Company: PFSA
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112723
Chunk: 89

Company: Profusa, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 1
Chunk 89
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 in our reported
earnings, amplified by our asset concentration in bitcoin, and decrease the carrying value of our digital assets, which in turn could
have a material adverse effect on the market price of our common stock. Conversely, any sale of bitcoins at prices above our carrying
value for such assets creates a gain for financial reporting purposes even if we would otherwise incur an economic or tax loss with respect
to such transaction, which also may result in significant volatility in our reported earnings.

Because we intend to purchase additional bitcoin in future periods
and increase our overall holdings of bitcoin, we expect that the proportion of our total assets that will be represented by our bitcoin
holdings will increase in the future. As a result, and in particular with respect to the quarterly periods and full fiscal year with respect
to which ASU 2023-08 will apply, and for all future periods, volatility in our earnings may be significantly more than what we experienced
in prior periods. As of the date of this filing, the Company has purchased $2.0 million of Bitcoin as part of the Company’s ongoing
treasury strategy, representing 16.51 Bitcoins.

Due to the currently unregulated nature and lack of transparency
surrounding the operations of many bitcoin trading venues, bitcoin trading venues may experience greater fraud, security failures or regulatory
or operational problems than trading venues for more established asset classes, which may result in a loss of confidence in bitcoin trading
venues and adversely affect the value of our bitcoin.

Bitcoin trading venues are relatively new and, in many cases, currently
unregulated. Even if regulated, such venues may not be complying with such regulations. Furthermore, there are many bitcoin trading venues
that do not provide the public with significant information regarding their ownership structure, management teams, corporate practices
and regulatory compliance. As a result, the marketplace may lose confidence in bitcoin trading venues, including prominent exchanges that
handle a significant volume of bitcoin trading and/or are subject to regulatory oversight, in the event one or more bitcoin trading venues
cease or pause for a prolonged period the trading of bitcoin or other digital assets, or experience fraud, significant volumes of withdrawal,
security failures or operational problems.

54

In 2019 there were reports claiming that 80-95% of bitcoin trading
volume on trading venues was false or non-economic in nature, with specific focus on currently unregulated exchanges located outside of
the United States. The SEC also alleged as part of its June 2023 complaint that Binance Holdings Ltd.