The Virtual Bitcoin ATM Corporate Presentation February 2018 - - PowerPoint PPT Presentation

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The Virtual Bitcoin ATM Corporate Presentation February 2018 - - PowerPoint PPT Presentation

The Virtual Bitcoin ATM Corporate Presentation February 2018 Disclaimer DISCLAIMER This presentation has been prepared by Netcoins Inc. (Netcoins or the Company). It does not purport to contain all the information that a prospective


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The Virtual Bitcoin ATM Corporate Presentation February 2018

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Disclaimer

DISCLAIMER This presentation has been prepared by Netcoins Inc. (“Netcoins” or the “Company”). It does not purport to contain all the information that a prospective investor may require in connection with any potential investment in the Company. You should not treat the contents of this presentation, or any information provided in connection with it, as financial advice, financial product advice or advice relating to legal, taxation or investment matters. This presentation does not include all available information in relation to the business, operations, affairs, financial position or prospects of the Company. No representation or warranty (whether express or implied) is made by the Company or any of its shareholders, directors, officers, advisers, agents or employees as to the accuracy, completeness or reasonableness of the information, statements, opinions or matters (express or implied) arising out of, contained in or derived from this presentation or provided in connection with it, or any omission from this presentation, nor as to the attainability of any estimates, forecasts or projections set out in this presentation. This presentation is provided expressly on the basis that you will carry out your own independent inquiries into the matters contained in the presentation and make your own independent decisions about the business, operations, affairs, financial position or prospects of the Company. The Company reserves the right to update, amend or supplement the information contained in this presentation at any time in its absolute discretion (without incurring any obligation to do so) without any obligation to advise you of any such update, amendment or supplement. The delivery of this presentation shall not, under any circumstance, create any implication that there has been no change in the business, operations, affairs, financial position or prospects of the Company or that information contained herein is correct after the date of this presentation. Neither the Company nor any of its shareholders, directors, officers, advisors, agents or employees take any responsibility for, or will accept any liability whether direct or indirect, express or implied, contractual, tortuous, statutory or otherwise, in respect of the accuracy or completeness of the information contained in this presentation, for any errors, omissions or misstatements in or from this presentation or for any loss howsoever arising from the use of this presentation. Any such responsibility or liability is, to the maximum extent permitted by law, expressly disclaimed and excluded. This presentation does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to subscribe for or purchase, any securities of the Company, nor shall it form the basis of or be relied upon in connection with, or act as any inducement to enter into, any contract or commitment whatsoever with respect to such securities. Under no circumstances should this presentation be construed as a prospectus, advertisement or public offering of securities. FUTURE MATTERS This presentation contains reference to certain intentions, expectations, future plans, strategy and prospects of the Company. Those intentions, expectations, future plans, strategies and prospects may or may not be achieved. They are based on certain assumptions, which may not be met or on which views may differ and may be affected by known and unknown risks. The performance and operations of the Company may be influenced by a number of factors, many of which are outside the control of the Company. No representation or warranty, express or implied, is made by the Company, or any of its shareholders, directors,

  • fficers, advisers, agents or employees that any intentions, expectations or plans will be achieved either totally or partially or that any particular rate of return will be achieved.

Given the risks and uncertainties that may cause the Company’s actual future results, performance or achievements to be materially different from those expected, planned or intended, you should not place undue reliance on these intentions, expectations, future plans, strategies and prospects. The Company does not represent or warrant that the actual results, performance or achievements will be as intended, expected or planned. CONFIDENTIALITY Your receipt of this presentation constitutes your agreement, on behalf of yourself and your representatives, to maintain the confidentiality of the information contained in this presentation. Other than upon prior approval by the Company, any reproduction or distribution of this presentation in whole or in part, any disclosure of its contents or any use of any information contained in this presentation for any purpose is strictly prohibited.

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Our Vision

To be the global leader and most recognized brand servicing the purchase and sale of cryptocurrency in the physical world.

