10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
	OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2018

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
	OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number 814-00175

TimefireVR Inc.

(Exact name of Registrant as specified in its charter)

Nevada	86-0490034
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)
7150 E. Camelback Rd. Suite 444
Scottsdale, AZ	85251
(Address of principal executive offices)	(Zip Code)

(602)-617-8888

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). 

Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ☐	Accelerated filer  ☐
Non-accelerated filer ☐	Smaller reporting company   ☑
Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). 

Yes ☐ No ☑

As of August 14, 2018, there were 235,460,470 shares of the registrant’s $0.001 par value common stock issued and outstanding.

 INDEX TO FORM 10-Q

PART I.	FINANCIAL INFORMATION	Page
Item 1.	Consolidated Financial Statements:	3
	Unaudited Balance Sheet as of June 30, 2018 and Audited Balance Sheet as of December 31, 2017	3
	Unaudited Statements of Operations for the Three and Six Months Ended June 30, 2018 and 2017	4
	Unaudited Statements of Cash Flows for the Six Months Ended June 30, 2018 and 2017	5
	Notes to Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	15
Item 4.	Controls and Procedures	15

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	16
Item 1A.	Risk Factors	16
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	16
Item 3.	Defaults Upon Senior Securities	16
Item 4.	Mine Safety Disclosures	16
Item 5.	Other Information	16
Item 6.	Exhibits	17
SIGNATURES		18

PART I - FINANCIAL INFORMATION

ITEM  1. FINANCIAL STATEMENTS

TIMEFIREVR INC.
BALANCE SHEETS
		June 30,			December 31,
		2018			2017
		(Unaudited)
ASSETS
Current Assets:
Cash	$	185,063		$	559,237
Cryptocurrencies		53,418			—
Note receivable		120,000			—
Interest receivable		3,600			—
Accounts receivable		280			38
Prepaid expenses and other current assets		207,247			131,250
Total current assets		569,608			690,525
Other Assets:
Property and equipment, net		307,171			26,128
Deposit		459,648			33,500
Total Assets	$	1,336,427		$	750,153
LIABILITIES AND SHAREHOLDERS' EQUITY/(DEFICIT)
Current Liabilities:
Accounts payable and accrued expenses	$	49,883		$	349,469
Demand obligation payable - related party		—			116,883
Convertible notes payable, net		1,789,152			1,564,814
Accrued interest		292,575			321,824
Short-term advance - related party		—			57,400
Total current liabilities		2,131,610			2,410,390
Long Term Liabilities:
Derivative liabilities		231,176			198,994
Total long term liabilities		231,176			198,994
Total liabilities		2,362,786			2,609,384
Commitments and Contingencies		—			—
Mezzanine Equity
Preferred Series A stock, par value $.01 per share, 134,000 shares authorized; 0 and 133,334 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively. Stated at redemption value.		—			1,500,004
Shareholders' Deficit:
Preferred Stock, par value $.01, 10,000,000 shares authorized all series:
Preferred Series A-1 stock, par value $.01 per share, 21,000 shares authorized; 0 and 14,923 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		—			149
Preferred Series B stock, par value $.01 per share, 300,000 shares authorized; no shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		—			—
Preferred Series C stock, par value $.01 per share, 0 and 502 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		—			5
Preferred Series E stock, par value $.01 per share, 129,190 and 0 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		1,292			—
Obligation to issue common stock		1,000			—
Common stock, par value $.001 per share, 500,000,000 shares authorized; 228,460,470 and 47,269,804 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		228,461			47,270
Additional paid-in capital		2,413,441			(666,101	)
Accumulated deficit		(3,670,553	)		(2,740,558	)
Total shareholders' deficit		(1,026,359	)		(3,359,235	)
Total Liabilities and Shareholders' Deficit	$	1,336,427		$	750,153
The accompanying notes are an integral part of these unaudited financial statements.

3

TIMEFIREVR INC.
STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Revenues	$	8,917		$	—		$	8,917		$	—
Cost of sales		56,003			—			56,871			—
Gross profit		(47,086	)		—			(47,954	)		—
Operating expenses:
Occupancy		2,283			—			5,378			—
Officer compensation		130,389			—			406,879			141,195
Professional fees		229,023			340,850			519,107			558,051
Other operating expenses		75,227			3,218			141,195			95,594
Total operating expenses		436,922			344,068			1,072,559			794,840
Loss from operations		(484,008	)		(344,068	)		(1,120,513	)		(794,840	)
Other income (expense):
Change in fair value of derivative liabilities		106,912			1,391,883			(162,016	)		4,015,061
Gain/(loss) in fair value of cryptocurrencies		1,517			—			(55,083	)		—
Interest income		1,909			—			3,750			—
Interest expense		(104,247	)		(97,125	)		(266,381	)		(128,616	)
Total other income (expense)		6,091			1,294,758			(479,730	)		3,886,445
Income (loss) from continuing operations		(477,917	)		950,690			(1,600,243	)		3,091,605
Gain on disposal of Timefire, LLC		—			—			670,428			—
Loss from discontinued operations		—			(491,830	)		(180	)		(1,204,053	)
Income (loss) from discontinued operations		—			(491,830	)		670,248			(1,204,053	)
Income tax expense		—			—			—			—
Net income (loss)	$	(477,917	)	$	458,860		$	(929,995	)	$	1,887,552
Basic net income (loss) per common share	$	(0.00	)	$	0.01		$	(0.01	)	$	0.04
Diluted net income (loss) per common share	$	(0.00	)	$	0.01		$	(0.01	)	$	0.03
Basic weighted average common shares outstanding		201,582,049			46,245,375			158,123,082			45,558,859
Diluted weighted average common shares outstanding		201,582,049			69,461,003			158,123,082			68,774,487
The accompanying notes are an integral part of these unaudited financial statements.

4

TIMEFIREVR INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
	Six Months Ended
	June 30,			June 30,
	2018			2017
Operating Activities:
Net income (loss) from continuing operations	$	(1,600,243	)	$	3,091,605
Net income (loss) from discontinued operations		670,248			(1,204,053	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		21,134			6,303
Common stock issued for services		228,233			242,500
Warrants and options issued for services		464,834			338,334
Change in derivative liabilities		162,016			(4,015,061	)
Net cryptocurrencies received in lieu of cash		(8,501	)		—
Loss in fair value of cryptocurrencies		55,083			—
Restricted stock units issued for services		—			128,693
Interest expense from amortization of debt discount		37,496			24,456
Gain on sale of subsidiary		(670,428	)		—
Changes in operating assets and liabilities:
Accounts receivable		(280	)		(341	)
Interest receivable		(3,600	)		—
Prepaid expenses and other current assets		(75,997	)		(64,205	)
Escrow fund		—			71,546
Deposits		(459,648	)		78,000
Accrued interest		229,066			119,603
Accounts payable and accrued expenses		(94,777	)		254,904
Net Cash Used in Operating Activities		(1,045,364	)		(927,716	)
Investing Activities:
Purchases of property and equipment		(328,305	)		—
Proceeds from sale of subsidiary net of subsidiary cash		99,495			—
Purchase of cryptocurrency		(100,000	)		—
Net Cash Used in Investing Activities		(328,810	)		—
Financing Activities:
Net proceeds from convertible notes payable		1,000,000			617,500
Net proceeds from convertible notes payable - related party		—			95,000
Net Cash Provided by Financing Activities		1,000,000			712,500
Net Increase in Cash		(374,174	)		(215,216	)
Cash - Beginning of Period		559,237			225,379
Cash - End of Period	$	185,063		$	10,163
Supplemental disclosure of non-cash investing and financing activities:
Issuance of Series E Preferred for Series A, A-1 and C Preferred and warrants	$	1,629,992		$	—
Issuance of Series E Preferred for convertible debt and accrued interest	$	939,966		$	—
Conversion of Series E Preferred stock to common stock	$	174,724		$	—
Conversion of Series C Preferred stock to common stock	$	—		$	1,130
Conversion of Series A-1 Preferred stock to common stock	$	—		$	545
Note receivable from sale of subsidiary	$	120,000		$	—
Supplemental disclosure of cash flow information:
Interest paid in cash	$	—		$	135
Income taxes paid in cash	$	—		$	—
The accompanying notes are an integral part of these unaudited financial statements.

5

TIMEFIREVR INC.

NOTES TO FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies and Use of Estimates

Basis of Presentation and Organization and Reorganization

Effective September 13, 2016, TimefireVR Inc., a Nevada corporation (“Timefire,” “we,” “us,” “our” or the “Company”) entered into an Agreement and Plan of Merger (“Merger Agreement” or the “Merger”) through which it acquired Timefire LLC, a Phoenix-based virtual reality content developer and Arizona Limited Liability Company (“TLLC”). As consideration for the Merger, the Company issued the equity holders of TLLC a total of 41,400,000 shares of its common stock, and 2,800,000 five-year warrants exercisable at $0.58 per share for 100% of the membership interests of TLLC. As a result, the former members of TLLC owned approximately 99% of the then outstanding shares of common stock.

On January 3, 2018, the Company entered into a Membership Interest Purchase Agreement (the “Agreement”) by and between the Company and Mitchell Saltz (“Saltz”). Pursuant to the terms of the Agreement, Saltz acquired all the membership interests of the Company’s subsidiary, Timefire LLC (“TLLC”).

In consideration for entering in the Agreement, the Company received: (i) $100,000 in cash and (ii) a secured (by all the tangible and intangible property of TLLC) promissory note in the principal amount of $120,000 bearing 6% annual interest maturing on September 28, 2018. Additionally, Saltz or TLLC assumed certain of the Company’s liabilities including a sublease agreement entered into by the Company, loans made by Saltz to the Company, a certain $100,000 senior convertible note of the Company dated March 3, 2017, a certain services agreement entered into by the Company, certain past compensation owed to the Company’s former executive officers, and certain credit card debts owed by the Company.

On January 3, 2018, the Company purchased $100,000 of ether, the cryptocurrency offered by the Ethereum network. This purchase was the Company’s first material cryptocurrency purchase and signified the start of the Company’s entry into the cryptocurrency business. The Company records its cryptocurrency holdings at fair value as of valuation date. The Company recorded net loss on fair value of its cryptocurrency holdings of $55,083 for the six months ended June 30, 2018.

Unaudited Interim Financial Statements

The interim financial statements of the Company as of June 30, 2018 and 2017, and for the periods then ended, are prepared in accordance with the instructions to Form 10-Q. Accordingly, the accompanying financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States of America (“U.S. GAAP”). However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company’s financial position as of June 30, 2018 and the results of its operations and its cash flows for the periods ended June 30, 2018 and 2017. These results are not necessarily indicative of the results expected for the year ended December 31, 2018. The financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2017, filed with the U.S. Securities and Exchange Commission (the “SEC”) on April 9, 2018. The balance sheet as of December 31, 2017 has been derived from the audited financial statements included in that filing.

Principles of Consolidation

For accounting purposes, the Merger transaction was recorded as a reverse recapitalization, with TLLC as the accounting acquirer. Consequently, the historical pre-Merger financial statements of TLLC were then those of the Company. The financial statements for periods December 31, 2017 and prior include the accounts of the Company and TLLC. All significant intercompany transactions and balances have been eliminated. Equity investments through which we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee's activities are accounted for using the equity method where applicable.

Reclassifications

For the three and six months ended June 30, 2017, the Company’s Statement of Operations and Cash Flows have been reclassified to the current presentation to reflect the discontinued operations resulting from the sale of TLLC. The reclassified financial statement items had no effect on net income for the periods.

6

Discontinued Operations

The Company has classified the operating results related to the TLLC virtual reality business, which was sold on January 3, 2018, as discontinued operations in the financial statements. As per SEC guidelines, the December 31, 2017 balance sheet has not been retrospectively adjusted to reflect discontinued operations. Such adjustment will be reflected when the December 31, 2017 balance sheet is first presented with annual financial statements that report discontinued operations.

Discontinued operations consist of specifically identified expenses as follows:

TIMEFIREVR INC.
STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended					Six Months Ended
	June 30,		June 30,			June 30,			June 30,
	2018		2017			2018			2017
Revenues	$	—	$	488		$	—		$	488
Cost of sales		—		146			—			146
Gross profit		—		342			—			342
Operating expenses:
Research and development		—		344,001			—			792,892
Occupancy		—		20,135			—			43,342
Depreciation and amortization		—		3,151			—			6,303
Officer compensation		—		108,864			—			321,720
Professional fees		—		1,062			—			1,562
Other operating expenses		—		2,829			—			23,000
Total operating expenses		—		480,042			—			1,188,819
Loss from operations		—		(479,700	)		—			(1,188,477	)
Other income (expense):
Gain on disposal of Timefire, LLC		—		—			670,428			—
Interest income		—		—			—			2
Interest expense		—		(12,130	)		(180	)		(15,578	)
Total other income (expense)		—		(12,130	)		670,248			(15,576	)
Income (loss) from discontinued operations	$	—	$	(491,830	)	$	670,248		$	(1,204,053	)

Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates. Significant estimates of the Company include accounting for depreciation and amortization, derivative liabilities, accruals and contingencies, the fair value of the Company’s common stock and the estimated fair value of warrants.

Revenue Recognition

On January 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASC 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under U.S. GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation.

The Company is paid in cryptocurrency for its mining operations. The revenue generated is valued by the cryptocurrency fair value on the date earned.  

Cash and Cash Equivalents

The Company considers all highly liquid instruments, with original maturity of three months or less when purchased, to be cash equivalents. We place our cash and cash equivalents with major financial institutions. Such amounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”). From time to time, balances may exceed FDIC coverage limits.

Property and Equipment

Property and equipment is recorded at cost reduced by accumulated depreciation. Depreciation is provided for on the straight-line method, over the estimated useful lives of the assets. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Betterments or renewals are capitalized when incurred. Gains and losses on the disposition of property and equipment are recorded in the period incurred.

The estimated useful lives of property and equipment are:

· Office furniture and equipment   3-5 years

Impairment of Long-Lived Assets and Intangible Assets

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 360-10, "Property, Plant, and Equipment," which established a "primary asset" approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset and amortizable intangible asset to be held and used. Long-lived assets and amortizable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset and amortizable intangible asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Long-lived assets and amortizable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

7

Business Segments

ASC 280, "Segment Reporting" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment as of June 30, 2018.

Research and Development Costs

Research and development costs, including design, development and testing of software, are expensed as incurred.

Income Taxes

The Company accounts for income taxes under FASB ASC 740, Income Taxes. Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

Stock-Based Compensation

In accordance with ASC No. 718, Compensation – Stock Compensation (“ASC 718”), the Company measures the compensation costs of stock-based compensation arrangements based on the grant date fair value of granted instruments and recognizes the costs in the financial statements over the period during which such awards vest. Stock-based compensation arrangements include stock options and restricted stock awards.

Equity instruments (“Instruments”) issued to non-employees are recorded on the basis of the fair value of the Instruments, as required by ASC 718. ASC No. 505, Equity Based Payments to Non-Employees (“ASC 505”), defines the measurement date and recognition period for such Instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete and (ii) the Instruments are vested. The measured fair value related to the Instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in ASC 505.

Net Income (Loss) Per Share

Basic earnings per share does not include dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could share in the earnings of an entity. Dilutive securities are not included in the weighted average number of shares when inclusion would be anti-dilutive. As of June 30, 2018 and 2017, there were total shares of 192,232,724 and 23,215,628, respectively, issuable upon conversion of preferred stock, exercise of warrants and options.

Fair Value Measurements

ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in U.S. GAAP, and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2018. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, accounts payable and accrued expenses.

8

Derivative Liabilities

The Company issued common stock purchase warrants in September 2016 in conjunction with the Merger Agreement.  Additional warrants were issued in March and August 2017 as part of private placement offerings. Warrants were also issued in March 2018 as part of a private placement offering (see Note 5) and per an advisory agreement (see Note 7). In accordance with ASC No. 480, Distinguishing Liabilities from Equity (“ASC 480”), the fair value of these warrants is classified as a liability on the Company’s Balance Sheets because, according to the warrants' terms, a fundamental transaction could give rise to an obligation of the Company to pay cash to certain warrant holders. Corresponding changes in the fair value of the warrants are recognized as a gain or loss on the Company’s Statements of Operations in each subsequent period.

The fair value of the warrants at June 30, 2018 and December 31, 2017 was $231,176 and 198,994, respectively. The difference has been recorded as a change in change in fair value of derivatives.

2. Going Concern

The Company has incurred losses since inception and requires additional funds for future operating activities. The Company has not reached a level of revenue sufficient to fund its operating activities. These factors create an uncertainty as to how the Company will fund its operations and maintain sufficient cash flow to operate as a going concern. The combination of these factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in response to these factors include the issuances of debt in exchange for cash such as that which is described in Note 5, Convertible Notes Payable.

The Company’s ability to meet its cash requirements in the next year is dependent upon obtaining additional financing. If this is not achieved, the Company will be unable to obtain sufficient cash flow to fund its operations and obligations, and as a result there is substantial doubt the Company will be able to continue as a going concern. The accompanying financial statements have been prepared on a going concern basis, and accordingly, do not include any adjustments relating to the recoverability and classification of recorded asset amounts; nor do they include adjustments to the amounts and classification of liabilities that might be necessary should the Company be unable to continue operations or be required to sell its assets.

