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Are NFTs the Hottest Asset on the Block? Summary of the VMIL 5th Annual General Meeting held May 24, 2022
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Are NFTs the Hottest Asset on the Block?
Summary of the VMIL 5th Annual General Meeting held May 24, 2022
C O N T E N T S
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Market Update and Economic Overview
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Term to Know
What is an NFT? An NFT, or non-fungible token, is a digital asset that represents real-world objects like art, music, in-game items and videos. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.
Summary of the
VMIL 5 Annual General Meeting th
held May 24, 2022
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n May 24, 2022, VM Investments Limited (VMIL) invited its clients, shareholders, and team members to share in its fifth annual general meeting, held in a hybrid format. Shareholders were invited to participate with limited in-person attendance and via Zoom, Facebook and the VM Group YouTube channel. The event highlighted the accomplishments of VMIL to date and a review of the plans for the upcoming year. In attendance was approximately 70 persons, including meeting panel members Mr. Matthew Wright, acting Chairman; Mr. Courtney Campbell, VM Group President; Mrs. Janice McKenley, VM Group Chief Financial Officer and Mr. Rezworth Burchenson, VMIL CEO.
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Shareholders also voted and passed the following resolutions: Adoption of the Audited Financial Accounts for December 31, 2021, and the Reports of the Directors and Auditors. Declaration of an interim and final Dividend of $0.155. Retirement of Directors – Retirement and re-appointment of directors Mr. Michael McMorris, Mr. Matthew Wright, Mrs. Janice McKenley, and Ms. Bridget Lewis. Directors Remuneration Reappointment of KMPG, Chartered Accountants as Auditors In his address, CEO, Rezworth Burchenson identified several key initiatives including the VM Group brand transformation in November 2021 which saw new logos, brand colours and taglines being introduced across the business, signaling a renewed drive for excellence. VMIL also automated more of its processes with the launch of the Wealth IPO Edge platform which aims to improve the client experience and operational efficiency of the IPO application process. Approximately 84% of trade requests were executed digitally utilizing the J-Trader equity trading platform in 2021.
Expansion VMIL continued to expand its regional footprint by way of an agreement with Republic Bank to acquire a 100% stake ownership of Republic Funds Barbados. In his address, Mr. Burchenson stated that he expects the acquisition to further accelerate the growth of VMIL’s asset management arm.
Policies and Frameworks VMIL introduced and updated some key policies and frameworks. These
included policies set to improve the diversity and inclusion at the company as well as the ongoing implementation of a Group wide Diversity Policy, a mentorship framework geared at developing the VMIL senior leadership team and an approved Environmental Policy. VMIL presented its first Environmental Social & Governance (ESG) Report in its 2021 annual report and was the first company in the local market to produce an ESG report to its shareholders.
Credit Rating VMIL received an investment-grade credit rating of “CariBBB-” from Caribbean Credit Rating Services (CariCris). The CariBBB- rating was based on VMIL’s position as a competitive player in the local financial sector. VMIL was able to raise additional debt of $2.9 billion. These funds have since been utilized to accelerate the company’s lending efforts, coupled with improving its underwriting capabilities for corporate finance transactions.
Question & Answer Session During the Q&A segment, the panel fielded some probing questions. The panel was also asked if the expansion of new locations was deterred by the pandemic and the change in how people conduct business. VMIL’s expansion of branch locations was not deterred by the pandemic. Rather, VMIL has achieved its targeted number of locations. VMIL believes that through the expansion of its locations, it will be in a strategic position to assist its clients.
Are NFTs the hottest assets on the block?
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n the last year we have heard the term ‘NFT’ talked about across various sectors, mainly in the art and music industries. Let us delve deeper.
blockchain and another record of ownership, like a bank ledger, is that no one owns the blockchain. It’s decentralised and no one has authority to alter or destroy it.
NFT, short for non-fungible tokens, are digital representations of virtual or physical items that exist on the blockchain and have unique properties that cannot be traded for another. NFTs have a digital signature, which prove ownership and validity. An NFT is made possible by blockchain technology.
NFTs emerged in 2017 when American studio Larva Labs developed CryptoPunks, a series of 10,000 unique collectible characters with proof of ownership stored on the Ethereum Blockchain. The project was inspired by the modern CryptoArt. The CryptoPunks are one of the earliest examples of NFTs. The highest legitimate sale for a CryptoPunk was US$11.7 million.
