Company: ORBS
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023549
Chunk: 175

Company: Eightco Holdings Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 4
Chunk 175
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 of engaging in DeFi application may not prevent engaging in DeFi pools that are also used by
bad actors.

42

The
Company will face risks relating to the custody of its digital assets. If we or our third-party service providers experience a security
breach or cyberattack and unauthorized parties obtain access to our private keys, or if our private keys are lost or destroyed, or other
similar circumstances or events occur, we may lose some or all of our digital assets and our financial condition and results of operations
could be materially adversely affected.

We
expect our primary counterparty risk with respect to our WLD will be custodian performance obligations under the custody arrangements
we have entered into. A series of recent high-profile bankruptcies, closures, liquidations, regulatory enforcement actions and other
events relating to companies operating in the digital asset industry, the closure or liquidation of certain financial institutions that
provided lending and other services to the digital assets industry, SEC enforcement actions against other providers, or placement into
receivership or civil fraud lawsuit against digital asset industry participants have highlighted the perceived and actual counterparty
risk applicable to digital asset ownership and trading. Legal precedent created in these bankruptcy and other proceedings may increase
the risk of future rulings adverse to our interests in the event one or more of our custodians becomes a debtor in a bankruptcy case
or is the subject of other liquidation, insolvency or similar proceedings.

While
our custodians are subject to regulatory regimes intended to protect customers in the event of a custodial bankruptcy, receivership or
similar insolvency proceeding, no assurance can be provided that our custodially held WLD will not become part of the custodian’s
insolvency estate if one or more of our custodians enters bankruptcy, receivership or similar insolvency proceedings. Additionally, if
we pursue any strategies to create income streams or otherwise generate funds using our WLD holdings, we would become subject to additional
counterparty risks. We will need to carefully evaluate market conditions, including price volatility as well as service provider terms
and market reputations and performance, among others, prior to implementing any such strategy, all of which could affect our ability
to successfully implement and execute on any such future strategy. These risks, along with any significant non-performance by counterparties,
including in particular the custodian or custodians with which we will custody substantially all of our WLD, could have a material adverse
effect on our business, prospects, financial condition, and operating results.