---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

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

For the Quarterly Period ended June 30, 2010

Commission File No. 033-28188

|Registrant name:                        | Strategic Internet Investments, Incorporated
|--------------------------------------- | --------------------------------------------
|                                        |                                             
|State of incorporation:                 | Delaware                                    
|                                        |                                             
|IRS Employer Identification:            | 84-1116458                                  
|                                        |                                             
|Address of principal executive offices: | Nisar Square, Benyas Centre Office No. 207  
|                                        | P.O. Box 40088,                             
|                                        | Dubai, United Arab Emirates                 
|                                        |                                             
|Registrants telephone number           | 009 714 223 1189                            

|Check whether the issuer (1) filed all reports required
      to be filed by Section 13or 15(d) of the Exchange Act during the
      past 12 months, and (2) has beensubject to such filing
      requirements for the past 90 days. | Yes ( X )  | No ( )
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------- | ------
|                                                                                                                                                                                                                                     |            |       
|Indicate by check mark whether the registrant is a
      smaller reporting company(as defined in Rule 12b-2 of the Exchange
      Act).                                                                                              | Yes ( X )  | No ( )
|                                                                                                                                                                                                                                     |            |       
|Indicate by check mark whether the registrant is a shell
      company (as definedin Rule 12b-2 of the Exchange Act).                                                                                                                | Yes ( X )  | No ( )
|                                                                                                                                                                                                                                     |            |       
|Common shares outstanding as of July 31, 2010:                                                                                                                                                                                       | 27,610,326 |       

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PART IFINANCIAL
INFORMATION

Forward Looking Statements.

This report contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These statements relate
to future events or our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as may, should, expects, plans, anticipates, believes,
estimates, predicts, potential or continue or the negative of these
terms or other comparable terminology. These statements are only predictions and
involve known and unknown risks, uncertainties and other factors, including the
risks in the section entitled Risk Factors and the risks set out below, any of
which may cause our or our industrys actual results, levels of activity,
performance or achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or implied by these
forward-looking statements.

These risks include, by way of example and not in limitation:

| |  | results of initial feasibility, pre-feasibility and
      feasibility studies, and the possibility that future real estate
      development results will not be consistent with our
expectations;      
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | real estate development risks, including risks related to
      accidents, equipment breakdowns, labour disputes or other unanticipated
      difficulties or interruptions in development construction;
| |  | the potential for delays in development activities or the
      completion of feasibility studies;                                                                                                      
| |  | risks related to the inherent uncertainty of cost
      estimates and the potential for unexpected costs and expenses;                                                                                  
| |  | risks related to commodity price fluctuations;                                                                                                                                                          
| |  | the uncertainty of profitability based upon our history
      of losses;                                                                                                                                
| |  | risks related to failure to obtain adequate financing on
      a timely basis and on acceptable terms for our planned development
      projects;                                                       
| |  | risks related to environmental regulation and
      liability;                                                                                                                                          
| |  | risks that the amounts reserved or allocated for
      environmental compliance, reclamation, control measures, monitoring and
      on-going maintenance may not be sufficient to cover such costs;    
| |  | risks related to tax assessments;                                                                                                                                                                       
| |  | political and regulatory risks associated with real
      estate development; and                                                                                                                       
| |  | other risks and uncertainties related to our prospects,
      properties and business strategy.                                                                                                         

This list is not an exhaustive list of the factors that may
affect any of our forward-looking statements. These and other factors should be
considered carefully and readers should not place undue reliance on our
forward-looking statements.

The Company intends that such forward-looking statements be
subject to the Safe Harbors for such statements. Forward looking statements are
made based on managements beliefs, estimates and opinions on the date the
statements are made and we undertake no obligation to update forward-looking
statements if these beliefs, estimates and opinions or other circumstances
should change. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. Except as required by
applicable law, including the securities laws of the United States, we do not
intend to update any of the forward-looking statements to conform these
statements to actual results.

Our financial statements are stated in United States dollars
(US$) and are prepared in accordance with United States Generally Accepted
Accounting Principles.

In this report, unless otherwise specified, all dollar amounts
are expressed in United States dollars and all references to common stock refer to the common shares in our capital stock.
As used in this report, the terms we, us, our, the Company and
Strategic mean Strategic Internet Investments, Incorporated, unless otherwise
indicated.

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1. Financial Statements

STRATEGIC INTERNET INVESTMENTS, INCORPORATED

(A Development Stage Company)

INTERIM FINANCIAL STATEMENTS

June 30, 2010

(Stated in U.S. Dollars)

(Unaudited)

---

STRATEGIC INTERNET INVESTMENTS, INCORPORATED(A
Development Stage Company) INTERIM BALANCE SHEETS (Stated in U.S.
Dollars) (Unaudited)

|                                                                                                                                                   |   | June 30,   |   |   | December 31, |  
|-------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------- | - | - | ------------ | -
|                                                                                                                                                   |   | 2010       |   |   | 2009         |  
|                                                                                                                                                   |   |            |   |   |              |  
|ASSETS                                                                                                                                             |   |            |   |   |              |  
|                                                                                                                                                   |   |            |   |   |              |  
|Current                                                                                                                                            |   |            |   |   |              |  
|Cash                                                                                                                                               | $ | 39         |   | $ | 311          |  
|Prepaid expenses                                                                                                                                   |   | 655        |   |   | -            |  
|                                                                                                                                                   |   |            |   |   |              |  
|                                                                                                                                                   | $ | 694        |   | $ | 311          |  
|                                                                                                                                                   |   |            |   |   |              |  
|                                                                                                                                                   |   |            |   |   |              |  
|LIABILITIES                                                                                                                                        |   |            |   |   |              |  
|                                                                                                                                                   |   |            |   |   |              |  
|Current                                                                                                                                            |   |            |   |   |              |  
|Accounts payable  Note 6                                                                                                                          | $ | 562,722    |   | $ | 550,702      |  
|Loans payable  Note 3                                                                                                                             |   | 686,896    |   |   | 624,712      |  
|                                                                                                                                                   |   |            |   |   |              |  
|TOTAL LIABILITIES                                                                                                                                  |   | 1,249,618  |   |   | 1,175,414    |  
|                                                                                                                                                   |   |            |   |   |              |  
|Class A Convertible Preferred stock, $0.001
      par value 
         
       10,000,000 authorized, 198,000 outstanding  Note 4                  |   | 792,000    |   |   | 792,000      |  
|                                                                                                                                                   |   |            |   |   |              |  
|CAPITAL DEFICIT                                                                                                                                    |   |            |   |   |              |  
|                                                                                                                                                   |   |            |   |   |              |  
|Capital Stock  Notes 4, 5 and 6                                                                                                                   |   |            |   |   |              |  
|Common stock,
      $0.001 par value
      
                100,000,000
      authorized          
      27,610,326 outstanding (2009: 27,610,326) |   | 27,610     |   |   | 27,610       |  
|Additional paid-in capital                                                                                                                         |   | 7,765,583  |   |   | 7,765,583    |  
|Deficit accumulated during the development stage                                                                                                   |   | (9,834,117 | ) |   | (9,760,296   | )
|                                                                                                                                                   |   |            |   |   |              |  
|                                                                                                                                                   |   | (2,040,924 | ) |   | (1,967,103   | )
|                                                                                                                                                   |   |            |   |   |              |  
|                                                                                                                                                   | $ | 694        |   | $ | 311          |  

Nature of Operations and Ability to Continue as a Going Concern
 Note 1 Commitments  Notes 3 and 6

