v3.26.1
DERIVATIVE LIABILITIES
3 Months Ended
Mar. 31, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE LIABILITIES

8. DERIVATIVE LIABILITIES

 

The Company has various convertible notes outstanding that requires derivative liability considerations for its conversion features.

 

The following table summarizes the changes in derivative liability:

 

Description  March 31, 2026   December 31, 2025 
Derivative Liability beginning balance  $1,828,934   $40,941 
Initial recognition of derivatives   1,163,259    2,214,428 
Change in fair value   1,566,067    (385,493)
Settlements/conversions   (512,593)   (40,942)
Derivative Liability ending balance  $

4,045,667

   $1,828,934 

 

 

During the three months ended March 31, 2026, the Company recognized a loss of $1,566,067 from increase in the fair value of its derivative liabilities, a loss of $597,259 from initial recognition of derivatives and gain of $ 512,593 on settlement of derivative liabilities. These losses are included in the consolidated statement of operations.

 

Derivative liability is recognized as a present obligation determined using valuation techniques that rely on market-based or model-based assumptions, and may not require settlement in the form of cash or transfer of assets. Its actual settlement amount and timing are variable and contingent on underlying factors. The following table summarizes the weighted average key inputs used in the Black-Scholes model for all outstanding conversion feature derivative liabilities as of the measurement dates:

 

Input 

March 31, 2026

  

December 31, 2025

 
Stock price  $0.030   $0.046 
Exercise price (conversion price)  $0.0066 to $0.04   $0.0174 to 1.00 
Risk-free interest rate   3.68%   3.48%
Expected term (years)   0.28 to 4.641    0.29 to 4.89 
Expected volatility   190.91% to 271.79%   174.89% to 216.66%
Dividend yield   0%   0%