BIGG Digital Assets : MD&A 2021

MANAGEMENT DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31, 2021

This Administration Dialogue and Evaluation (“MD&A”) of BIGG Digital Belongings Inc. (the “Firm” or “BIGG“) gives evaluation of the Firm’s monetary outcomes for the 12 months ended December 31, 2021 and needs to be learn along side the

Firm’s audited consolidated monetary statements and the notes thereto for the 12 months ended December 31, 2021, which can be found on SEDAR atwww.sedar.com.

The December 31, 2021 monetary statements have been ready in accordance with Worldwide Monetary Reporting

Requirements (“IFRS”) as issued by the Worldwide Accounting Requirements Board. All quantities are expressed in Canadian {dollars}, except in any other case famous.

This MD&A is present as at April 29, 2022, the date of preparation, and contains sure statements that could be deemed “ahead–trying statements”. We direct buyers to the sections “Ahead-Wanting Statements” and “Danger and Uncertainties”

included inside this MD&A.

Extra data regarding BIGG is on the market on the SEDAR web site atwww.sedar.comand on the Firm’s web site atwww.biggdigitalassets.com.

NATURE OF BUSINESS

BIGG Digital Belongings Inc. is devoted to the digital property and blockchain expertise trade. It has two working enterprise segments: blockchain expertise growth and digital forex gross sales brokerage. BIGG manages the 2 enterprise segments and actions related to being a public firm.

The Firm‘s international blockchain search and analytics operations focus particularly on crypto investigations and managing monetary threat. With the exponential development of digital forex, the worldwide market should navigate elevated dangers and regulatory compliance. BIGG‘s mission is to carry digital forex mainstream – by offering belief and real-time threat analysis by way of its language agnostic proprietary platforms. The Firm affords enterprise, authorities and legislation enforcement shoppers a collection of forensic options, superior analytics and risk-scoring capabilities to satisfy safety wants and the expansion of the digital forex market.

On August 1, 2019, BIGG acquired Netcoins Inc., NTC Holdings Corp. and NTC Holdings USA Corp. (collectively known as “Netcoins”) in trade for 37,500,000 frequent shares issued from its treasury. Netcoins is within the enterprise of growing software program to make the acquisition and sale of digital forex simply accessible to the mass client and investor by way of brokerage companies. Netcoins permits crypto transactions a self-serve crypto buy portal and an Over-The-Counter (OTC) buying and selling desk. The enterprise of BIGG and Netcoins are extremely complementary, and this acquisition is predicted to create worth for shareholders in each the close to and long-term. It has supplied BIGG a possibility to step into the world of digital forex buying and selling, in an instantly operational capability.

BIGG Digital Belongings Inc. was integrated below the Enterprise Companies Act (British Columbia) on October 17, 2014 below the title Ameri-can Agri Co. Inc., which was subsequently modified to Acana Capital Corp. (“Acana”). On November 30, 2017, the Firm acquired Blockchain Expertise Group Inc. (“BTGI”) by way of a reverse acquisition transaction (“RTO” or “Transaction”) through the closing of a Share Change Settlement (the “SEA”) dated September 14, 2017. BTGI, now together with Netcoins, is the persevering with enterprise of the Firm.

On September 26, 2019, the Firm modified its title to BIGG Digital Belongings Inc. to raised mirror its deliberate future development and present companies.

At December 31, 2021, the Firm has $7,044,178 internet loss in the course of the 12 months and accrued deficit of $44,043,833 in the course of the 12 months. These consolidated monetary statements have been ready on a going concern foundation, which contemplates the belief of property and the cost of liabilities within the strange course of enterprise. The Firm continues to depend on financing by way of fairness raises or debt devices to assist its operations and expects to take action till the enterprise operates with enough money flows from operations Administration has decided that the Firm has ample sources to proceed as a going concern for the foreseeable future, which Administration has outlined as being at the least the following 12 months from December 31, 2021.

BUSINESS OVERVIEW

BIGG Digital Belongings Inc. believes the way forward for crypto is a protected, compliant, and controlled setting. BIGG invests in merchandise and corporations to assist this imaginative and prescient.

BTGI’s has developed a blockchain-agnostic search and analytics engine, QLUETM, enabling Legislation Enforcement, RegTech, Regulators and Authorities Businesses to visually observe, hint and monitor digital currencies transactions at a forensic stage. QLUETM permits Legislation Enforcement, RegTech, regulators and authorities businesses to actually “comply with the digital cash”. Investigators are in a position to rapidly and visually hint, observe and monitor transactions of their combat towards terrorist financing, human trafficking, drug trafficking, weapons trafficking, baby pornography, corruption, bribery, cash laundering, and different cyber crimes. Initially constructed round Bitcoin, BTGI has extra lately integrated Ethereum, Bitcoin Money, ERC20, and Litecoin.

