Company: IPST
Filing Date: 2025-08-26
Form Type: S-1
Source: 0001213900-25-080839
Chunk: 80

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-26
Form: S-1
Chunk 80
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 if financial institutions were to deny or limit banking services to businesses that hold $IP tokens, provide $IP tokens -relatedservices or accept $IP tokens as payment, which could also decrease the price of $IP tokens. A number of companies and individuals or businesses associated with digital assets may have had, and may continue to have, their existing banking services discontinued with financial institutions. Although U.S. banking regulators have recently rescinded prior guidance that emphasized the risks associated with digital asset businesses, it is possible that some banking institutions may remain unwilling to provide services to companies in the digital asset space. Loss of access to fiat rails (after failures of crypto friendly banks or policy shifts) may delay settlements, tax payments, or vendor obligations, impairing liquidity. The liquidity of $IP tokens may also be impacted to the extent that changes in applicable laws and regulatory requirements negatively impact the ability of exchanges and trading venues to provide services for $IP tokens and other digital assets. Our shift towards an $IP-focused strategy requires substantial changes in our day-to-day operations and exposes us to significant operational risks. We may choose to operate our own validator services or we may seek to “delegate” our $IP to third party validation service providers. If we choose to use a third -partyvalidation service, we would have to share our staking rewards with that third -partyvalidator, but that third -partyvalidator may have more sophisticated technology which would enable those rewards to be greater. In either case, staking increases the risk of loss of $IP, including through slashing penalties and through increasing vulnerabilities to hacking in the staking smart contracts. Validators also need to maintain uptime in order to maximize their rewards. In addition, the $IP ecosystem may rapidly evolve, with frequent upgrades and protocol changes that may require significant adjustments to our operational setup. The upgrades and protocol changes may require that we incur unanticipated costs and it could cause temporary service disruptions. Technical failures or operational errors could impact our ability to obtain $IP rewards or gas fees, which could result in our failure to meet our financial projections. Staked $IP is also subject to lock -upperiods during which it cannot be withdrawn or sold. This lack of liquidity could limit our ability to respond to market changes or our financial needs. We may seek to mitigate this risk through so -called“liquid staking” arrangements, where we deposit $IP into a smart contract and receive in exchange a “liquid staking token” which would allow us to withdraw our $IP and associated rewards. The smart contract would then automatically