Mark Binns on Facilitating the Next Stage of Crypto Adoption | #HashtagFinance

CSE’s James Black chats with Mark Binns, CEO of BIGG Digital Assets Inc. (CSE:BIGG) to discuss the company’s commitment to delivering “compliance-first crypto” through their Netcoins and Blockchain Intelligence Group businesses. Mark also shares his thoughts on the current state (and price) of bitcoin and how his company is preparing for the influx of institutions moving into crypto currencies.

Here’s an overview of what James and Mark cover in this edition of the #HashtagFinance podcast:

0:00 – Introducing Mark Binns and BIGG Digital Assets (CSE:BIGG)
0:50 – The institutional influence on crypto and bitcoin
2:14 – What is Netcoins? …and the future of crypto exchanges
5:40 – The pros and cons of bitcoin ETFs
7:55 – The business reasons for purchasing bitcoin
9:30 – Does short selling occur on crypto exchanges?
11:05 – The origin of Netcoins and the world’s first bitcoin ATM
13:05 – What is influencing the price of bitcoin right now?
17:35 – Delivering compliance-first crypto with BitRank and QLUE
21:05 – $12M raised and use-of-proceeds
22:35 – What’s next for BIGG?
23:30 – The wrap

About BIGG Digital Assets
BIGG Digital Assets Inc. (BIGG) believes the future of crypto is a safe, compliant, and regulated environment. BIGG invests in products and companies to support this vision. BIGG owns two operating companies: Blockchain Intelligence Group (blockchaingroup.io) and Netcoins (gonetcoins.com).

Blockchain Intelligence Group (BIG) has developed a Blockchain-agnostic search and analytics engine, QLUE (TM), enabling Law Enforcement, RegTech, Regulators and Government Agencies to visually track, trace and monitor cryptocurrency transactions at a forensic level. Our commercial product, BitRank Verified®, offers a “risk score” for cryptocurrencies, enabling RegTech, banks, ATMs, exchanges, and retailers to meet traditional regulatory/compliance requirements.

Netcoins develops brokerage and exchange software to make the purchase and sale of cryptocurrency easily accessible to the mass consumer and investor with a focus on compliance and safety. Netcoins utilizes BitRank Verified® software at the heart of its platform and enables crypto transactions via retail locations globally, a self-serve crypto brokerage portal.

Learn more about BIGG Digital Assets at https://thecse.com/en/listings/technology/bigg-digital-assets-inc

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Verano Holdings Corp. Joins the CSE for a Virtual Market Open

The CSE gave a warm welcome to Verano Holdings Corp. (CSE:VRNO) with a virtual Market Open on February 17th, 2021. 

Verano Holdings Corp. is a leading multi-state cannabis operator covering 14 US states and an expanding lineup of consumer brands. Their cultivation facilities cover an impressive 750,000 square feet in three states, giving Verano a competitive edge in the cannabis industry. With a mission to address vital health and wellness needs, Verano produces a comprehensive suite of premium innovative cannabis products, and the CSE is excited for the future of this growing and evolving cannabis operator. 

To open the day’s trading session, Verano Holdings Corp. CEO and Founder George Archos and his wonderful team joined the CSE for a celebratory virtual Market Open. 

For more details about the CSE, including information on other Market Opens, please visit the CSE website or follow us on social media.

Andrew Thut on Building Large Scale Cultivation for Long Term Growth | #HashtagFinance

CSE’s Barrington Miller chats with Andrew Thut, Chief Investment Officer of 4Front Ventures Corp. (CSE:FFNT) to discuss the company’s commitment to scalable cultivation and out performing black market prices by double digits. Andrew also reflects on how the industry has evolved since his entry into the sector in the mid 2010s.

Here’s an overview of what Barrington and Andrew cover in this edition of the #HashtagFinance podcast:

0:00 – Introducing Andrew THUT and 4Front Ventures
1:30 – The advantage of being an MSO in the US
4:00 – Lessons learned from the early days of cannabis
6:20 – How Andrew’s “safe” banking career transitioned to cannabis
11:20 – What 4Front figured out about low-cost production
14:30 – The impact of inter-state commerce in the cannabis industry
20:40 – Illinois v Massachusetts
23:50 – The catalysts for 4Front in 2021
25:50 – “Know what you own”
28:00 – The Golden Age of Cannabis?

About 4Front Ventures Corp.
4Front (CSE: FFNT) (OTCQX: FFNTF) is a national multi-state cannabis operator and retailer, with a market advantage in mass-produced, low-cost quality branded cannabis products. 4Front manufactures and distributes a portfolio of over 25 cannabis brands including Marmas, Crystal Clear, Funky Monkey, Pebbles, and the Pure Ratios wellness collection, distributed through retail outlets and their chain of strategically positioned Mission branded dispensaries.

