XML 38 R17.htm IDEA: XBRL DOCUMENT
v3.25.3

Fair Value Measurement | 3 Months Ended | 9 Months Ended
--- | --- | ---
Dec. 31, 2024 | Sep. 30, 2025
Fair Value Measurement [Abstract] |  |
FAIR VALUE MEASUREMENT | NOTE 12 – FAIR VALUE MEASUREMENT Customer digital currency assets and liabilities represent the Company’s obligation to safeguard customer digital currencies. Accordingly, the Company has valued the assets and liabilities using quoted market prices for the underlying digital currencies which is based on Level 2 inputs. The Black-Scholes option pricing model is used to estimate fair value of liability-classified stock purchase warrants issued in connection with convertible notes (see Note 9) and the liability-classified pre-funded stock purchase warrants issued in connection with the December 2024 Private Placement (see Note 10). A Monte Carlo simulation model is used to estimate the fair value of liability-classified stock purchase warrants issued in connection with the December 2024 Private Placement (see Note 10). Both models utilize the following assumptions:
| ● | Risk-free interest rates are derived from the yield on U.S. Treasury debt securities in effect on the date of measurement.
| ● | Dividend yields are based on our historical dividend payments, which have been zero to date.
| ● | Volatility is estimated from historical volatility of a peer group over a similar period.
| ● | The expected term is based on the time to expiration of the warrants from the date of measurement.
The Monte Carlo simulation model also incorporates management’s judgments for the occurrence or non-occurrence of certain events as well as the probability of certain scenarios impactful to the valuation of the liability-classified stock purchase warrants issued in connection with the December 2024 Private Placement. The assumptions used for the Black-Scholes option pricing model for liability-classified stock purchase warrants are as follows:
June 2024 Warrants |  | December 31, 2024 |  |  | November 2024 Modification |
Expected term (years) |  |  | 4.4 years |  |  |  | 4.6 years |
Risk-free interest rate |  |  | 4.4 | % |  |  | 4.4 | %
Expected volatility |  |  | 114.2 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
November 2024 Warrants |  | December 31, 2024 |  |  | November 2024 Issuance |
Expected term (years) |  |  | 4.9 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 4.2 | % |  |  | 4.2 | %
Expected volatility |  |  | 114.2 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
Pre-funded Warrants |  | December 31, 2024 |  |  | December 2024 Issuance |
Expected term (years) |  |  | 5.0 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 4.3 | % |  |  | 4.3 | %
Expected volatility |  |  | 114.2 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
The assumptions used for the Monte Carlo simulation model for liability-classified stock purchase warrants and the embedded derivative liability issued in connection with a convertible note are as follows:
December 2024 Warrants |  | December 31, 2024 |  |  | December 2024 Issuance |
Expected term (years) |  |  | 5.0 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 4.3 | % |  |  | 4.3 | %
Expected volatility |  |  | 114.2 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
Probability of a fundamental event |  |  | 10.0 | % |  |  | 10.0 | %
Embedded Derivative Liability |  | December 31, 2024 |  |  | December 2024 Issuance |
Expected term (years) |  |  | 0.9 years |  |  |  | 1.0 years |
Risk-free interest rate |  |  | 4.2 | % |  |  | 4.3 | %
Expected volatility |  |  | 156.2 | % |  |  | 157.5 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
Conversion discount |  |  | 10.0 | % |  |  | 10.0 | %
Interest rate |  |  | 10.0 | % |  |  | 10.0 | %
Redemption premium |  | $ | 50,000 |  |  | $ | 50,000 |
The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis as of December 31, 2024:
|  | Quoted Price in Active Markets |  |  | Significant Other Observable Inputs |  |  | Significant Unobservable Inputs |  |  | Balance at December 31, |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | 2024 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
June 2024 Warrant |  |  | — |  |  |  | — |  |  |  | 5,333,794 |  |  |  | 5,333,794 |
November 2024 Warrant |  |  | — |  |  |  | — |  |  |  | 12,467,515 |  |  |  | 12,467,515 |
Pre-funded warrant liabilities |  |  | — |  |  |  | — |  |  |  | 52,682,426 |  |  |  | 52,682,426 |
Private Placement Warrants |  |  | — |  |  |  | — |  |  |  | 94,286,790 |  |  |  | 94,286,790 |
Embedded derivative liability |  |  | — |  |  |  | — |  |  |  | 847,753 |  |  |  | 847,753 |
Total liabilities |  | $ | — |  |  | $ | — |  |  | $ | 165,618,278 |  |  | $ | 165,618,278 |
The Company did not make any transfers into or out of Level 3 of the fair value hierarchy during the three months ended December 31, 2024. The Company had no assets or liabilities measured and recorded at fair value on a recurring basis as of September 30, 2024 and 2023. The following table provides a reconciliation of the warrants measured at fair value using Level 3 inputs:
|  | Embedded Derivative Liability |  |  | June 2024 Warrant |  |  | November 2024 Warrant |  |  | Pre-funded Warrant |  |  | Common Stock Warrant |
Balance at October 1, 2024 |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Additions |  |  | 222,865 |  |  |  | 283,293 |  |  |  | 663,408 |  |  |  | 5,085,682 |  |  |  | 18,153,362 |
Change in fair value |  |  | 624,888 |  |  |  | 5,050,501 |  |  |  | 11,804,107 |  |  |  | 47,596,744 |  |  |  | 76,133,428 |
Ending balance, December 31, 2024 |  | $ | 847,753 |  |  | $ | 5,333,794 |  |  | $ | 12,467,515 |  |  | $ | 52,682,426 |  |  | $ | 94,286,790 |
| NOTE 11 – FAIR VALUE MEASUREMENT Customer digital currency assets and liabilities represent the Company’s obligation to safeguard customer digital currencies. Accordingly, the Company has valued the assets and liabilities using quoted market prices for the underlying digital currencies which is based on Level 2 inputs. The Black-Scholes option pricing model is used to estimate fair value of liability-classified stock purchase warrants issued in connection with convertible notes (see Note 8) and the liability-classified pre-funded stock purchase warrants issued in connection with the December 2024 Private Placement (see Note 9). A Monte Carlo simulation model is used to estimate the fair value of liability-classified stock purchase warrants issued in connection with the December 2024 Private Placement and the September 2025 Private Placement (see Note 9). Both models utilize the following assumptions:
| ● | Risk-free interest rates are derived from the yield on U.S. Treasury debt securities in effect on the date of measurement.
