exgate presentation 020514

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www.exgate.com

EXGATE LTDTRADE BITCOIN GLOBALLY

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EXGATE

Trade Bitcoin Globally MT4

WHAT IS EXGATE ?

EXGATE is a global trading solution for institutions that paves the way for

FX, Commodity, Derivative markets & Bitcoin to be physically delivered &

exchanged in the open markets.

The EXGATE solution establishes an industry standard bar for Bitcoin

integration into any existing financial market infrastructure with a

high‐performance, scalable, low‐latency global Electronic Communication

Network (ECN), which aggregates conventional/non‐conventional liquidity

providers with end‐users.

Our flexible engine bridges the MetaTrader4 Platform as a final piece to a

full turn‐key Institutional trading solution for professional traders to add

Bitcoin to their trading portfolios & models.

EXGATE


WHAT IS THE PROBLEM?

BITCOIN COMMUNITY CURRENTLY REMAINS INEFFICIENT AND

LIMITED DUE TO THE FOLLOWING FACTORS:

Extremely poor technological solutions

Lack of industry standard practices

Less than 5% of all arbitrages being truly realized due to extremely

substandard technology & integrations

Exchanges are not connected to each other

BTC currency pairs are transacted through manual procedures

Non‐standard settlements

Non‐deliverable Bitcoin CFDs hurt liquidity & deliverable assets

The majority of trading occurs off‐exchange in auction style non‐computerized formats & needs technological innovation

EXGATE


SOLUTION: Flexible Full-Turn-Key

EXGATE COMPLETE SOLUTION INCLUDES, BUT NOT LIMITED TO:

1. Written in Generic Native "C" to Improve Hardware Adoption, Latency and Digital Currency Implementation

2. Brokerages, Market Makers, Hedge Funds, High Frequency Traders, Money Managers, Trusts and Exchange-to-Exchange

3. Industry Standard MetaTrader4 (MT4) Interface with FIX Bridge and Multiple MT4 Plug-ins for Global Wall Street adoption of Physical Bitcoin Trading and Delivery Capabilities

4. Web Browser Interface and Mobile App Capabilities for Expanded Economic Appeal beyond MT4 Users

5. Bitcoin PHYSICAL Delivery to and from any External Corporate Wallet to MT4 Clients Trading Accounts

6. PHYSICAL Bitcoin Trading Capabilities directly to open FOREX, Commodities, Metals and Energy markets

7. Fiat-to-Fiat Currency PHYSICAL conversion Built-in Capability8. Customized Instant Risk Management at Exchange Level and Sub-Level per

Exchange per Tradable Instrument setup Feature9. Price Best Bid & Offer from Multiple Exchanges, Financial and Non-Financial

entities and Order Matching, facilitating Institutional Size Trading

EXGATE


SOLUTION: Flexible Full-Turn-Key

10. Matching and Limit Order Capability enables 24 x 7 Trading in Bitcoin, FOREX, Commodities, Derivatives and etc.

11. Routing of Limit Orders to Liquidity Providers or the capability to Match Client-to-Client orders

12. Algorithmic Trading Ready with Instant Switching feature to change Pre-Loaded Program Models

13. Market Inversion Trading Opportunities through Proprietary Engine not available on standard MT4

14. Latency Sensitive Goals currently at <10ms with short term Objective of <25us15. Bitcoin Exchange System upgrade as a PARTIAL or FULL-SOLUTION to comply

with Industry Standard Trading Systems 16. MT4 Community of over 1 million clients worldwide can now access Bitcoin

exchange & PHYSICAL DELIVERY through the EXGATE MT4 Solution17. Complete Industry Standard Back-End , Risk Management Tools, Institutional

Reporting/Tracking and Functionality 18. Virtual Real Time Demo Trading Platform19. Full Integration Capabilities to all Professional Trading Platforms and Operating

Systems (not just MT4 Server)

EXGATE


BTC MetaTrader4 Platform

EXGATE


METATRADER 4 PLATFORM

MT4 Server, as the most popular worldwide recognized FX platform, combined with Pay Server & Bitcoin Server, becomes the main marketing tool to be offered to all existing MT4 based Brokers:

• Over 1 million users instant access

• Over $5 trillion transacted in the FX markets daily

FIX MT4 Bridge with Limit Order routing and matching capabilities

Physical delivery of Bitcoins directly to MT4 platform clients accounts

Physical exchange of Bitcoins to:

• Fiat Currencies

• Metals

• Commodities

• Energy

Dual Account opening process enables funding and trading in Crypto

and / or Fiat Currencies

EXGATE


THE MARKET

Estimated that 70% of Bitcoin transactions occur

Off - Exchange, which now can be automated

through EXGATE

$37B

* Volume Bitcoin in 2014

$555M

** Commission & Spread revenues

* Based on www.bitcoincharts.com volume plus 2014 estimation

** Assuming 0.5 % average Commissions & average Spread Buy & Sell

EXGATE


COMPETITIVE ADVANTAGE

Generic “C” language, BBO, Order Matching, Built-in WEB Server, FIX Engine

Limit Order forwarding and Matching capabilities allows 24 x 7 FX, Commodities, Derivatives & Crypto trading.

EXGATE’s focus is on market makers, high speed traders, hedge funds & financial institutions that want to trade Bitcoin efficiently.

Professional traders who need physical delivery & exchange of Bitcoin to Currencies for specific trading strategies.