Headquartered in Phoenix, Arizona, 4Front has operations in Illinois, Massachusetts, California, Michigan, and Washington state. From plant genetics to the cannabis retail experience, 4Front’s team applies expertise across the entire cannabis value chain. For more information, visit 4Front’s website www.4frontventures.com.

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Chris Bunka on the New Science of Dosing and Drug Delivery | #HashtagFinance

CSE’s Anil Mall chats with Chris Bunka, Chairman and CEO of Lexaria Bioscience Corp. (CSE:LXX) to discuss the company’s recently closed financing of US$11 million and the opportunities that capital has afforded the company’s ability to further prove out the effectiveness of its patented DehydraTECH™, drug delivery technology across multiple classes of bioactive substances or drugs.

Here’s an overview of what Anil and Chris cover in this edition of the #HashtagFinance podcast:

0:00 – Introducing Chris Bunka and Lexaria Bioscience
2:25 – Recent listing on NASDAQ and financing
4:40 – The team at Lexaria
7:30 – Chris’ background and what drives him
11:58 – DehydraTECH™ – drug enhancement delivery system
16:11 – Competing with Nanotechnology
18:50 – Utilizing patents with CBD
26:00 – Developing smoking alternatives w/ oral nicotine
33:00 – CBD from hemp
36:00 – Improved anti-viral drug delivery
40:15 – working with universities
44:20 – The best team he has ever worked with

About Lexaria Bioscience Corp.
Lexaria Bioscience Corp.’s proprietary drug delivery technology, DehydraTECH™, improves the way active pharmaceutical ingredients (APIs) enter the bloodstream by promoting healthier oral ingestion methods and increasing the effectiveness of fat-soluble active molecules, thereby lowering overall dosing. The Company’s technology can be applied to many different ingestible product formats, including foods, beverages, oral suspensions, tablets, and capsules.

DehydraTECH has repeatedly demonstrated since 2016 with cannabinoids and nicotine the ability to increase bio-absorption by up to 5-10x, reduce time of onset from 1 – 2 hours to minutes, and mask unwanted tastes; and is planned to be further evaluated for orally administered bioactive molecules, including anti-virals, cannabinoids, vitamins, non-steroidal anti-inflammatory drugs (NSAIDs), and nicotine. Lexaria has licensed DehydraTECH to multiple companies including a world-leading tobacco producer for the development of smokeless, oralbased nicotine products and for use in industries that produce cannabinoid beverages, edibles, and oral products. Lexaria operates a licensed in-house research laboratory and holds a robust intellectual property portfolio with 18 patents granted and approximately 60 patents pending worldwide.

For more information, please visit www.lexariabioscience.com.

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Red Light Holland: Proving the potential of recreational psilocybin begins with choosing the right market

One of the more interesting small-cap market developments of 2020 is increasing investor comfort with the psychedelics industry.

The year has seen multiple psychedelics companies IPO on exchanges in Canada and the US, and M&A activity is ramping up, too. Momentum in the sector is being driven by legislation in Canada opening the door for end-of-life patients to use psychedelics as a therapeutic option, while in the US, the Food and Drug Administration designated psilocybin as a “breakthrough treatment” for mental health disorders. The industry clearly has plenty of runway heading into next year.

Most of the publicly listed companies in the segment focus on therapeutic applications, working on research and development of psychedelic-based treatments for mood and anxiety disorders.

Canada’s Red Light Holland (CSE:TRIP), however, has found its niche in the recreational part of the market by selling small doses of psilocybin to adult consumers seeking to experience the psychedelic effect without a prescription. In the process, it has set itself on a clear path to revenue, which is an immediate point of differentiation compared to most peers.

The Toronto-based firm is the first publicly traded company that has a legal psilocybin product on store shelves and online (in the Netherlands). Its iMicrodose pack is a collection of “magic truffles” – a type of fungi that contains a lower concentration of psilocybin than their mushroom brethren but still enough to produce a psychedelic experience.

While making very clear that medical claims cannot be made at this point and highlighting that substantial research is still being done to prove certain beliefs, Chief Executive Officer Todd Shapiro tells Public Entrepreneur that he thinks psilocybin has the potential to “change the world” for people suffering from depression and mental health disorders. “For me, the opportunity was never about a trend,” Shapiro explains during a recent interview. “It’s about making a difference with a long-term plan. And it’s about empathy, compassion and providing access.”

Shapiro, a former Toronto media personality, began to explore the world of psilocybin through conversations with guests on his SiriusXM radio program. Sensing opportunity, he assembled a team of investors and advisors containing some truly boldface names: Bruce Linton, Terry Booth, Brad Lamb and even comedian Russell Peters, who serves as the brand’s chief creative officer.

The group decided to explore the opportunity to sell psilocybin as a recreational product in a legal market and settled on selling truffles in the Netherlands. It raised nearly $4 million before going public on the CSE in May 2020.

At this point, it’s fair to ask – aren’t magic mushrooms illegal? The answer lies in the composition of the fungi. In the Netherlands, where iMicrodose recently debuted in smartshops across the country, magic mushrooms themselves are illegal, but truffles – a network of interconnected filaments that branch out from the mushroom below ground – are legal to buy and consume.

The pursuit of the recreational market as opposed to medicinal psilocybin is a huge part of what differentiates Red Light Holland. “We would love to be a part of helping to prove how psilocybin can help human beings, be it supporting studies or trials,” Shapiro says. “I think that the medical side is extraordinarily important, but why are we limiting the potential of responsible adult use? When we do that, we are limiting a lot of adults who have access to information, education and early trial data as well as anecdotal research. I don’t think we should do that for people who want to try this responsibly.”

Echoes of the cannabis sector’s growth trajectory ring through Red Light Holland’s story. Early acceptance of medicinal marijuana paved the way for the recreational market and, eventually, legalization. Shapiro is hoping that Red Light Holland can blaze a path to tolerance of recreational psilocybin. “Magic mushrooms have been used for generations for a wide variety of purposes,” Shapiro notes. “Red Light Holland wants to offer it to people who want it in legal jurisdictions, much like we saw in the cannabis market.”

That’s not to say that the company isn’t exploring possible therapeutic applications as well. Its scientific division, Scarlette Lillie Science and Innovation, recently secured a relationship with US-based Jinfiniti Precision Medicine to explore potential roles that psilocybin and truffles can play for age-related and psychiatric disorders.

Red Light Holland may not take the lead on clinical trials, but it wants to carefully look into how it can support the science by perhaps teaming up with people who could potentially get involved in trials in some capacity. “If we can learn more about the truffle itself, that would be our goal,” Shapiro says. “Maybe there’s a CBD-like element to the truffle that we don’t know about yet.” 

The therapeutic psilocybin market is poised to reach a value of nearly US$6.7 billion by 2027, according to Data Bridge Market Research, making it an attractive proposition for investors. While the recreational market is obviously much smaller in value, Shapiro hopes to find a new consumer – a young professional, a firefighter or a modern couple who just put their kids to bed.

“I want iMicrodose packs powered by Red Light Holland to be consumed by the Ketel One drinker, someone who loves a glass of wine, essentially an adult who wouldn’t necessarily walk into a smartshop but would rather order legally from an easy-to-use e-commerce store. I want to help expand the market,” says Shapiro.

There are signs that other countries will soon follow the Dutch lead of legalizing truffles, or at least relax the relevant laws. In Brazil there are no laws against the sale, distribution or use of magic mushrooms. Jamaica has long been a destination of choice for psychedelic retreats, and Bulgaria is on the radar. For now, though, Shapiro appears to have Red Light Holland firmly focused on its namesake country.

“A lot of the issues at cannabis companies came about because they thought there was a bigger market than there actually was, and then they wound up expanding too quickly,” Shapiro says. “We like the idea of learning who our customers are and expanding from there with education, information and responsible use initiatives.”

iMicrodose debuted in Amsterdam in September, retailing for €25 per pack. Distribution quickly spread to Rotterdam, Eindhoven and Den Bosch, as well as online. Shapiro and his team hope to have iMicrodose in as many smartshops as possible over the next year while growing brand recognition.

Red Light Holland is blazing a trail in the psychedelics sector as the first psychedelics company with a legally available product to list on a major exchange, and it fills Shapiro with pride.

“It helps legitimize what so many pioneers and advocates have pushed for, because we’ve gone through the regulatory bodies,” he says. “It’s not something that we’re doing underground. If you’re in the Netherlands, you can order iMicrodose packs online right now. Let’s end the stigma together.”

This story was featured in the Public Entrepreneur magazine.

Learn more about Red Light Holland
at https://redlighttruffles.com/

Darius Eghdami on Developing the Tech Behind Regulated Gaming | #HashtagFinance

CSE’s Anil Mall chats with Darius Eghdami, President of FansUnite Entertainment Inc. (CSE:FANS) to discuss the company’s recent oversubscribed financing and plans for continued global growth supporting the regulated gaming industry with technological innovation.

