Use of Estimates - The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for credit losses, useful lives of property and equipment, impairment of long-lived assets, inventory valuation, fair value of stock-based compensation, fair value of digital assets, fair value of the Phantom Stock Unit compensation, and valuation allowance on deferred tax assets.

Accounts Receivable - Accounts receivable are uncollateralized customer obligations due under normal trade terms requiring payment within a specified time from the invoice date. The trade terms vary based on the customer and typically range from prepaid to 45 days from the invoice date. Interest is not charged by the Company on past due accounts. The carrying amount of receivables is reduced by an allowance for expected credit losses, as necessary, that reflects management’s best estimate of the amount that will not be collected. This estimation takes into consideration historical experience, current conditions and, as applicable, reasonable and supportable forecasts. Actual results could vary from the estimate. Accounts are charged against the allowance when management deems them to be uncollectible. The net accounts receivable balances were $75,209, $97,244, and $157,515 at September 30, 2026, June 30, 2026, and June 30, 2025, respectively. Based on management’s review of accounts receivable, the allowance for credit losses was approximately $59,794 and $29,341 at September 30, 2026 and June 30, 2026, respectively. The Company recognized credit loss expense of $30,453 and $229 for the three months ended September 30, 2026 and 2025, respectively. 

Digital Assets - Pursuant to Accounting Standards Update (“ASU”) 2023-08, Intangibles — Goodwill and Other — Crypto Assets: Accounting for and Disclosure of Crypto Assets, codified into Accounting Standards Codification (“ASC”) subtopic 350-60, in-scope crypto assets are required to be measured at fair value in the statement of financial position, with gains and losses from changes in the fair value of such crypto assets recognized in net income each reporting period. ASU 2023-08 also requires certain interim and annual disclosures for crypto assets within the scope of the standard.

The Company measures its liquid SOL holdings at fair value in accordance with ASC 820, Fair Value Measurement, using unadjusted quoted prices in an active market for identical assets that the Company can access at the measurement date. The Company evaluates the principal market for SOL based on the market with the greatest volume and level of activity that is accessible to the Company. Accordingly, the Company classifies the fair value measurement of its liquid SOL holdings within Level 1 of the fair value hierarchy. CoinMarketCap is used as a market-data provider to monitor and corroborate pricing information; it is not considered a principal market or trading venue.

Goodwill - The Company evaluates its goodwill for possible impairment at least annually and when one or more triggering events or circumstances indicate that the goodwill might be impaired. Under this guidance, annual or interim goodwill impairment testing is performed by comparing the estimated fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the carrying value of goodwill.

The Company performed its annual test as of June 30, 2026 and 2025. As of September 30, 2026 and June 30, 2026, the amount in goodwill was $673,854.

Revenue Recognition - In accordance with ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when we satisfy performance obligations as evidenced by the transfer of control of our products or services to customers. In general, the Company generates revenue from product sales, either directly to customers or to distributors. In determining whether a contract exists, we evaluate the terms of the agreement, the relationship with the customer or distributor and their ability to pay.

The Company recognizes revenue from sales of our products, including sales to our distributors, at a point in time, generally upon shipment or delivery to the customer or distributor, depending upon the terms of the sales order. Control is considered transferred when title and risk of loss pass, when the customer becomes obligated to pay and, where applicable, when the customer has accepted the products or upon expiration of the acceptance period. For sales to distributors, payment is due on our standard commercial terms and is not contingent upon the distributors’ resale of the products.

Shipping and handling fees billed to customers are included in revenue. Shipping and handling fees associated with inbound freight are generally included in cost of revenue.

Our business is subject to contingencies related to customer orders, including:

Right of Return

A large portion of our revenue comes from the sale of consumable products, which are sold in high-volume and low quantities, and are generally maintained at stock levels of less than ninety days in our facility. Customer returns have historically represented a very small percentage of sales on an annual basis. Other product sales relate to some pet products, including small mechanical devices.

