Abaxx Technologies Inc

Thanks. Well, good morning, everyone, and good evening for those of you joining us from Singapore. Welcome to the APEX Technologies and APEX Exchange Q1 2025 Corporate Update Call. During today's call, I'll reference disclosures from Tuesday's Q1 2025 Quarterly Business and Corporate Update and last week's filing of our 2024 Audited Annual Financial Statements and related filings on CDAR+. By reference to these press releases and disclosures, I also want to draw your attention to some of the specific cautionary statements and notices that accompany each of those releases, respectively, and to start off this call today by referring to our caution on forward-looking statements and the regular risk disclosures of our quarterly and annual filings. Please see our disclaimer on forward-looking statements in the slide attached. In addition, given the highly regulated nature of our products and operations and the early growth stage of our ramp-up and listing of new products as the year progresses, it's also important to reiterate the cautionary nature of our forward-looking statements with respect to products that are still subject to ongoing regulatory work and review. I will endeavor to point out these cautions as we go. But as of today, our Abbott Singapore entity's regulatory status is that of a recognized market operator exchange, an approved clearinghouse in Singapore, with futures products currently trading in physical LNG and VCM carbon, and as of Q1, the launch of our metals businesses in lithium carbonate and nickel sulfate. Any other potential products discussed today, including potential new markets planned for gold and precious metals, base metals, weather derivatives, and smart commodities, or even some of our innovative technology-enabled products, these new products would be subject to meeting all regulatory requirements. We will also speak about our upcoming gold products today. And up front, I want to specifically point out that AVEX Spot is a newly incorporated business in Singapore in Q1, but operating under a different branch of the AVEX corporate family tree and not part of our Monetary Authority of Singapore regulated entities of AVEX Singapore, AVEX Exchange, and AVEX Clearing, as MAS does not regulate spot commodity markets. For those of you who are new to the company on the call today, we've hosted project update calls semi-regularly around key milestone quarterly ends and did not specifically speak to financial statements or financial guidance directly. The company is still in an early operating transition stage, ramping up commercial operations and revenues, so we'll increasingly transition this quarterly call to that of a typical financial key performance indicator presentation in quarters ahead. But in today's call, the majority of the material updates will be focused again on onboarding KPIs and trading updates, product pipeline updates, and other technology and product milestone-related developments. So as in recent calls, the call today is intended to serve as a review of recent disclosures in a forum for investor and analyst Q&A. It looks like the Q&A portion of the call today will again be heavily focused on the commercial ramp-up of the ABIX Exchange and Clearinghouse, updates on our contract adoption and onboarding of participants across LNG, environmental markets, and battery metals. But in today's prepared statements, I want to specifically lay out the corporate update and milestones presentations as they relate to our two primary value creation objectives for shareholders. First, our near-term business and financial objectives that make us a sustainable business, i.e., the revenue growth and transitioning of our operating businesses from a company that builds things to a company that sells things, both in commodity derivatives and markets and software. And second, our continued development of new nodes in a global trading and clearing network. or in other words, continuing to onboard and build out all of the so-called market plumbing and market distribution infrastructure that will enable ABEX markets to achieve our medium-term goal of eventually joining the ranks of the million-plus average daily volume club as a true global market, and therefore realizing our current addressable markets for global gas, new metals products, as well as commercial distribution network, for our software and the ABEX full digital title collateral service network as envisioned by our founding mission. As you can see from all the immense amount of activity and successes we've had over the last four or five months in developing products and adding new nodes to our network, as laid out in our press release on Tuesday, there is no doubt as to the quarter-over-quarter, year-over-year progress in the strategic development of the operating assets and commercial network of the ABEX group. a company that continues to execute at an extremely impressive global level relative to our overall capitalization. But it's also clear that we need to spend more time contextualizing each of these development updates into both buckets, not just the long-term infrastructure and network development, but also getting more granular on the near-term successes and challenges of transitioning the core part of the business to sales and trading volume growth. So today we'll spend more time outlining what's required to grow near-term volumes and revenue through the remainder of 2025, even as the longer-term technology vision starts to become a reality this year and as we continue to onboard new nodes to the network. From recent stakeholder discussions, both internally and externally, I've come to realize that framing our updates in this way, both unlocking a near-term revenue and trading volume trajectory, as well as the development of the network and strategic asset, This dual mandate is critical for understanding the path of AVEX through the remainder of 2025 and understanding the road markers ahead for our existing markets, our new product additions, and our new software updates along the way. As I believe I mentioned on the last call, borrowing and paraphrasing from Howard Lutnick's description of building a new exchange as a year to onboard, a year to build liquidity, and then we really start competing. I want to break down that process in a little bit further detail to discuss the major milestones we hit over the last quarter with our first trades in lithium carbonate and nickel sulfate, incredibly important work that's been ongoing in the distributing of our prices and market data over the past quarter, and the very significant milestones announced at the end of March of a physical LNG trade using AVEX benchmark prices. On today's call, I also want to discuss some of the new futures products additions that we have in the 2025 Roadmap and Pipeline, and present them with a new category framework to help stakeholders understand how each new product can potentially add to near-term volumes and revenue, as well as how new products expand the access nodes to our network and help achieve both of our objectives. We're currently focusing on products that can potentially achieve quicker ramp-up volumes than the brand-new markets built from scratch, like our physical LNG and battery metals, and therefore products that can also add new liquidity nodes for both new and existing contracts listed. I'll touch on this new categorization in more detail as