Company: GAME
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023589
Chunk: 283

Company: GameSquare Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 4
Chunk 283
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 of these actions could have a material adverse effect on our results of operations
and financial condition. Moreover, we can make no assurance that we would successfully be able to take the necessary steps to avoid being
deemed to be an investment company in accordance with the safe harbor. If we were unsuccessful, and if Ethereum and/or indirect ownership
interests in ETH funds which hold Ethereum is determined to constitute a security for purposes of the federal securities laws, then 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 Ethereum 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
Ethereum 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, 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 Ethereum. 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 Ethereum or the ability of individuals or institutions such as us to own
or transfer Ethereum.

Changes
in the accounting treatment of cryptocurrency holdings could have significant accounting impacts, including increasing the volatility
of our results. 

In
December 2023, the FASB issued ASU 2023-08, which upon our adoption will require us to measure in-scope cryptocurrency assets at fair
value in our statement of financial position, and to recognize gains and losses from changes in the fair value of our cryptocurrency
in net income each reporting period. ASU 2023-08 will also require us to provide certain interim and annual disclosures with respect
to our cryptocurrency holdings. The standard is effective for our interim and annual periods beginning January 1, 2025, with a cumulative-effect
adjustment to the opening balance of retained earnings as of the beginning of the annual reporting period in which we adopt the guidance.
We adopted ASU 2023-08 for the fiscal year beginning January 1, 2025 and the adoption did not have any impact to our consolidated financial
statements as we did not have any cryptocurrency holdings at adoption. Due