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|INTERIM STATEMENTS OF OPERATIONS            
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|                                                       |   |                    |   |   |                  |   |   | Cumulative from |  
|------------------------------------------------------ | - | ------------------ | - | - | ---------------- | - | - | --------------- | -
|                                                       |   |                    |   |   |                  |   |   | February 28,    |  
|                                                       |   |                    |   |   |                  |   |   | 1989 (Date of   |  
|                                                       |   | Three months ended |   |   | Six months ended |   |   | Inception) to   |  
|                                                       |   | June 30,           |   |   | June 30,         |   |   | June 30,        |  
|                                                       |   | 2010               |   |   | 2009             |   |   | 2010            |  
|                                                       |   |                    |   |   |                  |   |   |                 |  
|General and Administrative Expenses                    |   |                    |   |   |                  |   |   |                 |  
|Accounting and audit
      fees                        | $ | 26,171             |   | $ | 29,753           |   | $ | 43,811          |  
|Amortization                                           |   | -                  |   |   | -                |   |   | -               |  
|Communications                                         |   | 163                |   |   | 331              |   |   | 345             |  
|Consulting fees  Notes 5 and 6                        |   | -                  |   |   | 4,000            |   |   | -               |  
|Interest  Notes 3 and
      6                         |   | 13,305             |   |   | 12,047           |   |   | 26,146          |  
|Investor relations                                     |   | -                  |   |   | -                |   |   | -               |  
|Legal fees                                             |   | -                  |   |   | -                |   |   | -               |  
|Management fees  Note 6                               |   | -                  |   |   | -                |   |   | -               |  
|Office and general 
      Note 6                      |   | 120                |   |   | 651              |   |   | 180             |  
|Regulatory fees                                        |   | 3,227              |   |   | 5,146            |   |   | 3,877           |  
|Rent  Note 6                                          |   | -                  |   |   | -                |   |   | -               |  
|Transfer agent fees (recovery)                         |   | 375                |   |   | 125              |   |   | 750             |  
|Travel                                                 |   | -                  |   |   | -                |   |   | -               |  
|Loss on disposal of equipment                          |   | -                  |   |   | -                |   |   | -               |  
|Write-down of
      advances to related party          |   | -                  |   |   | -                |   |   | -               |  
|                                                       |   |                    |   |   |                  |   |   |                 |  
|Operating loss                                         |   | (43,361            | ) |   | (52,053          | ) |   | (75,109         | )
|                                                       |   |                    |   |   |                  |   |   |                 |  
|Unauthorized
      distribution                        |   | -                  |   |   | -                |   |   | -               |  
|Termination fee                                        |   | -                  |   |   | -                |   |   | -               |  
|Gain (loss) on foreign
      exchange                  |   | 7,401              |   |   | (9,644           | ) |   | 1,288           |  
|Gain on settlement of payables                         |   | -                  |   |   | -                |   |   | -               |  
|Write-down of
      deferred investment costs  Note 2 |   | -                  |   |   | (1               | ) |   | -               |  
|                                                       |   |                    |   |   |                  |   |   |                 |  
|Net loss for the period                                | $ | (35,960            | ) | $ | (61,698          | ) | $ | (73,821         | )
|                                                       |   |                    |   |   |                  |   |   |                 |  
|Basic and diluted loss per share                       | $ | (0.00              | ) | $ | (0.00            | ) | $ | (0.00           | )
|                                                       |   |                    |   |   |                  |   |   |                 |  
|Weighted average number of common shares outstanding   |   | 27,610,326         |   |   | 27,610,326       |   |   | 27,610,326      |  

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|INTERIM STATEMENTS OF CASH FLOWS            
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|                                                                                  |   |                           |   |   |                        |   |   | Cumulative from            |  
|--------------------------------------------------------------------------------- | - | ------------------------- | - | - | ---------------------- | - | - | -------------------------- | -
|                                                                                  |   |                           |   |   |                        |   |   | February 28, 1989 (Date of |  
|                                                                                  |   | Six months ended June 30, |   |   | Inception) to June 30, |  
|                                                                                  |   | 2010                      |   |   | 2009                   |   |   | 2010                       |  
|Operating Activities                                                              |   |                           |   |   |                        |   |   |                            |  
|Net loss for the period                                                           | $ | (73,821                   | ) | $ | (91,849                | ) | $ | (7,194,699                 | )
|Adjustments to reconcile net loss to net cash
      used in operating activities: |   |                           |   |   |                        |   |   |                            |  
|Amortization                                                                      |   | -                         |   |   | -                      |   |   | 3,616                      |  
|Beneficial
      conversion feature on convertible debt                           |   | -                         |   |   | -                      |   |   | 239,662                    |  
|Communications                                                                    |   | -                         |   |   | -                      |   |   | 28,000                     |  
|Consulting
      fees                                                             |   | -                         |   |   | 10,000                 |   |   | 2,478,554                  |  
|Gain on settlement of payables                                                    |   | -                         |   |   | -                      |   |   | (25,233                    | )
|Net
      interest accrued on loans                                               |   | 26,146                    |   |   | 23,674                 |   |   | 118,752                    |  
|Legal fees                                                                        |   | -                         |   |   | -                      |   |   | 25,000                     |  
|Loss on
      disposal of equipment                                               |   | -                         |   |   | -                      |   |   | 1,481                      |  
|Management fees                                                                   |   | -                         |   |   | -                      |   |   | 7,000                      |  
|Stock-based
      compensation                                                    |   | -                         |   |   | -                      |   |   | 736,053                    |  
|Termination fees                                                                  |   | -                         |   |   | -                      |   |   | 792,000                    |  
|Write-down
      of deferred costs                                                |   | -                         |   |   | 1                      |   |   | 34,210                     |  
|Write-down of advances to related party                                           |   | -                         |   |   | -                      |   |   | 606,337                    |  
|Changes in non-cash item:                                                         |   |                           |   |   |                        |   |   |                            |  
|Prepaid expenses                                                                  |   | (655                      | ) |   | -                      |   |   | (655                       | )
|Accounts payable                                                                  |   | 12,020                    |   |   | 11,690                 |   |   | 700,667                    |  
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Net cash used in
      operating activities                                       |   | (36,310                   | ) |   | (46,484                | ) |   | (1,449,255                 | )
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Investing Activities                                                              |   |                           |   |   |                        |   |   |                            |  
|Organization costs                                                                |   | -                         |   |   | -                      |   |   | (750                       | )
|Acquisition of capital assets                                                     |   | -                         |   |   | -                      |   |   | (4,347                     | )
|Deferred investment costs                                                         |   | -                         |   |   | -                      |   |   | (34,210                    | )
|Advances to
      related party                                                   |   | -                         |   |   | -                      |   |   | (606,337                   | )
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Net cash used in
      investing activities                                       |   | -                         |   |   | -                      |   |   | (645,644                   | )
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Financing Activities                                                              |   |                           |   |   |                        |   |   |                            |  
|Loans payable                                                                     |   | 36,038                    |   |   | 46,977                 |   |   | 921,609                    |  
|Due to related parties                                                            |   | -                         |   |   | -                      |   |   | 15,526                     |  
|Proceeds from issuance of common
      stock                                      |   | -                         |   |   | -                      |   |   | 1,162,631                  |  
|Payment of offering costs                                                         |   | -                         |   |   | -                      |   |   | (30,270                    | )
|Additional paid-in capital                                                        |   | -                         |   |   | -                      |   |   | 25,442                     |  
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Net cash provided by financing activities                                         |   | 36,038                    |   |   | 46,977                 |   |   | 2,094,938                  |  
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Increase (decrease) in cash during the
      period                               |   | (272                      | ) |   | 493                    |   |   | 39                         |  
|Cash, beginning of
      the period                                               |   | 311                       |   |   | 256                    |   |   | -                          |  
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Cash, end of the
      period                                                     | $ | 39                        |   | $ | 749                    |   | $ | 39                         |  
|                                                                                  |   |                           |   |   |                        |   |   |                            |  
|Supplementary disclosure of cash flows:                                           |   |                           |   |   |                        |   |   |                            |  
|Cash paid for Interest                                                            | $ | -                         |   | $ | -                      |   | $ | 93,859                     |  

Non-cash Transactions  Note 5

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED                                    
|--------------------------------------------------------------------------------
|(A Development Stage Company)                                                   
|INTERIM STATEMENTS OF CHANGES IN CAPITAL DEFICIT                                
|For the period from February 28, 1989 (Date of Inception)
      to June 30, 2010
|(Stated in U.S. Dollars)                                                        
|(Unaudited)                                                                     

