Datacentrex, Inc.: Form 10-K for the period ended Dec 31, 2025

Company Overview

Datacentrex, Inc. (formerly, Thumzup Media Corporation), a Nevada corporation (“Datacentrex,” the “Company,” “we,” “us,” or “our”) is a digital infrastructure and capital deployment company that owns and operates Scrypt compute assets and evaluates strategic transactions across asset-backed operating businesses. Our current operating platform is centered on owned and operated Scrypt-based proof-of-work (“PoW”) compute deployed through third-party colocation facilities. We monetize this compute primarily through hashrate marketplace mechanisms and manage a treasury of digital assets and cash in a manner intended to preserve capital and support opportunistic, accretive deployment.

Our Scrypt compute operations utilize specialized application-specific integrated circuit (“ASIC”) hardware to contribute hashrate to the Litecoin blockchain. Through merged-mining architecture, that same hashrate can simultaneously secure and validate additional Scrypt-based networks, including Dogecoin and other auxiliary Scrypt chains, without incremental energy consumption. This merged-mining attribute allows a single deployment of compute and power to produce economic exposure to multiple networks, subject to protocol rules and monetization mechanics.

On August 18, 2025, Datacentrex, entered into an Agreement and Plan of Merger with TZUP Merger Sub, Inc., a wholly-owned subsidiary of the Company, and Dogehash Technologies, Inc. (“Doge”), a Nevada corporation, pursuant to which the Company agreed to acquire Doge (the “Merger”). As of the consummation of the Merger between Thumzup Media Corporation (“Thumzup”) and Doge, the Company operates more than 3,100 Scrypt ASIC miners deployed across multiple geographically diversified colocation facilities.

Our results are primarily driven by (i) realized revenue rate per unit of hashrate deployed, (ii) power cost and curtailment exposure at the facility level, (iii) uptime and operational execution, (iv) availability and replacement cycle dynamics for Scrypt ASIC supply, and (v) treasury and capital allocation decisions, including decisions regarding holding, converting, or deploying digital assets and cash.

We are not a protocol developer. We do not control any blockchain network and do not generate revenues from maintaining or updating any open-source network protocol. Our results depend on our ability to procure and operate compute infrastructure economically and to monetize that compute in a manner that produces attractive risk-adjusted returns.

The Company’s operations are principally operated remotely at various data centers throughout the United States. The Company’s principal address is 470 W 200 N STE 18, Salt Lake City, UT 84103 and its telephone number is (800) 403-6150. The Company’s website address is www.datacentrex.com (http://www.datacentrex.com). The information provided on the Company’s website or connected thereto does not constitute part of, and is not incorporated by reference into, this Annual Report on Form 10-K.

Corporate Information and History

Our current business was formed through a series of transactions involving an asset acquisition, a public-company business combination, and a subsequent name change.

Thumzup Media Corporation (“Thumzup”) was incorporated in the State of Nevada on October 27, 2020. Thumzup was originally organized as a technology company focused on social media advertising and content monetization.

In July 2025, Doge acquired certain digital asset mining assets and related business operations from US Data & Energy, LLC (“USDE”) pursuant to an asset purchase transaction. These assets included ASIC miners and related equipment that were located at colocation facilities, warehoused, on order, or in transit for digital asset compute activities.

Thereafter, Doge was acquired by Thumzup in the Merger. Following completion of the Merger, the combined company changed its name to Datacentrex, Inc.

The Company’s operations are principally operated remotely at various data centers throughout the United States. The Company’s principal address is 470 W 200 N STE 18, Salt Lake City, UT 84103 and its telephone number is (800) 403-6150. The Company’s website address is www.datacentrex.com (http://www.datacentrex.com). The information provided on the Company’s website or connected thereto does not constitute part of, and is not incorporated by reference into, this Annual Report.

Unless the context requires otherwise, references in this section to our “operations,” “fleet,” or “compute platform” refer to the business and assets as operated by Datacentrex following the Merger.

Recent Developments

Doge Acquisition

On August 18, 2025, Datacentrex entered into an Agreement and Plan of Merger (the “Merger Agreement”) with TZUP Merger Sub, Inc., a wholly-owned subsidiary of Datacentrex (“Merger Sub”), and Dogehash Technologies, Inc. (“Doge”), a Nevada corporation, pursuant to which the Company agreed to acquire Doge.

On December 15, 2025, Merger Sub and Doge filed Articles of Merger with the Nevada Secretary of State pursuant to which, effective as of December 15, 2025, Merger Sub merged with and into Doge with Doge surviving as a wholly-owned subsidiary of the Company. Pursuant to the terms of the Merger Agreement, the Company issued an aggregate of 13,835,188 shares of the Company’s common stock, and 16,239.812 shares of Series D Convertible Preferred convertible into an aggregate of 16,239,812 shares of common stock to the shareholders of Doge in exchange for 100% of the outstanding capital stock of Doge.

Name Change

On December 15, 2025, the Company filed a Certificate of Amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada to change its name to Datacentrex, Inc. from Thumzup Media Corporation.

Public Offering

On March 26, 2026, we entered into a placement agency with Dominari Securities LLC, pursuant to which we sold directly to investors, in a best efforts offering, an aggregate of (i) 4,510,000 shares of common stock at $2.00 per share and (ii) pre-funded warrants to purchase up to an aggregate of 5,575,000 shares of common stock at $1.99 per pre-funded warrant. The securities were offered and sold by us pursuant to our effective registration statement on Form S-3 (File No. 333-286951). The closing of the offering occurred on March 31, 2026 and the gross proceeds from the offering were approximately $20.2 million, before deducting placement agent fees and expenses and estimated offering expenses payable by us. We intend to use the net proceeds received from the offering for working capital and general corporate purposes.

Our Business Model

We generate revenues by deploying owned Scrypt ASIC hardware to produce PoW hashrate and monetizing that hashrate through market-based channels. Our model can be summarized as:

• acquiring and operating owned Scrypt ASIC hardware;
• securing competitive power and physical hosting through colocation agreements;
• maintaining operational discipline through monitoring, maintenance, configuration management, and rapid response to downtime;
• monetizing hashrate primarily through a hashrate marketplace model (typically settling in Bitcoin); and
• managing treasury assets and cash with the objective of preserving capital while pursuing yield-enhancing and accretive opportunities consistent with our risk management approach.

Our monetization approach is intended to reduce reliance on any single protocol-native payout stream and improve realized economics by seeking transparent market pricing for compute and minimizing certain fees and conversion costs that can arise under traditional pool-based mining models.

Scrypt Proof-of-Work Compute and Merged Mining

Scrypt is a PoW hashing algorithm used by Litecoin and certain other digital asset networks, including Dogecoin. Scrypt ASIC miners are not interchangeable with SHA-256 ASIC miners used for Bitcoin. As a result, Scrypt compute is a distinct compute market with different hardware supply dynamics, competition levels, and revenue drivers.

We primarily contribute hashrate to the Litecoin blockchain. Litecoin supports merged mining, which allows the same computational work used to validate Litecoin blocks to simultaneously validate additional Scrypt-based networks. In practical terms, merged mining can allow a miner to generate rewards attributable to multiple networks from the same energy input, subject to the rules of the applicable protocols and the payout mechanisms used by the monetization channel.

Merged mining does not create unlimited or guaranteed incremental economics. Rewards attributable to auxiliary networks may vary based on protocol parameters, network conditions, and monetization mechanics. The Company remains exposed to market and network dynamics affecting Scrypt compute generally, including changes in total network hashrate, mining difficulty, protocol reward structures, and transaction fee markets.

Hashrate Monetization and Marketplace Model

Traditional PoW miners often monetize compute by connecting directly to a mining pool that aggregates hashrate from many miners and distributes protocol-native rewards net of pool fees. Under that approach, miners may then convert protocol-native rewards into other assets (including fiat currencies) to fund operations or pursue a desired treasury exposure, which can introduce conversion costs, liquidity constraints, execution slippage, and incremental operational complexity.

We primarily monetize our Scrypt compute through a hashrate marketplace model. In a hashrate marketplace, compute providers offer available hashrate to third-party buyers seeking computational capacity for PoW validation. Buyers pay a market-determined rate for hashrate, and the marketplace coordinates matching, settlement, and operational routing. Under this model, we generally receive compensation based on prevailing market demand for Scrypt hashrate, with settlement typically denominated in Bitcoin.

Management believes that monetizing hashrate through a marketplace can, depending on market conditions, (i) improve realized pay rates for hashrate relative to certain pool-based alternatives, (ii) reduce or eliminate certain pool participation fees and payout variance associated with protocol-native distributions, and (iii) reduce the need for post-mining conversion transactions that may otherwise create incremental costs. Marketplace monetization also introduces reliance on marketplace operators and exposes the Company to operational and counterparty risks associated with those platforms.

We may utilize mining pools opportunistically or for redundancy; however, we view marketplace monetization as a core component of our current strategy. Our realized revenue under either model remains sensitive to market demand for compute, network-level dynamics, and overall digital asset market conditions.

Revenue Recognition and Customers

The Company generates revenue through the monetization of Scrypt compute via hashrate marketplaces. Under this model, the Company offers available hashrate to third-party buyers seeking computational capacity for PoW validation. Buyers pay a market-determined rate for hashrate based on prevailing supply and demand.

Revenue is recognized when payment for delivered hashrate is received and the corresponding digital assets are transferred to a wallet controlled by the Company. Amounts earned but not yet settled or received are not recognized as revenue. Settlement under the hashrate marketplace model is typically denominated in Bitcoin.

The buyers of the Company’s hashrate are not concentrated and may include a broad range of market participants. Buyers may include miners, infrastructure operators, trading firms, and arbitrage participants who purchase hashrate and redirect it to alternative pools or strategies to capture yield, pricing inefficiencies, or other economic opportunities. The Company does not typically enter into long-term bilateral contracts with hashrate buyers and generally does not have direct visibility into buyers’ downstream use of purchased hashrate.

Because hashrate is sold through marketplace mechanisms, the Company does not rely on a limited number of end customers and is not subject to traditional customer concentration risk; however, the Company remains dependent on the continued operation and liquidity of the marketplaces through which it monetizes hashrate.

Key Operating Inputs

Digital asset market conditions. Our results are influenced by price, volatility, and liquidity in digital asset markets, including the assets associated with Scrypt networks and the settlement asset we receive through monetization channels. Adverse movements may reduce revenue and operating margins and impair liquidity.

Network difficulty and hashrate. PoW networks dynamically adjust mining difficulty based on total network hashrate. Increased network hashrate typically increases difficulty, which reduces expected rewards per unit of hashrate deployed and can pressure margins if power costs or monetization rates do not improve. Conversely, declines in network hashrate can reduce difficulty and improve expected economics for remaining miners.

Power costs and curtailment. Electricity is a primary input cost. Power rates, capacity charges, curtailment obligations, transmission constraints, and other ancillary costs can materially affect profitability. We may be required to curtail load or may voluntarily curtail load when economically advantageous or contractually required.

Uptime and operational execution. Because revenue depends on continuous operation of compute assets, uptime is a critical driver of realized results. Equipment failures, facility outages, maintenance, networking issues, and configuration errors can reduce uptime and revenue.

Hardware supply and replacement cycles. Scrypt ASIC supply is subject to vendor production schedules, logistics, and market availability. As competition evolves, miners may need to deploy newer hardware, replace components, or optimize existing fleets to remain competitive.

Counterparty performance. Our business depends on the performance of hosting providers, marketplace operators, custodians, and trading venues. Counterparty failures, cybersecurity incidents, or operational disruptions could materially affect results.

Cost Structure and Operating Leverage

The Company’s cost structure consists primarily of power costs, hosting-related expenses, and depreciation of capitalized mining equipment.

Power Costs

Electricity is the primary operating cost of the Company’s compute operations. Power consumption is variable based on the number of machines operating at any given time. However, under the Company’s existing colocation arrangements, the price of electricity is fixed pursuant to contractual agreements, and uptime and power delivery obligations are contractually defined.

If a hosting or colocation provider fails to deliver power in accordance with the terms of the applicable agreement, the Company may be entitled to monetary penalties or, in certain circumstances, to terminate the agreement without recourse to the host. As a result, while power usage fluctuates with operational decisions, power pricing and availability are substantially governed by contract.

Hosting and Operating Costs

Hosting-related costs include facility services, power delivery infrastructure, networking, and site-level operations provided by colocation partners. These costs may include both fixed and variable components depending on contractual terms and facility configuration.

Capitalized Hardware

Mining equipment is capitalized and depreciated over its estimated useful life. Hardware costs are not expensed as incurred, and operating margins are therefore sensitive to both depreciation expense and the economic productivity of deployed equipment.

Operating Leverage and Scale

Operating scale does not inherently improve margins under a pure hosting model. Meaningful margin expansion is primarily achievable through upstream integration into power ownership or power-adjacent infrastructure. If the Company were to acquire or control power generation, interconnection, or other upstream assets, margins could expand significantly due to reduced energy costs and improved control over the cost structure. There can be no assurance that such opportunities will be pursued or achieved.

Mining Equipment and Hosting Arrangements

Mining Equipment

Datacentrex owns a fleet of specialized Scrypt ASIC miners used to generate PoW hashrate. Since inception of the operating platform, the Company has invested in excess of $29 million in mining equipment and related infrastructure.

As of the consummation of the Merger, the Company operated more than 3,100 Scrypt ASIC miners, which are deployed across multiple colocation facilities. The Company may hold certain equipment in inventory, in transit, or in staging for deployment, and may acquire additional miners or components depending on expansion plans, equipment availability, and capital allocation priorities.

The economic performance of the Company’s mining equipment depends on a number of factors, including hardware reliability, uptime, network difficulty, power costs, and monetization rates. Over time, competitive dynamics may require replacement, refurbishment, or redeployment of equipment to maintain attractive operating economics.

Equipment Lifespan and Replacement Cycles

Scrypt ASIC miners have finite useful lives and are subject to technological obsolescence over time. However, the lifecycle dynamics of Scrypt mining equipment differ from those of SHA-256 mining equipment used in Bitcoin mining.

The Scrypt ASIC market is served by a limited number of manufacturers, and innovation cycles have historically occurred at a slower pace relative to Bitcoin mining hardware. As a result, Scrypt miners may retain economic usefulness for longer periods, and new hardware generations may not render prior generations obsolete as rapidly as in other PoW markets.

Management believes these dynamics can support longer economic lifespans and residual value for Scrypt mining equipment relative to certain other mining categories. Nonetheless, future technological developments, changes in network economics, or shifts in competitive dynamics could reduce the useful life or value of existing equipment.

Hosting and Colocation Arrangements

Datacentrex deploys its mining equipment primarily through third-party colocation and hosting arrangements. Under these arrangements, hosting providers supply physical space, electrical infrastructure, power delivery, and certain site services necessary to operate energy-intensive compute workloads. The Company retains ownership of its mining equipment and remains responsible for configuration, monitoring, maintenance coordination, and operational management, subject to the terms of applicable hosting agreements.

The Company currently operates under three colocation arrangements that provide access to electric power sourced from the Electric Reliability Council of Texas (ERCOT) grid, the Midcontinent Independent System Operator (MISO) grid, and the Georgia Power grid, respectively. These arrangements allow Datacentrex to diversify geographic exposure, grid risk, and operational dependencies while supporting deployment of its existing fleet. Hosting arrangements expose the Company to counterparty risk, including the risk that a hosting provider fails to perform its obligations, experiences operational disruptions, or becomes financially distressed. Hosting agreements may also include provisions related to curtailment, maintenance windows, capacity constraints, or other operational limitations that can affect uptime and revenue.

Management believes that deploying equipment across multiple facilities and grid regions reduces reliance on any single site or power market. However, diversification does not eliminate the risk of correlated events, including regional grid disruptions, extreme weather events, regulatory actions, or market-wide curtailment programs. The Company’s ability to expand operations depends on the availability of additional hosting capacity, power, and interconnection on acceptable terms, as well as access to capital and equipment supply.

Treasury, Liquidity, and Custody

We manage digital assets and cash as part of a dynamic treasury and capital allocation strategy intended to preserve capital, maintain liquidity, and enhance long-term value creation.

Under our hashrate marketplace monetization model, settlement is typically received in Bitcoin. Management has historically evaluated retaining Bitcoin-denominated proceeds as a treasury asset rather than immediately converting to fiat currency and expects that future treasury concentration may favor Bitcoin over time. From time to time, we may allocate a portion of Dogecoin exposure to pilot-stage, protocol-native yield opportunities within the Dogecoin ecosystem, including limited participation in Layer-2 networks. These activities remain exploratory and are not governed by a formal treasury policy adopted by our board of directors. We may modify, expand, suspend, or discontinue such pilot activities based on performance and risk assessment.

We utilize institutional custodians and trading platforms for custody and execution, including Anchorage Digital and Coinbase Prime, and are subject to risks associated with third-party custodians and trading venues, including cybersecurity risk, operational risk, legal and regulatory risk, and counterparty risk.

Infrastructure and Power Strategy

Power and physical infrastructure are foundational to our operating platform. Our current compute operations are deployed primarily through third-party colocation sites that provide access to power and the environment required to run energy-intensive compute.

Management evaluates opportunities to expand and, where attractive, vertically integrate upstream through acquisitions or developments involving powered land, interconnection capacity, electrical infrastructure, or operating data-center assets. Such opportunities may improve cost control and strategic flexibility but can require significant capital, permitting and regulatory execution, and operational integration.

We do not intend to limit our long-term opportunity set to cryptocurrency-related compute. Management believes our experience operating energy-intensive compute positions the Company to evaluate other compute-enabled or infrastructure-backed opportunities.

Competitive Strengths and Strategic Position

Management believes Datacentrex is competitively positioned within the Scrypt compute market and broader digital infrastructure landscape due to a combination of operational execution, capital availability, and strategic relationships.

Management believes the Scrypt ASIC hardware market is currently highly concentrated, with a limited number of manufacturers capable of producing Scrypt mining equipment at scale. As a result, access to next-generation hardware may be constrained and may serve as a significant barrier to entry for new or under-capitalized participants. Furthermore, Datacentrex has developed long-standing commercial relationships with leading manufacturers and suppliers of Scrypt ASIC hardware. These relationships have historically enabled the Company to access new generations of equipment earlier than many market participants, secure meaningful allocation during periods of constrained supply, and deploy hardware at scale with greater predictability. Management believes this sourcing capability represents a strategic moat, as early access to next-generation equipment can materially affect operating economics, competitiveness, and capital efficiency in PoW compute markets.

Notwithstanding the foregoing, access to hardware alone is insufficient without the capital, infrastructure, and operational readiness to deploy it effectively. Datacentrex maintains the balance-sheet capacity, hosting relationships, and internal operational systems necessary to deploy new equipment rapidly once sourced. The Company’s ability to fund equipment purchases, coordinate logistics, and integrate new hardware into existing operations reduces deployment friction and shortens the time between capital commitment and revenue generation.

In addition to the foregoing, Datacentrex operates a scaled fleet of Scrypt ASIC miners across multiple geographically diversified facilities. Management believes that operating at scale improves negotiating leverage with vendors and hosting providers, supports operational learning curves, and enables the Company to absorb variability in network conditions, power markets, and equipment performance more effectively than smaller operators.

Datacentrex’s compute platform, capital structure, and operational expertise provide strategic flexibility. Management believes the Company is positioned not only to scale Scrypt compute operations but also to evaluate acquisitions, joint ventures, or infrastructure investments that may further enhance access to power, equipment, or operating capabilities.