Conditions of Acceptance

Sales of our consumable products and pet products generally do not have customer acceptance terms.

Revenue by Geography and Product Source

The following table, which excludes digital asset revenue, discloses disaggregated revenue:

Acquisition of Solana tokens

We acquire liquid Solana tokens through purchases. In the case of liquid bulk purchases, we recognize the cost basis as the actual price paid. In the case of liquid VWAP (volume-weighted average price) or TWAP (time-weighted average price) over multiple hours or days, we recognize the cost basis as the average price paid for all tokens purchased.

The Company is able to acquire Solana tokens that are locked through direct negotiations with the owner or a third party at a discounted price from the Solana market value price. These locked tokens will unlock over a period of time and once unlocked can be sold on several Solana exchanges. With the purchase of locked Solana, we recognize the cost basis as the actual price paid. The Company purchases locked SOL on the open market at negotiated discounts to the prevailing spot price. The original purchase discount is calculated in SOL tokens and amortized over the unlocking period. The dollar value of the unamortized discount is determined using the SOL spot price at each reporting date. The unlocking of the purchased Solana occurs over a series of dates as prescribed by the purchase agreement. At the time of unlocking, tokens can remain in the original wallet or be transferred into the wallet at our custodian or sold on an open exchange. Once the Solana is unlocked, the fair value is measured at the end of the period at the market value without a discount.

Remeasurement on a recurring basis

Subsequent to the acquisitions of Solana tokens, remeasurement of change in fair value is done by taking the spot price from CoinMarketCap at the end of a month. Our tokens are bifurcated between liquid and locked tokens. In the case of liquid tokens, the aggregate fair value is computed by taking the number of liquid tokens and multiplying that number by the month-end spot price. The Company purchases locked SOL on the open market at negotiated discounts to the prevailing spot price. The original purchase discount is calculated in SOL tokens and amortized over the unlocking period. The dollar value of the unamortized discount is determined using the SOL spot price at each reporting date. As locked tokens become unlocked over time, they will be added to the count of liquid tokens and accordingly, make up less of that discount percentage over time when computing aggregate fair value on locked tokens. The discount used by management is based on the historical purchases of locked Solana management has made on behalf of the Company. Management monitors this discount percentage and adjusts when appropriate.

Per ASC 350-60-45-2, gains and losses from the remeasurement of crypto assets shall be included in net income and presented separately from changes in the carrying value of other intangible assets. Pursuant to this guidance, changes in fair value are reflected on the Condensed Consolidated Statements of Operations. The fair value of the Company's digital assets is measured at each reporting date as the quantity of tokens held multiplied by the quoted price of SOL in its principal market at that date, adjusted for the effect of contractual transfer restrictions on locked tokens. The amount of gains and losses recognized for the period is the difference between that fair value and the carrying amount of the digital assets at the end of the immediately preceding reporting period, or their cost basis for digital assets acquired during the period.

Staking revenue

We earn staking rewards by delegating our digital assets to third-party validators on proof-of-stake blockchain networks. These tokens remain under the Company’s control and are not derecognized, as the delegation does not constitute a transfer of control under ASC 610-20 or ASC 350-60. Rewards are recognized as income when the Company obtains control of the new tokens, typically upon receipt into its wallet. While there is no explicit guidance under GAAP for staking activities, the Company applies the principles of ASC 606, Revenue from Contracts with Customers, by analogy. Management evaluates whether a contract exists, identifies the performance obligations, and determines whether the Company acts as a principal or agent in the transaction. The transaction price is measured at the fair value of the digital assets received at the time control is obtained. Due to the evolving nature of blockchain protocols and limited regulatory guidance, management exercises significant judgment in evaluating validator reliability and the risk of slashing or forfeiture. Changes in protocol rules or accounting interpretations may materially impact how staking revenue is recognized and measured. Solana tokens held by the Company, whether liquid or locked, are eligible for staking. Staking revenue is calculated based on the number of tokens earned and the month-end spot price. This revenue is reported on the Condensed Consolidated Statements of Operations under the line item Digital asset revenue. Changes in the fair value of staking rewards after initial recognition are presented within operating expenses in the Condensed Consolidated Statements of Operations as unrealized gains or losses on digital assets or realized gains or losses on conversions of staking rewards in U.S. dollars, as applicable.

