Metavesco, Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS WATERSIDE CAPITAL CORPORATION CONDENSED BALANCE SHEETS As of March 31, 2022 (Unaudited) and June 30, 2021 1 2 March 31, 2022 June 30, 2021 (Unaudited) Assets Current assets: Cash and cash equivalents $ 496,527 $ 44 Prepaid expenses 7,596 - Digital assets held, net of impairment 755,880 - Total current assets 1,260,003 44 Total assets $ 1,260,003 $ 44 Liabilities and Stockholders’ Equity (Deficit) Current liabilities: Accounts payable and accrued liabilities $ 27,916 $ 22,089 Promissory note - related party 100,000 - Accrued interest payable - related party - 36,441 Convertible note payable - related party - 149,838 Convertible promissory notes - related party (net of debt discount of $ 99,566 and $ 0 , respectively) 1,294 - Total current liabilities 129,210 208,368 Stockholders’ Equity (Deficit): Preferred stock; $ 0.0001 par value; 20,000,000 shares authorized - - Series A Convertible Preferred Stock: 22 and 0 shares issued and outstanding at March 31, 2022 and June 30, 2021 - - Common stock; $ 0.0001 par value; 100,000,000 shares authorized; 6,082,214 shares issued and outstanding at March 31, 2022 and June 30, 2021 608 608 Additional paid-in capital 19,129,924 17,721,420 Accumulated deficit ( 17,999,739 ) ( 17,930,352 ) Total stockholders’ deficit 1,130,793 ( 208,324 ) Total liabilities and stockholders’ equity (deficit) $ 1,260,003 $ 44 The accompanying notes are an integral part of these unaudited condensed interim financial statements. 3 WATERSIDE CAPITAL CORPORATION CONDENSED STATEMENTS OF OPERATIONS For the three and nine months ended March 31, 2022 and 2021 (Unaudited) 1 2 3 4 Three month period ended March 31, Nine month period ended March 31, 2022 2021 2022 2021 Revenue: Airdrops $ 17,439 $ - $ 17,439 $ - Liquidity pool fees 22,772 - 22,772 - Total Revenue 40,211 - 40,211 - Expense Administrative expenses 34,833 6,764 88,840 51,905 Interest expense 1,294 7,560 1,294 36,353 Impairment of digital assets held 51,983 - 51,983 - Total Expense 88,110 14,324 142,117 88,258 Other income (expense) Realized gain (loss) on sales/ exchange digital assets held 32,519 - 32,519 - Total Other income (expense) 32,519 - 32,519 - Net loss $ ( 15,380 ) $ ( 14,324 ) $ ( 69,387 ) $ ( 88,258 ) Net loss per share - basic and diluted $ ( 0.00 ) $ ( 0.00 ) $ ( 0.01 ) $ ( 0.01 ) Weighted average number of common shares outstanding - basic and diluted 6,082,214 6,082,214 6,082,214 6,082,214 The accompanying notes are an integral part of these unaudited condensed interim financial statements. 4 WATERSIDE CAPITAL CORPORATION CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) For the three and nine months ended March 31, 2022 and 2021 (Unaudited) Series A Convertible Preferred Stock ($0.0001 par value) Common Stock ($0.0001 par value) Additional paid-in Accumulated Total stockholders’ Shares Par Value Shares Par Value capital deficit equity Balance, December 31, 2021 - $ - 6,082,214 $ 608 $ 17,929,064 $ ( 17,984,359 ) $ ( 54,687 ) Issue of Series A Convertible Preferred Stock 22 $ - - - 1,100,000 - 1,100,000 Beneficial conversion feature - - - - 100,860 - 100,860 Net loss - - - - - ( 15,380 ) ( 15,380 ) Balance, March 31, 2022 22 $ - 6,082,214 $ 608 $ 19,129,924 $ ( 17,999,739 ) $ 1,130,793 Series A Convertible Preferred Stock ($0.0001 par value) Common Stock ($0.0001 par value) Additional paid-in Accumulated Total stockholders’ Shares Par Value Shares Par Value capital deficit equity Balance at June 30, 2021 - $ - 6,082,214 $ 608 $ 17,721,420 $ ( 17,930,352 ) $ ( 208,324 ) Issue of Series A Convertible Preferred Stock 22 $ - - - 1,100,000 - 1,100,000 Beneficial conversion feature - - - - 100,860 - 100,860 Forgiveness of convertible note payable, accrued interest and advances - related party - - - - 207,644 - 207,644 Net loss - - - - - ( 69,387 ) ( 69,387 ) Balance, March 31, 2022 22 $ - 6,082,214 $ 608 $ 19,129,924 $ ( 17,999,739 ) $ 1,130,793 Series A Convertible Preferred Stock ($0.0001 par value) Common Stock ($0.0001 par value) Additional paid-in Accumulated Total stockholders’ Shares Par Value Shares Par Value capital deficit equity Balance, December 31, 2020 - $ - 6,082,214 $ 608 $ 17,713,087 $ ( 17,887,624 ) $ ( 173,929 ) Beneficial conversion feature - - - - 3,333 - 3,333 Net loss - - - - - ( 14,324 ) ( 14,324 ) Balance, March 31, 2021 - $ - 6,082,214 $ 608 $ 17,716,420 $ ( 17,901,948 ) $ ( 184,920 ) Series A Convertible Preferred Stock ($0.0001 par value) Common Stock ($0.0001 par value) Additional paid-in Accumulated Total stockholders’ Shares Par Value Shares Par Value capital deficit equity Balance at June 30, 2020 - $ - 6,082,214 $ 608 $ 17,691,420 $ ( 17,813,690 ) $ ( 121,662 ) Beneficial conversion feature - - - - 25,000 - 25,000 Net loss - - - - - ( 88,258 ) ( 88,258 ) Balance, March 31, 2021 - $ - 6,082,214 $ 608 $ 17,716,420 $ ( 17,901,948 ) $ ( 184,920 ) The accompanying notes are an integral part of these unaudited condensed interim financial statements. 