Here’s an overview of what Anil and Darius cover in this edition of the #HashtagFinance podcast:

0:00 – Introducing FansUnite (CSE:FANS)
3:02 – Their recent financing and focus on growth
5:15 – The synergies between FansUnite and Askott Entertainment
7:25 – Competing with the giants in the US
9:00 – Plans for 2021 and the three pillars of the business
11:15 – Darius’ favourite game he is working on
12:35 – Bill C-13’s impact on betting in Canada
16:05 – Trends in the gambling sector
18:30 – A message from Darius

About FansUnite Entertainment Inc.
FansUnite is a Sports and Entertainment company, focusing on technology related to regulated and lawful online sports betting and other related products. Our mission is to be the iGaming industry leader by providing our partners and players the industry’s most versatile and vertically integrated platforms with a portfolio of unique products and a focus on esports, sports betting, casino and the next generation of bettors.

Learn more about FansUnite: https://thecse.com/en/listings/technology/fansunite-entertainment-inc 

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Jushi Holdings: Timing is everything, and this expert cannabis team knows just when to pounce

Jim Cacioppo and his team at Jushi Holdings (CSE:JUSH) definitely know the meaning of patience, as they exercised plenty of it before setting up a new company to enter the legal cannabis industry. They watched as executives of all shapes and sizes rushed in during the early days of regulatory change, some quickly enjoying success, and others ending up on the ropes after making an endless trail of mistakes. The future Jushi management circle gathered know-how and bided their time.

That discipline is paying off hugely now.

Jushi is a multistate cannabis and hemp operator, and while the company may only have been founded in 2018, it is already gaining solid traction in its target markets and is exceedingly well positioned for long-term growth.

Cannabis is a complex industry in which most companies contend with a wide variety of regulatory environments. That’s especially true in the United States, given the patchwork of state-by-state regulations across the country. 

But to the Jushi team, the size of the pie available for successful operators to share in the United States makes the regulatory navigation worth it. “Everything else pales in comparison to the size of the US,” says Cacioppo, Jushi’s ambitious Chief Executive Officer, who is convinced the company’s strategy will make it one of the top global cannabis players within just a few years.

Cacioppo was a successful early investor in the cannabis space and became an expert in identifying distressed assets through his work in private equity. He saw what he calls a “gaping” opportunity to create a great company that had the right mix of management, financial resources and skills.

Cacioppo teamed up with fellow financial and cannabis industry hands Erich Mauff, Jon Barack and Denis Arsenault to prove his point. The combination of their personal networks, business experience and some early cash from their own pockets got Jushi off to a good start. It is now a vertically integrated cannabis juggernaut, operating in several US states, with cultivation, processing and retail assets under its corporate umbrella.

“Most people who win licences don’t have money, don’t have sophistication, don’t have the resources or the skills to operate these kinds of ventures,” explains Cacioppo, who says the sector is still littered with distressed players, even after the cull of recent years. “They just won licences, so they’re undercapitalized from day one.

“You could see the trends in our favour: the scale, the lack of good management teams and the opportunity to purchase companies rather inexpensively,” continues Cacioppo about the industry’s early days.

Jushi cleverly set about buying assets and licences where there were barriers to entry. It targeted growing, populated areas, with limited-licence medical markets and/or where legalized adult use had yet to arrive.

The team added to its depth in June 2019 with the acquisition of The Clinic, a Colorado business that brought new and proprietary information on cannabis cultivation, extraction and brand development. 

The group now has over 70 product formulations under its Lab brand, as well as a new line of hemp-based CBD products called Nira. Its 11 cannabis dispensaries all feature Jushi’s BEYOND / HELLO brand above the door.

Jushi has three core markets: Virginia, with a limited medical licence; Pennsylvania, Jushi’s largest market and home to a well-established medical cannabis environment; plus Illinois and its strong adult-use market. Illinois and Pennsylvania are expected to account for 77% of group revenue in 2021.

In three other markets, Jushi has established operations and is looking to scale up. These are Ohio (developing a medical program), Nevada (large adult-use market) and California. The last of these, of course, is the biggest cannabis market in the US and also home to a long list of very distressed assets.

In Illinois, Jushi aims to double the number of retail outlets it operates to four by early Q1 2021. Experts say the state’s adult-use market is growing rapidly and could reach US$3 billion in value.

In Pennsylvania, which could account for up to US$110 million in revenue in 2021, the aim is to grow its dispensary count to 15, from eight at present, with the already increased capacity at its 90,000-square-foot facility for cultivation and processing.

Virginia, where Jushi is one of only two public companies licensed to operate, will be the jurisdiction of highest growth in percentage terms, as Jushi currently does not have any stores there but is planning to build six.

“We have three great states that give us growth in-house for several years, so we don’t need to do any acquisitions, and we have the capital to build up the businesses,” says Cacioppo. The company closed a $30 million financing in the latter part of October, adding to a cash balance that was already around the $50 million mark.

COVID-19 has brought challenges, of course, including the adoption of strict social distancing rules.

On the other hand, the cannabis sector was declared an essential service, and Cacioppo believes there have been other positives, such as increasing demand, an influx of new consumers, and a newfound respect and validation for the cannabis industry.

A quick look at Jushi’s financials shows how well things are working.

Preliminary third-quarter results announced in early October contained expectations for revenue of $24 million, which would be 61% above the prior quarter, while fourth-quarter revenue is anticipated at the high end of the previously announced range of $25 million to $30 million. Jushi also expects to report positive adjusted EBITDA in the fourth quarter.

Forecast revenue for 2021 has been revised upward to between $205 million and $255 million, from $200 million to $250 million, while adjusted EBITDA is expected to be between $40 million and $50 million.

Beacon Securities recently initiated coverage of Jushi with a buy rating, describing the company as a “hidden gem.” 

Its analysts noted that both New Jersey and Arizona were set to vote on adult-use legalization measures, with the New Jersey vote in particular holding the potential to have a domino effect on other markets, including New York, Pennsylvania and Connecticut.

“Illinois has seen legal-market cannabis sales quadruple to a $1.2 billion annualized run rate after its adult-use market opened in January. Pennsylvania may be one of the ‘dominos’ that falls if neighboring New Jersey approves adult-use legalization next month,” notes Beacon.

With Jushi shares having traded as high as 300% above their March 2020 lows, the patient work of Cacioppo and his Jushi teammates is clearly being recognized. And with more positive regulatory change on the horizon in the United States, Jushi seems to be in that sweet spot with the right strategy at the right time.

This story was featured in the Public Entrepreneur magazine.

Learn more about Jushi Holdings Inc.
at https://jushico.com/

Year-End 2020 Interview With Richard Carleton

Earlier this month, CSE CEO Richard Carleton sat down with Peter Murray of Kiyoi Communications to recap an eventful 2020 and discuss the coming year for the exchange.

Scroll down to read the full transcript of Part 1 of this interview. For ease of navigation, a list of hyperlinked topics is included below.

1. Leading through COVID-19

2. The role of Initial Public Offerings (IPOs)

3. What was funded in 2020

4. CSE’s contribution to the mining industry

Leading through COVID-19

PM: We spoke in the summer about leadership in the COVID-19 environment. Do you have any new observations to share from the past six months?

RC: The themes are basically the same as we talked about over the course of the summer in that we have done an excellent job – and not just at the Canadian Securities Exchange but the securities industry in general – to provide a high level of service while dealing with the staff dislocation caused by the lockdown orders, bans on non-essential travel, and so on.  That has certainly continued through the fall and now the winter.  We have a small team onsite in Toronto, primarily on the technology and market operations side.

We have transitioned most of our business development and education capabilities – all of them really – to virtual events.  And we concluded in late 2020 the Mining Over Canada project where we created more than 60 hours of content over the course of five or six weeks, which is available on our YouTube channel and various other social media platforms.  That was a wonderful collaboration with thought leaders and issuers from the mining industry.  It was a tremendous amount of work and kudos to Anna Serin and her team for putting the program together.  I think people in the mining industry really took note of our encouragement and support for the sector and we look forward to building on those relationships in 2021.  The landscape continues to be very favourable for mining and it’s a sector of the market we have high hopes for this year.

The role of Initial Public Offerings (IPOs)

PM: IPOs have gone from being very infrequent just four years ago to a listing approach of choice today.  Talk to us about how companies are coming to market and what the CSE feels the most efficient approaches are.  Also, are there any misconceptions that need to be set straight?

RC: The IPO was almost dead three or four years ago, and as you mentioned we now see the IPO as an increasingly common route to market.  I think there are a few drivers behind that, but every situation is unique, and for me to say the IPO is superior to the RTO in all circumstances would not be accurate.  Each company has to figure out in the context of their financing what the lowest cost of capital is, what approach will provide the best post-listing liquidity profile – there are a lot of considerations that go into it.

But historically, the concern has been that the IPO takes longer, costs more and introduces significantly more risk into the transaction because of the time it takes from the decision to launch the IPO to actually getting there.  There is also the side benefit that if you do an RTO and are able to get the growth capital required through a private placement supported by a relatively small number of investors, the management team is not having to lose focus on the day-to-day business of the company as they might spending time on the road selling the securities being qualified by the prospectus.  That is a significant consideration for some companies when they decide to do an RTO.

I think it is becoming better understood that there are a number of dealers who are in a position to handle IPOs and they have a lot of investors in place ready to support certain types of companies.  As a result, their sales effort may not be as challenging as it has been in previous market cycles.  And I think post-listing price performance and liquidity can be better with an IPO because you have investors who considered the company and have made the decision to invest in it.  With an RTO, the target can be in a completely different industry.  We  saw a lot of companies that had been mining companies and turned into cannabis companies overnight.  The original shareholders bought into a mining company, not a cannabis company; that can create an overhang that impedes price out of the gate.