Our product BitRank Verified® affords a “threat rating” for digital currencies, enabling RegTech, banks, ATMs, exchanges, and retailers to satisfy conventional regulatory/compliance necessities. Each make the most of the blockchain, which is essentially a digital ledger of transactions with distinctive traits designed to create information which might be safe, dependable, clear, and accessible. In late 2018, BTGI launched its Licensed Cryptocurrency Investigator (CCI) designation program (https://www.cryptoinvestigatortraining.com/) – the primary of its type. College students are taught how you can observe, hint and examine cryptocurrency transactions and/or crimes.

Netcoins, acquired in August 2019, expanded the Firm’s footprint within the digital property trade. Netcoins develops brokerage and trade software program to make the acquisition and sale of digital forex simply accessible to the mass client and investor with a give attention to compliance and security.

RESULTS OF OPERATIONS

The Firm is continuous to construct out its core companies – leading to better buyer traction and better on-boarding numbers.

The enterprise segments made important strides throughout 2021, with a give attention to excelling at delivering high quality services and products. The Firm seeks to satisfy the wants of shoppers right this moment, in addition to anticipating their future wants within the ever-changing panorama of the digital property trade.

2021 Highlights

BIGG:

•  Accomplished two prospectus fairness choices, with overallotments, to lift gross proceeds of $42,777,378

•  Added an extra 179.4 Bitcoin to its long-term treasury holdings, valued at roughly $4.16 million, or $70,100 per coin. BIGG intends to proceed to build up Bitcoin over time, because it believes a goal value of USD$100,000 per coin is achievable given the present lack of provide out there out there, sturdy on-chain metrics, and an more and more widespread curiosity in Bitcoin

•  Introduced the appointment of KPMG LLP because the Firm’s auditor. Along with being a pacesetter in audit, tax and advisory companies, KPMG has experience within the digital property sector and a global attain that may assist BIGG’s development initiatives

•  Made strategic fairness investments into LQwD (lqwdfintech.com) and TerraZero Applied sciences Inc. (“TerraZero”) (terrazero.com), additional rising its curiosity in TerraZero in early 2022. BIGG crystalized positive aspects of roughly $618,000 on disposal of 80% of its funding in WonderFi Applied sciences Inc., with the remaining curiosity offered in February 2022 (See “Subsequent Occasions” under). BIGG continued to carry a minor fairness ssoak up ZenLedger, Inc. (zenledger.io),

  acquired in July 2021.

Netcoins operations:

•  Commenced working as a Restricted Vendor below Canadian securities regulation – see “Netcoins‘ Restricted Vendor

  License” part under

•  Netcoins revenues grew strongly, rising 712% to $12,512,723 in 2021 (2020 – $1,540,395). The margin price elevated to 1.28% in 2021, up from 1.10% in 2020

•  Lively Customers totaled roughly 61,545 throughout 2021, up 639% year-over-year (YoY)

•  Launched its Android and Apple iOS native crypto buying and selling apps on the Google Play retailer and Apple Retailer

•  Launched further cash: ALGO, EOS, USDC and XLM

•  Tender launched Netcoins Pay, a pay as you go card that permits customers to attract from their Canadian greenback steadiness inside Netcoins, and earn Bitcoin again with each buy made. A choose group of testers comprise the primary cardholders, with further launches deliberate in 2022

•  Bought the area Netcoins.com

•  Continued to develop the group – together with the rent of Kim Dwyer as Chief Working Officer and Ankit Anne as Director of Technique & Operations, in addition to a VP of Finance and Assistant Controller

•  Continued to ramp up advertising throughout all channels, together with radio and tv

•  Continued its evaluation of licensing necessities for growth into the US

BTGI operations:

•  BTGI revenues elevated by 64% YoY, to $1,602,424 in 2021 (2020 – $974,134), at a margin price of 86% (2020 – 90%)

•  Continued efficiency enhancements have been made to BTGI’s merchandise

  •  launched the Ethereum ERC-20 explorer in our Compliance Suite, with highly effective filtering and visibility instruments

  •  launched a number of enhancements to our i-Graph (investigation graph), together with higher cluster visualization and high-definition export of graphs, and customized tackle and labelling instruments

  •  accomplished BTC, ETH, BCH, BSV and Syscoin assist on the i-Graph

  •  redesigned the Compliance Suite dashboard

  •  launched a case administration system in BitRank

  •  launched an enhanced BitRank API product that delivers new performance and permits entry to our in depth database to companions

