SharpLink Gaming, Inc.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

three and nine months ended September 30, 2025 and 2024

Note 1 –Organization

Background and Nature of Business

Headquartered in Minneapolis, SharpLink Gaming, Inc. (the “Company” of “Sharplink”), a Delaware corporation, undertook a significant strategic shift in June 2025 by adopting Ether (“ETH”), the native cryptocurrency of the Ethereum blockchain, as its primary treasury asset. This strategy reflects the Company’s commitment to align the corporate treasury with the future of programmable finance, digital capital markets and decentralized infrastructure. The Company uses proceeds from financings to accumulate ETH, which is then deployed in staking to generate rewards. Staking rewards earned from staking are also staked to generate additional rewards. SeeNote 3 – Digital Asset Holdings. The Company also operates an online affiliate marketing company that delivers unique fan activation solutions to its sportsbook and online casino gaming partners. The Company’s ETH Treasury Management strategy is now its predominant operational focus.

Since the launch of its ETH Treasury Management strategy, the Company has raised capital through private investment in public equity (“PIPE”) transactions, follow-on offerings, and at-the-market (“ATM”) sales. The Company has deployed the majority of the proceeds to acquire ETH. Additional details regarding these equity offerings are included inNote 9 – Equity.

Tokenization of Stock

On September 24, 2025, the Company entered into a digital transfer agent agreement with Superstate Services LLC with the intent to tokenize the Company’s common stock, par value $0.0001 per share (the “Common Stock”) on the Ethereum blockchain. As of the date of this filing, the Company has not tokenized any of its common stock.

Reverse Stock Split

On May 5, 2025, the Company effected aone-for-twelve (1:12) reverse stock split of all the Company’s Common Stock, whereby the Company decreased the number of issued and outstanding Common Stock from 7,916,206 to 659,684. Proportional adjustments for the reverse stock split were made to the Company’s outstanding stock options, warrants and equity incentive plans. All share and per-share data and amounts have been retrospectively adjusted as of the earliest period presented in the financial statements to reflect the reverse stock split.

Acquisition of 10% Equity Stake in Armchair Enterprises

On February 24, 2025, SharpLink entered into a subscription agreement (“Subscription Agreement”) with U.K-based Armchair Enterprises Limited (“Armchair”), which owns and operates CryptoCasino.com. The acquisition of a 10% equity stake in Armchair was made for $500,000 in cash, along with a right of first refusal to acquire a controlling interest in Armchair. The investment was recorded at cost and will be measured at cost less impairment, adjusted for any observable price changes. There was no impairment as of September 30, 2025.

Domestication

On February 13, 2024, SharpLink Gaming Ltd. (“SharpLink Israel” and former parent company) completed its previously announced domestication merger (“Domestication Merger”), pursuant to the terms and conditions set forth in an Agreement and Plan of Merger (the “Domestication Merger Agreement”), dated June 14, 2023 and amended July 24, 2023, among SharpLink Gaming, Inc. (“SharpLink US”), SharpLink Israel, SharpLink Merger Sub Ltd., an Israeli company and a wholly owned subsidiary of subsidiary of SharpLink US (Domestication Merger Sub) . The Domestication Merger was achieved through a merger of Domestication Merger Sub Ltd. with and into SharpLink Israel, with SharpLink Israel surviving the merger and becoming a wholly owned subsidiary of SharpLink US. The Domestication Merger was approved by the shareholders of SharpLink Israel at an extraordinary special meeting of shareholders held on December 6, 2023. The Common Stock of SharpLink commenced trading on the Nasdaq Capital Market under the same ticker symbol, SBET, on February 14, 2024.

As a result of the Domestication Merger, all SharpLink Israel ordinary shares outstanding immediately prior to the Domestication Merger automatically converted, on a one-for-one basis, into the right to receive, and become exchangeable for, shares of SharpLink US Common Stock and all preferred shares, options and warrants of SharpLink Israel outstanding immediately prior to the Domestication Merger converted into or exchanged for equivalent securities of SharpLink US on a one-for-one basis.

The following represents the change in the par value based on the outstanding ordinary and preferred shares to common and preferred stock after the Domestication Merger on February 13, 2024:

Exchange of Series A-1 Preferred Stock and Series B Preferred Stock for Common Stock and Prefunded Warrants

On April 2, 2025, SharpLink entered into an exchange agreement (“Exchange Agreement”) with Alpha Capital Anstalt (“Alpha”), whereby, pursuant to the terms and conditions set forth in the Exchange Agreement and in reliance on Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”),600 shares of the Company’s Series A-1 Preferred Stock and 1,040 shares of the Company’s Series B Preferred Stock (collectively, the “Existing Securities”) held by Alpha were exchanged for 38,683 shares of SharpLink’s Common Stock and 44,650 prefunded warrants to purchase shares of SharpLink’s Common Stock (“Alpha Prefunded Warrants”) at an exercise price of $0.012. With the exchange of Alpha’s Existing Securities for Common Stock and Alpha Prefunded Warrants, SharpLink no longer has any Series A-1 Preferred Stock or Series B Preferred Stock issued and outstanding. SeeNote 9 - Equity.

Note 2–Summary of Significant Accounting Policies

(a)Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared by SharpLink Gaming, Inc., pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of the Company, the foregoing statements contain all adjustments, consisting only of normal recurring adjustments necessary to present fairly the financial position of the Company as of September 30, 2025 and December 31, 2024, as well as its results of operations for the three and nine months ended September 30, 2025 and 2024. The condensed consolidated balance sheet as of December 31, 2024 has been derived from the audited consolidated financial statements as of that date. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts therein. Due to the inherent uncertainty involved in making estimates, actual results in future periods may differ from the estimates.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by rules and regulations of the SEC. Accordingly, the condensed consolidated financial statements do not include all information and footnotes required by GAAP for a complete financial statement presentation. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto for the year ended December 31, 2024, which are included in the Company’s Annual Report on Form 10-K filed with the SEC on March 14, 2025 and Form 10-K/A filed with the SEC on March 17, 2025. There have been no significant changes in the Company’s accounting policies since December 31, 2024, except as discussed below inNote 3(d) - Crypto Assets and 3(e) Staking activities, related to the Company’s ETH Treasury Management Strategy.

During the three months ended September 30, 2025, the Company revised its presentation of the condensed consolidated statements of operations to align with its current view of operations. Specifically, other operating income now reflects to Company’s ETH Treasury Management results, including realized gains and losses on crypto assets at fair value and unrealized gains and losses on changes in the fair value of crypto assets held. In addition, cost of revenue from affiliate marketing has been reclassified into operating expenses.

(b)Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of SharpLink and its wholly owned subsidiaries. All intercompany accounts and transactions between consolidated subsidiaries have been eliminated in consolidation.

