NOTE 12             DERIVATIVES

During the three and nine months ended June 30, 2026, the Company entered into OTC European-style option contracts referencing the price of SOL. Under these contracts, the Company purchased and sold call and put options and received or paid upfront premiums at inception. The options resulted in the Company obtaining the right to purchase or the obligation to sell a specified quantity of SOL at a fixed strike price on the contract expiration date. The contracts are governed by an ISDA Master Agreement and related Credit Support Annex, which requires the Company to post collateral to secure its obligations.

The Company recognized a net derivative loss of $4,561,000 and $4,292,000, respectively, during the three and nine months ended June 30, 2026, related to SOL option contracts, which is presented as derivative loss, net on the condensed consolidated statement of operations.

The details of the Company’s open derivative positions at June 30, 2026 were as follows:

Galaxy Trading Mercury LLC, a related party (see Note 9), was the counterparty to option contracts representing $75,534,000 of notional amount on open positions, $4,926,000 of derivative assets and $7,344,000 of derivative liabilities at June 30, 2026, and $4,281,000 and $4,012,000 of the net derivative loss for the three and nine months ended June 30, 2026, respectively. The remaining contracts were entered into with unrelated third-party counterparties. Information regarding the fair value hierarchy classification and valuation of derivative instruments is provided in Note 2.