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Cannes’ ‘Papicha’ Receives Tokenized Investment from Hong Kong Financiers (EXCLUSIVE)

Papicha,” the Algerian film in Un Certain Regard at Cannes this year, has received finance from two Hong Kong companies that have used modern financial techniques to “tokenize” their direct investment in the film’s equity.

Directed by Mounia Meddour, the female emancipation story about a woman daring to put on a fashion show in the post-revolutionary era has been selected to represent Algeria for the Best International Feature Film at the Oscars. It is set for a commercial release in France on Oct. 9 on approximately 150 prints.

Papicha” was produced by Xavier Gens and Gregoire Gensollen from Paris-based The Ink Connection, and Patrick Andre from High Sea Productions. It is distributed in France and internationally by Jour2Fete.

Hong Kong-based Lumiere and FinFabrik have teamed up to apply their business and technical know-how to tokenize a co-investment into “Papicha.” The value of their investment was not disclosed.

“By having their equity participation digitalized, investors will have the opportunity in the future to transfer or sell it to other investors who want to have access to an exciting alternative asset,” Patrice Poujol, CEO of Lumiere, and author of the book “Online Film Production in China Using Blockchain and Smart Contracts,” told Variety. “If allowed by the issuer, these tokens can immediately be traded on CrossPool over-the-counter, directly between investors. In the future, we may see more liquid markets on dedicated exchanges.”

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“We are humbled to bring forward our experience and our distributed ledger technology-based asset tokenization platform CrossPool to co-create with Lumiere a new way to invest into movies, that will lead to more transparency, security and efficiency gains,” said Alex Medana, co-founder and CEO of FinFabrik. He described the company’s mission as “reinventing capital markets and bringing finance to everyone.”

Distributed ledger technology, such as Blockchain, allows information ranging from contracts through to units of stock, or money (such as Bitcoin), to be stored and simultaneously updated on multiple servers around the world. Encrypted and stored this way, transactions are secure, always available, and cannot be controlled by a single gatekeeper or authority.

Poujol said that the transaction was a first of its kind, and a step forward for film financing. “What Finfabrik and Lumiere have done with ‘Papicha’ is the first issuance with a hybrid instrument and fully digital workflows. Previous experiences from other companies involve the finance of films with crypto assets like Braid. But this is a totally different mechanism and procedure (as) raising funding through crypto assets does not mean that the underlying participation of the film is digitised,” said Poujol and Florian Spiegl, co-founder of FinFabrik.

“The arthouse film industry is eager for more transparency and flexibility, and we are glad to pioneer into this new initiative by digitalizing an investment in our film ‘Papicha’ and its promising international theatrical journey,” said Gensollen, co-founder of The Ink Connection

Jour2Fete is a Paris-based company set up in 2006 by Sarah Chazelle and Etienne Ollagnier, which has released over 100 films theatrically, and in video/vod/tv/svod. Its international sales department, launched in 2012,has handled titles including 2017 Un Certain Regard film Beauty and the Dogs, Alain Gomis’ 2017 Berlin prize winner and “Manta Ray,” by Thailand’s Phuttiphong Aroonpheng, and which won the best film prize in the 2018 Orrizonti section in Venice.

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