(c)Functional Currency

The Company’s functional and reporting currency is the U.S. dollar. Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction. The resulting monetary assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the balance sheet date. Revenue and expense components are translated to U.S. dollars at weighted-average exchange rates in effect during the period. Foreign currency translation adjustments, which arise from the remeasurement of foreign-denominated monetary assets and liabilities, are typically recorded in Other Comprehensive Income (“OCI”) in accordance with U.S. GAAP, however, the Company does not have material operations in a foreign currency which require translation into U.S dollars. Foreign currency transaction gains and losses resulting from remeasurement are recognized in selling, general and administrative expenses within the condensed consolidated statements of operations.

(d)Crypto Assets

The Company’s crypto assets primarily consist of ETH, the native token of the Ethereum blockchain, and Liquid Staked Ether (“LsETH”), a token received when ETH is staked through a third-party liquid staking protocol. ETH and LsETH are presented separately on the Condensed Consolidated Balance Sheet under the captions “Crypto assets at fair value” and “Crypto assets at cost” respectively. The Company has ownership of and control over its crypto assets which are held through custodial arrangements with qualified third-party custodians. These custodians provide secure storage and safeguarding of the Company’s crypto assets, including both ETH and LsETH.

Crypto assets at fair value

Crypto assets acquired are initially recorded at cost, which represents the cash, cash equivalents, or other financial assets paid to acquire the asset, including transaction fees. Crypto assets received in exchange for goods or services, or in connection with the issuance of shares, are recognized at their fair value on the date received, which becomes their cost basis.

Crypto assets are subsequently measured in accordance with ASC 350-60,Intangibles—Goodwill and Other—Accounting for and Disclosure of Crypto Assets, at fair value in the statement of financial position with unrealized gains and losses resulting from changes in fair value recognized in net income. The Company determines and records at each reporting period the fair value of its crypto assets in accordance with ASC 820,Fair Value Measurement, based on quoted (unadjusted) prices on the Coinbase exchange, the active exchange that the Company has determined is its principal market for ETH (Level 1 inputs). Changes in the fair value are recognized in net income within “Unrealized gain on crypto assets”, while realized gains and losses from the derecognition of crypto assets are included in “Realized gain on crypto assets, net” in the Company’s condensed consolidated statements of operations. The Company applies a first-in, first-out methodology to assign costs for purposes of determining crypto assets held and realized gains and losses.

Purchases and sales of crypto assets are reflected as cash flows from investing activities in the consolidated statements of cash flows. Contributions of crypto assets received in connection with the issuance of shares and deposits of ETH into a liquid staking protocol are presented as non-cash investing and financing activities.

Crypto assets at cost

Crypto assets at cost are recognized at fair value on the date received, which becomes their cost basis. Crypto assets at cost, such as LsETH, do not fall in the scope of ASC 350-60 for subsequent measurement. LsETH represents a receipt token, which in general and by design, grants the holder an enforceable right to redeem ETH for which it was exchanged. Therefore, it fails the ‘other goods and services criterion’ in ASC 350-60-15-1(b) and is outside the scope of ASC 350-60. Crypto assets at cost are therefore subsequently measured at cost, net of any impairment losses incurred since acquisition, in accordance with ASC 350-30,Intangibles—Goodwill and Other—General Intangibles Other Than Goodwill.

The Company performs an analysis each quarter to identify whether events or changes in circumstances, principally decreases in the quoted (unadjusted) prices in the Company’s principal market, indicates that it is more likely than not that any of the assets are impaired. The quoted (unadjusted) prices on the Coinbase exchange, the active exchange that the Company has determined as its principal market, are used in the analysis. In determining if an impairment has occurred, the Company considers the lowest price of one LsETH quoted on the Coinbase exchange, at any time since acquiring the specific LsETH held by the Company. If the carrying value of a LsETH exceeds that lowest intraday price, an impairment loss has occurred with respect to that LsETH in the amount equal to the difference between its carrying value and such lowest price. Impairment losses are recognized in the period in which the impairment occurs and are reflected within “Impairment of crypto assets at cost” in the Company’s condensed consolidated statements of operations. The impaired crypto assets are written down to their fair value at the time of impairment and this becomes the new cost basis for those assets. The cost basis of LsETH will not be adjusted upward for any subsequent increase in fair value.

LsETH received in connection with staking of ETH into a liquid staking protocol are presented as non-cash investing activities.

(e)Staking activities

Beginning in June 2025, the Company began staking its ETH. To date, this has included both native staking and liquid staking. The Company initiated both native staking and liquid staking in June 2025, and intends for staking to become a primary yield generation strategy of the Company during the current fiscal year.

Native Staking

The Company participates in native staking exclusively as a delegator through third-party validators. The Company delegates ETH to validators, either directly or through third party asset managers, who operate nodes on the Ethereum network to validate transactions and add blocks to the blockchain. In return for delegating ETH to validators, the Company is entitled to a portion of the block rewards and transaction fees earned by the validators, in the form of ETH tokens, calculated approximately based on the Company’s proportion of the total ETH staked. When the Company stakes ETH natively, the ETH does not remain in the Company’s custodial wallet, but is instead deposited into Ethereum’s staking deposit smart contract, which is required for participation in ETH staking as a delegator. Native staked ETH are not derecognized because their deposit into the smart contract does not give any other entity the right or ability to direct their use (for example, sell, lend, pledge or otherwise use those ETH). The withdrawal credentials in the smart contract are designated to the Company’s custodian, who, as described in Note 2(d), holds the Company’s ETH solely for the Company’s benefit and does not obtain control of the Company’s ETH via their custodial services. Native staked ETH are therefore not derecognized.

Rewards from native staking activities are recognized as revenue in accordance with ASC 606,Revenue from Contracts with Customers. The delegation of the Company's ETH to validators represents an output of the Company’s ordinary activities. In this case our performance obligation is the provision of our validation rights to the validators, from which we earn variable consideration, in the form of ETH, which is non-cash consideration, measured at the fair value of ETH as of contract inception based on the quoted (unadjusted) prices on the Coinbase exchange, the active exchange that the Company has determined is its principal market. Revenue is recognized at the point in time when the Ethereum network confirms that the validation is complete. As a delegator, the Company has concluded it is not the principal to the block validation service provided to the Ethereum Network; it is the validators that control the service. Instead, the Company's service is one of providing the use of its ETH by the validators to increase their validation opportunities. Consequently, the Company records staking revenue on a net basis, reflecting only the portion of protocol rewards to which it is entitled after validator commissions are deducted. Fees paid to third-party asset managers of approximately $3.5M and custodians of approximately $657,000 are recognized separately as operating expenses.