we outline the product pipeline, but basically there are three types of markets in our roadmap. Again, the brand-new greenfield physical products, like the ones we've just launched and are currently building from scratch, Second, there are what I'd describe as step-out markets, the first of which will be our new gold market, where it's still a new market, but it functions very similarly to other existing markets and will need less product education and less global connectivity nodes to build the liquidity. And finally, various spreads, indexes, and look-alike markets that we plan to roll out over the course of the year and can likely tie into existing pools of market liquidity much more seamlessly than the new physical markets or regional step-out markets developed from scratch. So we'll discuss how these different product categories can each help to achieve both of our objectives, products that can potentially achieve quicker ramp-up volumes, even on a smaller network of onboarded nodes to date, but also products that can grow and attract new nodes or tip some of the firms in our onboarding funnel over the line for joining because of the multiple offerings. Thus far, the new greenfield markets like LNG, for example, our flagship, have been facing the dual challenges of market development penetration at the same time as our onboarding connectivity still has to be built out further for the global liquidity to take hold. That all said, I think it's important to point out from our roadmap perspective and that of some of our major strategic investors, growing the asset value of ABIX is not just predicated on the next 12 months of volume revenue growth. While our company is absolutely in the transition phase of becoming a streamlined and process-oriented sales and client service company, and we're already in the midst of a number of management and process optimizations to better service onboarding and grow trading activity, the strategic value of the company continues to be the long-term development of the network connectivity infrastructure, the plumbing that will allow us to launch new products demanded by the market at any time once the access and distribution is global and on par with other exchange companies. A clearing network as an asset is a strategic business in core global commodities and trade collateral management, which continues to be the focus of our long-term shareholders and strategic partners. And finally, thinking about this dual mandate of network building, as well as our near-term revenue growth objectives, over the next few quarters, I believe it will become increasingly clear to stakeholders how our ID++ and APEX digital title development work is not just a tangential software service, but core to the strategy of unlocking inefficiencies for our clients, adding network value to our ecosystem, and generating new potential revenue streams for our exchange and clearing business. I've often talked about the concept of a fully integrated greenfield fintech business, the so-called full-stack venture, that rare type of business that can first develop a commercial footing within an entrenched incumbent network, be it an entrenched distribution network or a highly regulated and protected industry, and then push software innovation from the inside out to lower customer friction, increase commercial speed and efficiency, and in our case, lower the intermediary risk for commerce. We believe that the time is now for upgrading the global post-trade and commodity-derivative collateral ecosystem, and in Q1, ABEX has reached the second-stage milestone of a three-phase development for engineering and testing our proprietary software technology to achieve these objectives. Over the coming quarters, we'll be publishing more about the planning and execution of our pilot work for a better way to move commodity collateral with ID++ in the ABEX technology ecosystem. So, again, having reached this operating growth stage in both parts of our full-stack technology and operating businesses, and now that ABIX is one of a handful of commodity futures businesses globally with our own independent clearinghouse and a major financial center, we should have a number of updates to share on both aspects of the business over the next few quarters. But for now, we're also very focused on the objective of growing volumes so we can cover that a lot more in the Q&A. And finally, speaking on behalf of the Avex Global team, sometimes it's hard to contain our excitement on how things are all coming together here in 2025, but I should always caution that all of this forward-looking innovation would be subject to meeting regulatory requirements and navigating the complex technological adoption cycles of our institutional clearing and exchange members, which we've only started to navigate with live software products. So turning to the agenda, and sorry for the longer introduction than usual, but on today's call, I will go through recent disclosures more quickly than usual and jump right to the Q&A section with the rest of the team. Joining me on the call today are Chief Commercial Officer Joe Rea, Chief Strategy Officer Dave Greeley, and CFO Steve Frey. Today's agenda will present it a little bit different than previous calls. as I'll really just focus on our commercial and operating updates in my prepared agenda. And then we'll push more of the technology and corporate financing discussion to the Q&A section. That said, we did have some big milestones and updates this quarter on ID++, the ABEX console suite, and full digital title technology, which sets us up for an exciting back half of 2025 as we move to pilot trades and the operating phase. But I think it's better to address that update through the incoming questions. We're also just concluding a second tranche of an important $33 million financing that extends our growth and working capital with additional development runway into 2026. And we've also passed our peak OPEX headcount and total compensation spend over the last two quarters. And we will look to streamline our transition to normalized operating costs for operations over the quarters ahead, which we'll also cover in the questions coming into the Q&A. For institutions and analysts who are new to ABEX on the call with us today, as I go through our prepared operating updates, for further context, I would also encourage you to listen to our previous project update calls, which are on the ABEX IR website and our ABEX YouTube channel, drawing specific reference to the product presentations from David Greeley on LNG and futures addressable markets, which is our approach to addressable markets and ramp-up in general, the ID++ and ABEX console suite demonstration from Ian Forrester, my description of the full-stack technology layer cake in November's call, and my discussion of our strategic approach to operating off of two balance sheets and two distinct but complementary business units, AVEX Exchange and Clearing, which I'll also refer simply as AVEX Singapore, and AVEX Technologies. It's through this sum of the parts we can realize our long-term smarter markets vision and strategy for changing the way commodities are priced and traded to allow the invisible hand of the free market to better discover in price and distribute the positive and negative externalities of the natural resource sector, particularly in this time of unprecedented trade volatility and a potential