| ● | Dividend yields are based on our historical dividend payments, which have been zero to date.
| ● | Volatility is estimated from historical volatility of a peer group over a similar period.
| ● | The expected term is based on the time to expiration of the warrants from the date of measurement.
The Monte Carlo simulation model also incorporates management’s judgments for the occurrence or non-occurrence of certain events as well as the probability of certain scenarios impactful to the valuation of the liability-classified stock purchase warrants issued in connection with the December 2024 Private Placement and the September 2025 Private Placement. The assumptions used for the Black-Scholes option pricing model for liability-classified stock purchase warrants are as follows:
June 2024 Warrants |  | September 30, 2025 |  |  | November 2024 Modification |
Expected term (years) |  |  | 3.7 years |  |  |  | 4.6 years |
Risk-free interest rate |  |  | 3.74 | % |  |  | 4.4 | %
Expected volatility |  |  | 110.0 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
November 2024 Warrants |  | September 30, 2025 |  |  | November 2024 Issuance |
Expected term (years) |  |  | 4.1 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 3.74 | % |  |  | 4.2 | %
Expected volatility |  |  | 110.0 | % |  |  | 113.8 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
The assumptions used for the Monte Carlo simulation model for liability-classified stock purchase warrants are as follows:
August 2025 Warrants |  | September 30, 2025 |  |  | August 2025 Issuance |
Expected term (years) |  |  | 4.9 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 3.73 | % |  |  | 3.65 | %
Expected volatility |  |  | 108.3 | % |  |  | 110.1 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
Probability of a fundamental event |  |  | 10.0 | % |  |  | 10.0 | %
September 2025 Private Placement Warrants |  | September 30, 2025 |  |  | September 2025 Issuance |
Expected term (years) |  |  | 4.9 years |  |  |  | 5.0 years |
Risk-free interest rate |  |  | 3.74 | % |  |  | 3.65 | %
Expected volatility |  |  | 158.4 | % |  |  | 156.9 | %
Expected dividend yield |  |  | 0.0 | % |  |  | 0.0 | %
Probability of a fundamental event |  |  | 10.0 | % |  |  | 10.0 | %
The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis as of September 30, 2025:
|  | Quoted Price in Active Markets |  |  | Significant Other Observable Inputs |  |  | Significant Unobservable Inputs |  |  | Balance at September 30, |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | 2025 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
June 2024 Warrant |  |  | — |  |  |  | — |  |  |  | 914,583 |  |  |  | 914,583 |
November 2024 Warrant |  |  | — |  |  |  | — |  |  |  | 2,133,949 |  |  |  | 2,133,949 |
August 2025 Warrant |  |  | — |  |  |  | — |  |  |  | 2,210,729 |  |  |  | 2,210,729 |
Private Placement Warrants |  |  | — |  |  |  | — |  |  |  | 35,480,932 |  |  |  | 35,480,932 |
Embedded derivative liability |  |  | — |  |  |  | — |  |  |  | - |  |  |  | - |
Total liabilities |  | $ | — |  |  | $ | — |  |  | $ | 40,740,193 |  |  | $ | 40,740,193 |
The Company did not make any transfers into or out of Level 3 of the fair value hierarchy during the nine months ended September 30, 2025. The following table provides a reconciliation of the warrants measured at fair value using Level 3 inputs:
|  | Embedded Derivative |  |  | June 2024 |  |  | November 2024 |  |  | Pre-funded |  |  | Common Stock |  |  | August 2025 |  |  | September 2025 |
|  | Liability |  |  | Warrant |  |  | Warrant |  |  | Warrant |  |  | Warrant |  |  | Warrant |  |  | Warrant |
Balance at January 1, 2025 |  | $ | 847,753 |  |  | $ | 5,333,794 |  |  | $ | 12,467,515 |  |  | $ | 52,682,426 |  |  | $ | 94,286,790 |  |  | $ | - |  |  | $ | - |
Additions |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,672,686 |  |  |  | 29,605,956 |
Subtractions |  |  | (259,963 | ) |  |  | - |  |  |  | - |  |  |  | (12,421,864 | ) |  |  | (19,517,415 | ) |  |  | - |  |  |  | - |
Change in fair value |  |  | (587,790 | ) |  |  | (4,419,211 | ) |  |  | (10,333,566 | ) |  |  | (40,260,562 | ) |  |  | (74,769,375 | ) |  |  | 538,043 |  |  |  | 5,874,976 |
Ending balance, September 30, 2025 |  | $ | - |  |  | $ | 914,583 |  |  | $ | 2,133,949 |  |  | $ | - |  |  | $ | - |  |  | $ | 2,210,729 |  |  | $ | 35,480,932 |

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration