Nakamoto Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2026 (UNAUDITED)

NOTE 1 —ORGANIZATION AND NATURE OF OPERATIONS

Nakamoto Inc., formerly known as KindlyMD, Inc., is, with its subsidiaries, a Bitcoin operating company with media, asset management, and advisory capabilities, together with a bitcoin treasury (“Nakamoto,” “the Company,” “we,” “our,” or “us”). Through its ecosystem-wide presence, Nakamoto seeks to provide investors with exposure to Bitcoin’s global growth.

Nakamoto was formed in 2019 as a healthcare company and we began our transformation into a Bitcoin operating company in August 2025, with the merger between Nakamoto Holdings Inc. (“Nakamoto Holdings”) and KindlyMD, Inc. On December 27, 2025, we converted from a Utah corporation to a Delaware corporation, and on January 21, 2026, we changed our name to Nakamoto Inc.

During the three months ended March 31, 2026, we completed the acquisitions of both (i) BTC Inc. (“BTC Inc”), a Delaware corporation founded in 2012 and headquartered in Nashville, Tennessee, which operates a Bitcoin-focused media and events company that publishes Bitcoin Magazine and produces the Bitcoin Conference, and (ii) UTXO Management GP, LLC (“UTXO”), a Tennessee limited liability company formed in 2019, which serves as the general partner and investment manager of multiple digital asset-focused funds. See Note 3 — Business Combinations for a full description of these transactions and the related accounting.

Reverse Stock Split

On May 22, 2026, we effected a 1-for-40 reverse stock split of our common stock. Every 40 shares of issued and outstanding common stock were reclassified as one share of common stock. The reverse stock split had no impact on the par value of our common stock ($0.001 per share) or the authorized number of shares of common stock. No fractional shares were issued from the reverse stock split. Stockholders who otherwise would be entitled to receive a fractional share in connection with the reverse stock split received a cash payment in lieu thereof. All share and per share information in these condensed consolidated financial statements has been retroactively adjusted to reflect the reverse stock split for all periods.

NOTE 2 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies are described in Note 2 to the audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The following policies are either new to the Company as a result of the BTC Inc and UTXO acquisitions completed during the six months ended June 30, 2026, or have been updated to reflect changes in the current period.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements of Nakamoto have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with Article 8 of Regulation S-X and the related rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). These interim condensed financial statements should be read in conjunction with those audited consolidated financial statements included in the Form 10-K, as filed with the SEC on March 30, 2026 (“Form 10-K”). In the opinion of management, all adjustments considered necessary for a fair presentation of the financial statements, consisting of normal recurring accruals, have been made. Operating results for the three and six months ended June 30, 2026, are not necessarily indicative of the results that may be expected for the entire year.

Reclassifications

Certain reclassifications within the balance sheets and statements of comprehensive loss have been made to the prior period’s financial statements to conform to the current period financial statement presentation. There is no impact in total on the results of operations and cash flows in all periods presented.

Derivative Contracts

We write covered calls and call spreads to generate option premiums and potential economic returns from changes in option values. We also purchase protective puts and put spreads to reduce our mark-to-market exposure to adverse Bitcoin price movements over defined time horizons. These freestanding option contracts meet the definition of derivative instruments under Accounting Standards Codification (“ASC”) 815-10, as each contract has an underlying (the price of Bitcoin) and notional amount, an initial net investment smaller than the full notional exposure, and a net settlement mechanism. In accordance with ASC 815-10, purchased options are recognized as derivative assets and written options are recognized as derivative liabilities on the condensed consolidated balance sheets at trade date. All Bitcoin option contracts are measured initially and subsequently at fair value using Level 1 inputs for exchange-traded contracts.

Consistent with our Bitcoin-focused business strategy, in which the active management of our Bitcoin treasury through option contracts constitutes an ongoing component of our operations, realized and unrealized gains and losses on Bitcoin derivative instruments are presented net within the condensed consolidated statements of comprehensive loss under derivative revenue.

Goodwill

Goodwill represents the excess of the consideration transferred in a business combination over the estimated fair value of the net identifiable assets acquired, and is recorded in accordance with ASC 805,Business Combinations. Goodwill is not amortized. Instead, we test goodwill for impairment at the reporting unit level in accordance with ASC 350,Intangibles – Goodwill and Other. A reporting unit is an operating segment or one level below an operating segment. We test goodwill for impairment annually as of November 1, and between annual tests whenever events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. The goodwill arising from the BTC Inc and UTXO acquisitions has been assigned to our Media & Information Services and Asset Management reporting units, respectively (see Note 3 — Business Combinations).

When testing goodwill, we may first assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test, or we may proceed directly to the quantitative test. Under the quantitative test, we compare the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, we recognize an impairment loss equal to that excess, limited to the total amount of goodwill allocated to the reporting unit. A goodwill impairment loss, once recognized, establishes a new accounting basis and is not reversed in subsequent periods. See Note 6 — Intangible Assets and Goodwill for additional information.

Contract Liabilities

Contract liabilities represent our obligation to transfer goods or services to customers from whom we have received consideration. These primarily relate to consideration we have received for future event sponsorship agreements, ticket purchases for our events, and future consulting and subscription services.

Segments

We identify reporting segments based on how the chief operating decision maker (“CODM”) regularly reviews financial information to allocate resources and assess performance. Our CODM, who is our Chief Executive Officer, reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues and operating income by ourthree reportable segments: Media & Information Services, Asset Management, and Bitcoin Operations. Corporate overhead is reported separately as Other. During the second quarter of 2026, we wound down our legacy healthcare operations and all results are classified as discontinued operations. See Note 11 — Discontinued Operations and Note 13 — Segment Information for additional information.

Revenue Recognition

We recognize revenue in accordance with ASC 606,Revenue from Contracts with Customers. Revenue is recognized upon transfer of control of promised goods or services to customers in an amount that reflects the consideration we expect to receive in exchange for those goods or services. To achieve this core principle, we apply the following five-step approach: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as a performance obligation is satisfied. We apply ASC 606 to the following revenue streams: media, advisory and asset management.

Media Revenue

Media revenue consists of revenue generated from events, digital, and print revenue streams.