reordering of global energy and metal supply chains, which is ongoing in real time this quarter. all of which require smarter risk management tools and new market builders that we've assembled at ABEX. So first up, getting into the commercial update, we've had an extremely busy four or five months since our last investor call, with a number of key milestones achieved and a number of important new nodes added to our network. And again, focused on both objectives, let's get into how these updates can also help opening new revenue lines as the year progresses. As you all know, on G28, 2024, we launched the ABICS Commodity Futures Exchange and Clearinghouse in Singapore with trading commencing in physically deliverable liquefied natural gas and carbon futures contracts, a total of five new markets. And in Q1, we added four new futures markets and battery metals with three physically deliverable lithium carbonate contracts and nickel sulfate futures. Our current suite of U.S. dollar-priced futures contracts across LNG, battery metals, and carbon are open for trading 14 hours a day, Monday through Friday. But stay tuned for some innovations we'll work on to expand our hours, currencies, and settlement infrastructure in the quarters ahead, especially once our AVEX digital title product is fully integrated later this year, subject to meeting all regulatory requirements. The most important commercial highlights to point out are the first trades in nickel sulfate and lithium carbonate futures during Q1, including the world's first trade of a non-Chinese U.S. dollar-denominated and physically deliverable lithium carbonate futures. The company also saw its first OTC LNG cargo indexed to ABEX LNG futures, which was a major milestone for ABEX, reflecting growing confidence in ABEX's prices as a benchmark contract. This announcement in particular initiated some of the most active engagement for accelerating the onboarding activity and inbounds from the LNG community since we launched the markets. We also established active bids and offers in all three LNG contracts and both carbon contracts across our trading hours, which combined with all of the new developments in market data and distribution now allows potential clients to build their own tracking and market assessment tools as they onboard to trade our products and allows the inter-dealer brokers the market ranges to work our products through their sales channels when brokering physical and block trades as well. And on the market data front, we finalized onboarding with our first major global distribution network, expected to expand the visibility of ABEX markets to over 100 million viewers. In total, we added our first six market data partners in Q1 2025, which, again, was not really available before establishing active markets across all of our markers. Beyond this initial six, we're now progressing with basically all of the major financial data platforms so that any financial professional can pull our prices just as seamlessly as they do with other major global commodity instruments. This is an important development milestone in the hard plumbing and distribution of our markets and all future products that will no longer require this one-time build-out. Looking ahead with additional deals in the pipeline, We're getting close to the market equivalency needed for broad price visibility by the summer, or right around that one-year milestone of core onboarding. With so much complexity and chicken-and-the-egg dependency loops in building markets, we probably didn't spend enough time previously in talking about this aspect of the infrastructure. But it's obviously important for both building the asset value from a network node perspective, but it also opens up a future revenue channel as market data is an important part of the exchange business model. As we've discussed on previous calls, in the early days, the data is used in more of a strategic way than just selling a monthly data subscription fee before our markets are liquid. But this is a future revenue lever that starts with the partnerships executed over the past quarter and more onboarding in the funnel. Another important commercial development to highlight is an inbound discussion we've engaged that's looking to utilize our clearinghouse for third-party clearing services. Now, it's important to note that I don't want to get too far out ahead of this one before putting in more regulatory work. But the basic third-party clearing model is that this is a non-competitive product exchange that would integrate their markets with our clearinghouse. And in this specific group's case, they could potentially help with onboarding additional bank and non-bank clearing members to our clearinghouse for their products and ours. And AVEX would earn a per trade fee on all of their daily cleared trading volume. In this model, particularly if it's a highly liquid, high volume market, this can significantly add to both our business objectives, adding immediate daily volume and revenue line items, as well as a new onboarding pole that builds out the nodes in our long term network. Again, it's important to speak generally here as there's still a lot of system, regulatory, and commercial work to be done. But it's important to introduce this potential real option value of the infrastructure and technology being developed by ABEX. To support commercial growth in Asia and Q1, ABEX expanded marketing efforts in China, including the launch of a dedicated Chinese language website and the announcement of a co-hosted Mandarin language battery metals seminar with Shanghai Metals Market. The team also engaged in exploratory discussions with external exchange groups based in China to collaborate on a cross-jurisdictional, i.e. onshore-offshore, product listing opportunities with ABEX Exchange and Clearing. Again, on the potential for cross-listing business, this would be subject to additional regulatory work in line with other new product developments, but could open a potential revenue share opportunity for licensing our products to be traded onshore China on a per-trade fee basis, as well as new product listings on AVEX Exchange that have established Chinese market as an index price that could potentially increase trading and network build-out of our own exchange and clearinghouse. Turning to onboarding progress, full clearing and execution are currently accessible through three clearing members, Stonex, KGI Securities, and ADM Investor Services, with three additional futures commission merchants, or FCMs, in Mizuho, Merix, and Straits Financial, providing indirect access to our market for brokers, market makers, and commodity trading clients. Four additional clearers that include global bank clearers are currently in progress to establish new clearing connectivity. We plan to cover the FCM topic in more detail in Q&A, but it's important to note the initial volume seen in the first few quarters of connectivity and ramp-up are still working through some full client access and connectivity blockers with a few of our FCMs and clearing members, and some of the ABEX products are only available to a limited number of the initial execution brokers and their clients in some of our core launches, and were not available in all global regions in some of the early sessions. Joe Ray and I can walk through some of the updates and steps were taken to remove some of the continued blockers to build initial access and liquidity in our markets. 29 trading firms comprised of merchant traders and financial trading firms are now fully onboarded to execute block trades, with 12 additional firms currently in the onboarding process. Clients connected to ABEX continue to be able to access ABEX markets through central limit order book, And 14 inter-dealer brokers, or IDPs, are onboarded with 12 more in progress. So we've had another strong Q1 for trading firm and inter-dealer broker onboarding. We continue to have a substantial commercial interest for our products, despite some of the connectivity and onboarding frustrations. And in mid-Q1, we initiated an end-to-end onboarding process review to help smooth out some of the ABEX side trading forum process, as well as FCM network communications. Again, we can talk through this more in the Q&A. Turning to new futures product developments, we've had another strong quarter for new product development, and I would reiterate that new internal classification we're using to describe these products. Unlike our nine existing contracts, where each one is a brand-new physically deliverable market being built in sectors not always familiar with physical delivery futures, Outside of our gold product, much of our next slate of products are specifically being developed with industry clients as new cash settled index futures, spreads, and lookalikes that can be a lower barrier to entry for trading and adoption and can more easily draw on existing pools of market liquidity and risk management. Specifically, we advanced a regional copper spread futures contract to the listing pipeline, a suite of weather derivatives, and carbon market contracts aligned with regional compliance programs, each currently in our final stage three of new listings and regulatory work. Certain weather and compliance carbon futures are expected to become the first ABEX contracts priced in currencies other than U.S. dollars. As part of our innovative new gold market structure, which is not quite a greenfield market, more of a step-out market, which will be very familiar to gold market participants in many other regional markets, we do believe that we can build trading and network effects in our Singapore broker and FCM community with less of a global onboarding node requirement as our other greenfield global markets. On the product specifically, we've submitted our regulatory work for a one kilobar Singapore gold futures contract to support Asia's kilobar market, an offering not currently matched in London or New York. In parallel, we incorporated ABEX Spot, a separate entity designed to support convergence between futures and physical gold markets. While the gold futures contract will be listed by ABEX Exchange, ABEX Spot, not regulated by MS, enables electronic settlement and physical delivery of a 99.99% purity kilo bar in Singapore through a secure, transparent gold pool. Onboarding momentum for our gold markets continued through targeted on-the-ground engagement and at commercial events globally. We've also progressed a number of important developments in our exchange and clearing systems development, risk and regulatory work, which I'd refer you back to Tuesday's disclosure for more detail. But I'd just like to highlight a few here. ABEX Exchange submitted its application to the U.S. CFTC for recognition as a foreign board of trade. Once granted, this recognition would enable U.S. trading participants to directly access products listed on the ABEX Exchange. In February, the company completed a public consultation on rule amendments to support the introduction of additional currencies as acceptable margin collateral. These amendments are now under regulatory review, with the final list of approved currencies to be announced in due course. We also expanded system capabilities to support multi-currency settlement and collateralization. With the project projected to be complete by May 2025, And we also completed the upgrade of Verifier Plus into the ABEX trade registration platform after successfully developing the more robust mobile application and ID++ infrastructure in earlier use with Smarter Markets Coffeehouse testing. This was another important milestone in the integration and implementation of our proprietary ID and digital signature technology, which will be required for the ABEX digital title infrastructure. As I mentioned earlier, on today's call, I'd like to push a lot of the ID++ and digital title discussions to the Q&A portion of the call, as we've spent a lot of time talking through the AVEX software innovation strategy on the previous two investor calls. So I encourage you all to listen through those recorded sessions if you'd like more details, a detailed run-through of the strategy. Touching just briefly, though, on the milestones updates we've released, ABEX Tech released upgrades to the ID++ protocol and Verifier Plus in Q1 2025, including integrations with ABEX Exchange and Smarter Markets Coffeehouse. The ABEX Messenger is in its final stage of pre-release testing ahead of deployment and initially as a user support tool for ABEX Exchange in Q2 here. Future development for this initial release is complete with improvements to maintaining performance at scale now in testing. These include faster load times for messages, improved performance under load, and inference tools that help support teams manage multiple ongoing conversations. Development of AVEX 1 was initiated as a middleware solution connecting enterprise identity systems such as Auth0, Okta, and Microsoft ID systems into AVEX ecosystems, and importantly, as another seamless onboarding experience into ID++ and the AVEX private network ecosystem, which will be required for our digital title product in upcoming pilots. And finally, Abbott Sign reached its initial functional milestone and is now progressing through an internal testing and design partner feedback cycles for deployment ahead of our pilot tests as well. Speaking to the initial revenue opportunities on these software products, while ABEX Messenger's first deployment as an exchange support tool would not be a paid per-user seat license model, it does allow exchange users their first onboarding and product experience with the platform, opening a first enterprise sales channel for future SaaS revenue as we roll out additional features, particularly in use for digital title workflows and brokering ABEX trades. The completion of Avex Messenger as a hub and spoke platform support tool also opens up the potential for our first third-party license opportunity of the suite as an add-on feature to software partners like Mindhub. And remember, Messenger will also be used as a cockpit for our future AI tools and the rest of the Avex console and digital title products. In that state, The revenue model for AVEX software tools would be that of a typical monthly per-user license fee and in-platform upgrade service. And finally, it would also function as the initial sales and access funnel for another per-transaction revenue model in use as the pre-trade and post-trade platform for our vision of a collateral settlement technology. So with that, I want to wrap up with a more formal presentation. And for today's call, we can move the rest of the tech, commercial onboarding, and corporate finance discussions to the Q&A portion of the call. So I'll now invite David, Joe, and Steve on the line and turn it over to questions.

Thank you. Thanks so much, Josh. And I'll walk through some of the questions. Just a reminder, we received quite a few questions over the past few days through the investor relations inbox. We'll be giving those priority. There are also quite a few questions coming in through the call. So I may need to group some of these together just so we can try to hit the topics in the heart of the questions in the time we have with you today. Okay. The first question we have really is about regarding the investment strategy. And that's asking if you could elaborate on how ABEX prioritizes its investments between the technology development and the market expansion. And what are the specific criteria used to guide these internal resource allocation decisions?

Yeah, look, it's a great question. And again, we've Probably gone to that in more detail on previous calls, talking about kind of the two balance sheets and the approach. Again, I always want to reiterate that, you know, the priority and the highest, because this is really a multi-phase development, you know, the highest priority and the bulk of the spending over the last, you know, five, six years is obviously to AVEX Singapore. And again, because we've got a small minority interest there, you can actually see the inner company investments into AVEX Singapore. So given that that's the first phase. I would say that over previous years, we look at some of the ID++ technology, although we're obviously very focused on the long-term development there. I would have called it a little bit more R&D, and some of it's been classified that way. But I would say, again, really as of this quarter, where we're deploying that technology live into operations and now into regulated operations, this really is becoming a commercial infrastructure and not just R&D. So we will see that more as one integrated business strategy going forward here. It really isn't necessarily built to be AVEX Tech is for multi-party where AVEX Singapore is just the exchange. You know, the core commercial strategy is always for that one common, you know, vision of building out a global network that's both for trading and, you know, pre-trade, post-trade and collateralization, digitization. So our, you know, our first customer has always, you know, always been APEX Singapore. And, again, this I would say over the, you know, really over the remainder of the year, this is all one. We've always operated as one integrated company, even though the strategy allows for other flexibility. But this year in particular, you know, we are just one company, you know, solely focused on the, you know, the two mission goals that I mentioned, you know, in the prepared statements, right? One is, you know, turning all of these operations into revenue. And then two is using all of these technologies, tools, and new products to build the global nodes of the network. I very specifically call it network nodes, as in probably the next presentation that we do. you know, as an investor presentation. And I will, you know, put Taft Nanga, our head of corporate development, on the spot here because he's been vibe coding an amazing network model that I think will help show, you know, show what this nodes more visually and what the value creation of that network is. We'll do that in future calls. But, you know, really we've identified something like 800 firms globally, and we built out a network model to understand how those connect and create value so we can create those pools of liquidity in all of our products. So, anyways, it was another long answer to the integrated approach to building ABEX. But, again, increasingly this is one company with one mission, and I think that will be more clear over the next couple quarters.

All right. I think there are quite a few questions from our investors and stakeholders looking to understand that pathway to revenue. And I'll start, I'll group them together. There's a number on onboarding and connectivity. So the first question would be for Abix Exchange, what are the key strategies for addressing the challenges typically associated with entering new markets and expanding your global presence?

Maybe Joe, can I hand that one to you?

Josh, yeah, the strategy hasn't really changed since the beginning in that clearing members are certainly one of the most, if not the most important part of our onboarding strategy and work to do. New clearinghouse, new products, new exchange are all important. difficult hurdles to get over. I think given that we have six firms that are clearing firms that customers can connect with is one of the most important successes that we've had. And we continue, as you've mentioned, to engage with bank clearing firms that are equally important for our customers that are reaching out to us that have asked us to list new products and to connect with. So that is really the most important thing. We engage with them constantly. Our customers engage with clearing firms constantly. And the products that we'll be launching will only increase the surface area of the clearing firms that need to connect with us. And I think you touched on this, Josh, also in your remarks, in that by adding new products, we We'll bring on various trading entities within trading companies that will look to trade our products that will only spread across the other trading entities within companies to increase their onboarding. So you mentioned 800 firms. It's probably even double that of the firms that we're talking to. There's brand awareness out there that we get great high marks from the marketplace online. on building brand awareness of AVAX in general. And I think that that's only going to increase the opportunities for us for not only new products, but also new clearing members and new customers to come on board with us.

Thanks, Joe. And we have another question geared to trying to understand the specific strategic benefits and expected impact on market liquidity and contract adoption associated with onboarding different types of participants. For example, a bank FCM versus a non-bank FCM, merchant traders versus financial traders, etc.

Maybe I'll take this and then hand it over to Joe to just add a little bit more context. You know, I didn't want to specifically get into the prepared remarks, but, you know, I take something like, you know, like our lithium carbonate futures. You know, it was abundantly clear, you know, from global media. all of our client conversations, that this is an incredibly needed and useful product, particularly given everything that's going on in the world where lithium carbonate is generally dominated and priced in China. When you look at the survey assessments and indexes that are being traded in other exchanges, yet our contract is deliverable for Baltimore. Now, obviously, Traxxas is a major player in the battery metals, is both an investor in ABEX and a partner in some of the first trades. But we've also been working to onboard other of the largest metals traders in the world. And unfortunately, they weren't ready for the first trade. It obviously has no relevance to the fact that they want and need this product and help develop it. Again, it's still in the plumbing and onboarding process that we're working through. So, yeah, Joe, maybe going back to the original question, you want to kind of explain how different parts of this – I mean, obviously the FCM and the core connectivity for settlement and clearing is critically important. But, again, there's many, many players that make up this ecosystem. Yeah.