3. Gain on Disposal of Timefire LLC

As discussed in Note 1, on January 3, 2018, the Company entered into the Agreement. Pursuant to the terms of the Agreement, Mr. Saltz acquired all the membership interests of TLLC.

In consideration for entering into the Agreement, the Company received: (i) $100,000 in cash and (ii) a secured promissory note in the principal amount of $120,000 bearing 6% annual interest that matures on September 28, 2018. Additionally, Mr. Saltz and TLLC each assumed certain of the Company’s liabilities including a sublease agreement entered into by the Company, loans made by Mr. Saltz to the Company, a certain $100,000 senior convertible note from the March 2017 Notes, as defined below, a certain services agreement entered into by the Company, certain past compensation owed to the Company’s former executive officers, and certain credit card debts owed by the Company. Total gross proceeds from the sale were $220,000, including the cash payment and secured promissory note, plus $510,599 in liabilities relieved, less $60,171 of assets sold to TLLC resulted in a gain on disposal of $670,428.

Assets sold:
Cash	(505	)
Property & equipment, net	(26,128	)
Accounts receivable	(38	)
Deposit	(33,500	)
	(60,171	)
Liabilities relieved:
Accounts payable & accrued expenses	204,809
Demand obligation payable - related party	116,883
Convertible notes payable	100,000
Accrued interest	31,507
Short-term advance - related party	57,400
	510,599
Additional consideration:
Note receivable	120,000
Cash	100,000
	220,000
Gain on disposal of Timefire, LLC	670,428

The gain on disposal is included in the income from discontinued operations on the profit and loss statement for the six months ended June 30, 2018.

9

4. Cryptocurrencies

On January 3, 2018, the Company purchased $100,000 of ether (106.95 units), the cryptocurrency offered by the Ethereum network. The fair value of such ether units on June 30, 2018 was $46,627 and the Company took a charge to operations of $53,364 in the six months ended June 30, 2018. That amount is included in gain/loss on the fair value of cryptocurrencies in the accompanying statement of operations.

In April 2018, the Company began its mining operations. The Company is paid in cryptocurrency for these operations. It started out mining Bitcoin and later, in June 2018, expanded into the mining of ether. The revenue generated is valued by the cryptocurrency fair value on the date earned. Such amounts aggregated $8,917 for the six months ended June 30, 2018. The fair value of the earned cryptocurrency is adjusted at quarter end, resulting in a charge to operations.

5. Convertible Notes Payable

On March 6, 2017, the Company closed on a private placement offering with institutional investors and one of the Company’s former directors pursuant to which the Company issued and sold the investors senior convertible notes (the “March 2017 Notes”) in the aggregate principal amount of $750,000, with an original issue discount of 5%, for gross proceeds to the Company of $712,500 prior to payment of $20,000 in reimbursement of legal fees of the lead investor. The March 2017 Notes had an original maturity date of September 3, 2017 with an initial interest rate of 8%, and a default interest rate of 18% which became effective as of the maturity date. On the maturity date, the Company was obligated to repay an amount equal to 120% of outstanding principal and accrued interest. On the maturity date (and subsequently, if the holders had elected to extend the maturity date), the investors had the right to convert the Notes into the common stock of the Company at $0.30 per share, subject to adjustment (the “Conversion Price”). As additional consideration, the Company issued the investors a total of 2,500,000 five-year warrants to purchase the Company’s common stock, which are exercisable on or after the maturity date at $0.35 per share. The Company failed to pay the March 2017 Notes on the maturity date, which date the investors did not elect to extend.

On August 18, 2017, the Company closed on an offering of convertible notes and warrants on terms substantially identical to the March 6, 2017 financing. The purchasers are the same investors as in the March 2017 Notes except for the former director who did not participate in this financing. The Company received $60,000 in net proceeds from the issuance of $63,158 of convertible notes (the “August 2017 Notes”). Additionally, the Company issued the investors a total of 210,526 five-year warrants exercisable at $.35 per share. The Company failed to pay the August 2017 Notes when due on September 3, 2017.

The March 2017 Notes and August 2017 Notes and accompanying warrants were converted on January 3, 2018 into Series E Preferred stock. See Note 8.

On October 27, 2017, the Company closed on an offering of convertible notes with two institutional investors in the principal amount of $70,000 (the “October 2017 Notes”). The October 2017 Notes matured on November 29, 2017 and bear interest at 8% per annum. On the maturity date, the Company was obligated to repay an amount equal to 120% of the outstanding principal and accrued interest. The investors may elect to convert the October 2017 Notes into common stock of the Company at $.03 per share. The Company failed to pay these October 2017 Notes when due.

On December 21, 2017, the Company closed on an offering with three institutional investors pursuant to which the Company issued and sold convertible notes in the aggregate principal amount of $703,947 (the “December 2017 Notes”). The December 2017 Notes had an original issue discount of 5%, for proceeds to the Company in the amount of $668,750. The notes matured on January 20, 2018, bear interest at 8%, and require the repayment of 120% of principal and accrued interest at maturity. The investors may elect to convert the December 2017 Notes into common stock of the Company at $.03 per share.

On March 6, 2018, the holders of the October 2017 Notes and December 2017 Notes agreed to extend the due date of these notes to April 15, 2019 as discussed below.

On March 6, 2018, the Company closed on a private placement offering with institutional investors pursuant to which the Company issued and sold Senior Secured Convertible Notes (the “2018 Notes”) to the Investors in the aggregate principal amount of $1,052,632 with an original issue discount of 5% and received gross proceeds of $1,000,000. The 2018 Notes mature on April 15, 2019 and bear interest at 8% per annum. The 2018 Notes are secured by a first lien on all of the assets of the Company. On the maturity date, the Company must repay an amount equal to 120% of the outstanding principal and accrued interest. Beginning on the six-month anniversary of the issuance of the 2018 Notes, the investors may elect to convert the 2018 Notes into common stock of the Company at $0.03 per share, subject to adjustment. In addition, the 2018 Notes are redeemable by the Company up to 90 days following issuance at an amount equal to 110% of outstanding principal and accrued interest, and thereafter at an amount equal to 120% of outstanding principal and accrued interest, subject in either case to upward adjustment to the extent the closing price of the Company’s common stock on the OTCQB exceeds the Conversion Price. As additional consideration, the Company issued the investors a total of 35,087,720 five-year warrants to purchase the Company’s common stock, which are exercisable on or after the six-month anniversary of the issuance at $0.06 per share. In addition, the Investors agreed to extend the due date of the October 2017 Notes and December 2017 Notes.

The aggregate principal amount of the above described notes is $1,826,579, which is shown in the accompanying balance sheet as of June 30, 2018, net of $37,427 debt discount, as convertible notes payable-net. Accrued interest amounted to $292,575 as of that date and interest expense aggregated $266,381 for the six months ended June 30, 2018.

6. Related Party Transactions

On March 6, 2017, the Company issued one of the March 2017 Notes to a former director as an investor for $100,000. The Company’s obligation under the March 2017 Notes was cancelled on January 3, 2018 as described below.  

On June 2, 2017, the Company entered into an agreement with an entity managed by a former director of the Company to provide services to the entity. A retainer deposit of $57,400 was received, and services were to be initiated within sixty days. The Company’s obligation under this agreement was cancelled on January 3, 2018 as described below.

During the year ended December 31, 2017, the Company received advances totaling $116,883 from a related party, an original TLLC investor. These advances are not evidenced by a promissory note, and are non-interest bearing. The Company’s obligation to repay this amount was cancelled on January 3, 2018 as described below.

On January 3, 2018, the Company effected the sale of TLLC to a group of persons including TLLC’s former owners and two of the Company’s former executive officers and directors.

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7. Commitments and Contingencies

Employment Agreements

Effective September 13, 2016, the Company entered into an employment agreement with its former President, John Wise. The agreement was for a two year period at the rate of $150,000 per annum. The Company was in default on this agreement, and the payroll for this officer accrued from July 8, 2017 until his resignation in October 2017.

Effective September 13, 2016, the Company entered into an employment agreement with its former Chief Strategy Officer, who was later named Chief Executive Officer, Jeffrey Rassas. The Company was in default on this agreement, and the payroll for this officer accrued from May 16, 2017 until his resignation in October 2017.

Aggregate accrued payroll for these two former officers was approximately $106,000 as of December 31, 2017. These obligations were cancelled on January 3, 2018 as part of the sale of TLLC.

Effective January 3, 2018, the Company entered into an oral employment agreement (the “Read Agreement”) with the Company’s current Chief Executive Officer (the “CEO”), Jonathan Read. Under the terms of the Read Agreement the Company is paying Mr. Read an annual salary of $240,000 subject to his continued employment with the Company. Additionally, the Company paid Mr. Read compensation for his services as the Company’s CEO from October 20, 2017, to December 31, 2017, calculated as a pro-rata portion of an annual salary of $150,000. Additionally, on January 3, 2018 (the “Grant Date”) the Company’s Board of Directors (the “Board”) granted Mr. Read 15,000,000 stock options of which 5,000,000 vested on the Grant Date, 5,000,000 will vest one-year from the Grant Date, and 5,000,000 will vest two years from the Grant Date subject to continued employment with the Company.

Effective January 3, 2018, the Company agreed to compensate Gary Smith for his service as a non-employee director by paying him $2,500 per calendar quarter effective as of July 10, 2017.

Lease Agreements

On September 23, 2016, the Company entered into an office lease agreement commencing October 1, 2016.  This lease expires December 31, 2018.  As part of the sale of TLLC, the Company was released of this lease obligation as well as the rights to the security deposit. The Company has been renting an office space on a month-to-month basis, and incurred rent expense of approximately $5,400 during the six months ended June 30, 2018.

Other Agreements

On January 20, 2017, the Company entered into an agreement with a firm to provide their artificial intelligence conversational voice platform for integration into the Company’s product. Per the agreement, the Company issued 50,000 shares of common stock and was scheduled to make monthly payments towards a $127,500 integration fee. As of December 31, 2017, the Company had expensed $46,000, with $35,000 remaining in accounts payable. On January 3, 2018, the Company sold TLLC, and this payable, and any future obligations under this agreement, were relieved as part of this transaction.

On November 7, 2016, the Company entered into an agreement with a firm to provide general advisory and business development advisory services for a fee of $75,000. The Company remitted $75,000, but the contract was ultimately cancelled and the services were postponed. The amount was recorded as a deposit on contract. Later, on March 27, 2017, the Company entered into an agreement with the same firm to provide these services on an expanded scale for a fee of $150,000. Per the agreement, the firm applied our previously remitted funds and we paid the remaining $75,000 balance. In addition to the cash compensation, the firm was also compensated via a one-time equity retainer of 25,000 shares of common stock.

On April 4, 2017, the Company entered into an agreement with a firm to provide management and general business consulting services. The term of the agreement is 24 months, and the firm will be compensated via the issuance of 1,000,000 shares of common stock at a price of $.21 per share. The shares will be expensed ratably over the term of the agreement.

On January 18, 2018, the Company entered into an agreement for corporate communications services. The agreement is for an initial period of six months with a monthly fee of $5,000. Should the Company raise $2,000,000 or more, the monthly fee increases to $7,500 per month. The Company will also issue 1,000,000 shares of common stock per this agreement. These shares have not yet been issued as of the date of this report.

On March 16, 2018, the Company entered into an Advisor Agreement (the “Advisor Agreement) with a third party (the “Advisor”), and David Drake (“Drake”), a consultant to the cryptocurrency industry. Under the terms of the Advisor Agreement, Drake was appointed to the Company’s Advisory Board and Drake and the Advisor agreed to assist the Company in the implementation and execution of its cryptocurrency business model, including initiation of its mining business and recommending to the Company potential acquisitions and joint ventures in this sector. Drake is required to devote at least three business days per month to assisting the Company. The Company agreed to issue the Advisor 6,666,666 shares of common stock valued at $0.03 per share, which shares shall vest quarterly over a 12-month period subject to the Advisor Agreement not having been terminated as of each applicable vesting date. The Company also issued the Advisor 6,666,666 3-year warrants, with the same vesting period, exercisable at $0.05 per share. The Company agreed to pay the Advisor a royalty from revenues received from its mining of cryptocurrency with the royalties decreasing over a five-year period. Finally, the Company agreed to reimburse the Advisor $5,000 a month for the services of an engineer to operate the Company’s cryptocurrency mining business.

On May 15, 2018, the Company entered into a Master Service Agreement with ColoGuard Enterprise Solutions (“ColoGuard”) which becomes effective August 1, 2018. ColoGuard will provide colocation and other services related to our cryptocurrency mining activities. The initial term of the agreement is two years, with automatic 12-month renewals unless thirty days written notice is provided. The monthly obligation under the agreement with the current specifications is $30,212. On June 27, 2018, the Company made a $459,648 deposit towards mining equipment (totaling $646,000) to ColoGuard. This equipment is scheduled to be placed into operation during the quarter ended September 30, 2018.

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8. Shareholders’ Deficit

Common Stock

There is currently only one class of common stock. Each share of common stock is entitled to one vote. The authorized number of shares of common stock of the Company at June 30, 2018 was 500,000,000 shares with a par value per share of $0.001. Authorized shares that have been issued and fully paid amounted to 228,460,470 as of June 30, 2018.

Preferred Stock

The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.01 per share, with rights, preferences and limitations as may be decided from time-to-time by the Board of Directors.

Series E

Effective January 3, 2018, the Board of Directors authorized the issuance of up to 305,000 shares of Series E Convertible Preferred Stock ("Series E"). Each share of Series E has a stated value of $1,000 and is convertible into shares of our common stock at a conversion price of $1.00 per share. The Series E does not have any price protection from future issuances of securities by the Company at a price below the conversion price then in effect.

Pursuant to an Exchange Agreement entered into effective January 3, 2018, we issued 303,714 shares of the Series E in exchange for the cancellation of the following securities:

• 133,333.69 shares of Series A Convertible Preferred Stock (extinguishing such series) - 133,334 Series E shares;
• 14,923.30 shares of Series A-1 Convertible Preferred Stock (extinguishing such series) – 44,770 Series E shares;
• 501.54 shares of Series C Convertible Preferred Stock (extinguishing such series) – 50,154 Series E shares;
• $650,000 of Senior Convertible Notes issued March 3, 2017 – 63,368 Series E shares;
• $63,158 of Senior Convertible Notes issued August 21, 2017 – 7,125 Series E shares; and
• Warrants to purchase 4,963,402 shares of our common stock – 4,963 Series E shares.

During the six months ended June 30, 2018, holders of 174,524 shares of Series E converted them into 174,524,000 shares of our common stock. At June 30, 2018, there are 129,190 shares of Series E outstanding, which are convertible into an aggregate of 129,190,000 shares of our common stock.

Series C

In 2014, the Board approved the issuance of Series C Preferred Stock (“Series C”). Each share of Series C shall be convertible at the option of the holder at any time, into 10,000 shares of common stock. During the year ended December 31, 2017, holders of 113 shares of Series C converted them into 1,130,000 shares of our common stock. At December 31, 2017, there are 501.54 shares of Series C outstanding. Effective January 3, 2018, all Series C shares were cancelled in exchange for 50,154 Series E shares.

Series A-1

Effective August 24, 2016, the Board approved the issuance of Series A-1 Preferred Stock (“Series A-1”). Each share of Series A-1 shall be convertible at the option of the holder at any time, into 100 shares of common stock. During the year ended December 31, 2017, holders of 5447.39 shares of Series A-1 converted them into 544,739 shares of common stock. At December 31, 2017, there are 14,923 shares of Series A-1 outstanding. Effective January 3, 2018, all Series A-1 shares were cancelled in exchange for 44,770 Series E shares.

Series A

Effective September 13, 2016, the Company closed on the SPA and the Board approved the issuance of a newly designated Series A Convertible Preferred Stock (“Series A”). At December 31, 2017, there were 133,334 shares of Series A outstanding. Effective January 3, 2018, all Series A shares were cancelled in exchange for 133,334 Series E shares.

The Series A contained certain provisions that were outside the Company's control and which the Company believed caused the Series A to be classified as mezzanine equity.

Warrants

The balance of warrants outstanding for purchase of the Company’s common stock as of June 30, 2018 is as follows:

	Common Shares Issuable Upon Exercise of Warrants			Exercise Price of Warrants		Date Issued	Expiration Date
Balance of warrants at December 31, 2017		8,096,736
Cancelled in exchange for Series E (1)		(4,963,402	)
Issued per offering (2)		35,087,720		$	.06	3/6/2018	9/6/2023
Issued for services (3)		6,666,666		$	.05	3/16/2018	3/16/2021
Balance of warrants at June 30, 2018		44,887,720

(1) As discussed above, on January 3, 2018, 4,963,402 warrants to purchase shares of common stock were cancelled in exchange for 4,963 Series E shares.

