,000) | ||
Notes payable | (322,000) | ||
Total purchase price | $ 1,415,000 |
Mercury Acquisition (Details Na
Mercury Acquisition (Details Narrative) - Mercury [Member] - Purchase Price Allocation [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Oct. 31, 2021 | Oct. 31, 2021 | Jun. 30, 2021 | |
Revenue recorded | $ 0.4 | $ 0.5 | |
Net loss | $ 0.1 | $ 0.1 | |
Common stock acquired | 450,000 | ||
Common stock value | $ 1.3 | ||
Cash acquired | $ 0.1 |
Vengar Acquisition (Details)
Vengar Acquisition (Details) - USD ($) | Oct. 31, 2021 | Jan. 31, 2021 |
Cash | $ 1,546,000 | $ 0 |
Common stock | 1,000 | $ 1,000 |
Vengar Acquisition [Member] | ||
Cash | 50,000 | |
Common stock | 5,750,000 | |
Total purchase price | $ 5,800,000 |
Vengar Acquisition (Details 1)
Vengar Acquisition (Details 1) - USD ($) $ in Thousands | Oct. 31, 2021 | Jan. 31, 2021 |
Accounts payable and accrued expenses | $ (276) | $ (6) |
Vengar Acquisition [Member] | ||
Cash | 27 | |
Intangible assets | 5,812 | |
Accounts payable and accrued expenses | (39) | |
Total preliminary purchase price | $ 5,800 |
Vengar Acquisition (Details Nar
Vengar Acquisition (Details Narrative) - Vengar Acquisition [Member] $ in Millions | 9 Months Ended |
Oct. 31, 2021USD ($)shares | |
Purchase price including common stock, shares | shares | 1,000,000 |
Purchase price including common stock, value | $ 5.7 |
Acquisition purchase price in cash | $ 0.1 |
Revenue (Details)
Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended |
Oct. 31, 2021 | Oct. 31, 2021 | |
Total transaction revenue | $ 706,000 | $ 1,961,000 |
Total Revenue | 4,906,000 | 11,603,000 |
Interest Income [Member] | ||
Other revenue | 0 | 47,000 |
Consulting and services revenue [Member] | ||
Total transaction revenue | 706,000 | 1,961,000 |
Fair value adjustment to cryptocurrency [Member] | ||
Other revenue | 2,328,000 | 4,685,000 |
Total subscription and services revenue [Member] | ||
Other revenue | 124,000 | 255,000 |
Total other revenue [Member] | ||
Other revenue | 4,076,000 | 9,387,000 |
Staking revenue [Member] | ||
Other revenue | 124,000 | 255,000 |
Total net revenue [Member] | ||
Other revenue | 830,000 | 2,216,000 |
Crypto asset sales revenue [Member] | ||
Other revenue | $ 1,748,000 | $ 4,655,000 |
Revenue (Details Narrative)
Revenue (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended |
Oct. 31, 2021 | Oct. 31, 2021 | |
Revenue | ||
Revenue | $ 62,000 | $ 62,000 |
Notes (Details Narrative)
Notes (Details Narrative) | 1 Months Ended |
Mar. 17, 2021USD ($) | |
CFO [Member] | |
Loan financed | $ 500,000 |
Epic Industry Corp [Member] | |
Loan amount | $ 500,000 |
Interest rate | 3.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Aug. 09, 2021 | Jul. 06, 2021 | Apr. 12, 2021 | Apr. 22, 2020 | Apr. 17, 2020 | Apr. 30, 2021 | Oct. 31, 2021 | Mar. 17, 2021 | Jan. 31, 2021 | Apr. 29, 2020 |
First Bitcoin Capital Corp [Member] | ||||||||||
Promissory notes | $ 1,400,000 | |||||||||
Description of BIT tokens | the Company transferred 20,726,120 BIT tokens to BOTS | |||||||||
Overwatch Partners, Inc [Member] | ||||||||||
Due to Related Party | $ 23,646 | $ 12,862 | ||||||||
Issuane of preferred stock | $ 100,000 | |||||||||
Paul Rosenberg [Member] | ||||||||||
Preferred Stock issued | 150,000 | |||||||||