Trusted Transparent Global

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Investment Highlights

Right Place, Right Time, Right Now

Netcoins operates an industry leading virtual bitcoin ATM Network

  • Consumers can easily purchase bitcoin from a retailer
  • All that's needed is a point of sale terminal and access to the internet
  • Takes a minute to complete purchase and have newly created digital wallet

containing bitcoin emailed to customer

Significant Growth: Current Run Rate: Over $2MM Per Month

  • Experiencing rapid month over month growth
  • 50+ virtual ATM locations active / 4000 Virtual ATM locations via Flexepin
  • EBITDA Positive
  • Double Digit CAGR on all metrics

All growth to date achieved via a one man team - Founder and President

  • No sales or marketing team
  • Capital injection via RTO to grow business

Highly Scalable via multiple sales verticals

  • Retailers
  • Private Client Division (for larger bitcoin purchases)
  • Financial Planners

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The Rise of Cryptocurrency

Bitcoin is the largest, most liquid crypto currency in the world

Irreversible

after a confirmation a transaction cannot be reversed

Fast & Global

Transactions occur nearly instantly and can occur anywhere in the world

Secure

Strong cryptography and big numbers make it impossible to break

Permissionless

Anyone can use cryptocurrency, there is no gatekeeper

$0 $20 $40 $60 $80 $100 $120 $140 $160 $180 $200

Feb-16 May-16 Aug-16 Nov-16 Feb-17 May-17 Aug-17

(US$ Billions)

Altcoin Market Cap Bitcoin Market Cap

Source: CoinDance 5

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The Problem: Difficult to Trade and High Fees

Current solutions to buy & sell bitcoin are not always trustworthy, very slow and expensive Physical Bitcoin ATM machines are becoming popular, however they are not scalable due to high machine costs, inventory costs & price fluctuations

  • Online exchanges are slow (1-3 weeks for verification & funding via international wire)
  • Consumers do not trust wiring funds to online exchanges in foreign countries
  • Credit Card purchasing imposes very small purchase limits (like $100/week)
  • ATMs and Peer to Peer are only available at a few locations
  • Physical Bitcoin ATMs rely on Bitcoin “inventory” and charge high fees to avoid losses on Bitcoin price drops
  • Machines can cost up to $20,000 = not scalable
  • Machines only accept cash, have order limits and are not mobile

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Our Solution: Simplicity

Netcoins’ Powerful Software Engine Manages Everything: Bitcoin wallet creation, real-time quoting, exchange, ordering, automated invoicing

  • Familiar retail experience
  • Much faster than online
  • Low fees (no machine cost)
  • Scales extremely well = more locations to buy
  • Customers trust in-person retail & instant ordering

To purchase bitcoin with Netcoins

15 seconds

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The Netcoins Virtual ATM

Customer doesn’t need an existing account or wallet Thousands of convenient locations Accepts cash, debit and additional payment methods Trusted, familiar party to give your money to

The best way to buy & sell cryptocurrencies

Ph Physical AT ATM On Online Ex Exchange Pe Peer to Pe Peer

Co Comp 4

Lower Fees Turns any device into a Bitcoin ATM Purchase Bitcoin within a few minutes 8

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Michael Vogel

Chief Technology Officer & Director

  • Mr. Kevin Ma is a senior

financial professional specializing in corporate finance, public company reporting and regulatory compliance in Canada and United States, strategic planning, financial management, and capital markets for the past 10 years.

  • Mr. Ma is currently the Principal
  • f Skanderbeg Financial Advisory Inc.,

a professional corporation, which provides corporate finance and strategic advisory services to public and private enterprises.

  • Mr. Ma is currently acting as Director

for Carl Data Solutions Inc. (CSE: CRL) and Molori Engery Inc (TSXV: MOL), CFO for First Cobalt Corp. (TSXV: FCC) and Kenadyr Mining (Holdings) Corp. (TSXV: KEN) and senior officer and director for several privately held companies.

Kevin Ma

Chief Financial Officer & Director

Meet The Team

Michael is a prolific engineer with a history of successful product launches from concept, design and launch to

  • market. He involves himself at all

levels including business and technical design aspects. Michael is also a regular speaker on Bitcoin and Blockchain, and is frequently cited in the media as a subject expert, with recent interviews in CoinTelegraph, News1130 (radio) and on the Corus radio network.

