Note 7. Derivatives

The warrant information presented below reflects the Reverse Stock Split effected on July 2, 2026. In connection with the Reverse Stock Split, proportionate adjustments were made to the number of shares of the Company’s Class A common stock purchasable upon exercise of outstanding warrants and, for certain of the Company’s outstanding warrants, their exercise price per share, in each case in accordance with the terms of the relevant warrant agreement. See Note 2. Significant accounting policies and recent accounting pronouncements for further information on the reverse stock split.

Bitcoin redemption and put options

During December 2024, pursuant to the Hut 8 Bitmain Purchase Agreement, Hut 8 pledged approximately 968 Bitcoin attributed to the Company at the time to Bitmain in connection with a purchase of approximately 30,000 Bitmain Antminer S21+ ASIC miners. Under the arrangement, Hut 8 had the option to redeem the pledged Bitcoin at a mutually agreed upon fixed price, during a redemption period that started on the shipment date of the purchased ASIC miners and originally ended three months thereafter. The amount of Bitcoin that could be redeemed was pro-rata of the percentage of miners shipped on a compute power (hashrate) basis. The Company accounted

for this Bitcoin redemption option as a Level 3 derivative asset as of December 31, 2024, due to a significant unobservable input included in the fair value estimate of the Bitcoin redemption option, which was the estimated shipment date of the purchased ASIC miners. After the Transactions were effectuated on March 31, 2025, the Company no longer recorded the Bitcoin pledged by Hut 8.

As part of the 2025 Bitmain Purchase Agreement, in August, September, and October 2025, the Company pledged Bitcoin with Bitmain in connection with a purchase of approximately 17,280 U3S21EXPH ASIC miners. The total amount of Bitcoin pledged was approximately 2,776 Bitcoin. The Company pledged the Bitcoin in four tranches, two tranches in August 2025, one tranche in September 2025, and one tranche in October 2025. The Company has the option to redeem the pledged Bitcoin at a mutually agreed upon price starting from and for up to twenty-four months after the day immediately following each pledge date. The Company accounted for this Bitcoin redemption option as a Level 2 derivative asset as noted in Note 2. Significant accounting policies and recent accounting pronouncements – Derivatives of the Notes to the Combined Financial Statements for the year ended December 31, 2025. As part of the purchase of the U3S21EXPH ASIC miners, Hut 8 paid cash of approximately $46.0 million as a deposit and for certain expenses attributable to the Company. The Company had an option to replace the $46.0 million cash paid with a Bitcoin pledge on or before November 5, 2025. In October 2025, the Company exercised its option to replace the $46.0 million cash paid with a Bitcoin pledge by pledging an additional 391 Bitcoin at a mutually agreed upon fixed price, and Bitmain refunded the Company's $46.0 million comprising of the deposit and certain expenses attributable to Hut 8.

In February 2026, in connection with the 2026 Bitmain Purchase Agreement, the Company pledged approximately 314 Bitcoin with Bitmain, representing 80% of the purchase price of approximately 11,298 S21 XP ASIC miners. The Company has the option to redeem the pledged Bitcoin at a mutually agreed upon price starting from and for up to twenty-four months after the day immediately following the pledge date. As part of the agreement, the Company has an option to extend the pledge period for an additional twelve months. The Company also has the option to pay the remaining 20% of the purchase price under the 2026 Bitmain Purchase Agreement by pledging Bitcoin at a mutually agreed upon floor price, which is due one year after the shipment date of the S21 XP ASIC miners. The Company accounted for this Bitcoin redemption and put option as a Level 2 derivative asset as noted in Note 2. Significant accounting policies and recent accounting pronouncements – Derivatives of the Notes to the Combined Financial Statements for the year ended December 31, 2025.

Covered call options

During October 2024, Hut 8 sold covered call options on 2,000 Bitcoin notional, which was attributed to the Company at the time, for proceeds of $2.9 million to generate cash flow on a portion of its digital assets. During November 2024, Hut 8 rolled these call options into new call options with the same Bitcoin notional. Hut 8 achieved this roll by exchanging its previous call options sold for new call options. Hut 8 pledged the Bitcoin attributed to the Company as collateral with one of its Bitcoin custodians in a quantity equal to the notional amount for these covered call options sold. The collateral continued to be pledged in the same manner after the roll. Following the effectiveness of the Transactions, Hut 8 retained the pledged Bitcoin and the covered call options. The covered call options exchanged in the roll were only exercisable upon the date of expiry, automatically exercised if the underlying reference price was greater than the strike price of the call option, and settled with delivery of the underlying Bitcoin. The reference price of the original covered call options was the CME CF Bitcoin Reference Rate at 4:00pm London time for a given date and the reference price for the new call options was the Coinbase Prime Bitcoin price quoted in U.S. Dollars at 4:00pm London time for a given date. The covered call options were carried at fair value and were Level 2 liabilities as noted in Note 2. Significant accounting policies and recent accounting pronouncements – Derivatives of the Notes to the Combined Financial Statements for the year ended December 31, 2025.

During the six months ended June 30, 2025, (1) covered call options on 1,500 Bitcoin notional expired with the underlying reference price below their strike prices, and the Company recorded a gain of $12.1 million; (2) the Company rolled a covered call option on 500 Bitcoin notional for a covered call option on the same Bitcoin notional by exchanging its previously outstanding call option for a new call option, and as a result of the roll, received $0.8 million in cash and recorded a gain of $4.2 million; and (3) the Company recorded an unrealized gain of $1.1 million related to changes in the fair value of outstanding covered call options. As of June 30, 2026, the Company had no outstanding covered call options.

Warrant liability

In connection with the Mergers, the Company assumed 91,551 warrants to purchase Gryphon common stock (the "Gryphon Warrants") outstanding immediately before the Mergers. Following the completion of the Mergers, the warrant holders are entitled to receive, upon exercise, in lieu of Gryphon common stock, shares of Class A common stock of the Company. The Gryphon Warrants have an exercise price of $1.50 per share, after giving effect of the Mergers. These warrants expire in January 2035. Pursuant to the terms of the Gryphon Warrants agreement, the exercise price of the outstanding Gryphon Warrants was not adjusted in connection with the Reverse Stock Split.

As of June 30, 2026, there were 5,947 Gryphon Warrants outstanding.

These warrants meet the definition of a derivative under ASC 815, and due to the terms of the warrants, are required to be liability classified. The warrant liabilities are carried at fair value, and are Level 3 liabilities as noted in Note 2. Significant accounting policies and recent accounting pronouncements of the Notes to the Combined Financial Statements for the year ended December 31, 2025.