Shares Issued, conversions, amount | $ 104,987 | |||||||||
Shares Issued, conversions, shares | 130,128 | |||||||||
Common stock, par value | $ 0.75 | |||||||||
Series A Preferred Stock [Member] | ||||||||||
Preferred Stock issued | 200,000 | 150,000 | ||||||||
Series B Preferred Stock [Member] | ||||||||||
Preferred Stock issued | 400,000 | 650,000 | ||||||||
Series B Preferred Stock [Member] | Preferred Stock Issuance | ||||||||||
Preferred Stock issued | 150,000 | |||||||||
Series B Preferred Stock [Member] | BOTS Inc [Member] | ||||||||||
Preferred Stock issued | 250,000 | |||||||||
Epic [Member] | ||||||||||
Common stock shares purchase upon issue of warrants | 100,000 | |||||||||
Preferred stock series A, shares issued | 50,000 | |||||||||
Epic [Member] | Series A Preferred Stock [Member] | ||||||||||
Preferred Stock issued | 50,000 | |||||||||
Eric Jaffe [Member] | ||||||||||
Common stock shares purchase upon issue of warrants | 50,000 | |||||||||
Issuance of warrants | 42,246 | |||||||||
Exercise price | $ 2.12 | |||||||||
MCIG, Inc [Member] | Series B Preferred Stock [Member] | ||||||||||
Common stock, shares converted | 5,000,000 | |||||||||
Convertible preferred stock | 500,000 | |||||||||
BOTS, Inc [Member] | Series B Preferred Stock [Member] | ||||||||||
Common stock, shares converted | 5,000,000 | |||||||||
BOTS, Inc [Member] | Series B Preferred Stock [Member] | Paul Rosenberg [Member] | ||||||||||
Common stock, shares converted | 5,000,000 | |||||||||
Epic Industry Corp [Member] | ||||||||||
Common shares purchased | 1,100,000 | |||||||||
Loan amount | $ 500,000 | |||||||||
sale of stock per share | $ 2.21 |
Stockholders Equity (Details)
Stockholders Equity (Details) - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2021 | Apr. 30, 2020 | Oct. 31, 2021 | Oct. 31, 2020 | |
Stock Based Compensation | $ 0 | $ 48,153,000 | $ 0 | $ 49,204,000 |
Paul Rosenberg [Member] | ||||
Stock Based Compensation | 773,000 | |||
Conversion of accounts payable to common stock | $ 105,000 | |||
Conversion of accounts payable, shares | 130,128 | |||
Fair Market Value | $ 878,000 | |||
Brandy Craig [Member] | ||||
Stock Based Compensation | 528,000 | |||
Conversion of accounts payable to common stock | $ 69,000 | |||
Conversion of accounts payable, shares | 88,455 | |||
Fair Market Value | $ 597,000 | |||
Law Offices of Carl G Hawkins [Member] | ||||
Stock Based Compensation | 51,000 | |||
Conversion of accounts payable to common stock | $ 6,000 | |||
Conversion of accounts payable, shares | 8,504 | |||
Fair Market Value | $ 57,000 | |||
Thomas G Amon [Member] | ||||
Stock Based Compensation | 115,000 | |||
Conversion of accounts payable to common stock | $ 15,000 | |||
Conversion of accounts payable, shares | 19,230 | |||
Fair Market Value | $ 130,000 | |||
Total [Member] | ||||
Stock Based Compensation | 1,467,000 | |||
Conversion of accounts payable to common stock | $ 195,000 | |||
Conversion of accounts payable, shares | 246,317 | |||
Fair Market Value | $ 1,662,000 |
Stockholders Equity (Details Na
Stockholders Equity (Details Narrative) - USD ($) | Aug. 09, 2021 | Jul. 06, 2021 | Apr. 12, 2021 | Oct. 21, 2021 | Aug. 25, 2021 | Jun. 30, 2021 | Jun. 24, 2021 | Jun. 21, 2021 | May 23, 2021 | Apr. 29, 2020 | Apr. 30, 2021 | Apr. 30, 2020 | Oct. 31, 2021 | Jan. 31, 2021 | Apr. 22, 2020 |
