# EDGAR Filing Document

**Accession Number:** 0001821866
**File Stem:** 0001062993-26-001710
**Filing Date:** 2026-3
**Character Count:** 367480
**Document Hash:** 4433a16c06e8d43ee9a74248c1bc6a1e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001062993-26-001710.hdr.sgml**: 20260331

**ACCESSION NUMBER**: 0001062993-26-001710

**CONFORMED SUBMISSION TYPE**: 40-F

**PUBLIC DOCUMENT COUNT**: 18

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260331

**DATE AS OF CHANGE**: 20260330

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** BTQ Technologies Corp.
- **CENTRAL INDEX KEY:** 0001821866
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370]
- **ORGANIZATION NAME:** 06 Technology
- **EIN:** 000000000
- **STATE OF INCORPORATION:** A1
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 40-F
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-42794
- **FILM NUMBER:** 26816586

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 700 WEST GEORGIA STREET, SUITE 2500
- **CITY:** VANCOUVER
- **PROVINCE COUNTRY:** A1
- **ZIP:** V7Y 1B3
- **BUSINESS PHONE:** (416) 479 9547

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 700 WEST GEORGIA STREET, SUITE 2500
- **CITY:** VANCOUVER
- **PROVINCE COUNTRY:** A1
- **ZIP:** V7Y 1B3

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Sonora Gold & Silver Corp.
- **DATE OF NAME CHANGE:** 20200820

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**UNITED STATES**<br>**SECURITIES AND EXCHANGE COMMISSION**<br>**Washington, D.C. 20549**

**____________________**

**FORM 40-F**

[ ] Registration statement pursuant to Section 12 of the Securities Exchange Act of 1934 <br> or <br> [X] Annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934

**For the fiscal year ended December 31, 2025**

**Commission File Number 001-42794<br>**

<br> <u>**BTQ Technologies Corp.**</u><br>(Exact name of Registrant as specified in its charter)

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| | | |
|:---|:---|:---|
| <u>**British Columbia**</u> | <u>**7370**</u> | <u>**Not applicable**</u> |
| (Province or other jurisdiction of incorporation or organization) | (Primary Standard Industrial<br>Classification<br>Code Number) | (I.R.S. Employer<br> Identification Number) |

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**2500 - 700 West Georgia Street**

**Vancouver, British Columbia V7Y 1B3**<br><u>(**807) 790-9591**</u><br>(Address and telephone number of Registrant's principal executive offices)

**____________________**

**C T Corporation System**

**1015 15th Street N.W., Suite 1000**

**Washington, DC 20005**

<u>**(202) 572-3133**</u> <br>(Name, address (including zip code) and telephone number (including<br>area code) of agent for service in the United States)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| <u>Title of each class</u> | <u>Trading Symbol(s)</u> | <u>Name of each exchange on which registered</u> |
| **Common Shares, no par value** | **BTQ** | **Nasdaq Global Market** |

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Securities registered pursuant to Section 12(g) of the Act: None.

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Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

For annual reports, indicate by check mark the information filed with this Form:

[X] Annual information form [X] Audited annual financial statements

Number of outstanding shares of each of the issuer's classes of capital or common stock as of December 31, 2025: 140,400,930 Common Shares, no par value.

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X] Yes [ ] No

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 12b-2 of the Exchange Act.

Emerging growth company [X]

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. [ ]

The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. [ ]

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. [ ]

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). [ ]

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**EXPLANATORY NOTE**

BTQ Technologies Corp. (the "Company" or the "Registrant") is a Canadian public company whose common shares are listed on the Nasdaq Global Market (the "Nasdaq") under the symbol "BTQ." The Company is eligible to file its annual report pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), on Form 40-F pursuant to the multijurisdictional disclosure system of the Exchange Act ("MJDS"). The Company is a "foreign private issuer" as defined in Rule 3b- 4 under the Exchange Act. Equity securities of the Company are accordingly exempt from Sections 14(a), 14(b), 14(c), 14(f) and 16 of the Exchange Act pursuant to Rule 3a12-3.

**FORWARD-LOOKING INFORMATION**

This annual report on Form 40-F (the "Annual Report") contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities legislation (collectively, "forward-looking information") with respect to the Company and its subsidiaries. Forward-looking information may include, but is not limited to: information with respect to amounts and use of available funds; anticipated developments in operations in future periods; planned asset acquisitions; future business operations; the adequacy of financial resources; the costs and timing of development of the Company's business; the costs, timing and receipt of approvals, consents and permits under applicable legislation; executive compensation approaches and practices; the growth of the quantum technology and security market; the future applications of Company products; the timeline for a quantum computer hitting the market; the use of Company office space; anticipated revenue from Company's products and business; the development of and applicability of quantum technologies; the commercialization of the Company's intellectual property; the general adoption of quantum technologies; adoption of post-quantum cryptographic technologies; the future size of the global post-quantum cryptography market; results and timing of acquisitions and partnerships; the Company's research and development plan; the results from Company research and development; future intellectual property registrations of the Company; the future availability of Company products; and the composition of directors and committees.

Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words and phrases such as "will", "may", "is expected to", "anticipates", "estimates", "intends", "plans", "projection", "could", "vision", goals", "objective" and "outlook") are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. In making these forward-looking statements, the Company has made certain assumptions, as contemplated below.

Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual events or results to differ from those expressed or implied by the forward-looking information, including, without limitation: limited operating history; negative operating cash flow; compliance and risk management programs; unexpected market disruptions; dependence on key personnel; market risk for the Company's securities; foreign exchange risk; taxation, litigation, and investment risks; the Company's ability to manage its growth; incorrect estimates of market opportunities; regulatory risks; the Company's reliance on internally and externally built software, data and intellectual property; the Company's ability to find banks and insurance companies willing to provide services; cybersecurity risks; stock exchange listing compliance risk; acquisition integration risk; export controls and national security risks; digital asset and cryptocurrency regulatory risk; the early stage of quantum computing industry; key partnership concentration risk; pre-revenue commercialization risk; and risks associated with the enforcement of judgements against foreign persons.

The above list is not exhaustive of factors that may affect any of the forward-looking information contained in this Annual Report. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Forward-looking information involves statements about the future and is inherently uncertain, and the actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company's Annual Information Form for the year ended December 31, 2025 (the "AIF") as filed as Exhibit 99.1 under the heading "Risk Factors" and elsewhere in this Annual Report. Forward-looking information contained in this Annual Report is based on the beliefs, expectations and opinions of management of the Company on the date the statements are made, and the Company does not assume any obligation to update forward-looking information, whether as a result of new information, future events or otherwise, other than as required by applicable law. In making the forward-looking statements in this Annual Report, the Company has applied several material assumptions which may prove to be inaccurate, including, but not limited to, the assumptions that any financing needed to fund the operations of the Company will be available on reasonable terms. Other assumptions are discussed throughout this Annual Report and, in particular in the "Risk Factors" section of the AIF as filed as Exhibit 99.1. For the reasons set forth above, prospective investors should not place undue reliance on forward-looking information

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**DIFFERENCES IN UNITED STATES AND CANADIAN REPORTING PRACTICES**

The Registrant is permitted, under MJDS adopted by the United States Securities and Exchange Commission (the "SEC"), to prepare this report in accordance with Canadian disclosure requirements, which are different from those of the United States. The Registrant prepares its consolidated financial statements, which are filed with this report on Form 40-F, in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board, and the audit is subject to Canadian auditing and auditor independence standards. MNP LLP is independent with respect to the Company in accordance with the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) and the SEC.

**CURRENCY**

Unless otherwise indicated, all dollar amounts in this Annual Report are in Canadian dollars. The exchange rate of Canadian dollars into United States dollars, based upon the daily exchange rate as quoted by the Bank of Canada, was US$1.00 = CDN$1.3706 on December 31, 2025.

**ANNUAL INFORMATION FORM**

The AIF is filed as Exhibit 99.1 to this Annual Report and is incorporated by reference herein.

**AUDITED FINANCIAL STATEMENTS**

The audited consolidated financial statements of the Company for the years ended December 31, 2025 and 2024, including the report of the independent auditor (PCAOB ID#1930) thereon (the "Financial Statements"), are filed as Exhibit 99.2 to this Annual Report and are incorporated by reference herein.

**MANAGEMENT'S DISCUSSION AND ANALYSIS**

The Company's Management's Discussion and Analysis for the year ended December 31, 2025 (the "MD&A"), is filed as Exhibit 99.3 to this Annual Report and is incorporated by reference herein.

**CERTIFICATIONS AND DISCLOSURE REGARDING CONTROLS AND PROCEDURES**

*Disclosure Controls and Procedures*

As of the end of the period covered by this Annual Report, the Company's Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") have designed, or caused to be designed under their supervision, the Company's disclosure controls and procedures ("DCP") (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) to provide reasonable assurance that material information relating to the Company and its consolidated subsidiaries has been recorded, processed, summarized and disclosed in a timely manner in accordance with regulatory requirements and good business practices and that the Company's DCP will enable the Company to meet its ongoing disclosure requirements under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) accumulated and communicated to the Company's management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

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While the Company's principal executive officer and principal financial officer believe that the Company's disclosure controls and procedures provide a reasonable level of assurance that they are effective, they do not expect that the Company's disclosure controls and procedures or internal control over financial reporting will prevent all errors or fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

*Management's Internal Control Over Financial Reporting*

This Annual Report does not include a report of management's assessment regarding internal control over financial reporting due to a transition period established by rules of the SEC for newly public companies.

*Changes In Internal Control Over Financial Reporting*

There have been no changes to our internal control over financial reporting for the fiscal year ended December 31, 2025, that could have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

*Attestation Report of the Registered Public Accounting Firm*

This Annual Report does not include an attestation report of the Company's registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

**TAX MATTERS**

Purchasing, holding, or disposing of securities of the Registrant may have tax consequences under the laws of the United States and Canada that are not described in this Annual Report.

**OFF-BALANCE SHEET ARRANGEMENTS**

The Registrant has no off-balance sheet arrangements. (as that term is defined in paragraph 11(ii) of General Instruction B to Form 40-F) that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

**CONTRACTUAL OBLIGATIONS**

In accordance with General Instruction B.(12) of Form 40-F, the required disclosure is included under the heading "Liquidity Risk" in MD&A filed as Exhibit 99.3 to this Annual Report and incorporated by reference herein.

**CORPORATE GOVERNANCE**

The objectives of the Compensation Committee are to: (a) assist the Company's board of directors (the "Board") in reviewing Board compensation; (b) assist the Board in fulfilling its oversight responsibilities (especially for accountability) in respect of the Company's compensation programs, including, executive compensation, and related matters, including assisting the Board to identify, assess and manage the implications of the risks associated with the Company's compensation policies and practices; (c) identify and discuss with the Board succession and resource planning risks facing the Company and to identify ways in which any such risks may be mitigated, including ensuring that executive compensation is adequate to attract, motivate and retain competent executive personnel; and (d) ensure that executive compensation is directly and materially related to operating performance and aligned with the short-term and long-term objectives of the Company and its shareholders.

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The responsibilities of the Compensation Committee include: (a) making recommendations to the Board regarding all aspects of executive officer and director compensation and the Company's general compensation philosophy; (b) make recommendations regarding, and oversee the development and administration of, the Company's long term compensation plan; (c) overseeing the Board's evaluation of management

The Company's Compensation Committee charter is available on the Company's website at the following address: <u>https://btq.com</u>.

The objectives of the Nomination and Governance Committee are (a) to assist the Board in fulfilling its oversight responsibilities in respect of the development, implementation and monitoring of the Company's corporate governance practices, (b) to assist the Board in reviewing and assessing the size and composition of the Board and Board committees and the selection of Board committee chairs; (c) planning for the Board's succession, director education and evaluation, (d) to assist the Board in establishing appropriate risk oversight functions at the Board and Board committee levels; (e) to identify individuals qualified to become Board members; and (f) to facilitate and oversee the periodic performance assessment process for the Board, the other Board committees and management.

The Nomination and Governance Committees duties and responsibilities include: (a) monitoring corporate governance issues, principles and guidelines and developing and recommending corporate governance guidelines; (b) review the composition of the Board, including its individual members, and recommend any necessary changes; (c) recommend director nominees for each annual general meeting of shareholders and, as required, to fill any vacancies in the Board or committees of the Board; (d) identifying candidates to act as directors of the Company; (e) approving director orientation processes and ongoing development and education of existing directors; establish and foster a healthy governance culture within the Company.

The Company's Nomination and Governance Committee charter is available on the Company's website at the following address: <u>https://btq.com</u>.

**AUDIT COMMITTEE** 

The Board of Directors has a separately designated standing Audit Committee established for the purpose of overseeing the accounting and financial reporting processes of the Company and audits of the financial statements of the Company in accordance with Section 3(a)(58)(A) of the Exchange Act. As of the date of this Annual Report, the Company's Audit Committee is comprised of Lionel de St-Exupéry (chair), Mansour Al Suwaidi, and Philippe Lucet, all of whom are independent based on the criteria for independence prescribed by Rule 10A-3 of the Exchange Act and Nasdaq Listing Rule 5605(a)(2). The Company is relying on the phase-in provisions of Nasdaq Listing Rule 5615(b) for the audit committee composition requirements set forth in Nasdaq Listing Rule 5605(c)(2).

The Board has also determined that each member of the Audit Committee is financially literate, meaning each such member has the ability to read and understand a set of financial statements that present a breadth and level of complexity of the issues that can reasonably be expected to be raised by the Company's financial statements.

The full text of the Audit Committee Charter is included in the Company's AIF, which is filed as Exhibit 99.1 to this Annual Report and incorporated by reference herein.

*Audit Committee Financial Expert*

The Board of Directors has determined Lionel de St-Exupéry qualifies as a financial expert (as defined in Item 407(d)(5)(ii) of Regulation S-K under the Exchange Act), has financial management expertise (pursuant to Rule 5605(c)(2)(A) of the listing rules of the Nasdaq (the "Nasdaq Stock Market Rules")) and is independent (as determined under Exchange Act Rule 10A-3 and Rule 5605(a)(2) of the Nasdaq Stock Market Rules).

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**PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES PROVIDED BY INDEPENDENT AUDITOR**

The Audit Committee Charter sets out that the Audit Committee is responsible for the pre-approval of all audit services and legally permissible non-audit services to be provided by the external auditors considering the potential impact of such services on the independence of external auditors and, subject to any *de minimis* exemption available under applicable laws. Such approval of non-audit services can be given either specifically or pursuant to pre-approval policies and procedures adopted by the committee including the delegation of this ability to one or more members of the Audit Committee to the extent permitted by applicable law, provided that any pre-approvals granted pursuant to any such delegation may not delegate Audit Committee responsibilities to management of the Corporation, and must be reported to the full Audit Committee at the first scheduled meeting of the Audit Committee following such pre-approval.

There were no non-audit services performed by the Company's auditor for the fiscal year ended December 31, 2025. Accordingly, no non-audit services were approved pursuant to the de minimis exemption to the pre-approval requirement set forth in Rule 2-01(c)(7)(i)(C) of Regulation S-X.

**PRINCIPAL ACCOUNTANT FEES AND SERVICES**

The information provided under the headings "*Audit Committee Disclosure- Pre-Approval Policies and Procedures"* contained in the AIF, filed as Exhibit 99.1 hereto, is incorporated by reference herein.

The Company's Independent Registered Public Accounting Firm is MNP LLP, Chartered Professional Accountants, located in Toronto, Ontario.

**NASDAQ CORPORATE GOVERNANCE**

The Company is a "foreign private issuer" as defined in Rule 3b-4 under Exchange Act and the Company's common shares are listed on the Cboe Canada ("Cboe") and on the Nasdaq. Rule 5615(a)(3) of the Nasdaq Stock Market Rules permits foreign private issuers to follow home country practices in lieu of certain provisions of Nasdaq Stock Market Rules. A foreign private issuer that follows home country practices in lieu of certain provisions of Nasdaq Stock Market Rules must disclose ways in which its corporate governance practices differ from those followed by domestic companies either on its website or in the annual report that it distributes to shareholders in the United States.

A description of the ways in which the Company's governance practices differ from those followed by domestic companies pursuant to Nasdaq standards are as follows:

***Executive Sessions***: The Registrant does not follow Nasdaq Stock Market Rule 5605(b)(2), which requires companies to have their Independent Directors regularly schedule meetings at which only Independent Directors are present ("executive meetings"). In lieu of following Nasdaq Stock Market Rule 5605(b)(2), the Registrant follows the rules of Cboe, the *Business Corporations Act* (British Columbia) and Canadian securities laws.

***Shareholder Meeting Quorum Requirements***: The Registrant does not follow Nasdaq Stock Market Rule 5620(c) which requires that the minimum quorum requirement for a meeting of shareholders be 33 1/3 % of the outstanding common shares. In addition, Nasdaq Stock Market Rule 5620(c) requires that an issuer listed on Nasdaq state its quorum requirement in its by-laws. In lieu of following Nasdaq Stock Market Rule 5620(c), the Registrant follows the rules of Cboe, the *Business Corporations Act* (British Columbia) and Canadian securities laws.

***Shareholder Approval Requirement***: The Registrant does not follow Nasdaq Listing Rule 5635(d), which requires shareholder approval prior to a transaction involving the sale or issuance of common shares (or securities convertible into or exercisable for its common shares): (i) at a price below the greater of book value or market value; and (ii) which together with sales by officers, directors, or substantial shareholders, is equal to 20% or more of the company's outstanding common shares or 20% or more of the voting power prior to issuance. In lieu of following Nasdaq Listing Rule 5635(d), the Registrant follows the rules of Cboe, the *Business Corporations Act* (British Columbia) and Canadian securities laws.

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The foregoing is consistent with applicable laws, customs and practices in Canada.

**CODE OF ETHICS**

The Company's Code of Conduct (the "Code") applies to all directors, officers, employees, consultants, contractors, and agents of the Company, including the CEO and CFO. Since the adoption of the Code, there have not been any waivers, including implied waivers, from any provision of the Code. A copy of the Code can be found on the Company's internet website at the following address: <u>https://btq.com</u>.

**NOTICES PURSUANT TO REGULATION BTR**

There were no notices required by Rule 104 of Regulation BTR that the Company sent during the year ended December 31, 2025 concerning any equity security subject to a blackout period under Rule 101 of Regulation BTR.

**MINE SAFETY DISCLOSURE**

Not applicable.

**DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS**

Not applicable.

**RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION**

Not applicable.

**UNDERTAKING**

The Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the SEC staff, and to furnish promptly, when requested to do so by the SEC staff, information relating to the securities in relation to which the obligation to file an annual report on Form 40-F arises or transactions in said securities.

**CONSENT TO SERVICE OF PROCESS**

The Registrant has previously filed a Form F-X in connection with the class of securities in relation to which the obligation to file this report arises.

Any change to the name or address of the agent for service of the Registrant shall be communicated promptly to the SEC by amendment to Form F-X referencing the file number of the Registrant.

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**SIGNATURES**

Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this Annual Report to be signed on its behalf by the undersigned, thereto duly authorized.

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| | | |
|:---|:---|:---|
|  |  | **BTQ TECHNOLOGIES CORP.** |
|  | By: | */s/ Olivier Roussy Newton* |
|  |  | Name: Olivier Roussy Newton |
| Date: March 30, 2026 |  | Title: Chief Executive Officer & Director |

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**EXHIBIT INDEX** 

The following documents are being filed with the SEC as Exhibits to this Form 40-F:

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| | |
|:---|:---|
| <u>**Exhibit Number**</u> | <u>**Description**</u> |
| [99.1](exhibit99-1.htm) | [Annual Information Form of BTQ Technologies Corp. for the year ended December 31, 2025](exhibit99-1.htm) |
| [99.2](exhibit99-2.htm) | [Audited Consolidated Financial Statements of BTQ Technologies Corp. for the years ended December 31, 2025 and 2024](exhibit99-2.htm) |
| [99.3](exhibit99-3.htm) | [Management's Discussion and Analysis of BTQ Technologies Corp. for the year ended December 31, 2025](exhibit99-3.htm) |
| [99.4](exhibit99-4.htm) | [Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange Act of 1934, as amended](exhibit99-4.htm) |
| [99.5](exhibit99-5.htm) | [Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange Act of 1934, as amended](exhibit99-5.htm) |
| [99.6](exhibit99-6.htm) | [Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](exhibit99-6.htm) |
| [99.7](exhibit99-7.htm) | [Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](exhibit99-7.htm) |
| [99.8](exhibit99-8.htm) | [<u>Consent of</u> <u>MNP LLP</u>](exhibit99-8.htm) |

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## Exhibit 99.1

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![](exhibit99-1x001.jpg)

**BTQ TECHNOLOGIES CORP.**

**ANNUAL INFORMATION FORM** 

**FOR THE YEAR ENDED DECEMBER 31, 2025**

**March 30, 2026**

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**TABLE OF CONTENTS**

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| | |
|:---|:---|
| [**GLOSSARY OF DEFINED TERM** **S**](#page_3) | [**3**](#page_3) |
| [**GENERAL**](#page_3) | [**3**](#page_3) |
| [**CURRENCY AND EXCHANGE RATE INFORMATION**](#page_3) | [**3**](#page_3) |
| [**STATEMENT REGARDING FORWARD LOOKING INFORMATION**](#page_3) | [**3**](#page_3) |
| [**CORPORATE STRUCTURE**](#page_4) | [**4**](#page_4) |
| [**GENERAL DEVELOPMENT OF THE BUSINESS**](#page_5) | [**5**](#page_5) |
| [**DESCRIPTION OF BUSINESS**](#page_7) | [**7**](#page_7) |
| [**RISK FACTORS**](#page_20) | [**20**](#page_20) |
| [**DIVIDENDS**](#page_32) | [**32**](#page_32) |
| [**DESCRIPTION OF CAPITAL STRUCTURE**](#page_33) | [**33**](#page_33) |
| [**MARKET FOR SECURITIES**](#page_34) | [**34**](#page_34) |
| [**DIRECTORS AND OFFICERS**](#page_35) | [**35**](#page_35) |
| [**AUDIT COMMITTEE DISCLOSURE**](#page_39) | [**39**](#page_39) |
| [**PROMOTERS**](#page_40) | [**40**](#page_40) |
| [**LEGAL PROCEEDINGS AND REGULATORY ACTIONS**](#page_40) | [**40**](#page_40) |
| [**INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS**](#page_40) | [**40**](#page_40) |
| [**TRANSFER AGENTS AND REGISTRARS**](#page_40) | [**40**](#page_40) |
| [**MATERIAL CONTRACTS**](#page_41) | [**41**](#page_41) |
| [**INTEREST OF** **EXPERTS**](#page_41) | [**41**](#page_41) |
| [**ADDITIONAL INFORMATION**](#page_41) | [**41**](#page_41) |
| [**APPENDIX "A"**](#page_42) | [**42**](#page_42) |

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**GENERAL**

Unless otherwise noted herein, information in this AIF is presented as at December 31, 2025.

In this annual information form, a reference to the "Company", "BTQ", "we", "us", "our" and similar words refer to BTQ Technologies Corp., its subsidiaries and affiliates, or any one of them, as the context requires.

**CURRENCY AND EXCHANGE RATE INFORMATION** 

In this AIF, otherwise specified or the context otherwise requires, all dollar amounts are expressed in Canadian dollars. All references to "dollars", "$" or "C$" are to Canadian dollars, all references to "US$" are to United States dollars.

On December 31, 2025, the daily exchange rate as quoted by the Bank of Canada was US$1.00 = C$1.3706

**STATEMENT REGARDING FORWARD LOOKING INFORMATION** 

This AIF contains forward-looking information within the meaning of applicable Canadian securities legislation with respect to the Company and its subsidiaries. Forward looking information may include, but is not limited to: information with respect to amounts and use of available funds; anticipated developments in operations in future periods; future business operations; the adequacy of financial resources; the costs and timing of development of the Company's business; the costs, timing and receipt of approvals, consents and permits under applicable legislation; the growth of the quantum technology and security market; the future applications of Company products; the timeline for a quantum computer being available for commercial use; the use of Company office space; anticipated revenue from Company's products and business; the development of and applicability of quantum technologies; the commercialization of the Company's intellectual property; the general adoption of quantum technologies; adoption of post-quantum cryptographic technologies; the future size of the global post-quantum cryptography market; results, timing and integration of acquisitions and partnerships; the Company's research and development plans; the results from Company research and development; future intellectual property registrations of the Company; the future availability of Company products; and the outcome of disputes.

Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words and phrases such as "will", "may", "is expected to", "anticipates", "estimates", "intends", "plans", "projection", "could", "vision", goals", "objective" and "outlook") are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. In making these forward-looking statements, the Company has made certain assumptions, as contemplated below.

Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual events or results to differ from those expressed or implied by the forward-looking information, including, without limitation: the Company's limited operating history; the Company's negative operating cash flow; compliance and risk management programs; unexpected market disruptions; the Company's dependence on key personnel; the Company's ability to recruit and retain qualified directors, officers and senior employees; market risk for the Company's securities; foreign exchange risk; taxation, litigation, and investment risks; the Company's ability to manage its growth, business plans and international expansion; incorrect estimates of market opportunities; regulatory risks; the Company's executive compensation approaches and practices; the Company's reliance on internally and externally built software, data and intellectual property and the ability of the Company to protect its intellectual property; the Company's ability to find banks and insurance companies willing to provide services; cybersecurity risks; stock exchange listing compliance risk; acquisition integration risk; export controls and national security risks; digital asset and cryptocurrency regulatory risk; the early stage of quantum computing industry; key partnership concentration risk and reliance on a limited number of partners and collaborators; pre-revenue commercialization risk; and risks associated with the enforcement of judgements against foreign persons.

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The above list is not exhaustive of factors that may affect any of the forward-looking information contained in this AIF. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Forward-looking information involves statements about the future and is inherently uncertain, and the actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in this AIF under the heading "Risk Factors" and elsewhere in this AIF. Forward-looking information contained in this AIF is based on the beliefs, expectations and opinions of management of the Company on the date the statements are made, and the Company does not assume any obligation to update forward-looking information, whether as a result of new information, future events or otherwise, other than as required by applicable law. In making the forward-looking statements in this AIF, the Company has applied several material assumptions which may prove to be inaccurate, including, but not limited to, the assumptions that any financing needed to fund the operations of the Company will be available on reasonable terms. Other assumptions are discussed throughout this AIF and, in particular in the "Risk Factors" section of this AIF. For the reasons set forth above, prospective investors should not place undue reliance on forward-looking information.

**CORPORATE STRUCTURE**

<u>**Name, Address and Incorporation**</u>

BTQ Technologies Corp. (previously known as Sonora Gold & Silver Corp.) was incorporated on November 23, 1983 under the *Business Corporations Act* (British Columbia) as "Southern Star Resources Ltd." On February 17, 2023, the Company acquired 100% of the issued and outstanding securities of BTQ AG, a Liechtenstein entity, pursuant to a "reverse takeover transaction" whereby BTQ AG became a wholly owned subsidiary of the Company (the "**Transaction**") and the Company changed its name from "Sonora Gold & Silver Corp." to "BTQ Technologies Corp.".

The Company's corporate headquarters and its registered office is located at 25th Floor, 700 West Georgia Street, Vancouver, British Columbia, Canada, V7Y 1B3.

<u>**Intercorporate Relationships**</u>

BTQ is the sole shareholder of BTQ AG. In July 2021, BTQ AG opened a representative office in Taipei, Taiwan, which was converted into a branch office in November 2022. The branch office was suspended in August 2023 and the Company opened a representative office.

On June 7, 2024, the company incorporated its wholly own subsidiary BTQ Technologies Australia Pty Ltd with the Australian Securities and Investments Commission.

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On June 30, 2025, the Company incorporated its wholly owned subsidiary BTQ Technologies (USA) Ltd., a Delaware corporation.

The following diagram sets out the intercorporate relationships among the Company's material subsidiaries as of the date of this AIF, including the percentage ownership of voting securities and the jurisdiction of formation or existence of each subsidiary.

![](exhibit99-1x002.jpg)

**GENERAL DEVELOPMENT OF THE BUSINESS**

<u>**Three Year History**</u>

<u>Prior to the Transaction</u>

On February 17, 2023, the Company closed the Transaction, which included (a) consolidating its common shares ("**Common Shares**") on the basis of ten pre-consolidation shares to one post-consolidation share (each post-consolidation share, a "Common Share"); (b) issuing 92,000,000 Common Shares to the former BTQ AG shareholders; and (c) changing its name from "Sonora Gold & Silver Corp." to "BTQ Technologies Corp."

In connection with the closing of the Transaction, on February 21, 2023, the Company voluntarily delisted its Common Shares from the TSX Venture Exchange and listed its Common Shares on Cboe Canada Inc. (formerly known as the NEO Exchange Inc.) ("**Cboe**") under the symbol "BTQ".

<u>From Transaction Date to Current Date</u>

On July 23, 2024, the Company entered into an agreement for the acquisition of Radical Semiconductor's Processing-in-Memory Technology Portfolio, advancing its Post-Quantum Cryptography capabilities.

On December 19, 2024, the Company issued 3,355,704 common shares at $2.98 per share for gross proceeds of $10,000,000 pursuant to a brokered listed issuer financing exemption offering. In connection with the financing, the Company incurred share issuance costs of $860,833 and issued 167,785 agent's warrants exercisable at $4.09 per common share expiring on December 19, 2029.

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On March 12, 2025, the Company announced the appointment of Dr. Gavin Brennen as Chief Quantum Officer. Based in Sydney, Australia, Dr. Brennen is driving the Company's global technological roadmap and strategy for quantum computing.

On April 9, 2025, the Company announced a strategic partnership with QPerfect SAS ("**QPerfect**"), a neutral atom quantum computing company based in Strasbourg, France, to accelerate neutral atom quantum computing applications.

On April 29, 2025, the Company filed a short form base shelf prospectus (the "**Base Shelf Prospectus**") to provide flexibility for future capital raises.

On June 24, 2025, the Company unveiled its Quantum Stablecoin Settlement Network ("**QSSN**"), a next-generation framework in development to help banks, payment providers, and digital asset platforms issue and manage stablecoins with built-in protection against quantum-era cybersecurity threats.

On July 11, 2025, the Company closed a $40,000,000 prospectus offering (the "2025 Offering") of 5,555,555 Common Shares at a price of $7.20 per Common Share pursuant to a prospectus supplement to the Base Shelf Prospectus dated July 9, 2025, led by a new fundamental long-term institutional investor. A.G.P. Canada Investments ULC acted as sole bookrunner and agent (the "Agent").

On September 22, 2025, the Company amended the Base Shelf Prospectus to, among other things, increase the number of securities which may be offered thereunder from $100,000,000 to $300,000,000.

On September 26, 2025, the Company commenced trading on the Nasdaq Global Market ("Nasdaq"), marking the next phase of the Company's growth and providing a broader investor base access to the Company.

On October 27, 2025, the Company entered into a Share Subscription Agreement and a Development Service Agreement with ICTK Co., Ltd. (the "**ICTK Agreements**"), a technology company located in the Republic of Korea. Under the Share Subscription Agreement, the Company acquired 452,058 common shares of ICTK for KRW 7,180,489,272 (approximately $6.8 million) on December 19, 2025. Under the Development Service Agreement, the Company has engaged ICTK to carry out the development work (the "ICTK Services") related to QCIM IP verification and development of a quantum security chip incorporating QCIM application for US$10,000,000. The amount is to be paid by the Company in instalments based on the Company's acceptance of each relevant milestone. The agreement is limited to the provision of technology and know-how necessary for the performance of the ICTK Services with respect to each party's background technology and does not include the use of the deliverables of this agreement for commercial purposes.