|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   | Deficit     |   |   |         |  
|---------------------------------------------------------------------------------------------------------- | ---------- |  | ------------ |  | - | --------------- |  | - | ----------- |  | - | ----------- | - | - | ------- | -
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   | Accumulated |   |   |         |  
|                                                                                                           |            |  |              |  |   |                 |  |   | Additional  |  |   | During the  |   |   |         |  
|                                                                                                           |            |  | Common Stock |  |   | Paid-In         |  |   | Development |  |   |             |  
|                                                                                                           |            |  | Shares       |  |   | Par
      Value |  |   | Capital     |  |   | Stage       |   |   | Total   |  
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, February 28, 1989                                                                                 |            |  | -            |  | $ | -               |  | $ | -           |  | $ | -           |   | $ | -       |  
|Issuance of stock to insiders on
      March 7, 1989                                                       |  at $0.30 |  | 33,347       |  |   | 33              |  |   | 9,967       |  |   | -           |   |   | 10,000  |  
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance December 31, 1989                                                                                  |            |  | 33,347       |  |   | 33              |  |   | 9,967       |  |   | -           |   |   | 10,000  |  
|Issuance of
      stock during public offering for $3.00 per share, net of offering costs of
      $27,270 |            |  | 33,348       |  |   | 33              |  |   | 72,697      |  |   | -           |   |   | 72,730  |  
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (84,159     | ) |   | (84,159 | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1990                                                                                 |            |  | 66,695       |  |   | 66              |  |   | 82,664      |  |   | (84,159     | ) |   | (1,429  | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (3,416      | ) |   | (3,416  | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1991                                                                                 |            |  | 66,695       |  |   | 66              |  |   | 82,664      |  |   | (85,575     | ) |   | (4,845  | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (2,713      | ) |   | (2,713  | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1992                                                                                 |            |  | 66,695       |  |   | 66              |  |   | 82,664      |  |   | (90,288     | ) |   | (7,558  | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (1,614      | ) |   | (1,614  | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1993                                                                                 |            |  | 66,695       |  |   | 66              |  |   | 82,664      |  |   | (91,902     | ) |   | (9,172  | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (1,863      | ) |   | (1,863  | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance December 31, 1994                                                                                  |            |  | 66,695       |  |   | 66              |  |   | 82,664      |  |   | (93,765     | ) |   | (11,035 | )
|Issuance
      of stock for services rendered                                                              |  at $0.03 |  | 50,000       |  |   | 50              |  |   | 1,450       |  |   | -           |   |   | 1,500   |  
|Contributed capital                                                                                        |            |  | -            |  |   | -               |  |   | 24,842      |  |   | -           |   |   | 24,842  |  
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (16,735     | ) |   | (16,735 | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1995                                                                                 |            |  | 116,695      |  |   | 116             |  | $ | 108,956     |  |   | (110,500    | ) |   | (1,428  | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (9,068      | ) |   | (9,068  | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance December 31, 1996                                                                                  |            |  | 116,695      |  |   | 116             |  |   | 108,956     |  |   | (119,568    | ) |   | (10,496 | )
|Issuance of
      stock for cash - $0.011                                                                  |            |  | 2,000,000    |  |   | 2,000           |  |   | 19,300      |  |   | -           |   |   | 21,300  |  
|Contributed capital                                                                                        |            |  | -            |  |   | -               |  |   | 600         |  |   | -           |   |   | 600     |  
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (22,261     | ) |   | (22,261 | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1997                                                                                 |            |  | 2,116,695    |  |   | 2,116           |  |   | 128,856     |  |   | (141,829    | ) |   | (10,857 | )
|Issuance of stock services                                                                                 |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|- at
      $0.001                                                                                          |            |  | 7,000,000    |  |   | 7,000           |  |   | -           |  |   | -           |   |   | 7,000   |  
|- at $0.01                                                                                                 |            |  | 620,000      |  |   | 620             |  |   | 5,580       |  |   | -           |   |   | 6,200   |  
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (52,308     | ) |   | (52,308 | )
|                                                                                                           |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |         |  
|Balance, December 31, 1998                                                                                 |            |  | 9,736,695    |  |   | 9,736           |  |   | 134,436     |  |   | (194,137    | ) |   | (49,965 | )
|Net loss                                                                                                   |            |  | -            |  |   | -               |  |   | -           |  |   | (35,995     | ) |   | (35,995 | )

Contd

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED                                    
|--------------------------------------------------------------------------------
|(A Development Stage Company)                                                   
|INTERIM STATEMENTS OF CHANGES IN CAPITAL DEFICIT                                
|For the period from February 28, 1989 (Date of Inception)
      to June 30, 2010
|(Stated in U.S. Dollars)                                                        
|(Unaudited)                                                                     

|                                                                 |             |  |              |  |   |                 |  |   |             |   |   | Deficit     |   |   |            |  
|---------------------------------------------------------------- | ----------- |  | ------------ |  | - | --------------- |  | - | ----------- | - | - | ----------- | - | - | ---------- | -
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   | Accumulated |   |   |            |  
|                                                                 |             |  |              |  |   |                 |  |   | Additional  |   |   | During the  |   |   |            |  
|                                                                 |             |  | Common Stock |  |   | Paid-In         |  |   | Development |   |   |             |  
|                                                                 |             |  | Shares       |  |   | Par
      Value |  |   | Capital     |   |   | Stage       |   |   | Total      |  
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   |             |   |   |            |  
|Balance, December 31, 1999                                       |             |  | 9,736,695    |  | $ | 9,736           |  | $ | 134,436     |   | $ | (230,132    | ) | $ | (85,960    | )
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   |             |   |   |            |  
|Issuance of
      stock for cash pursuant to a private placement |  at $0.30  |  | 1,133,334    |  |   | 1,133           |  |   | 338,867     |   |   | -           |   |   | 340,000    |  
|Issue of stock for finders fee                                  |             |  | 50,000       |  |   | 50              |  |   | (50         | ) |   | -           |   |   | -          |  
|Net loss                                                         |             |  | -            |  |   | -               |  |   | -           |   |   | (336,431    | ) |   | (336,431   | )
|Non-cash compensation charge                                     |             |  | -            |  |   | -               |  |   | 78,707      |   |   | -           |   |   | 78,707     |  
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   |             |   |   |            |  
|Balance December 31, 2000                                        |             |  | 10,920,029   |  |   | 10,919          |  |   | 551,960     |   |   | (566,563    | ) |   | (3,684     | )
|Issuance of
      stock for services                             |  at $0.50  |  | 328,356      |  |   | 328             |  |   | 163,851     |   |   | -           |   |   | 164,179    |  
|                                                                 | - at $1.55  |  | 13,383       |  |   | 13              |  |   | 20,731      |   |   | -           |   |   | 20,744     |  
|                                                                 | - at $3.50  |  | 366,667      |  |   | 367             |  |   | 1,282,964   |   |   | -           |   |   | 1,283,331  |  
|Issuance of stock for cash
      pursuant to a private placement | - at $0.30  |  | 883,332      |  |   | 883             |  |   | 264,117     |   |   | -           |   |   | 265,000    |  
|Issuance of
      stock pursuant to the exercise of warrants     | - at $2.00  |  | 28,800       |  |   | 29              |  |   | 57,571      |   |   | -           |   |   | 57,600     |  
|Less: Issue costs                                                |             |  | -            |  |   | -               |  |   | (17,858     | ) |   | -           |   |   | (17,858    | )
|Net loss                                                         |             |  | -            |  |   | -               |  |   | -           |   |   | (2,296,406  | ) |   | (2,296,406 | )
|Non-cash compensation charge                                     |             |  | -            |  |   | -               |  |   | 136,378     |   |   | -           |   |   | 136,378    |  
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   |             |   |   |            |  
|Balance, December 31, 2001                                       |             |  | 12,540,567   |  |   | 12,539          |  |   | 2,459,714   |   |   | (2,862,969  | ) |   | (390,716   | )
|Issuance of
      stock for prepaid consulting                   |             |  |              |  |   |                 |  |   |             |   |   | -           |   |   |            |  
|                                                                 | - at $0.35  |  | 80,000       |  |   | 80              |  |   | 27,920      |   |   | -           |   |   | 28,000     |  
|Issuance of
      stock for deferred costs                       | - at $0.05  |  | 1,300,000    |  |   | 1,300           |  |   | 63,700      |   |   | -           |   |   | 65,000     |  
|Issuance of stock for services                                   |  at $0.05  |  | 100,000      |  |   | 100             |  |   | 4,900       |   |   | -           |   |   | 5,000      |  
|                                                                 | - at $0.055 |  | 60,000       |  |   | 60              |  |   | 3,240       |   |   | -           |   |   | 3,300      |  
|                                                                 | - at $0.10  |  | 105,000      |  |   | 105             |  |   | 10,395      |   |   | -           |   |   | 10,500     |  
|                                                                 | - at $0.148 |  | 27,000       |  |   | 27              |  |   | 3,973       |   |   | -           |   |   | 4,000      |  
|                                                                 | - at $0.20  |  | 175,000      |  |   | 175             |  |   | 34,825      |   |   | -           |   |   | 35,000     |  
|                                                                 | - at $0.209 |  | 17,143       |  |   | 17              |  |   | 3,583       |   |   | -           |   |   | 3,600      |  
|                                                                 | - at $0.35  |  | 120,000      |  |   | 120             |  |   | 41,880      |   |   | -           |   |   | 42,000     |  
|Issuance of
      stock for debt                                 |  at $0.20  |  | 458,135      |  |   | 458             |  |   | 91,169      |   |   | -           |   |   | 91,627     |  
|                                                                 | - at $0.209 |  | 222,751      |  |   | 223             |  |   | 46,156      |   |   | -           |   |   | 46,379     |  
|Net loss                                                         |             |  | -            |  |   | -               |  |   | -           |   |   | (214,758    | ) |   | (214,758   | )
|                                                                 |             |  |              |  |   |                 |  |   |             |   |   |             |   |   |            |  
|Balance, December 31, 2002                                       |             |  | 15,205,596   |  |   | 15,204          |  |   | 2,791,455   |   |   | (3,077,727  | ) |   | (271,068   | )
|Non-cash compensation
      charge                               |             |  | -            |  |   | -               |  |   | 53,500      |   |   | -           |   |   | 53,500     |  
|Issue of
      stock for services                                |  at $0.14  |  | 1,450,000    |  |   | 1,450           |  |   | 201,550     |   |   | -           |   |   | 203,000    |  
|Issue of stock for
      cash pursuant to a private placement    |  at $0.10  |  | 650,000      |  |   | 650             |  |   | 64,350      |   |   | -           |   |   | 65,000     |  
|Net loss                                                         |             |  | -            |  |   | -               |  |   | -           |   |   | (1,208,941  | ) |   | (1,208,941 | )