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Mark Binns

Chief Executive Officer & Director

Mark Binns has over 20 years of experience building customer-driven sales and marketing strategies. Mark has founded, built, and sold two consulting companies that provided strategic advice on customer acquisition and revenue growth to Fortune 1000 technology companies including RIM, Cisco and Rogers. Mark has also scaled two SAAS based software businesses in the B2C and B2B spaces into leaders in their respective markets. Mark is a Dean’s Honors graduate of the Ivey MBA program and Graduate

  • f the Computer Science Honors

program at Acadia University. Mark has led his companies to PROFIT HOT 50 and PROFIT HOT 100 awards, and was nominated by the Dean of the Richard Ivey School of Business for the prestigious business award of Canada’s “Top 40 Under 40”. Gary has co-founded and successfully exited many technology start-ups. As a creative and entrepreneurial CEO, he has built teams that have grown direct and indirect license revenue channels on a global basis. He is an accomplished business executive that has cultivated key stakeholder relationships, worked with a boards of directors, shareholders and

  • founders. Gary has strategic & operational

fluency in organic SaaS and M&A growth environments and is committed to excellence, the highest ethical standards, and a constant pursuit of personal self- development and improvement. Gary’s strengths include Entrepreneurship, B2B, Strategy Development, Product Positioning, Global Business Development, Team Building and Motivation, Growth Management, Focused Execution, Sales Funnel Development and Networking.

Gary Boddington

Director

  • Mr. Warren is a pioneering figure in

the digital currency and Blockchain

  • space. He brought the world its first

physical bitcoin brokerage and its first Bitcoin ATM in 2013. He founded and ran one of Canada's early digital currency exchanges and in recent years served as CEO of Xapcash Technologies Inc., and as Chief Operating Officer of BTL Group Ltd., an enterprise class Blockchain solutions company that trades on the Toronto Stock Exchange (TSXV: BTL).

Jackson Warren

Board Advisor

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Our Model

5% 2%

Virtual Bitcoin ATMs

5% markup (2.5% commission for store)

White Label & Franchise

Min 2%, or 20% of markup Place Order

Customer places order at Netcoins Virtual ATM: Cash or Debit

Collect Payment

Store / mobile agent collects

  • payment. 2.5% commission

built into Netcoins FX rate

Facilitates Order

Netcoins’ proprietary software performs a series of functions to facilitate order. Netcoins earns 5% (BTC markup).

Bitcoin Delivered

1 3 2 3

Bitcoin is sent & email receipt is

  • delieverd. Email is validated for

future marketing uses

Netcoins Transaction Flow

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  • 1. Visit app.goNetcoins.com

Sign in using your email address and account password Select amount to purchase, enter customer’s name and email address

  • 2. Ask customer for verification code

It was just sent to his/her email address Verification code is used to ensure that the email has been entered correctly

  • 3. Collect payment from customer & click

Place Order

You may also click to print a receipt (optional) Transaction history and preferences are available in the “My Profile” tab

Sell Bitcoin in 3 Simple Steps

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Business Model

Virtual Bitcoin ATMs 5-8% markup (2.5% commission for store) White Label & Franchise Min 2%, or 20% of markup

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Netcoins is Regulation Ready! KYC / AML

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Netcoins has been intentionally designed from day 1 to handle regulation

  • We expect and welcome regulation to the cryptocurrency transaction market
  • We expect it to give us a further differentiated competitive advantage
  • Netcoins is ready to enforce, via software, ID checks and transaction limits as regulated

Netcoins Virtual ATM is designed as a reseller-facing app (not consumer facing)

  • Requirement of validating ID can easily be met because of the human component.
  • Currency exchange stores have been regulated for years - and their business is strong

As Netcoins is launched with financial advisors / planners KYC is pre-built in

  • Existing customers have already gone through KYC to create accounts with their advisors
  • We will piggyback on this – one more way to ensure KYC for Netcoins

The downfall of Physical bitcoin ATMs is regulation

  • Not reseller facing – rather consumer facing
  • No easy way to enforce KYC / AML without a human interaction
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Financial Performance

Since commencing operations, Netcoins has seen tremendous growth in sales and is generating positive EBITDA

Netcoins anticipates continued revenue growth through 2018 with expected revenues of over $79MM

2018 Revenue

$79.8MM

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$242,891 $2,627,078 $4,313,510 $6,966,410 $8,211,000 $15,033,000 $23,880,000 $32,727,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018

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Monthly Transactions

Netcoins has demonstrated substantial growth in both transactions and revenue, with the forecasted transactions expected to accelerate

111 153 311 381 568 533 538 581 564 549 724 742 790 840 920 1,486 2,052 2,618 3,184 3,750 4,316 4,882 5,448 6,014

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Transactions

Actual Forecasted

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Monthly Revenue

Netcoins has demonstrated substantial growth in both transactions and total bitcoins sold, with the forecasted sales expected to accelerate