Competition

We compete across multiple markets, including specialized digital compute, digital asset mining, data-center infrastructure, and transaction-driven capital deployment.

Scrypt compute operators. The Scrypt compute sector is less institutionally saturated than Bitcoin mining and is characterized by a limited number of scaled operators. There are few publicly traded companies operating Scrypt compute as a primary line of business. Furthermore, from time to time, other entities have and may announce strategic transactions intended to establish Scrypt-focused platforms.

Broader cryptocurrency miners and potential entrants. We compete indirectly with large-scale cryptocurrency miners and infrastructure operators that could allocate capital, management attention, or facility capacity into Scrypt compute or adjacent digital infrastructure. Even where their existing hardware is not interchangeable with Scrypt ASICs, larger miners may have advantages in access to capital, power procurement, facility development, operating scale, and vendor relationships. Examples of companies that may compete with us for capital, power, hosting capacity, hardware supply, and acquisition opportunities include (among others): Argo Blockchain; Bit Digital; Bitfarms; CleanSpark; Cipher Mining; Core Scientific; Hive; Hut 8; Iris Energy; Marathon Digital; Northern Data; Riot Platforms; Digi Power X; and TeraWulf.

Digital asset treasury and yield-oriented companies. Certain companies focus on digital asset treasury strategies or ecosystem-based yield generation, including strategies focused on Dogecoin. These companies generally do not operate energy-intensive compute fleets at scale. While we do not consider these companies direct competitors with respect to our compute operations, they may compete indirectly for investor capital or thematic exposure.

Data-center infrastructure owners and operators. As we evaluate opportunities to acquire or develop infrastructure assets upstream, we compete with traditional data-center developers, owners, and operators. Competition in this segment is driven by access to power and interconnection, speed of deployment, permitting and regulatory execution, engineering capabilities, and cost of capital.

Capital markets and acquisition competition. To the extent we pursue mergers, acquisitions, or strategic investments, we compete with private equity funds, infrastructure funds, energy developers, and strategic acquirers for attractive assets.

Strategy and Growth

Datacentrex is not positioned solely as a cryptocurrency mining company. Management views Scrypt compute as an initial operating platform that can generate cash flow and operational capabilities that may be leveraged across a broader strategic mandate.

We intend to maintain flexibility to pursue mergers, acquisitions, asset purchases, joint ventures, and strategic investments across digital infrastructure, compute-enabled services, energy-adjacent infrastructure, and other asset-backed operating businesses. We may evaluate opportunities both within and outside the digital asset ecosystem. Management may adjust strategic focus over time in response to market conditions, regulatory developments, capital availability, and risk-adjusted return opportunities.

Strategic Scope and Capital Allocation Boundaries

The Company’s strategy is designed to preserve flexibility while maintaining discipline in capital allocation. Although Datacentrex currently operates a Scrypt-based compute platform, management does not view the Company as permanently constrained to any single protocol, asset class, or operating model. Strategic decisions, including material expansions, acquisitions, divestitures, or entry into new lines of business, are subject to oversight by the Company’s board of directors. While management evaluates a broad range of potential opportunities, the Company does not intend to deploy capital indiscriminately or to pursue speculative investments unrelated to asset-backed operating businesses. Notwithstanding the foregoing, there can be no assurance that identified opportunities will be consummated or that any strategic initiative will be successful.

Government Regulation

Cryptocurrency

Our business is subject to evolving laws, regulations, and regulatory scrutiny related to digital assets, data-center and energy infrastructure, environmental and power usage considerations, and public company disclosure and compliance obligations. Regulatory actions, new legislation, changes in enforcement priorities, and the interpretation of existing laws may impact our ability to operate, custody, trade, hold, or deploy digital assets and may affect counterparties we rely upon.

Based on recent guidance from the SEC, we do not believe that our Scrypt-based PoW activities are subject to registration under the Securities Act or that the primary crypto assets that we earn through our activities or otherwise acquire are “securities” within the meaning of the Securities Act. The tests for determining whether a particular digital asset is a “security” and whether a particular transaction involving digital assets requires registration under the Securities Act, however, are fact-intensive, complex, and may be difficult to apply. If it is determined in the future that one or more digital assets in which we transact or that we hold in our treasury is a security, or that the types of transactions we conduct or may conduct in the future require registration with the SEC, it could have a material adverse effect on our business and operations.

Our operations may also be affected by utility regulation, interconnection and grid constraints, demand response and curtailment programs, environmental regulation, and permitting requirements applicable to energy-intensive operations.

Intellectual Property

Datacentrex does not rely on patents or licensed proprietary protocols to conduct its operations. However, the Company has developed and maintains proprietary internal software systems that are integral to the operation, monitoring, and management of its compute infrastructure and related assets.

These internal systems are designed to support real-time and near-real-time monitoring of site-level and fleet-level operations, including, among other things:

• monitoring miner status and uptime across facilities;
• identifying non-functioning or underperforming miners;
• managing pool and marketplace connectivity and routing;
• tracking hashrate output and revenue throughput;
• monitoring power usage and site-level electrical performance; and
• maintaining inventory tracking for deployed, staged, and inactive equipment.

Management believes these internally developed systems improve operational responsiveness, reduce downtime, support efficient troubleshooting, and enhance visibility into fleet performance and asset utilization. While such software does not eliminate operational risk, it is intended to support disciplined execution at scale.

In addition, the Company relies on a combination of internally developed tools and third-party software and services for monitoring, fleet management, cybersecurity, data aggregation, and operational administration. Datacentrex takes steps intended to protect its internally developed software and data through access controls and security practices, although it does not hold registered intellectual property rights in such systems.

Employees

As of April 13, 2026, we had two full-time employees, as well as nine investor relations, accounting, legal and operations independent contractors. We are not a party to any collective bargaining agreements. We believe that we maintain good relations with our employees.

Available Information

Our website address is www.datacentrex.com (http://www.datacentrex.com). The contents of, or information accessible through, our website are not part of this Annual Report, and our website address is included in this document as an inactive textual reference only. We make our filings with the U.S. Securities and Exchange Commission (“SEC” or “Commission”), including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports, available free of charge on our website as soon as reasonably practicable after we file such reports with, or furnish such reports to, the SEC. The public may read and copy the materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an Internet site that contains reports, proxy and information statements and other information. The address of the SEC’s website is www.sec.gov (http://www.sec.gov). The information contained in the SEC’s website is not intended to be a part of this Annual Report.

An investment in our common stock involves a high degree of risk. You should carefully consider the following risk factors and the other information in this Annual Report before investing in our common stock. Our business and results of operations could be seriously harmed by any of the following risks. The risks set out below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. If any of the following events occur, our business, financial condition and results of operations could be materially adversely affected. In such case, the value and trading price of our common stock could decline, and you may lose all or part of your investment.

Risks Related to our Business

We are an early-stage company with limited operating history.

We are an early-stage company currently and have a limited operating history. We have not maintained consistent profitability from period to period, and no assurances can be made that we will achieve consistent profitability in the near future, if ever. Accordingly, you should consider our business prospects in light of the costs, uncertainties, delays, and difficulties frequently encountered by companies in the early stages of development. Potential investors should carefully consider the risks and uncertainties that a company with a limited operating history will face. In particular, potential investors should consider that we may be unable to:

• successfully implement or execute our business plan, or demonstrate that our business plan is sound;
• adjust to changing conditions or keep pace with increased demand;
• attract and retain an experienced management team; or
• raise sufficient funds to effectuate our business plan.

We have a short operating history in the cryptocurrency mining space, and our new business is subject to a number of significant risks and uncertainties which affect its future viability.

As of December 31, 2025, Doge had invested approximately $29 million towards the development of its new cryptocurrency mining business. Doge entered into agreements and arrangements for equipment and services but has only recently commenced cryptocurrency mining operations. Among the risks and uncertainties applicable to the Company and its operations are:

• In July of 2025, Doge acquired approximately 3,100 application-specific integrated circuit computer miners from USDE;
• On September 24, 2025, prior to the acquisition, we loaned $2.5 million at a rate of 8% per annum to Doge, which was anticipated to support the addition of more than 500 new ASIC miners;
• We will rely upon a third-party to conduct most of our mining operations and will have very limited control over our operations;
• There are a limited number of available miners or cryptocurrency computers and the demand from competitors is fierce;
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• Because of supply chain disruptions including those relating to computer chips, we could encounter delivery delays or other difficulties with the purchase, installation and operation of our mining equipment at our facilities, which would adversely affect our ability to generate material revenue from operations;
• There are a growing number of well capitalized cryptocurrency mining companies, which competitors have significant capital resources, a large supply of miners, and management with significant experience in cryptocurrency mining;
• Bans from governments such as China, together with pending legislation in Congress and other regulatory initiatives threaten the ability to use cryptocurrencies as a medium of exchange;
• We may not be able to liquidate our holdings of cryptocurrencies at its desired prices if a material decline in market prices occurs and this could negatively impact our future financial condition;
• We have not planned to hedge the conversion of any of our sales of cryptocurrencies; and
• Historical performance of cryptocurrencies is not indicative of their future price performance.

For all of these reasons, our cryptocurrency mining business may not be successful and you may lose all of your investment.

Failure of critical systems related to our offerings and/or infrastructure could have a material adverse effect on our business, financial condition, and results of operations.

The critical systems related to our offerings and infrastructure are subject to failure. Failure of any of our or our colocation hosts’ critical systems, including a breakdown in critical plant, equipment or services, routers, switches or other equipment, power supplies, or network connectivity, whether or not within our control, could result in service interruptions to us and/or damage to equipment, which could significantly disrupt business operations, harm our reputation, and reduce our revenue. The destruction or severe impairment of any of the facilities where our equipment is hosted could result in significant downtime.

Our or our colocation hosts’ infrastructure and offerings are subject to temporary or permanent interruption by factors that include but are not limited to:

• power loss or plant downtimes;
• equipment failure;
• human error and accidents;
• theft, sabotage, and vandalism, including security breaches of infrastructure;
• failure by us or our suppliers to provide adequate service or maintain equipment and buildings;
• network connectivity downtime and fiber cuts;
• service interruptions resulting from server relocation;
• security breaches of infrastructure;
• improper or inadequate building maintenance;
• physical, electronic, and cybersecurity breaches;
• animal incursions;
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• fire, earthquake, hurricane, tornado, flood, and other natural disasters as well as exposure to extreme temperatures and water damage;
• extreme temperatures;
• water damage;
• public health crises, such as pandemics and epidemics; and
• military conflict, terrorism or other geopolitical events.

The occurrence of any of these events may have a material adverse effect on our business, financial condition, and results of operations. Moreover, service interruptions and equipment failures may expose us to potential legal liability.

Our operations are concentrated across a limited number of third-party colocation facilities, and an outage, service degradation, or operational disruption at any one facility could materially reduce our hashrate and revenue. Because our mining equipment is deployed in third-party environments, our ability to prevent, detect, and remediate certain events may be constrained by the policies, procedures, staffing, maintenance practices, security posture, and incident-response timelines of our colocation hosts and their upstream providers. In addition, relocating or redeploying mining equipment at scale can be time-consuming and costly due to logistical constraints, limited near-term capacity in comparable facilities, permitting or interconnection lead times applicable to hosts, shipping delays, and the need to reconfigure infrastructure, all of which could extend downtime and increase costs. Any prolonged interruption, reduced availability, or inability to promptly transition to an alternative hosting solution could have a material adverse effect on our business, financial condition, and results of operations.

Our business may be heavily impacted by geopolitical, social, economic, and other events and circumstances in the United States, or elsewhere.

Our business may be heavily impacted by geopolitical, social, economic, and other events and circumstances in the United States, and elsewhere. These include natural disasters, health pandemics (like the COVID-19 pandemic), geopolitical tensions sanctions or other restrictive actions, interest rate fluctuations, inflationary issues and associated changes in monetary policy or potential economic recession, commodity prices, legislative and regulatory changes, foreign currency fluctuations, international tariffs, fluctuations in capital markets, and broad trends in industry and finance. For example, equipment necessary for our operations and our offerings is manufactured in large part outside of the United States. There is currently significant uncertainty about the future relationship between the United States and other countries, including Canada, Mexico, China, the European Union, and others, with respect to trade policies, treaties, tariffs, and taxes. These events and circumstances are largely outside of our influence and control and, while the impact of such events or circumstances is not presently known, any of them could adversely affect our business, financial condition, and results of operations.

We face significant competition and may not be able to compete effectively against our current and future competitors.

The industries in which we operate are highly competitive and continuously evolving. We expect competition to further intensify as existing and new competitors introduce new offerings or enhance existing offerings and as the industries that we operate in continue to grow. As we continue to expand in our existing markets and enter new markets, we compete against an increasing number of companies operating both within North America and abroad, that may be more established or have greater financial and other resources and/or expertise.

Driven by the proliferation of energy-intensive applications such as cryptocurrency mining and high-performance computing (“HPC”), demand for energy capacity continues to outpace supply. For example, HPC workloads require high-density infrastructure with capacity demands multiples greater than legacy data centers can provide, while cryptocurrency mining remains a competitive market that requires operational efficiency and low-cost energy at scale. At the same time, supply chain disruptions and regulatory constraints have extended lead times for critical infrastructure, including graphics processing units (“GPUs”), application-specific integrated circuits (“ASICs”), generators, and transformers. Grid interconnection bottlenecks have further constrained access to power and digital infrastructure development. In this evolving landscape, we compete directly with cloud services providers, digital infrastructure developers, and large-scale cryptocurrency miners. The nature of competition varies across the layers of our platform:

• Power: We compete primarily for access to powered land and pre-powered colocation offerings; and
• Compete: We compete primarily for, specialized hardware, and Scrypt rewards.

We are subject to risks associated with our need for significant electrical power.

Our operations require significant amounts of electrical power and our business, financial condition, and results of operations may be impacted by the unavailability of power and price fluctuations in the power market. Market prices for power, capacity, and other ancillary services applicable to our colocation hosts are unpredictable and tend to fluctuate substantially. Unlike most other commodities, electric power can only be stored on a very limited basis and generally must be produced concurrently with its use. As a result, power prices are subject to significant volatility due to supply and demand imbalances, especially in the day-ahead and spot markets. Power availability and prices may also be materially impacted by other factors outside of our control, including:

• changes in generation capacity in our markets, including changes in the supply of power as a result of the development of new plants, expansion or reduction of existing plants, the continued operation of uneconomic power plants due to state subsidies, or additional or reduced transmission capacity;
• environmental regulations and legislation;
• electric supply disruptions, including plant outages and transmission disruptions;
• changes in power transmission infrastructure;
• fuel price volatility;
• fuel transportation capacity constraints or inefficiencies;
• development of new fuels, new technologies, and new forms of competition for the production of power;
• changes in law, including judicial decisions;
• weather conditions, including extreme weather conditions and seasonal fluctuations, including the effects of climate change;
• changes in commodity prices and the supply of commodities, including natural gas, coal, and oil;
• changes in the demand for power or in patterns of power usage;
• economic and political conditions;
• supply and demand for energy commodities;
• supply chain disruption of electrical components needed to transmit energy;
• availability of competitively priced alternative energy sources;
• ability to procure satisfactory levels of inventory; and
• changes in capacity prices and capacity markets.
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Such factors and the associated fluctuations in power availability and prices could affect wholesale power generation profitability and cost of power for our operations. We currently draw power from various power sources, which include the MISO grid, the ERCOT grid, and the Georgia Power grid. Power grids, including those we rely on, subject us to a variety of risks, including the breakdown or failure of equipment, accidents, security breaches, viruses or outages affecting information technology systems, labor disputes, obsolescence, delivery/transportation problems, disruptions of fuel supply, and performance below expected levels. These events may impact our ability to conduct our businesses efficiently and lead to increased costs, expenses, or losses.

Furthermore, there can be no assurance that power suppliers will service our colocation partner facilities or that, once they have entered into a power purchase agreement, such suppliers will continue to provide them with power for any period of time. These agreements may be terminated, or our colocation hosts may lose access to power under certain circumstances, and replacement power may not be available on commercially reasonable terms, or at all, particularly in light of limited power availability and grid constraints in many markets. The inability of our colocation hosts to secure or maintain adequate power arrangements could have a material adverse effect on our business, financial condition, and results of operations. Moreover, there may be significant competition for suitable locations with access to affordable power as we look to expand our operations.

We may be exposed to cybersecurity threats and breaches.

Threats to network and data security are increasingly diverse and sophisticated and security breaches, computer malware and computer hacking attacks have been an increasing concern. Despite our efforts and processes in place to prevent them, our computer servers and systems may be vulnerable to cybersecurity risks, including denial-of-service attacks, physical or electronic break-ins, employee theft or misuse and similar disruptions from unauthorized tampering. As techniques used to breach security change frequently and are generally not recognized until launched against a target, we may not be able to promptly detect that a cyber breach has occurred, implement security measures in a timely manner or, if and when implemented, we may not be able to determine the extent to which these measures could be circumvented. Recent developments in the cyber threat landscape include use of artificial intelligence (“AI”) and machine learning, as well as an increased number of cyber extortion and ransomware attacks, with the potential for higher ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology. Further, any adoption of AI by us or by third parties may pose new security challenges. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate the proprietary or sensitive information of us. We also may be required to expend significant capital and resources to protect against such threats or to alleviate problems caused by cyber breaches in our physical or virtual security systems. Any breaches that may occur in the future could expose us to increased risk of lawsuits, regulatory penalties, damage relating to loss of proprietary information, harm to our reputation, and increases in our security costs, which could have a material adverse effect on our business, financial condition, and results of operations.

Furthermore, we hold our cryptocurrency through a third-party qualified custodian rather than directly in self-custody. As a result, we are exposed to risks associated with the operations, security controls, systems, and financial condition of such custodian. A cybersecurity incident, operational failure, insolvency event, or other disruption affecting our custodian could result in delayed access to, partial loss of, or permanent loss of some or all of our cryptocurrency, which could have a material adverse effect on our business, financial condition, and results of operations. While the custodian maintains cold-storage and other security protocols designed to safeguard digital assets, no custodial system is immune to cyberattacks, internal failures, human error, or evolving threat vectors.

We are subject to many hazards and operational risks that can disrupt our business, some of which may not be insured or fully covered by insurance.

Our operations are subject to many hazards and operational risks inherent to our business, including:

• general business risks;
• the presence of construction or repair defects or other structural or building damage;
• operating large and often hazardous pieces of equipment;
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• any noncompliance with or liabilities under applicable environmental, health, or safety regulations, or requirements or building permit requirements;
• any damage resulting from natural or manmade disasters; and
• claims by employees, contractors, or the general public as a result of exposure to potentially dangerous environments at or near our operations.

The measures we take to protect against these risks may not be sufficient. The realization of any hazard or operational risk may result in business interruption, liability, or litigation. While we believe we maintain an amount of insurance protection that we consider adequate, but we cannot provide any assurance that our insurance will be sufficient or effective under all circumstances and against all hazards or liabilities to which we may be subject and, even if we do have insurance coverage for a particular circumstance, we may be subject to a large deductible and maximum cap. We carry liability, property, and other insurance policies to cover certain insurable risks to our company. We select the types of insurance, the limits, and the deductibles based on our specific risk profile, the cost of the insurance coverage versus its perceived benefit, and general industry standards. Our insurance policies contain certain industry standard exclusions for events such as war and nuclear reaction. A successful claim for which we are not fully insured could materially harm our business, financial condition, and results of operations. Further, due to rising insurance costs and changes in the insurance markets, we cannot provide any assurance that our insurance coverage will continue to be available at all or at rates or on terms similar to those presently available. Any losses not covered by insurance could have a material adverse effect on our business, financial condition, and results of operations.