•  Made important upgrades to our Deal with Watch:

  •  including three alert profile guidelines associated to Counterparty Danger Publicity and the monitoring of the danger rating of addresses within the group

  •  monitoring publicity of the person addresses or the group as an entire

  •  implementing APIs that allow consumer techniques to work together with our Deal with Watch, replace the addresses which might be being monitored, and obtain alerts

•  Continued efficiency enhancements have been made to BTGI’s merchandise, together with enhancements to permit for top-definition export

•  Continued enhancements made to our knowledge administration software program with an emphasis positioned on knowledge integrity and auditing

Netcoins’ Restricted Vendor License

BIGG strongly believes the way forward for crypto is a protected, compliant, and controlled setting.

On September 30, 2020, the Firm utilized for registration with the British Columbia Securities Fee (the “BCSC”) and different provincial and territorial securities regulators and the Canadian Securities Directors (the “CSA”) regulatory sandbox to permit Netcoins to function as a regulated open-loop crypto asset buying and selling platform.

On September 29, 2021, Netcoins obtained its registration as a restricted vendor within the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island, and Nova Scotia. Shortly thereafter, Netcoins was additionally registered in Newfoundland.

BIGG continues to be on the forefront of regulation within the Canadian crypto area and, notably, is the primary publicly traded firm within the nation to personal and function a registered crypto buying and selling platform. This marks a big milestone for BIGG, Netcoins, and the crypto buying and selling trade, with a brand new regulatory regime for an rising trade that’s rising exponentially.

Netcoins is now one of many first crypto buying and selling platforms (CTPs) to be registered as a restricted vendor in Canada, which is able to present a definite early mover benefit because the trade continues to mature and evolve right into a regulated framework. Underneaththis framework, Netcoins will proceed to function and market to new clients throughout Canada, together with Ontario. Netcoins anticipates continued development on its platform by way of:

•  the addition of recent cash

•  further launches of Netcoins Pay and different new merchandise

•  growth into the US, and

•  increasing promoting campaigns to new channels to achieve new audiences.

Custody and Safeguarding of Digital Currencies

Netcoins has made safeguarding and custody of buyer property a precedence, and has devoted important time and sources to evaluating third-party custody suppliers to make sure the answer supplied by way of Netcoins gives probably the most integrity and safety to its clients. Netcoins doesn’t keep custody of (or in any other case maintain) crypto property owned by clients.

Netcoins makes use of BitGo Belief Firm, Inc. (“BitGo”) as its main custodian.

On March 24, 2022, Netcoins acquired an replace to its restricted vendor license with the BCSC and CSA that allows the corporate to carry as much as 20% of its whole consumer crypto property on-line in sizzling wallets secured by Fireblocks Ltd. (“Fireblocks”).

A abstract of every custodian is supplied under.

BitGo Belief Firm, Inc.

BitGo Belief Firm, Inc. acts because the third-party custodian for buyer crypto property (together with offering chilly pockets custodian companies). BitGo is liable for holding and safeguarding these crypto property. BitGo doesn’t act as a cost processor in reference to their custodian service preparations with Netcoins.

BitGo is a belief firm organized below the legal guidelines of the State of South Dakota and controlled as a belief firm by the Division of Banking in South Dakota. BitGo has not appointed any sub-custodian to carry any of the crypto property. All the Firm’s lengthy-term Bitcoin funding holdings are additionally held in chilly storage with BitGo.

BitGo gives insured pockets administration and custody options for a wide range of digital property, sustaining a complete insurance coverage coverage for digital property masking $100 million in losses for crypto property held in chilly storage and in sizzling wallets, together with the property owned by Netcoins’ clients. BitGo is just not liable for any losses ensuing from inaccurate

directions and the Firm is liable for sustaining ample safety and management of any and all keys, IDs, passwords, hints, private identification numbers, non-custodial pockets keys, API keys, yubikeys, 2-factor authentication units or backups, or every other codes that the Firm makes use of to entry BitGo. Moreover, BitGo is just not liable for any injury or interruptions attributable to any pc viruses, spyware and adware, scareware, Trojan horses, worms or different malware which will have an effect on the Firm’s pc or different tools, or any phishing, spoofing or different assault, except such damage or interruption straight resulted from BitGo’s gross negligence, fraud, or willful misconduct. There are not any limitations on legal responsibility if BitGo breaches its confidentiality obligations or if any injury or interruptions straight outcome from BitGo’s gross negligence, fraud,

or willful misconduct. All different damages are restricted to the charges paid to BitGo inside the twelve-month interval previous the incident giving rise to such legal responsibility.

