Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 62

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 62
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 experience
temporary process-related withdrawal delays. For example, like traditional financial institutions, our Bitcoin Service Providers may experience
such delays if there is a significant volume of withdrawal requests that is vastly beyond anticipated levels. This does not mean our Bitcoin
Service Providers cannot or will not satisfy withdrawals, but this may mean a temporary delay in satisfying withdrawal requests, which
our customers still expect to be satisfied within the withdrawal timelines set forth in the applicable user agreements or otherwise communicated
by us or our Bitcoin Service Providers. To the extent we or one of our Bitcoin Service Providers have process-related delays, even if
brief or due to blockchain network congestion or heightened redemption activity, and within the terms of an applicable user agreement
or otherwise communicated by us, we may experience increased customer complaints and damage to our brand and reputation and face additional
regulatory scrutiny, any of which could adversely affect our business.

A temporary or permanent blockchain “fork” to Bitcoin
could adversely affect our business.

Blockchain protocols, including Bitcoin, are open
source. Any user can download the software, modify it, and then propose that Bitcoin users and miners adopt the modification. When a modification
is introduced and a substantial majority of users and miners consent to the modification, the change is implemented and the Bitcoin protocol
network remains uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed modification,
and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a “fork”
(i.e., “split”) of the impacted blockchain protocol network and respective blockchain, with one prong running the pre-modified
software and the other running the modified software. The effect of such a fork would be the existence of two parallel versions of the
Bitcoin protocols running simultaneously, but with each split network’s Bitcoin lacking interchangeability.

Bitcoin has previously been subject to “forks”
that resulted in the creation of new networks, including Bitcoin Cash ABC, Bitcoin Cash SV, Bitcoin Diamond, Bitcoin Gold, and others.
Some of these forks have caused fragmentation among platforms as to the correct naming convention for forked crypto assets. Due to the
lack of a central registry or rulemaking body, no single entity has the ability to dictate the nomenclature of forked crypto assets, causing
disagreements and a lack of uniformity among platforms on the nomenclature of forked crypto assets, and which results in further confusion
to customers as to the nature of assets they hold on platforms. In addition, several of