Events Revenue: We host conferences and industry gatherings and generate revenue through ticket sales, sponsorships, exhibitor fees, and ancillary services related to our produced events. Revenue from our produced events is recognized when the event occurs, and performance obligations are satisfied. Amounts invoiced or collected in advance of the event are recorded as contract liabilities until the event is completed.

Event sponsorship contracts generally include a bundle of highly interrelated services, such as branding, marketing exposure, booth access, and attendee benefits. We have determined that these promised goods and services are not distinct within the context of the contract, as they are not separately identifiable and do not provide standalone value to the customer. Accordingly, each event sponsorship arrangement is accounted for as a single performance obligation. The transaction price is typically fixed and stated in the contract, and because the contracts include a single performance obligation, no allocation of consideration to individual activities is performed.

In addition to our produced events, we participate in certain international conferences through cooperation or joint venture arrangements with local co-organizers. These arrangements are evaluated under ASC 808,Collaborative Arrangements, as we and our partners are active participants that share risks and rewards. To the extent we provide services under these arrangements that are within the scope of ASC 606, such services are evaluated separately, including an assessment of whether we act as a principal or agent. For these international events, we generally do not control the underlying event operations or locally provided services prior to transfer to customers and therefore act as an agent. Accordingly, revenue is recognized on a net basis for services we provide, such as brand licensing, programming, and agreed-upon sales and marketing services. Revenue is recognized as the related services are performed or, for event-based services, at the time the event occurs, consistent with ASC 606-10-25.

Digital Revenue: We generate revenue through advertising, content syndication, and other services delivered through our online platforms. Digital revenue contracts may include multiple promised services, such as online advertising, newsletter placements, or other sponsored content. Revenue is recognized over the period in which the related digital content is delivered, or as advertising impressions occur, reflecting when the customer receives the benefit. Specifically, website and sponsored content revenue is recognized when the content is published or delivered, and advertising revenue is recognized over the period in which the public outreach is distributed and impressions are delivered. Amounts invoiced or collected in advance of delivery are recorded as contract liabilities and recognized as revenue as the related advertising services are performed.

Print Revenue: We derive print revenue from the sale of physical publications and print advertising. Revenue from the sale of physical publications is recognized upon delivery, when control of the publication transfers to the customer. Print advertising revenue is recognized over the advertising period. Amounts billed or collected in advance of publication or delivery are recorded as contract liabilities and recognized as revenue when the applicable publication is distributed.

Advisory Revenue

We generate advisory revenue through corporate subscription services, consulting engagements, and symposium sponsorships. Corporate subscription contracts provide customers with access to curated Bitcoin research, policy intelligence, and executive education content over a defined contract term, typically ranging from twelve to twenty-four months. These contracts represent a single stand-ready performance obligation satisfied ratably over the subscription period, and revenue is recognized on a straight-line basis over the contract terms in accordance with ASC 606-10-25. Amounts invoiced or collected in advance of the subscription period are recorded as contract liabilities and recognized as revenue as the performance obligation is satisfied.

Consulting revenue is derived from bespoke advisory engagements with corporate clients pursuing Bitcoin treasury and strategy initiatives. Each consulting engagement is evaluated to identify the distinct performance obligations within the contract. Where an engagement comprises a single deliverable or a series of related services that are substantially the same and have the same pattern of transfer, the arrangement is treated as a single performance obligation recognized at the point in time the service is delivered or, where services are rendered over a defined period, ratably over that period. Variable consideration, if any, is estimated using the most likely amount method and included in the transaction price to the extent it is probable that a significant reversal will not occur.

Symposium sponsorship revenue relates to exclusive, invitation-only leadership forums hosted by us, generally for the benefit of Bitcoin for Corporations members. Symposium sponsorship contracts typically include a single performance obligation representing the sponsorship package delivered in connection with the event. Revenue is recognized at the point in time the symposium occurs, consistent with the recognition pattern applied to our other event-based revenue streams. Amounts received in advance of the symposium date are recorded as contract liabilities until the performance obligation is satisfied.

Asset Management Revenue

We provide continuous investment management services to certain funds including 210k Capital, LP (“210k Capital”) and UTXO Bitcoin Ecosystem Master Fund 1 LP (“Bitcoin Ecosystem”) (together, the “Funds”), which include portfolio management, risk monitoring, and consulting. These services represent a single performance obligation that is satisfied over time, consisting of a series of distinct services that are substantially the same and follow the same pattern of transfer. Although we receive two forms of compensation (i.e., management fees and performance fees, as described in more detail below), both relate to the same underlying service of managing the funds and are considered part of the same performance obligation.

Management Fee Income: We earn a management fee for acting as the investment manager for the Funds. The performance obligation is the management of the Funds. While the individual activities that comprise the performance obligation can vary day to day, the nature of the overall performance obligation to provide management services is the same and considered by us to be a series of services that have the same pattern of transfer to the customer and the same method to measure progress toward satisfaction of the performance obligation. The series of distinct services represents a single performance obligation that is satisfied over time. We recognize revenue ratably as the Funds receive and consume the benefits as they are provided by us.

We receive a management fee for our services of up to 2.0% annually of the Net Asset Value (“NAV”) of a limited partner’s capital account for 210k Capital and receive a management fee for our services of generally 2.0% annually of the capital contributions of a limited partner’s capital account for Bitcoin Ecosystem. The management fees for 210k Capital are generally earned on a monthly basis and the management fees for Bitcoin Ecosystem are generally earned on a quarterly basis.

Performance Fee Income: We recognize performance fee income based on each of the Funds’ investment performance. The performance-based income arises from our role as investment manager and General Partner of each of the Funds. The performance obligation is satisfied over time as we achieve specific benchmarks and thresholds through each of the Funds as detailed below.

For 210k Capital, performance fees are generally recognized only when the NAV of a limited partner’s capital account exceeds the highest NAV previously allocated to that account measured at the end of a fiscal year (the “High Water Mark”). If a limited partner experiences a net decrease in the NAV of its respective capital account as of the end of any fiscal year, the amount of the decrease after deduction of management fees, will be carried forward (the “Loss Carryforward”). This Loss Carryforward must be recovered in future periods before a performance allocation is earned.