Liquid Staking

The Company also participates in liquid staking through a liquid staking protocol. One key difference and intended benefit of liquid staking versus native staking is that it allows the Company to earn staking rewards, like native staking, but provides liquidity and the ability to enter into other transactions through the receipt token. Instead of directly locking ETH into the Ethereum staking deposit contract, the Company deposits ETH through its custodian into the liquid staking protocol’s smart contract. The liquid staking protocol then controls the ETH for deposit into the Ethereum’s staking deposit contract and further delegation to its chosen validators. In exchange for staking its ETH, the Company receives LsETH, a freely transferable ERC-20 liquid staking receipt token, which enables participation in decentralized finance (DeFi) and other crypto markets while the underlying ETH remains staked. Upon staking ETH through the liquid staking protocol, the ETH is derecognized because the liquid staking protocol obtains the ability to deploy and direct its use, and the LsETH token received concurrently is then recognized. Any gain or loss on the staking transaction is recognized in accordance with ASC 610-20,Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (“ASC 610-20”) based on the difference between the carrying amount of the ETH staked and the fair value of the LsETH received; and included in “Realized gain on crypto assets, net” in the Company’s Condensed Consolidated Statements of Operations.

The liquid staking protocol uses a floating conversion rate, or protocol conversion rate, between the receipt token and staked tokens, reflecting the value of accrued network rewards, penalties, and fees associated with the staked ETH. The conversion rate between LsETH and ETH increases over time as staking rewards accrue to the protocol; no new LsETH are received. Staking rewards in the form of ETH are only received upon redemption of LsETH.

Because LsETH is accounted for under ASC 350-30 (see Note 2(d)), increases in LsETH fair value while the Company remains staked with the liquid staking protocols, are not recognized. Staking rewards are therefore recognized when the LsETH is redeemed, measured at the fair value of ETH at contract inception, which is when the ETH were staked. Staking rewards will be included in other revenues in the Company’s Condensed Consolidated Statements of Operations. Gain or loss resulting from the difference between the carrying amount of the LsETH redeemed and the fair value of ETH received at redemption, other than staking rewards, will be included in operating income (expense) in the Company’s Condensed Consolidated Statements of Operations. No LsETH was redeemed or sold in the three and nine-month periods ended September 30, 2025.

(f) USDC stablecoin

USD stablecoin (“USDC”) is accounted for as a financial asset that can be redeemed on the basis of one USDC for one U.S. dollar on demand from the issuer. While not accounted for as cash or cash equivalents, the Company treats its USDC holdings as a liquidity resource. The USDC received rewards from Coinbase on USDC held with Coinbase, for which approximately $138,000 was recorded during the three months ended September 30, 2025, and netted against custodial fees in operating expenses in accordance with ASC 705-20Accounting for Considerations Received from a Vendor. The Company's USDC are held with qualified third-party custodians who provide secure storage and safeguarding of the Company's USDC. The Company's custodians do not obtain control over the Company's USDC; therefore we continue to recognize USDC as our own for accounting purposes.

(g)Affiliate Marketing Revenue Recognition

The Company recognizes revenue in accordance with ASC 606. To determine revenue recognition for contracts with customers, the Company performs the following five steps: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur; (iv) allocate the transaction price to the respective performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies the performance obligation. The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. For the three and nine months ended September 30, 2025, the Company has recognized its revenue at a point in time for certain contracts and over time for other contracts. The timing of revenue recognition may differ from the timing of invoicing to customers, and these timing differences result in contract advanced billings on the Company’s condensed consolidated balance sheet. The Company recognized unbilled revenue when revenue is recognized prior to invoicing. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 days. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that its contracts generally do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s services, and not to facilitate financing arrangements. The Company acts as an agent and records revenue net of commissions retained.

(h)Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-04,Debt - Debt with Conversions and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments(“ASU 2024-04”). ASU 2024-04 is intended to clarify requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features or convertible debt instruments that are not currently convertible, should be accounted for as an induced conversion. This ASU is effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures.

In November 2024, the FASB issued ASU 2024-03,Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued Accounting Standards Update No. 2025-01,Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for the Company for annual reporting periods beginning in fiscal 2027 and for interim reporting periods beginning in fiscal 2028 on a prospective basis. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its disclosures.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09,Income Taxes (Topic 740): Improvements to Income Tax Disclosures(“ASU 2023-09”). ASU 2023-09 requires enhanced disclosures surrounding income taxes, particularly related to rate reconciliation and income taxes paid information. In particular, on an annual basis, companies will be required to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Companies will also be required to disclose, on an annual basis, the amount of income taxes paid, disaggregated by federal, state, and foreign taxes, and also disaggregated by individual jurisdictions above a quantitative threshold. The standard is effective for the Company for annual periods beginning January 1, 2025 on a prospective basis, with retrospective application permitted for all prior periods presented. The Company will adopt ASU 2023-09 for the annual period ending December 31, 2025 and is currently evaluating the impact of this guidance on its disclosures.

Note 3–Digital Asset Holdings

Crypto Assets at fair value

The following table sets forth the units held, cost basis and fair value of crypto assets held, as shown on the condensed consolidated balance sheet as of September 30, 2025:

Fair value represents the quoted (unadjusted) prices on the Coinbase exchange as of midnight UTC on the measurement date.

As of December 31, 2024, the Company did not hold any crypto assets.

The following table represents a reconciliation of crypto assets held at fair value:

Crypto Assets at cost

The following table sets forth the cost basis, impairment amount, and carrying amount of crypto assets held at cost, as shown on the condensed consolidated balance sheet as of September 30, 2025:

For the nine months ended September 30, 2025, the Company recorded an impairment loss of $94.7 million related to the ETH Treasury Management segment, SeeNote 4 - Operating Segments, in the condensed consolidated statement of operations within “Impairment of crypto assets at cost”.

Note 4 –Operating Segments

The Company’s Co-Chief Executive Officers serve as the Chief Operating Decision Maker (“CODM”) and evaluates the financial performance of the business and makes resource allocation decisions on the basis of its two different revenue sources. The ETH Treasury Management segment captures ETH-based yield generated by participating in the Ethereum network’s staking protocol which is currently comprised of rewards received from native staking. The Affiliate Marketing segment is focused on performance-based customer acquisition services for leading sportsbooks and online casino gaming operators throughout the world.

As a result, the Company operatestwo reportable segments under ASC 280,*Segment Reporting,*ETH Treasury Management and Affiliate Marketing.

Total ETH Treasury Management net income from continuing operations before income taxes was $105.0 million and $0.7 million for the three and nine months ended September 30, 2025. Total Affiliate Marketing net income (loss) from continuing operations before income taxes was $(1,774) and $42,865 for the three and nine months ended September 30, 2025, respectively.

ETH Treasury Management

The CODM assesses financial performance based on consolidated revenue, operating profit and key operating expenses as detailed below.

The following table presents significant segment expenses regularly provided to and reviewed by the CODM for the ETH Treasury Management segment:

These expenses represent the key cost components reviewed by the CODM in assessing the Company’s performance.

The CODM evaluates income generated from the Company’s assets using net income (loss) as a key metric. The CODM utilizes this measure to assess return on assets when making strategic decisions, including whether to reinvest profits into the affiliate marketing platform or ETH Treasury Management business, enhance technology and data analytics capabilities, or expand partnerships with advertisers and publishers.