If we incur debt in the future, it may adversely affect our economic and business condition.

We currently do not have material indebtedness. However, we may incur debt in the future to fund working capital, infrastructure investments, mining capacity, or strategic initiatives. Any future indebtedness could increase our vulnerability to adverse economic or business conditions, require significant cash flows for debt service, reduce funds available for operations and growth, and limit our flexibility in responding to competitive pressures. Debt agreements may include covenants that restrict our ability to incur additional indebtedness, dispose of assets, make investments, or engage in other transactions, and a breach of such covenants could permit lenders to accelerate maturity and exercise remedies.

Banks and financial institutions may be unwilling to provide, or may discontinue providing, accounts and other financial services to digital-asset-related businesses due to evolving regulatory expectations, perceived compliance risk, cost, or reputational concerns. Such “de-risking” has occurred within the digital asset industry and could be exacerbated by enforcement actions, insolvencies, or heightened regulatory scrutiny. If we were unable to maintain adequate banking relationships, we could experience increased costs, operational delays, reduced ability to pay vendors or employees, and constraints on capital raising and treasury operations, any of which could materially adversely affect our business, financial condition, and results of operations.

Most of our infrastructure is located on leased or collocated premises and the termination or higher renewal rate of our leases or colocation contracts could have a material adverse effect on our business, financial condition, and results of operations.

Because our mining equipment is hosted in third-party colocation facilities, we are exposed to additional risks if a colocation host or a critical vendor to that host experiences financial distress, insolvency, operational failure, or a business interruption event. If a host becomes subject to bankruptcy or similar proceedings, disputes could arise regarding access to our equipment, the prioritization of site operations, the continuation of services, or the enforcement of contractual rights, which could result in delayed access to, restricted use of, or inability to retrieve our equipment for an extended period. Even absent a bankruptcy, a host’s deterioration in financial condition could lead to deferred maintenance, staffing reductions, weakened security controls, reduced redundancy, or increased pricing and more restrictive contract terms. Any inability of a host to continue providing services at the required performance levels, or any delay or limitation on our access to hosted equipment, could have a material adverse effect on our business, financial condition, and results of operations.

Most of our infrastructure is located in collocated premises and there can be no assurance that our colocation host will remain in compliance with the colocation contract, that the colocation provider will continue to support our operations, and that the colocation contract will not be terminated despite negotiation for long term colocation periods and renewal provisions. When the initial terms of our existing colocation contracts expire, in some instances, we have the right to extend the terms of our contract for one or more renewal periods. Upon the end of our initial term or, if applicable, the renewal periods, we would have to renegotiate our lease terms with the applicable landlords. If renewal rates are less favorable than those we currently have, we may be required to increase revenues to offset such increase in lease payments. Failure to increase revenues to sufficiently offset these projected higher costs could adversely impact our operating income. We may also not be able to renew such leases at all. The termination of a lease could have a material adverse effect on our business, financial condition, and results of operations.

We may face the risk of Internet-related disruptions.

Our mining operations are dependent on the availability and reliability of Internet connectivity at third-party colocation facilities where our equipment is hosted. We do not own or operate these data centers and do not provide Internet services; instead, we rely on our colocation providers and their third-party network service providers to maintain adequate and uninterrupted connectivity. There can be no assurance that such providers will continue to supply sufficient Internet connectivity to the facilities where our equipment is located, or that connectivity, once established, will not be disrupted, degraded, or terminated. Any significant interruption, degradation, or loss of Internet connectivity at one or more colocation facilities could require us to curtail or suspend mining operations at the affected sites, which could materially and adversely affect our business, financial condition, and results of operations.

Our success depends on key personnel whose continued service is not guaranteed.

We depend on the efforts of our key personnel, including our senior leadership, many of whom have strong technology, finance, real estate, and/or power expertise and industry reputations. They are important to our success for many reasons, including that they attract investors and business and investment opportunities and assist us in negotiations with investors, lenders, and industry personnel. If we lost their services, our business and investment opportunities and our relationships with lenders and other capital markets participants, and industry personnel could suffer. As the number of our competitors increases, it becomes more likely that a competitor would attempt to hire certain of these individuals away from us. The loss of any of these key personnel would result in the loss of these and other benefits and could materially and adversely affect our business, financial condition, and results of operations.

We also depend on the talents and efforts of highly skilled technical individuals. Our success depends on our continuing ability to identify, hire, develop, motivate, and retain highly skilled technical personnel for all areas of our business. Competition in our industry for qualified technical employees is intense, and the availability of qualified technical personnel is not guaranteed. We cannot assure you that we will be able to attract or retain the personnel we require. If we are unable to identify, hire, develop, motivate, and retain such personnel, it could have a material adverse effect on our business, financial condition, and results of operations.

We do not directly obtain or hold material facility-level permits or approvals for our mining operations, as our equipment is hosted at third-party colocation facilities. Our colocation providers are responsible for obtaining, maintaining, and complying with permits, licenses, and approvals required to own and operate their data center facilities, including those related to zoning, construction, power usage, and environmental or energy regulation.

Although we generally rely on our colocation providers to satisfy applicable permitting and licensing requirements, our operations may be adversely affected if a colocation provider fails to obtain, maintain, or comply with required permits or approvals, or if such permits or approvals are revoked, modified, delayed, or become subject to more restrictive conditions as a result of legal, regulatory, or policy changes. Any such failure or disruption could result in the suspension, curtailment, or termination of operations at one or more facilities where our equipment is hosted, which could materially and adversely affect our business, financial condition, and results of operations.

Risks Related to Our Growth Prospects

New offerings or lines of business may subject us to additional risks.

We are a development stage company with a small management team and are subject to the strains of ongoing development and growth, which will place significant demands on our management and operational and financial infrastructure. To remain competitive with peers, we may need to modify aspects of our business model or we may implement new offerings or lines of business, from time to time. In developing and marketing new offerings or lines of business or expanding our current offerings or lines of business, we may invest significant time and resources. Initial timetables for the introduction and development of new offerings or lines of business may not be achieved and profitability targets may not prove feasible. External factors, such as compliance with regulations, competition, and shifting market preferences, may also impact the successful implementation of a new offering or line of business. In addition, our personnel and technology systems may fail to adapt to the changes or we may fail to effectively integrate new offerings or lines of business into our existing operations and we may lack experience in managing new offerings or lines of business. In addition, we may be unable to proceed with the operations as planned or compete effectively due to different competitive landscapes. Even if we expand our businesses into new jurisdictions or areas, the expansion may not yield intended profitable results. Furthermore, any new offering or line of business could have a significant impact on the effectiveness of our internal control system. Failure to successfully manage these risks in the development and implementation of new offerings or lines of business could have a material adverse effect on our business, financial condition, and results of operations. Furthermore, we cannot provide any assurance that we will successfully identify all emerging trends and growth opportunities in the markets in which we operate. As a result, we may not capture those opportunities. Such circumstances could have a material adverse effect on our business, financial condition, and results of operations.

We may not adequately respond to price fluctuations and rapidly changing technology.

Competitive conditions within the industries in which we operate require that we use sophisticated technology in the operation of our business. These industries are characterized by rapid technological changes, new product introductions, enhancements, and evolving industry standards. New technologies, techniques, or offerings could emerge that might offer better performance than the technologies we currently utilize, and we may have to manage transitions to these new technologies to remain competitive. We intend to continue to invest in hardware, equipment and technology at our facilities. We may not be successful, generally or relative to our competitors, in timely implementing new technology into our systems, or doing so in a cost-effective manner. During the course of implementing any such new technology into our operations, we may experience system interruptions and failures during such implementation. Furthermore, there can be no assurances that we will recognize, in a timely manner or at all, the benefits that we may expect as a result of our implementing new technology into our operations. As a result, our business, financial condition, and results of operations may suffer.

If we were to pursue ownership or development of data center facilities in the future, our construction of new data centers, data center expansions, or data center redevelopment could involve significant risks to our business.

In order to sustain our growth in certain of our existing and new markets, we may have to expand an existing data center, lease a new facility, or acquire suitable land, with or without structures, to build new data centers. Global supply chain and inflation issues have exacerbated many of these risks and created additional risks for our business. Some of the risks associated with the development, redevelopment and construction of data centers include:

• construction delays;
• power and power grid constraints;
• lack of availability and delays for data center and/or power equipment, including items such as generators and switchgear;
• unexpected budget changes;
• increased prices for and delays in obtaining building supplies, raw materials, and data center equipment;
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• labor availability, labor disputes, and work stoppages with contractors, subcontractors, and other third parties;
• unanticipated environmental issues and geological problems;
• delays related to permitting and approvals to open from public agencies and utility companies; and
• unexpected lack of power access;

We may experience rising construction costs as a result of increasing costs of labor and raw materials, supply chain and logistic challenges, and high demand. Furthermore, delays, difficulty finding replacement products, continued high inflation, and additional or unexpected disruptions to our supply chain could significantly affect the cost of our existing or anticipated projects. Site selection is also a critical factor in our expansion plans. There may not be suitable properties available in our markets with the necessary combination of high-power capacity and fiber connectivity, or selection may be limited. We expect that we will continue to experience limited availability of power and grid constraints in many markets as well as shortages of associated equipment because of the current high demands and finite nature of these resources. These shortages could result in site selection challenges, construction delays or increased costs.

If we do not accurately predict our facility requirements, it could have a material adverse effect on our business, financial condition, and results of operations.

We may acquire other businesses and/or assets or form strategic alliances or joint ventures that could negatively affect our operating results, dilute shareholder ownership, increase debt, or cause us to incur significant expenses.

We have previously engaged in strategic transactions and, as part of our growth strategy, in the future, we may pursue additional acquisitions of businesses and/or assets and/or enter into strategic alliances or joint ventures. However, we cannot offer any assurance that any such acquisition or partnership will be successful. We may not be able to identify suitable partners or acquisition candidates and may not be able to complete such transactions on favorable terms, if at all. If we complete any acquisitions, we may not be able to integrate these acquisitions successfully into our existing business. In addition, in the event that we acquire any existing businesses, we may assume unknown or contingent liabilities.

Any such acquisitions also could result in the issuance of stock, incurrence of debt, contingent liabilities, write-offs of intangible assets or goodwill, restructuring and other related expenses, or litigation, any of which could have a negative impact on our business, financial condition, and results of operations. Integration of an acquired company may also disrupt ongoing operations and carry substantial compliance burdens and costs, which may limit our ability to realize the anticipated benefits of such acquisitions, and which may require management resources that would otherwise be focused on developing and expanding our existing business. We may experience losses related to potential investments in other companies, which could materially and adversely affect our business, financial condition, and results of operations. Furthermore, the benefits of any acquisition, strategic alliance, or joint venture may also take considerable time to develop, and we cannot be certain that any particular acquisition, strategic alliance, or joint venture will produce the intended benefits in a timely manner or to the extent anticipated or at all.

Joint ventures inherently involve a lesser degree of control over business strategy and operations, thereby potentially increasing the financial, legal, operational, regulatory, and/or compliance risks associated with them, and require the diversion of financial and management resources from existing operations or alternative opportunities. We may be dependent on partners, controlling shareholders, management, or other persons or entities who control the joint venture and who may have business interests, strategies, or goals that are inconsistent or competitive with ours. Furthermore, joint venture partners receive access to our intellectual property and other resources, which introduces the risk of theft and/or exploitation.

We operate in the United States and may further expand our operations internationally, which may expose us to risks associated with doing business internationally.

We currently operate in the United States and may further expand our operations internationally. As a result, we are and may become increasingly exposed to risks inherent in conducting business outside of the United States. These risks include the following:

• adverse changes in foreign currency exchange rates;
• increased difficulty in protecting any intellectual property rights and trade secrets, including litigation costs and the outcome of such litigation in jurisdictions outside the United States;
• increased exposure to events that could impair our ability to operate internationally with third parties such as problems with such third parties’ operations, finances, insolvency, labor relations, manufacturing capabilities, costs, insurance, natural disasters, public health emergencies, or other catastrophic events;
• unexpected legal or government action or changes in legal or regulatory requirements;
• difficulties in managing, growing, and staffing international operations;
• social, economic, or political instability;
• potential negative consequences from changes to taxation or tariff policies;
• challenges to the transfer pricing of cross-border intercompany transactions;
• increased difficulty in ensuring compliance by employees, agents, and contractors with our policies as well as with the laws of multiple jurisdictions, including international environmental, health, and safety laws and increasingly complex regulations relating to the conduct of international commerce, including import/export laws and regulations, economic sanctions laws and regulations, and trade control; and
• increased exposure to cybersecurity risks in foreign jurisdictions that may materially and adversely affect our business, financial condition and results of operations.

We may incur significant expenses as a result of our international operations, and we may not be successful in converting those expenditures into increased profitability. Our failure to successfully manage these risks could harm our international operations and have an adverse effect on our business, financial condition and results of operations.

Risks Related to Cryptocurrency Mining

If we fail to grow our hashrate, we may be unable to compete, and our business, financial condition, and results of operations could suffer.

Generally, a Scrypt miner’s chance of solving a block on the blockchain networks that utilize Scrypt PoW consensus algorithm (collectively, the “Scrypt Networks”) and earning an associated digital asset block reward and transaction fees is a function of the miner’s hashrate (i.e., the amount of computing power devoted to supporting the Scrypt Networks), relative to the aggregate hashrate of other miners participating in those networks.

As participation in Scrypt Networks increases, the aggregate network hashrate may increase as additional mining companies deploy computing resources to compete for available block rewards. The deployment of new or more efficient mining equipment by competitors could increase overall network difficulty and reduce the proportionate share of rewards earned by any individual miner that does not expand its hashrate at a comparable pace.

Accordingly, to remain competitive, we believe we will need to continue to acquire and deploy additional mining equipment both to replace miners lost to ordinary wear-and-tear or damage and to increase our hashrate in line with growth in the aggregate network hashrate across the Scrypt Networks. There can be no assurance that we will have sufficient capital, access to equipment, or operational capacity to acquire and deploy new miners at the scale or pace necessary to maintain or improve the profitability of our mining operations. See “—We may be unable to purchase miners at scale or face delays or difficulty in obtaining new miners at scale.”

Furthermore, predicting the growth in network hashrate is extremely difficult. Generally, we would expect hashrate increases to be correlated with increases in the market prices of digital assets supported by Scrypt-based blockchain networks, but that has not always been the case. To the extent that hashrate increases but the price of digital assets mined through Scrypt-based blockchain networks does not, there can be no assurance that we would be able to recover our investment in the hardware and processing power required to upgrade our mining operations, and the results of our cryptocurrency mining operations will suffer.

We may be unable to purchase miners at scale or face delays or difficulty in obtaining new miners at scale.

Our cryptocurrency mining operations utilizing the Scrypt PoW consensus algorithm can only be profitable if the costs, inclusive of hardware and electricity costs, associated with mining digital assets are lower than the price of the digital assets mined at the time of sale. As the cost of obtaining new miners increases, the cost of producing digital assets also increases. For example, miners experience ordinary wear-and-tear from operation and may also face more significant malfunctions caused by factors which may be beyond our control. Additionally, as technology evolves, we may acquire newer models of miners to remain competitive in the market. The continual upgrade and refresh of mining machines requires substantial capital investment, and we may face challenges in doing so on a timely basis based on the price and availability of new miners and our access to adequate capital resources.

In the past, we have observed periods of shortage in new miners available for purchase and a delay in delivery schedules for new miner purchases. There is no assurance that miner manufacturers or any other equipment manufacturers will be able to keep pace with potential surges in demand for mining equipment. It is uncertain how manufacturers will respond to increased global demand and whether they fulfill purchase orders fully and in a timely manner. Supply chain issues or geopolitical matters, including the relationship of the United States with China and other countries may also impact equipment manufacturers’ ability to fully and timely fulfill purchase orders. In the event that miner manufacturers or other suppliers are not able to keep pace with, or fail to satisfy, demand, we may not be able to purchase miners or other equipment in sufficient quantities or on the delivery schedules required to meet our business needs. For example, if delivery of our recently purchased Scrypt miners is delayed or prevented, our business, financial condition, and results of operations may suffer. In the past, including for our recent purchase of Scrypt miners, miner manufacturers have required advance deposits for miner purchases. If this continues in the future, we may need to tie up significant amounts of capital for prolonged periods before we receive and are able to deploy purchased miners to generate revenue. Should any suppliers default on purchase agreements with us, we may need to pursue recourse under international jurisdictions, which could be costly and time-consuming. The outcome of any actions initiated in such international jurisdictions, and our ability to enforce judgments (if any) issued in our favor on such jurisdictions is inherently uncertain given differences in legal systems, biases against foreign litigants in certain jurisdictions, and other factors outside our control. Furthermore, there is no guarantee that we would succeed in recovering any of the deposits paid for such purchases, which could materially and adversely affect our business, financial condition, and results of operations.

Our reliance on third-party mining pool service providers, including ViaBTC & Nicehash, for our mining revenue payouts may have a negative impact on our business, financial condition, and results of operations.

We receive digital asset mining rewards from our mining activity through third-party mining pool operators, including ViaBTC & Nicehash. Mining pools allow miners to combine their processing power, increasing their chances of solving a block and getting paid by the network. We provide computing power to mining pools, which use this computing power to operate nodes and validate blocks on the blockchain. The pools then distribute our pro-rata share of digital assets mined to us based on the computing power we contribute.

Under our mining pool agreements with ViaBTC & Nicehash, our daily payout is calculated based on our hashrate contribution delivered to the pool in the applicable calculation period, after deducting the applicable pool fee, if any. Our pool fee in relation to these agreements is currently at or below 2.0% of our daily payout.

Should one of our pool operator’s systems suffer downtime due to a cyberattack, software malfunction or other similar issues, it will negatively impact our ability to mine and receive digital asset mining rewards. Furthermore, we are dependent on the accuracy of the mining pool operators’ record keeping to accurately record the total processing power provided by us and other mining pool participants to the pool for a given digital asset mining application in order to assess the proportion of that total processing power we provided. While we have internal methods of tracking both our processing power provided and the total used by the pool, the mining pool operator uses its own recordkeeping to determine our proportion of a given reward. We have little means of recourse against mining pool operators if we determine the proportion of the reward paid out to us by the mining pool operator is incorrect, other than leaving the pool. If we are unable to consistently obtain accurate proportionate rewards from our mining pool operators, we may experience reduced reward for our efforts, which would have an adverse effect on our business, financial condition, and results of operations.

The further development and acceptance of the Scrypt network and other digital assets is subject to a variety of factors that are difficult to evaluate. The slowing or stopping of the development or acceptance of digital asset systems may adversely affect our business, financial condition, and results of operations.

The use of digital assets to, among other things, buy and sell goods and services and complete transactions, is part of a new and rapidly evolving industry that employs digital assets, based upon a computer-generated mathematical and/or cryptographic protocol. The growth of this industry in general, and the use of Scrypt network currency in particular, is subject to a high degree of uncertainty, and the slowing or stopping of the development or acceptance of developing protocols may occur unpredictably.