MT4’s use as retail distribution, completing a full solution offered to institutions.

Our proprietary "Latency Reduction" project is the highest priority to enable Exchange‐to‐Exchange Cross‐Currency trading.

Our engine's flexibility allows any B2B and / or B2C to be connected to the customized aggregated liquidity pool, creating a seamless trading web terminal.

Experienced team from all sides of trading world & developing FX trading systems with over 20 years experience each.

EXGATE


OPPORTUNITY

EXGATE is the first & only full‐solution that treats Bitcoin asa tradable commodity, provides physical exchange &delivery of Bitcoin to any major Currency in the openmarkets.

Our total solution has the speed, the right technology &experienced team to attract the most demanding high‐speed traders, arbitrageurs & hedge funds to furtherincrease volume, profitability & efficiencies.

EXGATE


FULLY FUNCTIONAL BACK END

RISK MANAGEMENT, RAW TIGHT SPREADS, POSITIONS, BBO,

MATCHING SYSTEM, CUSTOMIZED LIQUITY, HIGH FREQUENCY, HISTORY

EXGATE


Risk Management GUI

EXGATE


Web Based Client GUI

ALLOWS TRADING ON ANY TYPE OF OPERATING SYSTEM AND SMART PHONE

EXGATE


MARKETING STRATEGY

Market Maker direct Demo Educational campaign

High Frequency trading competition / partnership

B2B & BTC direct contact

Demo / Educational Accounts

MetaTrader 4 over 1,000,000 user base

Retail Trading Competitions

BTC Trading Gaming Partnership

Website Optimization

Trade Shows

EXGATE


EASY LIQUIDITY INTEGRATION

Exchanges E-Commerce Wallets ATM Networks Brokerages Banks Non-Bank Institutions Hedge Funds Latency Sensitive Traders Alternative Trading Systems Import and Export Retail Participants

EXGATE


.

OUR TEAM

DMITRY BATASHIVILI, CEO/Founder

• Entrepreneur & Tech Specialist

• Building trading systems since 1998

• Architected FX system for Major Banks

GREGORY MAZZEO, Business Dev

• Entrepreneur & FX veteran

• Partner in FX clearing since 2001

• Former President FX Clearing Corp

FRED HENTSCHEL, CTO

• Chief Financial Industry Programmer

• Admin financial systems since 1999

• Worked on all sides of FX trading world

EXGATE


OUR PARTNERS AND CLIENTS

JSC CAUFEX

LMAX

BitReserve

BTC China

Atlas ATS

AMI

CoinSetter

ItBit

ANX

Spottraderfx

NDB

FxOne

CoinDeavors

Quickey Coin

EXGATE


BUSINESS MODEL

Transaction fees for large volume Bitcoin trading 0.5% to 0.1%

Estimated Revenue:

• 2015 - $5M

• 2016 - $15M

• 2017 - $50M

Retail Fees 1%

FX MetaTrader4 and MetaTrader4 Bridge fees $3.50 per million of notional volume traded

Licensing for Turn-Key market-making exchange platform- one time fee of $75,000 plus monthly maintenance and transaction fees

Customized Software Development

Packaging and Reselling of Price Feed

Packaging and Reselling of Market Data

EXGATE


USE OF FUNDS

Compensation New Employees - $600,000

Outsourced Computing - $500,000

Software and Hardware for Employees - $50,000

Hosting and Equipment - $150,000

Legal Fees - $100,000

MetaTrader4 - $80,000

Rent and Insurance - $80,000

Hotel & Travel - $30,000

Marketing - $100,000

Clearing lines - $250,000 (in deposits)

EXGATE


App1-MT4 EXGATE Technology Flow

LIQUIDITYMultiple Liquidity

Sources

BBO EngineBest Bid/Offer Order Matching

FIX Engine, WEB Server

MT4 FIX BRIDGE

FIX APILimit/Market Orders

EXGATE


App2- All-in-One MT4 Bitcoin Mobile Turn-Key

EASY WAY TO FUND TRADING ACCOUNT DIRECTLY FROM SMART PHONE

EXGATE


Safe Harbor

• Assumptions and forward-looking statements

• Some of the statements and information presented may contain projections or other forward-looking statements with respect to future events or the future financial performance of Exgate LTD. (the "Company") as defined by Section

• 27(a) of the Securities Act of 1933, as amended, and Section 21(e) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Sentences which incorporate words such as "believes," "intends," "expects," "predicts," "may," "will," "should," "contemplates," "anticipates," or similar statements are based upon management's current expectations or beliefs. These projections and forward-looking statements are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside of the Company's control, which could cause actual events to differ materially from those expressed or implied by our projections or forward-looking statements. The most important factors which could prevent the Company from achieving its stated goals include, but are not limited to, the following: (i) the current uncertainty in the global financial markets and the global economy, (ii) disruptions in the financial markets which could affect the Company's ability to obtain additional funding, (iii) public acceptance of our services, (iv) government regulations affecting financial markets, including, but not limited to, regulations with respect to the implementation of the JOBS Act, (v) our ability to grow our operations, (vi) our ability to penetrate markets, and (vii) our need for additional financing in order to fund our operations effectively. Additional factors include, but are not limited to, the Company's ability to do the following: (i) meet customer demands and generate acceptable margins, (ii) defend intellectual property and proprietary rights, (iii) adapt to rapid technological changes which lead to further competition, and (iv) attract and retain qualified management and personnel.