Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 59

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 59
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 into receivership following a
cease-and desist order issued by Nevada’s Department of Business and Industry, and the filing and subsequent settlement of a civil
fraud lawsuit by the New York Attorney General against Genesis Global Capital, its parent company Digital Currency Group, Inc., and former
partner Gemini Trust Company, have highlighted the counterparty risks applicable to owning and transacting in digital assets.

Although these bankruptcies, closures, liquidations
and other events have not resulted in any loss or misappropriation of our Bitcoin, nor have such events adversely impacted our access
to our Bitcoin, they created significant volatility in the markets for cryptocurrency generally and for Bitcoin particularly. Additional
bankruptcies, closures, liquidations, regulatory enforcement actions or other events involving participants in the digital assets industry
in the future could result in market prices being subject to erratic and abrupt market movement, which could harm our business. Further,
because there is no centralized authority which determines the price of Bitcoin, pricing often differs between exchanges. When some exchanges
are viewed as higher risk, that price differential can widen as traders attempt to exploit these differences. Volatility in the price
of Bitcoin, as well as the lack of a standard price, could lead consumers to see Bitcoin as an unsafe asset, which would result in losses
of customers and resulting harm to our business. In addition, if we were to attempt to monetize the Bitcoin we hold on our balance sheet,
such price volatility could lead to trading losses, impacting our financial position.

For example, based on aggregate US exchange markets
data collected by CoinMarketCap, on December 18, 2023, the price of Bitcoin at 10:00 P.M. UTC was $42,623.54. On December 18, 2024, the
price of Bitcoin at 10:00 P.M. UTC was $100,041.54. Between those dates, Bitcoin experienced significant volatility. For example, on August
1, 2024, the price of Bitcoin was $65,353.50, and on August 5, 2024 the price of Bitcoin was $53,991.35. On August 24, 2024, the price
of Bitcoin had risen again to $64,176.37. In 2022, price swings were even more drastic, with prices as high as $47,459 at the end of March
2022 and as low as $16,530 at the end of the year. Such volatility will impact the overall