Realized gains and losses on digital assets

To the extent staking rewards are converted into U.S. dollars, realized gains and losses are recognized for the difference between the proceeds received and the historical cost basis of the digital assets converted, determined using the first-in, first-out (“FIFO”) method. These amounts are presented within operating expenses in the Condensed Consolidated Statements of Operations as realized gains or losses on conversions of staking rewards into U.S. dollars.

To the extent digital assets are sold, realized gains and losses are recognized for the difference between the proceeds received and the historical cost basis of the digital assets sold, determined using the FIFO method. These amounts are presented within operating expenses in the Condensed Consolidated Statements of Operations as gains or losses on sales of digital assets.

Stock-Based Compensation - The Company recognizes all stock-based payments to employees, including grants of employee stock options and grants of restricted shares as compensation expense in the condensed consolidated financial statements based on their fair values. That expense will be recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period) or immediately if the stock-based payments vest immediately.

Fair Value Measurements - The Company accounts for financial instruments in accordance with ASC 820. ASC 820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs).

The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Liquid Solana tokens are measured at fair value using quoted prices from CoinMarketCap (Level 1 inputs). The fair value of locked tokens is computed by taking the number of locked tokens and discounting the quoted prices from CoinMarketCap. The discount, a Level 2 input, used by management is based on the Company’s historical purchases of locked Solana. Management monitors this discount percentage and adjusts when appropriate.

The carrying amounts of certain financial instruments, including cash, accounts receivable, accounts payable, accrued expenses, and deferred revenue are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

Income Taxes - Income taxes are provided for the tax effects of transactions reported in the condensed consolidated financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. The deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of the available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company’s valuation allowance was $52,898,250 and $79,802,562 as of September 30, 2026 and June 30, 2026, respectively.

The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.

The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, Income Taxes. Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s condensed consolidated financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. 

ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s condensed consolidated financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company had no material uncertain tax positions at September 30, 2026 and June 30, 2026.

Convertible Debt - The Company accounts for its convertible debt instruments in accordance with ASC 470-20, Debt with Conversion and Other Options. Convertible debt instruments are initially accounted for as a single unit of account unless an embedded feature requires bifurcation from the host contract and separate accounting as a derivative pursuant to ASC 815, Derivatives and Hedging, or the substantial premium model in ASC 470-20 applies. The Company evaluates the terms of each convertible debt instrument at issuance and upon modification or other events requiring reassessment to determine the appropriate classification and accounting.

Certain of the Company’s convertible notes include provisions requiring settlement of unconverted principal through the delivery of specified quantities of SOL and fixed-price conversion features. Management evaluates the SOL settlement feature under ASC 815, including whether the feature is clearly and closely related to the debt host and whether it meets the definition of a derivative. This evaluation includes consideration of whether the applicable contractual quantity of SOL is readily convertible to cash, based on the relevant settlement terms, transfer restrictions, market liquidity, expected price impact, and the ability of the market to absorb the applicable quantity without significantly affecting price. Management also evaluates whether conversion features qualify for the ASC 815 scope exception for contracts involving the Company’s own equity, including whether the feature is indexed to the Company’s own stock and would be classified in stockholders’ equity if it were a freestanding instrument.

If an embedded feature is bifurcated, the Company initially records the derivative at fair value and subsequently remeasures it at fair value through earnings. If no embedded feature requires bifurcation, the convertible debt is subsequently accounted for in accordance with the terms of the instrument, including recognition of interest expense using the applicable contractual interest rate or effective interest method, as appropriate. For the Company’s existing notes, management concluded that the SOL repayment feature does not require bifurcation because it does not meet the derivative definition, and that the conversion feature qualifies for the own-equity scope exception.