Subject to the resolution of any Loss Carryforward and the application of the High Water Mark, we are entitled to receive from 210k Capital (i) 20% of the increase in NAV of any Class A limited partner’s capital account and (ii) 15% of the increase in NAV of any Class B limited partner’s capital account, calculated on an annual basis.

Performance fee income from 210k Capital is classified as variable consideration due to its dependency on the limited partner’s NAV. Given the constraint of the High Water Mark and any Loss Carryforward, variable consideration is not recognized until uncertainty is resolved. Once the thresholds are met, we recognize performance fee income.

For Bitcoin Ecosystem, performance fee income (“Carried Interest”) is determined under a distribution waterfall whereby: (i) limited partners first receive distributions equal to their capital contributions; (ii) thereafter, remaining returns are allocated 80% to limited partners and 20% to us until a 3.0x return threshold is reached; (iii) then 75%/25% until a 5.0x return threshold; and (iv) thereafter 70%/30% between limited partners and us.

Carried interest is earned based on the Bitcoin Ecosystem distribution waterfall and is contingent upon the achievement of specified return thresholds. We treat carried interest as variable consideration and recognize it only to the extent it is probable that a significant reversal will not occur, with such assessment performed at each reporting period.

Revenue Outside the Scope of ASC 606 – Derivative Revenue

Income from put and call option contracts on Bitcoin that meet the definition of a derivative instrument is outside the scope of ASC 606 and is accounted for under ASC 815,Derivatives and Hedging. The income is presented as revenue in our condensed consolidated statements of comprehensive loss as we believe it would satisfy the definition (of that term) as included in the ASC master glossary. These derivative contracts are measured at fair value, with realized and unrealized changes in fair value recognized in earnings as they occur. See Note 8 — Derivative Instruments for additional information regarding our derivative instruments.

Debt Modifications

We evaluate amendments to our debt instruments in accordance with ASC 470. When debt is modified or exchanged with an existing lender, we evaluate whether the terms of the new or modified debt are substantially different from the terms of the existing debt. This evaluation generally includes a comparison of the present value of the cash flows under the modified terms with the present value of the remaining cash flows under the original terms.

Discontinued Operations

We account for discontinued operations in accordance with ASC 205-20,Discontinued Operations. We report the disposal of a component, or a group of components, as a discontinued operation when the disposal represents a strategic shift that has, or will have, a major effect on our operations and financial results. A disposal may be effected by sale, by meeting the criteria to be classified as held for sale, or by other means, such as abandonment. The results of operations of a discontinued operation, less applicable income taxes, are reported as a separate component of net loss for all periods presented, and prior periods are retrospectively reclassified to conform to discontinued operations presentation. General corporate overhead is not allocated to discontinued operations. See Note 11 — Discontinued Operations for additional information.

Variable Interest Entities

We hold a variable interest in certain funds including 210k Capital and Bitcoin Ecosystem, which are considered variable interest entities (“VIE”). We consolidate entities that meet the definition of a VIE if we are the primary beneficiary. The primary beneficiary is the party who has the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and who has the right to receive benefits from that entity that could potentially be significant to the entity. We are not considered the primary beneficiary for either 210k Capital or Bitcoin Ecosystem and neither fund is consolidated by us. We hold investments in non-consolidated VIEs totaling $5.4 million and have receivables totaling $0.3 million. Total assets held by the non-consolidated VIEs are approximately $110.5 million.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires the disaggregated disclosure of specific expense categories, including purchases of inventory, employee compensation, depreciation, and amortization included in each relevant expense caption presented on the statement of operations. The standard also requires disclosure of a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, as well as the total amount of selling expenses and an entity’s definition of selling expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. We are currently evaluating the impact this standard will have on our financial statements.

We currently believe there are no other issued and not yet effective accounting standards that are materially relevant to our interim condensed consolidated financial statements.

NOTE 3 —BUSINESS COMBINATIONS

Acquisition of BTC Inc

On February 16, 2026, we entered into an Agreement and Plan of Merger (the “BTC Merger Agreement”) with BTC Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of ours (“BTC Merger Sub”), BTC Inc, and the stockholder representative party thereto.

On February 20, 2026 (the “Closing Date”), we completed the transaction contemplated by the BTC Merger Agreement (the “Closing”), pursuant to which BTC Merger Sub merged with and into BTC Inc, with BTC Inc surviving the merger as a wholly owned subsidiary of ours (the “BTC Merger”). In connection with the Closing, we acquired all of the issued and outstanding securities of BTC Inc.

Concurrently with the BTC Merger, on February 20, 2026, we also completed the acquisition of UTXO (the “UTXO Acquisition”) through the exercise of a call option on UTXO equity interests that was held by BTC Inc and acquired as part of the BTC Merger. See below for further information regarding the UTXO Acquisition.

Upon consummation of the BTC Merger on the terms and conditions set forth in the BTC Merger Agreement, the holders of BTC Inc common and preferred stock received the right to receive 6,497,156 shares of our common stock (“Common Stock”), par value $0.001 per share (“BTC Merger Shares”) and we reserved 1,960,675 shares of Common Stock for issuance in connection with fully-vested BTC Inc stock options assumed by us (“BTC Stock Options” together with the BTC Merger Shares, the “BTC Consideration”).

Pursuant to the BTC Merger Agreement,620,885 shares of our Common Stock were withheld from the BTC Consideration and will be available to offset any post-closing adjustments to the BTC Consideration and to support indemnification obligations (the “BTC Holdback Shares”). Certain stockholders of BTC Inc will receive their pro rata portions of the BTC Holdback Shares subject to the conditions in accordance with the BTC Merger Agreement. All of the remaining 5,876,270 shares of our Common Stock to be issued are dependent upon us receiving a letter of transmittal from previous BTC Inc stockholders (“Letter of Transmittal Shares”). As of June 30, 2026, we have received letters of transmittal representing 5,459,304 shares of Common Stock and have issued shares of Common Stock to those former BTC Inc shareholders. As of June 30, 2026,416,966 Letter of Transmittal Shares remain subject to receipt and subsequent issuance of Common Stock.

