FAQ

1. What is Zirconium Dioxide?

Zirconium dioxide (ZrO2) takes the form of colorless crystals with a fusion temperature of 2,715°C. It has one of the highest melting points of all metal oxides. Zirconium dioxide is one of the most highly in-demand zirconium compounds in the industry. Naturally it occurs as brazilite or zirconium dioxide, a white powdered crystal of a grey or yellow shade. It can be produced using an iodide refining method, where simple metal zircon shavings are used as raw materials. Zirconium dioxide is used to produce ceramics, including in prostheses, illumination and refractories, as well as in the manufacture of glass furnaces, etc.

2. Are there any cheaper analogues available on the market?

Everything is quite simple here. The key indicator of zirconium concentrate is the percentage of the main component – zirconium dioxide (ZrO2). The manufacturers producing natural concentrate are cunning in stating that their natural zirconium concentrate contains 65-66% zirconium dioxide. They get this figure by adding the quantities of zirconium dioxide (ZrO2) and hafnium oxide (HfO2). If we apply the same formula for our synthetic concentrate of zirconium, we can say that our concentrate has 70% of zirconium dioxide (ZrO2), as it contains 67.6% of zirconium dioxide and 2.77% of hafnium oxide. The information is proved by the opinion of ‘MISiS’ National University of Science and Technology. Our material also features superior physical properties, as we make it from wastes that have gone through temperature processing. Moreover, our zirconium concentrate is not radioactive, unlike the natural one.

3. What is the demand for the material?

Annual demand in Russia is approximately 150,000 tons, which is almost entirely imported.

4. How much money do you need to build a factory?

We would like to attract not less than 3.5 million US dollars, which should be enough to launch the project.

5. Why not to go to the bank?

It is a venture project and as the banks try to minimize their risks, they prefer loans. Those banks that do engage in such projects require a majority stake in the company. We are using an innovative technology and can provoke interest among competitors, and the equipment is of key value. There is an opportunity to further both the enterprise and the technology. But this is not really the point. In my opinion, this is the time for new financial as well as industrial technologies. This is an interesting project that leverages both.

6. Who can become an investor?

The central idea is to begin crowdfunding, meaning everyone can become an investor. The main thing here is the convenience and transparency of the investment process.

7. Why did you select the Waves Platform for the ICO?

The main thing I like about the Waves platform is that it allows users to generate tokens easily. The platform can be used to pay dividends on each token. Moreover, it has been designed in Russia and I think it has great developmental potential.

8. Can investors feel safe?

We give a digital token to every investor, which is an electronic asset worth of a kilogram of zirconium dioxide. This asset is backed by the commodity. More accurately, it is an option that is sold at a discount. I think this is the future of exchange trade: options contracts for raw materials and other products on the blockchain. Each investor is provided with an option. The investment is made in the form of funds loaned to the Russian company by a foreign fund, and the investor becomes a shareholder in the Russian company. The loan is used to get the invested funds back and to gain investment income. That is why all assets are encumbered, meaning the equipment, etc. Therefore, every owner of the digital token is safe. If the token holders are ready to disclose their personal information, the fund may provide guaranteeing and supporting documents. The company will undergo an annual audit and all financial statements will be available online. CCTV will be installed in the factory and any user or investor will be able to watch the process live. If someone is displeased and wants to quit, he/she is free to do so at any time.

9. Why do you use a foreign investment fund?

It is prohibited to sell cryptocurrencies in Russia. As investments are made in cryptocurrency, such as bitcoin, Ethereum and others, they will be received and sold overseas. The money is credited to the USD account of the Investment Fund, and afterwards is transferred to the account of our company in Russia under the loan contract. The Investment Fund is registered in Cyprus. The Cypriot Fund will hold a 49% stake in the company, while other shares will be distributed among the shareholders.

10. What is the period of return on investment?

I think that total return on investment will take 1.5 years. After the ICO, which will last for about a month and will be in April, and in the event it is successful, we will begin with the project. We will purchase the land in the industrial area of Magnitogorsk and will immediately launch the construction process. It is possible to build the factory in seven months, of which three months are required to erect the building of the workshop and six months to produce and install necessary equipment. These processes will overlap. Commissioning might take another month. The manufacture of zirconium dioxide is expected to start in December. After the factory is launched we will begin to buy our tokens back using our profits. The repurchase price of the tokens will include the investment income on the Project. The repurchasing period will last for 12 months.

11. What is your plan if you fail to collect the necessary amount during the ICO?

If we fail to collect enough, we will return all funds. The minimum amount needed for the project is 3,500,000 US dollars.

12. What is the estimated volume of production?

We will produce 400 tons per month, which is not a large volume of zirconium concentrate. Nowadays it is only one tenth or even one hundredth of the amount that can be consumed by Russian industry. We already have customers who are ready to buy our product, and not only in Russia. The material to be produced has provoked interest among German manufacturers. The demand for our product exceeds manufacturing capacity. We do not see any problem with sales. We will follow the market principle: the one who pays more gets the product.