Yeah, and these are nascent markets. These are so new in their infancy. You look at lithium carbonate, and you look at the universe of trading firms, and nickel sulfate, I would argue, is even smaller. So you're talking to firms that some of them have never traded futures before. They know they want to manage their risk. They want to have transparency in the markets. You have an ecosystem of the trading firms, the clearing firms, and brokers. This market is mostly a brokered marketplace. And so the brokers that are new to lithium carbonate may have been brokering LNG or carbon or other products, and they're only just stepping into the battery metal space in general. And so that collective onboarding is happening as we speak. And it's an important part of the process that people need to understand how difficult that is. You have firms that have never traded lithium. lithium before that are getting involved in it just based on their investments in this marketplace. And some of them are some of the biggest names in energy markets like ExxonMobil and Ecuador and Coke Supply and Trading. All those firms that are Trading firms in energy markets or other commodity markets are now getting involved in lithium. And so that only just brings, again, as I said earlier, new trading firms on board, new broker firms on board, new clearing firms on board. And that collective kind of Rubik's Cube of onboarding is happening as we speak. And it's just a – it doesn't happen certainly as fast as maybe a lot of people want, including us, but it does happen and it is happening. And that's an important thing to not lose focus on.

And I think a good follow-up to that question would be this next one, which was, how does the current pace of clearing member and trading firm onboarding compare to your expectations and targets for this initial phase?

I'll probably start with mine. Joe obviously has a lot more industry experience, but yeah, I mean, look, I think, you know, just based on some of my previous comments, it's not as rapid as we like, but yeah. Again, this is an environment where we are kind of a one-of-one company doing this at a global basis from scratch, right? As one of the first new clearing firms licensed and built kind of in this greenfield way in decades, there's a lot of process, particularly given the global risk environment and these sort of ongoing rolling crises in financial supply chains. It's a new environment with a lot of things that we, you know, a lot of hurdles, the unknown unknowns that come at you. But, again, like the end clients and doing things that no one else is doing is what continues to drive us. And, again, it's over the five, six years we've been doing this. There is no doubt that our products are demanded by the traders. It's all the infrastructure between the trade and actually executing the volume that, you know, just continues to be knocked out. And that's, you know, that's where I got into things like that we haven't described in the past, like the distribution of market data. Right. You know, other than going to our X account or emailing us directly, how do they find our prices? Right. How do you compare it to prices? How does that become part of your market checks and your arbitrage opportunities? Right there. You know, but and you can't even do that until you have market making and you've got bids and offers all the time. How do you have bids and offers before you have a market? Right. So so like these are the things that every quarter we're adding value and allowing this this ecosystem to evolve. Right. And and so, yeah, it's probably not the timeline we would have liked. But, you know, I just keep going back. You know, the value of what we're building, both in solving commercial needs globally and the value to stakeholders is. of a business of the scale of our vision is a very, very high ROI investment, no matter how long you want to stretch out this timeframe within the next few years. So that's what the investors are focused on as we continue to raise capital on new milestones. And it's not fast enough, but it's a high ROI in our view. Joe, you know, maybe given your experience, you know, how would you describe the timeline here?

It's never fast enough for me, certainly. I think everybody knows that on the team. We want to step on the gas as fast as we can, but we really can't move any faster than clearing firms, which are really the most important part of the ecosystem for us, for them onboarding. The fact that we have six is quite remarkable, I think, and a testament to the risk systems that we've built, the products that we've launched. and the team that we have. But, you know, the couple of us that have had long-time exchange experience, including Dan and myself, we know how hard this is, and we know how important it is for the marketplace to get these products out there. They're not being addressed by other exchanges, and the marketplace clearly has come to us and asked for them. So they're – bothering as much as possible their clearing firms to get connected with us. And we're always looking for alternatives and way to do that. And so, you know, we're committed to the FCM model and we want them to be partners with us in this. And we just, the market has to be just patient that we, and as much as we're impatient to know that this takes time, unfortunately, but we know that we have the right model. We have the right products. We have the best team in the marketplace to, And we know that once we succeed, this will be a – we'll look back at this and kind of laugh and say that, you know, why were we worried about that back in the day? So this is an important part of the process is to continue to be engaged with the marketplace. And, again, I think that looking at all the interactions that we have with all of the customers across all of our ecosystem, we know we're moving in the right direction.

Thanks, Joe. We also have a question on some of the improvements to the exchange systems. One question is about the ability to settle trades in other currencies besides the U.S. dollar. And the question is, you know, once this is in place, will ABEX be the only exchange that has capabilities like this? How important is it? And what types of traders does it allow us to attract and products for the exchange?

Yeah, look, it's a good question. And again, the major global exchange groups, particularly in commodities, have this ability. Oftentimes, they've got multiple clearinghouses spread around the world and different natural currency regions and so forth. So obviously, it's quite a complex network. But what I would add is probably we've, as a Global first, you know, digitally native, remote first type of company. You know, I think we're probably the only ones that have built this green field on a global basis, which, again, makes it extra difficult. But, you know, we do also have the benefit of being able to build that in a new global technology environment, right? You know, obviously a global exchange, you know, business, you know, settling collateral, right? You know, built, you know, on-prem, you know, local, you know, local servers, local jurisdictions, older infrastructure is very different than building a global, you know, ultimately an exchange is a technology business. Obviously, there's going to be a lot of legal and other market infrastructure jurisdictional issues. But from a pure, you know, sort of interconnectivity of our software network, you know, we've been built at global and multi-currency levels. have this global multi-currency thinking from day one. Now, of course, that all said, you know, as I mentioned in the prepared statements, there is a regulatory local process to this, right? There's, you know, there's obviously the regulatory submittals. There's the questions and review periods. So, you know, we obviously – In global commodities, you know, you abstract to this being one global market. But, of course, you know, the legal reality of any market is its jurisdiction by jurisdiction and how the legal and regulatory matches, you know, hit as you, you know, move a ship across water, for example. And that's the same thing with currency settlement. We tend to think in this abstract everything's one system, but it's a lot of interconnected local systems. And that's what we're building in both the technology, legal, and regulatory front so that our system can be seamless.