5 WATERSIDE CAPITAL CORPORATION CONDENSED STATEMENTS OF CASH FLOW For the nine months ended March 31, 2022 and 2021 (Unaudited) 1 2 Nine month periods ended December 31, 2022 2021 Cash Flows from Operating Activities: Net loss $ ( 69,387 ) $ ( 88,258 ) Adjustments to reconcile net loss to net cash used in operating activities Amortization of debt discount 1,294 25,000 Impairment of digital assets held 51,983 - Forgiveness of interest - related party 2,997 - Realized (gain) loss on sales/ exchange digital assets held ( 32,519 ) - Digital assets received as revenue ( 40,211 ) - Digital assets paid as expense 5,044 - Changes in operating assets and liabilities: Increase in prepaid ( 7,596 ) - (Decrease) increase in accounts payable and accrued liabilities 5,828 3,300 Increase in accrued interest payable - related party - 11,352 Net cash used in operating activities ( 82,567 ) ( 48,606 ) Cash Flows from Investing Activities: Purchase of digital assets held ( 639,317 ) - Net cash provided by financing activities ( 639,317 ) - Cash Flows from Financing Activities: Advances from related party 18,367 - Proceeds from issuance of promissory note payable - related party 100,000 - Proceeds from issuance of convertible note payable - related party - 37,500 Issuance of Series A Convertible Preferred Stock 1,100,000 - Net cash provided by financing activities 1,218,367 37,500 Net change in cash and cash equivalents 496,483 ( 11,106 ) Cash and cash equivalents, beginning of period 44 12,625 Cash and cash equivalents, end of period $ 496,527 $ 1,519 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid during period for: Interest paid $ - $ - Income taxes paid $ - $ - Non-cash Investing and Financing Activities Purchase of digital assets held with convertible promissory notes - related party $ 100,860 $ - Purchase of digital assets held with other digital assets $ 1,372,374 $ - Proceeds from sale of digital assets for other digital assets $ 1,271,514 $ - Intrinsic value of embedded beneficial conversion feature on convertible note payable - related party and convertible promissory notes - related party $ 100,860 $ 25,000 Forgiveness of convertible note payable, accrued interest and advances - related party $ 207,644 $ - The accompanying notes are an integral part of these unaudited condensed interim financial statements. 6 WATERSIDE CAPITAL CORPORATION NOTES TO UNAUDITED FINANCIAL STATEMENTS March 31, 2022 NOTE 1 – ORGANIZATION AND OPERATIONS Waterside Capital Corporation (the “Company”) was incorporated in the Commonwealth of Virginia on July 13, 1993 and was a closed-end investment company licensed by the Small Business Administration (the “SBA”) as a Small Business Investment Company (“SBIC”). The Company previously made equity investments in, and provided loans to, small businesses to finance their growth, expansion, and development. Under applicable SBA regulations, the Company was restricted to investing only in qualified small businesses as contemplated by the Small Business Investment Act of 1958. As a registered investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”), the Company’s investment objective was to provide its shareholders with a high level of income, with capital appreciation as a secondary objective. The Company made its first investment in a small business in October 1996. On May 28, 2014, with the Company’s consent, the United States District Court for the Eastern District of Virginia, having jurisdiction over an action filed by the SBA (the “ Court ”), entered a Consent Order and Judgment Dismissing Counterclaim, Appointing Receiver, Granting Permanent Injunctive Relief and Granting Money Judgment (the “ Order ”). The Order appointed the SBA receiver of the Company for the purpose of marshaling and liquidating in an orderly manner all of the Company’s assets and entered judgment in favor of the United States of America, on behalf of the SBA, against the Company in the amount of $ 11,770,722 . The Court assumed jurisdiction over the Company and the SBA was appointed receiver effective May 28, 2014. The Company effectively stopped conducting an active business upon the appointment of the SBA as the receiver and the commencement of the court-ordered receivership (the “ Receivership ”). Over the course of the Receivership, the activity of the Company was limited to the liquidation of the Company’s assets by the receiver and the payment of the proceeds therefrom to the SBA and for the expenses of the Receivership. On June 28, 2017, the Receivership was terminated with the entry of a Final Order by the Court. The Final Order specifically stated that “Control of Waterside shall be unconditionally transferred and returned to its shareholders c/o Roran Capital, LLC (“Roran”) upon notification of entry of this Order”. Upon termination of the Receivership, Roran took possession of all books and records made available to it by the SBA. The Company filed with the SEC an application pursuant to Section 8(f) of the Investment Company Act of 1940 for an order declaring that the Company has ceased to be a registered investment company. On April 22, 2020, the SEC issued an order under Section 8(f) of the Investment Company Act of 1940, as amended, declaring that the Company has ceased to be an investment company. As a result, the Company is now a reporting company under the Securities Exchange Act of 1934, as amended. On September 2, 2021, the Company entered into a Stock Purchase Agreement (the “SPA”) by and between (i) the Company (ii) Ryan Schadel (“Buyer”) and (iii) Roran. Roran agreed to sell to the Buyer 4,247,666 shares of common stock of the Company held by Roran for a total purchase price of $ 385,000 . In conjunction with the SPA, the Roran agreed to forgive all amounts due to Roran by the Company totaling $ 207,644 , which is comprised of convertible note payable – related party, accrued interest payable – related party, and advances from related party. The Buyer acquired 4,247,666 shares of the Company’s Common Stock, representing 69.7 % of the issued and outstanding shares of Common Stock. As such, the SPA resulted in a change of control of the Company. Effective November 29, 2021, the Company converted from a Virginia corporation to a Nevada corporation. On December 15, 2021, the Company filed with the Nevada Secretary of State amended and restated articles of incorporation. The amended and restated articles had the effect of (i) increasing the Company’s authorized common stock to 100 million shares, (ii) increasing the Company’s authorized preferred stock to 20 million shares, and (iii) reducing the par value of each of the Company’s common stock and preferred stock to $ 0.0001 per share. Common stock and additional paid-in capital for all periods presented in these interim unaudited financial statements have been adjusted retroactively to reflect the reduction in par value. On December 17, 2021, the majority shareholder and board of directors approved an amendment to the amended and restated articles of incorporation that would change the Company’s name from Waterside Capital Corporation to Metavesco, Inc. The name change will not be effective until it is cleared by the Financial Industry Regulatory Authority (“FINRA”). In March 2022, the Company commenced operations as a web3 enterprise. The Company generates income as a liquidity provider, via decentralized exchanges such as Uniswap. Additionally, the company farms tokens via Proof of Stake protocols on decentralized exchanges as well as centralized exchanges including Coinbase exchange. The Company also invests in promising NFT projects and virtual land, primarily on EVM protocols. The interim unaudited financial statements herein have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The accompanying interim unaudited financial statements have been prepared under the presumption that users of the interim financial information have either read or have access to the audited financial statements for the latest fiscal year ended June 30, 2021. Accordingly, note disclosures which would substantially duplicate the disclosures contained on June 30, 2021, audited financial statements have been omitted from these interim unaudited financial statements. The Company evaluated all subsequent events and transactions through the date of filing this report. Certain information and note disclosures normally included in financial statements prepared in accordance with the United States generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three and nine months ended March 31, 2022, are not necessarily indicative of the results that may be expected for the year ending June 30, 2022. For further information, refer to the audited financial statements and notes for the year ended June 30, 2021, included in the Company’s Annual Report on Form 10-K filed with the SEC on September 1, 2021. 