Affiliate Marketing

The Company’s Affiliate Marketing operations include performance marketing services, lead generation and data analytics. The Company focuses on delivering quality traffic and player acquisitions, retention and conversions to global casino gaming partners worldwide in exchange for a commission (cost per acquisition or portion of net gaming revenues) paid to the Company by the partners for the new players referred to them. The CODM assesses financial performance based on revenue, operating profit and key operating expenses as detailed below.

The following table presents significant segment expenses regularly provided to and reviewed by the CODM for the Affiliated Marketing Segment:

The following table provides reconciliation to consolidated net income (loss) from continuing operations before income taxes:

Revenue by Geographic Location

Summarized revenues by country in which the Company operated for the three and nine months ended September 30, 2025 and 2024 are shown below. All ETH Treasury Management revenue occurred within the United States.

For the Three Months Ended September 30, 2025:

For the Nine Months Ended September 30, 2025:

For the Three Months Ended September 30, 2024:

For the Nine Months Ended September 30, 2024:

The Company does not have material assets in foreign jurisdictions.

The Company’s Affiliate Marketing Services segment derives a significant portion of its revenues from several large customers. The table below presents the percentage of consolidated revenues derived from large customers:

Note 5 –Revenue Recognition

The Company is currently engaged in ETH Treasury Management activities and the provision of Affiliate Marketing services.

ETH Treasury Management

As of September 30, 2025, the Company had natively staked 580,192 ETH on the Ethereum blockchain and 649 ETH unstaked for a total of 580,841 ETH held at quarter end. For the nine-month period ended September 30, 2025, the Company earned 2,391 ETH and recognized revenue from native staking rewards of $10,302,343. No LsETH was redeemed or sold in the nine-month period ended September 30, 2025.

Affiliate Marketing

The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.

For the three and nine months ended September 30, 2025, the Company has recognized its revenue at a point in time.

The timing of revenue recognition may differ from the timing of invoicing to customers, and these timing differences result in contract advanced billings on the Company’s condensed consolidated balance sheet. The Company recognized unbilled revenue when revenue is recognized prior to invoicing.

Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 days. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that its contracts generally do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s services, and not to facilitate financing arrangements.

The Company’s assets and liabilities related to its contracts with customers were as follows:

Note 6 –Additional Balance Sheet Information

Equipment, net

Equipment consists of computers, furniture and fixtures and is presented net of accumulated depreciation from continuing operations for a net book value of $7,860 and $3,359 as of September 30, 2025 and December 31, 2024, respectively. Depreciation expense from continuing operations for the nine months ended September 30, 2025 and 2024 was $2,468 and $5,887, respectively.

Intangible assets, net

Intangible assets, net of accumulated amortization as of September 30, 2025 and December 31, 2024 consisted of the following:

Amortization expense from continuing operations on intangible assets for the nine months ended September 30, 2025 and 2024 was $3,693 and $3,706, respectively.

Note 7–Warrants

Following is a summary of the Company’s warrant activity for the nine months ended September 30, 2025:

The Company recognized $16.3 million of stock-based compensation expense for 3,455,019 warrants to purchase the Company’s Common Stock (“Strategic Advisor Warrants”) issued to Consensys Software Inc. (“Consensys”) in conjunction with the Strategic Advisory Agreement (Refer to Note 14–Related Parties). The Strategic Advisor Warrants have various exercise prices as follows:(i) 1,382,007 shares of common stock at an exercise price of $6.15 per share of common stock; (ii) 691,004 shares of common stock at an exercise price of $6.765 per share of common stock; (iii) 691,004 shares of common stock at an exercise price of $7.38 per share of common stock; and (iv) 691,004 shares of common stock at an exercise price of $7.995 per share of common stock. SeeNote 14 — Related Party Transactions.

The Company recognized $12.9 million of stock-based compensation expense recognized as contra-equity for the 2,764,013 placement agent warrants to purchase shares of common stock issued to the Agent in conjunction with the May 2025 PIPE Offering (as defined below). The warrants have an exercise price of $7.68 per share of common stock.

The strategic advisor and placement agent warrants are accounted for under ASC 718, Compensation—Stock Compensation. Both the Strategic Advisor Warrants and the placement agent warrants are fully vested, nonforfeitable and not subject to any clawback provisions on the grant date. Accordingly, the grant date fair value of the Strategic Advisor Warrants is recognized in full as compensation in the income statement upfront. The grant date fair value of the placement agent warrants is recorded as contra-equity as the warrants represent non-cash consideration for costs of placement agent services, which are directly attributable costs to raise capital in the May 2025 PIPE Offering.

The fair value of each warrant grant is estimated on the date of grant using the Black Scholes option pricing model with the following assumptions:

Pre-funded warrants

The Company issued 1,496,612 pre-funded warrants to purchase shares of common stock to Consensys in conjunction with the $4.5 Million Registered Offering. The warrants have an exercise price of $0.0001 per share of common stock.

The Company issued 3,966,340 pre-funded warrants to purchase shares of common stock to Consensys in conjunction with the PIPE Offering. The warrants have an exercise price of $0.0001 per share of common stock.

The Company issued 6,434,213 pre-funded warrants to purchase shares of common stock to Joseph Lubin in conjunction with the PIPE Offering. The warrants have an exercise price of $0.0001 per share of common stock.

The Company issued 44,650 pre-funded warrants to purchase shares of common stock to Alpha in conjunction with the April 2, 2025 Exchange Agreement. The warrants have an exercise price of $0.0001 per share of common stock and were exercised in full during the period ended June 30, 2025.

The pre-funded warrants met the criteria for classification within stockholders’ equity as permanent equity, with no subsequent remeasurement required. The fair value of each warrant awarded for compensation is estimated on the date of grant using a Black Scholes option-pricing model. The Company uses historical option exercise and termination data to estimate the term the options are expected to be outstanding. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield is calculated using historical dividend amounts and the stock price at the option issue date. The expected volatility is determined using the volatility of peer companies.

Letter Agreements

Between July 8, 2025 and July 10, 2025, the Company entered into letter agreements (“Letter Agreements”) with the holders of the Company’s Common Stock, pre-funded warrants, Strategic Advisor Warrants and placement agent warrants, which were issued in connection with the Company’s private placement pursuant to the two securities purchase agreements, dated May 20, 2025 and May 26, 2025.

Pursuant to the Letter Agreements, the Company may reserve for issuance under the ATM sales agreement between the Company and A.G.P./Alliance Global Partners (“A.G.P.”) any of the authorized shares of common stock that would otherwise be reserved for issuance under the Strategic Advisor Warrants (as defined inNote 14–Related Parties), placement agent warrants, private placement pre-funded warrants and best efforts pre-funded warrants, with the understanding that (i) the Company may issue such shares pursuant to the ATM facility at any time after the execution of the Letter Agreements and before the date on which the Company receives the requisite stockholder approval (the “Stockholder Approval”) to increase the Company’s authorized shares, and (ii) following the receipt of the Stockholder Approval with respect to the authorized share increase, the Company shall reserve the shares underlying the various warrants. Following receipt of Stockholder Approval on July 24, 2025 at the Special Meeting of Stockholders, the authorized share capital was increased and the Letter Agreements were terminated.