Other factors that could affect further development and acceptance of digital asset networks and other digital assets include:

• continued worldwide growth in the adoption and use of digital assets as a medium of exchange or store of value;
• governmental regulation of Bitcoin, Dogecoin, Litecoin, or their use, or restrictions on or regulation of access to and operation of the Bitcoin, Dogecoin, or Litecoin networks or similar digital asset systems;
• limitations on financial institutions processing funds for digital asset transactions, processing wire transfers to or from digital asset exchanges, digital-asset-related companies or service providers, or servicing or maintaining accounts for persons or entities transacting in Bitcoin, Dogecoin, or other digital assets;
• changes in consumer demographics and public tastes and preferences;
• the maintenance and development of the open-source software protocol of the network, including software updates and changes to network protocols that could introduce bugs or security risks;
• the increased consolidation of contributors to the Bitcoin, Litecoin, or Dogecoin blockchains through mining pools;
• the availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies;
• the use of the networks supporting digital assets for developing smart contracts and distributed applications;
• general economic conditions and the regulatory environment relating to digital assets;
• environmental restrictions on the use of power to mine Scrypt Network currency and a resulting decrease in global Scrypt Network mining operations;
• an increase in transaction costs on Bitcoin, Dogecoin, or Litecoin networks and a resultant reduction in the use of and demand for such digital assets; and
• negative consumer sentiment and perception of Bitcoin, Dogecoin, Litecoin or digital assets generally.

The outcome of these factors could have negative effects on our business, financial condition, and results of operations as well as potentially negative effect on the value of any digital asset we mine or otherwise acquire or hold for our own account, which would harm investors in our securities.

The development and acceptance of competing blockchain platforms or technologies may cause consumers to use alternative distributed ledgers or other alternatives.

The development and acceptance of competing blockchain platforms or technologies may cause industry participants and consumers to abandon Scrypt networks. As Scrypt network assets are the only digital asset we mine, we could face difficulty adapting to emergent digital ledgers, blockchains or alternatives thereto. This could prevent us from realizing the anticipated profits from our investments. Such circumstances could have a material adverse effect on our business, financial condition, and results of operations and the value of any digital assets we mine or otherwise acquire or hold for our own account.

Our operations, investment strategies, and profitability may be adversely affected by competition from other methods of investing in Bitcoin, Dogecoin, Litecoin or other digital assets.

We compete with other users and/or companies that are mining Scrypt network digital currency and other digital assets, and we also face significant competition from other users and/or companies that are processing transactions on one or more digital asset networks, as well as other potential financial vehicles, including securities, derivatives or futures backed by, or linked to, digital assets through entities such as exchange-traded funds, including spot Bitcoin exchange-traded funds (ETFs). Market and financial conditions, and other conditions beyond our control, may make it more attractive to invest in other financial vehicles, or to invest in Bitcoin, Dogecoin or Litecoin directly, which could limit the market for shares of our common stock and reduce its liquidity. The emergence of other financial vehicles and exchange-traded funds have been scrutinized by regulators and such scrutiny and the negative impressions or conclusions resulting from such scrutiny could be applicable to us and impact our ability to successfully pursue our strategy or operate at all, or to establish or maintain a public market for our securities. Such circumstances could have a material adverse effect on our business, financial condition, and results of operations and potentially the value of any digital assets we mine or otherwise acquire or hold for our own account, and could harm our investors.

The characteristics of certain Scrypt currencies have been, and may in the future continue to be, exploited to facilitate illegal activity such as fraud, money laundering, tax evasion, and ransomware scams. Furthermore, the exchanges on which Scrypt currency trades are relatively new and, in most cases, largely unregulated and may therefore be more exposed to fraud and failure than established, regulated exchanges for other assets. Such circumstances may result in a reduction in the price of these digital assets and can adversely affect our business, financial condition, and results of operations.

Digital assets mined through Scrypt-based blockchain networks and the exchanges on which such digital assets trade are relatively new and, in most cases, largely unregulated. Certain characteristics, including the speed with which digital asset transactions can be conducted, the ability to conduct transactions without the involvement of regulated intermediaries, the ability to engage in transactions across multiple jurisdictions, the irreversible nature of certain digital asset transactions, and encryption technology that anonymizes these transactions make digital assets, particularly susceptible to use in illegal activity such as fraud, money laundering, tax evasion, and ransomware scams. Furthermore, many digital asset exchanges do not typically provide the public with significant information regarding their ownership structure, management teams, corporate practices, or regulatory compliance. As a result, the marketplace may lose confidence in, or may experience problems relating to, digital asset exchanges, including prominent exchanges handling a significant portion of the volume of digital assets trading.

While we continue to maintain policies and procedures reasonably designed to promote compliance with applicable anti-money laundering and sanctions laws, if we are found to have transacted with bad actors that have used digital assets to launder money or persons subject to sanctions, we may be subject to regulatory proceedings and may be prohibited or restricted from engaging in further transactions or dealings in digital assets. Furthermore, negative perception, a lack of stability in the broader digital asset markets, and the closure or temporary shutdown of digital asset exchanges due to fraud, business failure, hackers, malware, or government-mandated regulation may reduce confidence in digital assets and result in greater volatility in the prices of digital assets. A number of digital asset exchanges have been closed due to fraud, failure, or security breaches. In many of these instances, the customers of such digital asset exchanges were not compensated or made whole for the partial or complete losses of their account balances in such digital asset exchanges. To the extent investors view our common stock as linked to the value of our digital asset holdings, such a negative perception of digital asset exchanges could have a material adverse effect on the price of our common stock.

It may be illegal now, or in the future, to acquire, own, hold, sell, or use digital assets, participate in blockchains or utilize similar digital assets in one or more countries.

Although currently digital assets generally are not regulated or are lightly regulated in most countries, countries such as China have taken harsh regulatory action to curb the use of digital assets and may continue to take regulatory action in the future that could severely restrict the right to acquire, own, hold, sell, or use these digital assets or to exchange them for fiat currency. For example, in 2021 China instituted a blanket ban on all digital asset mining and transactions, including overseas digital asset exchange services taking place in China, effectively making all digital asset-related activities illegal in China. In certain nations, it is illegal to accept payment in Bitcoin or other digital assets for consumer transactions, and banking institutions are barred from accepting deposits of Bitcoin. Such restrictions may adversely affect us as the large-scale use of digital assets as a means of exchange is presently confined to certain regions globally. Such circumstances could have a material adverse effect on our business, financial condition, and results of operations and potentially the value of any digital asset we mine or otherwise acquire or hold for our own account, ultimately harming investors.

A failure to properly monitor and upgrade the Scrypt network’s protocol could damage that network and an investment in our securities.

As open-source projects, blockchain networks that utilize the Scrypt PoW consensus algorithm generally do not generate revenues for their contributors, and contributors are typically not compensated for maintaining or updating the underlying network protocols. The lack of guaranteed financial incentives for contributors to maintain or develop the Scrypt-based network protocols, and the lack of guaranteed resources to adequately address emerging issues with such networks may reduce incentives to address the issues adequately or in a timely manner. To the extent that contributors fail to adequately update and maintain the protocols governing Scrypt-based blockchain networks, there may be a material adverse effect on our business, prospects, or operations and potentially the value of any digital assets we mine or otherwise acquire or hold for our own account.

There is a possibility of Scrypt mining algorithms transitioning to “proof of stake” validation, which could make us less competitive and adversely affect our business, financial condition, and results of operations.

“Proof of stake” is an alternative method in validating digital asset transactions. Should the Scrypt network shift from a “proof of work” validation method to a “proof of stake” validation method, mining would require less energy and may render companies, such as ours, less competitive. Furthermore, if our miners or other mining infrastructure cannot be modified to accommodate changes in rule or protocol of the Scrypt network, our business, financial condition, and results of operations will be significantly affected.

If a malicious actor or botnet obtains control of a majority of the processing power active on any digital asset network, including the Scrypt network, the blockchain may be manipulated in a manner that adversely affects an investment in us.

If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power dedicated to mining on any digital asset network, including the Scrypt network, it may be able to alter the blockchain by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. In such alternate blocks, the malicious actor or botnet could control, exclude, or modify the ordering of transactions, though it could not generate new digital assets or transactions using such control. Using alternate blocks, the malicious actor could “double-spend” its own digital assets (i.e., spend the same digital assets in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintains control. To the extent that such malicious actor or botnet did not yield its control of the processing power on the Scrypt or other network, or the Scrypt or other community did not reject the fraudulent blocks as malicious, reversing any changes made to the blockchain may not be possible.

Miners ceasing operations would reduce the collective processing power on Scrypt-based digital asset networks, which would adversely affect the confirmation process for transactions (i.e., temporarily decreasing the speed at which blocks are added to the applicable blockchain until the next scheduled adjustment in difficulty for block solutions). If a reduction in processing power occurs, Scrypt-based networks, including those underlying Litecoin and Dogecoin, may become more vulnerable to a malicious actor obtaining control in excess of 50% of the processing power on the relevant network. Although as of the date hereof, there are no known reports of malicious activity or permanent control of the Litecoin or Dogecoin blockchains achieved through controlling over 50% of the processing power on such networks, it is believed that certain mining pools may have exceeded, and could exceed, the 50% threshold from time to time. The possible crossing of the 50% threshold indicates a greater risk in that a single mining pool could exert authority over transaction validation, block ordering, or protocol behavior on a Scrypt-based network. To the extent that Scrypt-based digital asset ecosystems, including developers and administrators of mining pools, do not act to ensure greater decentralization of mining processing power, the feasibility of a malicious actor obtaining control of the processing power on one or more of these networks will likely increase, which may adversely impact our business, financial condition, and results of operations.

Weather events and manmade disasters may affect our business.

Severe weather events and other natural or manmade disasters may cause physical damage, disrupt power availability, increase electricity costs, or interrupt services at our colocation sites or those of key vendors. While we may maintain business continuity and disaster recovery plans, such plans may not be effective in all circumstances. Any prolonged disruption could have a material adverse effect on our business, financial condition, and results of operations.

Forks or protocol changes in Scrypt-based digital asset networks may adversely affect the value of digital assets we hold.

Contributors can propose refinements or improvements to the source code governing Scrypt-based digital asset networks, including the protocols and software that govern Litecoin, Dogecoin, or other Scrypt-mined digital assets, and the properties of such assets, including transaction finality, block rewards, and issuance schedules. These changes may result in a “fork.” In the event a developer or group of developers proposes modifications that are not accepted by a majority of miners and users, but are nonetheless accepted by a substantial plurality, two or more competing and incompatible blockchain implementations could result running in parallel, yet lacking interchangeability and necessitating exchange-type transactions to convert assets between the forks. This is commonly referred to as a “hard fork.”

The value of digital assets following the creation of a fork is subject to many factors, including the value of the forked asset, market reaction, network adoption, and the occurrence of additional forks in the future. It may be unclear following a fork which blockchain represents the original asset and which represents a new asset. If we hold Bitcoin, Litecoin, Dogecoin, or other digital assets at the time of a hard fork, industry standards may dictate that we would be expected to hold an equivalent amount of the old and new assets following the fork.

However, we may not be able, or it may not be practical, to secure or realize the economic benefit of the new asset for various reasons. For example, we may determine that there is no safe or practical way to custody the new asset, that attempting to do so may pose an unacceptable risk to our existing holdings, or that the costs of taking possession of or maintaining ownership of the new digital asset exceed the benefits of owning it. Additionally, laws, regulations, or other factors may prevent us from benefiting from the new asset even if custody is technically feasible. As a result, we may not be able to realize the economic benefit of a fork, either immediately or at all, which could adversely affect the value of the digital assets we hold and our business, financial condition, and results of operations.

We may curtail the energy used by our Scrypt-based digital asset mining operations during periods of elevated energy prices, grid congestion, or power shortages, either voluntarily or pursuant to agreements with utility providers or grid operators. We may also encounter circumstances in which utilities or government entities restrict or prohibit the provision of electricity to digital asset mining operations.

In such cases, our ability to mine Litecoin, Dogecoin, or other Scrypt-based digital assets may be negatively affected, which could reduce our operating revenues and adversely impact our business, financial condition, and results of operations.

Third parties may assert intellectual property or other legal claims relating to the holding, transfer, mining, or validation of digital assets, including Bitcoin, Litecoin, Dogecoin, and their associated source code or consensus mechanisms. Regardless of the merit of any such claim, any threatened action that reduces confidence in the long-term viability of one or more digital asset networks, or in the ability of end-users to hold or transfer digital assets, may adversely affect the value of the digital assets we hold and our business, financial condition, and results of operations.

Additionally, a meritorious intellectual property claim could prevent us or other participants from accessing one or more digital asset networks or from holding, transferring, or mining certain digital assets. As a result, an intellectual property claim against us or other significant network participants could materially adversely affect our business, financial condition, and results of operations.

We are highly concentrated in Bitcoin, Dogecoin, and Litecoin, each of which is highly volatile. Fluctuations in the prices of these digital assets have influenced, and are likely to continue to influence, our business, financial condition, results of operations, and the market price of our common stock.

Currently, our investments and treasury strategy are highly concentrated in Bitcoin, Dogecoin, and Litecoin. We generate revenue from digital asset rewards earned through self-mining operations, including Scrypt-based mining, and we may also acquire additional digital assets through market purchases to build and manage our digital asset reserves. As a result, our business, financial condition, and results of operations are materially exposed to price movements in these digital assets.

Bitcoin, Dogecoin, and Litecoin have each experienced significant price volatility, and fluctuations in their prices have in the past influenced, and are likely to continue to influence, our operating results and the market price of our common stock. Our business, financial condition, results of operations, and the market price of our common stock would be adversely affected if the market price of any or all of these digital assets were to decline substantially, including as a result of:

• decreased user, miner, and investor confidence in Bitcoin, Dogecoin, or Litecoin, including due to the various factors described herein;
• investment and trading activities, including (i) trading activities of highly active retail and institutional users, speculators, miners, and investors, (ii) actual or expected significant dispositions of Bitcoin, Dogecoin, or Litecoin by large holders, including funds or vehicles investing in or tracking digital asset markets, and (iii) actual or perceived manipulation of spot or derivative markets for these digital assets or related exchange-traded products;
• negative publicity, media coverage, or sentiment relating to Bitcoin, Dogecoin, Litecoin, or the broader digital asset industry, including, for example, (i) public perception that digital assets may be used to circumvent sanctions or to fund criminal or terrorist activities; (ii) expected or pending civil, criminal, regulatory, or enforcement actions against major digital asset industry participants; (iii) bankruptcies or insolvencies of major participants in the digital asset ecosystem; and (iv) actual or perceived environmental impacts associated with digital asset mining, including concerns regarding energy consumption;
• changes in consumer preferences or perceptions regarding the value, utility, or long-term prospects of Bitcoin, Dogecoin, Litecoin or other digital assets;
• competition from other digital assets or blockchain-based technologies that may offer perceived advantages in speed, security, scalability, energy efficiency, functionality, or regulatory acceptance;
• declines in the prices of other digital assets, including stablecoins, or the failure, de-pegging, or unavailability of stablecoins used as trading or settlement instruments in digital asset markets, to the extent such events reduce confidence in digital assets generally or adversely affect the prices of Bitcoin, Dogecoin, or Litecoin;
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• disruptions, failures, outages, or interruptions in service of digital asset exchanges, trading platforms, or market infrastructure supporting Bitcoin, Dogecoin, or Litecoin;
• cyber-attacks, theft, or loss of digital assets from custodians, wallet providers, exchanges, or other market participants, or publicity relating to such events;
• bankruptcy filings, liquidations, or financial distress involving digital asset custodians, exchanges, lending platforms, investment funds, or other ecosystem participants;
• regulatory, legislative, judicial, or enforcement actions that adversely affect the ownership, transferability, trading volumes, legality, valuation, or public perception of Bitcoin, Dogecoin, Litecoin or other digital assets, or that restrict the ability of digital asset market participants to operate;
• reductions in mining rewards or incentives, including changes to block rewards, protocol-level economics, or increases in costs associated with mining operations, including electricity, hardware, or infrastructure costs, which could reduce network participation or security;
• scalability limitations, including transaction congestion, settlement delays, or increased transaction fees on the underlying networks;
• macroeconomic conditions, including changes in interest rates, inflation, monetary or fiscal policy, capital market conditions, or currency devaluations;
• advances in mathematics, cryptography, or computing, including developments in quantum computing, that could compromise or undermine the cryptographic security of one or more digital asset networks; and
• changes in domestic or international economic, political, or geopolitical conditions.

From time to time, we have entered, and may continue to enter, into certain hedging transactions to mitigate our exposure to fluctuations in the market prices of Bitcoin, Dogecoin, and Litecoin, which represent the substantial majority of our digital asset holdings by value. Engaging in hedging transactions may expose us to risks associated with such transactions, including counterparty risk.

Hedging against a decline in the value of our digital asset holdings caused by volatility in Bitcoin, Dogecoin, and Litecoin prices does not eliminate the possibility of fluctuations in the values of such holdings or prevent losses if the values of such holdings decline for reasons other than those being hedged. Such hedging transactions may also limit the opportunity for gain if the market prices of these digital assets increase.

Moreover, it may not be possible to hedge against particular price movements that are so generally anticipated by the market that a hedging transaction at an acceptable price is unavailable. In light of these and other factors, we may not be successful in mitigating our exposure to volatility in the prices of Bitcoin, Dogecoin, and Litecoin through any hedging transactions we undertake.

We hold Bitcoin, Dogecoin, and Litecoin as principal components of our treasury and operating strategy and, as a result of merged Scrypt mining, we may also receive and hold other digital assets in de minimis amounts from time to time.

Our digital asset holdings are not insured, and we do not hold such assets with a banking institution or a member of the Federal Deposit Insurance Corporation (“FDIC”) or the Securities Investor Protection Corporation (“SIPC”). Accordingly, our digital assets are not subject to the protections enjoyed by depositors with FDIC- or SIPC-member institutions. Instead, we safeguard our material digital asset holdings by utilizing third-party custody solutions, including Anchorage Digital Bank, and Coinbase Prime. Although our custodians employ security measures such as redundancy, segregation, and cold storage designed to reduce the risk of loss, damage, or theft, neither we nor our custodians can guarantee that such loss, damage, or theft will not occur, whether due to cyber-attack, human error, insider misconduct, technical failure, or force majeure events. Furthermore, although the custodian maintains insurance coverage for certain cyber and operational risks, such coverage may be subject to limitations, exclusions, or coverage caps and may be insufficient to fully compensate us for potential losses. Given the concentrated nature of our digital asset holdings, including our holdings of Bitcoin, Dogecoin, and Litecoin, risks such as security breaches, cyber-attacks, operational failures, or the risk that our digital assets could be deemed property of a bankruptcy estate of a custodian are of particular concern. See “- Due to the evolving nature of insolvency law and market practice, digital assets held in custody for customers may be treated as part of a custodian’s bankruptcy estate.” Any loss, whether temporary or permanent, of our digital assets could adversely affect our business, financial condition, and results of operations.

Bitcoin, Dogecoin, Litecoin, and other digital assets are controlled through cryptographic key pairs associated with blockchain addresses, and transactions are authorized through cryptographic signing mechanisms implemented by the applicable custody platform. When transactions are executed, relevant transaction data, including public blockchain addresses, is recorded on the applicable blockchain network.

We do not directly possess, manage, or control private keys or seed phrases associated with the majority of our digital assets. Substantially all of our digital assets are held with third-party qualified custodians that maintain exclusive control over key-management infrastructure on our behalf. As a result, we rely on the operational integrity, internal controls, security architecture, and financial condition of such custodians to maintain continuous access to our digital assets.