Contd

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED                                    
|--------------------------------------------------------------------------------
|(A Development Stage Company)                                                   
|INTERIM STATEMENTS OF CHANGES IN CAPITAL DEFICIT                                
|For the period from February 28, 1989 (Date of Inception)
      to June 30, 2010
|(Stated in U.S. Dollars)                                                        
|(Unaudited)                                                                     

|                                                                   |            |  |              |   |   |                 |   |   |             |   |   | Deficit     |   |   |            |  
|------------------------------------------------------------------ | ---------- |  | ------------ | - | - | --------------- | - | - | ----------- | - | - | ----------- | - | - | ---------- | -
|                                                                   |            |  |              |   |   |                 |   |   |             |   |   | Accumulated |   |   |            |  
|                                                                   |            |  |              |   |   |                 |   |   | Additional  |   |   | During the  |   |   |            |  
|                                                                   |            |  | Common Stock |   |   | Paid-In         |   |   | Development |   |   |             |  
|                                                                   |            |  | Shares       |   |   | Par
      Value |   |   | Capital     |   |   | Stage       |   |   | Total      |  
|                                                                   |            |  |              |   |   |                 |   |   |             |   |   |             |   |   |            |  
|Balance, December 31, 2003                                         |            |  | 17,305,596   |   | $ | 17,304          |   | $ | 3,110,855   |   | $ | (4,286,668  | ) | $ | (1,158,509 | )
|Non-cash compensation
      charge                                 |            |  | -            |   |   | -               |   |   | 161,450     |   |   | -           |   |   | 161,450    |  
|Issue of stock for cash
      pursuant to the exercise of warrants |  at $0.10 |  | 320,000      |   |   | 320             |   |   | 31,680      |   |   | -           |   |   | 32,000     |  
|                                                                   |  at $0.05 |  | 643,715      |   |   | 644             |   |   | 31,542      |   |   | -           |   |   | 32,186     |  
|Issue of stock for cash
      pursuant to the exercise of options  |  at $0.25 |  | 205,000      |   |   | 205             |   |   | 51,045      |   |   | -           |   |   | 51,250     |  
|Issue of stock for debt                                            |  at $0.05 |  | 563,000      |   |   | 563             |   |   | 29,437      |   |   | -           |   |   | 30,000     |  
|                                                                   |  at $0.06 |  | 825,364      |   |   | 825             |   |   | 47,712      |   |   | -           |   |   | 48,537     |  
|                                                                   |  at $0.30 |  | 50,000       |   |   | 50              |   |   | 14,950      |   |   | -           |   |   | 15,000     |  
|Issuance
      of stock for services                               |  at $2.00 |  | 10,000       |   |   | 10              |   |   | 19,990      |   |   | -           |   |   | 20,000     |  
|                                                                   |  at $0.35 |  | 350,000      |   |   | 350             |   |   | 122,150     |   |   | -           |   |   | 122,500    |  
|Cancellation of stock issued for deferred costs                    |  at $0.05 |  | (1,300,000   | ) |   | (1,300          | ) |   | (63,700     | ) |   | -           |   |   | (65,000    | )
|Net loss                                                           |            |  | -            |   |   | -               |   |   | -           |   |   | (517,324    | ) |   | (517,324   | )
|                                                                   |            |  |              |   |   |                 |   |   |             |   |   |             |   |   |            |  
|Balance, December 31, 2004                                         |            |  | 18,972,675   |   |   | 18,971          |   |   | 3,557,111   |   |   | (4,803,992  | ) |   | (1,227,910 | )
|Non-cash
      compensation charge                                 |            |  | -            |   |   | -               |   |   | 25,700      |   |   | -           |   |   | 25,700     |  
|Issue of stock for cash pursuant to the
      exercise of warrants |  at $0.07 |  | 75,820       |   |   | 76              |   |   | 5,232       |   |   | -           |   |   | 5,308      |  
|                                                                   |  at $0.10 |  | 357,760      |   |   | 358             |   |   | 35,417      |   |   | -           |   |   | 35,775     |  
|                                                                   |  at $0.11 |  | 299,724      |   |   | 300             |   |   | 31,270      |   |   | -           |   |   | 31,570     |  
|                                                                   |  at $0.21 |  | 16,803       |   |   | 17              |   |   | 3,483       |   |   | -           |   |   | 3,500      |  
|Issue of stock for debt                                            |  at $0.39 |  | 635,901      |   |   | 636             |   |   | 249,524     |   |   | -           |   |   | 250,160    |  
|Issuance
      of stock for services                               |  at $0.25 |  | 950,000      |   |   | 950             |   |   | 236,550     |   |   | -           |   |   | 237,500    |  
|                                                                   |  at $0.36 |  | 100,000      |   |   | 100             |   |   | 35,900      |   |   | -           |   |   | 36,000     |  
|                                                                   |  at $0.50 |  | 121,000      |   |   | 121             |   |   | 60,379      |   |   | -           |   |   | 60,500     |  
|                                                                   |  at $0.54 |  | 20,000       |   |   | 20              |   |   | 10,680      |   |   | -           |   |   | 10,700     |  
|                                                                   |  at $0.84 |  | 50,000       |   |   | 50              |   |   | 41,950      |   |   | -           |   |   | 42,000     |  
|Issuance of stock
      dividend                                   |  at $0.65 |  | 4,060,643    |   |   | 4,061           |   |   | 2,635,357   |   |   | (2,639,418  | ) |   | -          |  
|Net loss                                                           |            |  | -            |   |   | -               |   |   | -           |   |   | (517,270    | ) |   | (517,270   | )
|                                                                   |            |  |              |   |   |                 |   |   |             |   |   |             |   |   |            |  
|Balance, December 31, 2005                                         |            |  | 25,660,326   |   |   | 25,660          |   |   | 6,928,553   |   |   | (7,960,680  | ) |   | (1,006,467 | )
|                                                                   |            |  |              |   |   |                 |   |   |             |   |   |             |   |   |            |  
|Issue of stock for cash pursuant to a private placement            |  at $0.40 |  | 200,000      |   |   | 200             |   |   | 79,800      |   |   | -           |   |   | 80,000     |  
|Issue of stock for
      finders fee                              |  at $0.40 |  | 100,000      |   |   | 100             |   |   | 39,900      |   |   | -           |   |   | 40,000     |  
|Share
      issue costs                                            |            |  | -            |   |   | -               |   |   | (43,000     | ) |   | -           |   |   | (43,000    | )
|Beneficial
      conversion feature on convertible debt            |            |  | -            |   |   | -               |   |   | 77,800      |   |   | -           |   |   | 77,800     |  
|Net loss                                                           |            |  | -            |   |   | -               |   |   | -           |   |   | (401,655    | ) |   | (401,655   | )

Contd

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED                                    
|--------------------------------------------------------------------------------
|(A Development Stage Company)                                                   
|INTERIM STATEMENTS OF CHANGES IN CAPITAL DEFICIT                                
|For the period from February 28, 1989 (Date of Inception)
      to June 30, 2010
|(Stated in U.S. Dollars)                                                        
|(Unaudited)                                                                     