The termination of these Letter Agreements had no impact on the Company’s accounting or financial statement presentation, as no new rights or obligations were created or extinguished upon termination.

The following is a summary of the Company’s warrant activity for the nine months ended September 30, 2024:

Note 8 –Stock Compensation

Inducement Award Plan

On August 19, 2025, the board of directors (the “Board”) of the Company adopted the SharpLink Gaming, Inc. Inducement Award Plan (the “Inducement Award Plan”). The Board reserved 3,000,000 shares of the Company’s Common Stock for issuance under the Inducement Award Plan, including restricted stock units (time-based and performance-based), subject to adjustment as provided in the plan document.

The terms of the Inducement Award Plan are substantially similar to the terms of the Company’s Amended and Restated 2023 Equity Incentive Plan, with the exception that incentive stock options may not be issued under the Inducement Award Plan, and equity awards under the Inducement Award Plan (including nonqualified stock options, restricted stock, restricted stock units, and other stock-based awards) may be issued only to an employee who is commencing employment with the Company or any subsidiary or who is being rehired following a bona fide interruption of employment by the Company or any subsidiary, in either case if he or she is granted such award in connection with his or her commencement of employment and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary.

In August, the Company granted 443,385 restricted stock units to the newly appointed Co-CEO with 147,795 performance based awards and 295,590 service based awards, under the Inducement Award Plan (see Restricted Stock Units - Performance Based below).

Stock Options

Option awards are generally granted with an exercise price equal to the market price of the Company’s common stock at the date of grant; those options generally vest based on three years of continuous service and have ten-year contractual terms. Certain option and share awards provide for accelerated vesting if there is a change in control, as defined in the plans. For the nine months ended September 30, 2025, the Company managed the following equity plans: SharpLink Gaming Ltd. 2021 Equity Incentive Plan, SharpLink, Inc. 2020 Stock Incentive Plan, and SharpLink Gaming, Inc. 2023 Equity Incentive Plan.

The Company grantedno options for the three and nine months ended September 30, 2025 and 2024, respectively. The Company recognized stock compensation expense for stock options of $100,688 and $124,763 for the nine months ended September 30, 2025 and 2024, respectively, of which $0 and $12,041 of expense are recorded in discontinued operations. The Company recognized stock compensation expense for stock options of $27,839 and $39,559 for the three months ended September 30, 2025 and 2024, respectively.

The summary of activity under the plans as of September 30, 2025, and change during the nine months ended September 30, 2025, is as follows:

Unamortized stock compensation expense of $8,385 will be recognized through 2026 for 303 unvested options which have a weighted average recognition period ofseven years.

The summary of activity under the plans as of September 30, 2024, and change during the nine months ended September 30, 2024, is as follows:

Restricted Stock Units - Service Based

The Company’s Compensation Committee recommended to the Board and the Board approved the granting of certain restricted stock units (“RSUs”) to employees and the Board that vest over the passage of time. The Company recognized stock compensation expense for service based RSU awards of $3,545,855 and $317,600 for the nine months ended September 30, 2025 and 2024, respectively. The Company recognized stock compensation expense for service based RSU’s of $3,251,673 and $317,600 for the three months ended September 30, 2025 and 2024, respectively.

The following is a summary of service based RSU activity for the nine months ended September 30, 2025:

The total unrecognized compensation cost related to unvested service based RSUs as of September 30, 2025 was $25,209,182.

The following is a summary of RSU activity for the nine months ended September 30, 2024:

Restricted Stock Units - Performance Based

The Company’s Compensation Committee recommended to the Board of Directors and the Board approved the design of performance based restricted stock units (“Performance RSU”) for certain executive officers. The awards are intended to vest based on the achievement of specified financial and operational performance metrics over a three-year performance period, subject to continued service through the end of the performance period. The Company recognizes the stock-based compensation expense in connection with the Performance RSUs when they are granted or at the service inception date if the service inception date precedes the grant date. As of September 30, 2025, a grant date had not yet been established for 115,069 Performance RSUs because certain performance conditions and award parameters remained subject to the final determination by the Compensation Committee. The Company remeasures the fair value of the award at each reporting date, as the service date preceded the grant date. In the period in which the grant date occurs, cumulative compensation cost will be adjusted to reflect the cumulative effect of measuring compensation cost based on the fair value at the grant date rather than the fair value previously used at the service inception date or subsequent reporting dates. For the three and nine months ended September 30, 2025, the Company recognized $64,447 in stock compensation expense. Unamortized stock compensation expense of$2,144,370 will be recognized through 2028 for 115,069 unvested options.

There were no Performance RSU’s issued during 2024.

Note 9–Equity

Preferred Stock

The Company has 15,000,000 preferred stock authorized, par value of $0.0001. There isno preferred stock issued or outstanding as of September 30, 2025.

At-The-Market (“ATM”) Offerings

On May 2, 2024, Company entered into an ATM Sales Agreement (the “May 2024 ATM Sales Agreement”) with A.G.P./Alliance Global Partners (“A.G.P.”) pursuant to which the Company may offer and sell, from time to time, through A.G.P., as sales agent and/or principal, shares of the Company’s Common Stock, having an aggregate offering price of up to $1.7 million, subject to certain limitations on the amount of Common Stock that may be offered and sold by the Company set forth in the May 2024 ATM Sales Agreement (the “Offering”). On February 4, 2025, the Company, under the terms of the ATM Sales Agreement, filed a prospectus supplement that amended the number shares of Common Stock having an aggregate offering price of up to $1.8 million.

On May 30, 2025, SharpLink entered into a second ATM Sales Agreement (the “May 2025 ATM Sales Agreement”) with A.G.P. relating to the sale of shares of the Company’s Common Stock from time to time, having an aggregate offering price of up to $1.0 billion.

On July 17, 2025, SharpLink entered into an amendment to the May 2025 ATM Sales Agreement (the “Amendment”) with A.G.P to increase the number of shares that may be sold from time to time in connection with the ATM facility from $1.0 billion to $6.0 billion; and to permit the forward sale of shares to be sold in the ATM offering to master forward confirmation letter agreements. On July 17, 2025, the Company filed a supplement to the prospectus supplement with the SEC to address the Amendment and the forward sales agreements.

On July 17, 2025, the Company entered into a forward sales agreement to permit the forward sale of shares of the Company’s Common Stock to A.G.P. The forward sales agreement was outstanding for one week and was settled with the purchase of 6.8 million shares for $201.1 million. The Company accounted for the forward sales agreement as an equity instrument as the agreement required for physical settlement in shares of the Company’s Common Stock and did not require or permit net cash settlement. Accordingly, the contract was recorded in equity, and no gains or losses were recognized in earnings during the period. Upon settlement of the forward sales agreement, the proceeds were recorded as an increase to Common Stock and additional paid in capital as part of the ATM offerings.

