Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 42

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 42
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 are able to prevent our and our customers’ bitcoin from
being considered the property of a Bitcoin Service Provider’s bankruptcy estate as part of an insolvency proceeding, it is possible
that we or our customers would still be delayed or may otherwise experience difficulty in accessing bitcoin held by the affected Bitcoin
Service Provider during the pendency of the insolvency proceedings.

Any such outcome could have a material adverse effect
on our financial condition and the market price of our stock. In addition, even if our Bitcoin Service Providers themselves do not become
insolvent, a series of insolvencies of high-profile custodians such as occurred in 2022 could result in customers finding our services
more risky and less attractive as compared to other types of rewards cards, and any failure to increase our customer base, discontinuation
or reduction in use of our platform and products by existing customers as a result could adversely impact our business, operating results,
and financial condition.

27

The theft, loss, or destruction of private keys required to access
any Bitcoin may be irreversible. If we or our Bitcoin Service Providers are unable to access private keys for the Bitcoin wallets holding
our or our customers’ Bitcoin, or if we or our Bitcoin Service Providers experience a hack or other data loss relating to their
ability to access any Bitcoin, it could cause regulatory scrutiny, reputational harm, and other losses.

Bitcoin is generally controllable only by the possessor
of the unique private key relating to the digital wallet in which the Bitcoin is held. While blockchain protocols typically require public
addresses to be published when used in a transaction, private keys must be safeguarded and kept private in order to prevent a third party
from accessing the Bitcoin held in such a wallet. To the extent that any of the private keys relating to wallets containing Bitcoin held
for the benefit of us or our customers is lost, destroyed, or otherwise compromised or unavailable, and no backup of the private key is
accessible, we or the Bitcoin Service Providers will be unable to access the Bitcoin assets held in the related wallet. Further, we cannot
provide assurance that the private keys to Bitcoin wallets held by us directly or by our service providers will not be hacked or compromised.
Bitcoin assets and blockchain technologies have been, and may in the future be, subject to security breaches, hacking, or other malicious
activities. Any loss of private keys relating to, or hack or other compromise of, digital wallets used to store our customers’ Bitcoin
could adversely affect our customers’ ability to access or sell their