|                                                              |            |  |              |  |   |                 |  |   |             |  |   | Deficit     |   |   |            |  
|------------------------------------------------------------- | ---------- |  | ------------ |  | - | --------------- |  | - | ----------- |  | - | ----------- | - | - | ---------- | -
|                                                              |            |  |              |  |   |                 |  |   |             |  |   | Accumulated |   |   |            |  
|                                                              |            |  |              |  |   |                 |  |   | Additional  |  |   | During the  |   |   |            |  
|                                                              |            |  | Common Stock |  |   | Paid-In         |  |   | Development |  |   |             |  
|                                                              |            |  | Shares       |  |   | Par
      Value |  |   | Capital     |  |   | Stage       |   |   | Total      |  
|                                                              |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |            |  
|Balance, December 31, 2006                                    |            |  | 25,960,326   |  | $ | 25,960          |  | $ | 7,083,053   |  | $ | (8,362,335  | ) | $ | (1,253,322 | )
|Issue of stock for cash pursuant
      to a private placement |  at $0.25 |  | 200,000      |  |   | 200             |  |   | 49,800      |  |   | -           |   |   | 50,000     |  
|Issuance of stock for
      services                          |  at $0.20 |  | 700,000      |  |   | 700             |  |   | 139,300     |  |   | -           |   |   | 140,000    |  
|Non-cash compensation charge                                  |            |  | -            |  |   | -               |  |   | 29,240      |  |   | -           |   |   | 29,240     |  
|Beneficial conversion feature on convertible debt             |            |  | -            |  |   | -               |  |   | 39,600      |  |   | -           |   |   | 39,600     |  
|Net loss                                                      |            |  | -            |  |   | -               |  |   | -           |  |   | (519,345    | ) |   | (519,345   | )
|                                                              |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |            |  
|Balance, December 31, 2007                                    |            |  | 26,860,326   |  |   | 26,860          |  |   | 7,340,993   |  |   | (8,881,680  | ) |   | (1,513,827 | )
|Issuance of stock for
      services                          |  at $0.07 |  | 750,000      |  |   | 750             |  |   | 51,250      |  |   | -           |   |   | 52,000     |  
|Non-cash compensation charge                                  |            |  | -            |  |   | -               |  |   | 251,078     |  |   | -           |   |   | 251,078    |  
|Beneficial conversion feature on convertible debt             |            |  | -            |  |   | -               |  |   | 122,262     |  |   | -           |   |   | 122,262    |  
|Net loss                                                      |            |  | -            |  |   | -               |  |   | -           |  |   | (723,811    | ) |   | (723,811   | )
|                                                              |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |            |  
|Balance, December 31, 2008                                    |            |  | 27,610,326   |  |   | 27,610          |  |   | 7,765,583   |  |   | (9,605,491  | ) |   | (1,812,298 | )
|Net loss                                                      |            |  | -            |  |   | -               |  |   | -           |  |   | (154,805    | ) |   | (154,805   | )
|                                                              |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |            |  
|Balance, December 31, 2009                                    |            |  | 27,610,326   |  |   | 27,610          |  |   | 7,765,583   |  |   | (9,760,296  | ) |   | (1,967,103 | )
|Net loss                                                      |            |  | -            |  |   | -               |  |   | -           |  |   | (73,821     | ) |   | (73,821    | )
|                                                              |            |  |              |  |   |                 |  |   |             |  |   |             |   |   |            |  
|Balance, June 30,
      2010                                  |            |  | 27,610,326   |  | $ | 27,610          |  | $ | 7,765,583   |  | $ | (9,834,117  | ) | $ | (2,040,924 | )

SEE ACCOMPANYING NOTES

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|1. | Nature of Operations and Ability to Continue as a
      Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The Company is in the development stage and is devoting
      its efforts to exploring new investment opportunities, including real
      estate development projects.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | These financial statements have been prepared in
      accordance with generally accepted accounting principles applicable to a
      going concern, which assumes that the Company will be able to meet its
      obligations and continue its operations for its next fiscal year.
      Realization values may be substantially different from carrying values as
      shown and these financial statements do not give effect to adjustments
      that would be necessary to the carrying values and classification of
      assets and liabilities should the Company be unable to continue as a going
      concern. At June 30, 2010, the Company had not yet achieved profitable
      operations, has an accumulated deficit of $9,834,117 since its inception,
      has a working capital deficiency of $1,248,924 and expects to incur
      further losses in the development of its business, all of which casts
      substantial doubt about the Companys ability to continue as a going
      concern. In addition to funding the Companys general, administrative and
      corporate expenses the Company is obligated to address its current
      obligations totalling $1,249,618. To the extent that cash needs are not
      achieved from operating cash flow and existing cash on hand, the Company
      will be required to raise necessary cash through shareholder loans, equity
      issuances and/or other debt financing. Amounts raised will be used to
      continue the development of the Company's investment activities, and for
      other working capital purposes.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The Companys ability to continue as a going concern is
      dependent upon its ability to generate future profitable operations and/or
      to obtain the necessary financing to meet its obligations and repay its
      liabilities arising from normal business operations when they come due.
      Management has no formal plan in place to address this concern but
      considers that the Company will be able to obtain additional funds by
      equity financing and/or related party advances; however there is no
      assurance of additional funding being available. The Company has
      historically satisfied its capital needs primarily by issuing equity
      securities. Management plans to continue to provide for its capital needs
      during the year ended December 31, 2010, by issuing equity securities
      and/or related party advances.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The accompanying unaudited interim financial statements
      have been prepared by the Company pursuant to the rules and regulations of
      the United States Securities and Exchange Commission. Certain information
      and disclosures normally included in annual financial statements prepared
      in accordance with accounting principles generally accepted in the United
      States of America have been condensed or omitted pursuant to such rules
      and regulations. In the opinion of management, all adjustments and
      disclosures necessary for a fair presentation of these financial
      statements have been included. Such adjustments consist of normal
      recurring adjustments. These interim financial statements should be read
      in conjunction with the annual audited financial statements of the Company
      for the fiscal year ended December 31, 2009, included in the Companys
      10-K Annual Report as filed with the United States Securities and Exchange
      Commission.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The results of operations for the six months ended June
      30, 2010 are not indicative of the results that may be expected for the
      full year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|2. | Deferred Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | Deferred costs consist of consultants fees and payments
      to reimburse Star Leisure and Entertainment Inc. (Star Leisure) with
      respect to the acquisition of Gulf Star World Development W.L.L (Gulf
      Star). By a letter of agreement dated July 11, 2002, the Company agreed
      to purchase 80% of the outstanding shares of Gulf Star, a Bahrain
      corporation, from Star Leisure. Star Leisure is controlled by a director
      of the Company. Gulf Star is the 100% owner and developer of the
      residential and tourist project known as the Dream Island Resort, located
      in Bahrain. In 2005, due to the uncertainty of the future viability of the
      Dream Island project, the Company wrote-down the associated deferred
      investment costs to a nominal value of $1. On May 20, 2009 the letter of
      agreement was terminated and the remaining related investment costs
      written-off.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

1

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|3. | Loans Payable
|-- | -------------

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | June 30,  |  |  | December 31,
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------- |  |  | ------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 2010      |  |  | 2009        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |           |  |  |             
|a) | Loan payable to a company
            controlled by a director of the Company including accrued interest of
            $5,838 (December 31, 2009 - $5,118). The loan is unsecured, bearing
            interest at 12% per annum and is repayable on demand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | $ 12,640  |  |  | $ 11,920    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |           |  |  |             
|b) | Loans payable to companies
            controlled by directors of the Company. The loans are unsecured,
            non-interest bearing, and repayable upon demand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | 142,366   |  |  | 106,329     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |           |  |  |             
|c) | Loan payable to a company
            controlled by a director of the Company, including accrued interest
            payable of $46,715 (December 31, 2009 - $36,653), pursuant to a
            Convertible Loan Agreement. The loan is unsecured, bearing interest at 10%
            per annum and is repayable on demand. The lender may at anytime convert
            the principal sum into units of the Company. Each unit will consist of one
            common share plus one common share purchase warrant. The principal sum of
            $163,766 may be converted into 2,320,858 units. Conversion of these loans
            and resulting associated warrants to equity will be based on the
            conversion price set at the time the principal amount was drawn ranging
            from $0.05 to $0.23. Upon conversion of this loan, warrants with a fair
            value of $73,685 will be recognized as an interest expense and credited to
            additional paid-in capital. |  | 210,481   |  |  | 200,419     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |           |  |  |             
|d) | Loan payable to a company controlled by a director of the
            Company, including accrued interest of $66,200 (December 31, 2009 -
            $50,835), pursuant to a Convertible Loan Agreement. The loan is unsecured,
            bearing interest at 10% per annum and is repayable on demand. The lender
            may at anytime convert the principal sum into units of the Company. Each
            unit will consist of one common share plus one common share purchase
            warrant. The principal sum of $255,209 may be converted into 4,526,436
            units. Conversion of this loan and resulting associated warrants to equity
            will be based on the conversion price set at the time the principal amount
            was drawn ranging from $0.05 to $0.12. Upon conversion of this loan,
            warrants with a fair value of $113,338 will be recognized as an interest
            expense and credited to additional paid-in capital.                      |  | 321,409   |  |  | 306,044     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |           |  |  |             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | $ 686,896 |  |  | $ 624,712   