Accounting for the BTC Merger

Prior to the Closing Date, we held a call option on the equity interests of BTC Inc, which was accounted for as a derivative instrument measured at fair value with changes in fair value recognized in earnings. On the Closing Date, the call option was remeasured to its acquisition date fair value and applied as consideration in the BTC Merger in accordance with ASC 805.

The components of consideration used to measure goodwill are as follows (in thousands):

Previously Held Call Option

Prior to the Closing Date, we held a call option on the equity interests of BTC Inc, which was accounted for as a derivative instrument in accordance with ASC 815,Derivatives and Hedging, and measured at fair value with changes in fair value recognized in change in fair value of call option – related party in the condensed consolidated statements of comprehensive loss. On December 31, 2025, the fair value of the call option was $199.1 million. During the period from January 1, 2026, through the Closing Date, we recognized a loss of $107.7 million in change in fair value of the call option, reducing the fair value to $91.3 million immediately prior to the Closing Date.

On the Closing Date, the call option was remeasured to its acquisition date fair value and applied as consideration in the BTC Merger and, concurrently through the acquisition of BTC Inc’s call option on UTXO, the UTXO Acquisition. The $91.3 million acquisition date fair value of the call option has been allocated between the two transactions based on the relative fair value of the underlying BTC Inc and UTXO equity interests. Of the total, $45.1 million has been included in the consideration used to measure goodwill in the BTC Merger and $46.2 million has been allocated to the UTXO Acquisition.

The acquisition date fair value of the call option was measured based on the intrinsic value of the option at exercise. The acquisition date fair value of BTC’s equity interests of $128.6 million and the acquisition date fair value of UTXO’s interest of $52.8 million were determined by an independent third-party valuation specialist. As the call option was exercised on the Closing Date with no remaining time value, the intrinsic value approach is consistent with the fair value of the call option under ASC 820. The underlying equity valuations reflect significant unobservable (Level 3) inputs as defined in ASC 820.

Preliminary Purchase Price Allocation – BTC Inc

Our preliminary allocation of the acquisition price is based on our preliminary estimate of fair value for each of the acquired assets and liabilities. Such amounts are subject to revision as additional information about fair values of assets and liabilities becomes available. During the three months ended June 30, 2026, we refined the preliminary estimated fair value of certain net assets acquired primarily including an increase in deferred tax liabilities of $16.5 million, an increase in accounts payable and accrued expenses of $2.1 million, a decrease in intangible assets of $2.0 million and an increase in contract liabilities current of $0.2 million. The offset to these measurement period adjustments was to goodwill, which increased by $20.8 million. We recognized the effect of these measurement period adjustments in the current period and did not revise amounts reported in prior periods. The effect of the adjustment on amortization expense applicable to prior periods was not material. The following table summarizes the preliminary allocation of the fair value of consideration to the assets acquired and liabilities assumed as of the Closing Date (in thousands):

The preliminary fair values and weighted-average useful lives of identifiable intangible assets acquired are as follows (in thousands):

The fair value measurements of intangible assets reflect significant unobservable (Level 3) inputs as defined in ASC 820. No residual value has been assigned to these intangible assets and they do not contain material renewal or extension provisions.

We recognized preliminary goodwill of $91.6 million as a result of the BTC Merger. None of the goodwill recognized is expected to be deductible for income tax purposes. All of the goodwill has been assigned to the Media & Information Services reporting unit.

Revenue and Earnings of BTC Inc Since the Closing Date

The amounts of revenue and pre-tax net loss of BTC Inc, included in our condensed consolidated statement of comprehensive loss from the Closing Date for the three and six months ended June 30, 2026, were as follows (in thousands):

Acquisition of UTXO Management GP, LLC

On February 20, 2026, concurrent with the Closing of the BTC Merger (see above), we completed the UTXO Acquisition. In connection with the Closing, we issued an aggregate of 662,047 shares of Common Stock (the “UTXO Consideration”), of which 66,204 shares were withheld from the UTXO Consideration to support indemnification obligations (the “UTXO Holdback Shares”). Certain equity holders of UTXO will receive their pro rata portion of the UTXO Holdback Shares subject to the conditions in and in accordance with the Agreement and Plan of Merger dated February 16, 2026, by and among Nakamoto, UTXO GP Merger Sub, LLC, a Tennessee limited liability company and a wholly-owned subsidiary of Nakamoto, UTXO, David Bailey, in his individual capacity, Tyler Evans, in his individual capacity, and the equityholder representative party thereto.

Accounting for the UTXO Acquisition

Prior to the Closing Date, we held a call option on the equity interests of BTC Inc, and BTC Inc held a call option on the equity interests of UTXO. Concurrent with the Closing of the BTC Merger, we (through BTC Inc) exercised BTC Inc’s call option on UTXO to complete the UTXO Acquisition. The portion of the acquisition date fair value of our previously held call option on BTC Inc equity interests allocated to the UTXO Acquisition, together with the UTXO Consideration, constitutes the consideration used to measure goodwill in the UTXO Acquisition.

The components of consideration used to measure goodwill are as follows (in thousands):

Preliminary Purchase Price Allocation - UTXO

Our preliminary allocation of the acquisition price is based on our preliminary estimate of fair value for each of the acquired assets and liabilities. Such amounts are subject to revision as additional information about fair values of assets and liabilities becomes available. During the three months ended June 30, 2026, we refined the preliminary estimated fair value of certain net assets primarily including an increase of deferred tax liabilities of $7.4 million, an increase of intangible assets of $0.4 million, a decrease in other current assets of $0.2 million, a decrease in cash of $0.1 million, a decrease in accounts payable and other current liabilities of $0.1 million and a decrease in investments of $0.1 million. The offset to these measurement period adjustments was primarily to goodwill, which increased by $7.3 million. We recognized the effect of this measurement period adjustment in the current period and did not revise amounts reported in prior periods. The effect of the adjustment on amortization expense applicable to prior periods was not material. The following table summarizes the preliminary allocation of the fair value of consideration to the assets acquired and liabilities assumed as of the Closing Date (in thousands):

The preliminary fair values and weighted-average useful lives of identifiable intangible assets acquired are as follows (in thousands):

The fair value measurements of intangible assets reflect significant unobservable (Level 3) inputs as defined in ASC 820. No residual value has been assigned to these intangible assets and they do not contain material renewal or extension provisions.