(2) On March 6, 2018, pursuant to the 2018 Notes (see Note 5), the Company issued warrants at $.06 to purchase 35,087,720 shares of common stock. The warrants may not be exercised for six months after their effective date of March 6, 2018. The warrants have an expiration date of five years after the initial six months have passed. As of June 30, 2018, the Company has recorded $185,263 as a derivative liability for these warrants.

(3) On March 16, 2018, per the terms of the Advisor Agreement (see Note 7), the Company issued warrants at $.05 to purchase 6,666,666 shares of common stock. The warrants have an expiration date of March 16, 2021. As of June 30, 2018, the Company has recorded $33,600 as a derivative liability for these warrants.

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2016 Equity Incentive Plan

Effective September 13, 2016, the Company adopted the 2016 Equity Incentive Plan (the "2016 Plan") to provide an incentive to our employees, consultants, officers and directors who are responsible for or contribute to our long-range success. A total of 3,300,000 shares of our common stock were originally reserved for the implementation of the 2016 Plan, either through the issuance of incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, or restricted stock units. Whenever practical, the 2016 Plan is to be administered by a committee of not less than two members of the Board of Directors appointed by the full Board, and the 2016 Plan has a term of ten years, unless sooner terminated by the Board. On January 3, 2018, the Board amended the Company’s 2016 Equity Incentive Plan by increasing the authorized number of shares available under the plan by 30,000,000. As of June 30, 2018, 15,145,000 shares of common stock remain available for issuance under the 2016 Plan.

Effective September 13, 2016, pursuant to his employment agreement, the Company entered into a Restricted Stock Unit (“RSU”) Agreement with Mr. Read which granted him 500,000 RSUs pursuant to the 2016 Plan. The RSUs were to vest in three approximately equal increments with the first tranche being fully vested on the grant date and the remaining tranches vesting on the first-year and second-year anniversaries of the grant date. The fair value of the award was calculated based on the price of the common stock on the grant date and was to be expensed over the vesting period. Effective January 31, 2017, Mr. Read’s former employment agreement was terminated and the RSUs became fully vested. The Company recorded $0 and $128,695 in expense related to this grant during the six months ended June 30, 2018 and 2017, respectively.

On January 20, 2017, the Company granted options to purchase 1,655,000 shares of its common stock at $.50 to employees including a total of 800,000 options to its then Chief Executive Officer and Chief Financial Officer per the 2016 Plan. The shares will vest based on months of service as of the grant date. Employees that had worked for twelve months or more as of the grant date had one-third of their options vested as of grant date. All other employees received pro-rata vesting for the portion of a year that they had worked. The remaining options will equally vest on the 1^st and 2^nd anniversary of the grant date. The Company recorded $145,550 and $338,333 in expense related to this grant during the six months ended June 30, 2018 and 2017, respectively.

On January 3, 2018, as part of an oral employment agreement with the Company’s Chief Executive Officer, the Company granted Mr. Read 15,000,000 stock options of which 5,000,000 vested on the grant date, 5,000,000 will vest one-year from the grant date, and 5,000,000 will vest two years from the grant date subject to continued employment with the Company. The Company recorded $219,150 in expense related to this grant during the six months ended June 30, 2018.

On January 22, 2018, the Company granted board member Gary Smith 1,000,000 stock options under the 2016 Plan, exercisable at $.03 per share, vesting quarterly over one year beginning in three months subject to continued service as a director on each applicable vesting date. The Company recorded $12,200 in expense related to this grant during the six months ended June 30, 2018.

9. Fair Value Measurements

Our financial instruments consist of cash, accounts payable, accrued liabilities, and warrant liability. We do not believe that we are exposed to significant interest, currency, or credit risks arising from these financial instruments. The fair values of the warrants approximates their carrying values using Level 3 inputs. Gains and losses recognized on changes in fair value of the warrants are reported in other income (expense). Our warrant valuation was measured at fair value by applying the Black-Scholes option valuation model, which utilizes Level 3 inputs.

The assumptions used in the Black-Scholes option re-valuation for the September 2016 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 3.25 years
Risk-free interest rate - 2.63%	Volatility – 216.150%.

The assumptions used for the March 2017 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 4.25 years
Risk-free interest rate - 2.73%	Volatility – 223.895%.

The assumptions used for the March 6, 2018 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 5.25 years
Risk-free interest rate - 2.73%	Volatility – 214.446%.

The assumptions used for the March 16, 2018 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 2.75 years
Risk-free interest rate - 2.63%	Volatility – 259.419%.

The following summarizes the Company's financial liabilities that are measured at fair value on a recurring basis at June 30, 2018.

	Level 1		Level 2		Level 3		Total
Liabilities
Derivative liabilities	$	—	$	—	$	231,176	$	231,176

10. Subsequent Events

On July 17, 2018, the Company issued 7,000,000 shares of common stock for the conversion of 7,000 shares of Series E.

Effective August 7, 2018, (the “Effective Date”) the Company borrowed $76,000 from an institutional investor (the “Investor”) and issued the Investor a 5% Original Issue Discount Promissory Note (the “Note”) in the total principal amount of $80,000. The Note matures on the sixth month anniversary of the Effective Date and bears interest at 12% per annum. The Note automatically becomes due and payable upon the Company closing a financing through which the Company receives proceeds of at least $125,000.

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ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis should be read in conjunction with TimefireVR Inc. financial statements and the related notes thereto. The Management's Discussion and Analysis contains forward-looking statements that involve risks and uncertainties, such as statements relating to our liquidity, and our plans in the cryptocurrency business. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect,” and the like, and/or future-tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements in this Report on Form 10-Q. The Company’s actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. Investors should review the Risk Factors in the Company’s Form 10-K for the year ended December 31, 2017. Except as required by U.S. securities laws, the Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Report on Form 10-Q.

The following discussion should be read in conjunction with our unaudited consolidated financial statements and related notes and other financial data included elsewhere in this 10-Q. See also the notes to our consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2017.

OVERVIEW

The Company is a Nevada corporation incorporated on April 10, 2002. On November 21, 2016, we changed our name to TimefireVR, Inc. We are currently in the process of changing our name to TeraForge Ventures Inc., subject to shareholder approval.

Effective September 13, 2016, the Company acquired TLLC, a Phoenix-based virtual reality content developer. As consideration for the Merger Agreement, the Company issued the equity holders of TLLC a total of 41,400,000 shares of the Company's common stock and 2,800,000 five-year warrants.

On January 3, 2018, the Company effected the sale of TLLC to a person (the “TLLC Lender”) who had lent the Company or TLLC funds in 2017 without any documentation in order to keep employees from quitting. The Company understood he was acting on behalf of a group (“TLLC Purchasers”) which included its former owners as well as two of our former executive officers and directors. The Company received: (i) $100,000 in cash and (ii) a secured promissory note in the principal amount of $120,000 bearing 6% annual interest that matures in September 2018. Additionally, the TLLC Purchasers assumed certain of the Company’s liabilities totaling approximately $558,054. The Company’s business model in the virtual reality business was not successful and the Company was unable to continue to finance its business due to a loss of confidence in the virtual reality business by the Company’s investors (“Prior Investors”) who held past due convertible notes, and threats of resignation from the remaining TLLC employees. The Prior Investors refused to further finance the Company unless TLLC was shut down or preferably sold; the TLLC Lender whose loans were treated as demand loans refused to fund TLLC if it remained owned by the Company. While shareholder approval was required by Nevada law, the TLLC Purchasers refused to fund TLLC unless we closed immediately. Prior Investors that had financed the Company had agreed to provide further funding if we sold TLLC and received a release from key liabilities including past due promissory notes. Rather than cease operations and have no working capital, we adhered to the TLLC Purchaser’s demands and closed the sale. Pending finalization of the sale of TLLC over the year-end holidays, our Prior Investors lent us approximately $669,000 on December 21, 2017 and cancelled certain past due notes they held on January 3, 2018 as explained in the following paragraph. Because we wanted to eliminate state law liabilities, we opted to get irrevocable proxies which would permit us to seek shareholder ratification. On August 14, 2018, we have filed an amendment to our preliminary proxy statement.

Effective January 3, 2018, the Company entered into an exchange agreement with certain of the Company’s Prior Investors pursuant to which the Company issued 303,714 shares of the Company’s new Convertible Series E Preferred Stock in exchange for the cancellation of the Company’s Series A, Series A-1, Series C, the March 2017 Notes, the August 2017 Notes, and certain of the Company’s outstanding Warrants. This exchange had the effect of simplifying our capital structure and eliminating past due secured debt while substantially increasing future potential dilution.

On March 6, 2018, we borrowed $1 million from these same investors and issued them $1,052,632 of the 2018 Notes which are due on April 15, 2019. The 2018 Notes pay 8% per annum interest and are convertible at $0.03 per share. On the maturity date, we must pay 120% of the principal of the 2018 Notes. The 2018 Notes are secured by a first lien on the Company's assets.

On January 3, 2018, we announced our entry into the cryptocurrency and blockchain business. The Company’s current business is focused on the mining of bitcoin, ethereum and litecoin. The Company has expanded that business and has moved its mining operations to Allentown, PA from its prior location in Brooklyn, NY.

In order to secure the technical expertise to engage in the cryptocurrency mining business, we entered into the Advisory Agreement with two parties on March 16, 2018. See Note 7.

Results of Operations

The following discussion analyzes our results of operations for the three and six months ended June 30, 2018 and 2017. The following information should be considered together with our financial statements for such periods and the accompanying notes thereto.

Revenues for the three months ended June 30, 2018 and 2017 were $8,917 and $0, respectively. The Company generated its first mining revenues in the quarter ended June 30, 2018. Operating expenses for the quarter ended June 30, 2018 amounted to $436,922 as compared to $344,068 for the quarter ended June 30, 2017. This was primarily due to the increase in officer compensation. The net loss for the three months ended June 30, 2018 was $477,917 as compared to a net income of $458,860 for the quarter ended June 30, 2017. This difference is primarily due to the change in fair value of derivative, which created a non-cash gain for the three months ended June 30, 2017 of $1,391,883.

Revenues for the six months ended June 30, 2018 and 2017 were $8,917 and $0, respectively. Operating expenses for the six months ended June 30, 2018 amounted to $1,072,559 as compared to $794,840 for the six months ended June 30, 2017. This was primarily due to the increase in officer compensation. The net loss for the six months ended June 30, 2018 was $929,995 as compared to a net income of $1,887,552 for the six months ended June 30, 2017. This difference is primarily due to the change in fair value of derivative, which created a non-cash gain for the six months ended June 30, 2017 of $4,015,061.

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Liquidity and Capital Resources

Historically, our primary source of liquidity has been from the issuances of debt financing. The primary uses of cash are payroll related expenses and professional fees.

Our balance sheet as of June 30, 2018 reflects $185,063 in cash. As of August 10, 2018, the Company had approximately $60,000 in cash.

Management is continuing to pursue financing from various sources, including private placements from investors and institutions. We do not have capital to satisfy our estimated working capital needs for the next 12 months. Moreover, as of June 30, 2018 we owe $1,826,579 in principal on convertible notes due in April 2019. Because of the uncertainty regarding the cryptocurrency business costs as well as the sums we owe our principal lenders, we cannot predict, with certainty, the outcome of our actions to generate liquidity, including the availability of additional debt financing, or whether such actions would generate enough liquidity. At this time, our Company does not have a commitment from any party to provide additional financing. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable. Any financing will be extremely dilutive to our common shareholders. If we cannot obtain financing, we will cease operations.

Going Concern

The Company has incurred losses since inception and requires additional funds for future operating activities. The Company’s selling activity has not reached a level of revenue sufficient to fund its operating activities. These factors create an uncertainty as to how the Company will fund its operations and maintain sufficient cash flow to operate as a going concern. The combination of these factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

Critical Accounting Policies and Estimates

Our financial statements and accompanying notes have been prepared in accordance with GAAP applied on a consistent basis. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 (the “Exchange Act”) and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of June 30, 2018.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.

15

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, the Company may become subject to various legal proceedings that are incidental to the ordinary conduct of its business. Although the Company cannot accurately predict the amount of any liability that may ultimately arise with respect to any of these matters, it makes provision for potential liabilities when it deems them probable and reasonably estimable. These provisions are based on current information and legal advice and may be adjusted from time to time according to developments.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

ITEM 2. RECENT UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

We have previously disclosed all sales of securities without registration under the Securities Act of 1933 except for the following:

Between May 12, 2018 and July 17, 2018, the Company issued 26,242,000 shares of common stock for the conversion of 26,242 shares of Series E. The common stock was issued pursuant to an exemption under Section 3(a)(9) of the Securities Act of 1933.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

ITEM 4. MINE SAFETY DISCLOSURES

N/A.

ITEM 5. OTHER INFORMATION

None.

16

ITEM 6. EXHIBITS

EXHIBIT INDEX

		Incorporated by Reference			Filed or Furnished
Exhibit #	Exhibit Description	Form	Date	Number	Herewith
2.1	Agreement and Plan of Merger**	8-K	9/13/16	2.1
2.2	Articles of Merger - Nevada	8-K	9/13/16	2.2
2.3	Statement of Merger - Arizona	8-K	9/13/16	2.3
3.1	Articles of Incorporation, as amended	S-1	2/8/17	3.1
3.2	Bylaws, as amended	S-1	2/8/17	3.2
4.1	Certificate of Designation of Series E Convertible Preferred Stock of TimefireVR Inc.	8-K	1/4/18	3.1
4.2	Amendment No. 1 to the Certificate of Designations of Series E Convertible Preferred Stock of TimefireVR Inc.	8-K	1/4/18	3.2
10.1	Form of Senior Secured Promissory Note	8-K	1/4/18	4.1
10.2	Form of Warrant dated March 6, 2018	8-K	3/7/18	10.3
10.3	Form of Securities Purchase Agreement	8-K	3/7/18	10.1
10.4	Form of Senior Secured Convertible Note	8-K	3/7/18	10.2
10.5	Form of Exchange Agreement**	8-K	1/4/18	10.1
10.6	Form of Membership Interest Purchase Agreement**	8-K	1/4/18	10.2
10.7	2016 Equity Incentive Plan, as amended	10-K	4/9/18	10.14
10.8	Form of Non-Qualified Stock Option Agreement	10-Q	8/21/17	10.1
10.9	Form of Note	8-K	8/7/18	10.1
10.10	Advisor Agreement dated March 16, 2018				Filed
31.1	Certification of Principal Executive Officer (302)				Filed
31.2	Certification of Principal Financial Officer (302)				Filed
32.1	Certification of Principal Executive and Principal Financial Officer (906)				Furnished*
101.INS	XBRL Instance Document				Filed
101.SCH	XBRL Taxonomy Extension Schema Document				Filed
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document				Filed
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document				Filed
101.LAB	XBRL Taxonomy Extension Label Linkbase Document				Filed
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document				Filed

———————

*	This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.
**	Certain schedules, appendices and exhibits to this agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission staff upon request.

Copies of this report (including the financial statements) and any of the exhibits referred to above will be furnished at no cost to our shareholders who make a written request to TimefireVR Inc., at the address on the cover page of this report, Attention: Corporate Secretary.

17

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, hereunto duly authorized, this 14th day of August, 2018.

TimefireVR Inc.
Signature	Title
/s/ Jonathan Read	Chief Executive Officer and Director
Jonathan Read
Signature	Title
/s/ Jessica L. Smith	Chief Accounting and Financial Officer
Jessica L. Smith

18

EX-10.10

Exhibit 10.10

ADVISOR AGREEMENT

This Advisor Agreement (this “Agreement”), is made effective as of March 16, 2018 (the “Effective Date”) by and between TimefireVR Inc., a Nevada corporation (the “Company”) and ICO Media Group Inc. (the “Advisor”).

WHEREAS, the Company desires to engage David Drake (“Drake”) as an independent contractor, to serve as a member of the Company’s advisory board and perform services on behalf of the Advisor and the Advisor desires to perform such services for the Company in accordance with the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in this Agreement, the parties hereto hereby agree as follows:

1.Advisory Services. Drake shall be appointed to the Company’s advisory board, which reports directly to the Company’s board of directors, and the Advisor and Drake shall render the services set forth on Exhibit A (the “Advisory Services”) to the Company, and the Company agrees to pay the Advisor the compensation described in Exhibit A for the Advisor’s performance of the Advisory Services to the Company for the term of this Agreement. The Company shall cooperate with the Advisor and provide such access to its information and property as may be reasonably required in order to permit the Advisor and its employees to perform their obligations under this Agreement, subject to customary confidentiality provisions.

2.Term. This Agreement shall continue until terminated in accordance with the provisions of Section 14. The Advisor’s obligations set forth in Sections 4 through 16, inclusive, shall survive termination of this Agreement.

3.Reimbursement of Expenses. Promptly but no later than ten (10) days following submission of statements of expenses incurred accompanied by appropriate supporting documentation, the Company will reimburse the Advisor for reasonable and customary out-of-pocket business expenses incurred by the Advisor in the ordinary course of performing the Advisory Services and in compliance with the Company’s policies covering such expenses. Anticipated expenses in excess of $500 will require the prior written approval of the Company.