7 Going Concern The accompanying financial statements of our Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The Company effectively ceased operations, has no significant liquid assets and continues to have net losses through the date of these financial statements. Our financial statements have been presented on the basis that our business is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We are subject to the risks and uncertainties associated with a business with no operating business or assets and no revenue, as well as limitations on our capital resources. We have incurred losses and negative operating cash flows since the Receivership, and we expect to continue to incur losses and negative operating cash flows at least through the near future. The Company on October 18, 2021, issued to Ryan Schadel, the Company’s Chief Executive Officer, sole director and majority stockholder, a demand promissory note for $ 100,000 in cash. On March 16, 2022, the Company entered into Stock Purchases Agreements whereby the Company issued 22 shares to Series A Convertible Preferred Stock and various Warrants for $ 1,100,000 in cash. At March 31, 2022, $ 95,854 of cash was in held at a financial institution and $ 400,673 was held at Coinbase, Inc. The Company expects over the next twelve months, cash held at a financial institution will be expended on professional fees, transfer agent, Edgar agent and other administrative costs. The cash held at Coinbase Inc. will be deployed to purchase crypto assets to generate staking rewards and liquidity pool fees. We hope to start paying some of our suppliers and contractors in crypto assets in the coming months. However, there can be no assurance we will be able to pay any of our suppliers and contractors in digital assets. In December 2019, a novel coronavirus disease (“COVID-19”) was initially reported, and in March 2020, the World Health Organization characterized COVID-19 as a pandemic. COVID-19 has had a widespread and detrimental effect on the global economy as a result of the continued increase in the number of cases and affected countries and actions by public health and governmental authorities, businesses, other organizations, and individuals to address the outbreak, including travel bans and restrictions, quarantines, shelter in place, stay at home or total lock-down orders and business limitations and shutdowns. The ultimate impact of the COVID-19 pandemic on our business is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration and severity of the COVID-19 pandemic and any additional preventative and protective actions that governments may direct. Management believes the capital markets have been negatively impacted by COVID-19, which negatively impacts the Company’s ability to consummate a merger transaction. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s June 30, 2021 financial statements included in its 2021 Annual Report on Form 10-K. Fiscal Year-End The Company elected June 30 as its fiscal year-end date. Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience, and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Cash and cash equivalents Cash and cash equivalents include cash and interest-bearing highly liquid investments held at financial institutions, cash on hand that is not restricted as to withdrawal or use with an initial maturity of three months or less, and cash held in accounts at crypto trading venues. At March 31, 2022, $ 95,854 of cash was at held a financial institution which is a member of the Federal Deposit Insurance Corporation (“FDIC”) and $ 400,673 was held at Coinbase, Inc. (“Coinbase”). The contract with Coinbase, Inc. requires USD balances in a client’s fiat wallet be held in an omnibus custodial account for the benefit of Coinbase’s customers. These accounts are either omnibus bank accounts insured by the FDIC (currently up to $ 250,000 per entity) or trust accounts holding short term U.S. treasuries. 