13. What is this technology about?

We will produce zirconium concentrate out of the scrap of zirconium-containing refractories, which are waste products created by every glass-making factory, as well as for mineral and glass cotton factories. Nowadays, there is no problem with acquiring these wastes as they do not pose any interest for the industry. With the help of our technology scrap firebricks, which initially contain zirconium dioxide, will be processed. That is how our synthetic zirconium dioxide (ZrO2>66%) will be produced, in form of powder. Our advanced and low cost technology leads us to believe that the project will be a success.

14. Why did you choose to resort to such an unusual fundraising method?

I think that blockchain technology is safe and transparent for users. Each user can see what is sold and what is purchased. The income goes to a separate e-wallet. It allows for real-time monitoring of transactions.

15. What makes your synthetic concentrate of zirconium better than its analogues?

1) The given zirconium concentrate is a synthetic material and has undisputable advantages over the natural zirconium concentrates present in the market! The minerals (namely zircon and brazilite) are stabilized in the given concentrate and are not susceptible to phase transitions.

2) The presence of corundum (Al2O3) in our concentrate does not let the silicon oxide (SiO2), which is a component of zircon, form low-melt compounds when the dissociation temperature is reached, as it immediately forms mullite (2Al2O3SiO2), which is a refractory material. Softening temperature of the products made of synthetic concentrate (one of the key parameters) is over 1750°C, which means that since the working temperature of glass furnaces is 1600°C, the products are not susceptible to erosion.

3) The presence of brazilite makes the chemical durability of the product up to three times greater than its analogues!

4) The synthetic concentrate is a ready-made furnace charge to produce both fusion-cast and molding items. It does not require any additional components (batching) and therefore a complex, power-consuming and technically-demanding conversion is not required.

5) The performance of the products made of synthetic concentrate of zirconium may be compared to that of much more expensive ones:

A. high-chromium;

B. chromium-aluminum-zircon;

C. chromium-corundum.

In our preliminary talks the technicians and managers of refractory enterprises have confirmed their readiness to use synthetic zirconium concentrate in their manufacturing processes.

16. Why don’t you find an investor and earn billions with such a perspective technology then trying to raise these scanty 3500000$ online?

It isn’t about the investors, but for one factor. Our project is actually a venture for a potential investor. Investors in Russia demand a majority stake in the Company (51%-80%). Therefore, in fact we sell the technology and the investor becomes its beneficial owner. That is why we have decided to turn to the crowd investments with the blockchain, this will allow us maintaining the ownership title and sharing only a part of the profit with the investors. The amount to be raised is not large, but sufficient to launch the manufacturing process. Should we raise more, we will just expand the manufacturing capacities. As you know that currently the number of those willing to buy our products is twice bigger than the design performance.

17. They write to us and say that 'We have spoken to some refractory experts and they say it is impossible'.

Until now not a single expert who makes such claims has had guts to introduce himself/herself. Who are they? We do not know them either, but we are ready for any form of dialogue. But yet let me answer this question. We have an expert opinion for our material prepared by ‘MISiS’ National University of Science and Technology and Ural Federal University named after the first President of Russia B.N. Yeltsin (Institute of New Materials and Technologies).

We also sent our products to the Germans (Viktoria Garten Huttenindustriebedarf AG (VGH)) for analysis. The Germans were surprised with the quality of our zirconium concentrate and when they were told that it was made of the industrial waste they got into raptures. And at the Metal Expo 2016 held in Moscow on November 8-11, 2016 they confirmed their willingness to buy our products.

RHI Company , the world’s leader in capitalization ratings, also showed its interest in our products at the Metal Expo 2016.

18. The founders of Zircon Ltd are also top-managers in other companies and have large businesses, could they find strength to be in this project?

To my mind, it is ridiculous. What we do is not just a job, it’s a hobby. Indeed, every founder has his/her own business, and we have made a great progress, everyone in his/her own area. It is our vast experience and joint efforts, which will let us say for sure that we will put this project into life. It is not our first joint project. We are involved in implementation of new industrial technologies. In 2017 our team decided to combine our innovative industrial developments with new financial technologies in the investment area. This project is the synergy of our experience and skills as it embodies new technological solutions both in industrial and economic areas.

19. And how are you going to pay the investments back to the foreign company? Is there any sort of mechanism?

The mechanism is very simple. When the ICO is over, the funds are accumulated at the foreign investment account of ‘Lagata’ Company. Afterwards Lagata and Zircon Ltd enter into the interest loan agreement, under which Zircon Ltd receives funds. When the factory is built and the products are being sold, Zircon Ltd will repay the loan to Lagata under the aforementioned agreement.

20. They write to us and say that ‘Your investment agreement is quite tangled’.

Currently, the ICO (initial coin offering) is in the so-called ‘shadow’ legal axis as many countries nowadays practically have no regulations covering call for investments through the ICO. ICO organizers willing to legalize the process have to link the sale of digital tokens to commodities, for instance, to sale of digital products or software. In our case there is a certain link to the commodity (synthetic dioxide of zirconium). Regulations covering call for investments may be changed at any time that is why the organizers reserve the right to amend the agreement to avoid needless problems and perform their obligations to the investors. Look at the terms of investments of iconomi and chronobank projects and you will realize that we have not invented anything new, we even guarantee more.