So, there are many different considerations.  I think it is healthy that we are seeing more IPOs because that gives people broader access to investment opportunities.  You don’t have to be an accredited investor to invest in securities that are being qualified by a prospectus, and the more people who are able to participate in the growth of these companies, the better off and the healthier the public capital markets will become.

What Was Funded in 2020

PM: The stock market in general was robust through much of 2020.  CSE data shows financings and trading volume in particular at strong levels for yet another year.  Walk us through some of the numbers, and also discuss some of the internal achievements that people might not necessarily be aware of.

RC: The principal takeaway from the numbers is that financing activity was extremely healthy for the year beginning around late April.  That continued through the course of the summer.  There is often a drop-off in July and August, but in 2020 there was no such effect.

As I mentioned a moment ago, from a dollar perspective the cannabis industry was the largest fundraiser on the exchange.  However, in terms of the number of individual financings, the mining industry was by far the leader.  It’s not surprising, given concerns about incipient inflation brought about by the enormous monetary creation by central banks in developed economies.  As a result, we have seen a tremendous amount of investment activity in the precious metals space.  There is also the expectation that coming out of the pandemic, governments will invest significant amounts in infrastructure, and that means commodities such as iron, copper and other components of steel are going to be in high demand.  We are already seeing spot prices of these commodities increase quite nicely.

There are also concerns about supply chains, where people would prefer to source materials from jurisdictions that are more politically stable than others.  So, people looking to rationalize supply chains and shorten their delivery cycles are encouraging a lot of activity in the North American mining space in particular.

PM: Let’s look a little more at this continuation of strong financing activity on the exchange.  Aside from mining and cannabis, was their notable investor interest in any particular sectors?

RC: For obvious reasons healthcare technologies, and telehealth in particular, are industry categories in which companies performed very well over the course of the year.  It’s not something we would have predicted to that extent going into the year, but when the pandemic began to really take off it was a timely area for these companies to be in.

As far as psychedelics go, we have around 30 companies pursuing different business opportunities in the space.  We first began to hear rumblings in 2019 that people were going to be looking to advance the cause for psychedelics, particularly as a treatment for substance abuse, anxiety and depression.  I’ve had the opportunity in my position to learn from the industry’s thought leaders and the takeaways are fascinating.

There is a meaningful body of clinical research dating from the 1920s through the 1950s for substances such as LSD, psylocibin and ketamine.  The clinical indications were incredibly positive for some of these therapies on depressive illness that had resisted other kinds of treatment.  It was really the war on drugs that pushed these substances into the background and ended research into the space for the last 70 years.  We are now in a position where researchers will be able to continue that work.  I’m confident that we will see supervised therapies involving these compounds achieve important breakthroughs on multiple illnesses that have been very challenging for traditional pharmaceutical companies to appropriately address.

PM: The growth in aggregate market capitalization on the CSE in 2020 was exceptional, and as of early 2021 it has surpassed $50 billion.  Walk us through the reasons for the increase and your thoughts on growth in the years ahead.

RC: For us, the significant increases in market capitalization are almost entirely due to the US multistate operators in the cannabis sector.  The top ten operators in the United States are listed on the CSE and they contribute a significant percentage of that $50 billion.  Curaleaf, which is our largest company by market capitalization, as well as by revenue and some other measures, passed $10 billion in market capitalization just the other day.  It’s fascinating to see the growth in these companies.

It’s going to be interesting with the political changes in the United States, with the Democrats now controlling the Senate.  A lot of these companies have been on a tremendous run on the belief that the Biden administration will oversee liberalization and potentially the de-scheduling of cannabis from the Controlled Substances Act.  My take is a little less bullish. I think there will be liberalization of banking and potentially tax measures associated with the industry, but I don’t believe that either Mr. Biden or Ms. Harris have full support from their party to make new cannabis laws a central piece of their legislative program.  I think a number of longstanding issues will be addressed, but I’m not sure we are going to see full-on de-scheduling of cannabis in the United States, certainly during the first two years of the administration.

In the meantime, progress continues at the state level, with New Jersey having voted to legalize, and New York and Connecticut appear on track to legalize cannabis for adult use in the coming year.   We’ll probably see recreational legalized in Pennsylvania at some point in the next year or two.  These are really big populous states, and the companies that have real scale will have the opportunity to expand their businesses as a result of work at the state level.  These companies will likely continue to grow at significant rates.

CSE’s contribution to the mining industry

PM: I want to go back to Mining Over Canada, as there was so much to learn from the series, and it will have significant educational value for investors for years to come. Talk to us more about how it developed internally and some of the insights that came out of it.