8 Intangible Assets Digital assets held by the Company are accounted for as intangible assets with indefinite useful lives, and are initially measured at cost. The Company assigns costs to transactions on a first-in, first-out basis (FIFO). An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital assets at the time its fair value is being measured. Cryptocurrencies are subject to impairment losses if the fair value a cryptocurrency decreases below the carrying value at any time during the period. The fair value is measured using the quoted price in the principal market of the cryptocurrency. The Company currently obtains the quoted price of cryptocurrency from www.coinmarketcap.com . Liquidity pool tokens and non-fungible tokens are subject to impairment losses if the fair value a token decreases below the carrying value at the end of each quarterly accounting period. Impairment for tokens is assessed quarterly due to each token being a unique asset and due to the illiquid markets in which these tokens trade. The Company is continuously reviewing available markets and information and its methodology when determining the fair value of tokens. The Company currently reviews quoted prices of its tokens and comparable tokens at https://uniswap.org/ and https://opensea.io . Impairment expense is reflected in total expense in the statements of operations. Subsequent reversal of impairment losses is not permitted. The sales of digital assets held are included within investing activities in the accompanying statements of cash flows and any realized gains or losses from such sales are included in other income (expense) in the statements of operations. Revenue recognition There is currently no definitive guidance under GAAP or alternative accounting framework for the accounting for digital assets recognized as revenue or held, and management has exercised significant judgment in determining the appropriate accounting treatment. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies, which could have an effect on the Company’s financial position and results from operations. Revenue is recognized when the award is claimed and deposited in the Company wallet. The transaction consideration the Company receives is noncash in the form of digital assets. Revenue is measured at the fair value of the digital assets awards received using the quoted price Airdrop Airdrop is the distribution of tokens without compensation generally undertaken with a view of increasing awareness of a new token, to encourage adoption of new token and to increase liquidity in the early stages of a token project. Liquidity Pools The Company earns fees by providing liquidity on Uniswap V2 and Uniswap V3. The Company earns fees proportionate to the liquidity they have supplied to the exchange. The fee for each trade is set at 0.05% for stable coins, 0.3% for most pairs and 1.0% for exotic pairs. The fees earned by the Company depends on the risk characteristics of each pair of tokens selected and the price range liquidity is provided. Uniswap V2 requires users to provide liquidity over the entire price curve, whereas Uniswap V3 provides users with the provide liquidity over a price range. Convertible Financial Instruments The Company bifurcates conversion options from their host instruments and accounts for them as free-standing derivative financial instruments if certain criteria are met. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable GAAP. When the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, discounts are recorded for the intrinsic value of conversion options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the instrument. Beneficial conversion feature – The issuance of the convertible debt generated a beneficial conversion feature (“BCF”), which arises when a debt or equity security is issued with a non-separated embedded conversion option that is beneficial to the investor or in the money at inception because the conversion option has an effective strike price that is less than the market price of the underlying stock at the commitment date. The Company recognized the BCF by allocating the intrinsic value of the conversion option, which is the number of shares of common stock available upon conversion multiplied by the difference between the effective conversion price per share and the fair value of common stock per share on the commitment date, resulting in a discount on the convertible debt (recorded as a component of additional paid-in capital). The BCF is amortized into interest expense over the life of the related debt. Related Parties The Company follows subtopic 850-10 of the ASC for the identification of related parties and disclosure of related party transactions. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and, (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. 