Derivative Liability |
6 Months Ended | ||
|---|---|---|---|
Jun. 30, 2025 | |||
| Derivative Liability [Abstract] | |||
| Derivative Liability |
On December 20, 2024, the Company announced that it had entered into a definitive agreement (the “Transaction Agreement”) for a strategic investment of $775 million (the “Transaction”) from Tether Investments Limited (n/k/a Tether Investments S.A. de C.V.) (“Tether”) in exchange for 103,333,333 shares of Class A Common Stock. The Class A Common Stock has a par value of $0.0001 per share. The purchase price of the Class A Common Stock in the Transaction was $7.50 per share.
In connection with the Transaction Agreement, the Company executed support agreements with certain members of key management to provide a backstop to the anticipated tender offer and ensure 70,000,000 shares would be tendered and available for repurchase when the Transaction closed.
On January 3, 2025, the Company commenced a tender offer to purchase up to 70,000,000 shares of the Company’s Class A Common Stock using proceeds from the Transaction.
The Company accounted for the Transaction and support agreements as one unit of account, which met the definition of a derivative.
On February 7, 2025, the Transaction closed, which resulted in the Company settling the derivative by issuing 103,333,333 shares to Tether in exchange for $775,000,000 in cash proceeds and repurchasing 70,000,000 shares from existing shareholders for $525,000,000 in cash. The net proceeds of $250,000,000, together with the fair value of the derivative on that date of $174,999,998, were recorded in additional paid-in capital, net of transaction costs of $29,429,791. The Company recognized a gain on fair value of the derivative of $ and $9,700,000 during the three and six months ended June 30, 2025. |