Slide 1: Investor Presentation April 2021
Investor Presentation April 2021
Slide 2: Forward Looking Statements
Forward Looking Statements • This presentation contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, future operating and financial performance, product development, market position, business strategy and objectives. T
Slide 3: Disclaimer
Disclaimer The Company makes no representation or warranty, expressed or implied, as to the accuracy or completeness of the information contained in this Presentation, and nothing contained herein is, or shall be relied upon as, a promise or representation, whether as to the past or to the future. T
Slide 4: Investment Highlights
Investment Highlights Public Company with Sole Focus on Ethereum / Altcoins Attractive Returns on Capital. Ability to scale Revenue and EBITDA Rapidly Strategic Partnerships with Industry Leaders: SparkPool and GMR 19.8% granted equity ownership aligns interests Access to scarce mining equipment Dee
Slide 5: Leadership Team
Leadership Team Management Team Board of Directors • 272 Capital L.P, 2020 - Present, Founder and Chief • Early Bitcoin and Ethereum miner Executive Officer Jason Zhang • Former: Sequoia Capital, MSD Capital Wes Cummins • Nokomis Capital, 2012 - 2020, Research Analyst • Harvard University Chairman &
Slide 6: Industry Leading Partners
Industry Leading Partners SparkPool and GMR taking a strategic stake in APLD 9.9% Strategic 9.9% Strategic Ownership Stake Ownership Stake Overview Overview • Largest Ethereum mining pool in the world • Best-in-class partner with four years of mining experience in • Controls ~26% of Ethereum hashrat
Slide 7: What is Ethereum?
What is Ethereum? ETHEREUM ETHER DAPPS MINING • Ethereum is an open • The cryptocurrency of the • Decentralized application • Mining is the process of software platform based Ethereum network (DApp) is a computer creating a block of on blockchain technology • Ether (ETH) is a way to pay application
Slide 8: Why Ethereum?
Why Ethereum? Enables a new version of the internet Material and rapidly growing transaction fee revenue • Global distributed computing network • Growing demand for permissionless platforms • Ethereum is on pace to capture $3.9B in revenue without centralized toll takers in 2021 Largest and most act
Slide 9: Economics of Ethereum Mining
Economics of Ethereum Mining Revenue Costs APLD Hashrate Global Mining Income Electricity Equipment Ether (ETH) Price (Includes block reward and transaction fees based on Fixed Costs Variable Costs utilization of network) (cost per kWh) Efficiency Network Hashrate APLD controls APLD does not control
Slide 10: Diverse Altcoin Opportunity
Diverse Altcoin Opportunity Altcoins that can be mined with GPU Name Market Cap1 ($B) Supply (M) Price1 1-Year Return1 Ethereum $196.4 115.2 $1,702.93 +1,125% Litecoin $12.5 66.7 $187.01 +378% Filecoin $7.5 61.5 $122.13 +4,975% Dogecoin $7.1 128,900.0 $0.05 +2,856% Monero $4.1 17.9 $227.87 +384 Rave
Slide 11: Multi-Pronged Strategy
Multi-Pronged Strategy “Ethereum or Better” Majority of resources deployed (75%+) toward Ethereum (ETH) with opportunistic Mining mining of other altcoins Proprietary Calculate mining returns in real-time and Quantitative Model adjust mining hash power Strategic Crypto Trading strategies to maximize
Slide 12: Mining Equipment and Facility
Mining Equipment and Facility Leveraging high-performing equipment and existing facilities SparkPool and GMR Mining Facility and Dashboard Energy Efficient Low cost hydro electricity Operationally Efficient Most efficient mining software, ensures 99%+ uptime and highest mining rewards Supply C
Slide 13: Forecasted Profit & Loss
Forecasted Profit & Loss ($ in 000s) 2021 2022 2023 Revenue $ 11,965 $ 141,254 $ 199,417 Cost of Mining 4,041 56,126 89,802 Gross Profit 7,924 85,127 109,615 SG&A 2,900 6,000 6,000 EBIT 5,024 79,127 103,615 Depreciation 3,000 41,667 66,667 EBITDA $ 8,024 $ 120,794 $ 170,281 Note: Assumes base case $
Slide 14: Rapidly Scaling EBITDA
Rapidly Scaling EBITDA ($ in 000s, except Ether Price) Transaction Fee/ 1 Ether Price EBITDA Day (USD) (ETH) 2021 2022 2023 Base Case $1,500 9,200 $8,024 $120,794 $170,281 1,750 12,000 11,666 163,631 230,563 2,000 15,000 15,927 213,760 301,106 Q4 2021 Run-Rate EBITDA2 is $24 million at base case Not
Slide 15: Compelling Projected Growth
Compelling Projected Growth Partnerships give APLD the Ample opportunity to ability to scale expand into DeFi, NFT, Dapps, infrastructure, etc. Up-listing gives access to capital Aggressive mining expansion plan providing fuel for rapid growth Ethereum is just reaching mainstream status “New Blockch
Slide 16: Institutional Backing
Institutional Backing • Closed PIPE financing transaction in April 2021 • Led by institutional investors • Gross proceeds of $16.5M, before expenses
Slide 17: Appendix
Appendix
Slide 18: Ethereum Adoption Has Arrived
Ethereum Adoption Has Arrived Total Value Locked (TVL) in DeFi Cryptocurrency Has Reached Mainstream Status • There are currently 2,589 decentralized apps (“dapps”) on Ethereum’s platform • “Christie’s Auction House Will Now Accept Cryptocurrency” – Bloomberg, February 18, 2021 • “The $69 Million Be
Slide 19: Ethereum vs. Bitcoin
Ethereum vs. Bitcoin ETHEREUM (ETH) BITCOIN (BTC) • General purpose mining hardware (GPU) • Specialized mining hardware (ASIC) • Global computation platform • Store-of-value, not used for transactions • Global settlement layer and store-of-value • Not programmable • Programmable and used to build •
Slide 20: Ethereum Surpasses Bitcoin
Ethereum Surpasses Bitcoin Ethereum vs. Bitcoin Daily Transaction Volume Data as of: Jan. 17, 2021 Source: Messari, CoinMetrics Note: Ethereum includes stablecoins, but not other ERC-20s to prevent double counting from DEX volumes. Bitcoin includes USDT issued on Omni 20
Slide 21: Recent Surge In Mining Revenue
Recent Surge In Mining Revenue Ethereum Miner Revenue (Monthly) Data as of: Mar. 1, 2021 Source: Coin Metrics 21
Slide 22: How Does Ethereum Work?
How Does Ethereum Work? Pays “ether” Pays “ether” Miners verify the transaction Dapp Developer creates a Miners group the Ethereum blockchain Client uses application decentralized application transactions (Dapp) on Ethereum together to form a blockchain block New block is added to the blockchain. Mi
Slide 23: GPU Mining
GPU Mining A GPU’s power potential makes it more useful in blockchain mining than traditional CPU mining GPU (graphics processing unit) is responsible for digital rendering in a computer system GPUs are faster and more efficient than CPUs GPU mining solves complex math problems to verify electronic
Slide 24: Why DeFi?
Why DeFi? The problems with Centralized Finance (CeFi) • Lack of transparency • Legacy infrastructure • No global access • Censorship • High fees & costs • Counterparty risk The case for Decentralized Finance (DeFi) • Full transparency • Blockchain technology • Open for everyone • Users have full co