Auditchain began seeking traditional financing after it became clear last year that conducting a crowd sale for the AUDT Token would neither be productive nor prudent until markets improve. We have been and are currently in active discussions with numerous capital sources to lead a round of equity investment. We are also seeking a method to make a distribution of equity in Auditchain USA, Inc. to everyone who is now entitled to a distribution of AUDT Tokens.
In February of this year discussions began with a group led by Paul Ostling. After a series of challenging negotiations mediated by Chris Danusiar, acting as CEO of Auditchain and a member of the group, a non-binding term sheet was entered into whereby the group, agreed to acquire all of the assets and intellectual property held by Matreya.io LLC, pay certain liabilities and restructure the equity ownership of Auditchain which included the allocation of 15% of the equity to all previous contributors and 4.9% to Auditchian’s founder after giving effect to the issuance of additional equity in connection with a follow on financing. The term sheet also included the issuance of the AUDT Tokens to contributors. Additionally, the term sheet included the appointment of a new slate of members of the board of directors with Mr. Ostling as Chairman.
Following the execution of the term sheet, final agreements were delivered by the group’s counsel. The agreements were in the name of an entity not a party to the term sheet. In addition, the agreement failed to include the allocation and issuance of equity and AUDT Tokens to all of the previous contributors. When counsel to Auditchain proposed to revise the agreement and include these items we were informed that no changes to the final agreements were to be made. The group was informed that these agreements were deficient and could not be signed. Failure to consummate the transaction led to the notification of the departures of Chris Danusiar, Stuart Haber, Srinjoy Chakravarty and Luiza Romero from the project this past Friday. Attempts over the weekend to deal directly with the group have failed.
Despite the setback, we are optimistic that currently available opportunities for strategic development alternatives will be forged. Control of all technology architecture and source code was successfully obtained. The departing individuals of the team have made significant contributions to this project. We wish them continued success and also continue to welcome the group to participate in our endeavors under less extraneous circumstances.
We believe that the progress made in the previous six months has put us in a position to launch early versions of two minimally viable products; DCARPETM for Enterprise and DCARPETM for Stablecoins. DCARPETM for Enterprise is targeted toward the modern blockchain enterprise. DCARPETM for Stablecoins is targeted to fiat backed sponsored stablecoins. There are over 230 stablecoins in existence with an additional 200 expected by the end of this year. The asset as a class suffers from an integrity and assurance problem. They represent the most urgent need case and are also the simplest audit process to perform. Stablecoins represent the biggest immediate market opportunity for Auditchain. Active discussions are currently underway with several stablecoins, including a stablecoin trade association that could lead to a beta launch within months.
The AUDT Token contract was returned to the auditor for verification after remediation. We don’t believe its results will show any serious remaining issues. We are preparing to make distributions to all contributors following its launch on the Ethereum network and planning its integration into the first release of DCARPETM.
As we progress, we will release notifications and updates to the community via our official news channel on Telegram https://t.me/Auditchain. Furthermore, https://t.me/Auditchain_Community is now the Official Auditchain Telegram channel for the community.