Common stock, shares authorized | 200,000,000 | 200 | |||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | |||||||||||||
Common stock, shares issued | 8,604,038 | 5,974,125 | |||||||||||||
Common stock, shares outstanding | 8,604,038 | 5,974,125 | |||||||||||||
Share Issuance [Member] | |||||||||||||||
Stock price | $ 6.75 | ||||||||||||||
Common stock, par value | 0.75 | ||||||||||||||
Acquisition [Member] | |||||||||||||||
Common stock sold, shares | 300,000 | ||||||||||||||
Series A Preferred Stock [Member] | |||||||||||||||
Series A Preferred stock, par value | $ 0.0001 | $ 0.0001 | |||||||||||||
Series A Preferred stock, shares issued | 200,000 | 150,000 | |||||||||||||
Preferred stock, description | The conversion rate for every 1 share of Series A Preferred stock is 50 shares of common stock. Each share of Series A Preferred stock entitles the holder to 1,000 votes | ||||||||||||||
Series A Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |||||||||||||
Series A Preferred stock, shares outstanding | 200,000 | 150,000 | |||||||||||||
Series B Preferred Stock [Member] | |||||||||||||||
Series A Preferred stock, par value | $ 0.0001 | $ 0.0001 | |||||||||||||
Series A Preferred stock, shares issued | 400,000 | 650,000 | |||||||||||||
Preferred stock, description | The conversion rate for every 1 share of Series B Preferred stock is 10 shares of common stock. Each share of Series B Preferred stock entitles the holder to 100 votes | ||||||||||||||
Series B Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |||||||||||||
Series B Preferred stock, shares outstanding | 400,000 | 650,000 | |||||||||||||
Series B Preferred Stock [Member] | Preferred Stock Issuance | |||||||||||||||
Series A Preferred stock, par value | $ 15 | $ 15 | |||||||||||||
Series A Preferred stock, shares issued | 150,000 | 150,000 | |||||||||||||
Series B Preferred stock, sale, FMV | $ 6,629,300 | ||||||||||||||
CFO [Member] | |||||||||||||||
Common stock shares purchase upon issue of warrants | 100,000 | ||||||||||||||
Exchange shares, amount | $ 100,000 | ||||||||||||||
Paul Rosenberg [Member] | |||||||||||||||
Common stock, par value | $ 0.75 | ||||||||||||||
Chris Carter [Member] | |||||||||||||||
Common stock sold, shares | 300,000 | ||||||||||||||
Sophie Grinevald and Bill Regan [Member] | |||||||||||||||
Common stock sold, shares | 5,000 | ||||||||||||||
Investor Relations agreement with RedChip [Member] | |||||||||||||||
Common stock sold, shares | 75,000 | ||||||||||||||
Common stock shares value | $ 12,500 | ||||||||||||||
Sara Moline [Member] | |||||||||||||||
Common stock sold, shares | 5,000 | ||||||||||||||
Mercury Acquisition [Member] | |||||||||||||||
Common stock sold, shares | 450,000 | ||||||||||||||
Common stock acquired | 450,000 | ||||||||||||||
Vengar Acquisition [Member] | |||||||||||||||
Common stock sold, shares | 1,000,000 | ||||||||||||||
Eric Jaffe [Member] | |||||||||||||||
Issuance of warrants | 42,246 | ||||||||||||||
Exercise price | $ 2.12 | ||||||||||||||
Common stock shares purchase upon issue of warrants | 50,000 | ||||||||||||||
Individual [Member] | |||||||||||||||
Common stock sold, shares | 25,000 | 21,000 | |||||||||||||