In October 2025, the Company was added to the Samsung Asset Management KoAct Global Quantum Computing ETF (KOSDAQ). In November 2025, the Company was added to the MSCI Canada Small Cap Index effective November 25, 2025. In December 2025, the Company was added to the Defiance Quantum ETF (NASDAQ: QTUM).

On November 7, 2025, the Company entered into an Ordinary Share Subscription Agreement and acquired 217,865 shares of QPerfect, a technology company located in Strasbourg, France, for $3,263,521 (€2,000,000) which resulted in a 15.29% interest. Concurrent with the completion of this investment, the Company provided notice to exercise its option to acquire the remaining shares of QPerfect (the "QPerfect Acquisition") which will be paid in cash and common shares of the Company. The closing of the QPerfect Acquisition is subject to France's foreign direct investment approval process.

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On November 11, 2025, BTQ announced it had exercised its option to acquire QPerfect, a leading neutral atom quantum computing company, based at the heart of the European Center for Quantum Science (CESQ) in Strasbourg, France. BTQ initially acquired a 15.29% interest for 2 million Euros.

<u>Subsequent to Year-End, the Following Material Events Occurred:</u>

On January 5, 2026, BTQ announced that Lionel de Saint-Exupéry had been appointed to the Company's board of directors (the "**Board**") and to serve as Chair of the Audit Committee.

On January 12, 2026, the Company launched the Bitcoin Quantum testnet, a public, permissionless quantum-safe Bitcoin network, timed to the 17th anniversary of Bitcoin's genesis block.

On January 21, 2026, the Company announced a strategic collaboration with Taiwan's Industrial Technology Research Institute ("**ITRI**") intended to validate the QCIM chip in silicon, representing a key milestone toward commercialization.

On February 25, 2026, the Company announced the opening of a dedicated commercialization hub in New York, New York and a significant expansion of its QCIM engineering team, including senior hires.

**DESCRIPTION OF THE BUSINESS**

<u>**General**</u>

BTQ is aiming to be a vertically integrated quantum technology company focused on securing mission-critical networks against the emerging threat of quantum computing. The Company develops and aims to deliver post-quantum cryptographic solutions across three complementary pillars: post-quantum hardware, post-quantum software for blockchain and financial infrastructure, and neutral atom quantum computing.

BTQ was founded by a group of experienced post-quantum cryptographers to address the security threat that large-scale quantum computers pose to existing cryptographic systems. While the Company's origins lie in blockchain-focused post-quantum cryptography, during 2025 the Company changed its strategic goal to to become a broader quantum-safe cybersecurity platform with commercial product offerings, institutional partnerships, and a vertically integrated quantum computing capability.

The Company's hardware program centers on QCIM, a chip being co-developed with ICTK. Under the Development Service Agreement, the Company has engaged ICTK to carry out the development work related to QCIM IP verification and development of a quantum security chip incorporating QCIM application for US$10,000,000. The Company's software offerings are expected to include Bitcoin Quantum, the first quantum-safe fork of Bitcoin using NIST-standardized post-quantum cryptography, and QSSN, a quantum-secure stablecoin settlement network providing institutional-grade wallet infrastructure for EVM-compatible blockchains.

BTQ is listed on the Nasdaq and Cboe Canada under the symbol "BTQ". The Company maintains operations in Canada, the United States (New York, San Francisco, and Portland), Australia, Taiwan, and South Korea.

<u>**Principal Products and Services**</u>

BTQ has one reportable segment, research and development of computer-based technology related to post-quantum cryptography. This segment has two main areas of focus, hardware and software. During 2025, the Company streamlined its product portfolio to focus on its highest-value commercial opportunities, consolidating its hardware programs under the QCIM product line, launching two new software products (Bitcoin Quantum and QSSN), and deprecating earlier-stage research programs in order to consolidate focus around the Company's strategic direction.

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**Summary**

The Company did not generate revenue from any product or service category representing 15% or more of consolidated revenue during the financial years ended December 31, 2025 and 2024

*Quantum Compute-in-Memory (QCIM)*

QCIM is the Company's flagship hardware product: a quantum-secure compute-in-memory chip designed to implement fast, crypto-agile, energy-efficient post-quantum cryptography directly in silicon. QCIM supports NIST-standardized post-quantum cryptographic algorithms, including ML-KEM and ML-DSA, in a compact, low-power form factor suitable for deployment in constrained environments such as smart cards, IoT endpoints, mobile devices, and hardware security modules. The chip is designed to support both post-quantum and traditional encryption methods, providing cryptographic agility as industry standards continue to evolve. The technology builds upon patents acquired from Radical Semiconductor and their founding team.

During 2025, the QCIM program advanced significantly from its prior preliminary research phase. In September 2025, Radical Semiconductor co-founders Sean Hackett and Zach Belateche joined BTQ full-time, with Sean Hackett leading silicon product development and Zach Belateche leading hardware security. With these additions, the Company intends to accelerate commercialization of the QCIM program. In October 2025, the Company signed the ICTK Agreements with ICTK, a leading South Korean secure-element manufacturer, to co-develop the QCIM chip. The agreements cover joint design, validation, tape-out, certification, and productization, with BTQ making an equity investment in ICTK

As of December 31, 2025, QCIM was in the pre-silicon validation phase, with architecture definition and prototyping underway. Subsequent to year-end 2025, the Company announced a 2026 collaboration with Taiwan's ITRI to validate QCIM in silicon and opened a commercialization hub in New York, New York, staffed with senior engineers to accelerate the path toward production-ready silicon.

The Company targets QCIM for deployment in high-assurance applications including cold and hardware wallets for digital assets, mobile authentication and fintech security, IoT endpoint protection, payment gateway infrastructure, and defense systems. The Company expects to deliver initial hardware to design partners on physical circuit boards for testing during 2026, with industry-specific certifications and broader commercialization to follow.

*Bitcoin Quantum*

Bitcoin Quantum is a permissionless, quantum-safe fork of Bitcoin that replaces Bitcoin's quantum-vulnerable Elliptic Curve Digital Signature Algorithm ("**ECDSA**") with Module-Lattice Digital Signature Algorithm ("**ML-DSA**"), the NIST-standardized post-quantum digital signature scheme published as Federal Information Processing Standard 204 in August 2024. Bitcoin Quantum is built on Bitcoin Core's proven codebase and incorporates a 64 MiB block size limit to accommodate post-quantum signatures, which are approximately 70 times larger than their classical counterparts, as well as a Post-Quantum Key infrastructure that enables the integration of future quantum-resistant signature algorithms as they become available.

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Bitcoin Quantum addresses an increasingly urgent security concern: approximately 6.26 million BTC, representing approximately $750 billion in value, currently reside in addresses with exposed public keys that are vulnerable to future quantum attack. The product provides a production-grade proving ground for the cryptocurrency ecosystem to test quantum-resistant transactions and infrastructure without risking the Bitcoin mainnet, while also serving as a standalone quantum-safe network.

In October 2025, the Company announced the first successful demonstration of Bitcoin Quantum Core Release 0.2, completing the full flow of quantum-safe wallet creation, transaction signing and verification, and mining. The Company also established the BTQ Foundation, co-chaired by BTQ, to coordinate industry-wide quantum defense efforts including open-source development, consensus building, standards setting, and migration frameworks. In the fourth quarter of 2025, the Company completed security auditing and preparation for testnet launch.

Subsequent to the 2025 year-end, on January 12, 2026, the Company launched the Bitcoin Quantum testnet, a public, permissionless network with a block explorer and mining pool, timed to the 17th anniversary of Bitcoin's genesis block. Leading digital asset research firm Delphi Digital published research characterizing Bitcoin Quantum as a "quantum canary" network, a critical testbed for the industry's quantum transition.

The Company is building multiple expected revenue streams around Bitcoin Quantum. The Company anticipates developing additional revenue opportunities through security-as-a-service models, premium settlement layers, and quantum certification services as the network matures.

Bitcoin Quantum represents the commercial evolution of the Company's prior quantum proof-of-work research conducted in collaboration with Macquarie University, which explored the application of quantum computing to blockchain proof-of-work mechanisms. The Company's published roadmap targets enterprise pilot programs with institutional digital asset managers in Q1 2026, expects mainnet launch with migration tools in Q2 2026, and expects integration with exchanges and custody providers during 2026-2027.

*Quantum Stablecoin Settlement Network (QSSN)*

QSSN is a quantum-secure validation and wallet infrastructure product designed to enable banks, payment providers, and digital asset platforms to issue and manage stablecoins with built-in protection against quantum-era cybersecurity threats. The product provides quantum-safe smart account wallets for EVM-compatible blockchain networks, using ML-DSA post-quantum cryptography within the ERC-4337 account abstraction standard. This approach delivers familiar wallet user experience with post-quantum security, requires no modifications to underlying blockchain protocols, and protects institutional customers against "harvest now, decrypt later" attacks in which adversaries capture encrypted data today for future quantum decryption.

QSSN operates as a specialized validation service layer rather than a new blockchain. Validator nodes generate quantum-secure attestations using dual-signature mechanisms that combine classical ECDSA signatures with post-quantum ML-DSA signatures, ensuring backward compatibility with existing systems while providing quantum resistance. Economic coordination, including fee collection, distribution, and staking, is managed through smart contracts deployed on established platforms, leveraging battle-tested infrastructure rather than building new financial primitives. The system is designed to support institutional-scale throughput and maintains cryptographic proofs of all validations for audit and regulatory compliance purposes.

The Company unveiled QSSN in June 2025 and subsequently commenced proof-of-concept deployments with Danal and Finger Inc. Group in South Korea. The Company intends to develop revenue opportunities from QSSN through validator node licensing fees, transaction-based validation fees with flexible pricing models supporting both crypto-native and fiat-linked pricing, and staking mechanisms that enable token holders to participate in network security.

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*QPerfect*

In April 2025, the Company entered into a strategic partnership with QPerfect, a neutral atom quantum computing company based at the European Center for Quantum Science ("CESQ") in Strasbourg, France. On November 7, 2025, the Company entered into an Ordinary Share Subscription Agreement and acquired 217,865 shares of QPerfect for $3,263,521 (€2,000,000) which resulted in a 15.29% interest. Concurrent with the completion of this investment, the Company provided notice to exercise its option to acquire the remaining shares of QPerfect which will be paid in cash and common shares of the Company. The closing of the QPerfect Acquisition is subject to certain conditions, including France's foreign direct investment approval process.

QPerfect's principal product is MIMIQ™, a high-performance quantum computing emulator capable of simulating circuits of up to thousands of qubits and millions of gates. Subsequent to the 2025 year-end, QPerfect's MIMIQ was integrated into SDT's QUREKA™ platform to launch a commercially available cloud-based quantum emulation service operating on secure European cloud infrastructure.

If the QPerfect acquisition is completed, it is expected to provide BTQ with vertically integrated quantum computing capabilities that complement and strengthen the Company's hardware and software technologies, including quantum error correction research applicable to QCIM development, quantum sensing capabilities relevant to precision navigation and timing applications, and a European research and development base within one of Europe's leading quantum science institutions.

*Other research and development details*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company conducts its research and development activities primarily in-house through dedicated engineering teams, supplemented by strategic institutional partnerships for specialized capabilities. The Company's QCIM hardware program is being developed by its internal digital design, verification, and applied cryptography teams, with silicon validation and fabrication subcontracted to the Industrial Technology Research Institute ("ITRI") and Taiwan Semiconductor Manufacturing Company ("TSMC"). The Company's software products, Bitcoin Quantum and QSSN, are being developed entirely by in-house engineering teams, with all intellectual property retained by the Company.

The Company's research and development programs require specialized skills and knowledge across several disciplines, including digital design engineering and chip architecture, design verification engineering, embedded software development, applied cryptography and post-quantum cryptographic methods, hardware security and tamper-proofing, blockchain protocol engineering, and enterprise software development. The Company has assembled teams with this expertise across offices in New York, New York, Portland, Oregon, and San Francisco, California. Semiconductor fabrication expertise, which the Company does not currently maintain in-house, is accessed through its partnership with ITRI and TSMC. The Company believes it has access to the specialized skills and knowledge necessary to execute its current research and development programs.

The Company has budgeted approximately $4.5 million in aggregate for research and development activities across its product lines in fiscal 2026, allocated as follows: approximately $3.4 million for QCIM hardware development (including personnel, facilities, and ITRI/TSMC fabrication costs), approximately $4 million for ICTK Services; approximately $903,000 for Bitcoin Quantum protocol development, and approximately $255,000 for QSSN development.

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*Deprecated Products*

During fiscal 2025, the Company streamlined its product portfolio by discontinuing or redirecting certain earlier-stage research programs. The Company's Post-quantum Digital Signature Compression Algorithm, previously in development to provide post-quantum scaling services for existing blockchains, was discontinued as the Company refocused its software efforts on Bitcoin Quantum and QSSN. The underlying intellectual property and patent applications remain within the Company's portfolio. The Company's Keelung zero-knowledge programming language, which was open-sourced in 2023, remains available in maintenance mode, with the Company's zero-knowledge cryptography research capabilities redirected to support its current product initiatives. The Company's quantum proof-of-work research, conducted in collaboration with Macquarie University, has been integrated into the Bitcoin Quantum initiative, which represents the commercial evolution of this research program.

**Industry Background**

The rapid advancement of quantum computing represents an emerging and significant threat to the cryptographic systems that underpin global digital infrastructure. Quantum computers, leveraging principles of quantum mechanics, have the potential to break widely deployed public-key cryptographic algorithms, including RSA and Elliptic Curve Cryptography, that currently secure internet communications, financial transactions, government systems, and blockchain networks. While a cryptanalytically relevant quantum computer ("**CRQC**") capable of breaking these algorithms does not yet exist, steady advances in the field and continued progress in error correction have compressed expert timelines, with some researchers now estimating that such a machine could emerge by the end of the decade.

The threat is compounded by so-called "harvest now, decrypt later" attacks, in which adversaries capture and store encrypted data today with the expectation of decrypting it once sufficiently powerful quantum computers become available. This strategy means that sensitive data with a long shelf life, including financial records, health data, intellectual property, and blockchain transaction histories, is already at risk even before a CRQC is operational. A 2025 Federal Reserve research paper warned that quantum-capable adversaries could retroactively compromise the privacy and ownership records embedded in Bitcoin's public ledger.

In response, governments and standards bodies have accelerated efforts to transition to quantum-resistant cryptography. In August 2024, the U.S. National Institute of Standards and Technology ("**NIST**") finalized and published the first three post-quantum cryptographic standards: FIPS 203 (ML-KEM, for key encapsulation), FIPS 204 (ML-DSA, for digital signatures), and FIPS 205 (SLH-DSA, a hash-based signature backup). In March 2025, NIST selected HQC as an additional backup key encapsulation standard based on error-correcting codes, with a draft standard expected in 2026 and finalization in 2027. These publications mark the conclusion of NIST's multi-year Post-Quantum Cryptography Standardization Project and provide the algorithmic foundation upon which the Company's products are built.

The U.S. government has established binding migration timelines through National Security Memorandum 10 ("**NSM-10**"), issued in May 2022, which requires all federal systems to complete their transition to quantum-resistant cryptography by 2035. The Office of Management and Budget has projected a government-wide migration cost of approximately US$7.1 billion. The NSA's Commercial National Security Algorithm Suite 2.0 ("**CNSA 2.0**") mandates that all new National Security System acquisitions be compliant with post-quantum standards by January 2027, with full migration of existing systems by 2033. NIST's transition guidance further calls for deprecation of quantum-vulnerable algorithms at the 112-bit security level by 2030 and disallowance of all quantum-vulnerable algorithms by 2035. The European Commission has directed all 27 member states to initiate PQC migration by the end of 2026, with completion of critical infrastructure protection by 2030.

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These regulatory mandates are creating significant market demand. Third-party market research estimates for the global post-quantum cryptography market range from approximately US$0.4-1.7 billion in 2025, growing at compound annual growth rates of 37-46% to reach US$2.8-9.4 billion by 2030-2033, depending on the research provider and scope of measurement. The estimated market spans quantum-resistant algorithms, cryptographic libraries, authentication solutions, hardware security modules, and migration services, with the banking, financial services, government, and defense sectors anticipated to lead adoption. Lattice-based cryptography, the mathematical foundation underlying the Company's ML-KEM and ML-DSA implementations, represents the dominant algorithm family with approximately 49% market share.

For blockchain networks specifically, the quantum threat is acute. Research by the Cambridge Centre for Alternative Finance found that as of 2025, 3-5 million BTC (14-24% of total supply) are stored in quantum-vulnerable addresses with exposed public keys. The Company estimates that approximately 6.26 million BTC, representing $750 billion in value, face potential quantum exposure. Despite this risk, the same Cambridge research found that actual adoption of post-quantum algorithms in blockchain codebases remains negligible, with traditional cryptographic algorithms accounting for 98.7% of adoption events across major platforms through 2025. This gap between the recognized threat and the pace of migration represents a significant commercial opportunity for companies, including BTQ, that can deliver production-ready quantum-safe blockchain solutions.

**Growth Strategy**

The Company's growth strategy is built on commercializing its three technology pillars: hardware, software, and quantum computing, through a combination of partnership-driven development, geographic expansion, and sequential product launches designed to generate revenue from software while building toward longer-term hardware commercialization.

*Hardware Commercialization through Strategic Partnerships*

The Company's path to QCIM hardware commercialization is anchored by its US$15 million joint development agreement with ICTK Co., Ltd. This partnership provides BTQ with access to ICTK's established semiconductor manufacturing capabilities, supply chain relationships, and industry certifications, significantly de-risking the chip development process relative to pursuing independent tape-out and fabrication. The Company expects to progress through silicon validation with ITRI in 2026, deliver initial hardware to design partners for board-level testing, and then pursue industry-specific certifications required for deployment in target markets including financial services, defense, and IoT. The Company intends to expand its addressable market by targeting multiple form factors and use cases, from secure element chips for hardware wallets and smart cards to higher-performance modules for hardware security modules and payment infrastructure.

The QCIM program is currently in the pre-silicon validation stage. The Company is targeting a first version release of its soft IP block in June 2026, followed by test chip fabrication and post-silicon validation in the second half of 2026. The Company has budgeted approximately $3.4 million for QCIM research and development activities in fiscal 2026, covering personnel costs (including digital design engineers, design verification engineers, embedded software engineers, and applied cryptographers), facilities in New York, New York; Portland, Oregon; and San Francisco, California; and fabrication costs with ITRI and TSMC.

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The Company is pursuing a dual commercialization strategy for QCIM. First, the Company intends to license its soft IP block to chip designers and semiconductor companies. Following the initial IP block release, the Company plans to initiate pilot projects and qualification processes with potential customers, which will commence the sales cycle for soft IP licensing. Second, the Company is developing its own QCIM test chip through ITRI and TSMC. In parallel with silicon validation, the Company intends to begin its sales cycle for the hardware product. The Company expects the full hardware sales cycle to take approximately one to two years to complete, during which period the Company may generate revenue through consulting services to assist enterprises with their post-quantum cryptography migration plans.

The Company plans to scale its sales and business development team to target high-interest regions including the United States, Europe, and Asia. As the Company progresses through validation and industry-specific certifications (including financial services, defense, and IoT), customer adoption is expected to accelerate.

*Software Go-to-Market*

The Company's two software products, Bitcoin Quantum and QSSN, are designed to generate revenue in advance of QCIM hardware commercialization.

Bitcoin Quantum's mining pool model provides recurring transaction-based revenue from network operation, while the accumulation of BTQ tokens as a treasury asset provides potential appreciation value as the network scales. The Company's published roadmap targets enterprise pilot programs with institutional digital asset managers, followed by mainnet launch and integration with exchanges and custody providers.

QSSN is developed entirely in-house through independent contractor arrangements, with all intellectual property retained by the Company. Business development and partnership activities are led by the Company's South Korea-based team, which has secured institutional pilot projects for QSSN integration with major technology firms in the Republic of Korea. Development requires specialized skills in blockchain engineering, post-quantum cryptography, enterprise software sales, and regulatory and compliance expertise relating to banking and financial services, all of which are available within the Company's current team.

QSSN is currently at the proof-of-concept stage, with institutional pilot projects underway with major technology firms in South Korea. Following the conclusion of initial pilot projects, the Company intends to deepen integrations with major banks and expand its geographic presence into the United States and Canada. The Company has budgeted approximately $255,000 for QSSN research and development in fiscal 2026. Revenue from QSSN is expected to be generated through validator node licensing, transaction-based validation fees, and staking mechanisms as the platform progresses from pilot deployments to commercial adoption.

QSSN's institutional focus on banks entering the stablecoin market provides a complementary enterprise sales channel, with revenue from validator node licensing, transaction-based validation fees, and staking mechanisms. The Company's initial proof-of-concept deployments in the Republic of Korea are intended to serve as reference implementations for broader institutional adoption.

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Bitcoin Quantum is developed entirely in-house by a dedicated engineering team through independent contractor arrangements, with all intellectual property retained by the Company. The core protocol development team operates independently from the Company's other software programs. Development requires specialized skills in blockchain protocol engineering, post-quantum cryptography, and distributed systems architecture, all of which are available within the Company's current team.

The Bitcoin Quantum protocol is currently in its third testnet iteration (v3), having undergone several rounds of testing and protocol strengthening. The current development milestone for the fourth testnet version (v4) is network hardening and monitoring. The Company is tracking toward expected mainnet launch in early summer 2026, with exchange integration programs expected to commence over the coming months. The Company has budgeted approximately $903,000 for Bitcoin Quantum research and development in fiscal 2026.

*Quantum Emulation Platform*

Through the anticipated completion of the QPerfect Acquisition, the Company will operate a commercially active quantum computing emulation platform. The integration of MIMIQ into SDT's QUREKA platform provides immediate commercial revenue and positions BTQ within the European quantum computing ecosystem. The Company intends to leverage QPerfect's capabilities across its product lines, including quantum error correction research to support QCIM development, quantum sensing for precision applications, and cryptographic research to strengthen its PQC algorithm implementations.

*Geographic and Team Expansion*

The Company expanded its operational footprint significantly during fiscal 2025 and subsequent to the 2025 year-end. The establishment of a commercialization hub in New York, New York, staffed with senior engineers from leading technology companies, provides proximity to the financial services institutions that represent primary customers for both QCIM and QSSN. The anticipated QPerfect acquisition will provide a European base within the CESQ research ecosystem in Strasbourg, France. The ICTK partnership strengthens the Company's presence in the Republic of Korea, while the Company's Chief Quantum Officer maintains the Company's research connection to the Australian quantum computing ecosystem. The Company intends to continue building its US-based team with particular focus on cryptography, silicon product development, and enterprise sales capabilities.

*Strategic Acquisitions and Investments* 

The Company may pursue additional acquisitions or investments that complement its existing product lines or accelerate its path to commercialization, with particular focus on technologies that strengthen its hardware capabilities, expand its software platform, or provide access to new customer segments or geographic markets.

**Competitive Conditions**

The post-quantum cryptography market is emerging and evolving rapidly, driven by the finalization of NIST PQC standards and accelerating government migration mandates. The Company competes in three distinct but related segments, PQC hardware, quantum-safe blockchain software, and quantum computing. Each of these segments has its own competitive dynamics.

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*PQC Hardware*

The market for PQC-enabled hardware security chips includes both well-capitalized semiconductor incumbents and specialized PQC startups. NXP Semiconductors (NASDAQ: NXPI), a global leader in secure connectivity solutions for embedded applications, has integrated post-quantum cryptographic capabilities into its product lines and was recognized as a leading vendor in PQC market assessments. Infineon Technologies (XETRA: IFX) similarly incorporates PQC into its security chip portfolio, particularly for automotive and IoT applications. Among private companies, PQShield Ltd. (Oxford, UK) is a notable competitor that raised funding to commercialize PQC solutions for both hardware IP and software. PQShield co-authored several of NIST's standardized algorithms and partners with semiconductor companies including AMD, SiFive, and Lattice Semiconductor. Other participants include Thales Group (Euronext: HO) through its hardware security module products, and IDEMIA in the secure identity space. The Company believes that its QCIM product is differentiated by its compute-in-memory architecture, which is specifically optimized for the computationally intensive lattice-based operations required by ML-KEM and ML-DSA, and by its vertical integration with the Company's software products.

*Quantum-Safe Blockchain*

The Company is not aware of any competitor that has delivered a production-ready, NIST-compliant quantum-safe fork of Bitcoin using ML-DSA. Quantum Resistant Ledger ("**QRL**") has operated a hash-based (XMSS) quantum-resistant blockchain since 2018 and is developing a proof-of-stake upgrade with SPHINCS+ signatures and EVM compatibility. QANplatform offers a Layer 1 blockchain with dual ECDSA/Dilithium signatures and EVM compatibility. Algorand demonstrated Falcon-1024 signed mainnet transactions in November 2025. However, these projects are distinct from Bitcoin Quantum in that they are independent blockchain platforms rather than Bitcoin-derived networks designed to serve as quantum-safe proving grounds and potential migration paths for the existing Bitcoin ecosystem. For QSSN, the Company competes broadly with companies offering post-quantum solutions for financial infrastructure, though the Company believes it is an early mover in applying PQC specifically to stablecoin settlement and institutional wallet infrastructure.

*Quantum Computing*

The quantum computing market is served by well-funded public and private companies including IonQ, Inc. (NYSE: IONQ), Rigetti Computing, Inc. (NASDAQ: RGTI), and D-Wave Quantum Inc. (NYSE: QBTS), among others. QPerfect's neutral atom architecture differentiates it from these competitors, and its MIMIQ emulator occupies a specialized niche in quantum circuit emulation rather than competing directly with general-purpose quantum hardware providers. The Company believes QPerfect's primary competitive advantage lies in its integration with BTQ's broader product portfolio and its position within the European quantum research ecosystem.

*Integrated Approach*

The Company believes its principal competitive differentiator is its vertically integrated approach, spanning PQC hardware, quantum-safe blockchain software, and quantum computing capabilities within a single publicly listed entity. To the Company's knowledge, no other publicly traded company offers this combination of capabilities. This integration enables the Company to pursue synergies across product lines. For example, QCIM hardware serving as the security foundation for QSSN validator nodes, or QPerfect's quantum computing research informing the cryptographic design of Bitcoin Quantum, and to present institutional customers with a unified quantum-security platform rather than requiring them to integrate solutions from multiple vendors.

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**Intellectual Property** 

The Company's intellectual property portfolio includes patents and patent applications across multiple jurisdictions, covering its compute-in-memory architecture, processing-in-memory technologies, and blockchain-related cryptographic innovations.

During 2024, the Company's IP portfolio was strengthened through the acquisition of Radical Semiconductor's processing-in-memory patents, which form a key component of the QCIM product's technical foundation. The Company's portfolio also includes intellectual property acquired from CimTech Technology Co., Ltd. in January 2025, covering compute-in-memory implementations relevant to the QCIM program.

The Company holds a European patent application for an "Improved Blockchain System and Method" relating to Falcon signature aggregation, as well as additional patent applications in Canada, the United States, and Europe. The Company also contributes to open-source projects, including the Bitcoin Quantum testnet codebase and the Keelung zero-knowledge programming language, which remain available under open-source licenses.

The Company relies on a combination of patent protection, trade secrets, contractual provisions, and technical measures to protect its intellectual property. No assurance can be given that the Company's intellectual property rights will be sufficient to protect the Company against competitors or that such rights will not be challenged, invalidated, or circumvented.

The Company protects its intellectual property through various strategies, including non-disclosure agreements and applying for patents, when appropriate. Currently, the Company has the following patents and patent applications.

<u>**Current Patents**</u>

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;**Name** | &nbsp;&nbsp;**Jurisdiction/s** | &nbsp;&nbsp;**Application No.** <br>**(Patent No., if different<br>than Application No.)** | &nbsp;&nbsp;**Status** |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | Canada | CA 3078558 | Expiring on October 8, 2038\* |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | Europe | EP 18800260.4 (EP 3692681) | Expiring on October 8, 2038\* |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | Great Britain | EP 3692681 | Expiring on October 8, 2038\* |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | Unitary Patent | EP 3692681 | Expiring on October 8, 2038\* |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | United States | US 16/754,055 (US 11477017) | Expiring on October 8, 2038\* |
| A SYSTEM AND METHOD FOR QUANTUM-SAFE AUTHENTICATION, ENCRYPTION AND DECRYPTION OF INFORMATION | United States | US 17/930,681 (US 11991275) | Expiring on December 17, 2038\* |
| NON-VOLATILE STORAGE OF SECURE DATA IN 6T SRAM CELLS USING HOT CARRIER INJECTION | United States | US 18/302,667 (US 12361987) | Expiring on August 21, 2043\* |

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\*Subject to payment of all periodic patent annuity fees.

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<u>**Pending Patent Applications**</u>**:**

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| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;**Name** | &nbsp;&nbsp;**Jurisdiction/s** | &nbsp;&nbsp;**Patent Application<br>No.** | &nbsp;&nbsp;**Status** | &nbsp;&nbsp;**Maximum Patent term<br>Subject to allowance<br>and payment of<br>periodic patent annuity<br>fees** |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | Australia | AU 2023327708 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | Canada | CA 3,265,180 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | China | CN 2023800726237 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | Europe | EP 23754332.7 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | Hong-Kong | HK 62025116113.4 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | Japan | JP 2025-508665 | Pending | August 14, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM (POST-QUANTUM AGGREGATE SIGNATURES) AND METHOD | United States | US 19/103296 | Pending | August 14, 2043\* |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | Australia | AU 2023410365 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | Canada | CA 3,277,359 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | China | CN 2023800942039 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | Europe | EP 23833134.2 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | India | IN 202517067614 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | Japan | JP 2025-535329 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | Singapore | SG 11202504165X | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | South Korea | KR 10-2025-7024285 | Pending | December 19, 2043 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (DELAYED PROOF OF VALIDITY) | United States | 19/140,064 | Pending | December 19, 2043\* |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | Australia | AU 2024281481 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | Canada | CA 3,293,054 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | China | To be confirmed | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | Europe | EP 24728061.3 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | India | IN 202517128799 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | Japan | JP 2025-568813 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | Singapore | SG 11202507877P | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | South Korea | KR 10-2025-7042843 | Pending | May 27, 2044 |
| IMPROVED BLOCKCHAIN SYSTEM AND METHOD (QUANTUM ANALOGUES OF PROOF OF WORK SCHEMES) | United States | US 19/486,584 | Pending | May 27, 2044\* |
| SYSTEM AND METHOD FOR QUANTUM RANDOM NUMBER GENERATOR (QRNG) | Europe | EP 24199620.6 | Pending | September 10, 2044 |
| SYSTEM AND METHOD FOR QUANTUM RANDOM NUMBER GENERATOR (QRNG) | Patent Cooperation Treaty | PCT/EP2025/075823 | Pending | Expires on March/April 10, 2027 |
| NON-VOLATILE STORAGE OF SECURE DATA IN 6T SRAM CELLS USING HOT CARRIER INJECTION | United States | US 19/302,736 | Pending | April 18, 2043\* |
| HIGH-RELIABILITY PROCESSING-IN-MEMORY WITH TRANSPOSE SUPPORT USING SPLIT-6T SRAM | United States | US 18/302,674 | Pending | April 18, 2043\* |
| IN-MEMORY HIGH PARALLELISM BIT-SERIAL POLYNOMIAL MULTIPLICATION | United States | US 18/302,679 | Pending | April 18, 2043\* |
| IN-MEMORY REDUNDANT BINARY ARITHMETIC ON WIDE BITWIDTH INTEGERS | United States | US 18/302,684 | Pending | April 18, 2043\* |

---

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| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;**Name** | &nbsp;&nbsp;**Jurisdiction/s** | &nbsp;&nbsp;**Patent Application<br>No.** | &nbsp;&nbsp;**Status** | &nbsp;&nbsp;**Maximum Patent term<br>Subject to allowance<br>and payment of<br>periodic patent annuity<br>fees** |
| QUANTUM COMPUTE-IN-MEMORY HARDWARE SECURE ENCLAVE AND METHODS FOR USING SAME | United States | US 63/977,405 | Pending | Provisional application will expire February 6, 2027 (Formalized patent application will be filed before then) |
| VLIW AND MASKING IN NEAR-MEMORY LOGIC FOR QCIM | United States | US 63/998,199 | Pending | Provisional application will expire March 6, 2027 (Formalized patent application will be filed before then) |
| SIDE-CHANNEL SECURE BIT-SERIAL, WORD-PARALLEL CRYPTOGRAPHIC ACCELERATOR | United States | US 63/998,315 | Pending | Provisional application will expire March 6, 2027 (Formalized patent application will be filed before then) |

---

\*Subject to patent term extension.

