Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 12

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 12
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 over the last 15 years will continue
with potential to accelerate, providing attractive value growth opportunities.

8

As of December 31, 2024, Fold has accumulated more than 1,000
bitcoin in our Investment Treasury, and we plan to continue to accumulate bitcoin over time. We view our bitcoin holdings as a long-term
strategic investment and not as a trading asset. We believe holding bitcoin on our corporate balance sheet has the potential to provide
stockholder value for several reasons:

Price appreciation: Bitcoin
has experienced meaningful price appreciation over the past decade, significantly outperforming the S&P 500, US treasury yields, and
other traditional investments over the same time frame. We believe bitcoin adoption will continue to grow rapidly over the coming years,
which has potential to provide an opportunity for continued price appreciation.

Inflation hedge: Bitcoin,
with its capped supply, has the potential to serve as a long-term hedge against inflation. We expect central banks to continue to devalue
fiat currencies over the near term through inflationary monetary policies.

Diversification: Bitcoin
often shows low correlation with traditional financial assets like stocks, bonds, and commodities, offering diversification benefits to
the overall portfolio.

Liquidity: Unlike
traditional financial markets, the market for bitcoin operates 24/7, offering constant access to liquidity.

Enhanced brand perception: Companies
investing in bitcoin may be viewed by certain consumers as more forward-thinking, appealing to progressive, tech-savvy consumers and investors.

Balance sheet management: We
believe building a solid balance sheet with potential for growth will provide a solid foundation for us to better operate and grow our
business over time.

These factors suggest strategic benefits for Fold
incorporating bitcoin into our financial strategies, aligning with modern financial trends and technological advancements.

Flywheel Effect

We expect demand for bitcoin financial services
to continue to increase over time, and Fold has positioned itself as a first mover to benefit from this acceleration. As the bitcoin network
expands, we believe demand for our services will grow, fueling a cycle where we build more financial products to meet consumer needs,
further increasing our cash flows, our bitcoin treasury, and the bitcoin holdings of our customers. This flywheel, powered by aligned
incentives and our first-mover advantage, positions Fold to capitalize on Bitcoin’s rapid growth and increasing value.

Our Growth Strategy

Fold aims to grow alongside the emerging bitcoin economy.

9

We believe we are in the early stages of realizing