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Investments | 3 Months Ended
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Mar. 31, 2022
Schedule of Investments [Abstract] |
Investments | 7. Investments The following table sets forth the Company’s investments:
|  | March 31, 2022 |  |  | December 31, 2021 |
|  | Carrying Value |  |  | Cost |  |  | Carrying Value |  |  | Cost |
Securrency, Inc. – Series A convertible preferred stock |  | $ | 8,488 |  |  | $ | 8,112 |  |  | $ | 8,488 |  |  | $ | 8,112 |
Securrency, Inc. – Series B convertible preferred stock |  |  | 5,500 |  |  |  | 5,500 |  |  |  | 5,500 |  |  |  | 5,500 |
Subtotal – Securrency, Inc. |  | $ | 13,988 |  |  | $ | 13,612 |  |  | $ | 13,988 |  |  | $ | 13,612 |
Fnality International Limited – convertible note |  |  | 6,700 |  |  |  | 6,863 |  |  |  | — |  |  |  | — |
Onramp Invest, LLC – Simple Agreement for Future Equity |  |  | 250 |  |  |  | 250 |  |  |  | 250 |  |  |  | 250 |
|  |  | $20,938 |  |  |  | $20,725 |  |  |  | $14,238 |  |  |  | $13,862 |
Securrency, Inc. – Preferred Stock The Company owns approximately 22% (or 17% on a fully-diluted basis) of the capital stock of Securrency, Inc. (“Securrency”), a developer of institutional-grade blockchain-based financial and regulatory technology, issued as a result of strategic investments totaling $13,612. In consideration of such investments, the Company received 5,178,488 shares of Series A convertible preferred stock (“Series A Shares”) in December of 2019 and 2,004,665 shares of Series B convertible preferred stock (“Series B Shares”) in March of 2021. The Series B Shares contain a liquidation preference that is pari passu with shares of Series B-1 convertible preferred stock (which are substantially the same as the Series B Shares except that they have limited voting rights) and senior to that of the holders of the Series A Shares, which are senior to the holders of common stock. Otherwise, the Series A Shares and Series B Shares have substantially the same terms, are convertible into common stock at the option of the Company and contain various rights and protections including a non-cumulative 6.0% dividend, payable if and when declared by the board of directors of Securrency. In addition, the Series A Shares and Series B Shares (together with the Series B-1 convertible preferred stock) are separately redeemable, with respect to all of the shares outstanding of the applicable series of preferred stock (subject to certain regulatory restrictions of certain investors), for the original issue price thereof, plus all declared and unpaid dividends, upon approval by holders of at least 60% of the Series A Shares (at any time on or after December 31, 2029) and 90% of the Series B Shares (at any time on or after March 31, 2031). The investment is accounted for under the measurement alternative prescribed in ASC 321, as it does not have a readily determinable fair value and is not considered to be in-substance common stock. The investment is assessed for impairment and similar observable transactions on a quarterly basis. There was no impairment recognized during the three months ended March 31, 2022 based upon a qualitative assessment. On March 8, 2021, the Company recognized a gain of $237 on its Series A Shares, which was re-measured to fair value upon the issuance of Securrency’s Series B Shares. Fair value was determined using the backsolve method, a valuation approach that determines the value of shares for companies with complex capital structures based upon the price paid for shares recently issued. Fair value is allocated across the capital structure using the Black-Scholes option pricing model. The table below presents the inputs used in backsolve valuation approach (classified as Level 3 in the fair value hierarchy):
|  | Inputs |
|  | March 8, 2021 |
Expected volatility |  |  | 55 | %
Time to exit (in years) |  |  | 5.0 |
Fnality International Limited – Convertible Note In February 2022, the Company participated in a convertible note financing, making a £5,000 ($6,863) investment in Fnality International Limited (“Fnality”), a company incorporated in England and Wales and focused on creating a peer-to-peer digital wholesale settlement ecosystem comprised of a consortium of financial institutions , offering real time cross-border payments from a single pool of liquidity. In consideration for its investment, the Company was issued a 5% Convertible Unsecured Loan Note maturing on December 31, 2023. The note is convertible into equity shares in the event of a Qualified Financing Round (as defined in the note instrument) at a conversion price equal to the lower of (i) a discount of 20% to lowest price paid per equity share issued pursuant to such Qualified Financing Round and (ii) an amount paid per share subject to a pre-money valuation cap. The note is redeemable upon the occurrence of a Change of Control (as defined in the note instrument) provided that the amount repaid is the greater of (i) the principal amount and all accrued interest and (ii) the amount that would be received had the note been converted to equity shares immediately prior to the occurrence of the Change of Control. Redemption may also occur at maturity or prior to maturity upon approval by holders of at least 50% and 75%, respectively, of the outstanding notes. The note is accounted for at fair value. Fair value is determined by the Company using the probability-weighted expected return method (“PWERM”), a valuation approach that estimates the value of the note assuming various outcomes. The note is also remeasured for changes in the British pound and U.S. dollar exchange rate. During the three months ended March 31, 2022, the Company recognized a loss of $163 when re-measuring the notes to fair value. The table below presents the probability ascribed to potential outcomes used in the PWERM (classified as Level 3 in the fair value hierarchy):
|  | March 31, 2022 |
Conversion of note upon a Qualified Financing Round |  |  | 85 | %
Redemption of note upon a Change of Control |  |  | 10 | %
Default |  |  | 5 | %
Onramp Invest, LLC – Simple Agreement for Future Equity In June 2021, the Company invested $ 250 in Onramp Invest, LLC (“Onramp”), a technology company that provides access to cryptoassets for registered investment advisers. In consideration for its investment, the Company holds a Simple Agreement for Future Equity (“SAFE”), which provides the Company with the right to be issued certain shares of Onramp’s preferred stock in connection with Onramp’s future equity financing for preferred stock, at a 20 % discount to the price per share issued in connection with such equity financing, subject to a pre-determined valuation cap. The preferred stock is issuable upon the occurrence of such preferred equity financing, which would occur after Onramp’s conversion to a corporation. The investment is accounted for under the measurement alternative prescribed in ASU 2016-01, as it does not have a readily determinable fair value and is not considered to be in-substance common stock. The investment is assessed for impairment and similar observable transactions on a quarterly basis. There was no impairment recognized during the three months ended March 31, 2022 based upon a qualitative assessment.

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