Mr. Holger Arians reports

BANXA PROVIDES BUSINESS UPDATE, INTEGRATES WITH ANIMOCA BRANDS, WORLDLINE, LEDGER, AND MANAGEMENT INITIATES OPEN MARKET BUY

Banxa Holdings Inc. has provided an update on the company's progress over the recent weeks. Holger Arians, chief executive officer of Banxa Holdings, stated: "Banxa is seeing continued success from many key business wins, highlighted by new blue-chip partners attracted to Banxa's leading payments infrastructure. Looking ahead, we see long-term upward trajectory thanks to our local regulatory and compliance strategy that we have aggressively pursued over the last number of years in anticipation of this next stage of compliant Web3 growth."

General business updates

Banxa continues to maintain a solid financial trajectory in the current bear market conditions and has set achieving cash flow break-even as its primary objective. Some unaudited, preliminary financial highlights include:

• Unaudited total transaction volume (TTV) of approximately $73.2-million (Australian) ($46.4-million (U.S.)) and $74.8-million (Australian) ($47.4-million (U.S.)) in July and August, 2023, respectively;
• Net take rate has improved to now be consistently sitting above 3 per cent, due to increased operational efficiencies, compared with 1.8 per cent in fiscal 2022;
• Total liquidity and cash position at the end of August, 2023, stood at approximately $10.1-million (Australian) (approximately $6.5-million (U.S.)) and approximately $5.1-million (Australian) (approximately $3.3-million (U.S.)), respectively.

Furthermore, the company has updated shareholders on its considerable progress in growing its run-rate total transaction volume by activating new major partnerships with noteworthy partners and other business updates:

• Ledger, a major, global non-custodial wallet with millions of users, has integrated Banxa to offer its users on-ramping services as of Sept. 12, 2023.
• Web3 gaming conglomerate Animoca Brands has integrated Banxa's NFT Checkout and crypto payment infrastructure to its Australian Football League (AFL) Mint. The partnership went live on Friday, Sept. 22, 2023.
• In August, one of the world's largest payments and transactional service providers, Worldline, integrated Banxa successfully to its Payment Orchestration, allowing all Worldline merchants to be able to activate Banxa's global crypto payment infrastructure instantly. Banxa is now working with Worldline to activate its merchants and initiate new partnerships together.
• Banxa now holds 32 money transmitter licences (MTLs) in the United States and is expecting seven more MTLs to be granted in 2023. Banxa does not require MTLs to operate in 10 states/territories. Accordingly, Banxa is already capable of servicing 42 states/territories in the United States.

Banxa also continues to deepen its relationships with key partners such as MetaMask, one of the largest digital wallets with more than 20 million users, to launch new features aimed to increase user experiences, conversion rates and, ultimately, transaction volumes for both parties. An example of this is the recent exclusive rolling out of one-click ApplePay on MetaMask.

Management market buy

Members of the company's management team, including Domenic Carosa (chairman), Mr. Arians (chief executive officer), Zafer Qureshi (director and head of corporate affairs), Patrick Maguire (chief financial officer), Richard Mico (U.S. chief executive officer and global head of legal, risk and compliance), Gregor Cooney (chief marketing officer), Damien Di Cosmo (head of people and culture) and Phil Brown (U.S. chief compliance officer) will participate in a round of open-market share purchases over the coming days. These purchases are being made in adherence with Banxa's company share trading policies, and they have been preapproved by the chairman of the board of directors. Participating team members will file reports with SEDI in a timely manner.

Additional business updates

To support Banxa's growing transaction volumes, which require working capital to fulfill orders (where settlements to Banxa by payment service providers are delayed in some instances by up to four days), the company is pleased to have continued support from its current and new working capital facility providers. These parties have entered into an unsecured credit agreement:

Qureshi family office:

• Alam Group of Companies Inc. (Qureshi Family Office), Mr. Qureshi's family office, has agreed to provide $500,000 loan to the company's wholly owned subsidiary, BTC Corp. Pty. Ltd., with the following terms:
  • Interest rate of 25-per-cent APR (annual percentage rate), calculated daily and paid in cash on a monthly frequency;
  • Beginning on Sept. 7, 2023, with a term of six months.

Buzz Developments Pty. Ltd.(Buzzworks):

• Buzzworks has agreed to extend the loan term to July 10, 2024, for a $1.5-million USDT/C loan with the company's wholly owned subsidiary, BTC Corp., with a 25-per-cent APR, paid in cash on a monthly frequency.

HB Super Holdings Pty. Ltd.:

• HB Super Holdings has agreed to extend the loan term to Feb. 29, 2024, for a $266,069 (U.S.) loan with the company's wholly owned subsidiary, BTC Corp., with a 25-per-cent APR, paid in cash on a monthly frequency.

Ari Last:

• Mr. Last, a team member of Banxa, has agreed to extend the loan term to Nov. 14, 2023, for a $400,000 USDT loan with the company's wholly owned subsidiary, BTC Corp., with a 25-per-cent APR paid in cash on a monthly frequency.

We seek Safe Harbor.