Common stock sold, value | $ 150,000 | $ 126,000 | |||||||||||||
Carl G. Hawkins [Member] | |||||||||||||||
Issuance of warrants | 40,000 | ||||||||||||||
Strike price | $ 1 | ||||||||||||||
Epic Industry Corp [Member] | |||||||||||||||
Common stock sold, shares | 1,100,000 | ||||||||||||||
Epic Industry Corp [Member] | Series A Preferred Stock [Member] | |||||||||||||||
Series A Preferred stock, par value | $ 15 | $ 15 | |||||||||||||
Preferred stock sold | 150,000 | 50,000 | |||||||||||||
Series A Preferred stock, sale, FMV | $ 41,068,419 | ||||||||||||||
Series A Preferred stock, shares issued | 100,000 | 100,000 | |||||||||||||
Remaining shares | 50,000 | ||||||||||||||
BOTS, Inc [Member] | Series B Preferred Stock [Member] | |||||||||||||||
Common stock, shares converted | 5,000,000 | ||||||||||||||
BOTS, Inc [Member] | Paul Rosenberg [Member] | Series B Preferred Stock [Member] | |||||||||||||||
Common stock, shares converted | 5,000,000 | ||||||||||||||
Shares return | 250,000 | 250,000 | |||||||||||||
Promissory note owed by First Bitcoin Capital | $ 1,400,000 | ||||||||||||||
Restricted converting common stock | 500,000 | ||||||||||||||
Conversion period | 24 years | ||||||||||||||
Series B Preferred stock exchange shares | 125,000 | ||||||||||||||
Common stock shares exchange | 50,000,000 | ||||||||||||||
Total common stock shares | 100,000,000 |
Basic Income per Share (Details
Basic Income per Share (Details Narrative) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basic Income per Share | ||||
Basic and diluted income (loss) per common share | $ 0.38 | $ (0.02) | $ 0.92 | $ (6.90) |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2021 | Oct. 31, 2020 | |
Commitments and Contingencies | ||
Loss on contingencies | $ 0 | $ 0 |
Warrants (Details)
Warrants (Details) | 9 Months Ended |
Oct. 31, 2020$ / sharesshares | |
Warrants | |
Warrants outstanding shares, Beginning | shares | 2,675,000 |
Exercised, shares | shares | (190,000) |
Granted, shares | shares | 2,731,000 |
Warrants outstanding shares, Ending | shares | 5,216,000 |
Warrants outstanding weighted average conversion price, Beginning | $ / shares | $ 1 |
weighted average conversion price, Exercised | $ / shares | 1.32 |
Weighted average conversion price, Granted | $ / shares | 4.41 |
Warrants outstanding weighted average conversion price, Ending | $ / shares | $ 2.77 |
Warrants (Details Narrative)
Warrants (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2021 | Jan. 31, 2021 | |
Cash | $ 1,546,000 | $ 0 |
Myosin Inc. [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 7 | |
Date of Issuance | Sep. 30, 2021 | |
Date of expire | Sep. 30, 2026 | |
Common shares issued | 100,000 | |
Vested shares | 100,000 | |
Stockholder of the Company [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 9 | |
Date of Issuance | Oct. 21, 2021 | |
Date of expire | Oct. 20, 2026 | |
Common shares issued | 6,000 | |
Vested shares | 6,000 | |
Toney Jennings and Brandon Hart [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 5.05 | |
Date of Issuance | Jul. 31, 2021 | |
Date of expire | Jul. 30, 2026 | |
Common shares issued | 400,000 | |
Vested shares | 50,000 | |
Common shares purchased | 200,000 | |
Vesting shares | 50,000 | |