Any failure, disruption, or compromise of a custodian’s systems, internal controls, authorization processes, or key-management infrastructure could result in delayed access to, partial loss of, or permanent loss of our digital assets. It is possible that, through computer malfunction, software bugs, human error, insider misconduct, theft, or other criminal acts at a custodian or other service provider, our digital assets could be transferred in incorrect amounts or to unauthorized third parties. Transactions involving Bitcoin, Dogecoin, Litecoin, and other digital assets are generally irreversible, and any digital assets that are stolen or incorrectly transferred may be irretrievable.

As a result, we may have limited or no effective means of recovering digital assets that are lost, stolen, or misdirected, including where such losses arise from the actions or failures of third-party custodians or other service providers. Any such losses could adversely affect our business, financial condition, and results of operations.

Digital assets and the blockchain networks on which they operate have been, and may in the future be, subject to security breaches, cyberattacks, or other malicious activity.

Bitcoin and Scrypt-based digital assets, including Litecoin and Dogecoin, as well as the infrastructure supporting custody, settlement, and trading of digital assets, may be vulnerable to cyberattacks, insider misconduct, technical failures, or other security incidents. A successful security breach or compromise affecting us, our custodians, our OTC counterparties, or other service providers could result in partial or total loss of our digital assets, or restrict our ability to access or transfer such assets, which may not be covered by insurance or indemnification arrangements. In addition, access to our digital assets could be disrupted by natural disasters, severe weather events, or human actions such as terrorism or sabotage. Any such loss, delay, or restriction could have a material adverse effect on our business, financial condition, and results of operations.

Due to the evolving nature of insolvency law and market practice, digital assets held in custody for customers may be treated as part of a custodian’s bankruptcy estate.

We maintain substantially all of our digital assets in cold-storage custody arrangements with third-party custodians, including Anchorage Digital and Coinbase Prime. Although we generally expect that digital assets held in custody for customers would not be treated as part of a custodian’s bankruptcy estate, insolvency law and market practice relating to digital assets remain evolving and untested in certain respects.

If, in the event of a bankruptcy or insolvency of a custodian, any digital assets held on our behalf were nevertheless deemed to be property of the bankruptcy estate, such assets could become subject to bankruptcy proceedings and we could be treated as a general unsecured creditor. This could inhibit our ability to access or exercise ownership rights over our digital assets on a timely basis or at all, and any such outcome could materially adversely affect our business, financial condition, and results of operations.

Transactions executed through OTC counterparties may expose us to operational and counterparty risks.

In connection with our treasury management activities, including opportunistic sales of digital assets, we may execute transactions through OTC counterparties and through agency-desk or similar execution services offered by our custodians. These activities expose us to operational and counterparty risks, including settlement delays or failures, transaction errors, compromised instructions, unauthorized transfers, disputes regarding trade terms, and counterparty insolvency. Even when transactions are executed through established intermediaries, no security or control system is infallible, and failures across the digital asset industry demonstrate that market participants may be undercapitalized, operationally weak, or susceptible to fraud or cyberattack. Any actual or perceived incident affecting our execution counterparties or the broader market infrastructure could impair our ability to transact, result in losses, and damage our reputation, any of which could adversely affect our business, financial condition, and results of operations.

We may face risks related to liquidity.

Liquidity risk is the risk that we will not be able to meet our financial obligations as they come due. We fund our obligations primarily from cash and cash equivalents and may, from time to time, elect to sell digital assets in opportunistic market windows to fund working capital needs, satisfy obligations, or support growth initiatives. Our liquidity may be adversely affected by declines in digital asset prices, increases in operating costs (including power and hosting costs), reduced mining profitability, adverse regulatory developments, or broader capital market volatility. We may not be able to raise additional funds in a timely manner, in sufficient amounts, or on terms acceptable to us, if at all. Any such financing could result in significant dilution to existing shareholders, and any debt financing could impose restrictive covenants and create claims senior to equity. If we are unable to generate sufficient liquidity from operations, asset sales, or financings, we may be required to reduce or delay capital expenditures, curtail growth initiatives, or otherwise materially alter our strategy, which could have a material adverse effect on our business, financial condition, and results of operations.

Adverse developments to Scrypt-based blockchain networks may impact mining revenue streams.

Our mining operations are entirely dependent on the Scrypt mining algorithm. As a result, adverse developments affecting Scrypt-based blockchain networks, including changes to protocol incentives, merged-mining dynamics, transaction fee economics, or miner participation, could simultaneously impact all of our mining revenue streams. Unlike miners that operate across multiple proof-of-work algorithms, we do not have the ability to reallocate computing power to alternative networks without incurring significant capital expenditures, operational disruption, or downtime. Any sustained deterioration in the economics of Scrypt-based mining could materially and adversely affect our business, financial condition, and results of operations.

The pseudonymous nature of blockchain transactions poses a risk that our digital assets may be associated with illicit or sanctioned activities.

U.S. sanctions laws administered by the Office of Foreign Assets Control restrict dealings with sanctioned persons and jurisdictions. Due to the pseudonymous nature of blockchain transactions, there is a risk that digital assets we receive, hold, or transfer in connection with mining proceeds or treasury sales could be associated, directly or indirectly, with sanctioned persons or illicit activity. Although we may implement policies and controls designed to mitigate these risks, such controls may not be fully effective. Any actual or alleged violation could result in investigations, fines, penalties, reputational harm, and restrictions on our ability to transact, which could materially adversely affect our business, financial condition, and results of operations.

There are risks associated with derivative transactions involving digital assets.

We engage in derivatives transactions on Bitcoin, Dogecoin, and Litecoin for hedging purposes. These transactions expose us to additional risks, including basis risk, liquidity risk, margin and collateral requirements, mark-to-market volatility, model risk, operational risk, and counterparty risk. Hedging strategies may be ineffective or may limit our ability to benefit from favorable price movements. In stressed market conditions, hedging instruments may be unavailable or prohibitively expensive, and we may incur losses on hedges at the same time we experience losses on the underlying assets. In addition, the regulatory treatment of digital asset derivatives continues to evolve, and changes in regulatory interpretations or requirements could subject us to increased compliance obligations and costs.

Risks Related to Digital Assets

The trading prices of many digital assets, including Bitcoin, Dogecoin, and Litecoin have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including declines in the trading prices of Bitcoin, Dogecoin, or Litecoin, could have a material adverse effect on the value of our common stock and the digital assets held in our treasury could lose all or substantially all of their value.

The trading prices of many digital assets, including Bitcoin, Dogecoin and Litecoin, have experienced extreme volatility throughout their existence, including in recent periods and may continue to do so. In 2025, Dogecoin traded in the range of $0.3408 to $0.1313, Bitcoin traded in the range of $126,198 to $74,436, and Litecoin traded in the range of $140.62 to $63.75.

Extreme volatility in the future, including declines in the trading prices of Bitcoin, Dogecoin, or Litecoin could have a material adverse effect on the value of the digital assets in our treasury. Bitcoin represents the largest component of our digital asset treasury by value, and accordingly, fluctuations in the price of Bitcoin may have a disproportionate impact on our financial condition. In addition, declining prices could have a material adverse effect on our revenues. Furthermore, negative perception and a lack of stability and standardized regulation in the digital asset economy may reduce confidence in the digital asset economy and may result in greater volatility in the price of Bitcoin, Dogecoin, Litecoin and other digital assets, including a depreciation in value.

Furthermore, changes in U.S. political leadership and economic policies may create uncertainty that materially affects the price of Dogecoin. For example, on March 6, 2025, President Trump signed an Executive Order to establish a Strategic Bitcoin Reserve and a United States Digital Asset Stockpile. Pursuant to this Executive Order, the Strategic Bitcoin Reserve will be capitalized with Bitcoin owned by the Department of Treasury that was forfeited as part of criminal or civil asset forfeiture proceedings, and the Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional Bitcoin, provided that those strategies impose no incremental costs on American taxpayers. Conversely, the Digital Asset Stockpile will consist of all digital assets other than Bitcoin owned by the Department of Treasury that were forfeited in criminal or civil asset forfeiture proceedings, but the U.S. government will not acquire additional assets for the U.S. Digital Asset Stockpile beyond those obtained through such proceedings. The anticipation of a U.S. government-funded strategic cryptocurrency reserve had motivated large-scale purchases of certain digital assets in the expectation of the U.S. government acquiring such assets to fund such reserve. Any similar action or omission by the U.S. government or other government authorities with respect to Bitcoin, Dogecoin, or other digital assets may negatively and significantly impact the price of such digital assets and our revenues. Because Bitcoin is our primary treasury asset by value and we receive settlement in Bitcoin through our hashrate marketplace monetization model, government actions affecting Bitcoin may have a particularly significant impact on our business.

Digital assets such as Bitcoin and Dogecoin were only introduced within the past two decades, and the medium-to-long term value of Bitcoin, Dogecoin, and other digital assets we hold is subject to a number of factors relating to the capabilities and development of blockchain technologies and to the fundamental investment characteristics of digital assets.

Digital assets such as Bitcoin and Dogecoin were only introduced within the past two decades, and the medium-to-long term value of the digital assets we hold is subject to a number of factors relating to the capabilities and development of blockchain technologies, such as the recency of their development, their dependence on the Internet and other technologies, dependence on the role played by users, developers and validators and the potential for malicious activity. For example, the realization of one or more of the following risks could materially adversely affect the value of Bitcoin, Dogecoin, other digital assets, our treasury reserve and our revenues:

• Digital asset networks and related protocols are in the early stages of development. Given the recency of the development of digital asset networks and related protocols, digital assets and the underlying digital asset networks and related protocols may not function as intended and parties may be unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks and related protocols.
• The loss of access to a private key required to access a digital asset may be irreversible. If a private key is lost and no backup of the private key is accessible, or if the private key is otherwise compromised, the owner would be unable to access the digital asset corresponding to that private key.
• Digital asset networks and related protocols are dependent upon the Internet. A disruption of the Internet or a digital asset network or related protocol, such as the Bitcoin, Litecoin, or Dogecoin networks, would affect the ability to transfer digital assets, including Dogecoin, and, consequently, their value.
• The acceptance of software patches or upgrades to a digital asset network by a significant, but not overwhelming, percentage of the users and validators in a digital asset network, such as the Bitcoin, Litecoin, or Dogecoin networks, could result in a “fork” in such network’s blockchain, resulting in the operation of multiple separate blockchain networks. See – “Forks or protocol changes in Scrypt-based digital asset networks may adversely affect the value of digital assets we hold.”
• Many digital asset networks face significant scaling challenges and are being upgraded with various features to increase the speed and throughput of digital asset transactions. These attempts to increase the volume of transactions may not be effective.
• The open-source structure of many digital asset network protocols, such as the protocol for the Bitcoin and Dogecoin networks, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset may lack a financial incentive to maintain or develop the network or may lack the resources to adequately address emerging issues. Alternatively, some developers may be funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to properly monitor and upgrade the protocol of these networks could damage that network.
• Moreover, in the past, flaws in the source code for digital asset networks and related protocols have been exposed and exploited, including flaws that disabled some functionality for users, exposed users’ personal information and/or resulted in the theft of users’ digital assets. The cryptography underlying Bitcoin, Litecoin, or Dogecoin could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective.

In any of these circumstances, a malicious actor may be able to take the digital assets held in our treasury, which would adversely affect the value of our common stock. Moreover, functionality of the Dogecoin or Bitcoin networks may be negatively affected by such an exploit such that they are no longer attractive to users, thereby dampening demand for such digital assets. Even if a digital asset other than those we hold were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital asset networks and related protocols generally could negatively affect the demand for digital assets and therefore adversely affect the value of the digital assets held in our treasury. Moreover, because digital assets, including Bitcoin and Dogecoin, have existed for a relatively short period of time and are continuing to be developed, there may be additional risks to digital asset networks and related protocols that are impossible to predict as of the date of this proxy statement.

Digital assets represent a new and rapidly evolving industry, and the value of the digital assets held in our treasury depends on the continued acceptance of Bitcoin, Dogecoin, and other digital assets we hold.

The first digital asset, Bitcoin, was launched in 2009, and Litecoin launched in 2011. Dogecoin launched in 2013 and its development is ongoing. Bitcoin serves as the primary settlement asset under our hashrate marketplace model and represents the largest component of our treasury by value. In general, digital asset networks, including the Dogecoin network and related protocols represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate. For example, the realization of one or more of the following risks could materially adversely affect the value of the digital assets held in our treasury, including Bitcoin, Dogecoin, and Litecoin:

• Bitcoin and Dogecoin are only selectively accepted as a means of payment by retail and commercial outlets, and use of Bitcoin and Dogecoin by consumers remains limited. Banks and other established financial institutions, whether voluntarily or in response to regulatory feedback, may refuse to process funds for cryptocurrency transactions; process wire transfers to or from digital asset trading platforms, cryptocurrency-related companies or service providers; or maintain accounts for persons or entities transacting in cryptocurrency. As a result, the prices of Bitcoin, Dogecoin, and other digital assets are largely determined by speculators and validators, thus contributing to price volatility that makes retailers less likely to accept them in the future.
• Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as Bitcoin or Dogecoin, and their or its utility as a payment system, which could decrease the price of digital assets generally or individually.
• The prices of digital assets may be determined on a relatively small number of digital asset trading platforms by a relatively small number of market participants, many of whom are speculators or those intimately involved with the issuance of such digital assets, such as validators or developers, which could contribute to price volatility that makes retailers less likely to accept digital assets in the future.
• Certain privacy-preserving features have been or are expected to be introduced to a number of digital asset networks. If any such features are introduced to the Bitcoin or Dogecoin networks, any trading platforms or businesses that facilitate transactions in these cryptocurrencies may be at an increased risk of criminal or civil lawsuits, or of having banking services cut off if there is a concern that these features interfere with the performance of anti-money laundering duties and economic sanctions checks.
• Users, developers and validators may switch to or adopt certain digital asset networks or protocols at the expense of their engagement with other digital asset networks and protocols, which may negatively impact those networks and protocols..

Changes in the governance of a digital asset network or protocol may not receive sufficient support from users and validators, which may negatively affect that digital asset network’s or protocol’s ability to grow and respond to challenges.

The governance of some digital asset networks and protocols, such as the Dogecoin and Bitcoin networks, is generally by voluntary consensus and open competition. For such networks and protocols, there may be a lack of consensus or clarity on that network’s or protocol’s governance, which may stymie such network’s or protocol’s utility, adaptability and ability to grow and face challenges. The foregoing notwithstanding, the underlying software for some digital networks and protocols, such as the Dogecoin network, is informally or formally managed or developed by a group of core developers that propose amendments to the relevant network’s or protocol’s source code. Core developers’ roles may evolve over time, generally based on self-determined participation. If a significant majority of users and validators were to adopt amendments to the Dogecoin network based on the proposals of such core developers, the Dogecoin network would be subject to new source code that may adversely affect the value of Dogecoin. As a result of the foregoing, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems, especially long-term problems, on digital asset networks.

Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful.

Many digital asset networks face significant scaling challenges due to the fact that public, permissionless blockchains generally face a tradeoff between security and scalability. One means through which digital asset networks that utilize public, permissionless blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization of a public, permissionless blockchain generally means a given digital asset network is less susceptible to manipulation or capture. In practice, this typically means that every single node on a given digital asset network is responsible for securing the system by processing every transaction and maintaining a copy of the entire state of the network. As a result, a digital asset network that utilizes a public, permissionless blockchain may be limited in the number of transactions it can process by the computing capabilities of each single fully participating node. Many developers are actively researching and testing scalability solutions for public blockchains that do not necessarily result in lower levels of security or decentralization, such as off-chain payment channels and sharding. Off-chain payment channels would allow parties to transact without requiring the full processing power of a blockchain. Sharding can increase the scalability of a database, such as a blockchain, by splitting the data processing responsibility among many nodes, allowing for parallel processing and validating of transactions.

If a malicious actor or botnet obtains control of more than 50% of the processing power on the Dogecoin network, or otherwise obtains control over the Dogecoin network through its influence over core developers or otherwise, such actor or botnet could manipulate the Blockchain to adversely affect the value of the Dogecoin held in our treasury reserve or our ability to operate.

If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power on the Dogecoin network, it may be able to alter the blockchain on which transactions in Dogecoin rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet may not be able to generate new digital assets or transactions using such control, it may be able to “double-spend” its own digital assets (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control. To the extent that such malicious actor or botnet did not yield its control of the processing power on the Dogecoin network or the Dogecoin community did not reject the fraudulent blocks as malicious, reversing any changes made to the Blockchain may not be possible. Further, a malicious actor or botnet could create a flood of transactions in order to slow down the Dogecoin network.

For example, in August 2020, the Ethereum Classic network was the target of two double-spend attacks by an unknown actor or actors that gained more than 50% of the processing power of the Ethereum Classic network. The attack resulted in reorganizations of the Ethereum Classic blockchain that allowed the attacker or attackers to reverse previously recorded transactions in excess of over $5.0 million and $1.0 million. Any similar attacks on the Dogecoin network could negatively impact the value of Dogecoin and the value of the Dogecoin held in our treasury reserve upon the consummation of the Acquisition.

Moreover, certain mining pools have exceeded in the past, and may exceed now or in Dogecoin’s future, the 50% threshold on the Dogecoin network. The failure of any mitigating steps, or any future attacks on the Dogecoin network, could negatively impact the value of Dogecoin and the value of the Dogecoin held in our Treasury Reserve.

A malicious actor may also obtain control over the Dogecoin network through its influence over core developers by gaining direct control over a core developer or an otherwise influential programmer. To the extent that the Dogecoin ecosystem does not grow, the possibility that a malicious actor may be able to maliciously influence the Dogecoin network in this manner will remain heightened.

The value of the shares of our common stock may relate directly to the value of the digital assets we hold, particularly Bitcoin and Dogecoin, the values of which may be highly volatile and subject to fluctuations due to a number of factors.

We expect that the value of our shares of common stock and our revenues will in large part will relate directly to the value of the digital assets we hold, particularly Bitcoin and Dogecoin, and fluctuations in the prices of Bitcoin and Dogecoin could adversely affect the value of our common stock. Because we receive settlement primarily in Bitcoin through our hashrate marketplace model and Bitcoin represents the largest component of our digital asset treasury by value, the market price of Bitcoin is a particularly significant factor. The market prices of Bitcoin and Dogecoin may be highly volatile, and subject to a number of factors, including, but not limited to:

• an increase in the global Bitcoin and Dogecoin supply that is publicly available for trading;
• manipulative trading activity on digital asset trading platforms, which, in many cases, are largely unregulated;
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• the adoption of Bitcoin, Dogecoin, or other cryptocurrencies as a medium of exchange, store-of-value or other consumptive asset and the maintenance and development of the open-source software protocol of the Bitcoin or Dogecoin networks;
• forks in the Bitcoin or Dogecoin networks;
• investors’ expectations with respect to interest rates, the rates of inflation of fiat currencies or cryptocurrencies, and digital asset trading platform rates;
• consumer preferences and perceptions of Bitcoin and Dogecoin specifically and digital assets generally;
• fiat currency withdrawal and deposit policies on digital asset trading platforms;
• the liquidity of digital asset markets and any increase or decrease in trading volume on digital asset markets;
• investment and trading activities of large investors that invest directly or indirectly in Bitcoin or Dogecoin;
• a “short squeeze” resulting from speculation on the price of Bitcoin or Dogecoin, if aggregate short exposure exceeds the number of Bitcoin or Dogecoin available for purchase;
• an active derivatives markets for Bitcoin, Dogecoin, and for digital assets generally;
• a final determination that Dogecoin is a security or changes in Dogecoin’s status under the federal securities laws;
• monetary policies of governments, trade restrictions, currency devaluations and revaluations and regulatory measures or enforcement actions, if any, that restrict the use of Bitcoin, Dogecoin, or other cryptocurrencies as a form of payment or the purchase of Bitcoin or Dogecoin on the digital asset markets;
• global or regional political, economic or financial conditions, events and situations;
• fees associated with processing a Bitcoin or Dogecoin transaction and the speed at which Bitcoin or Dogecoin transactions are settled on the Dogecoin network;
• interruptions in service from or closures or failures of major digital asset trading platforms;
• decreased confidence in digital asset trading platforms due to the largely unregulated nature and lack of transparency surrounding the operations of digital asset trading platforms;
• increased competition from other forms of digital assets or payment services; and
• our own acquisitions or dispositions of Bitcoin, Dogecoin, or other cryptocurrencies, since there is no limit on the amount of digital assets that we may acquire as part of our treasury reserve strategy.