Note: \* All expiry dates are subject to payment of periodic patent annuity fees.

**Employees**

As of December 31, 2025, the Company employed approximately 35 persons, including full-time employees and contractors. The Company's workforce is distributed across multiple geographies, including Vancouver, Canada (corporate headquarters); New York, New York (commercialization hub); San Francisco, California and Portland, Oregon (US engineering); the Republic of Korea (partnership operations); Taiwan (semicon partnerships) and Australia (quantum research hub). During fiscal 2025, the Company made several key additions to its leadership team, including Dr. Gavin Brennen as Chief Quantum Officer (March 2025), Sean Hackett as Head of Silicon Product (September 2025), and Zach Belateche as Head of Hardware Security (September 2025). Subsequent to year-end, the Company added senior engineers to staff its New York commercialization hub. None of the Company's employees are represented by a labor union or subject to a collective bargaining agreement. The Company's relations with its employees are in good standing.

The Company solidified the three pillars that will form its long-term strategy during a transformational year for the Company in 2025. Building on the acquisition of the Radical Semiconductor IP in September 2024, the Company formalized its QCIM division with the previous Radical co-founders leading the talent acquisition to support commercialization of the product. The Company also progressed in its go-to-market efforts and hired technical employees for its QSSN division led by President and Head of Innovation, Chris Tam. Finally, pending regulatory approval of the acquisition, BTQ plans to integrate QPerfect as its third division and jointly develop the roadmap towards building commercializable products in the neutral atom quantum computing and quantum emulation industries.

**Cycles** 

BTQ does not expect the development of its proprietary hardware and software to be subject to cyclical or seasonal forces.

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**Economic Dependence** 

As of December 31, 2025, BTQ does not possess any contracts upon which its business is substantially dependent. This absence is attributed to the Company being in the research and development stage, where the Company's primary focus lies in the exploration and advancement of innovative solutions. Consequently, there are no prevailing contracts in place for the sale of a significant portion of Company's products or services, nor for the acquisition of substantial requirements of goods, services, or raw materials. Furthermore, the Company does not currently hold any franchise, license, or other agreements pertaining to the use of patents, formulas, trade secrets, processes, or trade names that are indispensable to its operations. Given the Company's developmental status, the Company's business remains centred on refining and enhancing its offerings, thereby precluding the existence of contractual dependencies at this juncture.

**Changes to Contracts** 

It is not expected that the business of the Company will be affected by the renegotiation or termination of contracts or sub-contracts in the current financial year.

**Environmental Protection**

In the current financial year and for future years, the Company anticipates no significant financial or operational effects stemming from environmental protection requirements. As BTQ primarily engages in research and development, with a strong focus on the development of hardware and software solutions, its operations are not subject to substantial environmental compliance obligations. Thus, the Company does not foresee any substantial impact on its capital expenditures, profit or loss, or competitive position as a result of environmental protection requirements. The Company's ongoing efforts center on the advancement of innovative technologies and solutions, and while it remains committed to environmental sustainability, its current business activities and strategic priorities do not expose us to substantial environmental compliance costs or obligations.

**Foreign Operations** 

The Company maintains operations across multiple geographies. In the United States, the Company established a commercialization hub in New York, New York in January 2026, with additional engineering personnel in San Francisco California and Portland, Oregon. In France, the Company has an investment in QPerfect, based at the European Center for Quantum Science in Strasbourg. In the Republic of Korea, the Company maintains partnership operations in connection with its ICTK joint development agreement and QSSN proof-of-concept deployments. In Taiwan, although the Company's former branch office was closed in October 2024 and operations were transitioned, the Company maintains semiconductor partnership activities in Taiwan through its ITRI collaboration. In Australia, the Company's Chief Quantum Officer maintains the Company's research connection to the Australian quantum computing ecosystem.

BTQ also has consultants working for the Company in Canada, the South Korea,, United States, Israel, and Australia. The Company also maintains an office space in New York, New York, Portland, Oregon, and Sydney, Australia for use by its team of research employees/consultants located at these locations.

**Lending and Grants** 

The Company does not have any dedicated investment policies or investment restrictions.

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**Reorganizations**

The Company completed the Transaction in February 2023. See "General Development of Business".

**RISK FACTORS**

Readers should carefully consider all such risks, which include but are not limited to the following:

**General Risks**

*Limited Operating History*

BTQ has a limited history of operations and is in the early stage of development. As such, BTQ will be subject to many risks common to early-stage enterprises, particularly those still focused on research and development, including undercapitalization, cash shortages, limitations with respect to personnel, financial and other resources, and lack of revenue. There is no assurance that BTQ will achieve its operating goals. There is no assurance that BTQ will be successful in achieving a return on shareholders' investment and the likelihood of success must be considered in light of its early stage of operations.

*Negative Operating Cash Flow*

The Company has not generated positive cash flow from operations. The Company is devoting significant resources to its research and development programs and to the advancement towards commercial operations; however, there can be no assurance that it will achieve commercial operations or generate positive cash flow from operations in the future. The Company expects to continue to incur negative consolidated operating cash flow and losses until such time as it achieves sustained and meaningful commercial operations. The extent of our future operating losses and the achievement and timing of profitability are uncertain, and we expect to continue incurring significant expenses and operating losses over the next several years. In the event that BTQ experiences additional operating losses or fails to achieve or if achieved, maintain, profitability in future periods, the value of the Common Shares may decline. In addition, if BTQ is unable to achieve or maintain positive cash flows, BTQ would be required to seek additional funding, which may not be available on favourable terms, if at all. This risk is a factor which indicates a material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern.

*Future Capital Requirements and Uncertainty of Additional Funding*

The Company may require funding through debt or equity offering for its ongoing and future activities. There can be no assurance that BTQ will be able to obtain adequate financing in the future or that the terms of such financing will be favourable. Failure to obtain additional financing could cause BTQ to reduce or terminate its operations.

If additional funds are raised through further issuances of equity or securities convertible into equity, existing shareholders could suffer significant dilution, and any new equity securities issued could have rights, preferences, and privileges superior to those of other BTQ securityholders. Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for BTQ to obtain additional capital and to pursue business opportunities.

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*Operational Reliance on Third-Party Providers*

The Company relies upon independent third-party services providers. The Company's operations could be interrupted or impaired if these third-party service providers experience operational or other systems difficulties or failures, terminate their services, or fail to comply with regulations. Replacing vendors or addressing other issues with the Company's third-party service providers could entail significant delay, expense, and disruption of service. As a result, if the third-party service providers experience difficulties, are subject to cybersecurity breaches, or terminate their services and the Company is unable to replace them with other service providers in a timely manner, the Company's operations could be interrupted. If an interruption were to continue for a significant period, the Company's business, financial condition, and results of operations could be adversely affected.

*Competition*

The Company competes and expects to compete with other post-quantum cryptography and technology businesses, including other businesses focused on applying post-quantum cryptography to blockchain. Because its industry is evolving and characterized by technological change, it is difficult for the Company to predict whether, when and by whom new competing technologies may be introduced or when new competitors may enter the market. The Company faces increased competition from companies with strong positions in certain markets the Company intends to serve and in new markets and regions it may enter. Many of the Company's competitors have significantly greater financial and other resources than the Company currently possesses and may spend significant amounts of resources to gain market share. The Company cannot assure investors that it will be able to compete effectively against current and future competitors. In addition, increased competition or other competitive pressures may result in price reductions, reduced margins or loss of market share, any of which could have a material adverse effect on the Company's business, financial condition or results of operations. Competitors may be able to respond to new or emerging technologies and changes in customer requirements more effectively than the Company can, or devote greater resources to the development, promotion and sale of products than the Company can. Current and potential competitors may establish cooperative relationships among themselves or with third parties, including through mergers or acquisitions, to increase the ability of their products to address the needs of the Company's prospective customers. If these competitors were to acquire significantly increased market share, it could have a material adverse effect on the Company's business, financial condition or results of operations. The Company's competitors may also establish or strengthen co-operative relationships with systems integrators, third-party consulting firms or other parties with whom the Company has relationships, thereby limiting its ability to promote its products.

If the Company is not able to differentiate its business from those of its competitors, drive value for customers or effectively align its financial and operations resources with its goals and objectives, it may not be able to compete effectively against its competitors. If the Company fails to compete effectively against its competitors, its business, results of operations, financial condition and prospects may be adversely affected.

*Compliance and Risk Management Programs* 

The Company's ability to comply with applicable laws and rules will be largely dependent on the establishment and maintenance of compliance, review, and reporting systems, as well as the ability to attract and retain qualified compliance and other risk-management personnel, as needed. The Company cannot provide any assurance that its compliance policies and procedures will be effective or that it will be successful in monitoring or evaluating its risks. If there is any alleged non-compliance with applicable laws or regulations, The Company could be subject to investigations and judicial or administrative proceedings that may result in substantial penalties or civil lawsuits for damages, restitution or other remedies, which could be significant. Any of these outcomes, individually or together, may materially and adversely affect BTQ's reputation, business, results of operations, financial condition, prospects and valuation, and the value of its Common Shares.

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*Stock Exchange Listing Compliance Risk*

The Company's Common Shares are listed on the Nasdaq and Cboe Canada. Continued listing on these stock exchanges is subject to compliance with their rules and continued listing requirements, including minimum bid price, minimum market value, and corporate governance standards. If the Company fails to meet these requirements, it may receive a deficiency notice and could face delisting proceedings. Delisting from the stock exchanges could adversely affect the liquidity and market price of the Common Shares, the Company's ability to raise capital, and the Company's reputation with investors and business partners.

Additionally, members of our management team and our board of directors have limited experience managing a publicly traded company and navigating the complex regulatory environment for public companies. We are subject to significant regulatory oversight and reporting obligations under the U.S. and Canadian securities laws and the continuous scrutiny of securities analysts and investors. These obligations and constituents require significant attention from our management and board of directors, and failure to effectively comply with the regulations applicable to public companies may materially and adversely affect BTQ's reputation, business, results of operations, financial condition, prospects and valuation, and the value of its Common Shares.

*As a Foreign Private Issuer, the Company is Subject to Different U.S. Securities Laws and Rules than a U.S. Domestic Issuer*

The Company is a "foreign private issuer", under applicable U.S. federal securities laws, and is, therefore, not subject to the same requirements that are imposed upon U.S. domestic issuers by the United States Securities and Exchange Commission (the "SEC"). Under the United States Exchange Act of 1934, as amended (the "U.S. Exchange Act"), the Company is subject to reporting obligations that, in certain respects, are less detailed and less frequent than those of U.S. domestic reporting companies. As a result, the Company does not file the same reports that a U.S. domestic issuer would file with the SEC, although the Company is required to file with or furnish to the SEC the continuous disclosure documents that it is required to file in Canada under Canadian securities laws.

In addition, the Company's officers, directors, and principal shareholders are currently exempt from the reporting and short- swing profit recovery provisions of Section 16 of the U.S. Exchange Act. Therefore, the Company's shareholders may not know on as timely a basis when the Company's officers, directors and principal shareholders purchase or sell Common Shares, as the reporting periods under the corresponding Canadian insider reporting requirements are longer.

As a foreign private issuer, the Company is exempt from the rules and regulations under the U.S. Exchange Act related to the furnishing and content of proxy statements. The Company is also exempt from Regulation FD, which prohibits issuers from making selective disclosures of material non-public information. While the Company complies with the corresponding requirements relating to proxy statements and disclosure of material non-public information under Canadian securities laws, these requirements differ from those under the U.S. Exchange Act and Regulation FD and shareholders should not expect to receive the same information at the same time as such information is provided by U.S. domestic companies. In addition, the Company may not be required under the U.S. Exchange Act to file annual and quarterly reports with the SEC as promptly as U.S. domestic companies whose securities are registered under the U.S. Exchange Act. In addition, as a foreign private issuer, the Company has the option to follow certain Canadian corporate governance practices, except to the extent that such laws would be contrary to U.S. securities laws, and provided that the Company disclose the requirements it is not following and describe the Canadian practices it follows instead. The Company has elected and may in the future elect to follow home country practices in Canada with regard to certain corporate governance matters. As a result, the Company's shareholders may not have the same protections afforded to shareholders of U.S. domestic companies that are subject to all corporate governance requirements.

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*The Company may lose its Foreign Private Issuer Status in the Future*

The Company may in the future lose its foreign private issuer status if a majority of its Common Shares are held in the U.S. and if the Company fails to meet the additional requirements necessary to avoid loss of its foreign private issuer status. The regulatory and compliance costs under U.S. federal securities laws as a U.S. domestic issuer may be significantly more than the costs incurred as a Canadian foreign private issuer eligible to use the Multi-Jurisdictional Disclosure System ("MJDS"). If the Company is not a foreign private issuer, it would not be eligible to use the MJDS or other foreign issuer forms and would be required to file periodic and current reports and registration statements on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer, and would be required to file financial statements prepared in accordance with United States generally accepted accounting principles. In addition, the Company may lose the ability to rely upon exemptions from Nasdaq corporate governance requirements that are available to foreign private issuers.

*The Company Relies Upon Certain Accommodations Available to It as an "Emerging Growth Company"*

The Company is an "emerging growth company" as defined in section 3(a) of the U.S. Exchange Act (as amended by the JOBS Act, enacted on April 5, 2012), and the Company will continue to qualify as an emerging growth company until the earliest to occur of: (a) the last day of the fiscal year during which the Company has total annual gross revenues of US$1,235,000,000 (as such amount is indexed for inflation every five years by the SEC) or more; (b) the last day of the fiscal year of the Company following the fifth anniversary of the date of the first sale of common equity securities of the Company pursuant to an effective registration statement under the United States Securities Act of 1933, as amended; (c) the date on which the Company has, during the previous three year period, issued more than US$1,000,000,000 in non-convertible debt; and (d) the date on which the Company is deemed to be a "large accelerated filer", as defined in Rule 12b-2 under the U.S. Exchange Act. The Company will qualify as a large accelerated filer (and would cease to be an emerging growth company) at such time when on the last business day of its second fiscal quarter of such year the aggregate worldwide market value of its common equity held by non-affiliates will be US$700,000,000 or more. For so long as the Company remains an emerging growth company, it is permitted to and intends to rely upon exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. The Company cannot predict whether investors will find the Common Shares less attractive because the Company relies upon certain of these exemptions. If some investors find the Common Shares less attractive as a result, there may be a less active trading market for the common shares and the Common Share price may be more volatile. On the other hand, if the Company no longer qualifies as an emerging growth company, the Company would be required to divert additional management time and attention from the Company's development and other business activities and incur increased legal and financial costs to comply with the additional associated reporting requirements, which could negatively impact the Company's business, financial condition and results of operations.

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*Unexpected Market Disruptions*

The Company may incur major losses in the event of disrupted markets and other extraordinary events in which market behaviour diverges significantly from historically recognized patterns. The risk of loss in such events may be compounded by the fact that, in disrupted markets, many positions may become illiquid, making it difficult or impossible to close out positions against which markets are moving. Market disruptions caused by unexpected political, military and terrorist events, or other factors, may from time to time cause dramatic losses for BTQ.

*Dependence on Key Personnel and Ability to Recruit and Retain Qualified Directors and Officers*

BTQ's success, future growth and its ability to develop depend, to a significant extent, on its ability to attract and retain highly qualified personnel and directors. The Company relies on its officers and a limited number of key employees and consultants and there is no assurance that BTQ will be able to retain such key employees, consultants and management. The loss of qualified directors, officers or key employees and consultants, if not replaced in a timely manner, could have a material adverse effect on BTQ's business, results of operations, financial condition and prospects.

*Significant Shareholder*

As of the date of this AIF, Olivier Roussy Newton beneficially owns and controls 30.44% of the Common Shares. Olivier Roussy Newton is the Company's Chief Executive Officer and a director of the Company. As a result of such ownership, Olivier Roussy Newton will be able to exert significant influence over matters that are to be determined by holders of Common Shares, including matters relating to mergers, consolidations and sale of all or substantially all of the Company's assets, the election of directors, and other significant corporate actions. The interests of Olivier Roussy Newton may not always be aligned with the interests of the Company or the interests of other shareholders. Further, if Olivier Roussy Newton were to sell or transfer substantial amounts of Common Shares, the market price of the Common Shares in the public markets could fall. The perception among the public that these sales or transfers could occur may also produce such effect. Further, the timing and receipt of any takeover or control premium by holders of Common Shares could depend on the determination of Olivier Roussy Newton as to when to sell or transfer Common Shares. This concentration of ownership may discourage, delay or prevent a change in control of the Company, which could deprive shareholders of opportunities to receive a premium for their Common Shares as part of a sale of the Company or its assets and provide liquidity to other shareholders, and might reduce the price of the Common Shares.

*Market Risk and Market Price Volatility for Securities*

There can be no assurance that an active trading market for BTQ's shares will be sustained. The market price for the Common Shares has been and may continue to be volatile and subject to wide fluctuations in response to numerous factors, many of which are beyond the Company's control. Factors such as government regulation, price fluctuations, share price movements of peer companies and competitors, as well as overall market movements, may have a significant impact on the market price of BTQ's securities. The stock market has from time to time experienced extreme price and volume fluctuations, which have often been unrelated to the operating performance of particular companies. As well, certain institutional investors may base their investment decisions on consideration of the Company's performance against such institutions' respective guidelines and criteria, and failure to meet such criteria may result in a limited or no investment in the Common Shares by those institutions, which could adversely affect the trading price of the Common Shares. The trading market for the Common Shares depends in part on the research and reports that securities or industry analysts publish about the Company. Inaccurate or unfavorable publication of research reports about the Company's business, or the downgrade of the Common Shares by such securities or industry analysts, is likely to cause the price of the Common Shares to decline. If one or more of these analysts cease coverage of the Company or fail to publish reports on the Company regularly, demand for the Common Shares could decrease, which might cause the price of the Common Shares and trading volume to decline. There can be no assurance that fluctuations in price and volume will not occur. In addition, shareholders may realize less than the original amount invested on dispositions of their Common Shares during periods of such market price decline.

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*Common Shares May Have Limited Liquidity*

Shareholders may be unable to sell significant quantities of Common Shares into the public trading markets without a significant reduction in the price of their Common Shares, or at all. There can be no assurance that there will be sufficient liquidity of the Common Shares on the trading market, and that the Company will continue to meet the listing requirements of the Cboe Canada, maintain a listing on Nasdaq, or achieve or maintain a listing on any other securities exchange.*Foreign Exchange Risk*

The Company is a Canadian company, and most of its expenses and fundraising has been done in Canadian dollars. However, its operations are predominantly denominated in U.S. dollars, and as a result, the Company is subject to foreign exchange risks relating to the relative value of the U.S. dollar as compared to the Canadian dollar. A decline in the U.S. dollar could result in a decrease in the real value of the Company's revenues and adversely impact financial performance.

*Tax*

No assurance can be given that new taxation rules will not be enacted or existing rules will not be applied in a manner which could result in BTQ being subject to additional taxation or which could otherwise have a material adverse effect on BTQ's results from operations and financial condition.

*Litigation*

BTQ may be subject to litigation arising out of, or related to, its operations. Damages claimed under such litigation may be material, and the outcome of such litigation may materially impact BTQ's operations and the value of its Common Shares. While BTQ expects to assess the merits of any lawsuits and defend such lawsuits accordingly, it may be required to incur significant expense or devote significant financial resources to such defenses. In addition, the adverse publicity surrounding such claims may have a material adverse effect on BTQ's operations and its Common Shares.

*Investment Risk*

There is no assurance that BTQ will achieve its investment objectives. An investment may not earn any positive return and may result in the loss of some or all of the capital invested.

*Management of Growth*

The Company has recently experienced, and may continue to experience, growth in the scope of its operations. This growth has resulted in increased responsibilities for BTQ's existing personnel, the hiring of additional personnel and, in general, higher levels of operating expenses. In order to manage its current operations and any future growth effectively, BTQ will need to continue to implement and improve its operational, financial and management information systems, as well as hire, manage and retain its employees and maintain its corporate culture including technical standards. There can be no assurance that BTQ will be able to manage such growth effectively or that its management, personnel or systems will be adequate to support BTQ's operations.

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*Estimates of Market Opportunities* 

Estimates of the global post-quantum market may prove to be inaccurate and may not be indicative of our future growth or performance. Market estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. While our estimates of the market are made in good faith and are based on assumptions and estimates we believe to be reasonable under the circumstances, these estimates may not prove to be accurate. Further, even if the estimates of our market opportunity prove to be accurate, we could fail to capture significant portions, or any portion, of the available markets.

*Acquisition Completion and Integration Risk*

The Company has completed or announced several strategic acquisitions and investments, including the anticipated acquisition of QPerfect and its joint development agreement with ICTK. The French foreign direct investment ("**FDI**") approval process for the QPerfect acquisition remains pending and there is no assurance that such approval will be obtained on acceptable terms or at all. The Company may not be able to consummate the QPerfect acquisitions, or other acquisitions, on commercially acceptable terms or at all, or may not realize the anticipated benefits of any acquisitions the Company undertakes, including its acquisition of QPerfect. The integration of acquired businesses, technologies, and personnel involves significant risks, including the potential for unanticipated liabilities, difficulties in retaining key personnel, challenges in integrating different corporate cultures and operational practices, and the diversion of management's attention from existing operations. Failure to successfully complete and, if completed, integrate acquisitions could have a material adverse effect on the Company's business, financial condition, and results of operations.

*Export Controls and National Security Risks*

The Company operates in the post-quantum cryptography and quantum computing sectors, which are subject to export controls, sanctions, and national security regulations in multiple jurisdictions, including Canada, the United States, the European Union, and the Republic of Korea. The Company's products may be classified as controlled technology under applicable export control regimes, and the Company may be required to obtain export licenses or other approvals before transferring technology, software, or hardware across borders. Changes in export control regulations, the imposition of new restrictions, or the failure to obtain required approvals could limit the Company's ability to conduct business internationally, restrict its ability to collaborate with partners, and adversely affect its business and growth strategy.

*Anti-Bribery Risks*

The Company is subject to various anti-bribery laws, such as the U.S. Foreign Corrupt Practices Act, Canada's Corruption of Foreign Public Officials Act and other applicable local laws of Canada and the United States. The Company's reputation may be adversely affected if the Company were reported to be associated with corrupt practices or if the Company or its employees or partners fail to comply with such laws. Such damage to the Company's reputation could adversely affect our ability to grow our business. Additionally, violations of such laws could subject us to significant fines and penalties.

*Reputational Risks*

The Company may be subject to reputational harm arising from public statements, allegations, or dissemination of information by former directors, officers, or other insiders. A former director and officer of the Company has publicly disseminated, and may continue to disseminate, negative statements, allegations, and other information regarding the Company, its management, and its board of directors. Such public statements, whether or not accurate, could materially harm the Company's reputation with investors, business partners, regulators, and other stakeholders. It could also result in decreased investor confidence, increased stock price volatility, increased regulatory scrutiny or inquiries, damage to existing and prospective business relationships, difficulty attracting and retaining qualified directors, officers, and employees, and increased costs associated with responding to or addressing such statements, including potential litigation expenses.

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The viral nature of social media may amplify the reach and impact of such statements and any similar statements beyond their original audience, and the Company may have limited ability to control, counteract, or mitigate the dissemination of information once it has been published.

If the Company pursues remedies to address such statements, including litigation, such efforts may be costly, time-consuming, and may not result in a favourable outcome. Additionally, such efforts may themselves generate further negative publicity. There can be no assurance that the Company's reputation, business, results of operations, financial condition, prospects, and stock price will not be materially adversely affected by these or similar statements in the future.

*Different U.S. Securities Laws and Rules*

The Company is a foreign private issuer under applicable U.S. federal securities laws and, therefore, the Company is not required to comply with all the periodic disclosure and current reporting requirements of the Exchange Act, and related rules and regulations, applicable to U.S. domestic issuers. The Company does not file all of the same reports that a U.S. domestic issuer would file with the SEC, although the Company is required to file with or furnish to the SEC the continuous disclosure documents that the Company is required to file in Canada under Canadian securities laws. In addition, the Company's officers, directors and principal shareholders are exempt from the reporting and "short swing" profit recovery provisions of Section 16 of the Exchange Act. Therefore, shareholders may not know on as timely a basis when the Company's officers, directors and principal shareholders purchase or sell Common Shares, as the reporting periods under the corresponding Canadian insider reporting requirements are longer. In addition, as a foreign private issuer, the Company is exempt from the proxy rules under the Exchange Act.

*Loss of Foreign Private Issuer Status in the Future*

The Company may in the future lose its foreign private issuer status if a majority of the Common Shares are owned of record in the United States and the Company fails to meet the additional requirements necessary to avoid loss of foreign private issuer status. The regulatory and compliance costs to the Company under U.S. federal securities laws as a U.S. domestic issuer may be significantly more than the costs the Company incurs as a Canadian foreign private issuer eligible to use the multi-jurisdictional disclosure system. If the Company is not a foreign private issuer, it would not be eligible to use the multi-jurisdictional disclosure system or other foreign issuer forms and would be required to file periodic and current reports and registration statements on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer.

*We incur increased expenses as a result of being a public company and our current resources may not be sufficient to fulfill our public company obligations.*

We are incurring significant legal, accounting, insurance and other expenses as a result of being a public company, which makes operating our business costly and could cause our business, results of operations, and financial condition to suffer. Compliance with applicable securities laws in the United States and Canada and the rules of Nasdaq and Cboe Canada substantially increases our expenses, including our legal and accounting costs, and makes some activities more time-consuming and costly. Reporting obligations as a public company and our potential growth may strain our financial and management systems, processes and controls, as well as our personnel.

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These laws, rules and regulations make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as officers. As a result of the foregoing, we face and continue to face increased legal, accounting, insurance and certain other expenses, which negatively impact our financial performance and could cause our business, results of operations, and financial condition to suffer.

*The Company is subject to risks associated with its internal control over financial reporting.*

The Company is subject to reporting and other obligations under applicable U.S. and Canadian securities laws and the rules of the Nasdaq and Cboe Canada. The Company has significant requirements for enhanced financial reporting and internal control. The process of designing and implementing effective internal control is a continuous effort that requires the Company to anticipate and react to changes in its business and the economic and regulatory environments and to expend significant resources to maintain a system of internal control that is adequate to satisfy its reporting obligations as a public company. Any failure to implement or maintain internal control could cause the Company to fail to meet its reporting obligations on a timely basis, result in material misstatements in its consolidated financial statements and harm its business and results of operations. If the Company is unable to implement any required changes to its internal control over financial reporting effectively or efficiently, it could adversely affect the Company's operations, financial reporting and results of operations. In addition, if the Company fails to maintain an effective system of disclosure controls and internal control over financial reporting, its ability to produce timely and accurate financial statements or comply with applicable regulations could be adversely affected.

The Company will be required to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting pursuant to Section 404(a) of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") in the second annual report following the completion of its listing on Nasdaq. This assessment will need to include disclosure of any material weaknesses identified by the Company's management in its internal control over financial reporting. The rules governing the standards that must be met for management to assess the Company's internal control over financial reporting are complex and require significant documentation, testing and possible remediation. Testing and maintaining internal control may divert management's attention from other matters that are important to the Company's business.

In connection with the implementation of the necessary procedures and practices related to internal control over financial reporting, the Company may identify deficiencies related to internal control over financial reporting that it may not be able to remediate in time to meet the deadline imposed by U.S. and/or Canadian securities laws, including pursuant to Section 404 of the Sarbanes-Oxley Act. The Company's testing may reveal deficiencies in its internal control over financial reporting that are deemed to be material weaknesses which could result in a material misstatement of its annual consolidated financial statements or its interim reports, or disclosures that may not be prevented or detected.

The Company does not expect that its disclosure controls and procedures and internal control over financial reporting will prevent all error and fraud. The inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by individual acts of certain persons, by collusion of two or more people or by management override of the controls. Due to the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected in a timely manner or at all. The Company may not be able to conclude on an ongoing basis that it has effective internal control over financial reporting in accordance with U.S. and/or Canadian securities laws, including, the Sarbanes-Oxley Act, for compliance with the requirements of Section 404 of the Sarbanes-Oxley Act, or its independent registered public accounting firm may not issue an unqualified opinion, as and when applicable. If the Company is unable to conclude that it has effective internal control over financial reporting. investors could lose confidence in the Company's reported financial information, which could adversely affect the trading price of the Company's Common Shares and make the Company subject to investigations by the stock exchanges on which its securities are listed, the SEC, or other regulatory authorities, which could require additional financial and management resources. Failure to accurately report the Company's financial performance on a timely basis could also jeopardize the Company's listing on Nasdaq and Cboe Canada or any other stock exchange on which its Common Shares may be listed. Delisting of the Common Shares on any exchange would reduce the liquidity of the market for the Company's Common Shares, which would reduce the price of and increase the volatility of the market price of its Common Shares.

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The Company has identified material weaknesses in its internal control over financial reporting in the past and may identify additional material weaknesses in the future or fail to maintain effective internal control over financial reporting, which may result in material misstatements of its consolidated financial statements or cause the Company to fail to meet its periodic reporting obligations, which could have a material adverse effect on the Company, its business, results of operations and financial condition.

**Business and Industry Risks**

*Regulatory Risks.*

Due to their global nature, blockchain-related technologies and encryption-related technologies are subject to regulatory fragmentation due to different treatment depending on jurisdiction. Certain governments have categorized certain blockchain technologies as illegal, while others have embraced their utility and have approved them for trade. Ongoing and/or future regulatory actions may have a substantial impact on BTQ's business operations.

