KR1 Plc (NEXL:KR1) said the falling value of Bitcoin and Ether led it to swing to a wider first-half loss but remained confident on its prospects.
The NEX-listed blockchain investment group posted a pretax loss of £7.36mln in the six months to the end of June 2018.
READ: KR1 invests US$400,000 in disruptive blockchain technologies
“We’re currently in another downtrend, experiencing the same nervousness in the market as we did in the previous cycle, but instead of US$197 per Bitcoin the world watches on and winces at the current price of US$6,400,” CEO George McDonaugh said in a statement.
“The current trend has, as expected affected our portfolio. We’ve seen a loss due to the decrease in value of our cash equivalents Bitcoin and Ether. When combined with strong correlation between the price of these leading assets and the wider token market, the effects have been felt across most of our more niche token assets too,” he added.
However, the company said as it had chosen highly successful projects to invest in 2016 and 2017 and had drawn down on these at the right time, it had significant funds to allocate during the shift in market cycle and had been able to continue backing projects of the highest quality.
KR1 said that with blockchain innovation continuing at a rapid pace, it was excited about how its portfolio is taking shape. It added that it was confident that when a change in sentiment comes, it will be in a strong position to make the most of it.
“The market will undoubtedly consolidate at a ‘higher low’ in the near future as we will enter a new part of the adoption cycle. The difference this time is that we are seeing major moves into the space by some of the world’s largest financial institutions and because crypto assets are influenced by events and narratives, we see no reason why the market won’t catch up again as these institutions will allow greater access and spark a new wave of adoption,” he added.
Earlier this month KR1 splashed out US$400,000 (£307,500) on three investments in the blockchain sector in businesses looking to disrupt the radio beacon, internet and insurance markets. This followed a range of investments made by the firm in July in areas such as supercomputers and Internet of Things communications.
"Just as blockchain technology continues to thrive, our fundamentals as a company are also gaining momentum,” McDonough said, adding that KR1 is "excited for what 2019 will bring."