4.Prior Work. The Advisor hereby assigns to the Company all of the Advisor’s right, title and interest in and to all previous work done by the Advisor for the Company relating to the Advisory Services.

5.Proprietary Information. This Agreement creates a relationship of confidence and trust between the Company and the Advisor with respect to any information: (a) applicable to the business of the Company or (b) applicable to the business of any client or customer of the Company, which may be made known to the Advisor by the Company or by any client or customer of the Company, or learned by the Advisor during the term of this Agreement while rendering the Advisory Services. All such information, whether provided prior to, on or after the Effective Date, has commercial value in the business in which the Company is engaged and is hereinafter called “Proprietary Information”. By way of illustration, but not limitation, Proprietary Information includes any and all technical and nontechnical information including trade secrets, patent, copyright, trade secret, and proprietary information, techniques, sketches, drawings, models, inventions, knowhow, processes, apparatus, equipment, algorithms, software programs, software source documents, and formulae related to the current, future and proposed products and services of the Company and includes, without limitation, information concerning research, experimental work, development, design details and specifications, engineering, financial information, procurement requirements, purchasing, manufacturing, customer lists, business forecasts, sales and merchandising and marketing plans and information. “Proprietary Information” also includes proprietary or confidential information of any third party who may disclose such information to the Company or to the Advisor in the course of the Company’s business. “Proprietary Information” shall not include information that (i) is or becomes known to the general public under circumstances involving no breach by the Advisor or others of the terms of this Agreement, (ii) is generally disclosed to third parties by the Company without restriction on such third parties, (iii) is in the rightful possession of the Advisor, without confidentiality obligations, at the time of disclosure by Company as shown by the Advisor’s then-contemporaneous written records, (iv) is independently developed or acquired by the Advisor or any of its representatives without violation of this Agreement, or (v) is approved in writing for release by the Company. C) The Advisor shall require all personnel to sign a Non-disclosure Agreement (see Exhibit B), protecting Company’s confidential information and intellectual property. Drake and the Advisor shall treat and obligate all personnel to treat as secret all confidential information received from Company including, but not limited to, information concerning the Company’s financial data, operating data, source code, or trade secrets encountered during this Agreement.

6.Ownership and Nondisclosure of Proprietary Information.

(a)All Proprietary Information is the sole property of the Company and the Company’s assigns and the Company and the Company’s assigns shall be the sole and exclusive owner of all trade secrets, patents, copyrights, mask works, trade secrets and other rights in the Proprietary Information. At all times, both during the term of this Agreement and after termination of this Agreement, Drake and the Advisor shall keep in confidence and trust all Proprietary Information and will not disclose any Proprietary Information to any person or entity other than the Company or use any Proprietary Information other than in connection with the Advisor’s performance of the Advisory Services for the benefit of the Company, in each case, without the prior written consent of the Company.

(b)Notwithstanding anything set forth herein to the contrary, the Company understands that the Advisor maintains a large staff devoted to developing its own products, services, designs, marketing strategies, business methods and the like, and is conducting research and evaluating ideas in many areas of interest, including on behalf of other companies and businesses, some of which may be in the same business as the Company. It is quite possible that the Advisor has already conceived of, or is expecting to work on a project involving, the same or similar information to the one provided or to be provided hereunder. Nothing in this Agreement shall be construed to prevent the Advisor from engaging independently in such activities, provided that the Proprietary Information of the Company is not used for such purposes.

7.Ownership and Return of Material. All materials (including, without limitation,

documents, drawings, models, apparatus, sketches, designs, lists, user stories, source code and all other tangible media of expression) furnished to Drake or the Advisor by the Company as a result of, or in connection with the Advisory Services shall remain the property of the Company. Upon termination of this Agreement, or at any time on the request of the Company before termination, Drake and the Advisor agrees to promptly (but no later than five (5) days after the earlier of the termination of this Agreement or the Company’s request) destroy or deliver to the Company, at the Company’s option, all materials furnished to either of them by the Company and all tangible media of expression which are in their possession and which incorporate any Proprietary Information or otherwise relate to the Company’s business. At the Company’s request, Drake and the Advisor shall provide the Company with written certification of their compliance with Advisor’s obligations under this Section.

8.Innovations. As used in this Agreement, the term “Innovations” means all information fixed in any tangible medium of expression (whether or not protectable under copyright laws), know-how, improvements, inventions (whether or not protectable under patent laws), works of authorship, techniques, software, code, objects, development tools, methods and protocols, instructions and routines, comments, user interfaces, support logs, scripts, design notes, supporting technical and user documentation, discoveries, data, ideas (whether or not protectable under trade secret laws), specifications, designs, trade secrets, combinations, formulae, developments, artwork, copyrights, regulatory and other governmental filings, documents, descriptions, processes, methods, procedures, trademarks, trade names, service marks, domain names, web addresses and web sites, all other subject matter that may be protectable under any patent, copyright, moral right, mask work, trademark, trade secret or other laws and all goodwill associated with any of the foregoing and any registrations and applications therefor.

9.Assignment of Innovations. Drake and the Advisor hereby agree to promptly disclose and describe to the Company and Drake and the Advisor hereby assign to the Company all of their right, title, and interest in and to each of the Innovations and all associated intellectual property rights that either party conceives, reduces to practice, creates, derives, develops or makes solely arising out of, or in connection with the work performed by Drake and/or the Advisor in rendering the Advisory Services and that (a) relate to the Company’s business or actual or demonstrably anticipated research or development, (b) was developed with the use of any of the Company’s equipment, supplies, facilities or trade secret information or (c) results from any work either party performed for the Company including the Advisory Services (collectively, the “Company Innovations”). Drake and the Advisor further acknowledge and agree that all Company Innovations including, without limitation, any computer programs, programming documentation, and other works of authorship, are “works made for hire” for purposes of the Company’s rights under copyright laws and they hereby assign to the Company any and all rights, title and interest they may have or acquire in such Company Innovations. Any assignment of copyright hereunder includes all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as “moral rights”. Without the prior written consent of the Company, Drake and the Advisor will not (i) use any Innovation or other proprietary right or information of Advisor or any third party in connection with the performance of the Advisory Services or (ii) incorporate any Innovation or other proprietary right or information of Drake, the Advisor or any third party into any of the Company Innovations or any of the Company’s products or any of the deliverables or work products provided to the Company. For the avoidance of doubt, any Inventions that Drake or the Advisor may conceive, reduce to practice, create, derive, develop or make, solely or jointly with others, without the use of any Proprietary Information of the Company or that do not arise of the work performed by Drake or the Advisor for the Company while rendering the Advisory Services shall remain the sole property of Drake or the Advisor and are not assigned to the Company.

10.Cooperation in Perfecting Rights to Proprietary Information and Innovations. Drake and the Advisor hereby agree to perform, during and after the term of this Agreement, all acts deemed necessary or desirable by the Company to permit and assist the Company, at the Company’s expense, in obtaining and enforcing the full benefits, enjoyment, rights and title throughout the world in the Proprietary Information and Company Innovations. Such acts may include, but are not limited to, execution of documents and assistance or cooperation (a) in the filing, prosecution, registration, memorialization and assignment of any applicable patent, copyright, mask work or other property right protection, (b) in the enforcement or defense of any applicable patent, copyright, mask work or other property right and (c) in any other legal proceedings. In the event that the Company is unable for any reason to secure Drake or the Advisor’s signature to any document required to file, prosecute, register, memorialize or assign any patent, copyright, mask work or other property right or to enforce any patent, copyright, mask work or other property related to the Proprietary Information or the Company Innovations, Drake and the Advisor hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as their agents and attorneys in fact to act for and on their behalf and instead of Drake or the Advisor (i) to execute, file, prosecute, register, memorialize and assign any such patent, copyright, mask work or other property right, (ii) to execute and file any documentation required for such enforcement and (iii) to do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization, assignment, issuance and enforcement of patents, copyrights, mask works and other rights related to the Proprietary Information or the Company Innovations, all with the same legal force and effect as if executed by Drake or the Advisor. The power of attorney provided under this Section 10 is coupled with an interest and is irrevocable.

11.Independent Contractor.

(a)Drake and the Advisor shall act in the capacity of an independent contractor with respect to the Company, and not as an employee or authorized agent or representative of the Company. Drake and the Advisor shall not have any authority to enter into contracts or binding commitments in the name or on behalf of the Company. The parties will not use each other’s logo or marks without prior written approval, and then such use shall be only for the benefit of the party which owns the logo or mark and at the direction of such party. Drake and the Advisor shall not be, nor represent himself as being, authorized to bind the Company.

(b)Drake and the Advisor agree, acknowledge and understand that neither party shall have the status of an employee of the Company and shall participate in any employee benefit plans or group insurance plans or programs (including, but not limited to, salary, bonus or incentive plans, stock option or purchase plans, or plans pertaining to retirement, deferred savings, disability, medical or dental) even if either party is considered eligible to participate pursuant to the terms of such plans, unless otherwise agreed to by the parties. In addition, Drake and the Advisor understand and agree that consistent with their independent contractor status, each party will not apply for any government-sponsored benefits intended only for employees, including, but not limited to, unemployment benefits.

(c) The Company shall issue Form 1099 records for its payments to Advisor made pursuant to this Agreement. Because Advisor is an independent contractor, Advisor is solely responsible for all taxes, withholdings, and other similar statutory obligations; and Advisor agrees to defend, indemnify and hold the Company harmless from any and all claims made by any taxing authority on account of an alleged failure by Advisor to satisfy any such tax or withholding obligations related to Advisor’s independent contractor status. Advisor warrants that Advisor has had the opportunity to obtain independent advice regarding the tax consequences of the payments made pursuant to this Agreement. Drake acknowledges he is sharing with the Advisor any fees payable to the Advisor in accordance with a separate agreement.

12. Representations, Warranties and Covenants.

12.1 Drake and the Advisor agree, represent and warrant that:

(a) All action necessary for the authorization, execution, delivery and performance of all obligations under this Agreement has been taken and this Agreement constitutes a valid and legally binding obligation of Drake and the Advisor that is enforceable against each party in accordance with its terms. To their knowledge, the authorization, execution and delivery by Drake and the Advisor of this Agreement and the performance of their obligations under this Agreement will not, with or without the passage of time or giving of notice (i) conflict with, or result in any violation of or default or loss of any benefit under, any permit, law, rule or regulation, or any judgment, decree or order of any court or other governmental agency or instrumentality to which Drake or the Advisor is a party or to which any of Drake or the Advisor’s property is subject or (ii) conflict with, or result in a breach or violation of or default or loss of any benefit under, the terms of any agreement, contract, indenture or other instrument to which Drake or the Advisor is a party or to which any of their property is subject, or constitute a default or loss of any right thereunder or an event that, with the lapse of time or notice or both, might result in a default or loss of any right thereunder. Drake and the Advisor’s performance of their obligations under this Agreement will not infringe upon or violate any right of any person or entity.

(b)During the term of this Agreement, Drake and the Advisor shall not be bound by any agreement, nor assume any obligation, which would conflict with the provisions of this Agreement.

(c)In performing the Advisory Services, Drake and the Advisor will not use any confidential or proprietary information of any other person or entity or infringe the intellectual property rights (including, without limitation, patent, copyright, trademark or trade secret rights) of any other person or entity nor will Drake or the Advisor disclose to the Company, or bring onto the Company’s premises, or induce the Company to use any confidential information of any other person or entity.

(d)Drake and the Advisor will abide by all applicable laws and the Company’s safety rules in the course of performing the Advisory Services. Drake and the Advisor have, and shall maintain, all licenses and permits necessary to perform the Advisory Services under this Agreement and all of such licenses are, and shall remain, in full force and effect.

(e)Drake and the Advisor will not subcontract any of their obligations under this Agreement without the prior written consent of the Company.

12.2 The Company agrees, represents and warrants that:

(a)All action necessary for the authorization, execution, delivery and performance of all obligations under this Agreement has been taken and this Agreement constitutes a valid and legally binding obligation of the Company that is enforceable against the Company in accordance with its terms.

(b)During the term of this Agreement, the Company shall not be bound by any agreement, nor assume any obligation, which would conflict with the provisions of this Agreement.

(c)The Company shall not use any confidential or proprietary information of any other person or entity or infringe the intellectual property rights (including, without limitation, patent, copyright, trademark or trade secret rights) of any other person or entity nor will the Company disclose to the Advisor, or induce the Advisor to use any confidential information of any other person or entity.

13.Indemnification. Drake and the Advisor will defend, indemnify and hold the Company and its affiliates harmless against any and all losses, liabilities, damages, claims, demands, suits, costs and expenses (including, without limitation, reasonable attorneys’ fees and court costs) arising or resulting, directly or indirectly, from any act or omission of Drake or the Advisor that constitutes a breach of any term or condition of this Agreement.

14.Termination. This Agreement may be terminated by the Company or Drake and the Advisor without cause upon at least thirty (30) days prior written notice to the other party. Any such termination without cause shall not result in forfeiture by Drake and the Advisor of any compensation paid prior to the date of termination. Upon the occurrence of any of the following events (as determined in the sole discretion of the Company), the Company may terminate this Agreement immediately upon delivery of written notice to Drake and the Advisor, which shall be considered a “for cause” termination: (i) the engagement by Drake or the Advisor in any conduct which constitutes gross negligence, willful misconduct or any other conduct which is demonstrably and materially injurious to the Company, whether monetary or otherwise; (ii) the commission by either party of any felony, act of fraud or dishonesty involving the Company or its business or which materially impairs their ability to perform their duties for the Company, (iii) the violation of any federal or state securities laws or rules, or (iv) the filing by the Securities and Exchange Commission or any state securities regulator which shall include the New York Attorney General . Upon termination for cause, Drake or the Advisor shall not be entitled to any compensation of any kind subsequent to the date of termination.

15.Non-Solicitation.

(a)Drake and the Advisor acknowledge that, in the course of their engagement with the Company, each has become familiar, or will become familiar, with trade secrets and with other Proprietary Information concerning the Company and that the services have been and will be of special, unique and extraordinary value to the Company. Drake and the Advisor understands that the following restrictions may limit their ability to earn a livelihood in a business similar to the business of the Company, but they nevertheless believe that they will receive sufficient consideration and other benefits as an Advisor of the Company and as otherwise provided hereunder to clearly justify such restrictions which, in any event (given the education, skills and ability, as applicable), Drake and the Advisor dos not believe would prevent them from otherwise earning a living or meeting their monetary obligations. Drake and the Advisor further understand that the provisions of this Agreement are reasonable and necessary to preserve the business of the Company.

(b)In light of Section 15(a), while Drake and the Advisor are engaged by the Company and for twelve (12) months thereafter, they shall not directly or indirectly through another person or entity: (i) induce or attempt to induce any employee or independent contractor of the Company to leave the employ of or engagement with the Company, or in any way interfere with the relationship between the Company, on the one hand, and any employee or independent contractor thereof, on the other hand; or (ii) induce or attempt to induce any actual or potential customer, supplier, independent contractor, licensee or other business relation of the Company to cease doing business with the Company, or in any way interfere with the relationship between any such customer, supplier, independent contractor, licensee or business relation, on the one hand, and the Company, on the other hand.

(c)Drake shall, if required by a subsequent employer, inform any prospective or future employer of any and all restrictions contained in this Agreement and provide such employer with a copy of such restrictions (but no other terms of this Agreement), prior to the commencement of that employment.

(d)If, at the time of enforcement of this Section 15, a court holds that the restrictions stated herein are unreasonable under the circumstances then existing, Drake, the Advisor and the Company agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area so as to protect the Company to the greatest extent possible under applicable law from improper competition.

(e)In the event of any breach or violation by Drake or the Advisor of any of the restrictions contained in this Section 15, any time period specified herein shall abate during the time of any such breach or violation thereof and that portion remaining at the time of commencement of any such breach or violation shall not begin to run until such breach or violation has been cured in all respects.

16.Miscellaneous Provisions.

(a)THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF ARIZONA WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICTING PROVISION OR RULE (WHETHER CONNECTICUT OR ANY OTHER JURISDICTION), THAT WOULD CAUSE THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF CONNECTICUT TO BE APPLIED. The Company, Drake and the Advisor hereby irrevocably and unconditionally submit, for themselves and their property, to the exclusive jurisdiction of any State of Arizona court or federal court in Maricopa County, Arizona and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or for recognition or enforcement of any judgment, and the Company, Drake and the Advisor hereby irrevocably and unconditionally agree that all claims in respect of any such action or proceeding may be heard and determined in any such State of Arizona court or, to the extent permitted by law, in such federal court. The Company and the Advisor irrevocably waive, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. The Company, Drake and the Advisor agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. The Company, Drake and the Advisor irrevocably and unconditionally waive, to the fullest extent they may legally and effectively do so, any objection that they may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any Maricopa County, Arizona state or federal court and any appellate court of such court. Notwithstanding the foregoing, the parties intend to and hereby confer jurisdiction to enforce the covenants contained in Section 16 upon the courts of any jurisdiction within the geographical scope of such covenants. If the courts of any one or more of such jurisdictions hold such covenants wholly or partially invalid or unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the parties that such determination not bar or in any way affect the Company’s right to the relief provided above in the courts of any other jurisdiction within the geographical scope of such covenants, as to breaches of such covenants in such other respective jurisdictions, such covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

(b)It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

(c)This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, successors and permitted assigns; provided, however, that the rights and obligations of the parties hereto are not assignable without the other party’s prior written consent. Any assignment made in violation hereof shall be null and void and of no force or effect.