We recognized preliminary goodwill of $30.0 million as a result of the UTXO Acquisition. None of the goodwill recognized is expected to be deductible for income tax purposes. All of the goodwill has been assigned to the Asset Management reporting unit.

Revenue and Earnings of UTXO Since the Closing Date

The amounts of revenue and pre-tax net loss of UTXO, included in our condensed consolidated statement of comprehensive loss from the Closing Date for the three and six months ended June 30, 2026, were as follows (in thousands):

Acquisition-Related Costs

We incurred acquisition-related costs of $0.0 million and $6.1 million during the three and six months ended June 30, 2026, respectively, related to both the BTC Merger and UTXO Acquisition. The acquisition-related costs consist primarily of advisory, legal, valuation, and due diligence fees, which are included in general and administrative expenses in the condensed consolidated statement of comprehensive loss.

Supplemental Pro Forma Information (Unaudited)

The following unaudited supplemental pro forma information presents our combined results of operations as though the BTC Merger and UTXO Acquisition had occurred on January 1, 2025. The pro forma results reflect adjustments directly attributable to the BTC Merger and UTXO Acquisition that are factually supportable, including additional amortization of acquired intangible assets, reversal of nonrecurring acquisition-related costs and reversal of the portion of the change in fair value of the call option allocated to the BTC Merger and UTXO Acquisition. The pro forma information is not necessarily indicative of results that would have been achieved had the BTC Merger and UTXO Acquisition been completed on January 1, 2025, nor is it indicative of future results (in thousands):

Pro forma net loss for the six months ended June 30, 2026, was adjusted to exclude (i) $6.1 million of acquisition-related costs incurred during the period, (ii) $107.7 million loss on change in fair value of the call option, and (iii) include intangible asset amortization expense prior to the BTC Inc and UTXO acquisitions of $1.4 million.

Pro forma net loss for the six months ended June 30, 2025, was adjusted to include $4.9 million of amortization expense associated with intangible assets acquired in the BTC Inc and UTXO acquisitions.

NOTE 4 —DIGITAL ASSETS

Digital assets consisted of the following on June 30, 2026 (in thousands, except for digital asset units):

As of June 30, 2026,3,805 of our 4,467 Bitcoin were pledged as collateral in connection with an outstanding loan with a third-party lender (see Note 7 — Debt). The pledged Bitcoin cannot be rehypothecated, loaned, or sold by the lender under the terms of the collateral arrangement. The remaining Bitcoin is primarily held with a third-party custodian. All of the Bitcoin is considered under our control.

The fair value of the pledged Bitcoin subject to this contractual sale restriction was approximately $222.7 million. The restriction remains in effect through the partial maturity of the loan on December 4, 2026, and a portion is restricted through the remaining maturity of the loan on June 30, 2027. The restriction would lapse upon full repayment of the outstanding balance.

NOTE 5 —INVESTMENTS

Treasury B.V.

On September 4, 2025, Nakamoto Holdings, our wholly owned subsidiary, made an investment in Treasury B.V. through Stichting Administratiekantoor Treasury, which issued depository receipts representing underlying ordinary shares of Treasury B.V. (the “Minority Investment”).

We own approximately 31.9% of the outstanding equity interests in Stichting and, on a look-through basis, approximately 27.6% of Treasury B.V. Based on our ownership interest and governance rights obtained through the Minority Investment, we have concluded that we have the ability to exercise significant influence over Treasury’s operating and financial policies. Accordingly, we account for our investment under the equity method in accordance with ASC 323.

Under the equity method, we recognize our proportionate share of Treasury B.V.’s net income or loss in our Bitcoin Operations reportable segment on a one-quarter lag based on financial information provided by Treasury B.V.

For the three and six months ended June 30, 2026, we recorded an equity method loss of $1.8 million and $5.8 million, respectively, in (gain) loss on investments in the condensed consolidated statements of comprehensive loss. In addition, we recorded a foreign currency translation loss of $0.1 million and $0.2 million, respectively, which is included in other comprehensive loss in the condensed consolidated statements of comprehensive loss.

As of June 30, 2026, the carrying amount of our investment is $8.9 million.

Metaplanet Inc.

During the three and six months ended June 30, 2026, we recognized a total realized and unrealized loss on our investment in Metaplanet stock of $0.0 million and $3.9 million, respectively, which is included in (gain) loss on investments on the condensed consolidated statements of comprehensive loss.

During the six months ended June 30, 2026, we sold 5.0 million shares of Metaplanet stock, at a weighted-average fair value of $2.26 per share, generating net cash proceeds of $11.1 million after fees. On June 1, 2026, we contributed our remaining 3.0 million shares of Metaplanet stock to 210k Capital and received a limited partnership interest in 210k Capital. The fair value of the Metaplanet stock at the time of contribution was $5.5 million. These transactions resulted in a realized loss for the three and six months ended June 30, 2026, of $5.8 million and $13.2 million, respectively.

We accounted for our investment in Metaplanet stock at fair value, with the changes in fair value recognized in net income in accordance with ASC 321, as the shares had a readily determinable fair value based on quoted market prices on the Tokyo Stock Exchange. As of June 30, 2026, we no longer held any shares in Metaplanet.

210k Capital

On June 1, 2026, we contributed our investment in Metaplanet to 210k Capital and in return received a limited partnership interest in 210k Capital. The initial investment was valued at $5.5 million on June 1, 2026. We account for our investment in 210k Capital based on the net asset value of the 210k Capital fund. We can generally redeem our investment in 210k Capital at the end of any calendar quarter with at least 60 days prior notice.

During the three months and six months ended June 30, 2026, we recorded an unrealized loss of $0.3 million on our investment in the 210k Capital fund, which is included in (gain) loss on investments on the condensed consolidated statements of comprehensive loss. As of June 30, 2026, we own approximately 5.8% of the 210k Capital fund and the carrying amount of our investment is $5.2 million.