In addition, there is no assurance that Bitcoin, Dogecoin, or Litecoin will maintain their value in the long or intermediate term. In the event that the prices of these digital assets decline, particularly Bitcoin, we expect that the value of our shares of common stock may decline as well.

Due to the largely unregulated nature and lack of transparency surrounding the operations of digital asset trading platforms, they may experience fraud, market manipulation, business failures, security failures or operational problems, which may adversely affect the value of Dogecoin, Bitcoin & Litecoin and, consequently, the value of our treasury reserve and our shares of Common Stock.

Digital asset trading platforms are relatively new and, in many ways, are not subject to, or may not comply with, regulation in relevant jurisdictions in a manner similar to other regulated trading platforms, such as national securities exchanges or designated contract markets. While many prominent digital asset trading platforms provide the public with significant information regarding their on-chain activities, ownership structure, management teams, corporate practices, cybersecurity practices and regulatory compliance, many other digital asset trading platforms do not provide this information. Furthermore, while digital asset trading platforms are and may continue to be subject to federal and state licensing requirements in the United States, digital asset trading platforms do not currently appear to be subject to regulation in a similar manner as other regulated trading platforms, such as national securities exchanges or designated contract markets. As a result, the marketplace may lose confidence in digital asset trading platforms, including prominent trading platforms that handle a significant volume of Bitcoin, Litecoin, or Dogecoin trading.

Many digital asset trading platforms, both in the United States and abroad, are unlicensed, not subject to, or not in compliance with, regulation in relevant jurisdictions, or operate without extensive supervision by governmental authorities. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions and may take the position that they are not subject to laws and regulations that would apply to a national securities exchange or designated contract market in the United States, or may, as a practical matter, be beyond the ambit of U.S. regulators. As a result, trading activity on or reported by these digital asset trading platforms is generally significantly less regulated than trading activity on or reported by regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. Any actual or perceived false trading in the digital asset trading platform market, and any other fraudulent or manipulative acts and practices, could adversely affect the value of Bitcoin, Litecoin, or Dogecoin and/or negatively affect the market perception of these digital assets, which could in turn adversely impact the value of the digital assets held in our treasury reserve and the price of our shares of common stock.

The SEC has also identified possible sources of fraud and manipulation in the digital asset markets generally, including, among others (1) “wash-trading”; (2) persons with a dominant position in a digital asset manipulating pricing in such digital asset; (3) hacking of the underlying digital asset network and trading platforms; (4) malicious control of the underlying digital asset network; (5) trading based on material, non-public information (for example, plans of market participants to significantly increase or decrease their holdings in a digital asset, new sources of demand for a digital asset) or based on the dissemination of false and misleading information; (6) manipulative activity involving purported “stablecoins,” including Tether; and (7) fraud and manipulation at digital asset markets. The use or presence of such acts and practices in the digital asset markets could, for example, falsely inflate the volume of Dogecoin, Bitcoin or Litecoin present in the digital asset markets or cause distortions in the price of Dogecoin, Bitcoin or Litecoin, among other things that could adversely affect our shareholders. Moreover, tools to detect and deter fraudulent or manipulative trading activities, such as market manipulation, front-running of trades, and wash-trading, may not be available to or employed by digital asset markets, or may not exist at all. Many digital asset markets also lack certain safeguards put in place by exchanges for more traditional assets to enhance the stability of trading on the exchanges and prevent “flash crashes,” such as limit-down circuit breakers. As a result, the prices of Dogecoin on digital asset markets may be subject to larger and/or more frequent sudden declines than assets traded on more traditional exchanges.

In addition, over the past several years, some digital asset trading platforms have been closed, been subject to criminal and civil litigation and have entered into bankruptcy proceedings due to fraud and manipulative activity, business failure and/or security breaches. In many of these instances, the customers of such digital asset trading platforms were not compensated or made whole for the partial or complete losses of their account balances in such digital asset trading platforms. In some instances, customers are made whole only in dollar terms as of the digital asset trading platform’s date of failure, rather than on a digital asset basis, meaning customers may still lose out on any price increase in digital assets.

Negative perception, a lack of stability and standardized regulation in the digital asset markets and/or the closure or temporary shutdown of digital asset trading platforms due to fraud, business failure, security breaches or government mandated regulation, and associated losses by customers, may reduce confidence in the Bitcoin, Litecoin, or Dogecoin networks and result in greater volatility in the prices of these assets. These potential consequences of such a digital asset trading platform’s failure could adversely affect the price of shares of our common stock.

A decline in the adoption of Bitcoin, Litecoin or Dogecoin, or their respective networks, could negatively impact our revenues and treasury value.

A lack of expansion in usage of Bitcoin, Litecoin or Dogecoin, or their respective networks could adversely affect an investment in shares of our common stock.

The further development and acceptance of the Bitcoin, Litecoin and Dogecoin networks, which is part of a new and rapidly changing industry, is subject to a variety of factors that are difficult to evaluate. The slowing, stopping or reversing of the development or acceptance or usage of the Bitcoin, Litecoin or Dogecoin networks may adversely affect the price of these assets and therefore an investment in shares of our common stock. The further adoption of Bitcoin, Litecoin or Dogecoin will require growth of their respective networks. Adoption of cryptocurrencies will also require an accommodating regulatory environment.

The use of digital assets such as Bitcoin, Litecoin or Dogecoin to, among other things, buy and sell goods or services or facilitate cross-border payments is part of a new and rapidly evolving industry that employs digital assets based upon computer-generated mathematical and/or cryptographic protocols. The Bitcoin, Litecoin and Dogecoin networks are a prominent, but not unique, part of this industry. The growth of this industry is subject to a high degree of uncertainty, as new assets and technological innovations continue to develop and evolve.

Today, speculators make up a significant portion of users of Bitcoin, Litecoin, Dogecoin and other cryptocurrencies. Certain merchants and major retail and commercial businesses have only recently begun accepting cryptocurrencies and digital asset networks as a means of payment for goods and services. Speculation may contribute to outsized price volatility, which in turn can make forms of payment like Bitcoin, Litecoin and Dogecoin less attractive to merchants and commercial parties as a means of payment. A lack of expansion by Bitcoin, Litecoin or Dogecoin into retail and commercial markets or a contraction of such use may result in a reduction in the price of these assets, which could adversely affect an investment in our Company.

In addition, there is no assurance that Bitcoin, Litecoin, Dogecoin, or other cryptocurrencies will maintain their value over the long term. The prices of these assets are subject to risks related to their usage. Even if growth in Bitcoin, Litecoin or Dogecoin network adoption occurs in the near or medium term, there is no assurance that such usage will continue to grow over the long term. A contraction in use of Bitcoin, Litecoin or Dogecoin may result in increased volatility or a reduction in the price of these assets, which would adversely impact the price of our common stock.

Congestion or delay in the Bitcoin or Dogecoin networks may delay our ability to transact in or sell our digital assets.

Increased transaction volume could result in delays in the recording of transactions due to congestion in the Bitcoin or Dogecoin networks. Moreover, unforeseen system failures, disruptions in operations, or poor connectivity may also result in delays in the recording of transactions on the Bitcoin or Dogecoin networks. Any delay in the Bitcoin or Dogecoin networks could affect our ability to buy or sell digital assets at an advantageous price, resulting in decreased confidence in these networks. Because we receive settlement primarily in Bitcoin and hold Bitcoin as our largest treasury asset by value, congestion on the Bitcoin network could particularly affect our ability to manage treasury assets. Over the longer term, delays in confirming transactions could reduce the attractiveness of these digital assets to merchants and other commercial parties. As a result, these networks and our revenues would be adversely affected.

The SEC may approve applications under Rule 19b-4 of the Exchange Act to list competing digital assets as exchange-traded products, which could reduce demand for, and the price of, Dogecoin and adversely impact our common stock.

To date, the SEC has only approved applications under Rule 19b-4 of the Exchange Act to list spot digital asset exchange-traded products which hold Bitcoin and Ether. However, applications for competing digital assets have been filed and are currently pending, and there can be no guarantee the SEC will not one day approve any such application. If applications to list spot digital asset exchange-traded products are approved for additional digital assets, to the extent such competing digital asset exchange-traded products come to represent a significant proportion of the demand for digital assets generally, demand for, and the prices of, Bitcoin, Dogecoin, and other digital assets we hold could be reduced. Such reduced demand could in turn negatively affect the value of our common stock. Accordingly, there can be no assurance that we will be able to maintain our scale and achieve its intended competitive positioning relative to competitors, which could adversely affect our revenues and the price of our common stock.

Competition from central bank digital currencies and emerging payments initiatives involving financial institutions could adversely affect the price of Bitcoin, Dogecoin and other digital assets.

Central banks in various countries have introduced digital forms of legal tender. China’s CBDC project, known as Digital Currency Electronic Payment, has reportedly been tested in a live pilot program conducted in multiple cities in China. Central banks representing at least 130 countries have published retail or wholesale CBDC work ranging from research to pilot projects. Whether or not they incorporate blockchain or similar technology, CBDCs, as legal tender in the issuing jurisdiction, could have an advantage in competing with, or replace, Bitcoin, Dogecoin and other cryptocurrencies as a medium of exchange or store of value. Central banks and other governmental entities have also announced cooperative initiatives and consortia with private sector entities, with the goal of leveraging blockchain and other technology to reduce friction in cross-border and interbank payments and settlement, and commercial banks and other financial institutions have also recently announced a number of initiatives of their own to incorporate new technologies, including blockchain and similar technologies, into their payments and settlement activities, which could compete with, or reduce the demand for, Bitcoin and Dogecoin. As a result of any of the foregoing factors, the price of Bitcoin, Dogecoin and other digital assets could decrease, which could adversely affect an investment in our company.

The prices of Bitcoin and Dogecoin may become closely correlated with other asset classes.

Returns from investing in Bitcoin and Dogecoin have at times diverged from and/or have not been correlated with those associated with other asset classes, but there can be no assurance that there will be any such divergence, either generally or with respect to any particular asset class, or that price movements will not be correlated. In addition, there is no assurance that Bitcoin or Dogecoin will maintain their value in the long, intermediate, short, or any other term. In the event that the prices of Bitcoin or Dogecoin decline, the value of our common stock is likely to decline as well.

Dogecoin was originally considered a “memecoin” and may be subject to even greater levels of volatility than other digital assets.

Memecoins are cryptocurrencies inspired by Internet memes or trends. Most memecoins have no stated use case or intrinsic value, other than as a digital collector’s item. While most memecoins have relatively low trading prices and trading volume, occasionally a memecoin will develop an enthusiastic community of supporters that cause the memecoin to go “viral” on social networks and other mediums. These memecoins will often experience unpredictable and extreme price fluctuations over very short windows of time. Memecoins have also been used in “rug pulls”, where the developers of the memecoin abandon a project after raising assets, leaving purchasers of the memecoin with nearly worthless assets. Memecoins are also commonly the subject of other forms of market manipulation, such as pump and dump, wash trading or spoofing schemes.

Dogecoin is often considered the first memecoin. Dogecoin was initially developed in 2013 by the software developers Billy Markus and Jackson Palmer as a way of making fun of Bitcoin and other digital assets, which they believed were being taken too seriously. Dogecoin was designed as a “fun and friendly Internet currency,” and adopted the image of a Shibu Inu dog as its logo. Despite, or perhaps because of, its satirical origins, Dogecoin gained rapid interest and adoption in online communities, and rapidly became one of the larger digital assets when measured by market capitalization. Users soon began using Dogecoin for certain financial transactions, including tipping, trading, and donations. Since its inception, the software underlying Dogecoin has been upgraded to be more secure and more comparable to other major digital assets, and it has recently experienced volatility generally similar to other major digital assets. However, Dogecoin still has a large following in the online meme community. Dogecoin’s history as a memecoin may cause it to experience periods of extreme volatility which may affect the value of our Dogecoin holdings and therefore our common stock.

The Litecoin Network Halving Event May Materially and Adversely Affect the Company’s Mining Economics.

The Litecoin network is expected to undergo its next block reward halving event in August 2027, at which time the block subsidy awarded to Scrypt miners will be reduced by 50%. Because the Company’s mining operations utilize Scrypt-based ASIC hardware, a portion of the Company’s mining revenue is derived from, or influenced by, the economics of the Litecoin network. A halving event reduces the rate at which new Litecoin is issued as a block reward, which, absent a corresponding and offsetting increase in the market price of Litecoin, would reduce the revenue generated per unit of hashrate deployed by the Company. There can be no assurance that the market price of Litecoin will increase sufficiently, or at all, to offset the reduction in block rewards following the halving.

The unlimited supply of Dogecoin may negatively impact the long-term value of Dogecoin, and potentially the integrity of the Dogecoin network.

Unlike certain other digital assets such as Bitcoin or Litecoin, Dogecoin has an unlimited supply. New Dogecoin is mined every day, and that production has no cap. The unlimited nature of Dogecoin’s supply may negatively impact the value of Dogecoin. Additionally, without continuous new demand, the value of Dogecoin is likely to decline over time as additional Dogecoin is produced.

The unlimited nature of Dogecoin supply could negatively impact the adoption of Dogecoin and the integrity of the Dogecoin network if it contributes to a decline in the value of Dogecoin, as that value is what incentivizes parties to participate in the Dogecoin network. By contrast, Bitcoin has a fixed supply cap of 21 million coins; however, the Company’s strategy of mining Scrypt and converting to Bitcoin through our hashrate marketplace model means that the economics of our Scrypt mining operations, including Dogecoin-related dynamics, directly affect our ability to accumulate Bitcoin in our treasury.

Regulators may interpret certain aspects of our activities to implicate additional regulatory frameworks.

Although we do not operate as a money transmitter, exchange, or hosted-wallet provider, regulatory interpretations relating to digital assets may change. To the extent regulators were to interpret aspects of our activities, including treasury execution or related processes, as implicating additional regulatory frameworks, we could incur increased compliance costs and operational constraints, which could adversely affect our business, financial condition, and results of operations.

From time to time, we may be involved in legal or regulatory proceedings arising in the ordinary course of business or otherwise. Such matters can be costly, time-consuming, divert management attention, and result in damages, penalties, or required changes to our business practices. The outcome of such proceedings is inherently uncertain, and any adverse outcome could materially adversely affect our business, financial condition, and results of operations.

A determination that one or more of our digital assets is a “security” may adversely affect the value of such digital assets, our treasury and our common stock.

In the recent past, the SEC has stated that certain digital assets may be considered “securities” under the federal securities laws. On March 17, 2026, SEC issued a new interpretive release (SEC Interpretive Rel. 33-11412) entitled Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets (the “Release”). In the Release, the SEC significantly clarified the application of the federal securities laws to certain types of crypto assets and transactions involving crypto assets. The Release classifies crypto assets into five categories: digital commodities, digital collectibles, digital tools, stablecoins and digital securities. Applying the traditional Howey test, the Release explains that digital commodities, digital collectibles, digital tools, and stablecoins will generally not be considered securities so long as they are not the subject of an “investment contract,” which is defined as any contract, transaction, or scheme whereby a person invests money in a common enterprise and reasonably expects profits to be derived from the efforts of others.

A digital commodity is a crypto asset that is intrinsically linked to and derives its value from the programmatic operation of a crypto system that is functional, as well as supply and demand dynamics, rather than from the expectation of profits from the essential managerial efforts of others. Specific examples digital commodities named in the Release include Bitcoin, Litecoin, and Dogecoin, among several others. The Release also addresses several types of digital asset activities, including protocol mining and staking. Protocol mining on a proof-of-work network, either individually or as part of a pool, will generally not require the registration of transactions under the Securities Act, as the miners contribute their own computational resources in exchange for crypto asset rewards.

Based on the interpretations given in the Release, we do not believe that our Scrypt-based proof-of-work activities are subject to registration under the Securities Act or that the primary crypto assets that we earn through our activities or otherwise acquire are “securities” within the meaning of the Securities Act. The tests for determining whether a particular digital asset is a “security” and whether a particular transaction involving digital assets requires registration under the Securities Act, however, are fact-intensive, complex, and may be difficult to apply. If it is determined in the future that one or more digital assets in which we transact or that we hold in our treasury is a security, or that the types of transactions we conduct or may conduct in the future require registration with the SEC, it could have a material adverse effect.

If a digital asset or transactions in that digital asset are determined to be a security or securities transactions, respectively, it is likely to become difficult or impossible for that digital asset to be traded, cleared or custodied in the United States through the same channels used by non-security digital assets, which in addition to materially and adversely affecting the trading value of the digital asset, is likely to significantly impact its liquidity and market participants’ ability to convert the digital asset into U.S. dollars. Any assertion that a digital asset or transactions in that digital asset are a security or securities transactions, respectively, by the SEC or another regulatory authority may have similar effects.

In addition, if one or more digital assets held in our treasury is determined to be a security by a federal court, or transactions in those transactions are determined to be securities transactions by a federal court, depending on the size of our treasury reserve, we could be considered an unregistered “investment company” under the Investment Company Act of 1940, as amended, if 40% or more of our assets other than cash and government securities are deemed to be invested in investment securities.

Legislative developments such as the CLARITY Act may alter the regulatory treatment of bitcoin and adversely affect our business.

On May 29, 2025, the U.S. House of Representatives introduced H.R. 3633, the Digital Asset Market Clarity Act of 2025 (the “CLARITY Act”), which passed the House on July 17, 2025, and is currently pending review by the U.S. Senate. If enacted as proposed, the CLARITY Act would classify certain digital assets as “digital commodities” and expand the jurisdiction of the Commodity Futures Trading Commission (the “CFTC”) over such assets. As a result, certain activities involving digital assets, including trading, custody, advisory, or fundraising transactions, could become subject to new compliance obligations under the Commodity Exchange Act. In addition, the CLARITY Act as currently drafted contains a provision that would prohibit platforms from paying users any “interest-like” yield solely for holding a stablecoin in a wallet or account, including any return that could be deemed economically equivalent to interest on a bank deposit.

While it is uncertain whether the CLARITY Act will be enacted in its current form, or whether transitional relief or exemptions would be available to us, any such reclassification of certain digital assets could materially increase our compliance costs and subject us to additional reporting, operational and governance requirements. Furthermore, to the extent the CLARITY Act is enacted with a provision prohibiting the offering of yields on stablecoin holdings, such prohibition could materially reduce the incentive for investors to hold stablecoins, which could adversely affect liquidity and trading volumes across the digital asset markets. Any such changes could have a material adverse effect on our business strategy, financial condition, results of operations and the market price of our common stock.

