Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 286

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1A
Chunk 286
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 subject to regulation and supervision by the New York Department
of Financial Services. In addition, the Bitcoin Service Providers are subject to regulation and supervision by many other state banking
and financial institution regulators (individually and collectively, “State Banking Departments”). Many laws and regulations
that apply directly to the Bitcoin Service Providers indirectly impact us (and our products) as a partner of the Bitcoin Service Providers.
As such, our partnerships with the Bitcoin Service Providers may be subject to the supervision and enforcement authority of the State
Banking Departments.

Our customers enter into agreements directly with Sutton Bank
and our Bitcoin Service Providers.

Our customers enter into agreements for banking
services directly with Sutton Bank, and enter into agreements for Bitcoin-related services directly with one or more of the Bitcoin Service
Providers. Our third-party service providers have not agreed to indemnify us for losses based on their breaches of their agreements with
our customers. Although our terms of use clearly state that we are not responsible for the services provided by those third parties, it
is possible that customers could blame us for a failure by one of those third parties to fulfill its obligations. This could have a material
adverse impact on our reputation and business.

We are subject to risks related to the banking and financial
services ecosystem, and to our banking and crypto service providers specifically.

Volatility in the banking and financial services
sectors and regulatory enforcements by the FDIC or other regulators may impact our bank partnerships and could negatively impact our business.
For example, we offer certain FDIC-insured products through our partnership with Sutton Bank, a member of the FDIC, and if the FDIC were
to seek to enter into an enforcement action against Sutton Bank, it may adversely impact our business or relationship with Sutton Bank.
For example, in February 2024, Sutton Bank became subject to an FDIC enforcement order that, among other things, required Sutton
Bank to correct certain banking practices and within 60 days devise a plan to review all prepaid card customers since July 1,
2020 for compliance with anti-money laundering requirements. Similarly, for certain Bitcoin related services, we partner with the Bitcoin
Service Providers, which are regulated by various federal and state regulators, and if such regulators were to enter into an enforcement
action against either of the Bitcoin Service Providers, it may adversely impact our business or relationship with them. In addition, although
we believe our banking and financial services programs comply with all applicable law, if Sutton Bank or Bitcoin Service Providers fail
to comply with applicable law