Digital Assets

6 Months Ended

Jun. 30, 2026

Note 6 – Digital Assets

Native Staking

As of June 30, 2026, the Company had native staked 634,379 HYPE to the KxH validator node. In the three and six months ended June 30, 2026, the Company recognized revenue of $314,116 and $512,467, respectively, from its staking activities which generated 6,166 and 12,593 HYPE tokens, respectively, recognized at fair value.

Temporary HYPE Asset Use Service Agreements

For the three and six months ended June 30, 2026, the Company recognized revenue of $9,586 and $55,507, respectively, from temporary HAUS agreements in the form of cash, cash equivalents, USDC stablecoin and USDH stablecoin. USDC and USDH stablecoin are presented within “Prepaid expenses and other current assets” in the condensed balance sheets; the Company does not hold any USDH stablecoin as of June 30, 2026.

Digital Assets Receivable, Digital Intangible Assets Receivable, and Credit Loss Allowance

For three and six months ended June 30, 2026, the Company recognized interest income of $147,098 and $346,055, respectively, presented within “Other income (expense)” in the condensed statements of operations, in connection with its digital assets receivable, which includes the amortization of a nonrefundable upfront fee received in connection with digital assets receivable. On June 3, 2026, all outstanding digital assets receivable were returned to the Company, and the Company does not have any allowance for credit losses for digital assets receivable as of June 30, 2026. In the three and six months ended June 30, 2026, the Company recorded a recapture of credit losses of $586,774 and $405,331, respectively, from the release of all allowance for credit losses related to its digital assets receivable.

As of June 30, 2026, the Company does not have any OTC HYPE options or digital intangible assets receivable outstanding. In the three months ended June 30, 2026, the Company recorded a recapture of credit losses of $323,068 from the release of all allowance for credit losses related to its digital intangible assets receivable.

There were no credit losses recognized during the six months ended June 30, 2026.

OTC HYPE Options

In the three and six months ended June 30, 2026, the Company’s net gains on derivative instruments totaled $0.1 million and $0.2 million, respectively. As of June 30, 2026, there were no outstanding OTC HYPE options.

Hyperion Rysk Vault Shares

In the three months ended March 31, 2026, the Company deposited $1,765,075 USDH in exchange for 1,765,075 notional Hyperion Rysk Vault Shares, presented within digital intangible assets on the condensed balance sheets, initially valued at the Company’s basis of $1,765,075 (in USDH) with no realized gains or losses. During the three months ended June 30, 2026, all of the Company’s Hyperion Rysk Vault Shares with a USDH liquidity pool (such shares bearing the technical name “WHYPE-USDH-USDH-P-H-HL”) were redeemed for USDH and subsequently converted to USDC. In addition, all of the Company’s Hyperion Rysk Vault Shares with a USDC liquidity pool were redeemed for USDC in the three months ended June 30, 2026. There were no outstanding options transactions within the IVIV as of June 30, 2026.

Digital Asset Reconciliation

The following table presents changes in the components of the Company’s digital assets from December 31, 2025 to June 30, 2026:


					Digital			Digital			Digital			Total
		Digital			Assets			Intangible			Intangible Assets			Digital
		Assets			Receivable			Assets			Receivable			Assets
Balance, December 31, 2025		$	16,345,347		$	6,935,131		$	20,591,555		$	—		$	43,872,033
Receipt of HPL pursuant to partnership agreement			150,163			—						—			150,163
HYPE Purchases			12,585,507			—						—			12,585,507
Sales and dispositions of digital assets			(2,874,699)			—			—			(2,440,000)			(5,314,699)
Deposits into Hyperion Rysk Vault			—			—			1,812,029			—			1,812,029
Redemptions from Hyperion Rysk Vault			—			—			(1,854,834)			—			(1,854,834)
Deposits of digital assets into liquid staking activities			(364,962)			—			364,962			—			—
Net HYPE received from native staking activities ⁽¹⁾			526,144			91,772			—			—			617,916
HYPE commission paid to co-validators			(136,284)			—			—			—			(136,284)
Exchange of digital intangible assets for digital intangible assets receivable			—			—			(18,746,744)			18,746,744			—
Exchange of digital intangible assets receivable for digital intangible assets			—			—			19,454,154			(19,454,154)			—
Settlement of digital assets receivable			22,528,501			(22,528,501)			—			—			—
Non-cash interest income from digital assets receivable			—			307,278			—			—			307,278
Realized and unrealized gains ⁽²⁾			25,653,083			14,788,989			6,108,349			3,147,410			49,697,831
Realized and unrealized losses⁽³⁾			(293,569)			—			(7,380)			—			(300,949)
Impairment			—			—			(2,000,525)			—			(2,000,525)
Recovery of credit loss			—			405,331			—			—			405,331
Balance, June 30, 2026		$	74,119,231		$	—		$	25,721,566		$	—		$	99,840,797

(1)

Represents $601,964 of net Company revenues, less: (i) $55,506 of revenues receivable included in prepaid expenses and other current assets on the accompanying condensed balance sheet as of June 30, 2026; (ii) $42,223 of net costs previously accrued, and (iii) of $22,603 of HYPE receipts included in other income on the accompanying statement of operations for the six months ended June 30, 2026, plus $136,284 of HYPE commissions presented separately in this table

(2)	Includes $21,782,760 and $27,915,071 of realized and unrealized gains, respectively.

(3)	Includes $299,491 and $1,458 of realized and unrealized losses, respectively, which are netted against the related gains on the accompanying statements of operations.

Digital Assets

The following table sets forth the units, cost basis and fair value of digital assets held, as shown on the condensed balance sheet as of June 30, 2026:


		Units		Cost Basis			Fair Value
HYPE digital assets		1,141,174		$	55,250,524		$	74,119,231
Total				$	55,250,524		$	74,119,231

Digital Intangible Assets

The Company tracks the cost of its LSTs and digital intangible assets on a token by token basis. Impairment losses for the Company’s LSTs are recognized when the carrying value falls below its fair value. The fair value of LSTs are estimated based on the original digital asset token deposited minus transaction costs, without the inclusion of any accrued but unrealized staking rewards. For the three and six months ended June 30, 2026, the Company reported an impairment loss of $0.8 million and $2.0 million, respectively, on the condensed statements of operations under “Impairment loss – digital intangible assets”.

The following table sets forth the units, cost basis, and carrying amount of digital intangible assets held, as shown on the condensed balance sheets as of June 30, 2026:


		Units		Cost			Carrying Value
HiHYPE		398,277		$	18,902,486		$	8,828,972
kHYPE		455,434			18,591,852			15,897,330
kmHYPE		28,888			884,473			597,068
sKNTQ		1,918,479			208,355			172,196
sHPL		10,000,000			156,611			91,000
Other digital intangible assets		2			135,000			135,000
Total				$	38,878,777		$	25,721,566