Regulatory changes or actions by the U.S. Congress or any U.S. federal or state agencies may affect the value of Bitcoin, Dogecoin or Litecoin or restrict the use of these currencies to validate activity or the operation of the digital asset markets in a manner that adversely affects our revenues and the value of our common stock.

As digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, OFAC, SEC, CFTC, FINRA, the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Federal Reserve and state financial institution and securities regulators) have been examining the operations of digital asset networks, digital asset users and the digital asset markets, with particular focus on the extent to which digital assets can be used to launder the proceeds of illegal activities, evade sanctions, or fund criminal or terrorist enterprises and the safety and soundness of trading platforms and other service providers that hold or custody digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. Ongoing and future regulatory actions with respect to digital assets generally or Dogecoin in particular may alter, perhaps to a materially adverse extent, the nature of an investment in our common stock or our ability of to continue to operate in the Dogecoin business.

On January 23, 2025, President Trump issued an executive order titled “Strengthening American Leadership in Digital Financial Technology” aimed at supporting “the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy.” The Executive Order also established an interagency working group that is tasked with “proposing a Federal regulatory framework governing the issuance and operation of digital assets” in the United States. Pursuant to this Executive Order, the working group released a report in July 2025 outlining the administration’s recommendations to Congress and various agencies reflecting the administrations “pro-innovation mindset toward digital assets and blockchain technologies.” In particular, the report recommends that Congress enact legislation regarding self- custody of digital assets, clarifying the applicability of Bank Secrecy Act obligations with respect to digital asset service providers, granting the CFTC authority to regulate spot markets in non-security digital assets, prohibiting the adoption of a CBDC, and clarifying tax laws as relevant to digital assets. In addition, the report recommends that agencies reevaluate existing guidance on digital asset activities, use existing authorities to enable the trading of digital assets at the federal level, embrace Decentralized Finance, launch or relaunch crypto innovation efforts, and promote U.S. private sector leadership in the responsible development of cross-border payments and financial markets technologies, among others.

There have also been several bills introduced in Congress that propose to establish additional regulation and oversight of the digital asset markets. In July 2025, the Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025 became the first federal law specifically regulating the issuance, custody and other stablecoin-related matters in the United States. The CLARITY Act was passed by the House of Representatives in July 2025, which would, if enacted, regulate digital asset markets and digital asset trading platforms in the United States. It is difficult to predict whether, or when, the CLARITY Act or another bill that would regulate digital asset markets and digital asset trading platforms may become law or what any such Bill may entail. It is difficult to predict whether, or when, any of these developments will lead to Congress granting additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how additional legislation and/or regulatory oversight might impact the ability of digital asset markets to function or how any new regulations or changes to existing regulations might impact the value of digital assets generally and Dogecoin specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on our revenues, our business and the price of our common stock. In 2008, a Democratic President and Democratic Congress can enact new legislation reversing the de-regulatory impact of the Trump Administration on digital assets and Dogecoin. Further, the SEC could then revert to its enforcement campaign against digital assets which was conducted under the Biden Administration.

Law enforcement agencies have often relied on the transparency of blockchains to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital asset networks. If the Dogecoin network were to adopt any of these features, these features may provide law enforcement agencies with less visibility into transaction-level data. In August 2022, OFAC banned all U.S. citizens from using Tornado Cash, a digital asset protocol designed to obfuscate blockchain transactions, by adding certain Ethereum wallet addresses associated with the protocol to its Specially Designated Nationals and Blocked Persons List. A large portion of Ethereum validators globally, as well as notable industry participants such as Centre, the issuer of the USDC stablecoin, have reportedly complied with the sanctions and blacklisted the sanctioned addresses from interacting with their networks. In October 2023, FinCEN issued a notice of proposed rulemaking that identified convertible virtual currency (“CVC”) mixing as a class of transactions of primary money laundering concern and proposed requiring covered financial institutions to implement certain recordkeeping and reporting requirements on transactions that covered financial institutions know, suspect, or have reason to suspect involve CVC mixing within or involving jurisdictions outside the United States. Promoters of Tornado Cash were criminally convicted in the Netherlands in 2024 and the U.S. in 2025. Future additional regulatory action with respect to privacy-enhancing digital assets is possible.

Changes in SEC policy could adversely impact our revenues, our business and the price of our common stock.

In addition to the wholesale SEC regulatory change discussed above, the SEC is currently free to adopt new regulations to meet changes in the digital assets business. The effect of any future regulatory change on Bitcoin, Litecoin, Dogecoin and digital assets, including a determination that certain digital assets are a “security” is impossible to predict, but such change could be substantial and adverse to our revenues, business and the price of our common stock. In particular with regard to funds that hold Bitcoin, Ether and certain Bitcoin-based derivatives or Ether-based derivatives, the SEC has not yet approved the listing on a national securities exchange of any non-futures based digital-asset focused exchange-traded fund or exchange-traded product. If the SEC were to adopt new regulations to meet changes that were adverse to the digital assets industry in the future our revenues and the value of our common stock may decline.

Ambiguous and changing governmental regulations relating to Scrypt-based digital asset mining may adversely affect our business.

Our business, which is focused on Scrypt-based digital asset mining at colocation sites in the United States and related treasury activities, operates in a regulatory environment that is rapidly evolving and subject to differing interpretations. Many applicable laws and regulations predate digital assets and do not address key issues associated with mining, custody, or secondary-market trading. Regulatory requirements may change, be interpreted inconsistently across jurisdictions, or conflict with one another, and governmental authorities may disagree with our compliance positions. We may be subject to examinations, audits, investigations, and enforcement actions by federal, state, or local authorities, and new laws, regulations, or enforcement priorities could increase our costs, restrict or prohibit certain activities, limit access to power, or otherwise adversely affect our business, financial condition, and results of operations.

Digital asset mining is energy-intensive and may attract scrutiny from regulators, policymakers, and other stakeholders. Legislative or regulatory actions relating to energy usage, emissions, permitting, grid reliability, or related reporting obligations could increase our operating costs, require changes to our operations, limit expansion, or restrict our ability to operate at certain sites. In addition, adverse publicity or stakeholder activism relating to the environmental impact of digital asset mining, whether accurate or not, could damage our reputation and adversely affect our business.

Competing industries may have more influence with policymakers than the digital asset industry, which could lead to the adoption of laws and regulations that are harmful to the digital asset industry.

The digital asset industry is relatively new, although its influence over public policy is increasing, and it may not have the same access to policymakers and lobbying organizations in many jurisdictions compared to industries with which digital assets may be seen to compete, such as banking, payments and consumer finance. Competitors from other, more established industries may have greater access to and influence with governmental officials and regulators and may be successful in persuading these policymakers that digital assets require heightened levels of regulation compared to the regulation of traditional financial services. As a result, new laws and regulations may be proposed and adopted in the United States and elsewhere, or existing laws and regulations may be interpreted in new ways, that disfavor or impose compliance burdens on the digital asset industry or digital asset platforms, which could adversely impact the value of our digital assets and therefore the price of our common stock.

Regulatory changes or other events in foreign jurisdictions may affect the value of our common stock or restrict the use of one or more digital assets, validating activity or the operation of their networks or the digital asset trading platform market in a manner that adversely affects the value of our common stock.

Various foreign jurisdictions have, and may continue to adopt laws, regulations or directives that affect the digital asset network, the digital asset markets, and their users, particularly digital asset trading platforms and service providers that fall within such jurisdictions’ regulatory scope. For example, if foreign jurisdictions in addition to China were to ban or otherwise restrict validating activity, including by regulating or limiting manufacturers’ ability to produce or sell semiconductors or hard drives in connection with validating, it would have a material adverse effect on digital asset networks (including the Dogecoin network), our ability to secure and/or repair computes that we use in our Scrypt mining, the digital asset market, and as a result, impact the value of our common stock.

A number of foreign jurisdictions have recently taken regulatory action aimed at digital asset activities. China has made transacting in cryptocurrencies illegal for Chinese citizens in mainland China, and additional restrictions may follow. Both China and South Korea have banned initial coin offerings entirely and regulators in other jurisdictions, including Canada, Singapore and Hong Kong, have opined that initial coin offerings may constitute securities offerings subject to local securities regulations. The United Kingdom’s Financial Conduct Authority published final rules in October 2020 banning the sale of derivatives and exchange-traded notes that reference certain types of digital assets, contending that they are “ill-suited” to retail investors citing extreme volatility, valuation challenges and association with financial crime. A new law, the Financial Services and Markets Act 2023, received royal assent in June 2023. The FSMA brings digital asset activities within the scope of existing laws governing financial institutions, markets and assets. In addition, the Parliament of the European Union approved the text of the markets in Crypto-Assets Regulation in April 2023, establishing a regulatory framework for digital asset services across the European Union. Certain parts of MiCA became effective as of June 2024 and the remainder became effective as of December 2024. MiCA is intended to serve as a comprehensive regulation of digital asset markets and imposes various obligations on digital asset issuers and service providers. The main aims of MiCA are industry regulation, consumer protection, prevention of market abuse and upholding the integrity of digital asset markets.

Foreign laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of one or more digital assets by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the digital asset economy in the European Union, China, Japan, Russia and the United States and globally, or otherwise negatively affect the value of Dogecoin. Moreover, other events, such as the interruption in telecommunications or Internet services, cyber-related terrorist acts, civil disturbances, war or other catastrophes, could also negatively affect the digital asset economy in one or more jurisdictions. For example, Russia’s invasion of Ukraine led to volatility in digital asset prices, with an initial steep decline followed by a sharp rebound in prices. The effect of any future regulatory change or other events on Dogecoin is impossible to predict, and such change could be substantial and adverse to our revenues, business and the price of our common stock.

Future developments regarding the treatment of digital assets for U.S. federal income tax purposes could adversely affect the value of the digital assets that we hold in our treasury reserve and the price of our common stock.

Many significant aspects of the U.S. federal income tax treatment of digital assets, are uncertain, and it is unclear what guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. It is possible that any such guidance would have an adverse effect on the prices of digital assets, including on the price of Bitcoin, Litecoin, and Dogecoin in the digital asset markets, and therefore may have an adverse effect on the value of our treasury reserve and the price of our common stock.

Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets, including forks, airdrops and similar occurrences. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes.

Future developments in the treatment of digital assets for tax purposes other than U.S. federal income tax purposes could adversely affect the value of our common stock.

The taxing authorities of certain states, including New York, (i) have announced that they will follow the notice with respect to the treatment of digital assets for state income tax purposes and/or (ii) have issued guidance exempting the purchase and/or sale of digital assets for fiat currency from state sales tax. However, it is unclear what further guidance on the treatment of digital assets for state tax purposes may be issued in the future.

The treatment of digital assets for tax purposes by non-U.S. jurisdictions may differ from the treatment of digital assets for U.S. federal, state or local tax purposes. It is possible, for example, that a non-U.S. jurisdiction would impose sales tax or value-added tax on purchases and sales of digital assets for fiat currency. If a foreign jurisdiction with a significant share of the market of Dogecoin. Bitcoin or Litecoin users imposes onerous tax burdens on digital asset users, or imposes sales or value-added tax on purchases and sales of digital assets for fiat currency, such actions could result in decreased demand for these digital assets in such jurisdiction.

Any future guidance on the treatment of digital assets for state, local or non-U.S. tax purposes could result in adverse tax consequences to us and could have an adverse effect on the prices of digital assets, including on the price of Dogecoin in the digital asset markets. As a result, any such future guidance could have an adverse effect on the value of the Dogecoin held in our treasury reserve and the price of our common stock.

A U.S. tax-exempt shareholder may recognize “unrelated business taxable income” as a consequence of an investment in shares of our common stock.

Under the guidance provided in the Internal Revenue Service’s Frequently Asked Questions, hard forks, airdrops and similar occurrences with respect to digital assets will under certain circumstances be treated as taxable events giving rise to ordinary income. In the absence of guidance to the contrary, it is possible that any such income recognized by a U.S. tax-exempt shareholder would constitute “unrelated business taxable income” or UBTI. A tax-exempt shareholder should consult its tax adviser regarding whether such shareholder may recognize UBTI as a consequence of an investment in our common stock.

General Risk Factors

If securities or industry analysts do not publish research or reports about our business, or if they change their recommendations regarding our stock adversely, our stock price and trading volume could decline.

The trading market for our common stock may be influenced by the research and reports that industry or securities analysts publish about us or our business. Even if our analyst coverage increases, if one or more of the analysts who cover us downgrade our stock, our stock price would likely decline. If one or more of these analysts cease coverage of our Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Financial reporting obligations of being a public company in the United States are expensive and time-consuming, and our management will be required to devote substantial time to compliance matters.

As a publicly traded company we incur significant legal, accounting and other expenses. The obligations of being a public company in the United States require significant expenditures and places significant demands on our management and other personnel, including costs resulting from public company reporting obligations under the Exchange Act and the rules and regulations regarding corporate governance practices, including those under Sarbanes-Oxley, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and the listing requirements of Nasdaq. These rules require the establishment and maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting and changes in corporate governance practices, among many other complex rules that are often difficult to implement, monitor and maintain compliance with. Moreover, despite reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will make some activities more time-consuming and costly, since we are no longer an “emerging growth company.” Our management and other personnel will need to devote a substantial amount of time to ensure that we comply with all of these requirements and to keep pace with new regulations, otherwise we may fall out of compliance and risk becoming subject to litigation or being delisted, among other potential problems.

Risks Related to Our Common Stock

Lapsed lockup restrictions may create downward pressure on the market price of our common stock.

Certain shareholders are subject to contractual lockup restrictions that are scheduled to expire in tranches following the consummation of our business combination with Doge on December 16, 2025. Specifically, one-third of the Company-imposed lockup restrictions applicable to certain shareholders were released on December 16, 2025, with an additional one-third scheduled were released on March 16, 2026, and the remaining one-third scheduled to be released on June 15, 2026. The ability of these shareholders to sell their shares upon the expiration of lockup restrictions is subject to applicable securities law requirements. A portion of these shares were registered for resale pursuant to a registration statement on Form S-3 filed on January 29, 2026, which was declared effective on January 30, 2026. Holders of shares registered pursuant to that registration statement may resell their shares without restriction under the Securities Act upon the applicable lockup expiration.

Shares of common stock that were not registered under the Form S-3 registration statement remain subject to the volume limitations, holding period requirements, and other conditions of Rule 144 under the Securities Act. These holders may be unable to sell their shares immediately upon lockup expiration and must satisfy the applicable Rule 144 conditions, including any required holding period measured from the date of acquisition.

As these lockup restrictions expire in tranches through June 2026, a substantial number of shares may become eligible for sale, which could create selling pressure and downward pressure on the market price of our common stock. The perception that significant shareholders may sell shares could also negatively affect investor sentiment and increase volatility.

Our common stock price may be volatile, which could result in substantial losses to investors and litigation.

In addition to changes to market prices based on the our results of operations and the factors discussed elsewhere in this “Risk Factors” section, the market price of and trading volume for our common stock has been and may continue to be volatile for a variety of other reasons, not necessarily related to the our actual operating performance. The capital markets have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of the our common stock. In addition, the average daily trading volume of the securities of small companies can be very low, which may contribute to future volatility. Factors that could cause the market price of our common stock to fluctuate significantly include:

• the impact of financings;
• the results of operating and financial performance and prospects of other companies in the same industry;
• strategic actions by us or our competitors, such as acquisitions or restructurings;
• announcements of innovations, increased service capabilities, new or terminated customers or new, amended or terminated contracts by competitors;
• the public’s reaction to our press releases, other public announcements, and filings with the SEC;
• lack of securities analyst coverage or speculation in the press or investment community;
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• changes in earnings estimates or recommendations by securities or research analysts who track the Company’s common stock or failure of the Company’s actual results of operations to meet those expectations;
• changes in government policies in the United States and internationally for Bitcoin, Dogecoin, Litecoin, and digital asset mining generally;
• market and industry perception of our success, or lack thereof, in pursuing our growth strategy;
• changes in accounting standards, policies, guidance, interpretations or principles;
• any lawsuit involving us, our services or our products;
• arrival and departure of key personnel;
• sales of common stock by large investors, officers and directors; and
• changes in general market, economic and political conditions in the United States and financial markets.

Any of these factors, as well as broader market and industry factors, may result in large and sudden changes in the trading volume of our common stock and could depress the market price of our common stock, regardless of our operating performance. This may prevent an investor from being able to sell its shares at or above the price the investor paid for its shares of common stock, if at all. In addition, following periods of volatility in the market price of a company’s securities, shareholders often institute securities class action litigation against that company. Following our announcement of the pending acquisition of Doge, at least one class action law firm advertised for clients to sue us. We do not know if we will be sued. Our involvement in any class action suit or other legal proceeding could divert its senior management’s attention and could adversely affect the our business, financial condition, results of operations and prospects.

If we fail to comply with the rules under the Sarbanes-Oxley Act of 2002, as amended, related to accounting controls and procedures, or if we discover material weaknesses and deficiencies in our internal control and accounting procedures, our stock price could decline significantly and raising capital could be more difficult.

If we fail to comply with the rules under the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley Act”), related to disclosure controls and procedures, or, if we discover material weaknesses and other deficiencies in our internal control and accounting procedures, our stock price could decline significantly and raising capital could be more difficult. Section 404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting. If material weaknesses or significant deficiencies are discovered or if we otherwise fail to achieve and maintain the adequacy of our internal control, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Moreover, effective internal controls are necessary for us to produce reliable financial reports and are important to helping prevent financial fraud. If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock could drop significantly.

Future sales and issuances of our securities could result in additional dilution of the percentage ownership of our shareholders and could cause our share price to fall.

We expect that significant additional capital will be needed in the future to continue our planned operations, including research and development, increased marketing, hiring new personnel, commercializing our products, and continuing activities as an operating public company. To the extent we raise additional capital by issuing equity securities, our shareholders may experience substantial dilution. We may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from time to time. If we sell common stock, convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales. Such sales may also result in material dilution to our existing shareholders, and new investors could gain rights superior to our existing shareholders.

We do not intend to pay cash dividends on our shares of common stock so any returns will be limited to the value of our shares.

We have never paid or declared any cash dividends on our common stock, and we do not anticipate paying any cash dividends on our common stock in the foreseeable future. We currently anticipate that we will retain future earnings for the development, operation and expansion of our business. Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon a number of factors, including our results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors that our board of directors deems relevant. Therefore, any return to shareholders will be limited to the increase, if any, of our share price.

We are a “smaller reporting company”, and the reduced disclosure requirements applicable to smaller reporting companies may make our common stock less attractive to investors.

We are a “smaller reporting company” as defined in Rule 12b-2 under the Exchange Act. We would cease to be a smaller reporting company if (i) we have a public float of $250 million or more and have annual revenues in excess of $100 million or (ii) if we have a public float of $700 million or more, determined on an annual basis.

As a smaller reporting company, we are permitted and intend to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not smaller reporting companies. These exemptions include:

• not being required to furnish a stock performance graph in our Annual Reports;
• reduced disclosure obligations regarding executive compensation;
• being permitted to provide only two years of audited financial statements in our Annual Reports on Form 10-K, with corresponding reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations” disclosure; and
• not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act.

We cannot predict whether investors will find our common stock less attractive as a result of any reliance by us on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

We may be at risk of securities class action litigation.

We may be at risk of securities class action litigation. In the past, biotechnology and pharmaceutical companies have experienced significant stock price volatility, particularly when associated with binary events such as clinical trials and product approvals. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business and result in a decline in the market price of our common stock.