RC: Mining Over Canada was really the culmination of other virtual events we had done earlier in the year.  One of the things that struck us early on was that everyone is working from home, so these highly respected investors and company leaders, they are available – we can call them up and get 15 or 20 minutes for a video segment with them.  I think back to an interview that our James Black did with Howie Mandel early in the pandemic in support of Howie’s charity, which helps provide personal protective equipment to healthcare professionals in North America.  James was thanking Howie for his time and he said, “Hey, I’ll give you as much time as you want.  I’m just here, you know.”

We had a similar experience with Mining Over Canada.  We approached a number of thought leaders – whether it be analysts, investors, or leadership at our issuers – and they were extremely cooperative and generous with their time and guidance.

One of the things we really wanted to help emphasize is just how important the mining industry is to the Canadian economy, not only in historic terms but in the present day as well.  And how Canada can leverage its leadership in public finance for the industry to service the wave of demand coming from the industry.  Whether it’s significant increases in infrastructure, desire to shorten supply chains, new demand for minerals brought on by the electrification of the economy – mining is going to be at the forefront of a lot of thinking and investment in coming years.

Check out Part 2 of the interview here.

Year-End 2020 Interview With Richard Carleton Part 2

Earlier this month, CSE CEO Richard Carleton sat down with Peter Murray of Kiyoi Communications to recap an eventful 2020 and discuss the coming year for the exchange.

Scroll down to read the full transcript of Part 2 this interview. For ease of navigation, a list of hyperlinked topics is included below.

1. Changes at the board level for the organization

2. Outlook for 2021

Changes at the board level for the organization

PM: Thomas Caldwell stepped down as Chairman of the CSE’s Board of Directors in September after spending almost eight years in the role. Talk about his contribution to the Exchange as an investor and also as Chairman. How will he continue to support the Exchange’s efforts going forward?

RC: I think it’s fair to say that the Canadian Securities Exchange would not exist in its present form without Tom’s leap of faith back in late 2012 to lead an investment round that provided the exchange with the capital required to continue to offer its services.  In his capacity as chairman, Tom was a relentless advocate for the CSE in his work and with his contacts, which of course are incredibly broad in the exchange world.  He is tremendously supportive of our management team and very inspirational with his “relentless optimism” as he calls it.  His energy, his commitment and his passion for the business were an inspiration not just to me, but to the entire organization.

Tom is not far away, because he is the chairman and principal of Urbana Corporation, which is the largest shareholder of the Canadian Securities Exchange.  In that capacity, we will continue to look to Tom for the benefit of his guidance and wisdom, and his continued support for our organization in its work.

PM: Other changes were also made to the board, with four new members elected at the annual general meeting. Tell us about the new board members, why the time was right to welcome them, and what it means for the CSE.

RC: There were a couple of drivers at the annual general meeting in September, which is when these changes took place.  The first was that we entered into  new recognition orders with the Ontario Securities Commission and the BC Securities Commission, our two principal regulators, and those orders required the exchange to have an independent chairperson.  Mr. Caldwell, by virtue of the shareholding of Urbana, was not considered an independent director of the organization.  Steve Blake, a continuing member of the board, graciously agreed to take on the responsibility of serving as chair.  Steve was elected by the shareholders at the AGM and we look forward to an excellent working relationship with him in his new role.

In addition, we were shorthanded, as former board member Mary Anne Palangio had become our chief financial officer earlier in the year, so we had a vacancy to fill.  And we also had some directors who had indicated to us that they were looking for different challenges, and they moved on with our best wishes.

Our new directors include Hema Barkhouse.  Hema is in the treasury group at Canadian Tire, where she is a senior officer and  has experience in accounting and finance in a public company setting.  Hema is chair of our audit committee and we look forward to her advice in managing the financial situation of the company.

Eric Sites is a resident of Chicago.  He works with Horizon Kinetics, which is one of our significant shareholders.  In his work with Horizon Kinetics, he has overseen investments in a number of exchanges around the world, so Eric is a wonderful addition to our board, both to advise management and potentially to open doors for us as we spread our wings internationally.

Brendan Caldwell, Tom’s son, is a new member of the board.  Brendan has been very closely aligned with his father at Caldwell Investment Management as well as Urbana Corporation.  Brendan also has worked with exchanges around the world and is extraordinarily knowledgeable about the space.

And last, but certainly not least, Michael Bluestein is a lawyer who founded a firm called Corporate Counsel just north or Toronto.  Michael has been a marvelous supporter of the Canadian Securities Exchange in his practice and he is the chair of our regulatory committee, which oversees the policymaking work of the exchange.  Michael is someone we have known well for quite a while.  We look forward to working together closely, particularly on our new listing rulebook.