(d)All notices, consents, waivers or other communications given under this Agreement shall be in writing and given by overnight delivery (by a nationally recognized overnight courier service), personal delivery or by email, at the respective addresses of the parties as set forth below their signatures hereto or at the most current address as may be supplied by such party to the other pursuant to this Section. Such notices, if sent by overnight delivery, shall be deemed to have been given one day after being sent. Such notices, if delivered in person, shall be deemed to have been given upon receipt by the other party.

(e) This Agreement contains the entire understanding of the parties regarding its subject matter and supersedes all prior understandings or agreements between the parties with regard to its subject matter. This Agreement can only be modified by a subsequent written agreement executed by both parties hereto.

(f)This Agreement may be executed in counterparts, each of which will be considered an original, but all of which together will constitute the same instrument.

(g)Because Drake and the Advisor’s services are unique and because Drake and the Advisor has access to Proprietary Information, the parties hereto agree that monetary damages alone would be an inadequate remedy for any breach of this Agreement. Therefore, in the event of a breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor at law or in equity, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, such provisions (without posting a bond or other security or plead or prove a lack of irreparable harm or adequate remedy at law) or require Drake or the Advisor to account for and pay over to the Company all compensation, profits, moneys, accruals, increments or other benefits derived from or received as a result of any breach of this Agreement. The rights and remedies of the Company under this Agreement are not exclusive of or limited by any other rights or remedies which they may have, whether at law, in equity, by contract or otherwise, all of which shall be cumulative (and not alternative). Without limiting the generality of the foregoing, the rights and remedies of the Company under this Agreement, and the obligations and liabilities of Drake and the Advisor under this Agreement, are in addition to their respective rights, remedies, obligations and liabilities under the law of unfair competition, under laws relating to misappropriation of trade secrets, under other laws and common law requirements and under all applicable rules and regulations. No failure on the part of any person or entity to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any person or entity in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy. No person or entity shall be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such person or entity; and any such waiver shall not be applicable or have any effect except in the specific instance in which it is given. IN NO EVENT SHALL DRAKE OR THE ADVISOR BE LIABLE TO THE COMPANY OR TO ANY OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, OR DAMAGES FOR LOST PROFITS OR LOSS OF BUSINESS, HOWEVER CAUSED AND UNDER ANY THEORY OF LIABILITY, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHER THEORY OF LIABILITY, REGARDLESS OF WHETHER ADVISOR WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY. IN NO EVENT SHALL DRAKE OR THE ADVISOR’S LIABILITY ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT EXCEED THE AMOUNTS PAID BY THE COMPANY TO ADVISOR UNDER THIS AGREEMENT FOR THE ADVISORY SERVICES, DELIVERABLES OR INVENTION GIVING RISE TO SUCH LIABILITY.

(h)WAIVER OF JURY TRIAL. NO PARTY TO THIS AGREEMENT OR ANY ASSIGNEE, SUCCESSOR, HEIR OR PERSONAL REPRESENTATIVE OF A PARTY SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER AGREEMENTS OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES. NO PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS SECTION HAVE BEEN FULLY DISCUSSED BY THE PARTIES HERETO, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NEITHER PARTY HAS IN ANY WAY AGREED WITH OR REPRESENTED TO THE OTHER PARTY THAT THE PROVISIONS OF THIS SECTION WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.

[Signature Page Follows]

IN WITNESS WHEREOF, this Advisor Agreement is entered into as of the Effective Date.

“COMPANY”	“ADVISOR”
TimefireVR Inc.	David Drake
	Signed: ______________________
Signed: ______________________
Name: Jonathan Read
Title: Chief Executive Officer
	Signed: ______________________
	Michael Woloshin
	CEO
	ICO Media Group Inc.

EXHIBIT A

SERVICES AND COMPENSATION

Services.

Drake and the Advisor will assist Timefire VR Inc. in the implementation and execution business model in assisting and setting up a Crypto Mining operation and bringing in other valued added projects in the crypto space including Joint Ventures, Potential Acquisitions and other opportunities. Drake shall devote at least three business days per month to assisting the Company under this Agreement.

Compensation.

Upon execution of this Agreement, the Advisor shall receive $200,000 worth of common stock of the Company which is equal to 6,666,666 shares of common stock at $0.03 cents per share (the “Shares”). The Shares shall be restricted under Rule 144. The Shares shall vest quarterly, with the first vesting date being three months from the Effective Date, subject to this Agreement having not been terminated and neither party having given notice in accordance with the provisions of Section 14 of this Agreement on each applicable vesting date. Provided, however, if the Company terminates without cause all shares shall vest upon the giving of notice of termination.The Advisor agrees to execute the Company’s standard investment letter prior to issuance of the Shares. The Company shall also issue the Advisor 6,666,666 three-year warrants (the “Warrants”) to purchase the Company’s common stock at $0.05 per share. The Warrants shall vest quarterly, with the first vesting date being three months from the Effective Date, subject to this Agreement having not been terminated and neither party having given notice in accordance with the provisions of Section 14 of this Agreement on each applicable vesting date.

If the Company has entered into mining of cryptocurrency within 90 days from the date of this Agreement, the Company will also grant ICO Media Group a 6% Royalty from any revenues the Company receives during the term from mining of cryptocurrency, calculated on a cash basis as follows:

Months 1-24 6%

Months 25-36 4%

Months 37-48 2%

Months 49-60 1%

The Company shall reimburse ICO Media Gropu $5,000 per month to pay for the services of an engineer to build out and operate the Company’s proposed cryptocurrency mining business. Ther engineer shall devote one-half of his time to the Company’s business.

EXHIBIT B

NON-DISCLOSURE AGREEMENT

See attached.

EX-31.1

Exhibit 31.1

 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Jonathan Read, certify that:

1. I have reviewed this quarterly report on Form 10-Q of TimefireVR Inc. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By: /s/ Jonathan Read          

Jonathan Read

Chief Executive Officer

(Principal Executive Officer)

Date: August 14, 2018

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Jessica L. Smith, certify that:

1. I have reviewed this quarterly report on Form 10-Q of TimefireVR Inc. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By: /s/ Jessica L. Smith          

Jessica L. Smith

Chief Financial Officer

(Principal Financial Officer)

Date: August 14, 2018

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of TimefireVR Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2018, as filed with the Securities and Exchange Commission on the date hereof, I, Jonathan Read, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The quarterly report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and

2. The information contained in the quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By: /s/ Jonathan Read          

Jonathan Read

Chief Executive Officer

(Principal Executive Officer)

Date: August 14, 2018

In connection with the quarterly report of TimefireVR Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2018, as filed with the Securities and Exchange Commission on the date hereof, I, Jessica Smith, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The quarterly report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and

2. The information contained in the quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By: /s/ Jessica L. Smith          

Jessica L. Smith

Chief Financial Officer

(Principal Financial Officer)

Date: August 14, 2018

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 14, 2018
Document And Entity Information
Entity Registrant Name	TimefireVR Inc.
Entity Central Index Key	0000748268
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		235,460,470
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2018

XML

BALANCE SHEETS (Unaudited) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets:
Cash	$ 185,063	$ 559,237
Cryptocurrencies	53,418
Note receivable	120,000
Interest receivable	3,600
Accounts receivable	280	38
Prepaid expenses and other current assets	207,247	131,250
Total current assets	569,608	690,525
Other Assets:
Property and equipment, net	307,171	26,128
Deposit	459,648	33,500
Total Assets	1,336,427	750,153
Current Liabilities:
Accounts payable and accrued expenses	49,883	349,469
Demand obligation payable - related party		116,883
Convertible notes payable, net	1,789,152	1,564,814
Accrued interest	292,575	321,824
Short-term advance - related party		57,400
Total current liabilities	2,131,610	2,410,390
Long Term Liabilities:
Derivative liabilities	231,176	198,994
Total long term liabilities	231,176	198,994
Total liabilities	2,362,786	2,609,384
Commitments and Contingencies
Mezzanine Equity
Preferred Series A stock, par value $.01 per share, 134,000 shares authorized; 0 and 133,334 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively. Stated at redemption value.		1,500,004
Shareholders' Deficit:
Preferred Stock, par value $.01, 10,000,000 shares authorized all series	1,292	154
Obligation to issue common stock	1,000
Common stock, par value $.001 per share, 500,000,000 shares authorized; 228,460,470 and 47,269,804 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively	228,461	47,270
Additional paid-in capital	2,413,441	(666,101)
Accumulated deficit	(3,670,553)	(2,740,558)
Total shareholders' deficit	(1,026,359)	(3,359,235)
Total Liabilities and Shareholders' Deficit	$ 1,336,427	$ 750,153

XML

BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	129,190	15,425
Preferred stock, shares outstanding	129,190	15,425
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	228,460,470	47,269,804
Common stock, shares outstanding	228,460,470	27,269,804
Mezzanine Equity Preferred Series A stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	134,000	134,000
Preferred stock, shares issued		133,334
Preferred stock, shares outstanding		133,334
Preferred Series A-1 stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	21,000	21,000
Preferred stock, shares issued		14,923
Preferred stock, shares outstanding		14,923
Preferred Series B stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	300,000	300,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Preferred Series C stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares issued		502
Preferred stock, shares outstanding		502
Preferred Series E stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares issued	129,190
Preferred stock, shares outstanding	129,190

XML

STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Revenues	$ 8,917		$ 8,917
Cost of sales	56,003		56,871
Gross profit	(47,086)		(47,954)
Operating expenses:
Occupancy	2,283		5,378
Officer compensation	130,389		406,879	141,195
Professional fees	229,023	340,850	519,107	558,051
Other operating expenses	75,227	3,218	141,195	95,594
Total operating expenses	436,922	344,068	1,072,559	794,840
Loss from operations	(484,008)	(344,068)	(1,120,513)	(794,840)
Other income (expense):
Change in fair value of derivative liabilities	106,912	1,391,883	(162,016)	4,015,061
Gain/(loss) in fair value of cryptocurrencies	1,517		(55,083)
Interest income	1,909		3,750
Interest expense	(104,247)	(97,125)	(266,381)	(128,616)
Total other income (expense)	6,091	1,294,758	(479,730)	3,886,445
Income (loss) from continuing operations	(477,917)	950,690	(1,600,243)	3,091,605
Gain on disposal of Timefire, LLC			670,428
Loss from discontinued operations		(491,830)	(180)	(1,204,053)
Income (loss) from discontinued operations		(491,830)	670,248	(1,204,053)
Income tax expense
Net income (loss)	$ (477,917)	$ 458,860	$ (929,995)	$ 1,887,552
Basic net income (loss) per common share	$ (0.00)	$ 0.01	$ (0.01)	$ 0.04
Diluted net income (loss) per common share	$ (0.00)	$ 0.01	$ (0.01)	$ 0.03
Basic weighted average common shares outstanding	201,582,049	46,245,375	158,123,082	45,558,859
Diluted weighted average common shares outstanding	201,582,049	69,461,003	158,123,082	68,774,487

XML

STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Operating Activites:
Net income (loss) from continuing operations	$ (1,600,243)	$ 3,091,605
Net income (loss) from discontinued operations	670,248	(1,204,053)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	21,134	6,303
Common stock issued for services	228,233	242,500
Warrants and options issued for services	464,834	338,334
Change in derivative liabilities	162,016	(4,015,061)
Net cryptocurrencies received in lieu of cash	(8,501)
Loss in fair value of cryptocurrencies	55,083
Restricted stock units issued for services		128,693
Interest expense from amortization of debt discount	37,496	24,456
Gain on sale of subsidiary	(670,428)
Changes in operating assets and liabilities:
Accounts receivable	(280)	(341)
Interest receivable	229,066	119,603
Prepaid expenses and other current assets	(75,997)	(64,205)
Escrow fund		71,546
Deposits	(459,648)	78,000
Accrued interest	229,066	119,603
Accounts payable and accrued expenses	(94,777)	254,904
Net Cash Used in Operating Activities	(1,045,364)	(927,716)
Investing Activities:
Purchases of property and equipment	(328,305)
Proceeds from sale of subsidiary net of subsidiary cash	99,495
Purchases of cryptocurrency	(100,000)
Net Cash Used in Investing Activities	(328,810)
Financing Activities:
Net proceeds from convertible notes payable	1,000,000	617,500
Net proceeds from convertible notes payable - related party		95,000
Net Cash Provided by Financing Activities	1,000,000	712,500
Net Increase in Cash	(374,174)	(215,216)
Cash - Beginning of Period	559,237	225,379
Cash - End of Period	185,063	10,163
Supplemental disclosure of non-cash investing and financing activities:
Issuance of Series E Preferred for Series A, A-1 and C Preferred and warrants	1,629,992
Issuance of Series E Preferred for convertible debt and accrued interest	939,966
Conversion of Series E Preferred stock to common stock	174,724
Conversion of Series C Preferred stock to common stock		1,130
Conversion of Series A-1 Preferred stock to common stock		545
Note receivable from sale of subsidiary	120,000
Supplemental disclosure of cash flow information:
Interest paid in cash		135
Income taxes paid in cash

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Statement of Cash Flows [Abstract]
Conversion of Series A-1 Preferred stock to common stock		$ 545

XML

Summary of Significant Accounting Policies and Use of Estimates

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Summary of Significant Accounting Policies and Use of Estimates

1. Summary of Significant Accounting Policies and Use of Estimates

Basis of Presentation and Organization and Reorganization

Effective September 13, 2016, TimefireVR Inc., a Nevada corporation (“Timefire,” “we,” “us,” “our” or the “Company”) entered into an Agreement and Plan of Merger (“Merger Agreement” or the “Merger”) through which it acquired Timefire LLC, a Phoenix-based virtual reality content developer and Arizona Limited Liability Company (“TLLC”). As consideration for the Merger, the Company issued the equity holders of TLLC a total of 41,400,000 shares of its common stock, and 2,800,000 five-year warrants exercisable at $0.58 per share for 100% of the membership interests of TLLC. As a result, the former members of TLLC owned approximately 99% of the then outstanding shares of common stock.

On January 3, 2018, the Company entered into a Membership Interest Purchase Agreement (the “Agreement”) by and between the Company and Mitchell Saltz (“Saltz”). Pursuant to the terms of the Agreement, Saltz acquired all the membership interests of the Company’s subsidiary, Timefire LLC (“TLLC”).

In consideration for entering in the Agreement, the Company received: (i) $100,000 in cash and (ii) a secured (by all the tangible and intangible property of TLLC) promissory note in the principal amount of $120,000 bearing 6% annual interest maturing on September 28, 2018. Additionally, Saltz or TLLC assumed certain of the Company’s liabilities including a sublease agreement entered into by the Company, loans made by Saltz to the Company, a certain $100,000 senior convertible note of the Company dated March 3, 2017, a certain services agreement entered into by the Company, certain past compensation owed to the Company’s former executive officers, and certain credit card debts owed by the Company.

On January 3, 2018, the Company purchased $100,000 of ether, the cryptocurrency offered by the Ethereum network. This purchase was the Company’s first material cryptocurrency purchase and signified the start of the Company’s entry into the cryptocurrency business. The Company records its cryptocurrency holdings at fair value as of valuation date. The Company recorded net loss on fair value of its cryptocurrency holdings of $55,083 for the six months ended June 30, 2018.

Unaudited Interim Financial Statements

The interim financial statements of the Company as of June 30, 2018 and 2017, and for the periods then ended, are prepared in accordance with the instructions to Form 10-Q. Accordingly, the accompanying financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States of America (“U.S. GAAP”). However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company’s financial position as of June 30, 2018 and the results of its operations and its cash flows for the periods ended June 30, 2018 and 2017. These results are not necessarily indicative of the results expected for the year ended December 31, 2018. The financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2017, filed with the U.S. Securities and Exchange Commission (the “SEC”) on April 9, 2018. The balance sheet as of December 31, 2017 has been derived from the audited financial statements included in that filing.

Principles of Consolidation

For accounting purposes, the Merger transaction was recorded as a reverse recapitalization, with TLLC as the accounting acquirer. Consequently, the historical pre-Merger financial statements of TLLC were then those of the Company. The financial statements for periods December 31, 2017 and prior include the accounts of the Company and TLLC. All significant intercompany transactions and balances have been eliminated. Equity investments through which we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee's activities are accounted for using the equity method where applicable.

Reclassifications

For the three and six months ended June 30, 2017, the Company’s Statement of Operations and Cash Flows have been reclassified to the current presentation to reflect the discontinued operations resulting from the sale of TLLC. The reclassified financial statement items had no effect on net income for the periods.