To date, we have not experienced any cybersecurity incidents that materially affected our business strategy, results of operations or financial condition. The Company recognizes the critical importance of cybersecurity in safeguarding sensitive information, maintaining operational resilience, and protecting stakeholders’ interests.

The Company is in the process of establishing a cybersecurity policy which will implement protocols to evaluate, recognize, and address significant risks, including those posed by cybersecurity threats. This policy will be designed to establish a comprehensive framework for identifying, assessing, mitigating, and responding to cybersecurity risks across the organization and will encompass the utilization of standard traffic monitoring tools, educating personnel to identify and report abnormal activities, and partnering with reputable service providers capable of upholding security standards equivalent to or exceeding our own.

We anticipate that these measures will be seamlessly integrated into our broader operational risk management framework aimed at minimizing exposure to unnecessary risks across our operations. For cybersecurity, we intend to collaborate with expert consultants and third-party service providers to implement industry-standard strategies aimed at identifying and mitigating potential threats or vulnerabilities within our systems. Additionally, it is anticipated that our policy will have a comprehensive cyber crisis response plan to manage high severity security incidents, ensuring efficient coordination across the organization.

To date, cybersecurity threats have not materially impacted our operations; however, given the escalating sophistication of cyber threats, our preventive measures may not always suffice. We may be unable to anticipate all security breaches, including those stemming from third-party misuse of AI technologies and the potential challenges in implementing timely preventive measures. Please refer to Item 1A: Risk Factors for information relating to cyber attack-related risks.

We anticipate that our Chief Financial Officer will be responsible for overseeing our information security programs, including cybersecurity initiatives, and will be integrated into our Cybersecurity Incident response process. We also anticipate that our Audit Committee will oversees cybersecurity risk management activities, supported by Company management, the board of directors, and external consultants.

Our operations are principally operated remotely at various data centers throughout the United States and we do not own any real property. Our offices are located at 470 W 200 N STE 18 Salt Lake City, UT 84103 and are leased pursuant to a lease agreement that renews in successive six-month terms. We believe that our existing facilities are suitable and adequate to meet our current needs. We intend to add new facilities or expand existing facilities as we add employees, and we believe that suitable additional or substitute space will be available as needed to accommodate any such expansion of our operations.

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are not aware of any pending legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes appearing elsewhere in this Annual Report. In addition to historical information, the following discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See “Cautionary Note on Forward-looking Statements” for a discussion of the uncertainties and assumptions associated with these statements. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included elsewhere in this Annual Report on Form 10-K.

OVERVIEW

Datacentrex, Inc. (“Datacentrex,” the “Company,” “we,” “us,” or “our”) is a digital infrastructure and capital deployment company that owns and operates Scrypt-based proof-of-work (“PoW”) compute assets. On December 15, 2025, the Company consummated the acquisition of Doge through a reverse recapitalization (the “Transaction”), following which the combined company changed its name to Datacentrex, Inc. Doge, the accounting acquirer, had commenced digital asset mining operations prior to the Transaction. The following discussion reflects the operations of Doge and its successors for the full fiscal year ended December 31, 2025, which represents the Company’s inaugural year of mining operations. There was no comparable activity in the prior-year period.

We generate revenue by deploying owned Scrypt application-specific integrated circuit (“ASIC”) hardware to produce PoW hashrate, which we monetize primarily through a hashrate marketplace model with settlement typically denominated in Bitcoin. Our Scrypt compute contributes hashrate to the Litecoin blockchain, and through merged-mining architecture, simultaneously secures and validates additional Scrypt-based networks, including Dogecoin, without incremental energy consumption. The Company’s mining operations produce exposure to multiple digital asset networks from a single deployment of compute and power, with Dogecoin representing the largest share of protocol-native coin production during the period and Bitcoin representing the primary settlement asset received through marketplace monetization channels.

We manage a treasury of digital assets and cash intended to preserve capital, maintain liquidity, and enhance long-term value creation. As of December 31, 2025, the Company held over $4.5 million in digital assets, comprising a mix of Bitcoin accumulated through hashrate marketplace settlement and unsold Dogecoin and Litecoin from pool-based mining. Management expects that future treasury concentration will favor Bitcoin over time, consistent with the Company’s hashrate marketplace monetization model in which settlement is typically received in Bitcoin.

Fiscal Year 2025 Operational Highlights

Fiscal year 2025 represented the Company’s inaugural year of digital asset mining operations, during which the Company scaled from initial deployment to a fully operational mining platform. Key operational highlights for the year include:

Fleet Scaling and Deployment. The Company began the first quarter of 2025 with an initial deployment of approximately 1,500 Scrypt ASIC miners at a single colocation facility outside of the United States. During the second quarter, the Company evaluated additional colocation partners and deployed approximately 1,000 additional units across two new domestic colocation sites. In the third quarter, in response to changes in the tariff environment and to capture lower operating expenses, the Company relocated the original fleet of approximately 1,500 miners back to the United States and distributed them across two facilities. In the fourth quarter, the Company deployed an additional 520 rigs, bringing the total operating fleet to 3,094 Scrypt ASIC miners as of December 31, 2025, deployed across four geographically diversified colocation facilities, all located in the United States.

Hashrate and Power Capacity. As of December 31, 2025, the Company’s fleet of 3,094 operating Scrypt ASIC miners had an average nameplate capacity of approximately 14 GH/s per unit, representing aggregate deployed hashrate of approximately 43.3 TH/s at full uptime. The fleet’s average nameplate power consumption was approximately 3.95 kW per unit, representing approximately 12.5 MW of total deployed power capacity across the Company’s four colocation facilities.

Revenue and Financial Performance. For the year ended December 31, 2025, the Company generated revenues of approximately $7.0 million from digital asset mining operations, with cost of revenue of approximately $3.6 million and gross profit of approximately $3.4 million. The Company reported a net loss attributable to common stockholders of approximately $8.5 million, driven primarily by depreciation expense of $7.5 million on mining equipment (amortized over a two-year useful life), professional fees, stock-based compensation, and other operating expenses associated with building operational infrastructure during the Company’s first year of operations. The Company generated positive Adjusted EBITDA of approximately $0.6 million for the period.

Corporate Transaction. On December 15, 2025, the Company consummated the Transaction, issuing an aggregate of 13,835,188 shares of Common Stock and 16,239.812 shares of Series D Convertible Preferred Stock (convertible into 16,239,812 shares of Common Stock) to the stockholders of Doge. Following the Transaction, the Company changed its name to Datacentrex, Inc. and its shares continued to trade on the Nasdaq Capital Market under the ticker symbol “DTCX.”

Our results are primarily driven by realized revenue rates per unit of hashrate deployed, power costs and facility-level economics, fleet uptime and operational execution, hardware supply and replacement cycle dynamics, digital asset market conditions, and treasury and capital allocation decisions. For a further discussion of these key operating inputs, see Item 1, “Business — Key Operating Inputs” and the discussion of results of operations below.

RESULTS OF OPERATIONS

YEARS ENDED DECEMBER 31, 2025

The following table sets forth certain selected consolidated statements of operations data for the year ended December 31, 2025.

Revenues

The Company generated revenues of $6,963,477 for the years ended December 31, 2025. The Company was incorporated and commenced operations, specifically its digital mining operations in fiscal year 2025 and therefore had no activity in 2024. Cryptocurrency mining are impacted significantly by volatility in coin prices, as well as increases in the Blockchain’s Network Hash Rate resulting from the growth in the overall quantity and quality of rigs utilizing the Scrypt mining algorithm working to solve blocks on the blockchain and the difficulty index associated with the secure hashing algorithm employed in solving the blocks.

Summary of Mining Results

The following table presents additional information about our cryptocurrency mining activities in coins and amounts during the year ended December 31, 2025.

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Cost of Revenue

Cost of revenue for the year ended December 31, 2025 approximately $3.560 million consisted primarily of direct production costs of the mining operations, including utilities and fees paid to one of the Company’s colocation agreement hosts ($3.353 million) and value added tax expense ($206,000), but excluding depreciation and amortization, which are separately stated.

Operating expenses

For the year ended December 31, 2025 the Company incurred operating expenses of $11,332,284. Operating expenses consisted mainly of office expenses of $802,667, contract labor of $155,676, professional fees of $954,679, depreciation expense of $7,503,386 and stock based compensation of $1,389,989. Office expenses are primarily attributable to the Company moving colocation locations during the year and shipping mining equipment between locations. Contract labor and professional fees is related to operational activity for the company’s first year operations and the reverse recapitalization consummated during the year. Depreciation expense is attributable to in-service mining equipment which is amortized over two-year useful life. Stock based compensation is attributable to expense under the employee’s equity plan for eligible employees.

Net Loss from operations

The Company realized a net loss from operations before income taxes of $7,918,371 for the year ended December 31, 2025 which is attributed to the reasons stated above in the section “Operating Expenses.”

Other income (expense)

For the year ended December 31, 2025, the Company had ($584,514) in other income (expense). This included the net unrealized and realized loss on digital assets (cryptocurrencies) of ($443,696) during the year ended December 31, 2025 $(140,818) of net interest expense.

Net Loss Before Income Taxes

The Company realized a net loss before income taxes of $8,502,885 for the year ended December 31, 2025, and is due to the reasons stated above in the preceding sections.

Liquidity and capital resources

As of December 31, 2025, the Company had cash in the amount of $38,919,486. Of the cash held at December 31, 2025, $36,408,077 relates to Doge (the accounting acquirer) and $2,511,409 relating to Thumzup (the legal acquirer) and Thumzup Inc. which is excluded from the statement of cash flows as discussed in Note 2 of the consolidated financial statement. As of December 31, 2025, the Company had stockholders’ equity of $66,247,252.

The Company’s accumulated deficit was $(8,502,885) as of December 31, 2025.

The Company used net cash in operating activities of $6,447,474 for the year ended December 31, 2025. For the year ended December 31, 2025, cashflows were impacted by depreciation of $7,503,386, digital asset mining revenue of $6,963,477, stock based compensation of $1,389,989, net unrealized and realized loss on digital assets, $443,696, loss on sale of equipment $395, change in prepaid expense of $198,707, change in other assets of $621,660 and change in accrued expenses of $501,789.

Net cash used in investing activities for the year ended December 31, 2025 was $24,866,515. During the year ended December 31, 2025, we invested $25,938,181 in mining equipment, received $29,990 proceeds from sale of equipment, deposited $3,600,100 on mining equipment to be received and received $4,641,776 in proceeds from sale of digital assets.

There was cash generated by financing activities for the year ended December 31, 2025 of $70,233,475. For the year ended December 31, 2025, this was comprised of $8,550,000 in proceeds from long term debt, offset by repayments of $8,550,000, cash acquired in reverse recapitalization of $42,140,304, proceeds from the issuance Class A-1 units of $17,945,000, proceeds from the issuance of Class A-2 units net of issuance costs of $10,422,402, and the repurchase of treasury stock of $274,321.

Capital Resources

As of December 31, 2025, we had cash and cash equivalents on hand of $38,919,486. We currently have minimal sources of liquidity such as arrangements with credit institutions that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

Revenue from Mining Operations

Funding our operations on a go-forward basis will rely significantly on our ability to continue to mine cryptocurrency and the spot or market price of the cryptocurrency we mine and raise additional funds as equity, debt or convertible securities. We expect to generate ongoing revenues from the production of cryptocurrencies, primarily Dogecoin currency rewards, for example, in our mining facilities and our ability to liquidate for currency rewards at future values will be evaluated from time to time to generate cash for operations. Generating Dogecoin and other currency rewards, for example, which exceed our production and overhead costs will determine our ability to report profit margins related to such mining operations, although accounting for our reported profitability is significantly complex. Furthermore, regardless of our ability to generate revenue from the sale of our cryptocurrency assets, we may need to raise additional capital in the form of equity or debt to fund our operations and pursue our business strategy.

The ability to raise funds as equity, debt or conversion of cryptocurrency to maintain our operations is subject to many risks and uncertainties.

Contractual Obligations

The Company utilizes third-party data center facilities to support its digital asset mining operations. Specifically, the Company has entered into colocation and hosting services agreements with independent data center providers for the ongoing provision of rack space, electrical power capacity, network connectivity, and cooling infrastructure required to operate the Company’s mining hardware. For the year ended December 31, 2025, the Company incurred $3,353,355 of colocation and hosting-related service expenses, which are included in cost of revenues in the accompanying consolidated statements of operations.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we rely on Adjusted EBITDA to evaluate our business, measure our performance, and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure. We define Adjusted EBITDA as net income (loss), adjusted for impacts of interest expense, income tax provision or benefit and depreciation and amortization, and non-cash stock-based compensation. You are encouraged to evaluate each of these adjustments and the reasons our Board and management team consider them appropriate for supplemental analysis.

Our board of directors and management team use Adjusted EBITDA to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense and income), asset base (such as depreciation and amortization), and other items (such as non-recurring transactions mentioned above) that impact the comparability of financial results from period to period.

Net income (loss) is the GAAP measure most directly comparable to Adjusted EBITDA. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in such presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted EBITDA in the future, and any such modification may be material. Adjusted EBITDA has important limitations as an analytical tool and you should not consider Adjusted EBITDA in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA may be defined differently by other companies in our industry, our definition of this non-GAAP financial measure may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.

Reconciliations of Adjusted EBITDA to the most comparable U.S. GAAP financial metric as of December 31, 2025 is presented in the table below:

Inflation

The Company’s results of operations have not been affected by inflation and management cannot predict the impact, if any, inflation might have on its operations in the future.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer evaluated the effectiveness of Doge’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act and regulations promulgated thereunder) as of December 31, 2025. Based on this evaluation, our management concluded that our disclosure controls and procedures were effective as of December 31, 2025. Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the rules and forms of the SEC. Disclosure controls and procedures include, without limitation, controls, and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow for timely decisions regarding required disclosure.

Known Trends, Events and Uncertainties

The Company is subject to risks and uncertainties common to companies in the digital asset mining industry. The following discussion highlights trends, events, and uncertainties that management believes are reasonably likely to have a material effect on the Company’s financial condition, results of operations, or liquidity. For a more detailed discussion, see the section entitled “Risk Factors.”

Competition for Power and Infrastructure from AI and HPC Demand. The rapid growth in demand for data center capacity driven by artificial intelligence (“AI”) and high-performance computing (“HPC”) workloads has intensified competition for power infrastructure across the United States. Large-scale AI training and inference operations require reliable, high-density power at scale, and operators of these workloads have demonstrated willingness to pay power rates that exceed the economics available to digital asset miners under current market conditions. This trend is driving an industry-wide reassessment of the highest and best use of the electron, as power assets that were historically allocated to PoW mining are increasingly being evaluated for, or converted to, AI and HPC applications. We expect this dynamic to continue and potentially accelerate. As a colocation-based operator, the Company is exposed to rising competition for hosting capacity and power allocation, which could result in increased colocation costs, reduced availability of hosting at favorable rates, or pressure to relocate operations to lower-cost jurisdictions.

Tariff Uncertainty and ASIC Hardware Supply. The Company’s Scrypt ASIC mining hardware is manufactured primarily in China. During fiscal year 2025, evolving U.S. trade policy, including the imposition and adjustment of tariffs on Chinese-manufactured goods, materially impacted the Company’s deployment strategy. In the first quarter of 2025, the Company initially deployed its fleet at a colocation facility outside of the United States in part to mitigate tariff-related cost exposure. In the third quarter, following changes to the tariff environment, the Company relocated those miners to domestic facilities. The continued uncertainty surrounding U.S. tariff policy on ASIC mining hardware has disrupted supply chains across the industry, with many operators reducing or ceasing imports of rigs into the United States due to the adverse impact on equipment economics. Prolonged tariff uncertainty could constrain the Company’s ability to procure replacement or next-generation hardware on commercially favorable terms, increase capital expenditure requirements, and limit the Company’s ability to deploy rigs in jurisdictions with lower operating costs outside the United States.

Digital Asset Market Volatility and Network Difficulty. The Company’s revenues and the carrying value of its digital asset treasury are directly affected by the market prices of the digital assets it mines and holds, including Bitcoin, Dogecoin, and Litecoin. Digital asset prices have historically exhibited significant volatility and may be influenced by factors beyond the Company’s control, including macroeconomic conditions, investor sentiment, regulatory developments, technological changes, and the liquidity of digital asset markets. In addition, PoW mining economics are influenced by network difficulty, which adjusts dynamically based on total hashrate deployed across each respective blockchain. Increases in total network hashrate, whether driven by new entrants, fleet upgrades by existing miners, or changes in mining economics, increase mining difficulty and reduce expected rewards per unit of hashrate. During fiscal year 2025, the global Scrypt network hashrate experienced fluctuations that affected the Company’s per-unit mining economics. The Litecoin network is expected to undergo its next block reward halving event in August 2027, which would reduce the Litecoin block subsidy by 50% and may materially affect the mining economics of Scrypt-based operations.

Evolving Regulatory Environment. The regulatory environment for digital assets in the United States and globally continues to evolve. Legislative and regulatory actions at the federal and state level, including potential changes to the classification, taxation, or permissibility of digital asset mining, staking, or custody activities, could materially affect the Company’s operations and the broader market for digital assets. Changes in energy policy, environmental regulation, or reporting requirements applicable to data centers and PoW mining operations could also increase compliance costs or constrain operational flexibility. The Company monitors regulatory developments and engages with industry groups, but cannot predict the timing, scope, or impact of future regulatory actions.

Geopolitical and Macroeconomic Conditions. Ongoing geopolitical conflicts, including the conflicts between Russia and Ukraine and between Israel and Hamas, and broader macroeconomic uncertainty, including the effects of inflation, interest rate policy, and global trade tensions, may adversely affect digital asset markets, the cost and availability of capital, and the Company’s operating environment. Changes to U.S. policy implemented by the U.S. Congress or the executive branch, including policies affecting tariffs, international trade, taxation, and the regulatory environment, have impacted and may continue to impact the Company’s business and the broader economy in ways that are difficult to predict.

Off-Balance Sheet Arrangements

During the years presented, we did not have any off-balance sheet arrangements.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements. These financial statements are prepared in accordance with U.S. GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets, liabilities, revenues, and expenses, to disclose contingent assets and liabilities on the dates of the consolidated financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods. The most significant estimates and assumptions include, but are not limited to, the accounting for digital assets, revenue recognition, useful lives of equipment and the evaluation allowance related to deferred tax assets. We continue to evaluate these estimates and assumptions that we believe to be reasonable under the circumstances. We rely on these evaluations as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates as a result of changes in our estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe critical accounting policies as disclosed in this release reflect the more significant judgments and estimates used in preparation of our consolidated financial statements. For a summary of significant accounting policies, refer to Note 3. Summary of Significant Accounting Policies in our Notes to consolidated financial statements included elsewhere herein.

Other than as discussed above and elsewhere in this Annual Report on Form 10-K, we are not currently aware of any trends, events, or uncertainties that are reasonably likely to have a material effect on our financial condition. For a further discussion of factors that may affect future operating results, see the section entitled “Risk Factors.”

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Our management, including our Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2025. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, 2025, our disclosure controls and procedures were effective.

Management’s Annual Report on Internal Control over Financial Reporting

Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, based on the framework established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the assessment, management has determined that our internal control over financial reporting as of December 31, 2025 was effective.

Changes in Internal Control Over Financial Reporting

Other than as described above, there have been no changes in our internal control over financial reporting that occurred during our last fiscal quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations of Internal Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. 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 the 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 control. The design of any system of controls is also 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.