Company: FLDDW
Filing Date: 2025-04-11
Form Type: 424B3
Source: 0001213900-25-031004
Chunk: 235

Company: Fold Holdings, Inc.
Filing Date: 2025-04-11
Form: 424B3
Chunk 235
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als can be made either to an external bitcoin wallet or to a user’s bitcoin wallet
at the qualified custodians used by Fold.

The Company accrues both Revenue Rewards and Marketing
Rewards, (collectively, the “Rewards”) within ‘Customer rewards liability’ in our accompanying balance sheets at
the time the Reward is earned, with the corresponding impact on our statements of operations dependent on the type of Reward. Revenue
Rewards are recorded as a reduction in the transaction price of the related revenue earned - see Revenue recognition below. Marketing
Rewards are recorded as a marketing expense within operating expenses. The liability is initially recorded at the fair value of the bitcoin
earned upon the action by the user and subsequently marked to fair value until redeemed or reversed, with gains and losses on this liability
recorded within ‘Gain (loss) on customer rewards liability’ in our accompanying statements of operations. The liability is derecognized
when the Reward is redeemed by the user and delivered to the user’s bitcoin wallet.

Per the terms and conditions of the Fold Rewards
Program, Rewards are subject to adjustment for chargebacks, returns, refunds, or other circumstances. In addition, Rewards are subject
to expiry if users fail to maintain an active account for more than twelve consecutive months. The Company estimates the amount of Rewards
that will expire based on historical data, current user trends, and other factors and records those estimated amounts in the period those
Rewards were earned. These accruals are accounted for as an adjustment to the transaction price of the original revenue transaction if
the expiration relates to Revenue Rewards, or as contra-expense within marketing expense if the expiration relates to Marketing Rewards.

<div align='center'>F-12

Fold, Inc.

Notes to Financial Statements</div>

Derivatives

As our customer rewards liability results in an
obligation to deliver a fixed amount of digital assets in the future, the Company has determined that it meets the definition of a derivative
and marks it to fair value each period as discussed above. The Company has not designated this derivative instrument as a hedging instrument.
As of December 31, 2024 and 2023, the notional amount of the customer rewards liability outstanding was 92 and 126 bitcoin, respectively,
and the derivative instrument was valued at $8.6 million and $5.3 million, respectively, within ‘Customer rewards liability’ on our accompanying
balance sheets. For the years ended December 31, 2024 and 202