The activities of the Company may be subject to regulation by governmental authorities. Achievement of the Company's business objectives are contingent, in part, upon compliance with regulatory requirements enacted by these governmental authorities and obtaining all regulatory approvals, where necessary, for the sale of its products. The Company cannot predict the time required to secure all appropriate regulatory approvals for its products, or the extent of testing and documentation that may be required by governmental authorities. Any delays in obtaining, or failure to obtain regulatory approvals would significantly delay the development of markets and products and could have a material adverse effect on the business, results of operations and financial condition of the Company. The effect of future regulatory change could materially and adversely affect the Company.

*Reliance on Internally & Externally Built Software, Data and Intellectual Property*

BTQ's business is dependent on internally and externally developed software, data, and intellectual property. Its operations may be severely and adversely affected by the malfunction of such technology.

Failure to protect the Company's intellectual property could harm its ability to compete effectively. The Company is highly dependent on its ability to protect its proprietary technology. The Company relies and intends to rely on a combination of copyright, trademark and trade secret laws, as well as non-disclosure agreements and other contractual provisions to establish and maintain its proprietary rights. The Company intends to protect its rights vigorously. However, there can be no assurance that these measures will, in all cases, be successful. Enforcement of the Company's intellectual property rights may be difficult, particularly in some nations outside of North America in which the Company may seek to market its products. While U.S. and Canadian copyright laws, international conventions and international treaties may provide meaningful protection against unauthorized duplication of software, the laws of some foreign jurisdictions may not protect proprietary rights to the same extent as the laws of Canada or of the United States. The absence of internationally harmonized intellectual property laws makes it more difficult to ensure consistent protection of the Company's proprietary rights. Software piracy has been, and is expected to be, a persistent problem for the software industry, and piracy of the Company's products represents a loss of revenue to the Company. Despite the precautions the Company may take, unauthorized third parties, including its competitors, may be able to: (i) copy certain portions of its products; or (ii) reverse engineer or obtain and use information that the Company regards as proprietary. Also, the Company's competitors could independently develop technologies that are perceived to be substantially equivalent or superior to the Company's technologies. The Company's competitive position as well as its business, results of operations, financial condition and prospects may be materially adversely affected by its possible inability to effectively protect its intellectual property.

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*Banks Accounts and Services*

A number of companies that provide blockchain-related services have been unable to find banks that are willing to provide them with bank accounts and banking services. Similarly, a number of such companies have had their existing bank accounts closed by their banks. Banks may refuse to provide bank accounts and other banking services to blockchain-related companies, or companies that accept digital assets, for a number of reasons, such as perceived compliance risks or costs.

*Insurance*

BTQ insures its operations in accordance with technology industry practice. However, given the novelty of digital assets and associated businesses, such insurance may not be available, may be uneconomical for BTQ, or the nature or level may be insufficient to provide adequate insurance cover. The occurrence of an event that is not covered or fully covered by insurance could have a material adverse effect on BTQ.

*Cybersecurity Risks*

Cyber incidents can result from deliberate attacks or unintentional events, and may arise from internal sources (e.g., employees, contractors, service providers, suppliers and operational risks) or external sources (e.g., nation states, terrorists, hacktivists, competitors and acts of nature). Cyber incidents include unauthorized access to information systems and data (e.g., through hacking or malicious software) for purposes of misappropriating or corrupting data or causing operational disruption. Cyber incidents also may be caused in a manner that does not require unauthorized access, such as causing denial-of-service attacks on websites (e.g., efforts to make network services unavailable to intended users). A cyber incident that affects BTQ might cause disruptions and adversely affect its business operations, and might also result in violations of applicable law (e.g., personal information protection laws), each of which might result in potentially significant financial losses and liabilities, regulatory fines and penalties, reputational harm, and reimbursement and other compensation costs. In addition, substantial costs might be incurred to investigate, remediate and prevent cyber incidents.

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*Digital Asset and Cryptocurrency Regulatory Risk*

The Company's Bitcoin Quantum product involves the creation and operation of a cryptocurrency network, including a mining pool and the accumulation of digital asset tokens on the Company's balance sheet. The regulatory treatment of digital assets and cryptocurrencies varies significantly across jurisdictions and is subject to rapid change. The Company may be subject to securities laws, money transmission laws, tax regulations, and other regulatory requirements applicable to digital asset activities. Changes in the regulatory environment, including potential classification of BTQ tokens as securities, restrictions on mining activities, or limitations on the holding or transfer of digital assets, could have a material adverse effect on the Company's Bitcoin Quantum business and the value of digital assets held on its balance sheet.

*Early Stage of Quantum Computing Industry*

The market for quantum computers is still in its early stages and while it is rapidly growing, if the market for quantum computers in general does not develop as expected, or develops more slowly than expected, our business, results of operations, financial condition, and prospects could be harmed.

*Use of Generative AI Tools*

We use, and expect to continue using, generative AI tools primarily to support internal productivity and development activities.

While generative AI technologies are evolving rapidly, they may also generate output that are incomplete, misleading, or incorrect, which could introduce downstream security or operational risks. Our use of third-party generative AI tools may also present security, privacy, and operational risks, including limited visibility into training data sources, model behavior, vendor controls, and the potential introduction of defects or security vulnerabilities through AI-generated outputs.

We use generative AI tools in limited and controlled contexts and prohibit the use of AI technologies in areas that we deem to create high risks that cannot be mitigated related to cybersecurity, confidentiality, privacy, intellectual property, legal compliance, and/or ethical standards. In addition, we employ practices designed to evaluate, track, and mitigate the risks associated with the use of generative AI. However, such controls, prohibitions and measures cannot provide absolute security and may not prevent or mitigate all of the evolving risks presented by the use of generative AI that could adversely affect our business, results of operations, financial condition, prospects or reputation.

*Key Partnership Concentration Risk* 

The Company's QCIM hardware program is substantially dependent on its joint development agreement with ICTK. ICTK is the Company's sole partner for QCIM chip development, manufacturing, and certification. If ICTK were to experience financial difficulties, fail to perform its obligations under the joint development agreement, or if the relationship were to terminate for any reason, the Company's ability to commercialize QCIM could be materially delayed or prevented. Similarly, the Company's quantum computing capabilities are dependent on the QPerfect acquisition, which remains subject to certain conditions, including French FDI approval. The Company's QCIM silicon validation program is dependent on ITRI. Concentration of the Company's technology development in a limited number of partners exposes the Company to significant operational and execution risk. The termination of any of these partnerships and the underlying agreements governing the relationship could have a material adverse effect on the Company's business, results of operations, financial condition and prospects.

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*Pre-Revenue Product Commercialization Risk*

All of the Company's principal products, including QCIM, Bitcoin Quantum, and QSSN, are in pre-revenue stages of development. The Company has not generated material revenue from any of its products and there is no assurance that any of the Company's products will achieve commercial viability, generate revenue, or achieve market acceptance. The transition from research and development to commercial revenue involves significant risks, including technical risks related to product performance and reliability, market risks related to customer adoption and competitive dynamics, and operational risks related to scaling production and support capabilities. The Company's financial projections, including anticipated Bitcoin Quantum mining pool revenue and QSSN validation fees, are based on assumptions that may not be realized. If the Company fails to commercialize its principal products, its business may suffer and you may not be able to sell the Common Shares which you purchased at or above the price you paid for them and you may lose your investment.

*Enforcement of Judgments Against Foreign Persons*

Investors should be aware that most of BTQ's operations are currently located outside of Canada and some of the directors and officers of BTQ are and will likely continue to be located outside of Canada and, as a result, it may be difficult to enforce a Canadian court judgment based upon the civil liability provisions of Canadian securities laws against BTQ or any of these persons in a Canadian court, or to affect service of process upon these persons in Canada. All or a substantial portion of the assets of these persons are likely to be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against such persons in Canada or to enforce a judgment obtained in Canadian courts against such persons outside of Canada. Also, if Canadian law is found to be applicable to a claim which a court outside of Canada can and is prepared to hear, the content of applicable Canadian law must be proved as a fact by expert witnesses, which can be a time-consuming and costly process. If proceedings were to be brought outside of Canada, all procedural matters may be required to be governed by such jurisdiction's law. Additionally, it may be difficult for an investor, or any other person or entity, to assert Canadian securities law claims in original actions instituted outside of Canada.

Similarly, the majority of BTQ's directors and officers are located outside the United States and all or a portion of the assets of such persons are and will likely continue to be located outside the United States. Consequently, it may be difficult for U.S. investors to effect service of process within the United States upon BTQ or its directors who are not residents of the United States, or to realize in the United States upon judgements of courts of the United States predicated upon civil liabilities under the Securities Act. Investors should not assume that Canadian courts: (1) would enforce judgements of U.S. courts obtained in actions against BTQ or such persons predicated upon the civil liability provisions of the U.S. federal securities laws or the securities or blue sky laws of any state within the United States or (2) would enforce, in original actions, liabilities against BTQ or such persons predicated upon the U.S. federal securities laws or any such state securities or blue sky laws.

**DIVIDENDS**

The Company has not declared or paid any cash dividends on its securities since the completion of the Transaction. The Company currently intends to retain any future earnings to fund the development and growth of its business and/or to pay down debt and does not currently anticipate paying dividends on the subordinate voting shares. Any determination to pay dividends in the future will be at the discretion of the Board and will depend on many factors, including, among others, the Company's financial condition, current and anticipated cash requirements, contractual restrictions and financing agreement covenants, solvency tests imposed by applicable corporate law and other factors that the Board may deem relevant.

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**DESCRIPTION OF CAPITAL STRUCTURE**

**Common Shares** 

The Company is authorized to issue an unlimited number of Common Shares, of which there were 141,310,930 issued and outstanding as of the date of this AIF. Each Common Share entitles the holder thereof to one vote per Common Share at meetings of the shareholders of the Company, to receive dividends if, as and when declared by the board of directors of the Company and to receive *pro rata* the remaining property and assets of the Company upon its dissolution or winding-up. Shareholders have no pre-emptive rights, subscription or conversion rights.

All Common Shares are of the same class with equal rights and privileges. Common Shares are not subject to future calls or assessments. The Company may issue additional Common Shares and options therefore from time to time on terms and conditions acceptable to the directors.

**Warrants**

As of the date of this AIF the Company has 306,673 Warrants outstanding.

**Options** 

The Company has a "rolling" long-term omnibus equity incentive plan ("**Omnibus Plan**"), which was approved by shareholders at the Company's 2023 annual general meeting held on August 30, 2023. The Omnibus Plan provides flexibility to the Company to grant equity-based incentive awards in the form of the Company's options ("**Options**"), restricted share units ("**RSUs**"), performance shared units ("**PSUs**") and deferred share units.

The Omnibus Plan provides that the aggregate maximum number of the outstanding common shares of the Company that may be issued upon the exercise or settlement of awards granted under the Omnibus Plan shall not exceed 10% of the issued and outstanding common shares from time to time. The aggregate number of common shares (a) issuable to insiders at any time (under all of the Company's security-based compensation arrangements) cannot exceed 10% of the issued and outstanding common shares and (b) issued to insiders within any one-year period (under all of the Company's security-based compensation arrangements) cannot exceed 10% of the issued and outstanding common shares. All directors, employees and consultants are eligible to participate in the Omnibus Plan. The extent to which any such individual is entitled to receive a grant of an award pursuant to the Omnibus Plan will be determined in the sole and absolute discretion of the Plan Administrator. Additional information can be found in the Company's Omnibus Plan, which is available on SEDAR+.

As of the date of this AIF, the Company has 2,876,250 Options outstanding under the Omnibus Plan.

An Option entitles a holder thereof to purchase a prescribed number of common shares at an exercise price set at the time of the grant. The Plan Administrator will have the authority to determine the vesting terms applicable to grants of Options. Once an Option becomes vested, it shall remain vested and shall be exercisable until expiration or termination of the Option, unless otherwise specified by the Plan Administrator, or as otherwise set forth in any written employment agreement, award agreement or other written agreement between the Company or a subsidiary of the Company and the participant.

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The options are more fully described in the Company's Omnibus Plan, which is available on SEDAR+.

**Restricted Share Units**

As of the date of this AIF, the Company has 4,434,300 restricted share units outstanding under the Omnibus Plan. An RSU is a unit equivalent in value to a common share credited by means of a bookkeeping entry in the books of the which entitles the holder to receive one common share (or the value thereof) for each RSU after a specified vesting period. Upon settlement, holders will redeem each vested RSU for the following at the election of such holder but subject to the approval of the Plan Administrator: (a) one fully paid and non-assessable common share in respect of each vested RSU, (b) a cash payment or (c) a combination of common shares and cash. The RSUs are more fully described in the Company's Omnibus Plan, which is available on SEDAR+.

**Performance Share Units**

As of the date of this AIF, the Company has 1,525,000 performance share units outstanding under the Omnibus Plan. A PSU is a unit equivalent in value to a common share credited by means of a bookkeeping entry in the books of the which entitles the holder to receive one common share (or the value thereof) for each PSU upon the achievement of certain performance goals during a performance period, subject to certain performance multipliers. Upon settlement, holders will redeem each vested PSU for the following at the election of such holder but subject to the approval of the Plan Administrator: (a) one fully paid and non-assessable common share in respect of each vested PSU, (b) a cash payment or (c) a combination of common shares and cash, and in each case subject to any performance multipliers. The PSUs are more fully described in the Company's Omnibus Plan, which is available on SEDAR+.

**MARKET FOR SECURITIES** 

<u>**Trading Price and Volume**</u>

The Common Shares are listed and posted for trading on (i) Nasdaq under the symbol "BTQ" (since September 26, 2025); (ii) Cboe under the symbol "BTQ". Upon commencement of trading on Nasdaq, the Common Shares ceased to be quoted on the OTCQX.

The following table sets forth the reported closing high and low prices and the aggregate volume of trading of the Common Shares on Cboe and Nasdaq during the financial year ended December 31, 2025:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Cboe Canada** | **Cboe Canada** | **Cboe Canada** | **Nasdaq** | **Nasdaq** | **Nasdaq** |
| | **High** | **Low** | **Volume** | **High** | **Low** | **Volume** |
| |  |  |  | **(US$)** | **(US$)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;December 2025 | 9.96 | 6.80 | 3346378 | 7.22 | 4.95 | 69319200 |
| &nbsp;&nbsp;&nbsp;&nbsp;November 2025 | 11.20 | 7.58 | 6043056 | 7.95 | 5.42 | 73490000 |
| &nbsp;&nbsp;&nbsp;&nbsp;October 2025 | 21.09 | 8.64 | 9086752 | 16.00 | 6.13 | 235841500 |
| &nbsp;&nbsp;&nbsp;&nbsp;September 2025 | 10.10 | 3.95 | 8955833 | 7.29 | 4.94 | 20439500 |
| &nbsp;&nbsp;&nbsp;&nbsp;August 2025 | 7.28 | 3.55 | 7056025 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;July 2025 | 11.49 | 5.20 | 13765302 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;June 2025 | 8.00 | 3.25 | 10283833 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;May 2025 | 5.11 | 2.13 | 5892147 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;April 2025 | 2.60 | 1.35 | 3487205 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;March 2025 | 3.14 | 2.01 | 3148926 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;February 2025 | 4.94 | 2.70 | 5437560 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;January 2025 | 6.61 | 2.55 | 17030337 |  |  |  |

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<u>**Prior Sales**</u>

The following table sets for the details regarding all issuances of the Company's securities that are outstanding but not listed or quoted on a marketplace, including issuances of all securities convertible or exchangeable into shares of the Company, during the most recently completed financial year:

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| | | | |
|:---|:---|:---|:---|
| **Date Issued** | **Number of Securities <br>Issued** | **Issue/Exercise/Conversion <br>Price per Security** | **Type** |
| 01-Feb-25 | 50000 | $4.48 | Option Grant |
| 06-Feb-25 | 100000 | N/A | RSU Grant |
| 01-Mar-25 | 200000 | N/A | RSU Grant |
| 22-July-25 | 100000 | $6.34 | Option Grant |
| 22-July-25 | 62300 | N/A | RSU Grant |
| 02-Sep-25 | 600000 | N/A | RSU Grant |
| 12-Sept-25 | 1000000 | N/A | RSU Grant |
| 01-Nov-2025 | 140000 | N/A | RSU Grant |
| 07-Nov-2025 | 200000 | N/A | RSU Grant |
| 07-Nov-2025 | 400000 | N/A | PSU Grant |
| 07-Nov-2025 | 400000 | N/A | PSU Grant |
| 16-Dec-2025 | 72500 | N/A | RSU Grant |
| 16-Dec-2025 | 180000 | N/A | RSU Grant |
| 23-Dec-2025 | 300000 | N/A | RSU Grant |

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**DIRECTORS AND OFFICERS**

<u>**Name, Occupation and Security Holdings**</u>

The following table sets out, as of the date of this AIF, the names of the directors and officers of the Company, the province or state and country of residence of each such director and officer, their respective positions and offices held with the Company and their principal occupations during the last five years. The term of office of each of the directors expires at the next annual general meeting of shareholders or until their successor is elected or appointed.

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**Name, Province and<br>Country of Residence<br>and Position Held** | &nbsp;&nbsp;**Date Elected or<br>Appointed** | &nbsp;&nbsp;**Principal Occupations During Last Five Years** |
| **Olivier Roussy Newton**<br>*Zug, Switzerland*<br>Chief Executive Officer and Director | February 17, 2023 | CEO of BTQ; Co-Founder and former CEO of DEFI Technologies; President of EV Technology Group; Founder and partner of Latent Capital; |
| **Lonny Wong**<br>*Vancouver, British Columbia*<br>Chief Financial Officer | May 18, 2023 | Partner at Saturna Group Chartered Professional Accountants LLP |
| **Christopher Tam** <br>*Vancouver, British Columbia* <br>President, Head of Innovation, and Director | August 26, 2025 | President and Head of Innovation of BTQ. Co-Founder & CEO of Zero Computing, Head of Innovation at BTQ, formerly Head of Partnerships at BTQ, formerly Product Manager at BTQ, formerly Data Engineer (Internship) at EQ Works, formerly Research and Teaching Assistant at Western University, formerly Machine Learning Researcher at AvocadoCore |
| **Dr. Gavin Brennen**<br>*Sydney, Australia*<br>Chief Quantum Officer | March 1, 2025 | Chief Quantum Officer of BTQ; professor of physics in the School of Mathematical and Physical Sciences at Macquarie University |
| **Jeff Choi**<br>*Seoul, Korea*<br>Chief Strategy Officer | May 31, 2025 | Chief Strategy Officer of BTQ; formerly Chief of Staff at Coxwave |
| **Philippe Lucet<sup>(1)(2)(3)</sup>**<br>*Switzerland*<br>Director | August 26, 2025 | General Counsel of Valour, formerly General Counsel of SITA, formerly VP and General Counsel for R&D and Intellectual Property at Nestlé's global headquarters |
| **Mansour Al Suwaidi<sup>(1)(2)(3)</sup>**<br>*Mexico*<br>Director | August 26, 2025 | Chief Operating Officer of Bin Jadr Group |
| **Lionel de Saint-Exupéry<sup>(1)(2)(3)</sup>**<br>*Hong Kong*<br>Director | December 23, 2025 | Executive Chairman of Saintex Capital Management; former Vice Chairman of KGI Financial Holdings and CDIB Capital Group |

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Notes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Denotes a member of the audit committee of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Denotes a member of the compensation committee of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Denotes a member of the nomination and governance committee of the Company.

As of the date of this AIF, all directors and officers of BTQ, as a group, beneficially own, directly or indirectly, or exercise control or direction over, 44,174,259 Common Shares, representing 31.26% of the issued and outstanding Common Shares.

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**Biographies**

*Olivier Roussy Newton - Chief Executive Officer; Director.* Mr. Roussy Newton founded and led HIVE Blockchain Technologies, the first crypto mining company to list publicly on the TSX Venture Exchange in 2017. He is a partner at Latent Capital, an investment fund focused on quantum computing, financial technology and bioinformatics. He is also a co-founder and President of EV Technology Group Ltd. (EVT). Mr. Roussy Newton co-founded DeFi Technologies Inc. and its subsidiary Valour Inc., which bridges the gap between centralized and decentralized finance and is listed publicly on Cboe Canada and the Nasdaq.

*Lonny Wong - Chief Financial Officer.* Mr. Wong is a partner of Saturna Group Chartered Professional Accountants LLP. Saturna Group is a boutique firm located in Vancouver, BC, which specializes in providing auditing, assurance, financial reporting, and consulting services to public companies and companies looking to go public. He has over 30 years of public practice experience. Prior to co-founding Saturna Group in 2008, he worked at an independent mid-sized firm in Vancouver, BC. He holds a Bachelor of Arts from the University of British Columbia and is a Chartered Professional Accountant.

*Christopher Tam - President, Head of Innovation, and Director* **-** Mr. Tam is a software engineer and co-founder of Zero Computing, where he leads the development of specialized cloud infrastructure for computational niches. With deep expertise spanning artificial intelligence, quantum computing, and cloud technologies, Mr. Tam operates at the intersection of emerging technologies and business strategy. Prior to founding Zero Computing in 2024, he served as Head of Partnerships at BTQ, a quantum computing company focused on post-quantum cryptography solutions for blockchain applications, where he drove strategic alliances and product innovation. Mr. Tam holds a Master of Engineering Science in Software Engineering (M.E.Sc.) with an AI specialization from Western University (GPA 3.9), where he was awarded the Western Graduate Research Scholarship, and a Bachelor of Science (B.Sc.) in Computer Science.

*Dr. Gavin Brennen - Chief Quantum Officer -* Dr. Brennen is a professor of physics in the School of Mathematical and Physical Sciences at Macquarie University where he leads a theory research group working on quantum information and computation. He is co-director of the Australian Quantum Software Network and is a member of the Standards Australia Quantum Information Technology working group. He has served on the executive board of the Sydney Quantum Academy (2020-2025) and on the board for the Quantum Energy Initiative (2022-2025)

*Jeff Choi - Chief Strategy Officer* - Chief of Staff at Coxwave

*Philippe Lucet - Director* - Mr. Lucet is the General Counsel of Valour Inc., a leading issuer of Exchange Traded Products (ETPs). Before joining Valour, Mr. Lucet served as Group General Counsel at SITA, a global IT company headquartered in Geneva, where he oversaw all legal, regulatory, and compliance matters for the group. Previously, he was Vice President and General Counsel for R&D and Intellectual Property at Nestlé's global headquarters, leading a team responsible for patents, trademarks, digital, legal R&D, and health science, worldwide. Prior to Nestlé, Mr. Lucet was Lead Counsel at Richemont, the Swiss-based global luxury group, and an attorney-at-law at Salans/Dentons, specializing in corporate law, investments, innovation, and intellectual property. Mr. Lucet holds a master's degree in Economics and Finance from Sciences Po Paris, a Master's in International Affairs (Finance and Banking) from Columbia University, and a Master of Laws from Stanford University.

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*Mansour Al Suwaidi - Director* - Mr. Al Suwaidi serves as the COO at the family run Bin Jabr group and reports directly to the chairman and manages the day-to-day operations.

*Lionel de Saint-Exupéry - Director* - Mr. de Saint-Exupéry is the Executive Chairman of Saintex Capital Management, a family-owned platform that manages long-term capital across public and private markets, with a primary focus on venture capital, private equity, private credit, and real estate. He is the former Vice Chairman of KGI Financial Holdings ("KGI"), a leading publicly listed financial holding company in the Asia Pacific region with a market capitalization of approximately US$10 billion, and its investment arm, CDIB Capital Group ("CDIB"), where he also previously served as Chief Executive Officer. He remains actively involved with the group as a Senior Advisor and Investment Committee member.

<u>**Cease Trade Orders, Bankruptcies, Penalties or Sanctions**</u>

*Cease Trade Orders*

Other than the Company's management cease trade order in 2024 or as otherwise disclosed herein, to the best of the Company's knowledge, no director or executive officer of the Company is, or during the ten years preceding the date of this AIF has been, a director, chief executive officer or chief financial officer of any company that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) was the subject of a cease trade or similar order that denied the relevant company access to any exemptions under applicable securities legislation that was in effect for a period of more than 30 consecutive days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold the assets of that person.

*Penalties or Sanctions*

None of the directors or officers of the Company or a shareholder holding a sufficient number of securities of the Company to affect materially the control of the Company has been subject to any penalties or sanctions imposed by a court relating to securities legislation or by any securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or has been subject to any other penalties or sanctions imposed by a court or regulatory body or self-regulatory authority that would be likely to be considered important to a reasonable investor making an investment decision.

*Personal Bankruptcies* 

None of the directors or officers of the Company or a shareholder holding a sufficient number of securities of the Company to affect materially the control of the Company is, or within the 10 years before the date of this AIF, has been declared bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or has been subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold their assets.

<u>**Conflicts of Interest**</u>

There may from time to time be potential conflicts of interest to which some of the directors or officers of the Company will be subject in connection with the operations of the Company. Some of the individuals who are directors or officers of the Company are also directors and/or officers of other reporting and non-reporting issuers. Conflicts, if any, will be subject to the procedures and remedies provided under applicable laws. In particular, in the event that such a conflict of interest arises at a meeting of the Company's directors, a director who has such a conflict will abstain from voting for or against the approval of such participation or such terms, unless otherwise permitted by applicable laws. In accordance with applicable laws, the directors of the Company are required to act honestly, in good faith and in the best interests of the Company.

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To the best of the Company's knowledge, there are no known existing or potential conflicts of interest among the Company, its directors and officers or other members of management of the Company or of any proposed director, officer or other member of management as a result of their outside business interests except that certain of the directors and officers serve as directors and officers of other companies, and therefore it is possible that a conflict may arise between their duties to the Company and their duties as a director or officer of such other companies.

**AUDIT COMMITTEE DISCLOSURE**

**Audit Committee** 

The Audit Committee consists of individuals who are "independent" and "financially literate" within the meaning of National Instrument 52-110 - *Audit Committees*. The Company's Audit Committee is comprised of Lionel de Saint-Exupéry, Mansour Al Suwaidi, and Philippe Lucet. Each member of the Audit Committee has an understanding of the accounting principles used to prepare financial statements and varied experience as to the general application of such accounting principles, as well as an understanding of the internal controls and procedures necessary for financial reporting. For additional details regarding the relevant education and experience of each member of the Audit Committee, see the relevant biographical experiences for each member under the heading "Directors and Officers - Name, Occupation and Security Holdings" in this AIF.

The Board has adopted a written charter for the Audit Committee which sets out the Audit Committee's role of providing oversight of the Company's financial management and of the design and implementation of an effective system of internal financial controls as well as to review and report to the Board on the integrity of the financial statements of the Company, its subsidiaries and associated companies. This includes helping directors meet their responsibilities, facilitating better communication between directors and the external auditor, enhancing the independence of the external auditor, increasing the credibility and objectivity of financial reports and strengthening the role of the directors by facilitating in-depth discussions among directors, management and the external auditor.

The mandate of the Audit Committee is set out in the written charter of the Audit Committee. A copy of the Audit Committee charter is included as Appendix "A" hereto.

**Audit Committee Oversight**

At no time since the commencement of the Company's most recently completed financial year was a recommendation of the Audit Committee to nominate or compensate an external auditor not adopted by the Board.

**Pre-Approval Policies and Procedures**

The Audit Committee has adopted specific policies and procedures for the engagement of non-audit services as set out in the Audit Committee charter of the Company. The full text of the Company's Audit Committee charter is disclosed in Appendix "A" to this AIF.

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**External Auditor Service Fees**

*Audit Fees*

MNP LLP is expected to bill the Company $155,150 for the year ended December 31, 2025 for audit fees.

MNP LLP billed the Company $139,100 for the year ended December 31, 2024 for audit fees.

*Audit-Related Fees* 

MNP LLP billed the Company $145,250 for the year ended December 31, 2025 for assurance and related services related to the performance of the audit or review of the Company's financial statements, which are not included in audit fees.

MNP LLP billed the Company $37,450 for the year ended December 31, 2024 for assurance and related services related to the performance of the audit or review of the Company's financial statements, which are not included in audit fees.

*Tax Fees* 

MNP LLP billed the Company $8,560 for the year ended December 31, 2025 for tax fees.

No tax fees were charged by the external auditors for the year ended December 31, 2024.

*All Other Fees*

No other fees were charged by the external auditors for the years ended December 31, 2025 and 2024.

**PROMOTERS**

No person is or has been within the two financial years immediately preceding the date hereof, or during the current financial year, a promoter of the Company.

**LEGAL PROCEEDINGS AND REGULATORY ACTIONS**

There are no actual or pending legal proceedings material to the Company that the Company is or was a party to, or that any of its property is or was the subject of, since the beginning of the Company's most recently completed financial year. In addition, the Company is not currently aware of any such legal proceedings being contemplated.

**INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS**

Other than as disclosed elsewhere in this AIF, no director, executive officer or principal shareholder of the Company, or any associate or affiliate of the foregoing, has had any material interest, direct or indirect, in any transaction within the three most recently completed financial years or during the current financial year prior to the date of this AIF that has materially affected or will materially affect the Company.

**TRANSFER AGENTS AND REGISTRARS**

The transfer agent and registrar for the Common Shares is Computershare Trust Company of Canada, at 510 Burrard St., 3rd Floor, Vancouver, British Columbia, V6C 3B9, Canada.

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**MATERIAL CONTRACTS**

Other than the agency agreement dated July 11, 2025 entered into with the Agent in connection with the 2025 Offering, and as described herein, the Company has not entered into any material contracts in the past fiscal year, other than contracts entered into in the ordinary course of business.

**INTEREST OF EXPERTS**

The Company's external auditor during the year ended December 31, 2025 was MNP LLP. MNP LLP has advised the Company that it is independent of the Company in accordance with the Code of Professional Conduct of the Chartered Professional Accountants of Ontario and in compliance with PCAOB Rule 3520 and within the meaning of the federal securities laws administered by the SEC.

**ADDITIONAL INFORMATION** 

Additional information relating to the Company may be found under the Company's profile on SEDAR+ at <u>www.sedarplus.ca</u> and on EDGAR at <u>www.sec.gov</u>.

Additional information, including directors' and officers' remuneration and indebtedness, principal holders of securities of the Company and securities authorized for issuance under equity compensation plans, may be found in the Company's management information circular, which is also available on the Company's profile on SEDAR+ at <u>www.sedarplus.ca</u> and on EDGAR at <u>www.sec.gov</u>.

Additional financial information is provided in the Company's audited annual consolidated financial statements and the management's discussion and analysis for its most recently completed financial year, which are also available on the Company's profile on SEDAR+ at <u>www.sedarplus.ca</u> and on EDGAR at <u>www.sec.gov</u>.

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**APPENDIX "A"**

**BTQ TECHNOLOGIES CORP.** (the "**Company**")

**AUDIT COMMITTEE CHARTER** 

**I. ROLE AND OBJECTIVES**

The Audit Committee is a committee of the Board of Directors (the "**Board**") of BTQ Technologies Corp (the "**Corporation**") to which the Board has delegated certain oversight responsibilities relating to the Corporation's financial statements, external auditors, risk management, compliance with legal and regulatory requirements and management information technology. In this Charter, the Corporation and all entities controlled by the Corporation are collectively referred to as "**BTQ**".