32,685 67,014 136,951 369,655 1,193,8201,057,3621,036,7731,475,3701,797,526 2,467,0802,085,0932,414,2372,516,0002,650,0003,045,000 4,028,000 5,011,000 5,994,000 6,977,000 7,960,000 8,943,000 9,926,000 10,909,000 11,892,000

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Revenue

Actual Forecasted

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International Exposure

By the end of 2018, Netcoins will have entered multiple countries with global revenue generation

2017 Revenue 2018 Revenue

Canada & United States $76.0MM Australia $1.0MM Europe $0.8MM Asia $0.7MM Latin /South America $0.7MM Africa $0.6MM Total $79.8MM

2018 Geographical Revenue

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Market 1: Individual Professionals

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Make-up:

  • Insurance Agents
  • Certified Financial Planners / Accountants / Advisors / Brokers
  • Real Estate Brokers / Agents
  • Any independent professional (or very small office) in the financial space

Size / Value:

  • More than 2.5 millions targets in Canada and USA alone
  • 14 transactions / month and $2500 per transaction
  • 2018 target: 1100 transactions / month worth $2.7M/month

Targeting:

  • Digital Marketing
  • Sub segment specific landing pages and ads, driven by Adwords, Bing / Yahoo!, YouTube, Facebook etc.

Selling / Closing

  • Inside Sales team
  • Receives lead in Salesforce, calls lead, books 15 minute online demo, pitches and closes
  • Hand off to Customer Success team to deploy
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Market 2: Independent Retail / Small Chain Stores

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Make-up:

  • Convenience Stores
  • Retailers (clothes, coffee, gas, books, health, electronics etc.) – anything with a traditional checkout POS

Size / Value:

  • More than 2 million (non-large chain) retail stores in Canada and USA alone *source: RetailCouncil
  • 20 transactions / month and $2350 per transaction
  • 2018 target: 1960 transactions / month worth $4.6M/month

Targeting:

  • Digital Marketing
  • Sub segment specific landing pages and ads, driven by Adwords, Bing / Yahoo!, YouTube,

Facebook etc.

Selling / Closing

  • Inside Sales team
  • Receives lead in Salesforce, calls lead, books 15 minute online demo, pitches and closes
  • Hand off to Customer Success team to deploy
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Market 3: Currency Exchange + Gold/Silver brokers

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Make-up:

  • Currency Exchange stores and chains
  • Gold/Silver brokers/exchanges

Size:

  • Estimate of 10,000+ locations in Canada/USA + global locations
  • ICE USA: 320 locations, Travelex 200 locations, etc.
  • 15 transactions / month and $8700 per transaction
  • 2018 target: 315 transactions / month worth $2.7M/month

Targeting:

  • Enterprise Sales
  • Generate target lists and contact via phone / email – multiple touch points as needed

Selling / Closing

  • Enterprise Sales team
  • Create lead in Salesforce, calls leads, book 30 minute online demos, pitch and close
  • Hand off to Customer Success team to deploy
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Market 4: Private ATM/ABM companies

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Make-up:

  • White label ATM companies controlling all non-bank affiliated (fiat cash) ATMs
  • They already have established physical space partnerships within retailers
  • This market also allows us to acquire the large chain retail stores via a “channel” instead of direct

Size:

  • More than 500,000 white label ATMs in Canada and the USA
  • In Canada, only 7 companies own the majority of the market (eg DirectCash)
  • 25 transactions / month and $100 per transaction
  • 2018 target: 2250 transactions / month worth $225k/month

Targeting:

  • Partnership outreach (VP Partnerships) via phone and email, and in-person

Selling / Closing

  • Online or F2F pitch, seeking a revenue sharing agreement
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Other Significant Growth Opportunities

Additional Cryptocurrencies

Adding Ripple, Ethereum, Litecoin etc.