On August 19, 2025, the Company entered into an amended and restated sales agreement (which amended and restated the May 2025 ATM Sales Agreement) to add additional sales agents to the ATM offering and to make certain conforming changes.

As of September 30, 2025, SharpLink has raised total gross proceeds of $2,147,072,919 from sales of shares under the amended and restated May 2025 ATM Sales Agreement. The proceeds were used to further the Company’s ETH Treasury Management strategy as well as provide for working capital.

Equity Offerings

$4.5 Million Offering

On May 20, 2025, the Company entered into a securities purchase agreement (the “May 20, 2025 Purchase Agreement”) for an offering of 34,000 shares of Common Stock, $0.0001 par value per share, and pre-funded warrants to purchase up to 1,496,612 shares of Common Stock. The shares were offered at an offering price of $2.94 per share. The gross proceeds from the May 20, 2025 Purchase Agreement, before deducting the placement agent fees and offering expenses, were approximately $4,500,000. SeeNote 7–Warrants.

The issuance of shares and pre-funded warrants were recorded at the offering price within equity in accordance with ASC 505,Equity. Any amounts in excess of the par value of the shares were recorded in additional paid-in capital.

$425 Million Offering

On May 26, 2025, the Company entered into a securities purchase agreement for a private placement in public equity (“PIPE”), offering (the “May 2025 PIPE Offering”) an aggregate of (i)58,699,760 shares of Common Stock of the Company, par value $0.0001 per share, at an offering price of $6.15 per share, and (ii) pre-funded warrants to purchase up to an aggregate of 10,400,553 shares of Common Stock at an offering price of $6.1499 per pre-funded warrant. Each of the pre-funded warrants is exercisable for one share of Common Stock at the exercise price of $0.0001 per pre-funded warrant share, immediately exercisable, and may be exercised at any time until all of the pre-funded warrants issued in the May 2025 PIPE Offering are exercised in full. The gross proceeds from the May 2025 PIPE Offering, before deduction the placement agents fees and offering expenses, were approximately $425.0 million funded in a combination of cash and Ether. On June 2, 2025, SharpLink launched its treasury reserve strategy with the commencement of its purchasing of ETH, serving as the Company’s primary treasury reserve asset. Consensys Software Inc. acted as the lead investor in the May 2025 PIPE Offering, along with prominent crypto venture capital firms and infrastructure providers, with an intent to assist the Company in earning distinction as one of the largest ETH-focused treasury strategies in the public markets. The Company also implemented native and liquid staking activities in the second quarter of 2025 to earn staking rewards from the Company’s digital assets held. SeeNote 3–Digital Asset Holdings, Note 7–Warrants and Note 14 - Related Parties.

$200 Million Offering

On August 6, 2025, the Company entered into a securities purchase agreement (the “August Purchase Agreement”) with certain institutional investors to sell in a registered direct offering (the “August Offering”) an aggregate of 10,256,411 shares of the Company’s Common Stock. The price per share was $19.50, and the gross proceeds from the August Offering, before deducting the placement agent fees, financial advisor fees, and offering expenses, were approximately $200 million. In addition, on August 6, 2025, the Company entered into a placement agency agreement (the “August Placement Agency Agreement”) with A.G.P. A.G.P., as lead placement agent and SG Americas Securities, LLC, as co-placement agent (“SocGen,” and together with AGP, the “Placement Agents”), pursuant to which the Company engaged the Placement Agents as the exclusive placement agents in connection with the August Offering. Cantor Fitzgerald & Co. (“Cantor”) acted as financial advisor to the Company pursuant to an engagement letter with the Company. Pursuant to the August Placement Agency Agreement, the Company paid the Placement Agents a cash fee equal to their pro rata allocation of 5.0% of the aggregate gross proceeds raised from the sale of the shares sold in the August Offering. The August Offering closed on August 8, 2025.

$400 Million Offering

On August 10, 2025, the Company entered into a securities purchase agreement (the “Second August Purchase Agreement”) with certain institutional investors to sell in a registered direct offering (the “Second August Offering”) an aggregate of 18,382,353 shares of the Company’s Common Stock. The price per share was $21.76, and the gross proceeds from the Second August Offering, before deducting the placement agent fees, financial advisor fees, and offering expenses, were approximately $400 million. In addition, on August 10, 2025, the Company entered into a placement agency agreement (the “Second August Placement Agency Agreement”) with A.G.P. as the sole placement agent, in connection with the Second August Offering. Pursuant to the Second August Placement Agency Agreement, the Company paid A.G.P. a cash fee equal 2.5% of the aggregate gross proceeds raised from the sale of the shares sold in the Second August Offering. The Second August Offering closed on August 12, 2025.

Approval of Share Repurchase Program

On August 21, 2025, the Board approved a share repurchase program (the “2025 Repurchase Program”) providing for the repurchase of up to $1.5 billion of the Company’s outstanding shares of Common Stock. Under the 2025 Repurchase Program, the Company is authorized to repurchase shares of Common Stock through open market purchases, privately-negotiated transactions, or otherwise in accordance with applicable federal securities laws. The 2025 Repurchase Program does not obligate the Company to repurchase shares of Common Stock, and the specific timing and amount of repurchases will vary based on available capital resources and other financial and operational performance metrics, market conditions, securities law limitations and other factors.

In connection with the 2025 Repurchase Program, on August 21, 2025, the Company entered into an open market share repurchase agreement (the “Repurchase Agreement”) with a broker whereby the broker has agreed to act as a non-exclusive agent on behalf of the Company to repurchase shares of Common Stock in the open market. The Repurchase Agreement will continue in effect until terminated by either the Company or the broker, with or without cause, upon written notice to the other party. We will pay the broker a commission at a rate of $0.01 for each share of common stock repurchased pursuant to the Repurchase Agreement.

During the three and nine months ended September 30, 2025, the Company repurchased 1,938,450 shares of its Common Stock for $31.6 million. All repurchased shares are recorded as treasury stock.

Results of Special Meetings of Stockholders

On July 24, 2025, the Company held a special meeting of the stockholders and received approval for two proposals: (i) adopt an amendment to the Company’s Amended and Restated Certificate of Incorporation, as amended, to increase the number of authorized shares of Common Stock of the Company from 100 million to 500 million; and (ii) to adopt the Company’s Amended and Restated 2023 Equity Incentive Plan to increase the number of shares of Common Stock reserved for issuance thereunder by 8,000,000 to 8,034,166 shares.

On September 25, 2025, the Company held a special meeting of stockholders and received approval for an amendment to the Company’s Certificate of Incorporation to increase the number authorized and outstanding Common Stock from 500,000,000 to 2,500,000,000. The amendment was effective on September 25, 2025. The increase in authorized shares provides additional flexibility to support the Inducement Award Plan, among other initiatives.