The objectives of the Audit Committee are to maintain oversight of:

(a) the Corporation's accounting and financial reporting processes;

(b) the audits of the Corporation's financial statements;

(c) the integrity of the Corporation's financial statements, the reporting process and its internal control over financial reporting;

(d) the reports, qualifications, independence and performance of the Corporation's external auditor;

(e) the Corporation's risk identification, assessment and management program;

(f) the Corporation's compliance with applicable legal and regulatory requirements;

(g) the Corporation's management of information technology related to financial reporting and financial controls; and

(h) the maintenance of open channels of communication among management of the Corporation, the external auditors and the Board.

**II. MEMBERSHIP AND POLICIES**

The Board, based on recommendation from the Nomination and Governance Committee, will appoint or reappoint members of the Audit Committee. Each member shall serve until his or her successor is appointed unless the member resigns, is removed or ceases to be a director. The Board of Directors may fill a vacancy that occurs in the Committee at any time.

The Audit Committee must be composed of not less than three (3) members of the Board, each of whom must be independent pursuant to the rules and regulations of all applicable stock exchanges and United States and Canadian securities laws and regulations.

No member of the Audit Committee may have participated in the preparation of the financial statements of the Corporation or any of its then-current subsidiaries at any time during the immediately prior three years.

Each member of the Audit Committee must be financially literate, as determined by the Board, and be able to read and understand fundamental financial statements, including the Corporation's balance sheet, income statement, and cash flow statement. Additionally, at least one member of the Audit Committee must have accounting or related financial management expertise, as determined by the Board. A person who is an "audit committee financial expert" as defined in Item 407(d)(5)(ii) of Regulation S-K may be presumed to have accounting or related financial management expertise.

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The Board, in consultation with the Nomination and Governance Committee, will appoint or reappoint the Chair of the Audit Committee from amongst its members.

The Audit Committee may at any time retain outside financial, legal or other advisors as it determines necessary to carry out its duties, at the expense of the Corporation. The Corporation shall provide for appropriate funding, as determined by the Audit Committee in its capacity as a committee of the Board, for payment of: (i) compensation to the external auditor for the purpose of preparing or issuing an audit report or performing other audit, review or attestation services for the Corporation, (ii) compensation to any advisors employed by the Audit Committee, and (iii) ordinary administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties.

In discharging its duties under this Charter, the Audit Committee may investigate any matter brought to its attention and will have access to all books, records, facilities and personnel, may conduct meetings or interview any officer or employee, the Corporation's legal counsel, external auditors and consultants, and may invite any such persons to attend any part of any meeting of the Audit Committee.

The Audit Committee has neither the duty nor the responsibility to conduct audit, accounting or legal reviews, or to ensure that the Corporation's financial statements are complete, accurate and in accordance with International Financial Reporting Standards ("**IFRS**") as issued by the International Accounting Standards Board ("**IASB**"); rather, management is responsible for the financial reporting process, internal review process, and the preparation of the Corporation's financial statements in accordance with IFRS, and the Corporation's external auditor is responsible for auditing those financial statements.

**III. FUNCTIONS**

**A. Financial Statements, the Reporting Process and Internal Controls over Financial Reporting**

The Audit Committee will meet, as applicable, with management and the external auditor to review and discuss annual and quarterly financial statements, management's discussion and analyses ("**MD&A**"), any earnings press releases, other financial disclosures and earnings guidance provided to analysts and rating agencies, and determine whether to recommend the approval of such documents to the Board.

(a) In connection with these procedures, the Audit Committee will, as applicable and without limitation establish:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. a procedure for complaints relating to the receipt, retention, and treatment of complaints received by the Corporation regarding accounting, internal accounting controls, or auditing matters; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the confidential, anonymous submission by the Corporation's employees of concerns regarding questionable or auditing matters.

(b) In connection with these procedures, the Audit Committee will, as applicable and without limitation review and discuss with management and the external auditor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. the information to be included in the Corporation's financial statements and other financial disclosures which require approval by the Board including the Corporation's annual and quarterly financial statements, notes thereto, MD&A and any earnings press releases or earnings guidance provided to analysis and rating agencies, paying particular attention to any use of "pro forma", "adjusted" and "non-GAAP" information, and ensuring that adequate procedures are in place for the review of the Corporation's public disclosure of financial information extracted or derived from the financial statements;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. any significant financial reporting issues, including major issues regarding accounting principles and financial statement presentations, identified during the reporting period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. any change in accounting policies, or selection or application of accounting principles, and their impact on the Corporation's financial results and disclosure;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. all significant estimates and judgments, significant risks and uncertainties made in connection with the preparation of the Corporation's financial statements that may have a material impact to the financial statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. any significant deficiencies or material weaknesses identified by management or the external auditor, compensating or mitigating controls and the final assessment and impact of such deficiencies or material weaknesses on disclosure;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. any major issues as to the adequacy of the internal controls and any special audit steps adopted in light of material internal control deficiencies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. significant adjustments identified by management or the external auditor and the assessment of associated internal control deficiencies, as applicable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;viii. any unresolved issues between management and the external auditor that could materially impact the financial statements and other financial disclosures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ix. any material correspondence with regulators, government agencies, any employee or whistleblower complaints and other reports of non-compliance which raise issues regarding the Corporation's financial statements or accounting policies and significant changes in regulations which may have a material impact on the Corporation's financial statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;x. the effect of regulatory and accounting initiatives, as well as any off-balance sheet structures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xi. significant matters of concern respecting audits and financial reporting processes, including any illegal acts, that have been identified in the course of the preparation or audit of the Corporation's financial statements; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xii. any analyses prepared by management and/or the external auditor setting forth significant financial reporting issues and judgments made in connection with the preparation of financial statements including analyses of the effects of IFRS on the financial statements.

(c) In connection with the annual audit of the Corporation's financial statements, the Audit Committee will review with the external auditor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. prior to commencement of the annual audit, plans, scope, staffing, engagement terms and proposed fees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. reports or opinions to be rendered in connection with the audit including the external auditor's review or audit findings report including alternative treatment of significant financial information within IFRS that have been discussed with management and the associated impact on disclosure; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. the adequacy of internal controls, any audit problems or difficulties, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) any restrictions on the scope of the external auditor's activities or on access to requested information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) any significant disagreements with management, and management's response (including discussion among management, the external auditor and, as necessary, internal and external legal counsel);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) any litigation, claim or contingency, including tax assessments and claims, that could have a material impact on the financial position of the Corporation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) the impact on current or potential future disclosures.

In connection with its review of the annual audited financial statements and quarterly financial statements, the Audit Committee will also review any significant concerns raised during the Chief Executive Officer ("**CEO**") and Chief Financial Officer ("**CFO**") certifications with respect to the financial statements and BTQ's disclosure controls and internal controls. In particular, the Audit Committee will review with the CEO, CFO and external auditor: (i) all significant deficiencies, material weaknesses or significant changes in the design or operation of BTQ's internal control over financial reporting that could adversely affect the Corporation's ability to record, process, summarize and report financial information required to be disclosed by the Corporation in the reports that it files or submits under applicable securities laws, within the required time periods; and (ii) any fraud, whether or not material, that involves management of BTQ or other employees who have a significant role in BTQ's internal control over financial reporting. In addition, the Audit Committee will review with the CEO and CFO, BTQ's disclosure controls and procedures and periodically will review management's conclusions about the efficacy of disclosure controls and procedures, including any significant deficiencies, material weaknesses or material non-compliance with disclosure controls and procedures.

**B. The External Auditor**

The Audit Committee, in its capacity as a committee of the Board, is directly responsible for overseeing the relationship, reports, qualifications, independence and performance of the external auditor and audit services by other registered public accounting firms engaged by the Corporation. The Audit Committee has responsibility to take, or recommend that the Board take, appropriate action to oversee the independence of the external auditor. The Audit Committee shall have the authority and responsibility to recommend the appointment and the revocation of the appointment of the external auditors engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services, and to fix their remuneration.

The external auditor will report directly to the Audit Committee. The Audit Committee's appointment of the external auditor is subject to annual approval by the shareholders.

With respect to the external auditor, the Audit Committee is responsible for:

(a) the appointment, termination, compensation, retention and oversight of the work of the external auditor engaged by the Corporation for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for the Corporation, including the review and approval of the terms of the external auditor's engagement letter and the proposed fees;

(b) resolution of disagreements or disputes between management and the external auditor regarding financial reporting for audit, review or attestation services;

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(c) pre-approval of all audit services and legally permissible non-audit services to be provided by the external auditors considering the potential impact of such services on the independence of external auditors and, subject to any *de minimis* exemption available under applicable laws. Such approval of non-audit services can be given either specifically or pursuant to pre-approval policies and procedures adopted by the committee including the delegation of this ability to one or more members of the Audit Committee to the extent permitted by applicable law, provided that any pre-approvals granted pursuant to any such delegation may not delegate Audit Committee responsibilities to management of the Corporation, and must be reported to the full Audit Committee at the first scheduled meeting of the Audit Committee following such pre-approval;

(d) obtaining and reviewing, at least annually, a written report by the external auditor describing the external auditor's internal quality-control procedures, any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues and all relationships between the external auditors and the Corporation;

(e) obtaining a formal written statement delineating all relationships between the auditor and the Corporation, consistent with The Public Company Accounting Oversight Board Rule 3526, and discussing any disclosed relationships or services with the auditor and how they may impact the objectivity and independence of the auditor;

(f) review of the external auditor which assesses three key factors of audit quality for the Audit Committee to consider and assess including: independence, objectivity and professional skepticism; quality of the engagement team; and quality of communications and interactions with the external auditor. A written comprehensive review of the external auditor to be considered if required each year and completed at least every five (5) years which will include an:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. assessment of quality of services and sufficiency of resources provided by the external auditor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. assessment of auditor independence, objectivity and professional skepticism, including the review and evaluation of the lead partner of the external auditor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. assessment of value of services provided by the external auditor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. assessment of written input from external auditor summarizing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) background of firm, size, resources, geographical coverage, relevant industry experience, including reputational challenges, systemic audit quality issues identified by Canadian Public Accountability Board ("**CPAB**") and Public Company Accounting Oversight Board ("**PCAOB**") in public reports;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) industry experience of the audit team and plans for training and development of the team;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) how the external auditor demonstrated objectivity and professional skepticism during the audit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) how the firm and team met all criteria for independence including identification of all relationships that the external auditor has with the Corporation and its affiliates and steps taken to address possible institutional threats;

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) involvement of engagement quality reviewer ("**EQR**") partner and significant concerns raised by the EQR partner;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) matters raised to national office or specialists during the review;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) significant disagreements between management and the external auditors and steps taken to resolve such disagreements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) satisfaction with communication and cooperation with management and the Audit Committee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) findings and firm responses to reviews of the Corporation by CPAB and PCAOB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. communication of the results of the comprehensive review of the external auditor to the Board and recommending that the Board take appropriate action, in response to the review, as required. It is understood that the Audit Committee may recommend tendering the external auditor engagement at their discretion. In addition to rotation of the EQR partner as required by law, the Audit Committee, together with the Board, will also consider whether it is necessary to periodically rotate the external audit firm itself. It will be at the discretion of the Audit Committee if the incumbent external auditor is invited to participate in the tendering process; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. setting clear hiring policies for the Corporation regarding partners and employees and former partners and employees of the present and former external auditor of the Corporation. Before any such partner or employee is offered employment by the Corporation, prior approval from the Chair of the Audit Committee must be received and a one year grace period must pass from the date any work was last completed on an audit engagement before an external auditor employee can be considered for contract or employment by the Corporation.

**C. Risk Management**

The Audit Committee, in its capacity as a committee of the Board, is directly responsible for overseeing the risk identification, assessment and management program of the Corporation by discussing guidelines and policies to govern the process by which risk is identified, assessed and managed. Periodically, in conjunction with senior management, internal counsel and,

as necessary, external counsel the Corporation's external auditors and other advisers, as it deems necessary, the Audit Committee will review the following:

(a) the Corporation's method of reviewing significant risks inherent in BTQ's business, assets, facilities, and strategic directions, including the Corporation's risk management and evaluation process;

(b) discuss guidelines and policies with respect to risk assessment and risk management, including the Corporation's major financial risk exposures and the steps management has taken to monitor and control such exposures. The Audit Committee is not required to be the sole body responsible for risk assessment and management, but, as stated above, the committee must discuss guidelines and policies to govern the process by which risk assessment and management is undertaken.

(c) the major financial risk exposures and steps management has taken to monitor and manage such exposures;

(d) the Corporation's annual insurance report including its risk retention philosophy and resulting uninsured exposure, if any, including corporate liability protection programs for directors and officers;

------

(e) the Corporation's loss prevention policies, risk management programs, disaster response and recovery programs in the context of operational considerations; and

(f) other risk management matters from time to time as the Audit Committee may consider appropriate or the Board may specifically direct.

**A. Additional Duties and Responsibilities**

The Audit Committee will also:

(a) meet separately, and periodically, with management, the external auditor and, as is appropriate, internal and external legal counsel and independent advisors in respect of issues not elsewhere listed concerning any other audit, finance or risk matter;

(b) review the appointment of the CFO and any other key financial executives who are involved in the financial reporting process;

(c) review the Corporation's information technology practices as they relate to financial reporting;

(d) periodically review Directors' and Officers' Liability Insurance Coverage;

(e) from time to time, discuss staffing levels and competencies of the finance team with the external auditor;

(f) review incidents, alleged or otherwise, as reported by whistleblowers, management, the external auditor, internal or external counsel or otherwise, of fraud, illegal acts or conflicts of interest and establish procedures for receipt, treatment and retention of records of incident investigations;

(g) facilitate information sharing with other committees of the Board as required to address matters of mutual interest or concern in respect of the Corporation's financial reporting;

(h) assist Board oversight in respect of issues not elsewhere listed concerning the integrity of the Corporation's financial statements, the Corporation's compliance with legal and regulatory requirements, the independent auditor's qualifications and independence, and the performance of the external auditors;

(i) have the authority and responsibility to recommend the appointment and the revocation of the appointment of registered public accounting firms (in addition to the external auditors) engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services, and to fix their remuneration.

In addition, the Audit Committee will perform such other functions as are assigned by law and on the instructions of the Board.

**IV. MEETINGS**

Notice of each meeting of the Audit Committee will be given to each member and, if applicable, to the external auditors. The notice will:

(a) be in writing (which may be communicated by fax or email);

(b) be accompanied by an agenda that states the nature of the business to be transacted at the meeting in reasonable detail;

------

(c) include copies of documentation to be considered at the meeting and reasonably sufficient time to review documentation; and

(d) be given at least 48 hours preceding the time stipulated for the meeting, unless notice is waived by the Audit Committee members.

A quorum for a meeting of the Audit Committee is a majority of the members present in person, by video conference, webcast or telephone.

If the Chair is not present at a meeting of the Audit Committee, a Chair will be selected from among the members present. The Chair will not have a second or deciding vote in the event of an equality of votes.

At each meeting, the Audit Committee will meet "in-camera", without management or external auditors present, and will periodically, and at least annually, meet in separate sessions with the lead partner of the external auditor at least annually.

The Audit Committee may invite others to attend any part of any meeting of the Audit Committee as it deems appropriate. This includes other directors, members of management, any employee, the Corporation's internal or external legal counsel, external auditors, advisors and consultants.

Minutes will be kept of all meetings of the Audit Committee. The minutes will include copies of all resolutions passed at each meeting, will be maintained with the Corporation's records, and will be available for review by members of the Audit Committee, the Board, and the external auditor.

**V. OTHER MATTERS**

**A. Review of Charter**

The Audit Committee shall review and reassess the adequacy of this Charter annually, and propose recommended changes to the Nomination and Governance Committee.

**B. Reporting**

The Audit Committee shall report to the Board activities and recommendations of each Audit Committee meeting and review with the Board any issues that arise with respect to the quality or integrity of the Corporation's financial statements, the Corporation's compliance with legal or regulatory requirements, the performance and independence of the Corporation's external auditors, management information technology with respect to financial reporting matters, risk management and communication between the parties identified above.

**C. Evaluation**

The Audit Committee's performance shall be evaluated periodically by the Nomination and Governance Committee and the Board as part of the Board assessment process established by the Nomination and Governance Committee and the Board.

This Charter was last approved by the Board of Directors on January 24, 2025.

------

## Exhibit 99.2

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![](exhibit99-2x001.jpg)

**BTQ TECHNOLOGIES CORP.**

Consolidated Financial Statements

For the Years Ended December 31, 2025 and 2024

(Expressed in Canadian dollars)

------

---

| | |
|:---|:---|
| **Independent Auditor's Report** | ![](exhibit99-2xu001.jpg) |

---

To the Shareholders of BTQ Technologies Corp.:

**Opinion**

We have audited the consolidated financial statements of BTQ Technologies Corp. and its subsidiaries (the "Company"), which comprise the consolidated statements of financial position as at December 31, 2025 and 2024 and the consolidated statements of loss and other comprehensive loss, changes in shareholders' equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of material accounting policy information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at December 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended in accordance with IFRS® Accounting Standards as issued by the International Accounting Standard Board.

**Basis for Opinion**

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

**Material Uncertainty Related to Going Concern**

We draw attention to Note 1 in the consolidated financial statements, which indicates that the Company incurred a net loss and generated negative cash flows from operating activities during the year ended December 31, 2025. As stated in Note 1, these events and conditions, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

**Key Audit Matters**

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Except for the matter described in Material uncertainty related to going concern section, we have determined that there were no key audit matters to communicate in our report.

---

| | |
|:---|:---|
| **MNP LLP** |  |
| 1 Adelaide Street East, Suite 1900, Toronto ON, M5C 2V9 | 1.877.251.2922 T: 416.596.1711 F: 416.596.7894 |

---

------

**Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements**

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS® Accounting Standards as issued by the International Accounting Standard Board, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

**Auditor's Responsibilities for the Audit of the Consolidated Financial Statements**

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Company as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for the purposes of the group audit. We remain solely responsible for our audit opinion.

---

| | |
|:---|:---|
| *1 Adelaide Street East, Suite 1900, Toronto, Ontario, M5C 2V9*<br>*1.877.251.2922 T: 416.596.1711 F: 416.596.7894 MNP.ca* | ![](exhibit99-2xu002.jpg) |

---

------

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

The engagement partner on the audit resulting in this independent auditor's report is Eduard Shvekher.

---

| | |
|:---|:---|
|  | ![](exhibit99-2xu003.jpg) |
| Toronto, Ontario | Chartered Professional Accountants |
| March 30, 2026 | Licensed Public Accountants |

---

---

| | |
|:---|:---|
| *1 Adelaide Street East, Suite 1900, Toronto, Ontario, M5C 2V9*<br>*1.877.251.2922 T: 416.596.1711 F: 416.596.7894 MNP.ca* | ![](exhibit99-2xu002.jpg) |

---

------

**BTQ TECHNOLOGIES CORP.**<br>Consolidated Statements of Financial Position<br>(Expressed in Canadian dollars)

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025<br>$| December 31,<br>2024<br>$|
| Assets |  |  |
| Current assets |  |  |
| &nbsp;&nbsp;Cash | 20939224 | 9336892 |
| &nbsp;&nbsp;Short-term investments | 57500 |  |
| &nbsp;&nbsp;Other receivables (Note 13) | 53354 | 223109 |
| &nbsp;&nbsp;Prepaid expenses and deposits | 1366009 | 64643 |
| Total current assets | 22416087 | 9624644 |
| Non-current assets |  |  |
| &nbsp;&nbsp;&nbsp;Property and equipment | 19307 |  |
| &nbsp;&nbsp;&nbsp;Investments (Note 4) | 8136943 | 77229 |
| &nbsp;&nbsp;&nbsp;Investment in associate (Note 5) | 3214662 |  |
| &nbsp;&nbsp;&nbsp;Deposits |  | 29605 |
| Total non-current assets | 11370912 | 106834 |
| Total assets | 33786999 | 9731478 |
| Liabilities and shareholders' equity |  |  |
| Current liabilities |  |  |
| &nbsp;&nbsp;Accounts payable and accrued liabilities (Note 13) | 2151111 | 1450252 |
| &nbsp;&nbsp;Deferred revenue (Note 18) |  | 315497 |
| &nbsp;&nbsp;Due to related parties (Note 13) | 25882 | 27172 |
| Total liabilities | 2176993 | 1792921 |
| Shareholders' equity |  |  |
| &nbsp;&nbsp;Share capital (Note 8) | 87804670 | 45553931 |
| &nbsp;&nbsp;Options reserve (Notes 9) | 2268450 | 1890026 |
| &nbsp;&nbsp;Warrants reserve (Note 10) | 1843488 | 498876 |
| &nbsp;&nbsp;RSUs reserve (Note 11) | 4150202 | 640813 |
| &nbsp;&nbsp;PSUs reserve (Note 12) | 744158 |  |
| &nbsp;&nbsp;Shares to be issued (Note 8) | 50000 |  |
| &nbsp;&nbsp;Deficit | (65250962) | (40645089) |
| Total shareholders' equity | 31610006 | 7938557 |
| Total liabilities and shareholders' equity | 33786999 | 9731478 |

---

Going concern (Note 1)

Commitment (Note 22)

Subsequent events (Note 23)

Approved and authorized for issuance on behalf of the Board on March 30, 2026:

<u>*"*Olivier Roussy Newton*"*</u> Director <u>*"Lionel de Saint-Exupery"*</u> Director

(The accompanying notes are an integral part of these consolidated financial statements)<br>4

------

**BTQ TECHNOLOGIES CORP.**<br>Consolidated Statements of Operations and Comprehensive Loss<br>(Expressed in Canadian dollars)

---

| | | |
|:---|:---|:---|
|  | Year ended<br>December 31,<br>2025<br>$| Year ended<br>December 31,<br>2024<br>$|
| Revenue (Note 19) | 315497 | 666667 |
| Expenses |  |  |
| &nbsp;&nbsp;Business development, marketing, and promotion | 3097676 | 779967 |
| &nbsp;&nbsp;Consulting fees (Note 13) | 869128 | 216352 |
| &nbsp;&nbsp;Depreciation | 2030 | 86880 |
| &nbsp;&nbsp;General and administrative (Note 20) | 1102895 | 756017 |
| &nbsp;&nbsp;Professional fees (Note 13) | 2927556 | 1089994 |
| &nbsp;&nbsp;Research and development (Note 13) | 5601755 | 2732496 |
| &nbsp;&nbsp;Share-based compensation (Notes 9, 11, and 12) | 10592252 | 1063 |
| &nbsp;&nbsp;Transfer agent, filing, and listing fees | 958417 | 139377 |
| &nbsp;&nbsp;Wages and benefits (Note 13) | 210891 | 575532 |
| Total expenses | 25362600 | 6377678 |
| Loss before other income (expense) | (25047103) | (5711011) |
| Other income (expense) |  |  |
| &nbsp;&nbsp;Collaboration income (Note 19) |  | 108913 |
| &nbsp;&nbsp;Foreign exchange loss | (95229) | (62650) |
| &nbsp;&nbsp;Impairment of intangible asset (Note 6) |  | (275782) |
| &nbsp;&nbsp;Impairment of property and equipment |  | (52002) |
| &nbsp;&nbsp;Interest income | 263231 | 17876 |
| &nbsp;&nbsp;Interest expense (Note 7) |  | (54663) |
| &nbsp;&nbsp;Loss on sale of property and equipment |  | (25099) |
| &nbsp;&nbsp;Share of loss of equity accounted investee (Note 5) | (48859) |  |
| &nbsp;&nbsp;Unrealized gain on investments (Note 4) | 322087 |  |
| Total other income (expense) | 441230 | (343407) |
| Loss before income taxes | (24605873) | (6054418) |
| Income tax provision (Note 21) |  | (22318) |
| Net loss and comprehensive loss for the year | (24605873) | (6076736) |
| Loss per share, basic and diluted | (0.18) | (0.05) |
| Weighted average number of common shares outstanding | 135616093 | 124241167 |

---

(The accompanying notes are an integral part of these consolidated financial statements)<br>5

------

**BTQ TECHNOLOGIES CORP.**<br>Consolidated Statements of Changes in Shareholders' Equity<br>(Expressed in Canadian dollars)

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | Share capital | Share capital | Options<br>reserve<br>$ | Warrants<br>reserve<br>$ | RSUs reserve<br>$ | PSUs<br>reserve<br>$ | Shares to<br>be issued<br>$ | Deficit<br>$ | Total<br>shareholders'<br>equity<br>$ |
| | Number of<br>shares | Amount<br>$| Options<br>reserve<br>$ | Warrants<br>reserve<br>$ | RSUs reserve<br>$ | PSUs<br>reserve<br>$ | Shares to<br>be issued<br>$ | Deficit<br>$ | Total<br>shareholders'<br>equity<br>$ |
| Balance, December 31, 2024 | 131833688 | 45553931 | 1890026 | 498876 | 640813 |  |  | (40645089) | 7938557 |
| Shares issued for cash | 5555555 | 39999996 |  |  |  |  |  |  | 39999996 |
| Share issuance costs |  | (4397257) |  | 1357406 |  |  |  |  | (3039851) |
| Shares issued for options exercised | 1581250 | 1262981 | (604231) |  |  |  |  |  | 658750 |
| Shares issued for warrants exercised | 40437 | 28969 |  | (12794) |  |  |  |  | 16175 |
| Shares issued for vested RSUs | 1390000 | 5356050 |  |  | (5356050) |  |  |  |  |
| Proceeds received for options exercise |  |  |  |  |  |  | 50000 |  | 50000 |
| Share-based compensation |  |  | 982655 |  | 8865439 | 744158 |  |  | 10592252 |
| Net loss for the year |  |  |  |  |  |  |  | (24605873) | (24605873) |
| Balance, December 31, 2025 | 140400930 | 87804670 | 2268450 | 1843488 | 4150202 | 744158 | 50000 | (65250962) | 31610006 |

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(The accompanying notes are an integral part of these consolidated financial statements)<br>6

------

**BTQ TECHNOLOGIES CORP.**<br>Consolidated Statements of Changes in Shareholders' Equity<br>(Expressed in Canadian dollars)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | Share capital | Share capital | Equity portion<br>of convertible<br>debt<br>reserve<br>$ | Options<br>reserve<br>$ | Warrants<br>reserve<br>$ | RSUs<br>reserve<br>$ | Deficit<br>$ | Total<br>shareholders'<br>equity<br>$ |
| | Number of<br>shares | Amount<br>$| Equity portion<br>of convertible<br>debt<br>reserve<br>$ | Options<br>reserve<br>$ | Warrants<br>reserve<br>$ | RSUs<br>reserve<br>$ | Deficit<br>$ | Total<br>shareholders'<br>equity<br>$ |
| Balance, December 31, 2023 | 123193879 | 34317779 |  | 2018686 | 67386 | 1217252 | (34568353) | 3052750 |
| Shares issued for cash | 3355704 | 10000000 |  |  |  |  |  | 10000000 |
| Share issuance costs |  | (1331119) |  |  | 470286 |  |  | (860833) |
| Equity portion of convertible debt |  |  | 427483 |  |  |  |  | 427483 |
| Shares issued for options exercised | 560000 | 433662 |  | (209662) |  |  |  | 224000 |
| Shares issued for warrants exercised | 134105 | 92437 |  |  | (38796) |  |  | 53641 |
| Shares issued for vested RSUs | 840000 | 496500 |  |  |  | (496500) |  |  |
| Shares issued for the conversion of convertible debt | 3750000 | 1544672 | (427483) |  |  |  |  | 1117189 |
| Share-based compensation |  |  |  | 81002 |  | (79939) |  | 1063 |
| Net loss for the year |  |  |  |  |  |  | (6076736) | (6076736) |
| Balance, December 31, 2024 | 131833688 | 45553931 | - | 1890026 | 498876 | 640813 | (40645089) | 7938557 |

---

(The accompanying notes are an integral part of these consolidated financial statements)<br>7

------

**BTQ TECHNOLOGIES CORP.**<br>Consolidated Statements of Cash Flows<br>(Expressed in Canadian dollars)

---

| | | |
|:---|:---|:---|
|  | Year ended<br>December 31,<br>2025<br>$| Year ended<br>December 31,<br>2024<br>$|
| Operating activities |  |  |
| Net loss for the year | (24605873) | (6076736) |
| Items not involving cash: |  |  |
| &nbsp;&nbsp;Depreciation | 2030 | 86880 |
| &nbsp;&nbsp;Foreign exchange translation loss (gain) | (1290) | 5787 |
| &nbsp;&nbsp;Gain from termination of lease |  | (2783) |
| &nbsp;&nbsp;Impairment of intangible assets |  | 275782 |
| &nbsp;&nbsp;Impairment of property and equipment |  | 52002 |
| &nbsp;&nbsp;Interest expense |  | 54663 |
| &nbsp;&nbsp;Loss on disposal of property and equipment |  | 25099 |
| &nbsp;&nbsp;Share-based compensation | 10592252 | 1063 |
| &nbsp;&nbsp;Share of loss of equity accounted investee | 48859 |  |
| &nbsp;&nbsp;Unrealized gain on investments | (322087) |  |
| Changes in non-cash operating working capital: |  |  |
| &nbsp;&nbsp;Other receivables | 169755 | (102540) |
| &nbsp;&nbsp;Prepaid expenses and deposits | (1277512) | 144174 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | 700859 | 525543 |
| &nbsp;&nbsp;&nbsp;Deferred revenue | (315497) | 315497 |
| Net cash used in operating activities | (15008504) | (4695569) |
| Investing activities |  |  |
| &nbsp;&nbsp;&nbsp;Acquisition of short-term investments | (57500) |  |
| &nbsp;&nbsp;&nbsp;Redemption of short-term investments |  | 577875 |
| &nbsp;&nbsp;&nbsp;Acquisition of investments | (7737627) |  |
| &nbsp;&nbsp;&nbsp;Acquisition of investment in associate | (3263521) |  |
| &nbsp;&nbsp;&nbsp;Acquisition of intangible asset |  | (275782) |
| &nbsp;&nbsp;&nbsp;Acquisition of property and equipment | (21337) |  |
| &nbsp;&nbsp;&nbsp;Proceeds from disposal of property and equipment |  | 10946 |
| &nbsp;&nbsp;&nbsp;Proceeds from deposits | 5751 | 17037 |
| Net cash provided by (used in) investing activities | (11074234) | 330076 |
| Financing activities |  |  |
| &nbsp;&nbsp;Proceeds from convertible debt |  | 1500000 |
| &nbsp;&nbsp;Repayment of lease obligation |  | (76446) |
| &nbsp;&nbsp;Proceeds from issuance of shares / shares to be issued | 40724921 | 10277641 |
| &nbsp;&nbsp;Share issuance costs | (3039851) | (860833) |
| Net cash provided by financing activities | 37685070 | 10840362 |
| Increase in cash | 11602332 | 6474869 |
| Cash, beginning of year | 9336892 | 2862023 |
| Cash, end of year | 20939224 | 9336892 |

---

Supplemental cash flow information (Note 14)

(The accompanying notes are an integral part of these consolidated financial statements)<br>8

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**1. CORPORATE INFORMATION AND GOING CONCERN**

BTQ Technologies Corp. (formerly Sonora Gold & Silver Corp.) ("the Company") was incorporated on November 23, 1983 under the Business Corporations Act (British Columbia). The principal activity of the Company is the development of computer-based technology related to post-quantum cryptography, particularly as it applies to blockchain and related technologies, and their protection from the emerging security risk of quantum computing. The Company's registered office is located at Suite 2500, 700 West Georgia Street, Vancouver, BC, Canada, V7Y 1B3. The Company's common shares trade on both Cboe Canada and Nasdaq under the ticker symbol "BTQ".