Okay. And we've had a few questions on contract adoption and volumes. I'm going to group them into one question. And I know we've hit a number of these aspects already, but maybe this is a good opportunity to summarize in one place for everyone. And I think a representative question is that there's, you know, the management has emphasized strong interest in trading ABEX products and People are waiting to see that strong interest translate into volumes and just trying to understand and connect the dots between that interest and the path to volumes on the exchange. when that would potentially be realized and how we get from there one point to the other. So I don't know, Josh or Joe, if you would want to just kind of walk people through that process one more time, maybe some clarity on the trading interest and how that, you know, how you see that translating into volumes over time.

Maybe I'll take it first and then hand over to Joe. But again, I think that's why I laid out in the earlier statements, you know, even though we think the long-term ROI on something like LNG, as I mentioned on our Hedgeye interview yesterday, you know, we actually believe Like last week, an important thing happened where I think the OPEC decision and a number of the things that are happening in global trade really did show that global gas is becoming the global energy commodity in a way that oil has dominated as the key global energy commodity for the last decade. 100 years plus. So global gas, I think we were literally at that tipping point this quarter. And so that's why, and we predicted that many years ago, and that's why we built that as our flagship product. And so, yeah, so, you know, that's still our long-term objective. But as I said, and I think we'll be more clear as we show some of this network node model maybe on the next call, you know, to bring that liquidity, you're really starting, you know, at a global basis from day one, which needs all of this legal, regulatory, and technology infrastructure and onboarding and so forth. So what we've done now as we continue to build that long-term ROI in things like global gas, what we've done now is we're actually, you know, really focused now that we have this core infrastructure in place on faster developed products. You know, again, things like indexes, spreads, and what I call step-out markets, which can actually develop liquidity on probably a smaller network of nodes, like, you know, just, you know, obviously – Even from a regulatory perspective, our clearing members are Singapore entities. We've got a very developed Singapore ecosystem there already. And so launching something like a Singapore-specific gold futures product potentially can grow volumes quicker on a smaller number of nodes than trying to tackle the whole global LNG industry from start, right? So I think that's sort of the two-pronged approach. We're not forgetting about the ROI and the core mission here of the global network, but we are now focusing on products that can add more nodes and develop smaller network liquidity. So that's probably what I would say, and that's what we're – I think we'll have obviously many good updates on that front over the next quarter.

Joey, anything you want to add to, again, the- in markets that are being made on the screen pretty much all day long in LNG and all three LNG contracts. It's the first time that that's ever been done ever in the history of LNG, where you have three global benchmarks that have bids and offers all day long that market participants can execute on. And we've seen now the announcement that we made two weeks ago where we had an OTC trade that was based on our, our, One of our price references, that's really the start of something. When you see how Brent started back in the day, Brent started with a very small handful of cargoes a month coming out of the North Sea and started the price reference. Now you're looking at our LNG contracts now starting to be price referenced. It's a huge, important step in the marketplace. Again, would we wish it would happen faster? Absolutely. But the important thing is that the green shoots are there for us and the distribution of our pricing. As you mentioned, Josh, we have a partnership with an incredibly large distribution network that will get our prices out to the marketplace in areas that – Nobody's seeing them now. And that's going to happen within a very, very short period of time. And that will only open up more eyeballs to our products, more interest to trade it, more onboarding. So, again, the flywheel starts with the distribution of our products, the use of our indexes, and, again, bringing products to market that the companies are asking us to launch. So that's an important part of the whole kind of ecosystem that we've built.

Yeah, I would also probably point out that we've talked about things like the onshore-offshore lookalike partnerships in China. That's obviously going to be increasingly relevant in today's world, unfortunately. more, you know, more regional sort of trade walls and capital walls. And so and being in a place like Singapore, that's exactly why we're there is, you know, we believe that, you know, this is still a place to manage that liquidity and global supply chain. So, you know, that's one area. Again, the focus that we've had on data and distribution, that's one area. The potential for third-party clearing, that's another area. So none of these are new strategies. It's important to point out. Maybe we didn't emphasize others before today. And now we're in more of a dynamic situation where you look at the network as a whole, you look at the long-term objectives, and you start tackling the priorities that add the most nodes to the network. Again, whether it's a product that can trade faster and ramp up faster and doesn't need so much of the network. And so we're always reading and reacting to how to bootstrap A market that, like I said, there's probably like even where we've been to date, there's probably six or seven chicken and egg sort of like, you know, what do you focus on first problems that we've already gotten through? We've got more ahead. But again, as Joe said, well, you know, we know the ways through it. And and we know, you know, we know the timelines that we need to be focused on this year, you know, to get through the next wave.

