US$ Outlook / A Limited-Time Opportunity in the Junior Gold Space

FRC Top Picks

The following table shows last week&rsquo;s top five performers among our Top Picks, including five junior resource companies. The top performer, World Copper (TSXV: WCU) , was up 36% . WCU is advancing multiple copper projects in the Americas.

Top 5 Weekly Performers WoW Returns World Copper Ltd. (WCU.V) 36.4% Starcore International Mines Ltd. (SAM.TO) 23.1% Kidoz Inc. (KIDZ.V) 16.0% New Age Metals Inc. (NAM.V) 12.5% Sirios Resources Inc. (SOI.V) 7.1% * Past performance is not indicative of future performance (as of May 13, 2024) Source: FRC

Last week, companies on our Top Picks list were up 1.5% on average vs 1.0% for the benchmark (TSXV). Our top picks have outperformed the benchmark in all of the seven time periods listed below.

Performance by Sector

Total Return 1 Week 1 mo 3 mo 6 mo 1 yr 3 yr Since launch Mining 1.6% 4.0% 33.5% 26.7% 2.4% -45.4% 9.8% Cannabis N/A N/A N/A N/A N/A -42.1% -23.6% Tech 16.0% 53.0% 136.0% 24.0% -7.0% -32.2% -3.8% Special Situations (MIC) -0.8% -5.5% -2.7% 12.9% 20.6% -16.7% -11.1% Private Companies N/A N/A N/A N/A 6.7% 20.5% 30.5% Portfolio (Total) 1.5% 3.7% 27.7% 23.1% 5.4% -22.9% 6.3% Benchmark (Total) 1.0% 3.5% 8.9% 15.5% -3.1% -37.6% -32.6% Portfolio (Annualized) - - - - 5.4% -8.3% 0.6% Benchmark (Annualized) - - - - -3.1% -14.5% -3.7% 1. Since the earliest initiating date of companies in the list of Top Picks (as of May 13, 2024) 2. Green (blue) indicates FRC's picks outperformed (underperformed) the benchmark. 3. Past performance is not indicative of future performance. 4. Our complete list of top picks (updated weekly) can be viewed here: Top Picks List

Weekly Mining Commentary

Last week, global equity markets were up 0.8% on average (up 0.5% in the previous week). This week, all eyes are focused on U.S. inflation data. We anticipate the US$ will remain strong , given indications that global central banks, particularly the Bank of Canada, the European Central Bank, and the Bank of England, will likely cut rates sooner than the Fed. A robust US$ could exert downward pressure on both equity and metal prices.

Source: FRC / Various

Last week, metal prices were up 2.1% on average (down 1.1% in the previous week).

Gold producer valuations were up 3.8% last week (down 3.4% in the prior week); base metal producers were up 0.8% last week (up 0.1% in the prior week). On average, gold producer valuations are 17% lower compared to the past three instances when gold surpassed US$2k/oz.

06-May-24 13-May-24 Gold Producers EV / R (forward) EV / EBITDA (forward) EV / R (forward) EV / EBITDA (forward) 1 Barrick 3.09 6.63 3.10 6.59 2 Newmont 3.17 7.37 3.29 7.61 3 Agnico Eagle 4.44 8.49 4.67 8.89 4 AngloGold 2.09 4.74 2.18 4.96 5 Kinross Gold 2.29 5.16 2.43 5.50 6 Gold Fields 2.84 5.19 2.93 5.45 7 Sibanye 0.71 3.53 0.75 3.96 8 Hecla Mining 4.16 15.53 4.64 14.85 9 B2Gold 1.75 3.50 1.71 3.52 10 Alamos 4.85 9.14 5.02 9.46 11 Harmony 1.67 4.88 1.70 4.95 12 Eldorado Gold 2.32 4.75 2.47 5.07 Average (excl outliers) 2.66 5.76 2.75 6.00 Min 0.71 3.50 0.75 3.52 Max 4.85 15.53 5.02 14.85 Industry (three year average) 110.70 116.70 110.70 116.70 Base Metal Producers EV / R (forward) EV / EBITDA (forward) EV / R (forward) EV / EBITDA (forward) 1 BHP Group 2.91 5.60 2.93 5.65 2 Rio Tinto 2.32 4.93 2.34 4.98 3 South32 1.57 7.40 1.58 7.36 4 Glencore 0.44 5.87 0.45 6.04 5 Anglo American 2.00 5.95 2.01 5.96 6 Teck Resources 3.00 6.93 3.12 7.21 7 First Quantum 3.97 13.44 3.92 13.30 Average (excl outliers) 2.32 7.16 2.34 7.21 Min 0.44 4.93 0.45 4.98 Max 3.97 13.44 3.92 13.30 Source: S&amp;P Capital IQ &amp; FRC

