Company: FWDI
Filing Date: 2025-11-10
Form Type: 424B5
Source: 0001683168-25-008141
Chunk: 66

Company: Forward Industries, Inc.
Filing Date: 2025-11-10
Form: 424B5
Chunk 66
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 Solana’s consensus mechanism (Proof of History combined with Proof of Stake) is novel and relatively untested at a large
scale over time. Structural flaws could emerge that require a fork, which may have an adverse impact on the Solana network and our holdings.

Solana validators are relatively small in number, compared to some other leading blockchains, which may lead to coordinated censorship.

Solana has fewer validators than certain other blockchains
but has a high Nakamoto coefficient, which refers to the minimum number of validators or node operators that need to cooperate to take
over a blockchain network. In contrast, Ethereum has a higher number of validators. In theory, a malicious actor might more easily be
able to gain control of a network with fewer validators. Such control of the network could allow a malicious actor to censor transactions,
reverse transactions (double-spending), or manipulate block validations.

Solana is subject to technological obsolescence, including competition from emerging blockchain and artificial intelligence protocols.

The digital asset ecosystem is characterized by rapid
technological innovation, short development cycles, and intense competition among blockchains and related infrastructure providers. Solana
faces intense competition among existing protocols, such as Aptos, Hyperliquid, Sei and Sui, the Ethereum Layer 2 blockchains such as
Base, and new entrants that are currently being developed. Competitors may in the future offer superior scalability, security, interoperability,
decentralization, programmability and adoption, and may attract developers away from the Solana ecosystem. Advancements in AI and blockchain
technology are likely to accelerate the development of such protocols, including the development of additional networks that natively
integrate AI into consensus mechanisms and other core features. If Solana is unable to evolve to address such increased competition or
if market participants believe that Solana’s core technology stack is outdated or less attractive compared with other blockchain
networks, Solana may be considered technologically obsolete by the next generation of protocols. The decline in the Solana network would
materially impact the market value of SOL and adversely affect the value of our SOL treasury holdings and our stock price.

The Company may be subject to additional tax liability if regulation or policy changes adversely affect the tax treatment of rewards from staking SOL.

The U.S. federal income tax treatment of rewards
from staking digital assets such as SOL or utilizing liquid staking tokens remains uncertain and is currently the subject of debate and
regulatory attention. Under current guidance by the Internal Revenue Service (“IRS”), staking rewards and