Discontinued Operations

The Company has classified the operating results related to the TLLC virtual reality business, which was sold on January 3, 2018, as discontinued operations in the financial statements. As per SEC guidelines, the December 31, 2017 balance sheet has not been retrospectively adjusted to reflect discontinued operations. Such adjustment will be reflected when the December 31, 2017 balance sheet is first presented with annual financial statements that report discontinued operations.

Discontinued operations consist of specifically identified expenses as follows:

TIMEFIREVR INC.
STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended					Six Months Ended
	June 30,		June 30,			June 30,			June 30,
	2018		2017			2018			2017
Revenues	$	—	$	488		$	—		$	488
Cost of sales		—		146			—			146
Gross profit		—		342			—			342
Operating expenses:
Research and development		—		344,001			—			792,892
Occupancy		—		20,135			—			43,342
Depreciation and amortization		—		3,151			—			6,303
Officer compensation		—		108,864			—			321,720
Professional fees		—		1,062			—			1,562
Other operating expenses		—		2,829			—			23,000
Total operating expenses		—		480,042			—			1,188,819
Loss from operations		—		(479,700	)		—			(1,188,477	)
Other income (expense):
Gain on disposal of Timefire, LLC		—		—			670,428			—
Interest income		—		—			—			2
Interest expense		—		(12,130	)		(180	)		(15,578	)
Total other income (expense)		—		(12,130	)		670,248			(15,576	)
Income (loss) from discontinued operations	$	—	$	(491,830	)	$	670,248		$	(1,204,053	)

Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates. Significant estimates of the Company include accounting for depreciation and amortization, derivative liabilities, accruals and contingencies, the fair value of the Company’s common stock and the estimated fair value of warrants.

Revenue Recognition

On January 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASC 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under U.S. GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation.

The Company is paid in cryptocurrency for its mining operations. The revenue generated is valued by the cryptocurrency fair value on the date earned.  

Cash and Cash Equivalents

The Company considers all highly liquid instruments, with original maturity of three months or less when purchased, to be cash equivalents. We place our cash and cash equivalents with major financial institutions. Such amounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”). From time to time, balances may exceed FDIC coverage limits.

Property and Equipment

Property and equipment is recorded at cost reduced by accumulated depreciation. Depreciation is provided for on the straight-line method, over the estimated useful lives of the assets. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Betterments or renewals are capitalized when incurred. Gains and losses on the disposition of property and equipment are recorded in the period incurred.

The estimated useful lives of property and equipment are:

· Office furniture and equipment   3-5 years

Impairment of Long-Lived Assets and Intangible Assets

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 360-10, "Property, Plant, and Equipment," which established a "primary asset" approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset and amortizable intangible asset to be held and used. Long-lived assets and amortizable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset and amortizable intangible asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Long-lived assets and amortizable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

Business Segments

ASC 280, "Segment Reporting" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment as of June 30, 2018.

Research and Development Costs

Research and development costs, including design, development and testing of software, are expensed as incurred.

Income Taxes

The Company accounts for income taxes under FASB ASC 740, Income Taxes. Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

Stock-Based Compensation

In accordance with ASC No. 718, Compensation – Stock Compensation (“ASC 718”), the Company measures the compensation costs of stock-based compensation arrangements based on the grant date fair value of granted instruments and recognizes the costs in the financial statements over the period during which such awards vest. Stock-based compensation arrangements include stock options and restricted stock awards.

Equity instruments (“Instruments”) issued to non-employees are recorded on the basis of the fair value of the Instruments, as required by ASC 718. ASC No. 505, Equity Based Payments to Non-Employees (“ASC 505”), defines the measurement date and recognition period for such Instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete and (ii) the Instruments are vested. The measured fair value related to the Instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in ASC 505.

Net Income (Loss) Per Share

Basic earnings per share does not include dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could share in the earnings of an entity. Dilutive securities are not included in the weighted average number of shares when inclusion would be anti-dilutive. As of June 30, 2018 and 2017, there were total shares of 192,232,724 and 23,215,628, respectively, issuable upon conversion of preferred stock, exercise of warrants and options.

Fair Value Measurements

ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in U.S. GAAP, and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2018. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, accounts payable and accrued expenses.

Derivative Liabilities

The Company issued common stock purchase warrants in September 2016 in conjunction with the Merger Agreement.  Additional warrants were issued in March and August 2017 as part of private placement offerings. Warrants were also issued in March 2018 as part of a private placement offering (see Note 5) and per an advisory agreement (see Note 7). In accordance with ASC No. 480, Distinguishing Liabilities from Equity (“ASC 480”), the fair value of these warrants is classified as a liability on the Company’s Balance Sheets because, according to the warrants' terms, a fundamental transaction could give rise to an obligation of the Company to pay cash to certain warrant holders. Corresponding changes in the fair value of the warrants are recognized as a gain or loss on the Company’s Statements of Operations in each subsequent period.

The fair value of the warrants at June 30, 2018 and December 31, 2017 was $231,176 and 198,994, respectively. The difference has been recorded as a change in change in fair value of derivatives.

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Going Concern

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern

2. Going Concern

The Company has incurred losses since inception and requires additional funds for future operating activities. The Company has not reached a level of revenue sufficient to fund its operating activities. These factors create an uncertainty as to how the Company will fund its operations and maintain sufficient cash flow to operate as a going concern. The combination of these factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in response to these factors include the issuances of debt in exchange for cash such as that which is described in Note 5, Convertible Notes Payable.

The Company’s ability to meet its cash requirements in the next year is dependent upon obtaining additional financing. If this is not achieved, the Company will be unable to obtain sufficient cash flow to fund its operations and obligations, and as a result there is substantial doubt the Company will be able to continue as a going concern. The accompanying financial statements have been prepared on a going concern basis, and accordingly, do not include any adjustments relating to the recoverability and classification of recorded asset amounts; nor do they include adjustments to the amounts and classification of liabilities that might be necessary should the Company be unable to continue operations or be required to sell its assets.

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Gain on Disposal of Timefire LLC

6 Months Ended

Jun. 30, 2018

Discontinued Operations and Disposal Groups [Abstract]

Gain on Disposal of Timefire LLC

3. Gain on Disposal of Timefire LLC

As discussed in Note 1, on January 3, 2018, the Company entered into the Agreement. Pursuant to the terms of the Agreement, Mr. Saltz acquired all the membership interests of TLLC.

In consideration for entering into the Agreement, the Company received: (i) $100,000 in cash and (ii) a secured promissory note in the principal amount of $120,000 bearing 6% annual interest that matures on September 28, 2018. Additionally, Mr. Saltz and TLLC each assumed certain of the Company’s liabilities including a sublease agreement entered into by the Company, loans made by Mr. Saltz to the Company, a certain $100,000 senior convertible note from the March 2017 Notes, as defined below, a certain services agreement entered into by the Company, certain past compensation owed to the Company’s former executive officers, and certain credit card debts owed by the Company. Total gross proceeds from the sale were $220,000, including the cash payment and secured promissory note, plus $510,599 in liabilities relieved, less $60,171 of assets sold to TLLC resulted in a gain on disposal of $670,428.

Assets sold:
Cash	(505	)
Property & equipment, net	(26,128	)
Accounts receivable	(38	)
Deposit	(33,500	)
	(60,171	)
Liabilities relieved:
Accounts payable & accrued expenses	204,809
Demand obligation payable - related party	116,883
Convertible notes payable	100,000
Accrued interest	31,507
Short-term advance - related party	57,400
	510,599
Additional consideration:
Note receivable	120,000
Cash	100,000
	220,000
Gain on disposal of Timefire, LLC	670,428

The gain on disposal is included in the income from discontinued operations on the profit and loss statement for the six months ended June 30, 2018.

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Cryptocurrencies

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Cryptocurrencies

4. Cryptocurrencies

On January 3, 2018, the Company purchased $100,000 of ether (106.95 units), the cryptocurrency offered by the Ethereum network. The fair value of such ether units on June 30, 2018 was $46,627 and the Company took a charge to operations of $53,364 in the six months ended June 30, 2018. That amount is included in gain/loss on the fair value of cryptocurrencies in the accompanying statement of operations.

In April 2018, the Company began its mining operations. The Company is paid in cryptocurrency for these operations. It started out mining Bitcoin and later, in June 2018, expanded into the mining of ether. The revenue generated is valued by the cryptocurrency fair value on the date earned. Such amounts aggregated $8,917 for the six months ended June 30, 2018. The fair value of the earned cryptocurrency is adjusted at quarter end, resulting in a charge to operations.

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Convertible Notes Payable

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Convertible Notes Payable

5. Convertible Notes Payable

On March 6, 2017, the Company closed on a private placement offering with institutional investors and one of the Company’s former directors pursuant to which the Company issued and sold the investors senior convertible notes (the “March 2017 Notes”) in the aggregate principal amount of $750,000, with an original issue discount of 5%, for gross proceeds to the Company of $712,500 prior to payment of $20,000 in reimbursement of legal fees of the lead investor. The March 2017 Notes had an original maturity date of September 3, 2017 with an initial interest rate of 8%, and a default interest rate of 18% which became effective as of the maturity date. On the maturity date, the Company was obligated to repay an amount equal to 120% of outstanding principal and accrued interest. On the maturity date (and subsequently, if the holders had elected to extend the maturity date), the investors had the right to convert the Notes into the common stock of the Company at $0.30 per share, subject to adjustment (the “Conversion Price”). As additional consideration, the Company issued the investors a total of 2,500,000 five-year warrants to purchase the Company’s common stock, which are exercisable on or after the maturity date at $0.35 per share. The Company failed to pay the March 2017 Notes on the maturity date, which date the investors did not elect to extend.

On August 18, 2017, the Company closed on an offering of convertible notes and warrants on terms substantially identical to the March 6, 2017 financing. The purchasers are the same investors as in the March 2017 Notes except for the former director who did not participate in this financing. The Company received $60,000 in net proceeds from the issuance of $63,158 of convertible notes (the “August 2017 Notes”). Additionally, the Company issued the investors a total of 210,526 five-year warrants exercisable at $.35 per share. The Company failed to pay the August 2017 Notes when due on September 3, 2017.

The March 2017 Notes and August 2017 Notes and accompanying warrants were converted on January 3, 2018 into Series E Preferred stock. See Note 8.

On October 27, 2017, the Company closed on an offering of convertible notes with two institutional investors in the principal amount of $70,000 (the “October 2017 Notes”). The October 2017 Notes matured on November 29, 2017 and bear interest at 8% per annum. On the maturity date, the Company was obligated to repay an amount equal to 120% of the outstanding principal and accrued interest. The investors may elect to convert the October 2017 Notes into common stock of the Company at $.03 per share. The Company failed to pay these October 2017 Notes when due.

On December 21, 2017, the Company closed on an offering with three institutional investors pursuant to which the Company issued and sold convertible notes in the aggregate principal amount of $703,947 (the “December 2017 Notes”). The December 2017 Notes had an original issue discount of 5%, for proceeds to the Company in the amount of $668,750. The notes matured on January 20, 2018, bear interest at 8%, and require the repayment of 120% of principal and accrued interest at maturity. The investors may elect to convert the December 2017 Notes into common stock of the Company at $.03 per share.

On March 6, 2018, the holders of the October 2017 Notes and December 2017 Notes agreed to extend the due date of these notes to April 15, 2019 as discussed below.

On March 6, 2018, the Company closed on a private placement offering with institutional investors pursuant to which the Company issued and sold Senior Secured Convertible Notes (the “2018 Notes”) to the Investors in the aggregate principal amount of $1,052,632 with an original issue discount of 5% and received gross proceeds of $1,000,000. The 2018 Notes mature on April 15, 2019 and bear interest at 8% per annum. The 2018 Notes are secured by a first lien on all of the assets of the Company. On the maturity date, the Company must repay an amount equal to 120% of the outstanding principal and accrued interest. Beginning on the six-month anniversary of the issuance of the 2018 Notes, the investors may elect to convert the 2018 Notes into common stock of the Company at $0.03 per share, subject to adjustment. In addition, the 2018 Notes are redeemable by the Company up to 90 days following issuance at an amount equal to 110% of outstanding principal and accrued interest, and thereafter at an amount equal to 120% of outstanding principal and accrued interest, subject in either case to upward adjustment to the extent the closing price of the Company’s common stock on the OTCQB exceeds the Conversion Price. As additional consideration, the Company issued the investors a total of 35,087,720 five-year warrants to purchase the Company’s common stock, which are exercisable on or after the six-month anniversary of the issuance at $0.06 per share. In addition, the Investors agreed to extend the due date of the October 2017 Notes and December 2017 Notes.

The aggregate principal amount of the above described notes is $1,826,579, which is shown in the accompanying balance sheet as of June 30, 2018, net of $37,427 debt discount, as convertible notes payable-net. Accrued interest amounted to $292,575 as of that date and interest expense aggregated $266,381 for the six months ended June 30, 2018.

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Related Party Transactions

6 Months Ended

Jun. 30, 2018

Related Party Transactions [Abstract]

Related Party Transactions

6. Related Party Transactions

On March 6, 2017, the Company issued one of the March 2017 Notes to a former director as an investor for $100,000. The Company’s obligation under the March 2017 Notes was cancelled on January 3, 2018 as described below.  

On June 2, 2017, the Company entered into an agreement with an entity managed by a former director of the Company to provide services to the entity. A retainer deposit of $57,400 was received, and services were to be initiated within sixty days. The Company’s obligation under this agreement was cancelled on January 3, 2018 as described below.

During the year ended December 31, 2017, the Company received advances totaling $116,883 from a related party, an original TLLC investor. These advances are not evidenced by a promissory note, and are non-interest bearing. The Company’s obligation to repay this amount was cancelled on January 3, 2018 as described below.

On January 3, 2018, the Company effected the sale of TLLC to a group of persons including TLLC’s former owners and two of the Company’s former executive officers and directors.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

7. Commitments and Contingencies

Employment Agreements

Effective September 13, 2016, the Company entered into an employment agreement with its former President, John Wise. The agreement was for a two year period at the rate of $150,000 per annum. The Company was in default on this agreement, and the payroll for this officer accrued from July 8, 2017 until his resignation in October 2017.

Effective September 13, 2016, the Company entered into an employment agreement with its former Chief Strategy Officer, who was later named Chief Executive Officer, Jeffrey Rassas. The Company was in default on this agreement, and the payroll for this officer accrued from May 16, 2017 until his resignation in October 2017.

Aggregate accrued payroll for these two former officers was approximately $106,000 as of December 31, 2017. These obligations were cancelled on January 3, 2018 as part of the sale of TLLC.

Effective January 3, 2018, the Company entered into an oral employment agreement (the “Read Agreement”) with the Company’s current Chief Executive Officer (the “CEO”), Jonathan Read. Under the terms of the Read Agreement the Company is paying Mr. Read an annual salary of $240,000 subject to his continued employment with the Company. Additionally, the Company paid Mr. Read compensation for his services as the Company’s CEO from October 20, 2017, to December 31, 2017, calculated as a pro-rata portion of an annual salary of $150,000. Additionally, on January 3, 2018 (the “Grant Date”) the Company’s Board of Directors (the “Board”) granted Mr. Read 15,000,000 stock options of which 5,000,000 vested on the Grant Date, 5,000,000 will vest one-year from the Grant Date, and 5,000,000 will vest two years from the Grant Date subject to continued employment with the Company.

Effective January 3, 2018, the Company agreed to compensate Gary Smith for his service as a non-employee director by paying him $2,500 per calendar quarter effective as of July 10, 2017.

Lease Agreements

On September 23, 2016, the Company entered into an office lease agreement commencing October 1, 2016.  This lease expires December 31, 2018.  As part of the sale of TLLC, the Company was released of this lease obligation as well as the rights to the security deposit. The Company has been renting an office space on a month-to-month basis, and incurred rent expense of approximately $5,400 during the six months ended June 30, 2018.

Other Agreements

On January 20, 2017, the Company entered into an agreement with a firm to provide their artificial intelligence conversational voice platform for integration into the Company’s product. Per the agreement, the Company issued 50,000 shares of common stock and was scheduled to make monthly payments towards a $127,500 integration fee. As of December 31, 2017, the Company had expensed $46,000, with $35,000 remaining in accounts payable. On January 3, 2018, the Company sold TLLC, and this payable, and any future obligations under this agreement, were relieved as part of this transaction.

On November 7, 2016, the Company entered into an agreement with a firm to provide general advisory and business development advisory services for a fee of $75,000. The Company remitted $75,000, but the contract was ultimately cancelled and the services were postponed. The amount was recorded as a deposit on contract. Later, on March 27, 2017, the Company entered into an agreement with the same firm to provide these services on an expanded scale for a fee of $150,000. Per the agreement, the firm applied our previously remitted funds and we paid the remaining $75,000 balance. In addition to the cash compensation, the firm was also compensated via a one-time equity retainer of 25,000 shares of common stock.

On April 4, 2017, the Company entered into an agreement with a firm to provide management and general business consulting services. The term of the agreement is 24 months, and the firm will be compensated via the issuance of 1,000,000 shares of common stock at a price of $.21 per share. The shares will be expensed ratably over the term of the agreement.