RTB Digital

As part of the BTC Inc acquisition, we acquired a minority equity investment in Roundtable Media, LLC (“Roundtable Media”) that was valued at $0.3 million. On May 13, 2026, Roundtable Media completed a reverse merger with RYVYL Inc. and began trading as RTB Digital, Inc. (“RTB Digital”) on Nasdaq. We received shares of the newly public company and own approximately 1.6% of RTB Digital. Our shares in RTB Digital have transfer restrictions that are released in four equal tranches of 25% on May 13, 2027, August 13, 2027, November 13, 2027, and February 13, 2028.

During the three and six months ended June 30, 2026, we recorded an unrealized gain of $2.9 million, which is included in (gain) loss on investments on the condensed consolidated statements of comprehensive loss. As of June 30, 2026, our investment in RTB Digital had a carrying amount of $3.2 million.

NOTE 6 —INTANGIBLE ASSETS AND GOODWILL

Definite-lived Intangible Assets

Our definite-lived intangible assets consist of trade names, management contracts and customer relationships, all of which are subject to amortization over their estimated useful life.

The following table presents the gross carrying amount, accumulated amortization, and net carrying amount of intangible assets as of June 30, 2026 (in thousands):

The gross carrying amount of the above definite-lived intangible assets reflects a measurement period adjustment recorded during the three months ended June 30, 2026, that decreased the preliminary estimated fair value assigned to identifiable intangible assets by an aggregate of $1.6 million (see Note 3 — Business Combinations). Accumulated amortization reflects amortization on the revised basis as if the adjustment had been recognized as of the acquisition date.

Amortization expense for intangible assets was $2.4 million and $3.5 million, respectively, for the three and six months ended June 30, 2026, and is included in depreciation and amortization expense in the condensed consolidated statements of comprehensive loss.

Estimated aggregate amortization expense for intangible assets as of June 30, 2026, is as follows (in thousands):

Indefinite-lived Intangible Assets

Our indefinite-lived intangible assets consist of a domain name with a carrying amount of $3.0 million as of June 30, 2026. The asset is not subject to amortization and is evaluated for impairment annually or more frequently if events or changes in circumstances indicate that it may be impaired. There was no impairment recognized during the three and six months ended June 30, 2026.

The changes in the carrying amount of goodwill for the six months ended June 30, 2026, are as follows (in thousands):

Goodwill recognized during the six months ended June 30, 2026, relates to acquisitions described in Note 3 — Business Combinations, and is preliminary while the measurement period remains open. During the three months ended June 30, 2026, goodwill increased by $28.1 million as a result of measurement period adjustments to the preliminary estimated fair value of net assets acquired in the BTC Inc and UTXO acquisitions (see Note 3 — Business Combinations). We recognized this adjustment in the current period and did not revise amounts reported in prior periods.

We evaluate goodwill for impairment annually on November 1, or more frequently if events or changes in circumstances indicate that the asset may be impaired. On June 30, 2026, we tested both the Media & Information Services and Asset Management reporting unit goodwill balances for impairment due primarily to sustained decreases in our stock price and market capitalization as well as a decrease in the price of Bitcoin. As a result of the goodwill impairment tests, we recognized total goodwill impairment for the three and six months ended June 30, 2026, of $105.2 million, which is included in impairment of goodwill in the condensed consolidated statements of comprehensive loss.

Within our Media & Information Services reporting unit, we recorded a goodwill impairment of $80.6 million in the three and six months ended June 30, 2026. The reduction in value was primarily due to lower forecasted operating results as a result of the decline in Bitcoin price and a higher discount rate. The fair value of the Media & Information Services reporting unit was determined based on both income and market approaches. Significant assumptions used in the determination of the fair value include revenue growth, EBITDA margin, discount rate, terminal growth rate, and revenue and earnings multiples. As of June 30, 2026, the amount of goodwill after our impairment was $11.0 million for our Media & Information Services reporting unit.

Within our Asset Management reporting unit, we recorded a goodwill impairment of $24.6 million in the three and six months ended June 30, 2026. The reduction in value was primarily due to lower forecasted operating results as a result of the decline in Bitcoin price and a higher discount rate. The fair value of the Asset Management reporting unit was determined based on both income and market approaches. Significant assumptions used in the determination of the fair value include revenue growth, EBITDA margin, discount rate, terminal growth rate, and revenue multiples. As of June 30, 2026, the amount of goodwill after our impairment was $5.4 million for our Asset Management reporting unit.

NOTE 7 —DEBT

Our outstanding debt as of June 30, 2026, is $164.7 million and consists of a 60.0 million USDT note payable due to Payward Interactive, Inc. (“Kraken”) on December 4, 2026, and a 105.0 million USDT note payable due to Kraken on June 30, 2027.

On January 30, 2026, we entered into the First Amendment to the Master Loan Agreement (“MLA Amendment”), which amends the previous Master Loan Agreement, dated as of December 3, 2025 (the “Master Loan Agreement”) by and between Nakamoto Holdings and Kraken. The MLA Amendment amends the Master Loan Agreement (the “Amended Master Loan Agreement”) to permit the funding of a designated trading wallet maintained at Kraken (the “Trading Wallet”) and to clarify that the Trading Wallet shall serve as collateral for both the obligations under the Master Loan Agreement and obligations (if any) resulting from trading activity conducted through such wallet.

On February 5, 2026, we pledged an additional 688 Bitcoin as collateral under the Master Loan Agreement to satisfy collateral maintenance requirements (see Note 4 — Digital Assets).

On June 5, 2026, Nakamoto Holdings and Kraken executed a loan term sheet (the “Restructured Loan Term Sheet”) under that certain Master Loan Agreement. The Restructured Loan Term Sheet supersedes in its entirety the loan term sheet, dated as of December 9, 2025, by and between Nakamoto Holdings and Kraken (the “December Term Sheet”), and the loans issued under the December Term Sheet were deemed repaid and the outstanding principal balance thereunder was deemed to be transferred to Nakamoto Holdings, without the need for any notice or actual transfer of loaned digital currency. Pursuant to the Restructured Loan Term Sheet, Nakamoto Holdings borrowed a fixed-term loan in a principal amount of 210.0 million USDT (the “Restructured Loan”). The Restructured Loan was scheduled to mature in two tranches:105.0 million USDT of the outstanding principal amount was to mature on December 4, 2026, and the remaining 105.0 million USDT was to mature on June 30, 2027.