9 Commitments and Contingencies The Company follows ASC 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. Management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, management evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Deferred Tax Assets and Income Taxes Provision The Company follows the provisions of ASC 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. ASC 740-10-25-13 also provides guidance on de-recognition, classification, interest, and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Tax years that remain subject to examination by major tax jurisdictions are generally the prior three (3) years for federal purposes, and the prior four (4) years for state purposes; however, as a result of the Company’s operating losses, all tax years remain subject to examination by tax authorities. Net Loss Per Common Share The Company computes net income or loss per share in accordance with ASC 260 Earnings Per Share. Under the provisions of the Earnings per Share Topic ASC, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. Fair Value of Financial Instruments The Company follows paragraph 825-10-50-10 of ASC for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of ASC (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Transactions involving related parties cannot be presumed to be carried out on an arms-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. 10 Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard-setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. NOTE 3 – DIGITAL ASSETS HELD, NET OF IMPAIRMENT Digital assets held, net of impairment have consisted of: SCHEDULE OF DIGITAL ASSETS HELD NET OF IMPAIRMENT Cryptocurrency Tokens Total Balance, July 1, 2021 $ - $ - $ - Purchase of digital assets 1,638,345 373,346 2,011,691 Proceeds from sale of digital assets ( 1,164,272 ) ( 107,242 ) ( 1,271,514 ) Realized gain loss on sales/ exchange digital assets 13,148 19,371 32,519 Acquired digital assets by Airdrop 17,439 - 17,439 Acquired digital assets by Liquidity Pools 22,772 - 22,772 Digital assets used to pay fees ( 5,044 ) - ( 5,044 ) Impairment charges ( 36,473 ) ( 15,510 ) ( 51,983 ) Balance, March 31, 2022 $ 485,915 $ 269,965 $ 755,880 As at March 31, 2022, the Company’s holdings of digital assets held, net of impairment consists of: SCHEDULE OF ASSETS DIGITAL HOLDING IMPAIRMENTS Units held Carrying value, at cost less impairment Cryptocurrency APE 20,175.35 $ 224,447 ETH 72.34509 209,992 SOL 200 24,040 USDC 12,557.37 12,595 EFI 20,602.95 8,624 DAO 2,438.682 5,829 STG 116.4718 388 Cryptocurrency Total $ 485,915 Liquidity Pool Tokens Uniswap V3 3 $ 151,304 Liquidity Pool Tokens Total $ 151,304 Non-Fungible Tokens Mutant Ape Yacht Club 1 $ 49,470 Dour Darcels 4 8,588 Council of Kingz 3 2,199 Board Ape Kennel Club 1 23,099 Meebits 2 35,305 Non-Fungible Tokens Total $ 118,661 11 NOTE 4 – NOTES PAYABLE – RELATED PARTIES Roran Obligations On September 19, 2017, the Company entered into a Convertible Loan Agreement with Roran (the “Loan Agreement”). Pursuant to the Loan Agreement, Roran agreed to loan the Company an amount not to exceed a total of $150,000 in principal over 18 months. On June 17, 2019, the Company amended the Loan Agreement increasing the loan amount to $ 200,000 and extending the maturity date to September 19, 2019 . Each advance under the Loan Agreement will be documented under a Convertible Promissory Note issued by the Company in favor of Roran (the “Note”). The Note bears interest at the rate of 12 % per annum. Roran has the right to convert all or any portion of the Note into shares of the Company’s common stock at a conversion price equal to 60 % of the share price. The Company recorded a BCF due to the conversion option of $ 116,800 , which has been fully amortized as of September 30, 2019. The debt discount has been amortized as interest expense through September 30, 2019. On December 13, 2019, the Company amended its Loan Agreement Note with Roran as follows: (i) the total amount to be loaned was increased to $ 250,000 , and (ii) the maturity date was extended to June 19, 2020 . Although the maturity date has passed, Roran has agreed to extend the loan and advance additional funds until further negotiations have been concluded. On June 8, 2020, Roran converted $ 124,500 principal amount of its promissory note with the Company and $ 25,500 of accrued and unpaid interest thereon, totaling $ 150,000 , into 4,166,666 shares of Company Common Stock at the stated conversion price per share of $ 0.036 . The remaining balance due on the promissory note, as of the conversion date, was $ 104,838 in principal and $ 19,988 in interest. As a result of the advances made pursuant to the Loan Agreement, the Company has incurred total obligations of $ 149,838 as of June 30, 2021 (net of debt discounts and exclusive of accrued interest). During the nine months ended March 31, 2022, Roran made non-interest bearing, unsecured, short-term cash advances to the Company totaling $ 18,367 for the purpose of paying all accounts payable before the