On January 18, 2018, the Company entered into an agreement for corporate communications services. The agreement is for an initial period of six months with a monthly fee of $5,000. Should the Company raise $2,000,000 or more, the monthly fee increases to $7,500 per month. The Company will also issue 1,000,000 shares of common stock per this agreement. These shares have not yet been issued as of the date of this report.

On March 16, 2018, the Company entered into an Advisor Agreement (the “Advisor Agreement) with a third party (the “Advisor”), and David Drake (“Drake”), a consultant to the cryptocurrency industry. Under the terms of the Advisor Agreement, Drake was appointed to the Company’s Advisory Board and Drake and the Advisor agreed to assist the Company in the implementation and execution of its cryptocurrency business model, including initiation of its mining business and recommending to the Company potential acquisitions and joint ventures in this sector. Drake is required to devote at least three business days per month to assisting the Company. The Company agreed to issue the Advisor 6,666,666 shares of common stock valued at $0.03 per share, which shares shall vest quarterly over a 12-month period subject to the Advisor Agreement not having been terminated as of each applicable vesting date. The Company also issued the Advisor 6,666,666 3-year warrants, with the same vesting period, exercisable at $0.05 per share. The Company agreed to pay the Advisor a royalty from revenues received from its mining of cryptocurrency with the royalties decreasing over a five-year period. Finally, the Company agreed to reimburse the Advisor $5,000 a month for the services of an engineer to operate the Company’s cryptocurrency mining business.

On May 15, 2018, the Company entered into a Master Service Agreement with ColoGuard Enterprise Solutions (“ColoGuard”) which becomes effective August 1, 2018. ColoGuard will provide colocation and other services related to our cryptocurrency mining activities. The initial term of the agreement is two years, with automatic 12-month renewals unless thirty days written notice is provided. The monthly obligation under the agreement with the current specifications is $30,212. On June 27, 2018, the Company made a $459,648 deposit towards mining equipment (totaling $646,000) to ColoGuard. This equipment is scheduled to be placed into operation during the quarter ended September 30, 2018.

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Shareholders' Deficit

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

Shareholders' Deficit

8. Shareholders’ Deficit

Common Stock

There is currently only one class of common stock. Each share of common stock is entitled to one vote. The authorized number of shares of common stock of the Company at June 30, 2018 was 500,000,000 shares with a par value per share of $0.001. Authorized shares that have been issued and fully paid amounted to 228,460,470 as of June 30, 2018.

Preferred Stock

The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.01 per share, with rights, preferences and limitations as may be decided from time-to-time by the Board of Directors.

Series E

Effective January 3, 2018, the Board of Directors authorized the issuance of up to 305,000 shares of Series E Convertible Preferred Stock ("Series E"). Each share of Series E has a stated value of $1,000 and is convertible into shares of our common stock at a conversion price of $1.00 per share. The Series E does not have any price protection from future issuances of securities by the Company at a price below the conversion price then in effect.

Pursuant to an Exchange Agreement entered into effective January 3, 2018, we issued 303,714 shares of the Series E in exchange for the cancellation of the following securities:

• 133,333.69 shares of Series A Convertible Preferred Stock (extinguishing such series) - 133,334 Series E shares;
• 14,923.30 shares of Series A-1 Convertible Preferred Stock (extinguishing such series) – 44,770 Series E shares;
• 501.54 shares of Series C Convertible Preferred Stock (extinguishing such series) – 50,154 Series E shares;
• $650,000 of Senior Convertible Notes issued March 3, 2017 – 63,368 Series E shares;
• $63,158 of Senior Convertible Notes issued August 21, 2017 – 7,125 Series E shares; and
• Warrants to purchase 4,963,402 shares of our common stock – 4,963 Series E shares.

During the six months ended June 30, 2018, holders of 174,524 shares of Series E converted them into 174,524,000 shares of our common stock. At June 30, 2018, there are 129,190 shares of Series E outstanding, which are convertible into an aggregate of 129,190,000 shares of our common stock.

Series C

In 2014, the Board approved the issuance of Series C Preferred Stock (“Series C”). Each share of Series C shall be convertible at the option of the holder at any time, into 10,000 shares of common stock. During the year ended December 31, 2017, holders of 113 shares of Series C converted them into 1,130,000 shares of our common stock. At December 31, 2017, there are 501.54 shares of Series C outstanding. Effective January 3, 2018, all Series C shares were cancelled in exchange for 50,154 Series E shares.

Series A-1

Effective August 24, 2016, the Board approved the issuance of Series A-1 Preferred Stock (“Series A-1”). Each share of Series A-1 shall be convertible at the option of the holder at any time, into 100 shares of common stock. During the year ended December 31, 2017, holders of 5447.39 shares of Series A-1 converted them into 544,739 shares of common stock. At December 31, 2017, there are 14,923 shares of Series A-1 outstanding. Effective January 3, 2018, all Series A-1 shares were cancelled in exchange for 44,770 Series E shares.

Series A

Effective September 13, 2016, the Company closed on the SPA and the Board approved the issuance of a newly designated Series A Convertible Preferred Stock (“Series A”). At December 31, 2017, there were 133,334 shares of Series A outstanding. Effective January 3, 2018, all Series A shares were cancelled in exchange for 133,334 Series E shares.

The Series A contained certain provisions that were outside the Company's control and which the Company believed caused the Series A to be classified as mezzanine equity.

Warrants

The balance of warrants outstanding for purchase of the Company’s common stock as of June 30, 2018 is as follows:

	Common Shares Issuable Upon Exercise of Warrants			Exercise Price of Warrants		Date Issued	Expiration Date
Balance of warrants at December 31, 2017		8,096,736
Cancelled in exchange for Series E (1)		(4,963,402	)
Issued per offering (2)		35,087,720		$	.06	3/6/2018	9/6/2023
Issued for services (3)		6,666,666		$	.05	3/16/2018	3/16/2021
Balance of warrants at June 30, 2018		44,887,720

(1) As discussed above, on January 3, 2018, 4,963,402 warrants to purchase shares of common stock were cancelled in exchange for 4,963 Series E shares.

(2) On March 6, 2018, pursuant to the 2018 Notes (see Note 5), the Company issued warrants at $.06 to purchase 35,087,720 shares of common stock. The warrants may not be exercised for six months after their effective date of March 6, 2018. The warrants have an expiration date of five years after the initial six months have passed. As of June 30, 2018, the Company has recorded $185,263 as a derivative liability for these warrants.

(3) On March 16, 2018, per the terms of the Advisor Agreement (see Note 7), the Company issued warrants at $.05 to purchase 6,666,666 shares of common stock. The warrants have an expiration date of March 16, 2021. As of June 30, 2018, the Company has recorded $33,600 as a derivative liability for these warrants.

2016 Equity Incentive Plan

Effective September 13, 2016, the Company adopted the 2016 Equity Incentive Plan (the "2016 Plan") to provide an incentive to our employees, consultants, officers and directors who are responsible for or contribute to our long-range success. A total of 3,300,000 shares of our common stock were originally reserved for the implementation of the 2016 Plan, either through the issuance of incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, or restricted stock units. Whenever practical, the 2016 Plan is to be administered by a committee of not less than two members of the Board of Directors appointed by the full Board, and the 2016 Plan has a term of ten years, unless sooner terminated by the Board. On January 3, 2018, the Board amended the Company’s 2016 Equity Incentive Plan by increasing the authorized number of shares available under the plan by 30,000,000. As of June 30, 2018, 15,145,000 shares of common stock remain available for issuance under the 2016 Plan.

Effective September 13, 2016, pursuant to his employment agreement, the Company entered into a Restricted Stock Unit (“RSU”) Agreement with Mr. Read which granted him 500,000 RSUs pursuant to the 2016 Plan. The RSUs were to vest in three approximately equal increments with the first tranche being fully vested on the grant date and the remaining tranches vesting on the first-year and second-year anniversaries of the grant date. The fair value of the award was calculated based on the price of the common stock on the grant date and was to be expensed over the vesting period. Effective January 31, 2017, Mr. Read’s former employment agreement was terminated and the RSUs became fully vested. The Company recorded $0 and $128,695 in expense related to this grant during the six months ended June 30, 2018 and 2017, respectively.

On January 20, 2017, the Company granted options to purchase 1,655,000 shares of its common stock at $.50 to employees including a total of 800,000 options to its then Chief Executive Officer and Chief Financial Officer per the 2016 Plan. The shares will vest based on months of service as of the grant date. Employees that had worked for twelve months or more as of the grant date had one-third of their options vested as of grant date. All other employees received pro-rata vesting for the portion of a year that they had worked. The remaining options will equally vest on the 1^st and 2^nd anniversary of the grant date. The Company recorded $145,550 and $338,333 in expense related to this grant during the six months ended June 30, 2018 and 2017, respectively.

On January 3, 2018, as part of an oral employment agreement with the Company’s Chief Executive Officer, the Company granted Mr. Read 15,000,000 stock options of which 5,000,000 vested on the grant date, 5,000,000 will vest one-year from the grant date, and 5,000,000 will vest two years from the grant date subject to continued employment with the Company. The Company recorded $219,150 in expense related to this grant during the six months ended June 30, 2018.

On January 22, 2018, the Company granted board member Gary Smith 1,000,000 stock options under the 2016 Plan, exercisable at $.03 per share, vesting quarterly over one year beginning in three months subject to continued service as a director on each applicable vesting date. The Company recorded $12,200 in expense related to this grant during the six months ended June 30, 2018.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

9. Fair Value Measurements

Our financial instruments consist of cash, accounts payable, accrued liabilities, and warrant liability. We do not believe that we are exposed to significant interest, currency, or credit risks arising from these financial instruments. The fair values of the warrants approximates their carrying values using Level 3 inputs. Gains and losses recognized on changes in fair value of the warrants are reported in other income (expense). Our warrant valuation was measured at fair value by applying the Black-Scholes option valuation model, which utilizes Level 3 inputs.

The assumptions used in the Black-Scholes option re-valuation for the September 2016 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 3.25 years
Risk-free interest rate - 2.63%	Volatility – 216.150%.

The assumptions used for the March 2017 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 4.25 years
Risk-free interest rate - 2.73%	Volatility – 223.895%.

The assumptions used for the March 6, 2018 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 5.25 years
Risk-free interest rate - 2.73%	Volatility – 214.446%.

The assumptions used for the March 16, 2018 warrants at June 30, 2018 are as follows:

Dividend yield – 0%	Expected life – 2.75 years
Risk-free interest rate - 2.63%	Volatility – 259.419%.

The following summarizes the Company's financial liabilities that are measured at fair value on a recurring basis at June 30, 2018.

	Level 1		Level 2		Level 3		Total
Liabilities
Derivative liabilities	$	—	$	—	$	231,176	$	231,176

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Subsequent Events

6 Months Ended

Jun. 30, 2018

Subsequent Events [Abstract]

Subsequent Events

10. Subsequent Events

On July 17, 2018, the Company issued 7,000,000 shares of common stock for the conversion of 7,000 shares of Series E.

Effective August 7, 2018, (the “Effective Date”) the Company borrowed $76,000 from an institutional investor (the “Investor”) and issued the Investor a 5% Original Issue Discount Promissory Note (the “Note”) in the total principal amount of $80,000. The Note matures on the sixth month anniversary of the Effective Date and bears interest at 12% per annum. The Note automatically becomes due and payable upon the Company closing a financing through which the Company receives proceeds of at least $125,000.

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Summary of Significant Accounting Policies and Use of Estimates (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Basis of Presentation and Organization and Reorganization

Basis of Presentation and Organization and Reorganization

Effective September 13, 2016, TimefireVR Inc., a Nevada corporation (“Timefire,” “we,” “us,” “our” or the “Company”) entered into an Agreement and Plan of Merger (“Merger Agreement” or the “Merger”) through which it acquired Timefire LLC, a Phoenix-based virtual reality content developer and Arizona Limited Liability Company (“TLLC”). As consideration for the Merger, the Company issued the equity holders of TLLC a total of 41,400,000 shares of its common stock, and 2,800,000 five-year warrants exercisable at $0.58 per share for 100% of the membership interests of TLLC. As a result, the former members of TLLC owned approximately 99% of the then outstanding shares of common stock.

On January 3, 2018, the Company entered into a Membership Interest Purchase Agreement (the “Agreement”) by and between the Company and Mitchell Saltz (“Saltz”). Pursuant to the terms of the Agreement, Saltz acquired all the membership interests of the Company’s subsidiary, Timefire LLC (“TLLC”).

In consideration for entering in the Agreement, the Company received: (i) $100,000 in cash and (ii) a secured (by all the tangible and intangible property of TLLC) promissory note in the principal amount of $120,000 bearing 6% annual interest maturing on September 28, 2018. Additionally, Saltz or TLLC assumed certain of the Company’s liabilities including a sublease agreement entered into by the Company, loans made by Saltz to the Company, a certain $100,000 senior convertible note of the Company dated March 3, 2017, a certain services agreement entered into by the Company, certain past compensation owed to the Company’s former executive officers, and certain credit card debts owed by the Company.

On January 3, 2018, the Company purchased $100,000 of ether, the cryptocurrency offered by the Ethereum network. This purchase was the Company’s first material cryptocurrency purchase and signified the start of the Company’s entry into the cryptocurrency business. The Company records its cryptocurrency holdings at fair value as of valuation date. The Company recorded net loss on fair value of its cryptocurrency holdings of $55,083 for the six months ended June 30, 2018.

Unaudited Interim Financial Statements

Unaudited Interim Financial Statements

The interim financial statements of the Company as of June 30, 2018 and 2017, and for the periods then ended, are prepared in accordance with the instructions to Form 10-Q. Accordingly, the accompanying financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States of America (“U.S. GAAP”). However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company’s financial position as of June 30, 2018 and the results of its operations and its cash flows for the periods ended June 30, 2018 and 2017. These results are not necessarily indicative of the results expected for the year ended December 31, 2018. The financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2017, filed with the U.S. Securities and Exchange Commission (the “SEC”) on April 9, 2018. The balance sheet as of December 31, 2017 has been derived from the audited financial statements included in that filing.

Principles of Consolidation

Principles of Consolidation

For accounting purposes, the Merger transaction was recorded as a reverse recapitalization, with TLLC as the accounting acquirer. Consequently, the historical pre-Merger financial statements of TLLC were then those of the Company. The financial statements for periods December 31, 2017 and prior include the accounts of the Company and TLLC. All significant intercompany transactions and balances have been eliminated. Equity investments through which we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee's activities are accounted for using the equity method where applicable.

Reclassifications

Reclassifications

For the three and six months ended June 30, 2017, the Company’s Statement of Operations and Cash Flows have been reclassified to the current presentation to reflect the discontinued operations resulting from the sale of TLLC. The reclassified financial statement items had no effect on net income for the periods.

Discontinued Operations

Discontinued Operations

The Company has classified the operating results related to the TLLC virtual reality business, which was sold on January 3, 2018, as discontinued operations in the financial statements. As per SEC guidelines, the December 31, 2017 balance sheet has not been retrospectively adjusted to reflect discontinued operations. Such adjustment will be reflected when the December 31, 2017 balance sheet is first presented with annual financial statements that report discontinued operations.

Discontinued operations consist of specifically identified expenses as follows:

TIMEFIREVR INC.
STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended					Six Months Ended
	June 30,		June 30,			June 30,			June 30,
	2018		2017			2018			2017
Revenues	$	—	$	488		$	—		$	488
Cost of sales		—		146			—			146
Gross profit		—		342			—			342
Operating expenses:
Research and development		—		344,001			—			792,892
Occupancy		—		20,135			—			43,342
Depreciation and amortization		—		3,151			—			6,303
Officer compensation		—		108,864			—			321,720
Professional fees		—		1,062			—			1,562
Other operating expenses		—		2,829			—			23,000
Total operating expenses		—		480,042			—			1,188,819
Loss from operations		—		(479,700	)		—			(1,188,477	)
Other income (expense):
Gain on disposal of Timefire, LLC		—		—			670,428			—
Interest income		—		—			—			2
Interest expense		—		(12,130	)		(180	)		(15,578	)
Total other income (expense)		—		(12,130	)		670,248			(15,576	)
Income (loss) from discontinued operations	$	—	$	(491,830	)	$	670,248		$	(1,204,053	)

Accounting Estimates

Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates. Significant estimates of the Company include accounting for depreciation and amortization, derivative liabilities, accruals and contingencies, the fair value of the Company’s common stock and the estimated fair value of warrants.

Revenue Recognition

Revenue Recognition

On January 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASC 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under U.S. GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation.

The Company is paid in cryptocurrency for its mining operations. The revenue generated is valued by the cryptocurrency fair value on the date earned.  

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid instruments, with original maturity of three months or less when purchased, to be cash equivalents. We place our cash and cash equivalents with major financial institutions. Such amounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”). From time to time, balances may exceed FDIC coverage limits.

Property and Equipment

Property and Equipment

Property and equipment is recorded at cost reduced by accumulated depreciation. Depreciation is provided for on the straight-line method, over the estimated useful lives of the assets. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Betterments or renewals are capitalized when incurred. Gains and losses on the disposition of property and equipment are recorded in the period incurred.