On June 5, 2026, Nakamoto Holdings repaid 45.0 million USDT to reduce the outstanding principal amount of the Restructured Loan from 210.0 million USDT to 165.0 million USDT (the “Partial Repayment”).

To fund the Partial Repayment, Nakamoto Holdings sold approximately 600 Bitcoin for 35.6 million USDT and certain Bitcoin derivative contracts, generating approximately $48.0 million in net proceeds, and applied $45.0 million of those proceeds to the Partial Repayment.

Following the Partial Repayment, Nakamoto Holdings and Kraken entered into a subsequent loan term sheet on June 5, 2026 (the “June Term Sheet”), under the Master Loan Agreement. The June Term Sheet supersedes in its entirety the Restructured Loan Term Sheet, and the loans issued under the Restructured Loan Term Sheet are deemed repaid and the outstanding principal balance thereunder is deemed to be transferred to Nakamoto Holdings pursuant to the June Term Sheet, without the need for any notice or actual transfer of loaned digital currency. Pursuant to the June Term Sheet, Nakamoto Holdings borrowed a fixed-term loan in a principal amount of 165.0 million USDT (the “June Loan”), which reflects the reduced principal balance of the Restructured Loan following the Partial Repayment. The June Loan matures in two tranches:60.0 million USDT of the outstanding principal amount matures on December 4, 2026, and the remaining 105.0 million USDT matures on June 30, 2027.

The June Loan bears a loan fee of(i) 7.75% per annum during any period in which Nakamoto Holdings holds at least 2,000 Bitcoin in a designated Bitcoin yield strategy collateral account (the “Trading Wallet”), and (ii) 8.00% per annum during any period in which Nakamoto Holdings holds less than 2,000 Bitcoin in the Trading Wallet. The June Loan is secured solely by Bitcoin pledged by Nakamoto Holdings to Kraken and the initial collateral required to secure the June Loan was 3,805 Bitcoin. Nakamoto Holdings has the right to paydown the June Loan, in whole or in part, upon 30 days’ prior written notice to Kraken, with no early return penalty.

We evaluated the June 5, 2026, transactions under ASC 470-50 and ASC 470-60 and concluded that they are considered a debt modification. We accounted for the 45.0 million USDT repayment as a partial extinguishment of the Restructured Loan, with no gain or loss recognized.

NOTE 8 —DERIVATIVE INSTRUMENTS

We write covered calls and call spreads to generate option premiums and potential economic returns from changes in option values. We also purchase protective puts and put spreads to reduce our mark-to-market exposure to adverse Bitcoin price movements over defined time horizons. These instruments are not designated as hedging instruments and are carried at fair value, with changes in fair value recognized in earnings within derivative revenue.

The following table presents the fair value of our Bitcoin derivative instruments as of June 30, 2026 (dollars in thousands):

For the three and six months ended June 30, 2026, we recognized a net gain of $10.4 million and $11.5 million, respectively, related to Bitcoin option contracts within derivative revenue on the condensed consolidated statements of comprehensive loss.

NOTE 9 —FAIR VALUE MEASUREMENTS

We measure certain assets and liabilities at fair value on a recurring basis in accordance with ASC 820,Fair Value Measurements.

The following table presents the fair value hierarchy of our assets and liabilities measured at fair value as of June 30, 2026 (in thousands):

Level 1 inputs consist of quoted prices in active markets for identical assets. There were no transfers between levels of the fair value hierarchy during the six months ended June 30, 2026.

The following table presents the changes in Level 3 assets measured at fair value for the six months ended June 30, 2026 (in thousands):

The fair value of our notes payable approximates our carrying value as the interest rates are consistent with current market rates.

NOTE 10 —REVENUE FROM CONTRACTS WITH CUSTOMERS

Our revenues are disaggregated based on revenue type, including (i) media, (ii) advisory services, (iii) asset management, and (iv) derivatives.

Our net revenues for the three and six months ended June 30, 2026, are disaggregated as follows (in thousands):

The disaggregation of revenue from contracts with customers presented above reflects revenue from continuing operations. Revenue from the legacy Healthcare Operations segment, which has been presented as a discontinued operation for all periods presented, is excluded from the tables above. For additional information on discontinued operations, see Note 11 — Discontinued Operations.

Contract Liabilities

Contract liabilities represent consideration received from customers in advance of our satisfaction of performance obligations and are recognized as revenue when control of the promised goods or services is transferred to customers.

The following table presents the changes in contract liabilities for the six months ended June 30, 2026 (in thousands):

Contract liabilities in the acquisition represent deferred revenue from the acquired business and were recorded in connection with the acquisition of BTC Inc. See Note 3 — Business Combinations for further details. Approximately $18.0 million of the total $24.0 million of revenue recognized during the six months ended June 30, 2026, related to contract liabilities assumed in the BTC Merger.

Remaining Performance Obligations

As of June 30, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $7.2 million. We expect to recognize approximately $3.4 million of this revenue over the next 12 months and the remainder thereafter over the contractual terms of the underlying arrangements, which generally range from 1 –2 years.

NOTE 11 —DISCONTINUED OPERATIONS

During the second quarter of 2026, we shut down our healthcare operations, which historically generated revenue from providing outpatient services through clinics and telemedicine platforms. The decision was made in connection with our strategic shift towards the development of a scalable, Bitcoin-native operating business.

We evaluated whether the healthcare operations met the held-for-sale criteria in ASC 205-20-45-1E and concluded they did not, principally because the business was never probable to be sold. We then evaluated the disposal under the guidance in ASC 205-20-45-1B(c) for disposals other than by sale and considered the healthcare operations to be held and used until the date of abandonment in accordance with ASC 360-10-45-15. We concluded that the date of abandonment occurred as of June 19, 2026, when the last healthcare clinic was closed.

