Company: WKSP
Filing Date: 2025-03-28
Form Type: S-1
Source: 0001641172-25-001309
Chunk: 41

Company: Worksport Ltd
Filing Date: 2025-03-28
Form: S-1
Chunk 41
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 we would have to register as an investment company, and the additional regulatory restrictions imposed
by 1940 Act could adversely affect the market price of bitcoin or XRP and in turn adversely affect the market price of our common stock.

We may be subject to regulatory developments related to crypto assets and crypto asset markets, which could adversely affect our business, financial condition, and results of operations.

As bitcoin, XRP and other digital assets are relatively
novel and the application of state and federal securities laws and other laws and regulations to digital assets is unclear in certain
respects, and it is possible that regulators in the United States or foreign countries may interpret or apply existing laws and regulations
in a manner that adversely affects the price of bitcoin. The U.S. federal government, states, regulatory agencies, and foreign countries
may also enact new laws and regulations, or pursue regulatory, legislative, enforcement or judicial actions, that could materially impact
the price of bitcoin or the ability of individuals or institutions such as us to own or transfer bitcoin. For examples, see “—Bitcoin and other digital assets are novel assets, and are subject to significant legal, commercial, regulatory and technical uncertainty”
above.

If bitcoin or XRP is determined to constitute a security
for purposes of the federal securities laws, the additional regulatory restrictions imposed by such a determination could adversely affect
the market price of bitcoin and in turn adversely affect the market price of our common stock. See “—Regulatory change reclassifying bitcoin as a security could lead to our classification as an “investment company” under the Investment Company Act of 1940, as amended, or the 1940 Act, and could adversely affect the market price of bitcoin and the market price of our common stock”
above. Moreover, the risks of us engaging in a bitcoin treasury strategy have created, and could continue to create, complications due
to the lack of experience that third parties have with companies engaging in such a strategy, such as increased costs of director and
officer liability insurance or the potential inability to obtain such coverage on acceptable terms in the future.

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Our intended bitcoin holdings may be less liquid than our existing cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents.

Historically, the bitcoin and XRP markets have been
characterized by significant volatility in price, limited liquidity and trading volumes compared to sovereign currencies markets, relative
anonymity, a developing regulatory landscape, potential susceptibility to market