These consolidated financial statements have been prepared on the going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. During the year ended December 31, 2025, the Company has a net loss and negative cash flow from operations. As at December 31, 2025, the Company has an accumulated deficit of $65,250,962. The Company's ability to continue its operations and to realize its assets at their carrying values is dependent upon obtaining additional financing and generating revenues sufficient to cover its operating costs. Management is of the opinion that sufficient working capital will be obtained from external financing to meet the Company's liabilities and commitments as they become due, although there is a risk that additional financing will not be available on a timely basis or on terms acceptable to the Company. These factors indicate a material uncertainty that may cast significant doubt on the ability of the Company to continue as a going concern. These consolidated financial statements do not reflect any adjustments that may be necessary if the Company is unable to continue as a going concern. Such adjustments could be material.

**2. BASIS OF PRESENTATION**

**Statement of Compliance**

The accompanying consolidated financial statements have been prepared in accordance with IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") on a going concern basis.

**Basis of Preparation**

These consolidated financial statements have been prepared on a historical cost basis except for certain financial assets and liabilities, which are measured at fair value, as specified by IFRS for each type of asset, liability, income, and expense as set out in the accounting policies below.

**Basis of Consolidation**

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, BTQ AG, a company incorporated in the Principality of Liechtenstein, BTQ Technologies Australia Pty Ltd., a company incorporated in Australia, and BTQ Technologies (USA) Ltd. a company incorporation in the State of Delaware, U.S.

These consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances are eliminated on consolidation. Control exists where the parent entity has power over the investee and is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Subsidiaries are included in the financial statements from the date control commences until the date control ceases.

**Functional Currency and Presentation Currency**

The functional currency of the Company and its subsidiaries is the Canadian dollar, which is also the presentation currency of these consolidated financial statements.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**2. BASIS OF PRESENTATION** (continued)

**Use of Estimates and Judgments**

The preparation of these consolidated financial statements in conformity with IFRS requires the Company's management to make judgments, estimates, and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, revenues, and expenses. Estimates and underlying assumptions are reviewed on an ongoing basis, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. Revisions to accounting estimates are recognized in the period in which the estimate is revised and in any future periods affected.

Significant estimates and judgments exercised by management in applying the Company's accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements are as follows:

<u>*Research and development costs*</u>

Research costs are recognized as an expense when incurred but development costs may be capitalized as intangible assets if certain conditions are met as described in IAS 38 *Intangible Assets*. Management has determined that development costs do not meet the conditions for capitalization under IAS 38 and all research and development costs have been expensed.

<u>*Fair values of stock options*</u>

Fair values of stock options are determined using the Black-Scholes option pricing model. Estimating fair value requires determining the most appropriate valuation model for a grant of equity instruments, which is dependent on the terms and conditions of the grant. Option-pricing models require the use of highly subjective estimates and assumptions including the expected stock price volatility. Changes in the underlying assumptions can materially affect the fair value estimates and, therefore, existing models do not necessarily provide reliable measurement of the fair value of the Company's stock options and performance warrants.

<u>*Deferred income taxes*</u>

The determination of income tax expense and the composition of deferred income tax assets and liabilities involves judgment and estimates as to the future taxable earnings, expected timing of reversals of deferred income tax assets and liabilities, and interpretations of tax laws. The Company is subject to assessments by tax authorities who may interpret the tax law differently. Changes in these interpretations, judgments, and estimates may materially affect the final amount of current and deferred income tax provisions, deferred income tax assets and liabilities, and results of operations.

<u>*Going concern presentation*</u>

These consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The assessment of the Company's ability to source future operations and continue as a going concern involves judgement. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. If the going concern assumption is not appropriate for the financial statements, then adjustments would be necessary in the carrying value of the assets and liabilities, the reported revenue and the expenses and the statement of financial position classifications used.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. BASIS OF PRESENTATION** (continued)

**Use of Estimates and Judgments** (continued)

<u>*Judgment of significant influence over an investment*</u>

Where the Company holds less than 20% of voting rights in an investment, but the Company has the power to exercise significant influence, such an investment is treated as an associate. The determination of whether the Company has significant influence over an investee requires the application of significant judgment. In making this assessment, management considers all relevant facts and circumstances, including ownership interest, governance arrangements, contractual rights, and the Company's ability to participate in financial and operating policy decisions.

<u>*Impairment of investment in associate*</u>

The Company reviews and assesses the carrying amount of investment in associates for indicators of impairment when facts or circumstances suggest that the carrying amount is not recoverable. Determination of carrying amount is subject to estimates and assumptions about the underlying data. Changes to these estimates may affect value of investment and the impairment recognized.

<u>*Impairment of non-current assets*</u>

The Company evaluates the recoverability of non-current assets, including property and equipment, right of use assets, and definite life intangible assets, whether events or changes in circumstances indicate that the carrying value of the asset, or asset group, may not be recoverable. When the Company determines that the carrying value of the long-lived asset may not be recoverable based upon the existence of one or more of the indicators, the assets are assessed for impairment based on the estimate of future discounted. If the carrying value of an asset exceeds its estimated recoverable amount, an impairment loss is recorded for the excess of the asset's carrying value over its recoverable amount. Management judgment is required in the determination of indicators of impairment.

<u>*Convertible debt*</u>

Convertible debt are financial instruments which contain a separate financial liability and equity instrument. The identification of such components embedded within a convertible debt requires significant judgment given that it is based on the interpretation of the substance of the contractual arrangement. The individual fair values attributed to the different components of a financing transaction, and/or derivative financial instruments, are determined using valuation techniques. The Company uses judgment to select the methods used to make certain assumptions and in performing the fair value calculations in order to determine the values attributed to each component of a transaction at the time of their issuance. These valuation estimates could be significantly different because of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an active market.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MATERIAL ACCOUNTING POLICY INFORMATION**

**Cash and Cash Equivalents**

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance, are readily convertible to known amounts of cash, and which are subject to insignificant risk of changes in value to be cash equivalents.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Property and Equipment**

The Company depreciates the cost of property and equipment over their estimated useful lives using the declining balance basis at the following rates:

---

| | |
|:---|:---|
| Computer equipment | 55% |
| Furniture and equipment | 20% |

---

Residual values and useful economic lives are reviewed at least annually, and adjusted if appropriate, at each reporting date. Subsequent expenditure relating to an item of property and equipment is capitalized when it is probable that future economic benefits from the use of the assets will be increased. All other subsequent expenditures are recognized as repairs and maintenance expenses during the period in which they are incurred. Gains and losses on disposal of equipment are determined by comparing the proceeds from disposal with the carrying amount of the asset and are recognized net within other income in the consolidated statement of operations and comprehensive loss.

**Impairment of Non-Current Assets**

At each reporting date, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there are any indications of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment, if any.

Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash generating unit ("CGU") to which the asset belongs. The recoverable amount is determined as the higher of fair value less direct costs to sell and the asset's value in use. In assessing value in use, the estimated future cash flows are discounted to their present value. Estimated future cash flows are calculated using estimated recoverable reserves, estimated future commodity prices, and the expected future operating and capital costs. The pre-tax discount rate applied to the estimated future cash flows reflects current market assessments of the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted.

If the carrying amount of an asset or CGU exceeds its recoverable amount, the carrying amount of the asset or CGU is reduced to its recoverable amount through an impairment charge to the consolidated statement of operations and comprehensive loss.

Assets that have been impaired are tested for possible reversal of the impairment whenever events or changes in circumstance indicate that the impairment may have reversed. When an impairment subsequently reverses, the carrying amount of the asset or CGU is increased to the revised estimate of its recoverable amount, but only so that the increased carrying amount does not exceed the carrying amount that would have been determined (net of depreciation, depletion and amortization) had no impairment loss been recognized for the asset or CGU in prior periods. A reversal of impairment is recognized as a gain in the consolidated statement of operations and comprehensive loss.

**Foreign Currency Translation**

The functional currency of the Company and its subsidiaries is the currency of the primary economic environment in which the entity operates. The Company's and its subsidiaries' functional currency is the Canadian dollar.

Transactions denominated in currencies other than the functional currency are translated using the exchange rate in effect on the transaction date or at the annual average rate. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange in effect at the consolidated statements of financial position date. Non-monetary items are translated using the historical rate on the date of the transaction. Foreign exchange gains and losses are included in the consolidated statement of operations and comprehensive loss.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Financial Instruments**

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the respective instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are included in the initial carrying value of the related instrument and are amortized using the effective interest method. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in the consolidated statement of operations and comprehensive loss.

Fair value estimates are made at the statement of financial position date based on relevant market information and information about the financial instrument. All financial instruments are classified into either: fair value through profit or loss ("FVTPL") or amortized cost.

The Company has made the following classifications:

---

| | |
|:---|:---|
| Cash | Amortized cost |
| Short-term investments | Amortized cost |
| Other receivables (excluding GST) | Amortized cost |
| Deposits | FVTPL |
| Investments | FVTPL |
| Accounts payable and accrued liabilities | Amortized cost |
| Due to related parties | Amortized cost |

---

*<u>Financial assets</u>*

IFRS 9 – Financial Instruments ("IFRS 9") establishes three primary measurement categories for financial assets: amortized cost, fair value through other comprehensive income ("FVOCI") and fair value through profit or loss ("FVTPL"). The Company determines the classification of the financial assets at initial recognition. The basis of classification depends on the Company's business model for managing its financial instruments and the contractual cash flow characteristics of the instrument.

A financial asset (unless it is a trade receivable without a significant financing component that is initially measured at the transaction price) is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition. Subsequent to initial recognition, financial assets are measured at amortized cost using the effective interest method, less any impairment.

*Financial assets at amortized cost*

Financial assets are measured at amortized cost if they are not designated at FVTPL, and the following conditions are met:

* are non-derivative financial assets which are held within a business model whose objective is to hold assets to collect contractual cash flows and selling financial assets; and,

* the contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

*Financial assets at FVTOCI*

Financial assets are measured at fair value through other comprehensive income only if they not designated at FVTPL, and the following conditions are met:

* it has been held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and,

* the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Financial Instruments** (continued)

*<u>Financial assets</u>* (continued)

*Financial assets at FVTOCI* (continued)

Interest income is calculated using the effective interest method and gains or losses arising from impairment and foreign exchange are recognized in the consolidated statement of operations and comprehensive loss. All other changes in the carrying amount of financial assets are recognized in other comprehensive income. Upon derecognition, the cumulative gain or loss previously recognized in other comprehensive income is reclassified to the consolidated statement of operations and comprehensive loss. The Company does not hold any financial assets measured at fair value through other comprehensive income.

*Financial assets at FVTPL*

Assets that do not meet the criteria to be measured at amortized cost, or fair value through other comprehensive income, are measured at fair value through profit or loss. All interest income and changes in the financial assets' carrying amount are recognized in the consolidated statement of operations and comprehensive loss.

*Impairment of financial assets*

Financial assets, other than those classified as FVTPL, are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been decreased.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account.

When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are offset against the allowance account. Changes in the carrying amount of the allowance account are recognized in the consolidated statement of operations and comprehensive loss. Loss allowances are based on the lifetime expected credit losses that result from all possible default events over the expected life of the trade receivable, using the simplified approach.

For financial assets measured at amortized cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss is reversed through the consolidated statement of operations and comprehensive loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.

*<u>Financial liabilities and equity instruments</u>*

*Classification as debt or equity*

Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

*Equity instruments*

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognized as the proceeds received, net of direct issue costs.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Financial Instruments** (continued)

*<u>Financial liabilities and equity instruments</u>* (continued)

*Other financial liabilities*

Other financial liabilities (including loans and borrowings and trade payables and other liabilities) are initially measured at fair value, net of transaction costs. Subsequently, other financial liabilities are measured at amortized cost using the effective interest method.

The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

**Revenue Recognition**

The Company's accounting policy for revenue recognition under IFRS 15, Revenue from Contracts with Customers, follows a five-step model to determine the amount and timing of revenue to be recognized:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Identifying the contract with a customer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Identifying the performance obligations within the contract;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Determining the transaction price;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Allocating the transaction price to the performance obligations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Recognizing revenue when/as performance obligation(s) are satisfied.

Revenue is recognized when or as the associated performance obligations are delivered and based on the expected consideration to be received. The Company generates revenues from licensing the right to use the Company's intellectual property. The fees that are outlined in an agreement are recognized when the Company's obligations have been performed. For licenses with multiple performance obligations, the Company will identify specific distinct goods and services and will recognize revenue when the performance obligations for each distinct good or service has been performed.

The Company also analyzes its collaboration arrangements to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities. This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. The Company assesses whether there are any elements of the collaboration that are more reflective of a vendor-customer relationship and is therefore within the scope of IFRS 15. For these elements of the arrangement that are accounted for pursuant to IFRS 15, the Company applies the five-step model above. The collaboration arrangements entered into during the years ended December 31, 2025 and 2024 did not meet the scope of IFRS 15. Refer to Note 19.

IFRS 11 characterizes a joint arrangement as parties that are bound by a contractual arrangement, and that the contractual arrangement gives two or more of those parties joint control over the arrangement. The Company assessed all of the collaboration agreements entered into during the years ended December 31, 2025 and 2024, and determined that none of the collaboration agreements met the characteristics of a joint arrangement due to the absence of joint control.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Research and Development Costs**

Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in the consolidated statement of operations and comprehensive loss as incurred.

Development activities involve a plan or design for the production of new or substantially improved products or processes. Development expenditure is capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and the Company intends to and has sufficient resources to complete development and to use or sell the asset. The expenditure capitalized includes the cost of materials, direct labour, overhead costs that are directly attributable to preparing the asset for its intended use, and borrowing costs on qualifying assets. Other development expenditures are recognized in the consolidated statements of operations and comprehensive loss as incurred.

**Share-based Compensation**

The grant date fair value of equity-based payment awards granted to employees is generally recognized as share-based compensation expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognized as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

Equity-settled share-based payment transactions with parties other than employees are measured at the fair value of the goods or services received, except where that fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date the entity obtains the goods or the counterparty renders the service.

The fair value of stock options is measured at the grant date using the Black-Scholes option pricing model. The fair value is recognized as an expense over the vesting period, which is the period over which all of the specified vesting conditions are satisfied with a corresponding increase in equity. For awards with graded vesting, the fair value of each tranche is recognized over its respective vesting period. Non-market vesting conditions are considered in making assumptions about the number of awards that are expected to vest. When the options are exercised, any proceeds received are credited to share capital along with the amount reflected in share-based payment reserve.

**Convertible Debentures**

Convertible debentures are financial instruments which in accordance to IAS 32 contain a separate financial liability and equity instrument or derivative liability. These financial instruments are accounted for separately dependent on the nature of their components. The identification of such components embedded within a convertible debenture requires significant judgment given that it is based on the interpretation of the substance of the contractual arrangement. The debt component is measured at fair value on the initial recognition using a market interest rate and the residual value assigned to the equity conversion feature. Subsequent to initial recognition, the equity conversion feature is not re-measured while the debt components are accreted to the face value of the convertible debenture using the effective interest rate through periodic charges to finance expense over the term of the convertible debenture. When the convertible debenture converted to shares under original terms of the convertible debenture, the carrying amount of the debt component is derecognized and recorded as share capital in the consolidated statement of changes in shareholders' equity.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Investment in Associate**

An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies. The considerations made in determining significant influence or joint control are similar to those necessary to determine control over subsidiaries. The Company's investment in its associate is accounted for using the equity method. Under the equity method, the investment in an associate is initially recognized at cost. The carrying amount of the investment is adjusted to recognize changes in the Company's share of net assets of the associate or joint venture since the acquisition date. Goodwill relating to the associate or joint venture is included in the carrying amount of the investment and is not tested for impairment separately. The consolidated statement of operations and comprehensive loss reflects the Company's share of the results of operations of the associate. Any change in other comprehensive income of those investees is presented as part of the Company's other comprehensive income. In addition, when there has been a change recognized directly in the equity of the associate, the Company recognizes its share of any changes, when applicable, in the consolidated statement of changes in shareholders' equity. Unrealized gains and losses resulting from transactions between the Company and the associate are eliminated to the extent of the interest in the associate. The aggregate of the Company's share of operating results of an associate is shown on the face of the consolidated statement of operations and comprehensive loss and represents net income or loss after tax and non-controlling interests in the subsidiaries of the associate. The consolidated financial statements of the associate are prepared for the same reporting period as the Company. When necessary, adjustments are made to bring the accounting policies in line with those of the Company. The Company's share of an associate's losses that are in excess of its investment in the associate are recognized only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate.

After application of the equity method, the Company determines whether it is necessary to recognize an impairment loss on its investment in its associate. At each reporting date, the Company determines whether there is objective evidence that the investment in the associate is impaired. If there is such evidence, the Company calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value, and then recognizes the loss in the consolidated statement of operations and comprehensive loss.

Upon loss of significant influence over the associate, the Company measures and recognizes any retained investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained investment and proceeds from disposal is recognized in the consolidated statement of operations and comprehensive loss.

**Related Party Transactions**

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

**Loss Per Share**

Basic loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. The computation of diluted loss per share assumes the conversion, exercise or contingent issuance of securities only when such conversion, exercise or issuance would have a dilutive effect on the income per share. The dilutive effect of convertible securities is reflected in the diluted loss per share by application of the "if converted" method. When a loss is incurred during the period, basic and diluted loss per share are the same as the exercise of stock options, share purchase warrants, and restricted share units is considered to be anti-dilutive. As at December 31, 2025, the Company has 7,020,223 (2024 - 6,886,616) potentially dilutive shares outstanding.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Income Taxes** 

Tax expense recognized in the consolidated statements of operations and comprehensive loss comprises the sum of current and deferred income taxes not recognized in other comprehensive income or directly in equity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*i) Current income tax*

Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date, in the countries where the Company operates and generates taxable income.

*ii) Deferred income tax* 

Deferred income tax is recognized using the liability method on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. However, the deferred income tax is not recognized if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable income or loss and that at the time of the transaction, does not give rise to equal taxable and deductible temporary differences. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the reporting date and are expected to apply when the related deferred income tax asset is realized, or the deferred income tax liability is settled. A deferred income tax asset is recognized to the extent that it is probable that future taxable income will be available against which the temporary difference can be utilized. Deferred income tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Changes in deferred income tax assets or liabilities are recognized as a component of tax income or expense in the consolidated statement of operations and comprehensive loss except where they related to items that are recognized in other comprehensive income or directly in equity, in which case, related deferred tax is also recognized in other comprehensive income or equity, respectively.

Deferred income tax assets and liabilities have been offset where they relate to income taxes levied by the same taxation authority and the Company has the legal right and intent to offset.

**Recent Accounting Pronouncements**

A number of new standards, and amendments to standards and interpretations, are not yet effective for the year ended December 31, 2025, and have not been early adopted in preparing these consolidated financial statements.

*IFRS 18 Presentation and Disclosure in Financial Statements*

In April 2024, the IASB issued IFRS 18 – Presentation and Disclosure in Financial Statements which will replace IAS 1, Presentation of Financial Statements. The key new concepts introduced in IFRS 18 relate to the structure of the consolidated statement of earnings (loss), required disclosures in the consolidated financial statements for certain earnings or loss performance measures that are reported outside an entity's consolidated financial statements and enhanced principles on aggregation and disaggregation which apply to the primary consolidated financial statements and notes in general. IFRS 18 will apply for reporting periods beginning on or after January 1, 2027, and also applies to comparative information. The Company is still in the process of assessing the impact of this standard on its consolidated financial statements.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**3. MATERIAL ACCOUNTING POLICY INFORMATION** (continued)

**Recent Accounting Pronouncements** (continued)

*Amendments to the Classification and Measurement of Financial Instruments ("Amendments to IFRS 9 and IFRS 7")*

In May 2024, the IASB issued Amendments to IFRS 9 and IFRS 7 which clarify the date of recognition and derecognition of some financial assets and liabilities with a new exception for some financial liabilities settled through an electronic cash transfer system, clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest criterion, add new disclosures for certain instruments with contractual terms that can change cash flows such as instruments with features linked to the achievement of environment, social and governance targets; and update the disclosures for equity instruments designated at FVOCI. Amendments to IFRS 9 and IFRS 7 is effective for periods beginning on or after January 1, 2026, with early adoption permitted. The Company is still in the process of assessing the impact of this standard on its consolidated financial statements.

**4. INVESTMENTS**

---

| | |
|:---|:---|
|  | $|
| &nbsp;&nbsp;Balance, December 31, 2023 and 2024 | 77229 |
| &nbsp;&nbsp;&nbsp;&nbsp;Additions | 7737627 |
| &nbsp;&nbsp;&nbsp;&nbsp;Unrealized gain | 322087 |
| &nbsp;&nbsp;Balance, December 31, 2025 | 8136943 |

---

During the year ended December 31, 2022, the BTQ AG invested $63,915 (US$50,000) in the form of a Simple Agreement for Future Equity ("SAFE") in the Holonym Foundation ("Holonym"), which is a public benefit corporation. The investment is not traded in an active market.

On January 11, 2023, BTQ AG invested $13,314 (US$10,000) in the form of a SAFE into Cysic Inc. The investment is not traded in an active market.

On November 18, 2025, BTQ Technologies Corp. invested $960,821 (KRW1,000,320,000) in the form of a SAFE into Genesis Quantum Inc. The investment is not traded in an active market.

The Company estimated the fair value of these SAFE investments and concluded that the carrying value approximates the fair value of the investments as at December 31, 2025 and 2024.

On December 15, 2025, the Company entered into an agreement in which it acquired 452,058 common shares of ICTK Co., Ltd., a publicly traded company in South Korea for $6,776,806. As at December 31, 2025, the fair market value of the investment was $7,098,893, resulting in an unrealized gain of $322,087 for the year ended December 31, 2025. The investment has a lock up period of two years.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**5.** I**NVESTMENT IN ASSOCIATE**

On November 7, 2025, the Company entered into an Ordinary Share Subscription Agreement with QPerfect SA ("QPerfect"), wherein the Company acquired 217,865 QPerfect ordinary shares for $3,263,521 (€2,000,000).

The Company holds a 15.29% interest in QPerfect over which the Company has determined that it holds significant influence as:

* the Company appointed a director to the Board of Directors and the director has the ability to veto or approve a number of management decisions.

Accordingly, the investment is accounted for using the equity method.

---

| |
|:---|
| &nbsp;&nbsp;Balance, December 31, 2023 and 2024 |
| &nbsp;&nbsp;&nbsp;&nbsp;Addition |
| &nbsp;&nbsp;&nbsp;&nbsp;Share of net loss) |
| &nbsp;&nbsp;Balance, December 31, 2025 |

---

**6. INTANGIBLE ASSETS**

On July 23, 2024, the Company entered into an agreement to purchase the intellectual property relating to four US patent applications for $275,782. As at December 31, 2024, the Company recognized an impairment of $275,782 due to the uncertainty of future cash flows.

**7. CONVERTIBLE DEBT**

On September 9, 2024, the Company issued convertible debt for proceeds of $1,000,000. The convertible debt is non-interest bearing and due on September 9, 2026. At the election of the lender, the principal amount of the debt is convertible into common shares at $0.40 per share. The present value of the liability component of the convertible debt at issuance was $694,445, using a discount rate of 20%, which is the estimated interest rate the Company would pay on a similar debt instrument without a conversion option. The residual value of $305,555 was allocated to the equity component. The discount on the convertible debt totaling $305,555 is amortized over the term of the convertible loans using the effective interest rate method. During the year ended December 31, 2024, the Company recorded accretion of $37,905 which is included in interest expense. On December 24, 2024, the debt was converted into common shares, refer to Note 8.

On November 8, 2024, the Company entered into a convertible debt agreement for proceeds of $500,000. The convertible debt is non-interest bearing and due on November 14, 2026. At the election of the lender, the principal amount of the debt is convertible into common shares at $0.40 per share. The present value of the liability component of the convertible debt at issuance was $378,072, using a discount rate of 15%, which is the estimated interest rate the Company would pay on a similar debt instrument without a conversion option. The residual value of $121,928 was allocated to the equity component. The discount on the convertible debt totaling $121,928 is amortized over the term of the convertible loans using the effective interest rate method. During the year ended December 31, 2024, the Company recorded accretion of $6,768 which is included in interest expense. On December 24, 2024, the debt was converted into common shares, refer to Note 8.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**8. SHARE CAPITAL**

Authorized: Unlimited number of common shares without par value

Share transactions during the year ended December 31, 2025:

* During the year ended December 31, 2025, the Company issued 1,581,250 common shares for proceeds of $658,750 pursuant to the exercise of stock options. The fair value of stock options exercised of $604,231 was transferred from options reserve to share capital.

* During the year end December 31, 2025, the Company issued 40,437 common shares for proceeds of $16,175 pursuant to the exercise of warrants. The fair value of warrants exercised of $12,794 was transferred from warrants reserve to share capital.

* During the year ended December 31, 2025, the Company issued 1,390,000 common shares pursuant to the conversion of vested RSUs. Upon conversion, the fair value of $5,356,050 for the vested RSUs was transferred from RSUs reserve to share capital.

* On July 11, 2025, the Company issued 5,555,555 common shares at $7.20 per share for gross proceeds of $39,999,996. In connection with the financing, the Company incurred share issuance costs of $3,039,851 and issued 138,888 finders' warrants exercisable at $12.60 per common share expiring on July 11, 2030. The fair value of the finders' warrants was determined to be $1,357,406 which was calculated using the Black-Scholes option pricing model with the following assumptions: volatility of 195%, expected life of 5 years, no dividends, and a risk-free rate of 3.06%.

* As at December 31, 2025, the Company has received proceeds of $50,000 for the exercise of stock options. Refer to Note 23(d).

Share transactions during the year ended December 31, 2024:

* During the year ended December 31, 2024, the Company issued 560,000 common shares for proceeds of $224,000 pursuant to the exercise of stock options. The fair value of stock options exercised of $209,662 was transferred from options reserve to share capital.

* During the year end December 31, 2024, the Company issued 134,105 common shares for proceeds of $53,641 pursuant to the exercise of warrants. The fair value of warrants exercised of $38,796 was transferred from warrants reserve to share capital.

* During the year ended December 31, 2024, the Company issued 840,000 common shares pursuant to the conversion of vested RSUs. Upon conversion, the fair value of $496,500 for the vested RSUs was transferred from RSUs reserve to share capital.

* On December 19, 2024, the Company issued 3,355,704 common shares at $2.98 per share for gross proceeds of $10,000,000. In connection with the financing, the Company incurred share issuance costs of $860,833 and issued 167,785 finders' warrants exercisable at $4.09 per common share expiring on December 19, 2029. The fair value of the finders' warrants was determined to be $470,286 which was calculated using the Black-Scholes option pricing model with the following assumptions: volatility of 206%, expected life of 5 years, no dividends, and a risk-free rate of 3.11%.

* On December 24, 2024, the Company issued 3,750,000 common shares pursuant to the conversion of the convertible debt (see Note 7). The carrying value of the convertible debt at the date of conversion was $1,117,189. The equity component of the convertible debt of $427,483 was transferred to share capital upon conversion.

<u>Escrowed shares</u>

On completion of the acquisition of BTQ AG on February 17, 2023, certain principals of the Company entered into a NP 46-201 Escrow Agreement with the NEO Exchange and Computershare Trust Company of Canada, as escrow agent, in respect of 45,250,000 common shares. Under the terms of the Escrow Agreement, 25% of such escrowed securities were released upon closing (February 17, 2023) with subsequent 25% releases occurring 6, 12, and 18 months from closing.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**8. SHARE CAPITAL** (continued)

These escrow shares were released as follows:

---

| | |
|:---|:---|
| &nbsp;&nbsp; Date of automatic timed release | &nbsp;&nbsp; Amount of escrow shares released |
| &nbsp;&nbsp; On the date that the Company's common shares were listed on the NEO, February 17, 2023 | &nbsp;&nbsp; 1/4 of the escrowed shares |
| &nbsp;&nbsp; 6 months after the listing date (August 17, 2023) | &nbsp;&nbsp; 1/4 of the escrowed shares |
| &nbsp;&nbsp; 12 months after the listing date (February 17, 2024) | &nbsp;&nbsp; 1/4 of the escrowed shares |
| &nbsp;&nbsp; 18 months after the listing date (August 17, 2024) | &nbsp;&nbsp; The remainder of the escrowed shares |

---

As at December 31, 2025, the Company has nil (2024 - 20,362,500) common shares held in escrow.

**9. STOCK OPTIONS**

The Company has a stock option plan (the "Plan") for directors, officers, employees, and consultants of the Company. Stock options are exercisable for periods of up to five years, as determined by the Board of Directors of the Company, to purchase common shares of the Company at a price not less than the discounted market price on the date of the grant. The maximum number of shares which may be issuable under the Plan cannot exceed 10% of the total number of issued and outstanding common shares on a non-diluted basis.

The following table summarizes the continuity of the Company's stock options:

---

| | | |
|:---|:---|:---|
|  | Number of<br>stock options | Weighted<br>average<br>exercise<br>price<br>$|
| Outstanding, December 31, 2023 | 7770000 | 0.41 |
| &nbsp;&nbsp;Granted | 1325000 | 0.42 |
| &nbsp;&nbsp;Exercised | (560000) | 0.40 |
| &nbsp;&nbsp;Expired | (740000) | 0.40 |
| &nbsp;&nbsp;Forfeited | (3120000) | 0.42 |
| Outstanding, December 31, 2024 | 4675000 | 0.42 |
| &nbsp;&nbsp;Granted | 150000 | 5.72 |
| &nbsp;&nbsp;Exercised | (1581250) | 0.42 |
| &nbsp;&nbsp;Expired | (725000) | 0.40 |
| &nbsp;&nbsp;Forfeited | (15000) | 0.40 |
| Outstanding, December 31, 2025 | 2503750 | 0.75 |
| Exercisable, December 31, 2025 | 558750 | 1.51 |

---

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**9. STOCK OPTIONS** (continued)

Additional information regarding stock options outstanding as at December 31, 2025, is as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Outstanding | Outstanding | Outstanding | Exercisable | Exercisable |
| Range of<br>exercise prices<br>$| Number of<br>stock options | Weighted<br>average<br>remaining<br>contractual<br>life (years) | Weighted<br>average<br>exercise price<br>$| Number of<br>stock options | Weighted<br>average<br>exercise price<br>$|
| 0.27 | 300000 | 1.9 | 0.27 | 75000 | 0.27 |
| 0.35 | 75000 | 1.8 | 0.35 |  |  |
| 0.40 to 0.45 | 1518750 | 2.2 | 0.41 | 266250 | 0.40 |
| 0.485 to 0.50 | 250000 | 3.2 | 0.49 | 25000 | 0.49 |
| 0.64 to 0.65 | 160000 | 2.0 | 0.64 | 80000 | 0.64 |
| 1.51 | 50000 | 4.0 | 1.51 | 12500 | 1.51 |
| 4.48 | 50000 | 4.1 | 4.48 |  |  |
| 6.34 | 100000 | 1.6 | 6.34 | 100000 | 6.34 |
|  | 2503750 | 2.3 | 0.75 | 558750 | 1.51 |

---

The fair value for stock options granted have been estimated using the Black-Scholes option pricing model assuming no expected dividends or forfeitures and the following weighted average assumptions:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| Risk-free interest rate | 2.77% | 3.17% |
| Expected life (in years) | 3.0 | 4.5 |
| Expected volatility | 210% | 203% |

---

During the year ended December 31, 2025, the Company recognized share-based compensation expense of $982,655 (2024 - $81,002). The weighted average fair value of the stock options granted during the year ended December 31, 2025 was $5.11 (2024 - $0.42) per option. The weighted average fair value of shares at the time of the stock option exercises during the year ended December 31, 2025 was $9.61 (2024 - $1.84) per common share.

