Stablecoin Development Corp

Framework for Evaluating Additional Digital Assets

The IAC evaluates and recommends, and the Board approves, any addition to the Company’s asset holdings. In evaluating a prospective asset, the IAC applies the following principal criteria: valuation, meaning whether the asset is attractively priced relative to the economic returns it generates, its net asset value, or comparable measures; productivity, meaning whether the asset generates identifiable economic returns to holders, such as profits, distributions, yield, or staking or protocol rewards, as distinguished from assets whose return depends principally on price appreciation or, in the case of digital assets, on inflationary issuance of new tokens; liquidity, meaning the depth and quality of the markets in which the asset trades and the Company’s ability to acquire or dispose of a position of meaningful size without undue price impact; and quality, meaning the durability of the asset’s underlying economics and, for digital assets, protocol revenue durability, security and audit history, governance quality, and custody and operational feasibility within the Company’s infrastructure, together in all cases with the asset’s legal, regulatory, tax, and accounting profile and its effect on portfolio concentration. The Company regards a digital asset as exhibiting “revenue-generating characteristics” where its economics derive from identifiable protocol-level revenue, such as fees from stablecoin issuance, lending, settlement, or comparable on-chain financial services, that funds distributions, buybacks, or rewards to token holders. The IAC’s mandate is not limited to digital assets, but SKY remains the only asset approved under the framework. Any addition that would constitute a material amendment, modification, or addition to the Company’s digital asset strategy is subject to the Purchasers’ consent right described under “Our Business, The Sky Protocol: Creation and Governance” above.