21. You write that you can amend the agreement at any time. Should I monitor you website 24/7 to keep up with the amendments?

You are free to do so, but it is not necessary. In accordance with paragraph 12 of our agreement we will notify you of any amendments via e-mail.

12. Notices

12.1 We may provide any notice to you under this Agreement by: (i) posting a notice on the website; or (ii) sending an email to the email address then associated with your account. Notices we provide by posting on the website will be effective upon posting and notices we provide by email will be effective when we send the email. It is your responsibility to keep your email address current. You will be deemed to have received any email sent to the email address then associated with your account when we send the email, whether or not you actually receive or read the email.

22. What am I supposed to do if I do not agree with your investment terms or amendments thereto?

If you disagree with our investment terms or amendments thereto, you can always discuss them or enter into the agreement, which suits you, in accordance with paragraph 15.11 of our agreement.

15.11 These terms are not boilerplate. If you disagree with any of them, believe that any should not apply to you, or wish to negotiate these terms, please contact ZrCoin.io via e-mail and immediately navigate away from the website. Do not use the website and/or products offered thereto until you and ZrCoin.io have agreed upon new terms of use. We are always open to any dialogue and try to work to the benefit of the society, as the success of our project depends on you.

23. Why have you chosen Moscow Arbitrage?

All assets and contractors under the project will be located in Russia, and in case of any disputes it is much easier and faster to resolve them on the territory where the assets and people are located.

24. Does the material have any analogues?

We will use the material to register our own trademark, as there are no analogues.

25. How can you prove that the material features the claimed properties?

The developers of the technology are V. Merzlyakov, Y. Panov and V. Kochetkov. The technology is the result of a great number of experiments and there are no analogues in the world. Currently there is expert backing from ‘MISiS’ National University of Science and Technology conducted by ‘Tseolit’ Research and Development Centre, where V. Merzlyakov is the CEO. Ural Federal University and the Institute of New Technologies have provided results of analysis of the material constitution of zirconium-containing material. Copies of their reports are available on the website.

26. Can you name the enterprises who are interested in purchasing your synthetic concentrate and at what price?

We have designated the preliminary cost of this concentrate equal to approximately 2,800 USD per ton. The preliminary declared consumption quantity of our product exceeds 1,000 tons per month.

Enterprises:

1. RHI (Russia)

2. VGH (Victoria Garten – Russia, Germany)

3. Magnesit Group, JSC (АО) (Satka)

4. Dinur, OJSC (ОАО) (Pervouralsk, Russia)

5. Bacor, Research and Development Centre (Shcherbinka, Russia)

6. PK-2, CJSC (Podolsk, Russia)

27. What the economic sense in raising money online when you have such a perspective technology? Why don’t you loan funds from the bank or relevant investor?

I will answer this question step by step.

First of all, when Russian banks loan funds they demand pledge, which raises the amount of loan by 200%, i.e. if you want a 3,500,000$ loan, you have to provide a property pledge worth of more than 7,000,000$. This is not an option for us.

Secondly, when you turn to the relevant investor, you tell him/her that you have a project, technology and expert opinions, generally, everything except for the money. Investor tells you ‘Ok, this is a feasible project and I’m ready to invest’. But there is a material condition, because the investor wants 80% stake in the Company, leaving for us only 20%. Therefore, we simply hand over the perspective technology to this investor.

And thirdly, if the investor offers us 20%, while 80% goes to this investor, why don’t we resort to the crowd investments to avoid needless shareholder in the company’s structure and offer the gained profit (80%) as a payback on investment? Given that, if the planned profit is 1,200,000$, 80% is equal to 960,000$.

Estimated model of payback on investment

	Start	Sale of products
Month	8	9	10	11	12	13	14	15	16	17	18
Token repurchase volume, $ thousand	400	500	600	600	700	700	700	700	700	700	700
	7,000,000$

Summarizing the results, we see that with the crowd investments we kill two birds with one stone as it has an economic sense and allow us keeping the beneficial ownership in the technology, which is the most important for us!

28. They write to us and say that ‘I talked to an expert, and he told me that ZrO₂/HfO₂ + Аl₂O₃ + ЅіO₂ formula is not bad, but if it had other properties, it could be widely used’.

We are going to produce synthetic concentrate of zirconium. It is mainly used in production of zirconium refractories.

Here is the opinion prepared by professor V.A. Perepelitsyn. Our material was tested in the Ural Federal University named after the first President of Russia B.N. Yeltsin ‘Institute of New Materials’.

The opinion describes the areas of use of our zirconium concentrate:

- manufacture of Bacor items of БК-37 and БК-41 grade

- production of zircon-containing kaolin fibre

- using as non-stick coating in foundry

- manufacture of enamels and glazes for metals and ceramics.