2

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|4. | Capital Stock Notes 3 and 5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | Class A Convertible Preferred Shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Class A convertible preferred shares issued in 2003
      have a par value of $0.001 and are convertible to common shares at $4.00
      per share during the first 180 days following issuance, and thereafter at
      the average of twenty consecutive days closing prices, but shall not be
      less than $1.50 per share or greater than $6.00 per share. The Company has
      the right to redeem its Class A convertible preferred stock at any time by
      paying to the holders thereof the sum of $4 per share.                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The aggregate liquidation value of the Class A
      convertible preferred shares is $792,000. A merger or consolidation of the
      Company that results in the Companys stockholders immediately prior to
      the transaction not holding at least 50% of the voting power of the
      surviving entity shall be deemed a liquidation event.                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | Stock Option Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Companys board of directors approved a stock option
      plan. Under the plan directors, employees and consultants may be granted
      options to purchase common stock of the Company at a price of not less
      than 100% of the fair market value of the stock. The total number of
      options granted must not exceed 15% of the outstanding common stock of the
      Company. The plan expires on July 1, 2017.                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | Stock-based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | In previous periods, the Company granted share purchase
      options to directors, employees, and consultants of the Company at the closing price of the Companys common
      stock on the date of the grants. The options have been granted with a term
    of 5 years.                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The fair value of each option grant was estimated on the
      date of the grant using the Black-Scholes option valuation model. The
      Black-Scholes option valuation model requires the input of highly
      subjective assumptions including the expected price volatility. Changes in
      the subjective input assumptions can materially affect the fair value
      estimate and therefore the Black-Scholes model does not necessarily
      provide a reliable single measure of the fair value of the Companys share purchase options.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | During the six-month periods ended June 30, 2010 and 2009
      the Company did not grant any stock options to
  consultants.                                                                                                                                                                                                                                                                                                                                                                                                                         

3

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|4. | Capital Stock Notes 3 and 5  (contd)                                                                      
|-- | -------------------------------------------------------------------------------------------------------------
|   |                                                                                                              
|   | Stock-based Compensation  (contd)                                                                          
|   |                                                                                                              
|   | During the period ended June 30, 2010, the change in
      share purchase options outstanding are as
follows:

| |                                            |  |           |   |   | Weighted |  |  | Weighted         |  |   |           | 
| | ------------------------------------------ |  | --------- | - | - | -------- |  |  | ---------------- |  | - | --------- | 
| |                                            |  |           |   |   | Average  |  |  | Average          |  |   | Aggregate | 
| |                                            |  |           |   |   | Exercise |  |  | Remaining        |  |   | Intrinsic | 
| |                                            |  | Shares    |   |   | Price    |  |  | Contractual Life |  |   | Value     | 
| |                                            |  |           |   |   |          |  |  |                  |  |   |           | 
| | Options outstanding at December 31, 2008   |  | 4,125,000 |   | $ | 0.15     |  |  | 3.96 years       |  | $ | -         | 
| | Cancelled during
      the period          |  | (400,000  | ) | $ | 0.15     |  |  | 4.24
      years |  |   | -         | 
| | Options outstanding at December 31, 2009   |  | 3,725,000 |   | $ | 0.15     |  |  | 3.42 years       |  | $ | -         | 
| | Options
      outstanding at June 30, 2010 |  | 3,725,000 |   | $ | 0.15     |  |  | 2.92
      years |  | $ | -         | 

As at June 30, 2010, the Company had
share purchase options outstanding as follows:

| | Number of Options | Exercise Price | Expiry Date 
| | ----------------- | -------------- | ------------
| | 3,725,000         | $0.15          | June
1, 2013

As at June 30, 2010 and December 31,
2009 all of the outstanding share purchase options were exercisable.

4

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|5. | Non-Cash Transactions                                                                                                                                                                                                                                                                                      
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                            
|   | Investing and financing activities that do not have a
      direct impact on cash flows are excluded from the statements of cash
      flows. The Company issued common shares for settlement of debts,
      convertible loans, and for services provided to the Company during the
      following years:

| |                                   |  | Number of |  |  |               |   |   | Weighted        |  |   |           |  
| | --------------------------------- |  | --------- |  |  | ------------- | - | - | --------------- |  | - | --------- | -
| |                                   |  | Preferred |  |  | Number of     |   |   | Average Price   |  |   |           |  
| | Year                              |  | Shares    |  |  | Common Shares |   |   | Per
      Share |  |   | Total     |  
| |                                   |  |           |  |  |               |   |   |                 |  |   |           |  
| | 1995 Consulting fee               |  | -         |  |  | 50,000        |   | $ | 0.03            |  | $ | 1,500     |  
| | 1998 Management fee               |  | -         |  |  | 7,000,000     |   | $ | 0.001           |  |   | 7,000     |  
| | 1998 Consulting fee               |  | -         |  |  | 620,000       |   | $ | 0.01            |  |   | 6,200     |  
| | 2000 Finders fee                  |  | -         |  |  | 50,000        |   | $ | 0.001           |  |   | 50        |  
| | 2001 Consulting fee               |  | -         |  |  | 708,406       |   | $ | 2.07            |  |   | 1,468,254 |  
| | 2002 Deferred cost                |  | -         |  |  | 1,300,000     |   | $ | 0.05            |  |   | 65,000    |  
| | 2002 Consulting fee               |  | -         |  |  | 684,143       |   | $ | 0.19            |  |   | 131,400   |  
| | 2002 Debt settlement              |  | -         |  |  | 680,886       |   | $ | 0.20            |  |   | 138,006   |  
| | 2003 Consulting fee               |  | -         |  |  | 1,450,000     |   | $ | 0.14            |  |   | 203,000   |  
| | 2003 Termination fee              |  | 198,000   |  |  | -             |   | $ | 4.00            |  |   | 792,000   |  
| | 2004 Loan conversion              |  | -         |  |  | 825,364       |   | $ | 0.06            |  |   | 48,537    |  
| | 2004 Loan settlement              |  | -         |  |  | 613,000       |   | $ | 0.07            |  |   | 45,000    |  
| | 2004 Consulting fee               |  | -         |  |  | 360,000       |   | $ | 0.40            |  |   | 142,500   |  
| | 2004 Deferred cost (cancellation) |  | -         |  |  | (1,300,000    | ) | $ | 0.05            |  |   | (65,000   | )
| | 2005 Communications               |  | -         |  |  | 56,000        |   | $ | 0.50            |  |   | 28,000    |  
| | 2005 Consulting fees              |  | -         |  |  | 1,135,000     |   | $ | 0.29            |  |   | 333,700   |  
| | 2005 Legal fees                   |  | -         |  |  | 50,000        |   | $ | 0.50            |  |   | 25,000    |  
| | 2005 Loan conversion              |  | -         |  |  | 635,901       |   | $ | 0.39            |  |   | 250,160   |  
| | 2005 Stock dividend               |  | -         |  |  | 4,120,643     |   | $ | 0.65            |  |   | 2,678,418 |  
| | 2006 Finders fee                 |  | -         |  |  | 100,000       |   | $ | 0.40            |  |   | 40,000    |  
| | 2007 Consulting fees              |  | -         |  |  | 700,000       |   | $ | 0.20            |  |   | 140,000   |  
| | 2008 Consulting
      fees        |  | -         |  |  | 750,000       |   | $ | 0.07            |  |   | 52,000    |  
| |                                   |  |           |  |  |               |   |   |                 |  |   |           |  
| |                                   |  | 198,000   |  |  | 20,589,343    |   |   |                 |  | $ | 6,530,725 |  

These amounts have been excluded from
the investing and financing activities of the statements of cash flows.

5

---

|STRATEGIC INTERNET INVESTMENTS, INCORPORATED
|--------------------------------------------
|(A Development Stage Company)               
|NOTES TO THE INTERIM FINANCIAL STATEMENTS   
|June 30, 2010                               
|(Stated in U.S. Dollars)                    
|(Unaudited)                                 

|6. | Related Party Transactions Notes 2 and
  3                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                  
|   | The Company was charged the following by stockholders,
      directors, by companies controlled by directors and/or stockholders of the
      Company, and by companies with directors in
common:

| |                    |   |                    |  |   |                  |  |   |                        |  |   |          |  |   | Cumulative from   | 
| | ------------------ | - | ------------------ |  | - | ---------------- |  | - | ---------------------- |  | - | -------- |  | - | ----------------- | 
| |                    |   |                    |  |   |                  |  |   |                        |  |   |          |  |   | February 28, 1989 | 
| |                    |   | Three months ended |  |   | Six months ended |  |   | (Date of Inception) to | 
| |                    |   |                    |  |   | June 30,         |  |   | June 30,               |  |   | June 30, | 
| |                    |   | 2010               |  |   | 2009             |  |   | 2010                   |  |   | 2009     |  |   | 2010              | 
| |                    |   |                    |  |   |                  |  |   |                        |  |   |          |  |   |                   | 
| | Consulting fees    | $ | -                  |  | $ | -                |  | $ | -                      |  | $ | -        |  | $ | 249,043           | 
| | Interest           |   | 13,305             |  |   | 12,047           |  |   | 26,146                 |  |   | 23,674   |  |   | 334,327           | 
| | Management fees    |   | -                  |  |   | -                |  |   | -                      |  |   | -        |  |   | 546,325           | 
| | Office and general |   | -                  |  |   | -                |  |   | -                      |  |   | -        |  |   | 26,944            | 
| | Rent               |   | -                  |  |   | -                |  |   | -                      |  |   | -        |  |   | 130,232           | 
| |                    |   |                    |  |   |                  |  |   |                        |  |   |          |  |   |                   | 
| |                    | $ | 13,305             |  | $ | 12,047           |  | $ | 26,146                 |  | $ | 23,674   |  | $ | 1,286,871         | 

At June 30, 2010, accounts payable
includes $477,325 (December 31, 2009 - $475,026) due to directors of the Company
and companies controlled by directors of the Company in respect of unpaid
management fees and expenses incurred on behalf of the Company.

The Company entered into two Management
Services Agreements dated January 1, 2007 with a director and a company
controlled by a director of the Company. Under the terms of these agreements
they were each paid $7,500 per month, plus taxes where applicable, for
management services. These agreements were for a 24-month period and expired on
December 31, 2008. Effective September 12, 2008, one of the agreements was
terminated and the other was not renewed subsequent to December 31, 2008. If the
Company is unable to pay for the services, the consultant may elect to settle
any portion of outstanding amounts plus interest with units of the Company. Each
unit shall consist of one common share and one share purchase warrant entitling
the holder to purchase one additional common share of the Company. The price for
the units and warrants will be determined based on a discount to the 10 day
average market price ranging from 50% to 60%, but no less than $0.05 per share.

6

---

|2. | Managements Discussion and Analysis of Financial
      Condition and Results of Operations
|-- | -------------------------------------------------------------------------------------------

The following discussion should be read
in conjunction with our unaudited interim financial statements and the related
notes that appear elsewhere in this quarterly report. The following discussion
contains forward-looking statements that reflect our plans, estimates and
beliefs. Our actual results could differ materially from those discussed in the
forward looking statements. Factors that could cause or contribute to such
differences include those discussed below and elsewhere in this annual
report.

Our unaudited interim financial
statements are stated in United States dollars and are prepared in accordance
with United

States generally accepted accounting
principles (GAAP).

The Company is in the development
stage, accordingly certain matters discussed herein are based on potential
future circumstances and developments, which the Company anticipates, but which
cannot be assured.

Plan of Operation

The Company had been devoting its
business efforts to real estate development projects located in Bahrain and
Turkey. During April and May 2009, the Company terminated its involvement in
these projects. The Company plans to investigate new real estate development
projects during the remainder of its 2010 fiscal year and during 2011.

Our estimated cash expenses over the
next twelve months are as follows:

Accounting, audit, and legal fees
    $
    $60,000General and administrative expenses
    
    3,500Regulatory and transfer agent fees
    
    8,500$
    $72,000


The Company also estimates it will
accrue interest expenses of $52,000 over the next 12 months on loans due to
related parties. It is not anticipated the interest will be paid in cash during
2010, and therefore interest has been excluded from the above list of cash
expenses.

To date we have funded our operations
primarily with loans from shareholders and issue new equity. In addition to
funding the Companys general, administrative and corporate expenses the Company
is obligated to address its current obligations totalling $1,249,618. To the
extent that cash needs are not achieved from operating cash flow and existing
cash on hand, the Company will be required to raise necessary cash through
shareholder loans, equity issuances and/or other debt financing. Amounts raised
will be used to continue the development of the Company's investment activities,
and for other working capital purposes, which may be dilutive to existing
shareholders. The company currently has no agreement in place to raise funds for
current liabilities and no guarantee can be given that we will be able to raise
funds for this purpose on terms acceptable to the company. Failure to raise
funds for general, administrative and corporate expenses and current liabilities
could result in a severe curtailment of the company operations.

Any advance in the real estate
development strategy set-out herein will require additional funds. These funds
may be raised through equity financing, debt financing or other sources which
may result in further dilution of the shareholders percentage ownership in the
company.

Results of Operations

During the quarter ended June 30, 2010,
the Company incurred general and administrative expenses totaling
$43,361compared to $52,053 during the same period of the previous year.

The changes in our general and
administrative expenses for the six month period ended June 30, 2010 when
compared to the six month period ended June 30, 2009 was primarily due to:

| | a) | Although there has been a decrease in the volume of
      transactions and business activities compared to the prior year, there has
      been little change in the total accounting and audit fees due to a general
      increase in the fees charged by the professionals who provide these
      services. In addition, there has been an increase in the amount of time
      spent by these professionals to ensure the Company is in compliance with
      the increased reporting requirement imposed by regulatory
    authorities.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

| | b) | The June 30, 2009 consulting fees expense included a the
      prorated value of shares issued in June 2008 for 12 months of consulting
      services, while no new consulting agreements were entered into during the
      current period.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                              
| | c) | Interest on loans increased by $2,472, this is attributed
      to the compounding effect of the quarterly interest calculation as the
      Company has not been making any payments on these
debts.                                        

Funding for operating and investing
activities was provided by both non-interest and interest bearing advances and
loans from related parties, including directors of the Company, and companies
controlled by these directors.

As of June 30, 2010, the Company had
total current assets of $694 and total liabilities of $1,249,618. The Company
had cash of $39 and a working capital deficiency of $1,248,924 as of June 30,
2010 compared to cash on hand of $311 and a working capital deficiency of
$1,175,103, for the year ended December 31, 2009. We anticipate that we will
incur approximately $72,000 for cash operating expenses, including professional,
legal and accounting expenses associated with our reporting requirements under
the Exchange Act during the next twelve months. In addition to funding the
Companys general, administrative and corporate expenses the Company is
obligated to address its current obligations totaling $1,249,618. To the extent
that cash needs are not achieved from operating cash flow and existing cash on
hand, the Company will be required to raise necessary cash through shareholder
loans, equity issuances and/or other debt financing. Amounts raised will be used
to continue the development of the Company's investment activities, and for
other working capital purposes. Accordingly, we will need to obtain additional
financing in order to continue our planned business activities.

Cash used in operating activities for
the six month period ended June 30, 2010 was $36,310 as compared to cash used by
operating activities for the same period in 2009 of $46,484. The decrease in
cash used in operating activities was primarily due to the increase in accounts
payable, a reduction in regulatory fees, and foreign exchange gains.

The Company has the following loans
outstanding as of June 30, 2010:

A $12,640 loan payable to a company
controlled by a director of the Company including accrued interest of $5,838
(December 31, 2009 - $5,118). The loan is unsecured, bearing interest at 12% per
annum and is repayable on demand.

$142,366 in loans payable to companies
controlled by directors of the Company. These loans are unsecured, non-interest
bearing, and repayable upon demand.

A $210,481 loan payable to a company
controlled by a director of the Company, including accrued interest payable of
$46,715 (December 31, 2009 - $36,653), pursuant to a Convertible Loan Agreement.
The loan is unsecured, bearing interest at 10% per annum and is repayable on
demand. The lender may at anytime convert the principal sum into units of the
Company. Each unit will consist of one common share plus one common share
purchase warrant. The principal sum of $163,766 may be converted into 2,320,858
units. Conversion of these loans and resulting associated warrants to equity
will be based on the conversion price set at the time the principal amount was
drawn ranging from $0.05 to $0.23. Upon conversion of this loan, warrants with a
fair value of $73,685 will be recognized as an interest expense and credited to
additional paid-in capital.

A $321,409 loan payable to a company
controlled by a director of the Company, including accrued interest of $66,200
(December 31, 2009 - $50,835), pursuant to a Convertible Loan Agreement. The
loan is unsecured, bearing interest at 10% per annum and is repayable on demand.
The lender may at anytime convert the principal sum into units of the Company.
Each unit will consist of one common share plus one common share purchase
warrant. The principal sum of $255,209 may be converted into 4,526,436 units.
Conversion of this loan and resulting associated warrants to equity will be
based on the conversion price set at the time the principal amount was drawn
ranging from $0.05 to $0.12. Upon conversion of this loan, warrants with a fair
value of $113,338 will be recognized as an interest expense and credited to
additional paid-in capital.

Going Concern

The unaudited financial statements
accompanying this report have been prepared on a going concern basis, which
implies that our company will continue to realize its assets and discharge its
liabilities and commitments in the normal course of business. Our company has
not generated revenues since inception and has never paid any cash dividends and
is unlikely to pay cash dividends or generate earnings in the immediate or
foreseeable future. The continuation of our company as a going concern is
dependent upon the continued financial support from our shareholders, the
ability of our company to obtain necessary equity
financing to achieve our operating objectives, and the attainment of profitable
operations. As of June 30, 2010, we had cash of $39 and we estimate that we will
require approximately $72,000 to fund our business operations over the next
twelve months. In addition to funding the Companys general, administrative and
corporate expenses the Company is obligated to address its current obligations
totalling $1,249,618. To the extent that cash needs are not achieved from
operating cash flow and existing cash on hand, the Company will be required to
raise necessary cash through shareholder loans, equity issuances and/or other
debt financing. Amounts raised will be used to continue the development of the
Company's investment activities, and for other working capital purposes.

---

Accordingly, we do not have sufficient
funds for planned operations and we will be required to raise additional funds
for operations after that date.

