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@DingoBoratI have read all of your posts on the DTC and you have covered the field extremely well. There is absolutely no doubt that the Brainchip shares on issue will remain exactly the same and that these limited share numbers will now be available much more easily to institutional and retail investors from around the globe. In what is likely my last post on this forum for some time due to a complete lack of trust in how it operates and as I am not allowed to post unsubstantiated material from Brainchip I will once again engage in the fantasy of imagining what response I would receive if I asked the Chief Financial Officer for an explanation of the DTC announcement and its significance:
This one was something we put a ton of work into months ago and then Covid killed the DTC! Our application sat there literally for months which was very upsetting and disappointing considering the amount of work and the cost that went into it. But finally it has happened.
There are a few websites that actually explain it all very well but if I were to put it into simple terms, I would explain it as follows:
When our shares are traded on the OTCQX, the settling and clearing process is happening on the ASX because we had no access to the automated, electronic, clearinghouse system in the US. Because of this, the number of firms/institutions that could access our shares was very limited and the transaction fees were very expensive. Many of these firms can only deal in the securities of DTC members.
By joining DTC and having the ability to settle and clear locally in USD, and by having a local US based transfer agent (or registry as it’s called there), and without the need to settle and clear on the ASX (CHESS), all DTC member firms and institutions now have easy access to our shares. Previously, if you were to purchase the BRCHF shares, you would likely see an additional fee of up to $55 (USD) tacked on to the cost of your trade to cover the costs of administering these trades. That is no longer the case.
I tested it today and noted that the fee to trade was $6.95/trade. With the increase in the number of eligible firms having access to our shares combined with a dramatic decline in transaction fees, we should see increased demand for the shares. It’s all aimed at increasing our exposure in the US. The more places our name pops up, the better!
Last but not least, DTC eligibility is a requirement of all the major exchanges in the US. If the company were to pursue a duel listing at some point in the future, this would be another step in the right direction although the ADR is the perfect instrument for that already.This of course is simply my take on what the CFO would say if he were asked so treat it as my opinion and DYOR - you could for example refer it to Brainchip for comment to see how close to the mark I am.
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AKIDA BALLISTA
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