The shutdown of the healthcare operations represents a strategic shift that has a major effect on our operations and financial results as all of our revenues in 2025 were from healthcare operations, all of our activities prior to the August 2025 merger with Nakamoto Holdings were healthcare related and the results of healthcare operations were previously reported as one of our reportable operating segments.

The loss recognized on the disposal of the healthcare operations includes the impairment of the right-of-use assets associated with the abandoned leases recorded in the first three months of 2026, together with severance and employee termination costs and other disposal related costs recognized through the date of abandonment. These expenses of $1.2 million and $1.7 million for the three and six months ended June 30, 2026, respectively, are presented within net loss from discontinued operations on the condensed consolidated statement of comprehensive loss.

The healthcare operations were previously reported within our Healthcare Operations segment. As a result of the disposal, the Healthcare Operations segment is no longer presented as a continuing operation, see Note 13 — Segment Information. The results for the healthcare operations have been retrospectively reclassified and presented as discontinued operations for all periods presented in our condensed consolidated statement of comprehensive loss. Prior to the merger with Nakamoto Holdings in August 2025, we operated a single operating segment consisting of Healthcare Operations. All operating expenses prior to the merger with Nakamoto Holdings were previously reflected in Healthcare Operations. General corporate overhead incurred during the three and six months ended June 30, 2025, that was not directly attributable to healthcare operations was not material. Accordingly, we report no results from continuing operations for the three and six months ended June 30, 2025.

The following table presents the pretax loss and the major classes of line items constituting the pretax loss of the discontinued operations for the three and six months ended June 30, 2026, and 2025 (in thousands).

There isno income tax expense or benefit for the three and six months ended June 30, 2026, and 2025.

NOTE 12 —RELATED PARTY TRANSACTIONS

As described in Note 3 — Business Combinations, we acquired BTC Inc and UTXO during February 2026. BTC Inc and UTXO were considered related parties of Nakamoto as David Bailey, our Chief Executive Officer and Chairman of the Board of Directors and Tyler Evans, our Chief Investment Officer and a member of our Board of Directors, each had significant influence over BTC Inc and UTXO through their prior ownership of and leadership positions within BTC Inc and UTXO. In connection with the review and approval of the BTC Inc and UTXO acquisitions, our Board of Directors formed a special committee comprised only of independent and disinterested directors of our Board.

As discussed further in Note 2 — Summary of Significant Accounting Policies, we earn management and performance fees from management services provided to both 210k Capital and Bitcoin Ecosystem funds. During the three and six months ended June 30, 2026, we earned management fees from both Funds totaling $0.4 million and $0.6 million, respectively. During the six months ended June 30, 2026, we have received total payments of management fees of $0.6 million from both Funds and shares of Metaplanet with a fair value of $0.7 million from 210k Capital relating to pre-UTXO Acquisition redemption. As of June 30, 2026, we have an investment in the 210k Capital fund of $5.2 million and an investment in the Bitcoin Ecosystem fund of$0.2 million. We have receivables totaling $0.3 million from funds that we manage.

In the six months ended June 30, 2026, we received approximately $0.9 million from Metaplanet for event sponsorship and Bitcoin for Corporations membership. We also received $0.4 million from Treasury B.V. in the six months ended June 30, 2026, for fees to terminate certain contractual agreements. In the three and six months ended June 30, 2026, we recorded approximately $1.1 million of revenue related to Metaplanet event sponsorship and Treasury B.V. fees to terminate contractual agreements. In the three months ended June 30, 2026, we entered into an agreement with Metaplanet for BTC Inc to provide future event production services.

During the six months ended June 30, 2026, we incurred approximately $0.1 million included in General and administrative expenses in the condensed consolidated statements of comprehensive loss with BTC Inc under a marketing and services agreement in which BTC Inc provided marketing and other administrative support prior to the BTC Merger. We paid BTC Inc $0.6 million prior to the BTC Merger for prior marketing and other administrative support.

During the six months ended June 30, 2026, we paid David Bailey approximately $1.4 million to pay down liabilities associated with pre-BTC Merger distributions declared and $0.1 million relating to funding provided to UTXO prior to the UTXO Acquisition. During the same period, we paid Tyler Evans approximately $0.2 million to pay down liabilities associated with pre-BTC Merger distributions declared, $0.1 million relating to funding provided to UTXO prior to the UTXO Acquisition and distributed shares of Metaplanet with a fair value of $0.7 million relating to a pre-UTXO Acquisition distribution liability.

During the six months ended June 30, 2026, we paid approximately $2.7 million in total to Calli Bailey and Charles Bailey to pay down liabilities associated with pre-BTC Merger distributions declared. During the same period, we paid approximately $0.3 million to the BTC Merger Stockholder Representative, Calli Bailey. The funds paid to the BTC Merger Stockholder Representative are to be used for any expenses the Stockholder Representative incurs, and any remaining funds are then distributed to the prior BTC Inc shareholders.

NOTE 13 —SEGMENT INFORMATION

During the six months ended June 30, 2026, we updated our reportable segments that were primarily driven by acquisitions completed during the period (see Note 3**—** Business Combinations). We now operate three reportable segments: Media & Information Services, Asset Management and Bitcoin Operations.

We evaluate segment performance based on operating income (loss), which represents operating revenues less operating expenses attributable to each segment.

The following table represents segment results for the three months ended June 30, 2026 (in thousands):

The following table represents segment results for the six months ended June 30, 2026 (in thousands):

The following table reconciles our segment operating loss to net loss from continuing operations before benefit from income taxes for the three and six months ended June 30, 2026 (in thousands):

The following table represents assets by segment as of June 30, 2026, and December 31, 2025 (in thousands):

The following table reconciles our total assets by reportable segment to total consolidated assets as of June 30, 2026, and December 31, 2025 (in thousands):

NOTE 14 —SUBSEQUENT EVENTS

On August 3, 2026, Tim Pickett resigned from all positions with the Company and its affiliates, including as Chief Medical Officer and a director of the Company. In connection with his resignation, the Company and Mr. Pickett entered into a Separation Agreement and Release under which the Company agreed to pay a gross cash separation payment of approximately $0.9 million.