Thanks, Josh and Joe. Yeah, I know we're coming up on the hour. I'd like to try to get in a few questions on the technology side, so I'd like to pivot there. We've had a number of questions that get to the point of, can you provide an update on ID++ and the broader ABEX technology suite, really with giving investors an understanding of how you see that being applied. And given your earlier comments today, how you see that, you know, coordinating and adding value to what's happening at the exchange and clearinghouse.

Yeah, look, I think one of the major global energy companies, I saw a quote on our internal go-to-market Slack channel, how they were saying you allow the collateralization of a physical commodity You know, digitally, it changes the entire nature of futures market collateral and efficiency. So, again, that's why Abix was built. I mean, that was a number of patents I've been writing for over 10 years is how we use these new distributed and decentralized computing systems to do that. I think I've spent a lot of time on previous calls saying that I do not believe that blockchain tokenization is the right path for that. You know, if you can super like, you know, simplify and commodify, you know, a product like, you know, an equity security, a a money market fund, you know, maybe a US dollar stable coin, these types of things. Sure. You know that that can move as a token on a block chain. But a very complex, you know, financial instrument, you know, you're really about talking about how do you really secure a digital title and the, you know, rights and responsibilities of those people executing a digital title. That's why we've put so much work into the identity side of our development and also the digital contract and digital signature, you know, the credential verification aspects of the technology. And, you know, as recently as last week, you know, we talked about how, you know, people like, you know, the CEO of BlackRock said, are talking about solving identity and essentially credential management is the key path to unlocking this whole blockchain collateral ecosystem. So I think we've been focused exactly in the right place, and I think we've done it in a way nobody else has. at this stage. And so, yeah, we're incredibly excited about that. And as far as, you know, specifically for doing things on the exchange, the collateral and currency movements globally that others can't do. That's exactly where we're focused on this technology. And, you know, although, you know, like I said, it's a long call, and we've obviously been, you know, very much focused on the network building and onboarding updates, the revenue and product updates. But, you know, I would say in the next couple quarters and the next, you know, next calls, like, look, we're going to be releasing our pilot roadmaps. We're going to get into more details and white papers. That's all in process. And, yeah, I think probably as the last few calls, this is all coming together for people. It's increasingly, I believe, going to come together over the next quarter.

Thanks, Josh. And I'd love to squeeze in one more question. I know we're coming up at the hour, but just to get one more on the technology side. And that question is, you mentioned how the roadmaps are going to be coming on future calls. Just a question of how do you see artificial intelligence, AI, playing into the technology strategy?

Yeah, look, it's as, you know, the understatement, it's an absolutely, you know, change in the way everybody globally is going to be doing work. And so we need to be thinking about that on a one year horizon, two year horizon, five year horizon. And what I've emphasized in previous calls is by being a full-stack company that puts technology in the front office, you know, from, you know, really from the CEO down, you know, we're thinking about technology and innovation in every step. We're not waiting for third-party integrators, you know, to come explain how this is going to work. We're living it. We're building it. We're testing it. You know, we've got a labs approach to using it every day. We already have our own internal AI infrastructure, which is probably not normal for a startup exchange of this size, of our capitalization. And I think the places it's going to be incredibly important for our ecosystem is, again, collapsing the pre-trade and post-trade. The pre-trade is all about your network of, you know, all these people we've talked about before, the commercial firms, the market makers, the brokers, you know, all of the network that creates liquidity, creates price discovery on the pre-trade and all the processes of, you know, submitting orders, you know, analyzing data to submit orders. AI is going to be part of every piece of that. And then, of course, on the post-trade, how do you speed up settlement and clearing from multi-days to basically real-time? That's all going to need reconciliation automation, verification of digital signatures, verification of custody, verification of legals. All of that is going to be accelerated with artificial intelligence. But the question is, how do you maintain the privacy throughout the network to allow that speed and efficiency to come through, collapse the pre-trade and post-trade, but do it privately that only the AI agents can see on a need-to-know basis? You know, the same thing that's already happening in the human blockchain, the human network of intelligence of the financial system. We're going to have to replicate all of that privately and securely in a digital ecosystem, but speed it up with artificial intelligence. So, you know, I think if you even go back to our initial listing statement, you know, filed on CDAR, we mentioned how self-sovereign identity matters. you know, distributed and decentralized computing technology, content addressable storage, and very specifically, you know, we've been following for many years the development in natural language processing and machine learning. Obviously, that's all been taken to another, you know, another scale with, you know, what's now known as AI and, you know, and the inference technologies. But this has always been built into our roadmap. And, you know, we keep technology in the front office. And we think the AI piece of this is a game changer for our industry as it is for everybody else's. And we, you know, we have a very high expectation for ourselves that we will be at the forefront of implementing this as, you know, the global exchange group with the latest technology stack. And, you know, I would hope, you know, some of the most advanced thinking in this field.

Thanks, Josh. So that's really all the time we have for questions today. We really tried to get to the heart of all the questions being asked, if not the specific questions themselves. Thank you for sending those in. If you feel that your question was not addressed, please reach out to us at ir.abex.tech to our investor relations email address, and we'll address those questions with you specifically. And with that, I'll turn it back to Josh for any closing comments you might have.

No, thanks, everybody, and thanks for staying a little longer today. Again, you know, the transition this year to the operating and revenue side of all of these developments has been, you know, it's just incredibly exciting. And I know there's certain milestones that people always want to see faster, but it is happening this year. The team is absolutely focused. We've got some fantastic new shareholders and investors on board for our mission. And, yeah, I couldn't be more excited about the next couple quarters ahead. So thanks, everybody.