Note 10 –Income Taxes

On a quarterly basis, we estimate our annual effective tax rate and record a quarterly income tax provision based on the anticipated rate. As the year progresses, we refine our estimate based on the facts and circumstances, including discrete events, by each tax jurisdiction. The effective tax rate for the nine months ended September 30, 2025 was 105%, primarily due to the full valuation allowance for its deferred tax assets as of September 30, 2025, and the Company recorded a tax provision of $822,000 related to current tax expense for the period ended September 30, 2025. The Company has NOLs available to offset a portion of the current year taxable income, subject to certain limitations. At each reporting period, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. At September 30, 2025, management has determined that there is not sufficient positive evidence to conclude that it is more likely than not that the Company’s net deferred tax asset will be fully realized. The Company is in the process of dissolving certain legal entities to simplify its legal structure. The tax impact of those legal entities being dissolved is not expected to be significant.

We follow the authoritative guidance on accounting for and disclosure of uncertainty in tax positions, which requires us to determine whether a tax position of the Company is more likely than not to be sustained upon examination, including resolution of any related appeals of litigation processes, based on the technical merits of the position. For tax positions meeting the more likely than not threshold, the uncertain tax benefit amount recognized in the financial statements is reduced to the largest benefit that has a greater than 50% likelihood of being realized upon the ultimate settlement with the relevant taxing authority. Interest and penalties related to uncertain tax positions are included in the provision for income taxes in the condensed consolidated statements of operations. In accordance with the Sale of Business (SeeNote 13–Discontinued Operations), management performed an evaluation of the technical merits of the Israeli Controlled Foreign Corporate Rules to determine the taxability of the gain from the Sale of Business from an Israeli tax perspective. This analysis also considered the results of the U.S. income tax. Management determined that the technical merits for uncertain tax exposure resulting from the gain for Israeli tax purposes did not exceed the more-likely-than-not threshold and has not recorded any income tax liability at September 30, 2025. Management’s determination is based on known facts and circumstances and requires judgment of a complex set of rules and regulations. If facts and circumstances change, such as closing, liquidating or selling of the businesses’ equity that is remaining, including events outside the Company’s control, this could have a material impact on the management’s determination.

On July 4, 2025, subsequent to the end of the reporting period, the U.S. federal government enacted theOne Big Beautiful Bill Act (“OBBBA”), which includes significant amendments to the Internal Revenue Code. The Company evaluated the impact of the legislation, and it did not have a material effect on its consolidated financial statements, including deferred tax assets and liabilities.

Note 11 -Commitments and Contingencies

From time to time, the Company may enter into certain types of contracts that require it to indemnify parties against third-party claims. The conditions of these obligations vary. In addition, legal claims may be made against the Company in the ordinary course of business, which could result in legal proceedings. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, which could have a material adverse effect on the Company’s results of operations for that period or future periods.

Historically, the Company has not been obligated to make significant payments for these obligations and does not currently expect to incur any material obligations in the future. Accordingly, the Company has not recorded a contingency liability on its Condensed Balance Sheets as of September 30, 2025 or December 31, 2024.

Note 12–Net Income (Loss) Per Share

Basic net income (loss) per share is calculated by dividing net income (loss) available to common stockholders, adjusted for preferred stock discount accretion and dividends accrued on preferred stock, by the weighted-average number of common shares outstanding during the period excluding the effects of any potentially dilutive securities. Diluted net loss per share is computed similar to basic loss per share, except that the denominator is increased to include the number of additional common stock that would have been outstanding if potential shares of Common Stock had been issued if such additional common stock were dilutive.

As the Company had net income from continuing operations and discontinued operations for the three months ended September 30, 2025 and a net income from continuing operations and net loss from discontinued operations for the nine months ended September 30, 2025, the following presents dilutive and anti-dilutive securities.

For discontinued operations for the nine months ended September 30, 2025, since there was a net loss, all securities presented below were excluded from weighted average shares outstanding. For continuing operations for the three and nine months ended September 30, 2025 and discontinued operations for the three months ended September 30, 2025, dilutive securities presented below were included in the net income per share calculation and the anti-dilutive securities were excluded in weighted average shares outstanding:

As the Company had a net loss from continuing operations and discontinued operations for the three months ended September 30, 2024 and a net loss from continuing operations and net income from discontinued operations for the nine months ended September 30, 2024, the following presents dilutive and anti-dilutive securities. For continuing operations, since there was a net loss, all securities presented below were excluded from weighted average shares outstanding. For discontinued operations, dilutive securities presented below were included in the net income per share calculation and the anti-dilutive securities were excluded in weighted average shares outstanding:

The calculation of the net income (loss) per share and weighted-average shares of the Company’s Common Stock outstanding for the periods presented are as follows:

Note 13–Discontinued Operations

In accordance with ASC 205-20,Presentation of Financial Statements: Discontinued Operations (“ASC 205-20”), a disposal of a component of an entity or a group of components of an entity is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major impact on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-10*.* In the period in which the component meets the held-for-sale or discontinued operations criteria, the major assets, other assets, current liabilities and non-current liabilities shall be reported as a component of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the income (loss) of continuing operations.

The Company is in the process of winding down the operations classified as discontinued and anticipates completing the full dissolution by the end of the first quarter of 2026.

Sale of SHGN and Sports Gaming Client Services

On January 18, 2024*,* SharpLink Israel (“Parent Seller”) and SLG1 Holdings, LLC, a Delaware limited liability company and wholly owned subsidiary of SharpLink (“Subsidiary Seller”), SHGN Acquisition Corp. (“SHGN,” and together with Parent Seller and Subsidiary Seller, the “Seller”), a Delaware corporation and wholly owned subsidiary of SharpLink, entered into a Purchase Agreement (the “PA”) with RSports Interactive, Inc., a Minnesota corporation (“Buyer”). The Subsidiary Seller owns all of the issued and outstanding membership interests of Sports Technologies, LLC, a Minnesota limited liability company, SHGN and Holdings Quinn, LLC, a Delaware limited liability company (collectively referred to as the “Targets”). The PA contemplated the sale of the Company’s Sports Gaming Client Services and SportsHub Gaming Network business units to the Buyer, by selling all of the issued and outstanding membership interests of the Targets and the Acquired Subsidiaries for $22.5 million in an all-cash transaction.

SHGN owns all of the membership interests in Virtual Fantasy Games Acquisitions, LLC , a Minnesota limited liability company; LeagueSafe Management, LLC, a Minnesota limited liability company; SportsHub Reserve, LLC, a Minnesota limited liability company; SportsHub PA, LLC, a Pennsylvania limited liability company; SportsHub Operations, LLC, a Minnesota limited liability company; SportsHub Holdings, LLC, a Minnesota limited liability company; SportsHub Regulatory, LLC, a Minnesota limited liability company; and SportsHub Player Reserve, LLC, a Minnesota limited liability company (collectively, the “Acquired Subsidiaries”).