Outlook for 2021

PM: Let’s look at the CSE’s plans for 2021. What goals have you set for the team? And what initiatives, both ongoing and new, will the CSE be focusing its time on?

RC: Goal setting in this space is always a little tricky.  We are subject to the whims of the market and even if we think at the beginning of the year that we are going to be focusing a lot of energy in a particular industry sector, we may find that investors decide to support different sectors in the marketplace with their investment and trading.  So, we can’t get too granular in the goals we set for the organization.

Clearly what we are seeing, though, is a significant expansion in trading activity, not just on the CSE but across Canada. Earlier in the year we were seeing roughly a billion shares a day trading across all markets.  And over the last six weeks or so we have gone to 2 billion.  What I can say, as someone who has been around this business for more than 30 years, is that this tends to be the pattern.  Canada will turn over X number of shares, and without warning it goes to 2X.  The interesting thing is that it happens without any real warning, and then it becomes the new baseline.

We had our previous record burst of activity in 2017 and 2018, which was driven by the US cannabis companies that joined the CSE and the extreme level of investment interest in them.  The other markets were not in line with those increases, but this time they are.  Everybody  has seen a doubling in turnover.  Did we see that coming?  Not really.  Volumes were healthy over the summer and we noticed increased retail participation, and that’s true on our exchange and some of the other exchanges catering to early-stage companies.  

Obviously, we are going to continue to explore and expand our use of social media platforms and virtual sessions, to get our message out and engage with as many people as we can, whether it is issuers or investors or other stakeholders.  We have learned a lot about what works and what does not work and we’ll apply that knowledge to our programs this year.  It is certainly less expensive than being in an airplane all the time and you can reach out and touch a lot more people this way as well.  It is going to be a permanent part of our programs moving forward and I think that will be the case for almost every industry.

That having been said, as we get later on in the year, I think there are a lot of folks who are going to want to see us face to face so my expectation is that we will be on the road quite a bit from October.

Overall, the picture appears quite robust from a listings perspective.  Certainly, the mining industry is in good shape, as it was our strongest sector in terms of new listings in 2020 by number of individual financings.  By dollar total the cannabis industry is still the champion by a wide measure because you have a number of issuers that raised very large sums of money last year.  We are also seeing more activity in the technology sector, some of it oriented toward health care.  Communications has obviously been a big theme.  And we have also made an impression in the growing psychedelics market.

PM: What other growth opportunities are there for the CSE over the longer term?

RC: We are going to continue to look at different international jurisdictions.  Listing on the CSE is a very cost-effective means for companies to access not just the Canadian public capital markets but the US private placement market as well.  By virtue of being a Canadian reporting issuer, without having to also undergo the pain and expense of becoming a reporting issuer in the United States, it really is one of the great bargains in our world.  We’ve had good success attracting companies from different countries from around the world.  And we’ve seen real interest from different Asian markets over the last six months.  It’s been challenging to do the kind of business development we’d like because we are all locked down.  But I can see as we move out of the pandemic that we’ll begin to capitalize on that interest from Asia.

I’d also highlight Australia, which is obviously a very large mining market.  The Australian miners have always had a lot of respect for the ability of Canada’s public markets to provide financing.  And we’ll be exploring ways to facilitate Australian company access to Canadian public markets through a CSE listing.

PM: Any final thoughts on the year ahead or topics we have not touched on so far?

RC: We are continuing to work on the delivery of a clearing and settlement system for tokenized securities.  I always caution that we are not talking about bitcoin or ether or other cryptocurrencies, but securities which use the smart contracts originally developed by those in the blockchain and cryptocurrency world and applying them to solve problems in the cash equities world.  I have been heartened over the course of the year, as we have attracted a number of partners to work with us on achieving this goal. These organizations are expert in different components of service and have existing customer relationships with issuers and the Canadian dealer community.  We’ll be talking more about this as the year progresses and hope to be in a position to get it into people’s hands later in 2021.

 Check out Part 1 of this interview here.

Ready Set Gold Corp. Joins the CSE for a Virtual Market Open

The CSE gave a warm welcome to Ready Set Gold Corp. (CSE:RDY) with a virtual Market Open on January 11th, 2021. 

Ready Set Gold Corp. is a mineral exploration company based out of Vancouver. Its principal business activities include acquiring and exploring exploration and evaluation assets. They have exploration and evaluation assets located in the Thunder Bay Mining Division within Priske Township, approximately 4 km south of the town of Schreiber, Ontario, on the northern shore of Lake Superior.

To open the day’s trading session, Ready Set Gold Corp. CEO and Director Christian Scovenna and his wonderful team joined the CSE for the first virtual Market Open of 2021. 

For more details about the CSE, including information on other Market Opens, please visit the CSE website or follow us on social media.