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Shares in blockchain technology firm, Catenae Innovation [LON:CTEA] more than doubled on the recent news that the firm has been invited to take part in the development of the UK Government’s ‘Digital Identity Policy’ – on 22 February Catenae’s share price rose from 1.94 to 3.30, subsequently rising to 4.29 on 23 February 2021.

The Digital Identity Policy is part of the Government’s wider plan to make it quicker and easier for people to verify themselves using technology such as blockchain. The aim is to create a process as trusted as using passports or bank statements.

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Catenae Innovation will participate in a series of consultations with key stakeholders over the next six months and will advise on how organisations should handle and protect people’s data. The invitation is good news for Catenae which has recently been rolling out COV-ID, a Covid-19 testing platform, as it provides the company with recognition as a credible supplier of digital identification solutions.

Catenae has not yet lived up to its true potential

The Catenae Innovation share price has since settled back to 3.48, at time of writing. However, it hasn’t been all plain sailing. In the last year the share price has ranged from 0.34 to 7.10, and as we covered in June 2020, Catenae has not performed as well as expected even with their Covid-19 testing certification solution.

In January, the share price dipped when Catenae announced a £1 million capital raising. This was the second fundraiser in just over six months. The firm issued 52.4 million new ordinary shares in order to “enhance its proprietary technology capabilities, build upon its business development strategy and for general working capital purposes,” according to a statement. The firm converted £13,000 of remuneration liabilities to some directors into 650,000 new ordinary shares. There was also the settlement of other current liabilities of the company, amounting to £35,000 into 1.75 million ordinary shares. The placing and conversion were priced at 2p per share.

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Plus, there are still no signs of a profit. At the last count which was for the six months ended 31 March 2020, the company recorded revenue of just under £20,000 and a comprehensive loss of £364,000.

Could 2021 be a good year for Catenae Innovation?

But despite the numbers, it looks as if the firm might be turning a corner. Late last year Catenae formed a joint venture with BHA Medical to roll out a Covid-19 testing platform. While BHA Medical supplies the testing kits, COV-ID – Catenae’s blockchain-powered Covid-19 testing platform using secure data management platforms and digital passport apps – records and feeds results into Public Health England’s database for use by the NHS’ Test and Trace service.

So far 18 pharmacies, a major UK mobile operator and Badminton England have implemented Catenae’s COV-ID system. A Fortune 500 American construction company listed on the New York Stock Exchange has also just begun piloting the company’s Covid-19 testing platform across certain areas of its UK division.

Alongside this, Catenae has received ISO 27001 and Cyber Essentials accreditations which officially prove their commitment to ensuring data protection and GDPR compliance. With so much groundwork done, and the after effects of Covid-19 set to run and run, we would expect to see Catenae Innovation stock back on track again.

How COV-ID works:

  • A user has Covid-19 antigen/antibody test/retest, then the Validated ID & test result are written to the blockchain and uploaded onto the app.
  • The user approaches a location or security entrance.
  • The user opens the COV- I D App on their smartphone.
  • Guard/Access Control System scans QRcode using device/scanner, opening link to digital wallet.
  • Guard/Access Control System checks ID and certificate, then confirms admission or refusal.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Philippa Aylmer

Philippa Aylmer

Philippa Aylmer is a freelance writer within the investment management sector.

She began her career in the late 90s writing about emerging markets for the Euromoney titles while based in Pakistan. Since then, she has covered hedge funds, ETFs, wealth management and fintech.

As well as news, on the client side, Philippa advises on media relations and editorial strategy, writing about the topical and technical issues of investment management

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A date for your diary

On the 21st of October, Stuart Fieldhouse will be joining Sarah Lowther and Mark Watson-Mitchell to discuss which small cap investments they like the look of and, perhaps, which ones they do not. It promises to be a lively and insightful discussion. If you are interested in investing in small cap stocks then this could be a profitable use of your time. We hope you can make it! Sign up now

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