**10. SHARE PURCHASE WARRANTS**

The following table summarizes the continuity of share purchase warrants:

---

| | | |
|:---|:---|:---|
|  | Number of<br>warrants | Weighted<br>average<br>exercise<br>price<br>$|
| &nbsp;&nbsp;Balance, December 31, 2023 | 232936 | 0.40 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issued | 167785 | 4.09 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercised | (134105) | 0.40 |
| &nbsp;&nbsp;Balance, December 31, 2024 | 266616 | 2.72 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issued | 138888 | 12.60 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercised | (40437) | 0.40 |
| &nbsp;&nbsp;&nbsp;&nbsp;Expired | (58394) | 0.40 |
| &nbsp;&nbsp;Balance, December 31, 2025 | 306673 | 7.94 |

---

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**10. SHARE PURCHASE WARRANTS** (continued)

As at December 31, 2025, the following share purchase warrants were outstanding and exercisable:

---

| | | |
|:---|:---|:---|
| Number of <br>warrants<br>outstanding | Exercise price<br>$| &nbsp;&nbsp;<br>Expiry date |
| 167785 | &nbsp;&nbsp;&nbsp;&nbsp;4.09 | &nbsp;&nbsp;December 19, 2029 |
| 138888 | 12.60 | &nbsp;&nbsp;July 11, 2030 |
| 306673 |  |  |

---

**11. RESTRICTED SHARE UNITS**

A summary of the changes in restricted share units ("RSUs") is presented below:

---

| | |
|:---|:---|
|  | Number of<br>RSUs |
| Balance, December 31, 2023 | 1**,**985000 |
| &nbsp;&nbsp;Issued | 800000 |
| &nbsp;&nbsp;Settlement | (840000) |
| Balance, December 31, 2024 | 1945000 |
| &nbsp;&nbsp;Issued | 2854800 |
| &nbsp;&nbsp;Settlement | (1390000) |
| Balance, December 31, 2025 | 3409800 |
| Unvested | 2**,**247500 |
| Vested, December 31, 2025 | 1162300 |

---

During the year ended December 31, 2025, 2,854,800 RSUs (2024 - 800,000) were granted. The weighted average grant date fair value for RSUs granted during the year end December 31, 2025 was $6.33 per RSU (2024 - $0.75). During the year ended December 31, 2025, the Company recognized share-based compensation expense (recovery) of $8,865,439 (2024 - $(79,939)) with a corresponding increase (2024 - decrease) to RSU reserve and $5,356,050 (2024 - $496,500) was transferred to share capital upon the settlement of 1,390,000 (2024 - 840,000) RSUs.

**12. PERFORMANCE SHARE UNITS**

A summary of the changes in performance share units ("PSUs") is presented below:

---

| | |
|:---|:---|
|  | Number of<br>PSUs |
| Balance, December 31, 2023 and 2024 |  |
| &nbsp;&nbsp;Issued | 800000 |
| Balance, December 31, 2025 | 800000 |
| Unvested | 800000 |
| Vested, December 31, 2025 | - |

---

During the year ended December 31, 2025, 800,000 PSUs (2024 - nil) were granted. The weighted average grant date fair value for PSUs granted during the year end December 31, 2025 was $9.30 per RSU (2024 - $nil). During the year ended December 31, 2025, the Company recognized share-based compensation expense of $744,158 (2024 - $nil) with a corresponding increase to PSU reserve.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**13. RELATED PARTY TRANSACTIONS**

Key management personnel are persons responsible for planning, directing, and controlling the activities of an entity, and include all officers and directors of the Company. Related party transaction during the years ended December 31, 2025 and 2024 were comprised of the following:

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| Consulting fees |  | 24278 |
| Professional fees | 84000 | 84000 |
| Research and development | 112792 | 249842 |
| Share-based compensation | 109892 | 28905 |
| Wages and benefits | 115459 | 282623 |
|  | 422143 | 669648 |

---

As at December 31, 2025, the Company owed $132,170 (2024 - $124,247) to the CEO of the Company, of which $106,288 (2024 - $97,075) is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company was owed $nil (2024 - $137,369) from the former Chief Operating Officer ("COO") of the Company, which is included in other receivables.

As at December 31, 2025, the Company owed $nil (2024 - $7,350) to a firm where the Chief Financial Officer of the Company is a partner, which is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company owed $26,534 (2024 - $nil) to a director of the Company, which is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company has prepaid research and development expenses of $203,970 (2024 - $nil) to its investment in associate.

**14. SUPPLEMENTAL CASH FLOW INFORMATION**

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| Non-cash investing and financing activities: |  |  |
| &nbsp;&nbsp;Right-of-use asset and corresponding lease obligation |  | 179170 |
| &nbsp;&nbsp;Carrying value of convertible debt recorded in share capital upon conversion |  | 1544672 |
| &nbsp;&nbsp;Equity portion of convertible debt transferred from reserve to share capital upon conversion |  | 427483 |
| &nbsp;&nbsp;Fair value of RSUs converted to shares transferred from RSUs reserve to share capital | 5356050 | 496500 |
| &nbsp;&nbsp;Fair value of stock options exercised transferred from options reserve to share capital | 604231 | 209662 |
| &nbsp;&nbsp;Fair value of warrants exercised transferred from warrants reserve to share capital | 12794 | 38796 |
| &nbsp;&nbsp;Finders' warrants issued pursuant to private placement | 1357406 | 470286 |

---

**15. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Fair Values

<u>Fair value hierarchy</u>

The following provides a description of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**15. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT** (continued)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Fair Values (continued)

* Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;

* Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

* Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Assets and liabilities measured at fair value on a recurring basis were presented on the Company's statement of financial position as at December 31, 2025 and 2024 as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value measurements using | Fair value measurements using | Fair value measurements using |  |
|  | Quoted prices in active<br>markets for identical<br>instruments<br>(Level 1)<br>$| Significant other<br>observable<br>inputs<br>(Level 2)<br>$| Significant<br>unobservable<br>inputs<br>(Level 3)<br>$| <br>Balance,<br>December 31,<br>2025<br>$|
| Investments | 7098893 | - | 1038050 | 8136943 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value measurements using | Fair value measurements using | Fair value measurements using |  |
|  | Quoted prices in active<br>markets for identical<br>instruments<br>(Level 1)<br>$| Significant other<br>observable<br>inputs<br>(Level 2)<br>$| Significant<br>unobservable<br>inputs<br>(Level 3)<br>$| <br>Balance,<br>December 31,<br>2024<br>$|
| Investments | - | - | 77229 | 77229 |

---

The fair values of the Company's other financial instruments, which include cash, short-term investments, other receivables (except GST), accounts payable and accrued liabilities, and due to related parties, approximate their carrying values due to the relatively short-term maturity of these instruments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company limits its exposure to credit loss by placing its cash and cash equivalents and short-term investments with high credit quality financial institutions. The carrying amount of financial assets represents the maximum credit exposure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Foreign Exchange Rate Risk

Foreign currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. The Company is exposed to foreign currency risk to the extent that monetary assets and liabilities are denominated in a foreign currency.

The following tables indicate the impact of foreign currency exchange risk on net working capital as at December 31, 2025 and 2024. The tables below also provides a sensitivity analysis of a 10% strengthening of the foreign currency against functional currencies identified which would have increased (decreased) the Company's net loss by the amounts shown in the tables below. A 10% weakening of the foreign currency against the functional currencies would have had the equal but opposite effect as at December 31, 2025 and 2024.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**15. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT** (continued)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Foreign Exchange Rate Risk (continued)

---

| | | | |
|:---|:---|:---|:---|
| 2025 | TWD | KRW | US$ |
| Cash | 43511 |  | 218798 |
| Investments |  | 7472518740 |  |
| Accounts payable and accrued liabilities | (185400) |  | (782639) |
| Total foreign currency financial assets and liabilities | (141889) | 7472518740 | (563841) |
| Impact of a 10% strengthening or weakening of foreign exchange rate | (14189) | 747251874 | (56384) |

---

---

| | | |
|:---|:---|:---|
| 2024 | TWD | US$ |
| Cash | 82993 | (1249) |
| Other receivables (except GST) |  | 106489 |
| Accounts payable and accrued liabilities | (6337488) | (237069) |
| Total foreign currency financial assets and liabilities | (6254495) | (131829) |
| Impact of a 10% strengthening or weakening of foreign exchange rate | (625450) | (13183) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risk as it does not have any liabilities with variable rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company's objective to managing liquidity risk is to ensure that it has sufficient liquidity available to meet its liabilities when due. The Company relies on raising debt or equity financing in a timely manner.

The following amounts are the contractual maturities of financial liabilities as at December 31, 2025, and 2024:

---

| | | | |
|:---|:---|:---|:---|
| 2025<br>| Total<br>$| Within<br>1 year<br>$| Within<br>2-5 years<br>$|
| Accounts payable and accrued liabilities | 2151111 | 2151111 |  |
| Due to related parties | 25882 | 25882 |  |
| Total | 2176993 | 2176993 | - |
| 2024 | Total<br>$| Within<br>1 year<br>$| Within<br>2-5 years<br>$|
| Accounts payable and accrued liabilities | 1450252 | 1450252 |  |
| Due to related parties | 27172 | 27172 |  |
| Total | 1477424 | 1477424 | - |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Price Risk

The Company is exposed to price risk with respect to investment in public entities. The Company is subject to risks associated with fluctuations in the market price of such investments.

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**16. CAPITAL MANAGEMENT**

The Company manages its capital to maintain its ability to continue as a going concern and to provide returns to shareholders and benefits to other stakeholders. The capital structure of the Company consists of cash and equity comprised of issued share capital, options reserve, warrant reserve, and RSUs reserve.

The Company manages its capital structure and makes adjustments to it in light of economic conditions. The Company, upon approval from its Board of Directors, will balance its overall capital structure through new share issuances or by undertaking other activities as deemed appropriate under the specific circumstances.

The Company is not subject to externally imposed capital requirements and the Company's overall strategy with respect to capital risk management remains unchanged from the year ended December 31, 2024.

**17. SEGMENTED INFORMATION**

The Company has one operating segment, the research and development of computer-based technology related to post-quantum cryptography. The Company's head office is in Canada and operations are in Canada, Taiwan, Australia, and the United States. Geographic information for non-current assets other than financial instruments is as follows:

---

| | | | |
|:---|:---|:---|:---|
| 2025 | Canada<br>$| Australia<br>$| Total<br>$|
| Non-current assets |  |  |  |
| &nbsp;&nbsp;Property and equipment | 4269 | 15038 | 19307 |
| Revenue | 315497 | - | 315497 |

---

---

| | | | |
|:---|:---|:---|:---|
| 2024 | Canada<br>$| Australia<br>$| Total<br>$|
| Non-current assets |  |  |  |
| &nbsp;&nbsp;Deposits | 18902 | 10703 | 29605 |
| Revenue | 666667 | - | 666667 |

---

**18. REVENUE**

During the year ended December 31, 2025, the Company earned license revenue of $315,497 (2024 - $666,667) from a company controlled by the former COO. As at December 31, 2025, the Company has deferred revenue of $nil (2024 - $315,497). A breakdown of the revenue is presented below:

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| &nbsp;&nbsp;<u>Major goods/service lines</u> |  |  |
| &nbsp;&nbsp;Software license | 315497 | 666667 |
| &nbsp;&nbsp;<u>Timing of revenue recognition</u> |  |  |
| &nbsp;&nbsp;Software license transferred over time | 315497 | 666667 |

---

**19. COLLABORATION INCOME**

On May 1, 2023 and November 1, 2023, the Company entered into research and collaboration agreements with a third party. The Company agreed to conduct a research program and was responsible for the engagement of the researchers and contractors while the other party provided funding. The two parties jointly own the rights of the intellectual property resulting from the research program. During the year ended December 31, 2025, the Company recorded collaboration income of $nil (2024 - $108,913).

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**20. GENERAL AND ADMINISTRATIVE EXPENSES**

The following is a breakdown of general and administrative expenses for the years ended December 31, 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| Insurance | 225848 | 62970 |
| IT and communications | 201337 | 119795 |
| Office and miscellaneous | 233544 | 118392 |
| Rent | 333195 | 161293 |
| Travel | 108971 | 232193 |
| VAT |  | 61374 |
|  | 1102895 | 756017 |

---

**21. INCOME TAXES**

The following table reconciles the expected income tax expense (recovery) at the statutory income tax rates to the amounts recognized in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| &nbsp;&nbsp;Net loss before income taxes | (24605873) | (6054418) |
| &nbsp;&nbsp;Statutory tax rate | 27% | 27% |
| &nbsp;&nbsp;Expected income tax recovery | (6643586) | (1634693) |
| &nbsp;&nbsp;Tax effect of: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Permanent differences and other | 257585 | 29503 |
| &nbsp;&nbsp;&nbsp;&nbsp;Difference due to tax rate of foreign jurisdiction | 135038 | 504207 |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange rate impact on temporary differences | 37493 | (53385) |
| &nbsp;&nbsp;&nbsp;&nbsp;Financing fees | (820760) | (232425) |
| &nbsp;&nbsp;&nbsp;&nbsp;True up of prior year difference | (11415) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrecognized deferred income tax assets | 7045645 | 1409111 |
| &nbsp;&nbsp;Income tax provision | - | 22318 |

---

The significant components of deferred income tax assets and liabilities are as follows:

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| &nbsp;&nbsp;Deferred income tax assets (liability) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-capital losses carried forward | 9534795 | 3057355 |
| &nbsp;&nbsp;&nbsp;&nbsp;Intangible asset | 74461 | 74461 |
| &nbsp;&nbsp;&nbsp;&nbsp;Investments | (36886) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Share issuance costs | 806125 | 201034 |
| &nbsp;&nbsp;Total gross deferred income tax assets | 10378495 | 3332850 |
| &nbsp;&nbsp;Total unrecognized deductible deferred income tax assets | (10378495) | (3332850) |
| &nbsp;&nbsp;Net deferred income tax asset | - | - |

---

------

**BTQ TECHNOLOGIES CORP.**<br>Notes to the Consolidated Financial Statements<br>Years Ended December 31, 2025 and 2024<br>(Expressed in Canadian dollars)

**21. INCOME TAXES** (continued)

Deferred income tax assets are only recognized to the extent that the realization of tax benefits is determined to be probable. As at December 31, 2024 and 2023, the Company has not recognized the benefit of the following deductible temporary differences:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Expiry | 2025<br>$| Expiry | 2024<br>$|
| Non-capital losses - Canadian | 2043 to 2045 | 29385675 | 2043 to 2044 | 6425696 |
| Non-capital losses - foreign | No expiry | 11922094 | No expiry | 10574273 |
| Share issuance costs | 2026 to 2029 | 2985649 | 2025 to 2028 | 744570 |
|  |  | 44293418 |  | 17744539 |

---

The Group's current tax provision of $nil (2024 - $22,318) relates to management's assessment of the amount of tax payable on open tax positions where the liabilities remain to be agreed upon with foreign tax authorities. Uncertain tax items for which a provision of $nil (2024 - $22,318) is made, relate principally to the interpretation of tax legislation regarding arrangements entered into by the Group.

**22. COMMITMENTS**

As at December 31, 2025, the Company has the following contractual commitments for research and development and premises lease obligations:

---

| | |
|:---|:---|
|  | US$ |
| &nbsp;&nbsp;2026 | 6407350 |
| &nbsp;&nbsp;2027 | 3824108 |
| &nbsp;&nbsp;2028 | 2984467 |
| &nbsp;&nbsp;2029 | 1620232 |
| &nbsp;&nbsp;2030 | 256214 |

---

**23. SUBSEQUENT EVENTS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subsequent to December 31, 2025, the Company granted 1,582,000 RSUs to employees, consultants, and a director.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) On January 16, 2026, the Company granted 850,000 PSUs to consultants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) On January 16, 2026, the Company granted 600,000 stock options exercisable at $7.85 per common share expiring on January 16, 2031 to a director and consultants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subsequent to December 31, 2025, the Company issued 227,500 common shares for proceeds of $93,125 pursuant to the exercise of stock options of which $50,000 was received as at December 31, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subsequent to December 31, 2025, the Company issued 557,500 common shares pursuant to the settlement of RSUs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Subsequent to December 31, 2025, the Company issued 125,000 common shares pursuant to the settlement of PSUs.

------

## Exhibit 99.3

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

This Management's Discussion and Analysis ("MD&A") of BTQ Technologies Corp. ("BTQ", or the "Company") is for the year ended December 31, 2025 and is dated March 30, 2026. The MD&A should be read in conjunction with the Company's audited consolidated financial statements and related notes for the year ended December 31, 2025. The consolidated financial statements are prepared in accordance with IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and all monetary amounts are expressed in Canadian dollars. The following comments may contain management estimates of anticipated future trends, activities, or results. These are no guarantees of future performance since actual results could change based on other factors and variables beyond management control.

The management of the Company is responsible for the preparation and integrity of the consolidated financial statements, including the maintenance of appropriate information systems, procedures, and internal controls and to ensure that information used internally or disclosed externally, including the consolidated financial statements and MD&A, is complete and reliable. The Company's board of directors (the "Board") follows recommended corporate governance guidelines for public companies to ensure transparency and accountability to shareholders. The Board's audit committee meets with management quarterly to review the financial statements and the MD&A and to discuss other financial, operating, and internal control matters.

Additional information relating to the Company is available under the Company's profile on SEDAR+ at <u>www.sedarplus.ca</u> and on EDGAR at <u>www.sec.gov</u>.

**DESCRIPTION OF BUSINESS AND OVERVIEW**

The principal activity of the Company is the development of computer-based technology related to post-quantum cryptography, particularly as it applies to blockchain and related technologies, and their protection from the emerging security risk of quantum computing. Backed by a broad patent portfolio, BTQ is seeking to deliver a full-stack, neutral-atom quantum computing platform with end-to-end hardware, middleware, and post-quantum security solutions for finance, telecommunications, logistics, life sciences, and defense.

BTQ is listed on Cboe Canada and the Nasdaq Global Market (the "Nasdaq") under the ticker symbol "BTQ". The Company commenced trading on Nasdaq on September 26, 2025.

*Acquisition*

On December 31, 2021 (as amended on April 29, 2022, July 30, 2022, and November 29, 2022), the Company entered into a share exchange agreement with BTQ AG (the "Acquisition"). BTQ AG was incorporated in the Principality of Liechtenstein on March 26, 2021 by a group of experienced post-quantum cryptographers with an interest in addressing the urgent security threat that a large-scale universal quantum computer poses to the Bitcoin network.

In connection with the Acquisition, the Company completed a private placement (the "Offering") of 18,001,250 subscription receipts at a price of $0.40 per subscription receipt, for gross proceeds of $7,200,500, with each subscription receipt automatically converting with no additional consideration into one post-Consolidation Share (each as defined below) concurrent with the closing of the Acquisition.

On February 17, 2023, the Company closed the Acquisition resulting in the issuance of 92,000,000 post-Consolidation Shares to the BTQ AG shareholders. Concurrent with the closing, the Company changed its name from Sonora Gold & Silver Corp. ("SOC") to BTQ Technologies Corp. and completed a consolidation (the "Consolidation") of its common shares on the basis of ten pre-Consolidation shares to one post-Consolidation share (each, a "Share"). Immediately following the Consolidation, and excluding those Shares issued pursuant to the Acquisition or the Offering, the former securityholders of SOC held an aggregate of 8,747,629 Shares and 350,000 stock options in the Company. All Share amounts have been retroactively restated to reflect the Consolidation for all periods presented.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

On closing of the Acquisition, the gross proceeds of $7,200,500 from the Offering were released from escrow and each subscription receipt was converted into one Share. In connection with the Acquisition, the Company issued 2,500,000 Shares with a fair value of $1,000,000 to a finder as a success fee. In connection with the Offering, the Company also paid $93,174 in finders' fees and issued 232,936 finders' warrants exercisable at an exercise price of $0.40 per Share for a period of two years.

*Highlights for the year ended December 31, 2025*

On July 11, 2025, the Company issued 5,555,555 common shares at $7.20 per share for gross proceeds of $39,999,996. In connection with this offering, the Company incurred a finder's fee of $2,800,000 and share issuance costs of $109,589. The Company also issued 138,888 finder's warrants exercisable at $12.60 per common share expiring on July 11, 2030.

On October 27, 2025, the Company entered into a Share Subscription Agreement and a Development Service Agreement with ICTK Co., Ltd. (the "ICTK Agreements"), a technology company located in the Republic of Korea. Under the Share Subscription Agreement, the Company acquired 452,058 common shares of ICTK for KRW 7,180,489,272 (approximately $6.8 million) on December 19, 2025. Under the Development Service Agreement, the Company has engaged ICTK to carry out the development work (the "Services") related to Quantum Computation-In-Memory ("QCIM") IP verification and development of a quantum security chip incorporating QCIM application for US$10,000,000. The amount is to be paid by the Company in instalments based on the Company's acceptance of each relevant milestone. The agreement is limited to the provision of technology and know-how necessary for the performance of the Services with respect to each party's background technology and does not include the use of the deliverables of this agreement for commercial purposes.

On November 7, 2025, the Company entered into an Ordinary Share Subscription Agreement and acquired 217,865 shares of QPerfect SAS ("QPerfect"), a technology company located in Strasbourg, France, for $3,263,521 (€2,000,000) which resulted in a 15.29% interest. Concurrent with the completion of this investment, the Company provided notice to exercise its option to acquire the remaining shares of QPerfect (the "QPerfect Acquisition") which will be paid in cash and common shares of the Company. The closing of the QPerfect Acquisition is subject to France's foreign direct investment approval process.

**DISCUSSION OF OPERATIONS**

*Principal Products*

During fiscal 2025, the Company executed a significant strategic realignment, streamlining its product portfolio around three commercially focused product lines: QCIM, Bitcoin Quantum, and Quantum Stablecoin Settlement Network ("QSSN"). If the QPerfect Acquisition is completed, it will establish the Company's vertically integrated quantum computing capabilities. The Company deprecated earlier-stage research programs to consolidate resources around what it believes to be its highest-value commercial opportunities.

<u>QCIM</u>

QCIM is the Company's flagship hardware product: a quantum-secure compute-in-memory chip designed to implement fast, crypto-agile, energy-efficient post-quantum cryptography directly in silicon. QCIM supports NIST-standardized post-quantum cryptographic algorithms, including ML-KEM and ML-DSA, in a compact, low-power form factor suitable for deployment in constrained environments such as smart cards, IoT endpoints, mobile devices, and hardware security modules. The chip is designed to support both post-quantum and traditional encryption methods, providing cryptographic agility as industry standards continue to evolve. The technology builds upon patents acquired from Radical Semiconductor and their founding team.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

During 2025, the QCIM program advanced significantly from its prior preliminary research phase. In September 2025, Radical Semiconductor co-founders Sean Hackett and Zach Belateche joined BTQ full-time, with Sean Hackett leading silicon product development and Zach Belateche leading hardware security. With these additions, the Company intends to accelerate commercialization of the QCIM program. In October 2025, the Company signed the ICTK Agreements with ICTK, a leading South Korean secure-element manufacturer, to co-develop the QCIM chip. The ICTK Agreements cover joint design, validation, tape-out, certification, and productization, with BTQ making an equity investment in ICTK and ICTK providing in-kind cost-sharing and preferential manufacturing capacity.

As of December 31, 2025, QCIM was in the pre-silicon validation phase, with architecture definition and prototyping underway. Subsequent to year-end 2025, the Company announced a 2026 collaboration with Taiwan's ITRI to validate QCIM in silicon and opened a commercialization hub in New York, New York, staffed with senior engineers to accelerate the path toward production-ready silicon.

The Company targets QCIM for deployment in high-assurance applications including cold and hardware wallets for digital assets, mobile authentication and fintech security, IoT endpoint protection, payment gateway infrastructure, and defense systems. The Company expects to deliver initial hardware to design partners on physical circuit boards for testing during 2026, with industry-specific certifications and broader commercialization to follow.

<u>Bitcoin Quantum</u>

Bitcoin Quantum is a permissionless, quantum-safe fork of Bitcoin that replaces Bitcoin's quantum-vulnerable Elliptic Curve Digital Signature Algorithm ("ECDSA") with Module-Lattice Digital Signature Algorithm ("ML-DSA"), the NIST-standardized post-quantum digital signature scheme published as Federal Information Processing Standard 204 in August 2024. Bitcoin Quantum is built on Bitcoin Core's proven codebase and incorporates a 64 MiB block size limit to accommodate post-quantum signatures, which are approximately 70 times larger than their classical counterparts, as well as a Post-Quantum Key infrastructure that enables the integration of future quantum-resistant signature algorithms as they become available.

Bitcoin Quantum addresses an increasingly urgent security concern: approximately 6.26 million BTC, representing approximately $750 billion in value, currently reside in addresses with exposed public keys that are vulnerable to future quantum attack. The product provides a production-grade proving ground for the cryptocurrency ecosystem to test quantum-resistant transactions and infrastructure without risking the Bitcoin mainnet, while also serving as a standalone quantum-safe network.

In October 2025, the Company announced the first successful demonstration of Bitcoin Quantum Core Release 0.2, completing the full flow of quantum-safe wallet creation, transaction signing and verification, and mining. The Company also established the BTQ Foundation, co-chaired by BTQ, to coordinate industry-wide quantum defense efforts including open-source development, consensus building, standards setting, and migration frameworks. In the fourth quarter of 2025, the Company completed security auditing and preparation for testnet launch.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

The Company launched the Bitcoin Quantum testnet, a public, permissionless network with a block explorer and mining pool, on January 12, 2026, which coincided with the 17th anniversary of Bitcoin's genesis block. Leading digital asset research firm Delphi Digital published research characterizing Bitcoin Quantum as a "quantum canary" network, a critical testbed for the industry's quantum transition.

The Company is building multiple expected revenue streams around Bitcoin Quantum. The Company anticipates additional revenue opportunities through security-as-a-service models, premium settlement layers, and quantum certification services as the network matures.

Bitcoin Quantum represents the commercial evolution of the Company's prior quantum proof-of-work research conducted in collaboration with Macquarie University, which explored the application of quantum computing to blockchain proof-of-work mechanisms. The Company's published roadmap targets enterprise pilot programs with institutional digital asset managers in Q1 2026, expects mainnet launch with migration tools in Q2 2026, and expects integration with exchanges and custody providers during 2026-2027.

<u>QSSN</u>

QSSN is a quantum-secure validation and wallet infrastructure product designed to enable banks, payment providers, and digital asset platforms to issue and manage stablecoins with built-in protection against quantum-era cybersecurity threats. The product provides quantum-safe smart account wallets for EVM-compatible blockchain networks, using ML-DSA post-quantum cryptography within the ERC-4337 account abstraction standard. This approach delivers familiar wallet user experience with post-quantum security, requires no modifications to underlying blockchain protocols, and protects institutional customers against "harvest now, decrypt later" attacks in which adversaries capture encrypted data today for future quantum decryption.

QSSN operates as a specialized validation service layer rather than a new blockchain. Validator nodes generate quantum-secure attestations using dual-signature mechanisms that combine classical ECDSA signatures with post-quantum ML-DSA signatures, ensuring backward compatibility with existing systems while providing quantum resistance. Economic coordination, including fee collection, distribution, and staking, is managed through smart contracts deployed on established platforms, leveraging battle-tested infrastructure rather than building new financial primitives. The system is designed to support institutional-scale throughput and maintains cryptographic proofs of all validations for audit and regulatory compliance purposes.

The Company unveiled QSSN in June 2025 and subsequently commenced proof-of-concept deployments with Danal and Finger Inc. Group in South Korea. The Company intends to develop revenue opportunities from QSSN through validator node licensing fees, transaction-based validation fees with flexible pricing models supporting both crypto-native and fiat-linked pricing, and staking mechanisms that enable token holders to participate in network security.

<u>QPerfect</u>

On November 7, 2025, the Company entered into an Ordinary Share Subscription Agreement and acquired 217,865 shares of QPerfect SAS ("QPerfect"), a technology company located in Strasbourg, France, for $3,263,521 (€2,000,000) which resulted in a 15.29% interest. Concurrent with the completion of this investment, the Company provided notice to exercise its option to acquire the remaining shares of QPerfect (the "QPerfect Acquisition") which will be paid in cash and common shares of the Company. The closing of the QPerfect Acquisition is subject to certain conditions, including France's foreign direct investment approval process.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

QPerfect's MIMIQ™ emulator is capable of simulating circuits of up to thousands of qubits. Subsequent to December 31, 2025, MIMIQ was integrated into SDT's QUREKA™ platform for commercial cloud-based quantum emulation. If completed, the QPerfect Acquisition is expected to be a key component of the Company's goal to provide vertically integrated quantum computing capabilities including quantum error correction research applicable to QCIM and have a European R&D base at the European Center for Quantum Science ("CESQ) in Strasbourg.

If the QPerfect Aacquisition is completed, it is expected to provide BTQ with vertically integrated quantum computing capabilities that complement and strengthen the Company's hardware and software technologies, including quantum error correction research applicable to QCIM development, quantum sensing capabilities relevant to precision navigation and timing applications, and a European research and development base within one of Europe's leading quantum science institutions.

**Trends**

<u>Quantum Computing</u>

According to research published by McKinsey & Company, the global quantum technology market could reach more than US$100 billion by 2040, with the majority of value expected to be generated by quantum computing applications rather than quantum sensing or quantum communications. Quantum computing has the potential to enable breakthroughs across a range of industries including materials science, pharmaceuticals, logistics optimization, and cybersecurity.

A growing area within the broader quantum technology ecosystem is quantum-resilient or quantum-secure cybersecurity. As quantum computing systems scale in capability, they are expected to pose a potential risk to widely used public-key cryptographic systems, including RSA and elliptic curve cryptography, which underpin much of today's secure communications infrastructure. If sufficiently powerful quantum computers are realized, certain currently deployed cryptographic systems could become vulnerable to quantum algorithms such as Shor's Algorithm.

While large-scale, fault-tolerant quantum computers have not yet been realized, the pace of development continues to accelerate. Several companies and research institutions have published roadmaps outlining the development of larger and more capable quantum processors. For example, IBM has announced multi-year plans to scale quantum processors and quantum computing systems, while other technology companies and startups are pursuing different hardware architectures including trapped-ion, superconducting, and photonic quantum systems.

In parallel with private sector activity, governments around the world continue to increase funding for quantum technologies as part of national technology and security strategies. Countries including China, the European Union, the United States, Japan, the United Kingdom, and Canada have announced multi-billion-dollar national initiatives supporting quantum research, infrastructure, and commercialization.