The estimated useful lives of property and equipment are:

· Office furniture and equipment   3-5 years

Impairment of Long-Lived Assets and Intangible Assets

Impairment of Long-Lived Assets and Intangible Assets

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 360-10, "Property, Plant, and Equipment," which established a "primary asset" approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset and amortizable intangible asset to be held and used. Long-lived assets and amortizable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset and amortizable intangible asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Long-lived assets and amortizable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

Business Segments

Business Segments

ASC 280, "Segment Reporting" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment as of June 30, 2018.

Research and Development Costs

Research and Development Costs

Research and development costs, including design, development and testing of software, are expensed as incurred.

Income Taxes

Income Taxes

The Company accounts for income taxes under FASB ASC 740, Income Taxes. Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

Stock-Based Compensation

Stock-Based Compensation

In accordance with ASC No. 718, Compensation – Stock Compensation (“ASC 718”), the Company measures the compensation costs of stock-based compensation arrangements based on the grant date fair value of granted instruments and recognizes the costs in the financial statements over the period during which such awards vest. Stock-based compensation arrangements include stock options and restricted stock awards.

Equity instruments (“Instruments”) issued to non-employees are recorded on the basis of the fair value of the Instruments, as required by ASC 718. ASC No. 505, Equity Based Payments to Non-Employees (“ASC 505”), defines the measurement date and recognition period for such Instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete and (ii) the Instruments are vested. The measured fair value related to the Instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in ASC 505.

Net Income (Loss) per Share

Net Income (Loss) Per Share

Basic earnings per share does not include dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could share in the earnings of an entity. Dilutive securities are not included in the weighted average number of shares when inclusion would be anti-dilutive. As of June 30, 2018 and 2017, there were total shares of 192,232,724 and 23,215,628, respectively, issuable upon conversion of preferred stock, exercise of warrants and options.

Fair Value Measurements

Fair Value Measurements

ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in U.S. GAAP, and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2018. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, accounts payable and accrued expenses.

Derivative Liabilities

Derivative Liabilities

The Company issued common stock purchase warrants in September 2016 in conjunction with the Merger Agreement.  Additional warrants were issued in March and August 2017 as part of private placement offerings. Warrants were also issued in March 2018 as part of a private placement offering (see Note 5) and per an advisory agreement (see Note 7). In accordance with ASC No. 480, Distinguishing Liabilities from Equity (“ASC 480”), the fair value of these warrants is classified as a liability on the Company’s Balance Sheets because, according to the warrants' terms, a fundamental transaction could give rise to an obligation of the Company to pay cash to certain warrant holders. Corresponding changes in the fair value of the warrants are recognized as a gain or loss on the Company’s Statements of Operations in each subsequent period.

The fair value of the warrants at June 30, 2018 and December 31, 2017 was $231,176 and 198,994, respectively. The difference has been recorded as a change in change in fair value of derivatives.

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Summary of Significant Accounting Policies and Use of Estimates (Tables)

6 Months Ended

Jun. 30, 2018

Summary Of Significant Accounting Policies And Use Of Estimates

Discontinued operations

TIMEFIREVR INC.
STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended					Six Months Ended
	June 30,		June 30,			June 30,			June 30,
	2018		2017			2018			2017
Revenues	$	—	$	488		$	—		$	488
Cost of sales		—		146			—			146
Gross profit		—		342			—			342
Operating expenses:
Research and development		—		344,001			—			792,892
Occupancy		—		20,135			—			43,342
Depreciation and amortization		—		3,151			—			6,303
Officer compensation		—		108,864			—			321,720
Professional fees		—		1,062			—			1,562
Other operating expenses		—		2,829			—			23,000
Total operating expenses		—		480,042			—			1,188,819
Loss from operations		—		(479,700	)		—			(1,188,477	)
Other income (expense):
Gain on disposal of Timefire, LLC		—		—			670,428			—
Interest income		—		—			—			2
Interest expense		—		(12,130	)		(180	)		(15,578	)
Total other income (expense)		—		(12,130	)		670,248			(15,576	)
Income (loss) from discontinued operations	$	—	$	(491,830	)	$	670,248		$	(1,204,053	)

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Gain on Disposal of Timefire LLC (Tables)

6 Months Ended

Jun. 30, 2018

Discontinued Operations and Disposal Groups [Abstract]

Gain on disposal of Timefire LLC included in income from discontinued operations

Assets sold:
Cash	(505	)
Property & equipment, net	(26,128	)
Accounts receivable	(38	)
Deposit	(33,500	)
	(60,171	)
Liabilities relieved:
Accounts payable & accrued expenses	204,809
Demand obligation payable - related party	116,883
Convertible notes payable	100,000
Accrued interest	31,507
Short-term advance - related party	57,400
	510,599
Additional consideration:
Note receivable	120,000
Cash	100,000
	220,000
Gain on disposal of Timefire, LLC	670,428

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Shareholders' Deficit (Tables)

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

Balance of warrants outstanding for purchase of Company's common stock

	Common Shares Issuable Upon Exercise of Warrants			Exercise Price of Warrants		Date Issued	Expiration Date
Balance of warrants at December 31, 2017		8,096,736
Cancelled in exchange for Series E (1)		(4,963,402	)
Issued per offering (2)		35,087,720		$	.06	3/6/2018	9/6/2023
Issued for services (3)		6,666,666		$	.05	3/16/2018	3/16/2021
Balance of warrants at June 30, 2018		44,887,720

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Financial liabilities measure at fair value on a recurring basis

	Level 1		Level 2		Level 3		Total
Liabilities
Derivative liabilities	$	—	$	—	$	231,176	$	231,176

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Summary of Significant Accounting Policies and Use of Estimates - Discontinued operations (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Summary Of Significant Accounting Policies And Use Of Estimates - Discontinued Operations
Revenues		$ 488		$ 488
Cost of sales		146		146
Gross profit		342		342
Operating expenses:
Research and development		344,001		792,892
Occupancy		20,135		43,342
Depreciation and amortization		3,151		6,303
Officer compensation		108,864		321,720
Professional fees		1,062		1,562
Other operating expenses		2,829		23,000
Total operating expenses		480,042		1,188,819
Loss from operations		(479,700)		(1,188,477)
Other income (expense):
Gain on disposal of Timefire, LLC			670,428
Interest income				2
Interest expense		(12,130)	(180)	(15,578)
Total other income (expense)		(12,130)	670,248	(15,576)
Income (loss) from continuing operations		$ (491,830)	$ 670,248	$ (1,204,053)

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Summary of Significant Accounting Policies and Use of Estimates (Details Narrative) - USD ($)	1 Months Ended	6 Months Ended
	Sep. 30, 2016	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Cash proceeds received for subsidiary Purchase Agreement		$ 100,000
Promissory note received for subsidiary Purchase Agreement, principal amount		$ 120,000
Antidilutive securities excluded from calculation of earnings per share		192,232,724	23,215,628
Fair value of warrants		$ 231,176		$ 198,994
Merger Agreement
Company common stock issued to equity holders of Timefire, shares	41,400,000
Warrants issued to equity holders of Timefire, shares	2,800,000
Warrants issued to equity holders of Timefire, exercise price	$ 0.058
Membership interest of Timefire acquired	100.00%
Company voting interest owned by former Timeshare members	99.00%

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Gain on Disposal of Timefire LLC - Gain on disposal of Timefire LLC included in income from discontinued operations (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Assets sold:
Cash			$ (505)
Property & equipment, net			(26,128)
Accounts receivable			(38)
Deposit			(33,500)
Assets sold, total			(60,171)
Liabilities relieved:
Accounts payable & accrued expenses			204,809
Demand obligation payable - related party			116,883
Convertible notes payable			100,000
Accrued interest			31,507
Short-term advance - related party			57,400
Liabilities relieved, total			510,599
Additional consideration:
Note receivable			120,000
Cash			100,000
Additional consideration, total			220,000
Gain on disposal of Timefire, LLC			$ 670,428

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Gain on Disposal of Timefire LLC (Details Narrative)	6 Months Ended
	Jun. 30, 2018 USD ($)
Discontinued Operations and Disposal Groups [Abstract]
Total gross proceeds from sale	$ 220,000

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Cryptocurrencies (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Investments, Debt and Equity Securities [Abstract]
Payments for purchase of ether	$ (100,000)
Fair value of ether	46,627
Charge to operations	53,364
Revenue generated from cryptocurrency mining operations	$ 8,917

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Convertible Notes Payable (Details Narrative) - USD ($)	1 Months Ended			6 Months Ended		13 Months Ended
	Jan. 20, 2018	Nov. 29, 2017	Sep. 03, 2017	Jun. 30, 2018	Sep. 03, 2017	Apr. 15, 2019
Convertible notes payable, amount				$ 1,826,579
Debt discount on convertible notes payable				37,427
Accrued interest on convertible notes payable				292,575
Interest expense on convertible notes payable				$ 266,381
March 2017 Notes
Convertible notes payable, amount			$ 750,000		$ 750,000
Original issue discount percentage					5.00%
Gross proceeds received by Company					$ 712,500
Reimbursement of legal fees					$ 20,000
Maturity date					Sep. 03, 2017
Interest per annum					8.00%
Conversion price per share			$ .30		$ .30
Warrants issued as additional compensation					2,500,000
Warrant term					5 years
Exercise price of warrants issued					$ 0.35
August 2017 Notes
Convertible notes payable, amount			$ 63,158		$ 63,158
Gross proceeds received by Company			$ 60,000
Maturity date			Sep. 03, 2017
Warrants issued as additional compensation			210,526
Warrant term			5 years
Exercise price of warrants issued			$ 0.35
October 2017 Notes
Convertible notes payable, amount		$ 70,000
Maturity date		Nov. 29, 2017				Apr. 15, 2019
Interest per annum		8.00%
Conversion price per share		$ 0.03
December 2017 Notes
Convertible notes payable, amount	$ 703,947
Original issue discount percentage	5.00%
Gross proceeds received by Company	$ 668,750
Maturity date	Jan. 20, 2018					Apr. 15, 2019
Interest per annum	8.00%
Conversion price per share	$ 0.03
2018 Notes
Convertible notes payable, amount						$ 1,052,632
Original issue discount percentage						5.00%
Gross proceeds received by Company						$ 1,000,000
Maturity date						Apr. 15, 2019
Interest per annum						8.00%
Conversion price per share						$ 0.03
Warrants issued as additional compensation						35,087,720
Warrant term						5 years
Exercise price of warrants issued						$ 0.06

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Related Party Transactions (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Jun. 02, 2017	Mar. 06, 2017
Related Party Transactions [Abstract]
Investors' note amount			$ 100,000
Retainer deposit received for services to entity managed by former director		$ 57,400
Advances received from related party	$ 116,883

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Commitments and Contingencies (Details Narrative) - USD ($)				1 Months Ended	2 Months Ended	3 Months Ended	6 Months Ended	11 Months Ended	14 Months Ended
	Apr. 04, 2017	Mar. 27, 2017	Nov. 07, 2016	Mar. 31, 2018	Mar. 31, 2018	Mar. 31, 2018	Jun. 30, 2018	Dec. 31, 2017	Oct. 30, 2017
Employment Agreements
Accrued payroll for former officers								$ 106,000
Lease Agreements
Rent expense							$ 5,400
Other Agreements
Shares of common stock issued per agreement with firm	1,000,000							50,000
Total expense for agreement with firm								$ 46,000
Remaining amounts owed to firm in accounts payable								35,000
Integration fee paid to firm								$ 127,500
Fee paid to firm for advisory services upon execution of contract		$ 75,000	$ 75,000
Common stock to be issued to firm		25,000
Monthly consulting fee for corporate communications counsel					$ 5,000
Common stock to be issued for corporate communications counsel					1,000,000
Common stock issued to Advisor, shares				6,666,666
Common stock issued to Advisor, value per share				$ 0.03
Warrants issued to Advisor, shares				6,666,666
Warrants issued to Advisor, exercise price per share				$ 0.05
Monthly reimbursement amount for services of engineer				$ 5,000
Monthly obligation under ColoGuard Agreement							30,212
Deposit made toward mining equipment to ColoGuard							$ 459,648
Former CEO
Employment Agreements
Annual compensation									$ 150,000
CEO
Employment Agreements
Annual compensation						$ 240,000
Stock options granted						15,000,000
Non-employee director
Employment Agreements
Compensation fee per quarter						$ 2,500

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Shareholders' Deficit - Balance of warrants outstanding for purchase of Company's common stock (Details)	6 Months Ended
	Jun. 30, 2018 $ / shares shares
Balance of warrants
Common shares issuable upon exercise of warrants, beginning	8,096,736
Common shares issuable upon exercise of warrants, ending	44,887,720
Cancelled in exchange for Series E (1)
Warrants cancelled	(4,963,402)
Issued per Offering (2)
Warrants issued	35,087,720
Exercise price of warrants | $ / shares	$ 0.06
Date issued	Mar. 06, 2018
Expiration date	Sep. 06, 2023
Issued for services (3)
Warrants issued	6,666,666
Exercise price of warrants | $ / shares	$ 0.05
Date issued	Mar. 16, 2018
Expiration date	Mar. 16, 2021

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Shareholders' Deficit (Details Narrative) - USD ($)	1 Months Ended	6 Months Ended
	May 11, 2018	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Common Stock
Common stock, par value		$ 0.001		$ 0.001
Common stock, shares authorized		500,000,000		500,000,000
Common stock, shares issued		228,460,470		47,269,804
Common stock, shares outstanding		228,460,470		27,269,804
Preferred Stock
Preferred stock, par value		$ 0.01		$ 0.01
Preferred stock, shares authorized		10,000,000		10,000,000
Series E Convertible Preferred Stock, shares authorized		305,000
Series E Convertible Preferred Stock, value per share		$ 1,000
Series E Convertible Preferred Stock, conversion price per share into common stock		$ 1.00
Series E Convertible Preferred Stock, shares issued in exchange for cancellation of securities		303,714
Series E Convertible Preferred Stock, shares converted	7,000	174,524
Series E Convertible Preferred Stock, common shares issued upon conversion	7,000,000	174,524,000
2016 Equity Incentive Plan
Common stock reserved for implementation of 2016 Equity Incentive Plan, shares		30,000,000
Common stock available for issuance under 2016 Plan, shares		15,145,000
Restricted Stock Units granted to CEO		500,000
Expense recorded on grant of restricted stock units to CEO		$ 128,693
Options granted, shares		1,655,000
Options granted, price per share		$ 0.50
Expense related to grants of options		$ 145,550	$ 338,333
Chief Executive Officer options
2016 Equity Incentive Plan
Options granted, shares		15,000,000
Expense related to grants of options		$ 219,150
Non-employee director options
2016 Equity Incentive Plan
Options granted, shares		1,000,000
Options granted, price per share		$ 0.03
Expense related to grants of options		$ 12,200

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Fair Value Measurements - Financial liabilities measure at fair value on a recurring basis (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Liabilities
Derivative liabilities	$ 231,176	$ 198,994
Level 1
Liabilities
Derivative liabilities
Level 2
Liabilities
Derivative liabilities
Level 3
Liabilities
Derivative liabilities	$ 231,176

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Fair Value Measurements (Details Narrative)	6 Months Ended
	Jun. 30, 2018
September 2016 warrants re-valuation
Assumptions used to determine fair value of warrants, dividend yield	0.00%
Assumptions used to determine fair value of warrants, risk-free interest rate	2.63%
Assumptions used to determine fair value of warrants, expected life	3 years 3 months
Assumptions used to determine fair value of warrants, volatility	216.15%
March 2017 warrants valuation
Assumptions used to determine fair value of warrants, dividend yield	0.00%
Assumptions used to determine fair value of warrants, risk-free interest rate	2.73%
Assumptions used to determine fair value of warrants, expected life	4 years 3 months
Assumptions used to determine fair value of warrants, volatility	223.895%
March 6, 2018 warrants valuation
Assumptions used to determine fair value of warrants, dividend yield	0.00%
Assumptions used to determine fair value of warrants, risk-free interest rate	2.73%
Assumptions used to determine fair value of warrants, expected life	5 years 3 months
Assumptions used to determine fair value of warrants, volatility	214.446%
March 16, 2018 warrants valuation
Assumptions used to determine fair value of warrants, dividend yield	0.00%
Assumptions used to determine fair value of warrants, risk-free interest rate	2.63%
Assumptions used to determine fair value of warrants, expected life	2 years 9 months
Assumptions used to determine fair value of warrants, volatility	259.419%

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Subsequent Events (Details Narrative) - USD ($)		1 Months Ended	6 Months Ended
	Aug. 07, 2018	May 11, 2018	Jun. 30, 2018
Subsequent Events [Abstract]
Common stock issued for conversion of Series E, common shares issued		7,000,000	174,524,000
Common stock issued for conversion of Series E, preferred shares converted		7,000	174,524
Amounts borrowed from Investor	$ 76,000
Note issued to Investor, amount	$ 80,000
Note issued to Investor, interest per annum	12.00%