As a result of the Sale of Business, the Company ceased its Sports Game Client Services and SportsHub Gaming Network segments. The historical results of these business segments have been reflected as discontinued operations in the consolidated financial statements for all periods prior to the closing date of the Sale of Business on January 18, 2024.

On May 8, 2024, SharpLink entered into an amended and fully restated Post Closing Assignment Agreement with RSports, whereby SharpLink and RSports agreed to amend the PA to exclude the transfer/sale of SHGN and agreed to the assignment/sale of the Acquired Subsidiaries membership interests in SHReserve and SHPA to be made directly to RSports upon and subsequent to the approval of a petition by the Pennsylvania Gaming Control Board. Based on this amended agreement, the Sale of Business is an asset sale for legal and tax purposes instead of an equity sale.

The $14.6 million gain was calculated by measuring the difference between the fair value of consideration received less the carrying amount of assets and liabilities sold in accordance with ASC 810.

In the statement of cash flows for the nine months ended September 30 2024, the net cash used in investing activities - discontinued operations is due to cash received from the sale of business of $22.5 million, net of the cash transferred of $41.4 million. The majority of the cash transferred of $41.4 million was reflected in discontinued operations customer deposits liability and deferred revenue of $37.0 million and $4.9 million, respectively.

During the nine months ended September 30, 2025 and 2024, SharpLink paid RSports $8,857 and $132,413, respectively, for use of accounting service personnel under the Post Closing Covenant Agreement (the “PCCA”); and RSports paid SharpLink $1,191 and $75,083 under the PCCA for the nine months ended September 30, 2025 and 2024, respectively. During the three months ended September 30, 2025 and 2024, SharpLink paid RSports $3,000 and $38,816, respectively, for use of accounting service personnel under the PCCA; and RSports paid SharpLink $0 and $21,929 under the PCCA for the three months ended September 30, 2025 and 2024, respectively

Sale of MTS

The Company negotiated a Share and Asset Purchase Agreement which was closed on December 31, 2022. The majority of the assets of the primary reporting unit within MTS were sold. Accordingly, the assets and liabilities of the MTS business were separately reported as assets and liabilities from discontinued operations as of September 30, 2025 and 2024. The results of operations and cash flows of MTS for all periods are separately reported as discontinued operations.

Summary Reconciliation of Discontinued Operations

The following table presents a reconciliation of the carrying amounts of major classes of assets and liabilities of the Company classified as discontinued operations as of September 30, 2025 and December 31, 2024:

Note 14–Related Parties

Strategic Advisory Agreement with Consensys Software Inc.

In connection with the May 2025 PIPE Offering, the Company entered into a Strategic Advisor Agreement with Consensys, a Delaware corporation and a related party. Consensys is a global blockchain technology company that provides decentralized applications and enterprise solutions, focusing on building and scaling blockchain-based systems primarily on the Ethereum blockchain. Under the terms of the agreement, Consensys will provide a broad range of advisory services related to the Company’s ETH Treasury Management strategy for three years. As consideration for these services, Consensys received warrants to purchase up to 3,455,019 shares of the Company’s Common Stock (the “Strategic Advisor Warrants”). SeeNote 7 - Warrants. The Company’s Chairman of the Board, Joseph Lubin, is CEO of Consensys.

Secondment Agreements with Consensys Employees

As part of the collaboration between the Company and Consensys, three employees of Consensys were seconded to SharpLink under secondment agreements. These employees provided key services in areas including strategic planning, treasury management, technology integration and business development. The secondment agreements outline the terms of the assignment, the duration, which began during the month of June 2025 and terminated September 30, 2025, total monthly compensation of approximately $80,000 payable to Consensys and stock-based compensation of a total of approximately $130,000 for RSU’s awarded in September 2025, and the allocation of responsibilities between the parties. The seconded employees remain employees of Consensys, but they performed their duties for the Company during the secondment period and report to the Company’s Co-Chief Executive Officers and Chief Financial Officer. In exchange for these services, the Company compensated Consensys for the associated costs on a monthly basis, including the employees’ salaries, benefits and other related expenses. For the period ended September 30, 2025, approximately $283,000 was expensed in selling, general and administrative expenses and $130,620 was expensed as stock-based compensation in relation to these agreements.

Linea Consortium

The Company is a founding member of the Linea Consortium, along with Consensys, a leading governance body supporting the development of Ethereum's most aligned Layer 2 blockchain network.

Note 15–Subsequent Events

October 2025 Registered Direct Offering

On October 15, 2025, the Company entered into a securities purchase agreement (“October 2025 Purchase Agreement”) with an institutional investor to sell in a registered direct offering (the “October 2025 Offering”) an aggregate of 4,500,000 shares of the Company’s Common Stock. The price per share was $17.00 and the gross proceeds from the October 2025 Offering, before deducting placement agent fees and offering expenses, were approximately $76.5 million. The Company intends to use the net proceeds from the October 2025 Offering to acquire ETH as well as for general working capital purposes. Under the October 2025 Purchase Agreement, the Company also granted the investor 90-day premium purchase contracts, expiring on January 15, 2026, to purchase up to an additional 4,500,000 shares of Common Stock at an exercise price of $17.50 (the “Premium Purchase Contract”). If the Premium Purchase Contracts are fully exercised, the Company will receive an additional $78.8 million in approximate gross proceeds. On October 15, 2025, the Company entered into a placement agent agreement (the “October 2025 Placement Agent Agreement”) with AGP as sole placement agent, pursuant to which the Company engaged AGP as the exclusive placement agent in connection with the October 2025 Offering. Pursuant to the October 2025 Placement Agent Agreement, the Company paid the AGP a cash fee equal to 2.0% of the aggregate gross proceeds raised from the sale of the securities sold in the October 2025 Offering.

Linea Deployment

On October 28, 2025, the Company announced a collaboration to deploy ETH from its corporate treasury onto Linea, a zkEVM Layer 2 network. Based on current negotiations, the Company plans to allocate $200 million in ETH for deployment on Linea in a risk-managed manner over a multi-year commitment period. The Company expects to leverage Linea’s institutional-grade infrastructure to optimize onchain yield to capture differentiated ETH-denominated returns. This differentiated yield is expected to combine native Ethereum yield, restaking rewards from securing EigenCloud Autonomous Verifiable Services (AVSs), and direct Linea and ether.fi partner incentives, all within a compliant Layer 2 infrastructure.

LsETH Redemption

On November 8, 2025, SharpLink unstaked 32,573.83 LsETH, redeeming 35,626.73 ETH at price of $3,400.40 per ETH, totaling approximately $121.1 million. Of the 35,626.73 ETH, 35,330 ETH is a return of ETH originally staked in a liquid staking protocol and 296.72 ETH represents accrued staking rewards earned while staked; All of the redeemed ETH will be returned to the Company’s custodian, Anchorage Digital Bank once the withdrawal process has been completed.