These circumstances raise substantial
doubt about our ability to continue as a going concern, as described in the Note
1 of our June 30, 2010 unaudited financial statements. The financial statements
do not include any adjustments that might result from the outcome of that
uncertainty. The continuation of our business is dependent upon us raising
additional financial support. The issuance of additional equity securities by us
could result in a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

There are no assurances that we will be
able to obtain further funds required for our continued operations. We are
pursuing various financing alternatives to meet our immediate and long-term
financial requirements. There can be no assurance that additional financing will
be available to us when needed or, if available, that it can be obtained on
commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, we will be forced to scale down or perhaps even
cease the operation of our business.

Future Financings

As of June 30, 2010, we had cash of $39
and we estimate that we will require approximately $72,000 to fund our business
operations over the next twelve months. In addition to funding the Companys
general, administrative and corporate expenses the Company is obligated to
address its current obligations totaling $1,249,618. Accordingly, we do not have
sufficient funds for planned operations and we will be required to raise
additional funds for operations after that date. We anticipate continuing to
rely on equity sales of our common shares or shareholder loans in order to
continue to fund our business operations. Issuances of additional shares will
result in dilution to our existing stockholders. There is no assurance that we
will achieve any additional sales of our equity securities or arrange for debt
or other financing to fund our planned activities.

Off-balance sheet arrangements

As of the date of this Report, the
Company does not have any off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the company's financial
condition, change in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that are
material to investors. The term "off-balance sheet arrangement" generally means
any transaction, agreement, or other contractual arrangement to which an entity
unconsolidated with the Company is a party under which the Company has (i) any
obligation arising under a guarantee contract, derivative instrument or variable
interest; or (ii) a retained or contingent interest in assets transferred to
such entity or similar arrangement that serves as credit, liquidity or market
risk support for such assets.

|3. | Quantitative and Qualitative Disclosures About Market
      Risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The Company has no market risk sensitive
    instruments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|4. | Controls and Procedures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | As required by Rule 13(a)-15 under the Exchange Act, in
      connection with this quarterly report on Form 10-Q, under the direction of
      our Chief Executive Officer and Chief Financial Officer, we have evaluated
      our disclosure controls and procedures as of June 30, 2010, our disclosure
      controls and procedures were ineffective. As of the date of this filing,
      we are still in the process of remediating such material weaknesses in our
      internal controls and procedures. Additionally, we are currently inactive
      as we seek new business opportunities.

---

It should be noted that while our
management believes our disclosure controls and procedures provide a reasonable
level of assurance, they do not expect that our disclosure controls and
procedures or internal controls will prevent all error and all fraud. A control
system, no matter how well conceived or operated, can provide only reasonable,
not absolute, assurance that the objectives of the control system are met.
Further, the design of a control system must reflect the fact that there are
resource constraints, and the benefits of controls must be considered relative
to their costs. Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, within our company have been detected. These
inherent limitations include the realities that judgments in decision making can
be faulty, and that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
controls. The design of any system of internal control is based in part upon
certain assumptions about the likelihood of future events, and there can be no
assurance that any design will succeed in achieving its stated goals under all
potential future conditions. Over time, controls may become inadequate because
of changes in conditions, or the degree of compliance with the policies or
procedures may deteriorate. Because of the inherent limitations in a
cost-effective control system, misstatements due to error or fraud may occur and
not be detected.

There were no changes in our internal
control over financial reporting during the period ended June 30, 2010 that have
materially affected or are reasonably likely to materially affect, our internal
control over financial reporting.

---

Part IIOther Information

|1.       | Legal Proceedings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|-------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | None                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|1. **A** | Risk Factors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | Not applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|2.       | Unregistered Sales of Equity Securities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | Sales of Securities Without Registration Under the
      Securities Act of 1933                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | On August 10, 2003 the Company entered into a Convertible
      Loan Facility Agreement with Star Leisure & Entertainment Inc. (Star Leisure), a company controlled
      by a Director and Officer of Strategic, whereby the Company would, from
      time to time, borrow operating funds from Star Leisure, at an interest
      rate of 10%, repayable on demand. The lender has the right to convert all
      or part of the principal sum into units at a conversion rate which is
      calculated at a discount to the average closing market price for ten days
      preceding a loan advance. Each unit consists of one common share of the
      Company and one non-transferable share purchase warrant, expiring 2 years
      from the conversion date, exercisable at the applicable conversion rate.
      On August 31, 2008 the Company entered into agreements to transfer
      previous advances and accrued interest to convertible loans under the
      Convertible Loan Facility Agreement. At June 30, 2010, the Star Leisure
      loan principal was $255,209. The loan principal is convertible into
      4,526,436 units at conversion price ranging from $0.05 to $0.12 as set at
      the time the principal was borrowed. Star Leisure has not converted any
      part of the principal sums advanced into units as of June 30, 2010. This
      transaction is with an offshore non-U.S. person; accordingly, these
      securities are exempt from registration pursuant to Regulation
S.
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | On May 5, 2006 the Company entered into a Convertible
      Loan Facility Agreement with CMB Investments Ltd. (CMB), a company controlled by a Director of Strategic,
      whereby the Company would, from time to time, borrow operating funds from
      CMB, at an interest rate of 10%, repayable on demand. The lender has the
      right to convert all or part of the principal sum into units at a
      conversion rate which is calculated at a discount to the average closing
      market price for ten days preceding a loan advance. Each unit consists of
      one common share of the Company and one share purchase warrant, expiring 2
      years from the conversion date, exercisable at the applicable conversion
      rate. At June 30, 2010, the CMB loan principal was $163,766. The loan
      principal is convertible into 2,320,858 units. Conversion of this loan and
      associated warrants to equity will be at a price ranging from $0.05 to
      $0.23. CMB has not converted any part of the principal sums advanced into
      units as of June 30, 2010. This transaction is with an offshore non-U.S.
      person; accordingly, these securities are exempt from registration
      pursuant to Regulation S.                                                                                                                                                                                                                                                                      
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | On April 23, 2007 the Company completed a private
      placement of 200,000 common shares at $0.25 per share for total proceeds
      of $50,000. This transaction is with an offshore non-U.S. person;
      accordingly, these securities are exempt from registration pursuant to
      Regulation S.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | In May 2007 the Company entered into two Consulting
      Agreements for financial consulting services for a period of 12 months.
      Pursuant to these agreements, the Company issued 700,000 common shares at
      a deemed price of $0.20 per share, for a total deemed consideration of
      $140,000. These transactions are with offshore non-U.S. persons;
      accordingly, these securities are exempt from registration pursuant to
      Regulation S, however they are restricted under Rule 144.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | In June 2008 the Company entered into two Consulting
      Agreements for consulting services for a period of 12 months. Pursuant to
      these agreements, the Company issued 750,000 common shares with a market
      price of $0.07 per share, for a total deemed consideration of $52,000.
      These transactions are with offshore non-U.S. persons; accordingly, these
      securities are exempt from registration pursuant to Regulation S, however
      they are restricted under Rule 144.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | Purchase of Equity Securities by the Issuer and
      Affiliated Purchasers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|         | We did not purchase any of our shares of common stock or
      other securities during the period ended June 30,
2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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|3. | Defaults Upon Senior
Securities
|-- | -------------------------------

 None

|4. | Submission of Matters to a Vote of Security
      Holders
|-- | ---------------------------------------------------------

 None

|5. | Other Information
|-- | -----------------

 None

|6. | Exhibits
|-- | --------

|Table of Exhibit |                                               |             
|---------------- | --------------------------------------------- | ------------
|Items            | Description                                   | Exhibit     
|                 |                                               |             
|601-3(i)         | Articles of Incorporation                     | Note 1      
|601-(3)(ii)      | Bylaws                                        | Note 1      
|601-(3)(iii)     | Certificate of Amendment                      | Note 1      
|601-(10)         | Stock Award Plan                              | Note 2      
|601-(31)         | Rule 13a-14(a)/15d-14(a)
      Certifications | Exhibit 31.1
|601-(31)         | Rule 13a-14(a)/15d-14(a) Certifications       | Exhibit 31.2
|601-(32)         | Section 1350 Certifications                   | Exhibit 32.1
|601-(32)         | Section 1350 Certifications                   | Exhibit 32.2
|                 |                                               |             

Note 1:
    Incorporated by reference to Form 10-KSB Annual
      Report for the year ending December 31, 2001Note 2:
    Incorporated by reference to Form 10-KSB Annual
      Report for the year ending December 31, 2002


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

|      |                       |  | Strategic Internet Investments,
      Incorporated
|----- | --------------------- |  | --------------------------------------------------
|      |                       |  |                                                   
|      |                       |  |                                                   
|      |                       |  |                                                   
|Date: | August
      16, 2010 |  | /s/
      Abbas Salih                             
|      |                       |  | Abbas Salih, CEO, CFO, Director                   

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