We are maintaining our metal price forecasts.

Weekly Crypto Commentary Prices of mainstream/popular cryptos were down 5% on average last week (up 7% in the previous week).

May 13, 2024 Cryptocurrencies 1-Week 1-Year Bitcoin 3% 136% Binance Coin 1% 91% Cardano -2% 21% Ethereum -24% 64% Polkadot -7% 25% XRP -2% 20% Polygon -7% -22% Solana -2% 607% AVERAGE -5% 118% MIN -24% -22% MAX 3% 607% Indices Canadian 1-Week 1-Year BTCC -1% 123% BTCX -1% 132% EBIT -1% 129% FBTC -1% 35% U.S. 1-Week 1-Year BITO -1% 61% BTF -3% 68% IBLC -8% 50% Source: FRC/Yahoo Finance

The global MCAP of cryptos is US$2.38T, down 2% MoM, but up 100%YoY.

Total Crypto Market Cap Chart

Source: CoinGecko

Last week, BTC was up 3% , while the S&amp;P 500 was up 1%.

Source: FRC/ Yahoo Finance

The global hash rate of BTC (defined as calculations performed per second/an indicator of network difficulty) is 586 exahashes per second (EH/s), down 2% WoW, and 8% MoM. The decrease in hash rates is positive for miners as their efficiency rates (BTC production per EH/s) are inversely linked to global hash rates.

Total Hash Rate (BTC)

The Realized HODL ratio (RHODL), which gauges the activity of short-term holders relative to long-term holders, is down 23% WoW, but up 414% YoY. We interpret the declining RHODL ratio as a signal of weakening demand, with fewer new buyers entering the market, suggesting potential for a near-term price decline. Historically, BTC prices have moved in tandem with this ratio. By tracking the RHODL, we believe we can identify potential turning points in BTC prices.

Source: FRC/ Various

Companies operating in the crypto space are trading at an average EV/R of 5.9x (previously 6.9x).

Source: S&amp;P Capital IQ/FRC

May 13, 2024 Crypto Companies Ticker TEV/Revenue Argo Blockchain LSE: ARB 2.7 BIGG Digital CSE: BIGG 7.8 Bitcoin Well TSXV: BTCW 0.7 Canaan Inc. NASDAQ: CAN 0.6 CleanSpark Inc. NasdaqCM:CLSK 11.4 Coinbase Global NASDAQ: COIN 12.5 Galaxy Digital Holdings TSX: GLXY N/A HIVE Digital TSXV:HIVE 2.7 Hut 8 Mining Corp. TSX: HUT 8.2 Marathon Digital Holdings NASDAQ: MARA 9.4 Riot Platforms NASDAQ: RIOT 6.9 SATO Technologies TSXV: SATO 2.0 AVERAGE 5.9 MEDIAN 6.9 MINIMUM 0.6 MAXIMUM 12.5 Source: S&amp;P Capital IQ/FRC

US$ Outlook / A Limited-Time Opportunity in the Junior Gold Space

Key Highlights

US$ Outlook / A Limited-Time Opportunity in the Junior Gold Space

Key Highlights