The due diligence course of for BitGo included the next:

•  Overview of BitGo Inc.‘s (which licenses expertise to BitGo Belief Firm, Inc.) SOC 2 Kind 2 report and certification

  (System and Group Controls Report Related to Safety performed by Deloitte for the durations from December 1, 2019 to September 30, 2020 and October 1, 2020 to September 30, 2021, with a bridge letter obtained for the interval of October 1, 2021 to December 31, 2021).

•  Overview of BitGo Belief Firm’s SOC 1 Kind 2 report and certification for the interval of April 1, 2021 to September 30, 2021.

•  Overview of BitGo’s complete insurance coverage coverage for digital property which at the moment covers $100 million in losses for funds held in chilly storage, features a set of company insurance coverage insurance policies, and elective sizzling pockets insurance coverage.

•  Affirmation that BitGo will maintain all crypto property in belief for patrons of Netcoins in an omnibus account within the title of Netcoins, and separate and distinct from the property of Netcoins and all of BitGo’s different shoppers.

•  Overview of BitGo techniques that let Netcoins to generate a novel tackle for every buyer account so it could observe who despatched the funds in, and which account to credit score. When a buyer sends funds, it creates a brand new BitGo sub-account, which feeds into one fundamental account which is within the title of Netcoins. As soon as a buyer account is funded with the related crypto asset, BitGo custodies the crypto asset. BitGo makes use of 100% multi-signature expertise to take away single factors of failure, person and pockets controls to determine and implement inner insurance policies and procedures, and two-factor authentication for all accounts.

•  Overview of BitGo’s insurance policies and procedures which it has established and utilized that handle and mitigate the custodial dangers, together with, however not restricted to, an efficient system of controls and supervision to safeguard the crypto property for which it acts as custodian.

•  Affirmation that BitGo has an impartial inner audit carried out by Eide Bailly LLP, a public accounting agency.

Netcoins has performed due diligence on BitGo and has not recognized any materials issues. The Firm is just not conscious of something close to BitGo’s operations that might adversely have an effect on the Firm’s capacity to acquire an unqualified audit opinion on its audited monetary statements. The Firm is just not conscious of any safety breaches or different related incidents involving BitGo on account of which crypto property have been misplaced or stolen. There are not any restrictions on the Firm’s capacity to maneuver crypto property from the custodianship of BitGo, and these transfers can happen instantly, topic to the management processes, corresponding to two video conferences to authorize chilly storage transfers.

Netcoins has assessed the dangers and advantages of utilizing BitGo and has decided that compared to a Canadian custodian it’s extra helpful to make use of BitGo, a U.S. custodian, to carry consumer property than utilizing a Canadian custodian, as there may be not an acceptable Canadian custodian choice right now.

Along with the preliminary due diligence on BitGo, Netcoins continues to conduct ongoing due diligence on BitGo. As a part of an annual evaluation, Netcoins would require BitGo to:

•  present copies of any accomplished SOC stories and reviewing similar for any improve threat to Netcoins;

•  affirm from BitGo that it maintains ample insurance coverage protection;

•  confirm the quantity of BitGo’s fairness and different monetary metrics to deal with counterparty risok; and

•  confirm that BitGo maintains any requisite licenses together with licenses issued by the Division of Banking in South Dakota or every other regulator.

The Firm at the moment makes use of each cold and warm pockets techniques inside BitGo.

•  The chilly pockets is totally segregated, is just not linked to the web and is used for long run storage of crypto property. The chilly pockets requires two of 4 approved signatories, as representatives of the Firm, to confirm any transfers from the chilly pockets through video convention.

•  The recent pockets is linked by way of the web, is linked to the Netcoins internet software through API and all buyer deposits and withdrawals are processed by way of the new pockets. As thresholds are met, transfers are reviewed and signed manually by considered one of 4 approved signatories. The related thresholds embody limits of 4 BTC per transaction, 30 BTC per hour, or 100 BTC per day.

Fireblocks Ltd.

Fireblocks is a developer of a blockchain safety platform designed to guard digital property. The platform securely transfers property throughout exchanges, wallets, custodians, and counterparties and retains them available utilizing Fireblocks‘ patent-pending chip isolation safety, and mannequin predictive management (MPC) expertise, enabling merchants to safeguard digital property.

Fireblocks Ltd. is integrated below the legal guidelines of Tel Aviv, Israel, and has obtained a SOC 2 Kind 2 audit report ready by the auditors of Fireblocks, a number one international audit agency. Netcoins has reviewed a duplicate of the SOC 2 Kind 2 report for the interval of September 1, 2020 to August 31, 2021, with a bridge letter obtained for the interval of September 1, 2021 to December 31, 2021 and has not recognized any materials issues.