Two - Way transactions

Adding an easy and automated way for consumers to SELL crypto currency via Netcoins

Acquisitions / Consolidation

Ability to consolidate alternative cryptocurrency companies to broaden reach 22

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Capital Structure

Issued & Outstanding

Common Shares1,2 111,709,851 Warrants3 8,799,845 Fully Diluted 120,509,696 ________________________________________

  • 1. Includes recently closed $14.05 million private placement $0.35 share offering
  • 2. Management and Director incentive stock options to be issued

3 7,000,000 share purchase warrants with $0.10 strike price for 3 years; and

1,799,845 finders’ warrants with $0.35 strike price for 2 years. 23

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Mark Binns mbinns@gonetcoins.com +1 (778) 628 7427

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Appendix: Background Slides

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What is Cryptocurrency

Request

Transaction is requested

Broadcast

Request is sent to a P2P network of computer

Validation

The network nodes validate the transaction

Completion

Transaction is complete

Added to the Chain

This new block is permanently added to the existing blockchain

New Block

Once added to the chain a new Block is created, accounted for in the ledger

A cryptocurrency is a digital or virtual currency that uses cryptography for security. A cryptocurrency is difficult to counterfeit because of this security feature. A defining feature of a cryptocurrency, it is not issued by any central authority, rendering it theoretically immune to government interference or manipulation.

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Facilitates Order

True Realtime Conversion

SW combs exchange

  • rder book to build

true quote (replaces “hot wallet”)

Wallet creation & Delivery

BTC wallet is generated (replaces

  • ptical scanners)

Automated Accounting

Stores receive bulk invoice, pre-auth debit is auto initiated (or online / bank payment)

Treasury Management

CAD funds are wired to maintain float in brokerage account

Private Brokerage

Institutional buyers have access to pre- payment ordering direct from Netcoins

Admin Panel

Full account control & back-office. Commissions / markups / limits, cyber security management tools

White Label

Netcoins backend enables operation in different currencies, languages and branding

Our Propriety Software Modules

1 2 3 4 5 6 7

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True Realtime Conversion

1 2 3 4 5 6 Tr True Realtime Conversion Wallet Creation & Delivery Automated Accounting Treasury Management Private Brokerage Admin Panel 7 White Label

  • Netcoins’ software engine combs exchange order books to build a true quote
  • Replaces “hot wallet” concept of buy BTC in bulk and being susceptible to market

swings

  • Netcoins is immune to price volatility and doesn’t take a position on Bitcoin price

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Wallet Creation & Delivery

1 2 3 4 5 6 True Realtime Conversion Wa Wallet Cre reation & Delivery Automated Accounting Treasury Management Private Brokerage Admin Panel 7 White Label

  • Bitcoin wallet is generated with the order and sent to the

customer

  • Elegant solution that replaces optical scanners in physical

ATMs

  • Synchronizing creation & delivery creates seamless

customer experience. Very popular for those new to Bitcoin because no prior knowledge is required

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Automated Accounting

1 2 3 4 5 6 True Realtime Conversion Wallet Creation & Delivery Au Automated Ac Accounting Treasury Management Private Brokerage Admin Panel 7 White Label

  • Custom built internal accounting &

management tool suite referred to as “The Warehouse”

  • Stores receive invoices, pre-auth

debits are auto initiated by software (or online / bank payment)

  • Complete payment infrastructure for

handling incoming wire transfers,

  • nline bill payee, Interac e-transfers

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Treasury Management

1 2 3 4 5 6 True Realtime Conversion Wallet Creation & Delivery Automated Accounting Tr Treasury Management Private Brokerage Admin Panel 7 White Label

  • CAD funds are wired to maintain float in brokerage

account

  • Treasury is maintained in dollars and only converted

into Bitcoin in real-time as orders are placed

  • Brokerage management process also includes

deposits in BTC (converted back to dollars) for fast

  • funding. Netcoins has partnerships with exchanges

and BTC suppliers / miners

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Private Brokerage

1 2 3 4 5 6 True Realtime Conversion Wallet Creation & Delivery Automated Accounting Treasury Management Pr Private te Brokerage Admin Panel 7 White Label

  • Buyers have access to pre-payment
  • rdering direct from Netcoins
  • Well suited to high net worth individuals

and institutional investors. Typically serving the $25K-$250K range

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Admin Panel

1 2 3 4 5 6 True Realtime Conversion Wallet Creation & Delivery Automated Accounting Treasury Management Private Brokerage Ad Admin Panel 7 White Label

  • Full account control & back-
  • ffice for Netcoins admin
  • Individual commissions /

markups / order limits, cyber security management tools

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White Label

1 2 3 4 5 6 True Realtime Conversion Wallet Creation & Delivery Automated Accounting Treasury Management Private Brokerage Admin Panel 7 Wh White Label

  • Netcoins backend enables
  • peration in different currencies,

languages and branding. CAD, USD, EUR, GBP, NGN and

  • ther trading currencies
  • Enables ATM operators to scale

using Netcoins as a franchise

  • perator

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