In order to fully understand NFTs, we must first understand blockchain technology. The blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. It is essentially a digital ledger of transactions that are duplicated and distributed across a network of computers. The difference between the
Since 2017, several NFTs have been created, some by well-known personalities. The value of an NFT is usually created by the community that engages around it. The more engaging the project, the higher the likelihood of success. Community here refers to people in your circle
and the type of people that support your mission. This community is typically found on Twitter — your followers. Let’s take an artist that has a vast number of followers, you can gauge the outcome or success of an NFT based on the size of its creator’s following. The greater the following, the higher the probability the NFT will be successful. A few examples of items that can become NFTs are artwork, music, real estate, GIFs, and video snippets (for example, National Basketball Association top shots). Essentially, anything with a digital footprint is NFT eligible. Examples of actual NFTs are: Twitter CEO Jack Dorsey’s first tweet: “Just setting up my twitter.” in May 2006; this digital footprint was turned into an NFT and sold for US$2.9 million for charity. Digital artist Beeple created an NFT consisting of a collage of digital art, this was sold for US$69 million. Reggae-dancehall recording artiste Bay-C from T.O.K group sold the first reggae NFT for 0.1 Ethereum (ETH), which was equivalent to US$220. Other international recording artistes such as Akon, Snoop Dogg, Gorillaz, Calvin Harris, and Shontelle sold NFTs. Golden State Warriors star Steph Curry personally released a collection of 2,974 NFTs, each sold for US$333. Curry’s collection features digital replicas of his shoe line, Genesis Curry Flows, showcasing the exact pairs he wore for his incredible on-court features. Still not clear what a non-fungible token is? Try substituting the word fungible with replaceable. It will now read as a non-replaceable token, which means the item cannot be replaced; it is original or authentic. To illustrate, the $100 bill in your pocket can be replaced with two $50 bills or a combination of other notes. Your $100 bill is therefore fungible. Another example is the famous Mona Lisa painting for which there is only one verifiably original painting. Imagine having the original digital painting, aided by blockchain technology to establish its authenticity. While there are several images of the Mona Lisa painting on the Internet, they are just copies with lower value. The Mona Lisa NFT would have a unique digital identifier linked to the physical painting that
cannot be copied, substituted, or subdivided recorded on the blockchain, and that is used to certify its authenticity and ownership. This Mona Lisa NFT is non-fungible. To verify if someone owns an NFT, you simply cross-check the meta information with publicly accessible blockchain records. NFTs draw value from their inherent characteristics. Over time, the value accrues depending on the utility, community strength of the underlying project, and ownership history. NFTs are more than just owning a piece of art, they come with being part of a community where a culture has been created, and the culture creates a following. This encourages exclusivity, which comes with perks in owning the NFT. For example, the Bored Ape Yacht Club NFTs give you VIP access to exclusive parties in the real world. NFTs can be traded in a similar manner to traditional assets, like stocks and bonds. The NFT’s price appreciates in the secondary market based on its utility, scarcity, and strength of the community. There are a variety of marketplaces that support NFT trading, top of which include OpenSea, Rarible, SuperRare, and Foundation. Companies are also getting into the NFT space. Well-known brands, such as Nike, have made a foothold in the burgeoning NFT market by acquiring RTFKT, a creator-led organisation, specialising in digital fashion, which will be minting digital sneakers for the metaverse. Other well-known brands that have jumped on the NFT bandwagon are Adidas, Lamborghini, Coca-Cola, Louis Vuitton, Samsung, Pepsi, and McDonald’s. The line between the real world and the virtual space will become even more blurred as the virtual space continues to evolve and grow. Use cases for virtual products will become clearer and more useful to both virtual consumers, producers, and investors. To be ready to leverage existing and future opportunities to make money and build brands in the multiverse, you need to create virtual versions of your products and investors need to understand how to invest in digital assets. Look into whether NFTs are the way to go for you. They can maintain and enforce scarcity, exclusivity, and grow your income.
Market Update and Economic Overiew May 2022
Fixed Income During May, the Government of Jamaica (GOJ) reopened the GOJ FR 4.50% 2025 and GOJ FR 11.25% 2046. The FR 4.50% was undersubscribed as $1.82 billion was tendered for $2 billion on offer. On the other hand, the FR 11.25% 2046 was 1.46 times oversubscribed, as $2.19 billion chased $1.50 billion on offer.
Money Market Coming out of its meeting in May, the central bank’s Monetary Policy Committee hiked its overnight policy rate by 50-basis point, bringing the rate to 5.00%. Ahead of this rate increase, rates in the money market trended upward. The May auctions saw the yields on T-bills jumping to their highest since 2014. The 91, 182 and 273-day tenors gained 50, 11 and 453 basis points to end at 8.46%, 8.57% and 8.999% respectively.
Equities The Jamaica Stock Exchange (JSE) Main Market index declined by 7,445.81 points or 1.89% in May, from trading in 63 stocks of which, 23 advanced, and 40 declined. Wigton Windfarm Limited Ordinary Shares (WIG) was the volume leader with 43.38 million units traded, followed by TransJamaican Highway Limited (TJH) with 43.00 million units traded and Sagicor Select Funds Limited – Financial (SELECTF) with 28.13 million units traded.
Foreign Exchange At the end of May 2022, the JMD posted gains, having appreciated 0.07% month-over-month against the US dollar. According to the Bank of Jamaica’s (BOJ) Weighted Average Selling Rate (WASR), the local dollar gained $0.11 to end the month at $154.7429. The BOJ intervened in the foreign exchange (FX) market twice in May, through its Foreign Exchange Intervention and Trading Tool (B-FXITT), following a depreciating trend during the early part of the month.
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