closing date of the SPA. On September 2, 2021, in conjunction with the SPA, Roran agreed to forgive all obligations due to Roran by the Company totaling $ 207,644 which is comprised of convertible note payable – related party, accrued interest payable – related party, and advances from related party. SCHEDULE OF AMOUNTS OWNED TO RELATED PARTIES Debts forgiven by Roran on September 2, 2021 Convertible note payable – related party $ 149,838 Interest on convertible note payable – related party 39,439 Advance from related party 18,367 Forgiveness of convertible note payable, accrued interest and advances – related party $ 207,644 As a result of Roran agreeing to forgive all obligations, as of March 31, 2022, no obligations are due to Roran. Demand Promissory Note On October 18, 2021, the Company issued a Promissory Note in the principal amount of $ 100,000 (the “Promissory Note”) for cash to Ryan Schadel (the “Holder”), the Company’s Chief Executive Officer, sole director and majority stockholder. The Promissory Note bears interest at the rate of 0.01 % per annum. Any unpaid principal amount and any accrued interest is due on October 18, 2022. The Holder may demand payment of all or any portion of the outstanding principal and interest at any time. The Promissory Note is unsecured and there is no prepayment penalty. Convertible Promissory Notes On March 4, 2022, the Company issued a Convertible Promissory Note in the principal amount of $ 40,874 (the “Promissory Convertible Note”), for value received being comprised of 1 (one) bitcoin, to Ryan Schadel (the “Holder”), the Company’s Chief Executive Officer, sole director and majority stockholder. The Convertible Promissory Note bears interest at the rate of 3.5 % per annum. Any unpaid principal amount and any accrued interest is due on March 4, 2027. The Promissory Note is unsecured and there is no prepayment penalty. At the option of the Holder, the Promissory Convertible Note is convertible into shares of the Company’s common stock at a conversion price of $ 0.50 per share. The closing price of the Company’s common stock was $ 1.25 per share on the date the Promissory Convertible Note was issued. As a result of the conversion price being lower than the market price of the Company’s common stock on the date of issuance, the Company recognized a beneficial conversion feature of $ 40,874 upon issuance. The Company recorded the beneficial conversion feature as a discount (up to the face amount of the applicable note) to be amortized over the life of the related note. During the three and nine months ended March 31, 2022, $ 604 of discount amortization is included in interest expense. At March 31, 2022, there was an unamortized discount balance of $ 40,270 to be amortized through March 2027. On March 10, 2022, the Company issued a Convertible Promissory Note in the principal amount of $ 59,986 (the “Promissory Convertible Note”), for value received being comprised of 22.86012412 Ether, to Ryan Schadel (the “Holder”), the Company’s Chief Executive Officer, sole director and majority stockholder. The Convertible Promissory Note bears interest at the rate of 3.5 % per annum. Any unpaid principal amount and any accrued interest is due on March 10, 2027. The Promissory Note is unsecured and there is no prepayment penalty. At the option of the Holder, the Promissory Convertible Note is convertible into shares of the Company’s common stock at a conversion price of $ 0.50 per share. The closing price of the Company’s common stock was $ 1.42 per share on the date the Promissory Convertible Note was issued. As a result of the conversion price being lower than the market price of the Company’s common stock on the date of issuance, the Company recognized a beneficial conversion feature of $ 59,986 upon issuance. The Company recorded the beneficial conversion feature as a discount (up to the face amount of the applicable note) to be amortized over the life of the related note. During the three and nine months ended March 31, 2022, $ 690 of discount amortization is included in interest expense. At March 31, 2022, there was an unamortized discount balance of $ 59,296 to be amortized through March 2027. 