Company: FWDI
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001683168-25-009068
Chunk: 24

Company: Forward Industries, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 1
Chunk 24
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 asset service providers or through “unhosted” wallets
that expose the investor to risks associated with loss or hacking of their private keys. Given the relative novelty of digital assets,
general lack of familiarity with the processes needed to hold SOL directly, as well as the potential reluctance of financial planners
and advisers to recommend direct SOL holdings to their retail customers, some investors have sought exposure to bitcoin, SOL and other
digital assets through investment vehicles that hold bitcoin, SOL and other digital assets and issue shares representing fractional undivided
interests in their underlying digital asset holdings. These vehicles, which were previously offered only to “accredited investors”
on a private placement basis.

In October of 2025, the SEC approved
the listing and trading of spot SOL exchange-traded products (“ETPs”), the shares of which can be sold in public offerings
and are traded on U.S. national securities exchanges. The first approved SOL ETP commenced trading directly to the public on October 28,
2025, with a trading volume of approximately $55 million on the first trading day and had the highest launch day inflows of any ETP launched
in 2025. The value of our common stock may decline due to investors having a greater range of options to gain exposure to SOL now that
SOL ETPs are approved and investors may prefer to gain such exposure through ETPs rather than our common stock. The listing and trading
of spot ETPs for SOL or other digital assets offers investors another alternative to gain exposure to digital assets, which could result
in a decline in the trading price of SOL as well as a decline in the value of our common stock relative to the value of our SOL.

As a result of the foregoing
factors, the availability of spot ETPs for SOL and other digital assets could have a material adverse effect on the market price of our
listed securities.

Digital asset lending arrangements may expose
us to risks of borrower default, operational failures and cybersecurity threats.

From time to time, we may generate
income through lending digital assets, which carries significant risks. The volatility of such digital assets increases the likelihood
that borrowers may default due to market downturns, liquidity crises, fraud or other financial distress. These lending transactions may
be unsecured and therefore may be subordinated to the secured debt of the borrower in the event of the borrower’s bankruptcy or
insolvency. If a borrower becomes insolvent, we may be unable to recover the loaned SOL, leading to substantial financial losses.