Mark Gilroy, Michael Hawkins, Paul Rosenberg, and Robert Adams [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 2.21 | |
Date of Issuance | Feb. 1, 2021 | |
Date of expire | Jan. 31, 2026 | |
Common shares issued | 500,000 | |
Vested shares | 50,000 | |
Common shares purchased | 125,000 | |
Vesting shares | 25,000 | |
Sophie Grinevald [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 6.40 | |
Date of Issuance | Sep. 20, 2021 | |
Date of expire | Sep. 19, 2026 | |
Common shares issued | 200,000 | |
Vested shares | 50,000 | |
Vesting shares | 50,000 | |
Officer Bill Regan [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 6.40 | |
Date of Issuance | Oct. 22, 2021 | |
Date of expire | Oct. 20, 2026 | |
Common shares issued | 400,000 | |
Vested shares | 100,000 | |
Vesting shares | 100,000 | |
Thomas Amon [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 6 | |
Date of Issuance | Sep. 20, 2021 | |
Date of expire | Sep. 19, 2026 | |
Common shares issued | 125,000 | |
Vested shares | 50,000 | |
Vesting shares | 25,000 | |
Richard Schaeffer [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 6 | |
Date of Issuance | Sep. 15, 2021 | |
Date of expire | Sep. 14, 2026 | |
Common shares issued | 200,000 | |
Vested shares | 50,000 | |
Vesting shares | 50,000 | |
Officers, Directors, and Investors [Member] | 7 Warrants [Member] | ||
Sale of stock per share | $ 1 | |
Date of Issuance | Nov. 1, 2017 | |
Date of expire | Nov. 1, 2022 | |
Common shares issued | 3,000,000 | |
Warrants exercised | 175,000 | |
Warrants exercised, value | $ 175,000 | |
Accounts payable | 40,000 | |
Cash | $ 135,000 | |
Cancellation of warrants | 250,000 | |
Robert Adams, Eric Jaffe, and Michael Hawkins [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 2.21 | |
Date of Issuance | Mar. 11, 2021 | |
Date of expire | Mar. 10, 2026 | |
Common shares issued | 600,000 | |
Vested shares | 50,000 | |
Common shares purchased | 200,000 | |
Vesting shares | 50,000 | |
Cedric Harris [Member] | Warrants 1 [Member] | ||
Sale of stock per share | $ 5.25 | |
Date of Issuance | Jun. 21, 2021 | |
Date of expire | Jun. 20, 2026 | |
Common shares issued | 200,000 | |
Vested shares | 50,000 | |
Vesting shares | 50,000 |
Sale of Assets to Related Par_2
Sale of Assets to Related Party (Details Narrative) - First Bitcoin Capital Inc [Member] - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | ||
Oct. 31, 2021 | Jul. 06, 2021 | May 13, 2020 | |
Date of Agreement | May 13, 2020 | ||
Purchase Price | $ 1.9 | ||
Interest rate | 9.00% | ||
Discount rate | 10.00% | ||
Amount paid, through transfer | $ 0.5 | ||
Covertible promissory note | $ 1.4 | ||
Price per token | $ 0.004066098 | ||
Settlement Agreement [Member] | |||
Covertible promissory note exchanged | $ 1.4 |
Cryptocurrency Assets (Details)
Cryptocurrency Assets (Details) - USD ($) $ in Thousands | Oct. 31, 2021 | Jan. 31, 2021 |
Non-Current Assets Cost | $ 0 | $ 98 |
Current Assets FMV | 5,470 | 123 |
BTC [Member] | ||
Current Assets FMV | 434 | 0 |
ETH [Member] | ||
Current Assets FMV | 2 | 0 |
GUSD [Member] | ||
Current Assets FMV | 1 | 0 |
USDC [Member] | ||
Current Assets FMV | 144 | 0 |
HEX [Member] | ||
Current Assets FMV | 4,889 | 123 |
BIT [Member] | ||
Non-Current Assets Cost | 0 | 83 |
PRES [Member] | ||
Non-Current Assets Cost | $ 0 | $ 15 |