12 NOTE 5 - RELATED PARTY TRANSACTIONS The following individuals and entities have been identified as related parties based on their family affiliation with our former CEO and former Chairman of the Board: Yitzhak Zelmanovitch Roran Capital LLC The following amounts were owed to related parties affiliated with the former CEO and former Chairman of the Board, at the dates indicated: SCHEDULE OF CONVERTIBLE DEBTS March 31, 2022 June 30, 2021 Convertible Note Payable $ - $ 149,838 Interest on Convertible Note Payable - 36,441 Total $ - $ 186,279 NOTE 6 – SHAREHOLDER DEFICIT On September 2, 2021, the Company entered into a Stock Purchase Agreement (the “SPA”) by and between (i) the Company (ii) Ryan Schadel (“Buyer”) and (iii) Roran Capital LLC (“Roran”). Roran agreed to sell to the Buyer 4,247,666 shares of common stock of the Company held by Roran for a total purchase price of $ 385,000 . In conjunction with the SPA, Roran agreed to forgive all amounts due to Roran by the Company totaling $ 207,644 , which is comprised of convertible note payable – related party, accrued interest payable – related party and advances from related party. In accordance with ASC 470-50-40-2, the resulting forgiveness of convertible note payable, accrued interest and advances – related party of $ 207,644 is recorded as an increase in additional paid-in capital within the statements of shareholders’ deficit, as the debt forgiven is in essence a capital transaction. On December 15, 2021, the Company filed with the Nevada Secretary of State amended and restated articles of incorporation. The amended and restated articles had the effect of (i) increasing the Company’s authorized common stock to 100 million shares, (ii) increasing the Company’s authorized preferred stock to 20 million shares, and (iii) reducing the par value of each of the Company’s common stock and preferred stock to $ 0.0001 per share. Common stock and additional paid-in capital for all periods presented in these interim unaudited financial statements have been adjusted retroactively to reflect the reduction in par value. On March 11, 2022, the Company filed with the State of Nevada a certificate of designations for the Company’s Series A Convertible Preferred Stock (“Series A Stock”). The Series A Certificate of Designations provides (i) t he number of authorized shares will be 100. (ii) each share will have a stated value of $ 50,000 (iii) each share into 100,000 shares of Company common stock, subject to a 9.99 % equity blocker (iv) shares are non-voting and (v) shares are not entitled to receive dividends or distributions. On March 16, 2022, the Company entered into Stock Purchases Agreements whereby the Company issued 22 shares to Series A Stock and various Warrants for $ 1,100,000 in cash. The Warrants comprise of 2,200,000 Company common stock issuable at $ 1.30 per share, 2,200,000 Company common stock issuable at $ 1.50 per share and 2,200,000 Company common stock issuable at $ 1.75 per share, Upon issuance on March 16, 2022, the Warrant remain exercisable for a period of five years. The weighted average remaining legal life of the warrants at March 31, 2022 is 4.96 years. NOTE 7 – SUBSEQUENT EVENTS On May 6, 2022, the Company issued a Convertible Promissory Note in the principal amount of $ 100,000 (the “Promissory Convertible Note”), for cash, to Ryan Schadel (the “Holder”), the Company’s Chief Executive Officer, sole director and majority stockholder. The Convertible Promissory Note bears interest at the rate of 3.25 % per annum. Any unpaid principal amount and any accrued interest is due on May 6, 2027. The Promissory Note is unsecured and there is no prepayment penalty. At the option of the Holder, the Promissory Convertible Note is convertible into shares of the Company’s common stock at a conversion price of $ 0.50 per share. On May 9, 2022, the Company issued a Convertible Promissory Note in the principal amount of $ 100,000 (the “Promissory Convertible Note”), for cash, to Ryan Schadel (the “Holder”), the Company’s Chief Executive Officer, sole director and majority stockholder. The Convertible Promissory Note bears interest at the rate of 3.25 % per annum. Any unpaid principal amount and any accrued interest is due on May 9, 2027. The Promissory Note is unsecured and there is no prepayment penalty. At the option of the Holder, the Promissory Convertible Note is convertible into shares of the Company’s common stock at a conversion price of $ 0.50 per share. On May 10, 2022, the Company issued a Convertible Promissory Note in the principal amount of $ 20,000 (the “Promissory Convertible Note”), for cash, to Timothy Hackbart (the “Holder”). The Convertible Promissory Note bears interest at the rate of 3.25 % per annum. Any unpaid principal amount and any accrued interest is due on May 10, 2027. The Promissory Note is unsecured and there is no prepayment penalty. At the option of the Holder, the Promissory Convertible Note is convertible into shares of the Company’s common stock at a conversion price of $ 0.50 per share. 13