Company: FLDDW
Filing Date: 2025-01-22
Form Type: S-4/A
Source: 0001213900-25-005202
Chunk: 451

Company: Fold Holdings, Inc.
Filing Date: 2025-01-22
Form: S-4/A
Chunk 451
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 selling prices in the ordinary course of business. Control of the Company’s inventory is generally transferred to customers within a short period of time from purchase, and therefore the Company has not recognized inventory obsolescence expense during the years ended December 31, 2023 or 2022. Digital assets The Company holds digital assets, comprised solely of bitcoin, for two purposes: (1)to fulfill rewards to customers in accordance with the terms and conditions of Fold’s user agreements; and (2)as a treasury asset with the intention to hold as a long -terminvestment. The Company accounts for digital assets as indefinite -livedintangible assets in accordance with ASC 350 -60, Intangibles — Goodwill and Other — Crypto Assets. Under this guidance, digital assets are initially measured at cost and subsequently remeasured at fair value, with gains or losses on remeasurement included in gain (loss) within the accompanying statements of operations. Fair value is measured using the quoted price of bitcoin per the principal market for the related digital assets at the time fair value is being measured. F-9

Fold, Inc.
Notes to Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.) The Company has determined that the gains or losses on digital assets held for the purposes of satisfying its customer rewards are related to its core operations, and therefore classifies gains and losses on the remeasurement of bitcoin held for that purpose as operating income or expense in its statements of operations. The Company assigns costs to digital assets on a first -in, first -outbasis. Digital assets are classified as current in the Company’s accompanying balance sheets to the extent they are being held to fulfill customer reward redemptions as that is the amount that we reasonably expect to liquidate within a one -yearperiod. The excess of our digital assets held over the customer reward liability is classified as a long -termasset held for investment. Safeguarding customer digital assets and liabilities On March 31, 2022, the Securities and Exchange Commission issued Staff Accounting Bulletin Number 121 (“SAB 121”), which provides the SEC staff’s view that it would be appropriate for an entity that has an obligation to safeguard digital assets (such as bitcoin) held for platform users to record a liability and corresponding asset on its balance sheet at the fair value of the digital assets. We adopted the guidance in SAB 121 for the period beginning January 1, 2022, which was the first period where this guidance was applicable to our