Investment in quantum technology companies has also increased significantly in recent years, reflecting growing interest from venture capital, corporate investors, and government programs. As the ecosystem matures, industry participants are focusing not only on hardware development but also on software, cryptography, and security applications designed to support a future quantum-enabled computing environment.

<u>Post-Quantum Cryptography</u>

One of the most significant developments within the quantum security sector is the advancement of post-quantum cryptography ("PQC"). PQC refers to cryptographic algorithms that are designed to remain secure against both classical and quantum computing attacks.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

A major driver of development in this area is the work of the National Institute of Standards and Technology ("NIST"), an agency of the U.S. Department of Commerce responsible for developing technology standards used globally across government and industry. NIST initiated a multi-year process in 2016 to evaluate and standardize quantum-resistant public-key cryptographic algorithms.

In 2022, NIST announced the first set of algorithms selected for standardization from its post-quantum cryptography competition, marking a significant milestone for the industry. Additional standards and implementation guidance have continued to progress, and organizations across sectors have begun planning migration strategies toward quantum-resistant cryptographic systems.

A key challenge associated with many PQC algorithms is the relatively large key sizes and signature sizes compared to classical cryptographic systems. These characteristics can create implementation challenges for certain applications, particularly those involving constrained computing environments, large distributed systems, or high-throughput transaction networks.

For example, distributed ledger technologies and blockchain networks rely on cryptographic signatures for transaction validation and consensus mechanisms. In some implementations, the larger signatures associated with certain PQC algorithms could significantly increase data storage requirements or network bandwidth usage if adopted directly without additional optimization.

As a result, research continues into cryptographic techniques that may enable quantum-resistant security while maintaining scalability and efficiency across modern digital infrastructure.

<u>Competition and Market Participants</u>

The quantum technology ecosystem includes a range of participants across hardware, software, and cybersecurity domains.

Several publicly traded companies are focused primarily on developing commercial quantum computing hardware platforms. These include companies such as D-Wave Quantum Inc., IonQ Inc., Rigetti Computing, Inc., and Arqit Quantum Inc.. These companies generally focus on the development of scalable quantum computing systems and related cloud-based quantum services rather than specifically on post-quantum cryptography or blockchain applications.

The post-quantum cybersecurity segment has also seen the emergence of several specialized companies and research organizations developing cryptographic solutions designed to address quantum computing risks.

Examples include PQShield, which develops quantum-secure cryptographic solutions and contributes to post-quantum cryptographic standardization efforts, and ISARA Corporation, which focuses on cryptographic risk management and quantum-safe security solutions for enterprises and government organizations.

In addition, large technology companies are exploring quantum-resilient security approaches within broader enterprise technology platforms. For example, IBM provides enterprise blockchain and security solutions designed to support applications across industries such as supply chains, financial services, healthcare, and government.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

Another notable participant in the broader quantum technology ecosystem is SandboxAQ, an enterprise software company that develops solutions combining artificial intelligence and quantum-related technologies for applications including cybersecurity, materials science, and financial modeling.

Given the breadth of approaches being pursued across the industry-including hardware development, cryptographic research, and enterprise software solutions-the market for quantum-resilient security technologies is expected to include a variety of specialized participants, potential collaborators, and emerging standards over time.

**SELECTED ANNUAL INFORMATION**

The following table presents selected audited financial information for the three most recent fiscal year ends.

---

| | | | |
|:---|:---|:---|:---|
|  | 2025<br>$| 2024<br>$| 2023<br>$|
| Revenues | 315497 | 666667 |  |
| Net loss | (24605873) | (6076736) | (15403295) |
| Net loss per share, basic and diluted | (0.18) | (0.05) | (0.13) |
| Total assets | 33786999 | 9731478 | 4035989 |
| Total non-current financial liabilities | - | - | - |

---

The net loss for the year ended December 31, 2025 includes share-based compensation expense of $10,592,252 (2024 - $1,063; 2023 - $3,920,656).

The net loss for the year ended December 31, 2025 has otherwise increased significantly compared to the year ended December 31, 2024 due to the expansion of research and development activities, business development, and expenses incurred relating to listing on Nasdaq.

The net loss for the year ended December 31, 2023 includes $5,059,669 in listing and transaction costs as a result of the acquisition of BTQ AG and share-based compensation expense of $3,920,656.

**RESULTS OF OPERATIONS**

**For the year ended December 31, 2025**

The net loss for the year ended December 31, 2025 was $24,605,873 (2024: $6,076,736). The main categories are listed below:

<u>Revenue of $315,497 (2024: $666,667)</u>

The Company's one year licensing agreement with ZKP Corp., a company controlled by the former COO of the Company ("ZKP", ended in May 2025.

<u>Business development, marketing, and promotion of $3,097,676 (2024: $779,967)</u>

The increase is due to new marketing agreements during the year. The Company spent more marketing and promotion during the year to increase awareness on the Company's Nasdaq listing.

<u>Consulting fees of $869,128 (2024: $216,352)</u>

The increase is due to new consulting and advisory agreements as the Company increase in operations during the year.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

<u>General and administrative of $1,102,895 (2024: $756,017)</u>

The increase is mainly due to the increase in operations in the current year.

<u>Professional fees of $2,927,556 (2024: $1,089,994)</u>

The increase is mainly due to higher legal and auditor fees incurred relating to the base shelf prospectus, U.S. Securities and Exchange Commission (the "SEC") filings, and Nasdaq listing. The Company also incurred fees for internal control advisory services during the year.

<u>Research and development of $5,601,755 (2024: $2,732,496)</u>

The increase was due to the Company increasing its research and development activities.

<u>Share-based compensation of $10,592,252 (2024: $1,063)</u>

During the year ended December 31, 2025, the Company granted 150,000 (2024: 1,325,000) stock options, 2,854,800 (2024: 800,000) restricted stock units, and 800,000 (2024: nil) performance share units.

<u>Transfer agent, regulatory, and listing fees of $958,417 (2024: $139,377)</u>

The increase is mainly due to the base shelf prospectus filing, SEC filings, and Nasdaq listing.

<u>Wages and benefits of $210,891 (2024: $575,532)</u>

The decrease is mainly due to the termination of employees and closure of Taiwan branch office in 2024.

<u>Unrealized gain on investment of $322,087 (2024: $nil)</u>

The increase is due to the increase in our investment in ICTK.

**FOURTH QUARTER**

**For the three months ended December 31, 2025**

The net loss for the three months ended December 31, 2025 was $11,823,627 (2024: $1,517,826). The main categories are listed below:

<u>Revenue of $nil (2024: $250,000)</u>

The Company's licensing agreement with ZKP ended in Q2 2025.

<u>Business development, marketing, and promotion of $1,569,413 (2024: $206,689)</u>

The Company spent more marketing and promotion during the period to increase awareness of the Company's Nasdaq listing.

<u>General and administrative of $374,701 (2024: $156,938)</u>

The increase is mainly due to the increase in operations in the current period compared to the same period prior year.

<u>Professional fees of $1,074,719 (2024: $235,888)</u>

The increase in professional fees is mainly due to an increase in legal fees incurred for the QPerfect investment and for due diligence work relating to a contemplated financing.

<u>Research and development of $3,721,800 (2024: $696,214)</u>

The Company expanded its research and development activities including entering into a significant development service agreement with ICTK during the period..

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

<u>Share-based compensation of $4,941,347 (2024: $191,994)</u>

The increase in share-based compensation was mainly due to RSUs and PSUs granted during the current period. The Company granted 892,500 (2024: 800,000) restricted stock units and 800,000 (2024: nil) performance stock units during the period.

<u>Wages and benefits of $22,069 (2024: $73,587)</u>

The slight decrease was primarily attributable to the resignation of the COO, who has since transitioned to a consulting role.

<u>Unrealized gain on investment of $322,087 (2024: $nil)</u>

The increase is due to the increase in our investment in ICTK.

**USE OF AVAILABLE FUNDS**

In connection with the brokered LIFE offering which closed on December 19, 2024, below is a reconciliation of the expected use of available funds against the actual use of such funds as of December 31, 2025:

---

| | | |
|:---|:---|:---|
| **Item** | &nbsp;&nbsp;<br>Use of Available Funds<br>$| &nbsp;&nbsp;Actual Use of Available<br>Proceeds as at<br>December 31, 2025<br>$|
| QCIM | &nbsp;&nbsp;3810000 | &nbsp;&nbsp;712579 |
| General and administrative | &nbsp;&nbsp;1400000 | &nbsp;&nbsp;5696907 |
| Ongoing operations other R&D | &nbsp;&nbsp;1500000 | &nbsp;&nbsp;1799678 |
| Working capital | &nbsp;&nbsp;1499164 | &nbsp;&nbsp;- |
| **Total** | &nbsp;&nbsp;**8209164** | &nbsp;&nbsp;**8209164** |

---

In connection with the Prospectus Supplement offering which closed on July 11, 2025, below is a reconciliation of the expected use of available funds against the actual use of such funds as of December 31, 2025:

---

| | | |
|:---|:---|:---|
| **Item** | &nbsp;&nbsp;<br>Use of Available Funds<br>$| &nbsp;&nbsp;Actual Use of Available<br>Proceeds as at<br>December 31, 2025<br>$|
| QCIM | &nbsp;&nbsp;20000000 | &nbsp;&nbsp;373756 |
| QPerfect investment | &nbsp;&nbsp;3210000 | &nbsp;&nbsp;3263521 |
| Selective strategic investments / IP acquisitions | &nbsp;&nbsp;3750000 | &nbsp;&nbsp;7737627 |
| General and administrative | &nbsp;&nbsp;3000000 | &nbsp;&nbsp;3719585 |
| Ongoing operations other R&D | &nbsp;&nbsp;6600000 | &nbsp;&nbsp;2967257 |
| Working capital | &nbsp;&nbsp;230456 | &nbsp;&nbsp;- |
| **Total** | &nbsp;&nbsp;**36790456** | &nbsp;&nbsp;**18061746** |

---

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

**SUMMARY OF QUARTERLY RESULTS**

The following table sets out financial information for the past eight quarters:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended |
|  | December 31,<br>2025<br>$| September 30,<br>2025<br>$| June 30,<br>2025<br>$| March 31,<br>2025<br>$|
| Total revenues |  |  | 65497 | 250000 |
| Net loss | (11823110) | (9024165) | (1946618) | (1811980) |
| Net loss per share, basic and diluted | (0.09) | (0.07) | (0.01) | (0.01) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended |
|  | December 31,<br>2024<br>$| September 30,<br>2024<br>$| June 30,<br>2024<br>$| March 31,<br>2024<br>$|
| Total revenues | 250000 | 326094 | 90573 |  |
| Net loss | (1517826) | (1029346) | (1695192) | (1834372) |
| Net loss per share, basic and diluted | (0.01) | (0.01) | (0.01) | (0.02) |

---

The net loss for the quarter ended December 31, 2025 includes share-based compensation of $4,941,347 related to the issuance of stock options, restricted stock units and performance stock units.

The net loss for the quarter ended September 30, 2025 includes share-based compensation of $4,505,665 related to the issuance of stock options and restricted share units.

Other than higher share-based compensation expense for Q3 and Q4 2025 as outlined above, the increase in net loss for these quarters was due to the expansion of research and development activities, business development, and expenses incurred relating to listing on Nasdaq and due diligence work for a contemplated financing.

**LIQUIDITY AND CAPITAL RESOURCES** 

As at December 31, 2025, the Company had cash of $20,939,224 and working capital of $20,239,094 compared to cash of $9,336,892 and working capital of $7,831,723 as at December 31, 2024.

The Company's operations used cash of $15,008,504 (2024: $4,695,569) during the year ended December 31, 2025. The Company's investing activities used cash of $11,074,234 (2024: provided $330,076). The cash requirements during the year ended December 31, 2025 were funded from the net proceeds from share issuances of $37,685,070 (2024: $9,416,808) and $nil (2024: $1,500,000) from the issuance of convertible debt.

The Company's aggregate operating, investing, and financing activities during the year ended December 31, 2025 resulted in an increase in its cash balance of $11,602,332 (2024: $6,474,869).

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Contractual Obligations | Payments Due by Period | Payments Due by Period | Payments Due by Period | Payments Due by Period | Payments Due by Period |
| Contractual Obligations | Total<br>$| Less than 1<br>Year<br>$| 1-3 Years<br>$| 4-5 Years<br>$| After 5 Years<br>$|
| Lease obligations | 1275098 | 294151 | 475981 | 504966 |  |
| Research and development obligations | 13817273 | 6113199 | 6332594 | 1371480 |  |
| Total contractual obligations | 15092371 | 6407350 | 6808575 | 1876446 | - |

---

The Company's accounts payable and accrued liabilities are due in the short term. While the Company has been successful in obtaining the necessary financing through the issuance of common shares and convertible loans in the past, there is no assurance it will be able to raise funds in this manner in the future and there remain material uncertainties that may cast significant doubt as to the Company's ability to continue as a going concern.

The directors regularly review cash flow forecasts to determine whether the Company has sufficient cash reserves to meet future working capital requirements and discretionary business development opportunities.

The consolidated financial statements have been prepared on the going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. During the year ended December 31, 2025, the Company has a net loss and negative cash flow from operations. As at December 31, 2025, the Company has an accumulated deficit of $65,250,962. The Company's ability to continue its operations and to realize its assets at their carrying values is dependent upon obtaining additional financing and generating revenues sufficient to cover its operating costs. Management is of the opinion that sufficient working capital will be obtained from external financing to meet the Company's liabilities and commitments as they become due, although there is a risk that additional financing will not be available on a timely basis or on terms acceptable to the Company. These factors indicate a material uncertainty that may cast significant doubt on the ability of the Company to continue as a going concern. These consolidated financial statements do not reflect any adjustments that may be necessary if the Company is unable to continue as a going concern. Such adjustments could be material.

**OFF-BALANCE SHEET ARRANGEMENTS**

There are no off-balance sheet arrangements to which the Company is committed.

**RELATED PARTY TRANSACTIONS**

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

Key management personnel are persons responsible for planning, directing, and controlling the activities of an entity, and include all officers and directors of the Company. Related party transactions during the years ended December 31, 2025 and 2024 were comprised of the following:

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

---

| | | |
|:---|:---|:---|
|  | 2025<br>$| 2024<br>$|
| &nbsp;&nbsp;License revenue earned from ZKP., a company controlled by Nicolas Roussy Newton (former COO) | 315497 | 666667 |
| &nbsp;&nbsp;Consulting fees incurred to Ming-Yang Chih, former Chief Strategic Officer |  | 24278 |
| &nbsp;&nbsp;Professional fees incurred to Saturna Group Chartered Professional Accountants LLP, a firm where the CFO, Lonny Wong, is a partner | 84000 | 84000 |
| &nbsp;&nbsp;Research and development incurred to Christoper Tam (Director), Po-Chun Ko (former Chief Technology Officer), Chen-Mou Cheng (former Chief Cryptographer), Chelpis Quantum Tech Co. (company owned by Ming-Yang Chih), and QPerfect (Associate) | 112792 | 249842 |
| &nbsp;&nbsp;Share-based compensation | 109892 | 28905 |
| &nbsp;&nbsp;Wages and benefits incurred to Nicolas Roussy Newton (former COO) and Peter Lavelle (former Chief Legal Officer) | 115459 | 282623 |

---

Related party balances as at December 31, 2025 and 2024 are as follows:

As at December 31, 2025, the Company owed $132,170 (2024 - $124,247) for expenses paid on behalf of the Company to Olivier Roussy Newton, the CEO of the Company, of which $106,288 (2024 - $97,075) is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company was owed $nil (2024 - $137,369) from Nicolas Roussy Newton, the former Chief Operating Officer ("COO") of the Company, which is included in other receivables.

As at December 31, 2025, the Company owed $nil (2024 - $7,350) to Saturna Group Chartered Professional Accountants LLP where Lonny Wong, the Chief Financial Officer of the Company is a partner, which is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company owed $26,534 (2024 - $nil) to Christopher Tam, a director of the Company, which is included in accounts payable and accrued liabilities.

As at December 31, 2025, the Company has prepaid research and development expenses of $203,970 (2024 - $nil) to QPerfect, its investment in associate.

As at December 31, 2025, the Company has deferred revenue of $nil (2024 - $315,497) for ZKP., a company controlled by Nicolas Roussy Newton, the former COO of the Company. The license agreement relates to certain non-core technology of the Company that was not of a near-term focus for development, and the licensing of such technology to ZKP provided the Company with near-term revenue stream and enabled ZKP to access certain U.S. focused funding sources for the development of a related product.

**RECENT ACCOUNTING PRONOUNCEMENTS**

A number of new standards, and amendments to standards and interpretations, are not yet effective for the year ended December 31, 2025, and have not been early adopted in preparing the consolidated financial statements.

*IFRS 18 Presentation and Disclosure in Financial Statements*

In April 2024, the IASB issued IFRS 18 - Presentation and Disclosure in Financial Statements ("IFRS 18") which will replace IAS 1, Presentation of Financial Statements. The key new concepts introduced in IFRS 18 relate to the structure of the consolidated statement of earnings (loss), required disclosures in the consolidated financial statements for certain earnings or loss performance measures that are reported outside an entity's consolidated financial statements and enhanced principles on aggregation and disaggregation which apply to the primary consolidated financial statements and notes in general. IFRS 18 will apply for reporting periods beginning on or after January 1, 2027, and also applies to comparative information. The Company is still in the process of assessing the impact of this standard on its consolidated financial statements.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

*Amendments to the Classification and Measurement of Financial Instruments ("Amendments to IFRS 9 and IFRS 7")*

In May 2024, the IASB issued Amendments to IFRS 9 and IFRS 7 which clarify the date of recognition and derecognition of some financial assets and liabilities with a new exception for some financial liabilities settled through an electronic cash transfer system, clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest criterion, add new disclosure requirements for certain instruments with contractual terms that can change cash flows such as instruments with features linked to the achievement of environmental, social and governance targets; and update the disclosures for equity instruments designated at FVOCI. Amendments to IFRS 9 and IFRS 7 are effective for periods beginning on or after January 1, 2026, with early adoption permitted. The Company is still in the process of assessing the impact of this standard on its consolidated financial statements.

**CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS**

<u>Use of estimates and judgments</u>

The preparation of consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

<u>Research and development costs</u>

Research costs are recognized as an expense when incurred but development costs may be capitalized as intangible assets if certain conditions are met as described in IAS 38 *Intangible Assets*. Management has determined that development costs do not meet the conditions for capitalization under IAS 38 and all research and development costs have been expensed.

<u>Fair values of stock options</u>

Fair values of stock options are determined using the Black-Scholes option pricing model. Estimating fair value requires determining the most appropriate valuation model for a grant of equity instruments, which is dependent on the terms and conditions of the grant. Option-pricing models require the use of highly subjective estimates and assumptions including the expected stock price volatility. Changes in the underlying assumptions can materially affect the fair value estimates and, therefore, existing models do not necessarily provide reliable measurement of the fair value of the Company's stock options and performance warrants.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

<u>*Deferred income taxes*</u>

The determination of income tax expense and the composition of deferred income tax assets and liabilities involves judgment and estimates as to the future taxable earnings, expected timing of reversals of deferred income tax assets and liabilities, and interpretations of tax laws. The Company is subject to assessments by tax authorities who may interpret the tax law differently. Changes in these interpretations, judgments, and estimates may materially affect the final amount of current and deferred income tax provisions, deferred income tax assets and liabilities, and results of operations.

<u>*Going concern presentation*</u>

The consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The assessment of the Company's ability to source future operations and continue as a going concern involves judgement. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. If the going concern assumption is not appropriate for the financial statements, then adjustments would be necessary in the carrying value of the assets and liabilities, the reported revenue and the expenses and the statement of financial position classifications used.

<u>*Assessment of significant influence over an investment*</u>

Where the Company holds less than 20% of voting rights in an investment, but the Company has the power to exercise significant influence, such an investment is treated as an associate. The determination of whether the Company has significant influence over an investee requires the application of significant judgment. In making this assessment, management considers all relevant facts and circumstances, including ownership interest, governance arrangements, contractual rights, and the Company's ability to participate in financial and operating policy decisions.

<u>*Carrying value of investment in associate*</u>

The Company reviews and assesses the carrying amount of investment in associates for indicators of impairment when facts or circumstances suggest that the carrying amount is not recoverable. Determination of carrying amount is subject to estimates and assumptions about the underlying data. Changes to these estimates may affect value of investment and the impairment recognized.

<u>*Impairment of non-current assets*</u>

The Company evaluates the recoverability of non-current assets, including property and equipment, right of use assets, and definite life intangible assets, whether events or changes in circumstances indicate that the carrying value of the asset, or asset group, may not be recoverable. When the Company determines that the carrying value of the long-lived asset may not be recoverable based upon the existence of one or more of the indicators, the assets are assessed for impairment based on the estimate of future discounted cash flow. If the carrying value of an asset exceeds its estimated recoverable amount, an impairment loss is recorded for the excess of the asset's carrying value over its recoverable amount. Management judgement is required in the determination of indicators of impairment.

<u>*Convertible debt*</u>

Convertible debt are financial instruments which contain a separate financial liability and equity instrument. The identification of such components embedded within a convertible debenture requires significant judgement given that it is based on the interpretation of the substance of the contractual arrangement. The individual fair values attributed to the different components of a financing transaction, and/or derivative financial instruments, are determined using valuation techniques. The Company uses judgement to select the methods used to make certain assumptions and in performing the fair value calculations in order to determine the values attributed to each component of a transaction at the time of their issuance. These valuation estimates could be significantly different because of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an active market.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

**FINANCIAL INSTRUMENTS AND RISK MANAGEMENT**

**Fair Values**

The following provides a description of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Assets and liabilities measured at fair value on a recurring basis were presented on the Company's statement of financial position as at December 31, 2025 and 2024 as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value measurements using | Fair value measurements using | Fair value measurements using |  |
|  | Quoted prices in<br>active markets<br>for identical<br>instruments<br>(Level 1)<br>$| Significant other<br>observable<br>inputs<br>(Level 2)<br>$| Significant<br>unobservable<br>inputs<br>(Level 3)<br>$| <br>Balance,<br>December 31,<br>2025<br>$|
| Investments | 7098893 | - | 1038050 | 8136943 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value measurements using | Fair value measurements using | Fair value measurements using |  |
|  | Quoted prices in<br>active markets<br>for identical<br>instruments<br>(Level 1)<br>$| Significant other<br>observable<br>inputs<br>(Level 2)<br>$| Significant<br>unobservable<br>inputs<br>(Level 3)<br>$| <br>Balance,<br>December 31,<br>2025<br>$|
| Investments | - | - | 77229 | 77229 |

---

The fair values of the Company's other financial instruments, which include cash, short-term investments, other receivables (except GST), and accounts payable and accrued liabilities, and due to related parties, approximate their carrying values due to the relatively short-term maturity of these instruments.

------

![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

**Credit Risk**

Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash and short-term investments. The Company limits its exposure to credit loss by placing its cash and short-term investments with high credit quality financial institutions. The carrying amount of financial assets represents the maximum credit exposure.

**Foreign Exchange Rate Risk**

Foreign currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. The Company is exposed to foreign currency risk to the extent that monetary assets and liabilities are denominated in a foreign currency.

The following table indicates the impact of foreign currency exchange risk on net working capital as at December 31, 2025 and 2024. The table below also provides a sensitivity analysis of a 10% strengthening of the foreign currency against functional currencies identified which would have increased (decreased) the Company's net loss by the amounts shown in the table below. A 10% weakening of the foreign currency against the functional currencies would have had the equal but opposite effect as at December 31, 2025 and 2024.

---

| | | | |
|:---|:---|:---|:---|
| 2025 | TWD | KRW | US$ |
| Cash | 43511 |  | 218798 |
| Investments |  | 7180489272 |  |
| Accounts payable and accrued liabilities | (185400) |  | (782639) |
| Total foreign currency financial assets and liabilities | (141889) | 7180489272 | (563841) |
| Impact of a 10% strengthening or weakening of foreign exchange rate | (14189) | 718048927 | (56384) |

---

---

| | | |
|:---|:---|:---|
| 2024 | TWD | US$ |
| Cash | 82993 | (1249) |
| Other receivables (except GST) |  | 106489 |
| Accounts payable and accrued liabilities | (6337488) | (237069) |
| Total foreign currency financial assets and liabilities | (6254495) | (131829) |
| Impact of a 10% strengthening or weakening of foreign exchange rate | (625450) | (13183) |

---

**Interest Rate Risk**

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risk as it does not have any liabilities with variable rates.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

**Liquidity Risk**

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company's objective to managing liquidity risk is to ensure that it has sufficient liquidity available to meet its liabilities when due. The Company relies on raising debt or equity financing in a timely manner. Refer to going concern disclosure under Liquidity and Capital Resources.

The following amounts are the contractual maturities of financial liabilities as at December 31, 2025 and 2024:

---

| | | | |
|:---|:---|:---|:---|
| 2025<br>| Total<br>$| Within<br>1 year<br>$| Within<br>2-5 years<br>$|
| Accounts payable and accrued liabilities | 2151111 | 2151111 |  |
| Due to related parties | 25882 | 25882 |  |
| Total | 2176993 | 2176993 | - |

---

---

| | | | |
|:---|:---|:---|:---|
| 2024<br>| Total<br>$| Within<br>1 year<br>$| Within<br>2-5 years<br>$|
| Accounts payable and accrued liabilities | 1450252 | 1450252 |  |
| Due to related parties | 27172 | 27172 |  |
| Total | 1477424 | 1477424 | - |

---

**DISCLOSURE OF OUTSTANDING SHARE DATA**

The authorized capital of the Company consists of an unlimited number of common shares without par value.

As of the date of this report, the Company had 141,310,930 common shares issued and outstanding, 306,673 share purchase warrants outstanding, 2,876,250 stock options outstanding, 4,434,300 RSUs and 1,525,000 PSUs outstanding.

**DISCLOSURE CONTROLS AND PROCEDURES** 

In accordance with National Instrument 52-109, Certification of Disclosure in Issuer's Annual and Interim Filings, management is responsible for the establishment and maintenance of disclosure controls and procedures ("DCP") and internal control over financial reporting ("ICFR"). The CEO and the CFO have designed, or caused to be designed under their supervision, the Company's DCP to provide reasonable assurance that material information relating to the Company and its consolidated subsidiaries has been recorded, processed, summarized and disclosed in a timely manner in accordance with regulatory requirements and good business practices and that the Company's DCP will enable the Company to meet its ongoing disclosure requirements.

The CEO and CFO have evaluated the effectiveness of the Company's DCP and have concluded that based on this evaluation, our DCP is effective.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

**INTERNAL CONTROL OVER FINANCIAL REPORTING**

The CEO and the CFO have designed, or caused to be designed under their supervision, the Company's ICFR in order to provide reasonable assurance regarding the reliability of the Company's financial reporting and the preparation of financial statements for external purposes in accordance with IFRS.

A material weakness is a control deficiency, or combination of control deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement in the annual or interim financial statements will not be prevented or detected on a timely basis.

The CEO and CFO conducted an evaluation the effectiveness of the Company's ICFR as at December 31, 2025 based on *Internal Control-Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission for the Company as a whole. Based on this evaluation, management concluded that no material weaknesses existed as at December 31, 2025.

**LIMITATION OF CONTROLS AND PROCEDURES**

The Company's management, including its CEO and CFO, believe that any DCP and ICFR, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, they cannot provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been prevented or detected. These inherent limitations include the reality that judgments in decision making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by unauthorized override of the controls. The design of any control system is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any control system will succeed in achieving its stated goals under all potential future conditions. Accordingly, because of the inherent limitations in a cost effective, control system, misstatements due to error or fraud may occur and not be detected.

**CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING**

There have been no changes to our ICFR for the fiscal year ended December 31, 2025, that could have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**RISK FACTORS**

The following is a summary of certain risk factors relating to the business. The risks presented below should not be considered exhaustive and may not be all of that the Company may face.

***General Risks***

*Market risk for securities* 

There can be no assurance that an active trading market for the Company's shares will be sustained. The market price for the Company's Shares may be subject to wide fluctuations. Factors such as government regulation, price fluctuations, share price movements of peer companies and competitors, as well as overall market movements, may have a significant impact on the market price of the Company's securities. The stock market has from time to time experienced extreme price and volume fluctuations, which have often been unrelated to the operating performance of any particular company. Market forces may render it difficult or impossible for the Company to secure purchasers to purchase its securities at a price which will not lead to severe dilution to existing shareholders, or at all. In addition, shareholders may realize less than the original amount invested on dispositions of their shares during periods of such market price decline.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

*Foreign exchange risk*

The Company is a Canadian company and fundraising is done in Canadian dollars, however, its operations are predominantly denominated in U.S. dollars, Australian dollars, South Korean won, Euros, and Taiwan dollars. As a result, the Company is subject to foreign exchange risks relating to the relative value of these foreign currencies as compared to the Canadian dollar. A decline in these foreign currencies could result in a decrease in the real value of the Company's revenues and adversely impact financial performance.

*Tax* 

No assurance can be given that new taxation rules will not be enacted or existing rules will not be applied in a manner which could result in the Company being subject to additional taxation or which could otherwise have a material adverse effect on the Company's results from operations and financial condition.

*Investment risk* 

There is no assurance that the Company will achieve its investment objectives. An investment may not earn any positive return and may result in the loss of some or all of the capital invested.

*Ability to generate profits*

There can be no assurance that the Company will generate net profits in future periods. Further, there can be no assurance that the Company will be cash flow positive in future periods. In the event that the Company fails to achieve profitability in future periods, the value of the Company's shares may decline. In addition, if the Company is unable to achieve or maintain positive cash flows, the Company would be required to seek additional funding, which may not be available on favorable terms, if at all.

*Management of growth*

The Company has recently experienced, and may continue to experience, growth in the scope of its operations. This growth has resulted in increased responsibilities for the Company's existing personnel, the hiring of additional personnel and, in general, higher levels of operating expenses. In order to manage its current operations and any future growth effectively, the Company will need to continue to implement and improve its operational, financial and management information systems, as well as hire, manage and retain its employees and maintain its corporate culture including technical and customer service standards. There can be no assurance that the Company will be able to manage such growth effectively or that its management, personnel or systems will be adequate to support the Company's operations.

***Business and Industry Risks***

*Regulatory changes or actions may alter the nature of an investment in the Company or restrict the use of digital assets in a manner that adversely affects the Company's operations*

Due to their global nature, blockchain-related technologies and encryption-related technologies are subject to regulatory fragmentation due to different treatment depending on jurisdiction. Certain governments have categorized certain blockchain technologies as illegal, while others have embraced their utility and have approved them for trade. Ongoing and/or future regulatory actions may have a substantial impact on the Company's business operations.

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![](exhibit99-3x001.jpg)<br> **MANAGEMENT'S DISCUSSION AND ANALYSIS**<br> **FOR THE YEAR ENDED DECEMBER 31, 2025**<br>

*Acquisition integration risk*

The Company has completed or announced several strategic acquisitions and investments, including the QPerfect Acquisition and its joint development agreement with ICTK. The integration of acquired businesses, technologies, and personnel involves significant risks, including the potential for unanticipated liabilities, difficulties in retaining key personnel, challenges in integrating different corporate cultures, and the diversion of management's attention from existing operations. France's approval process for the QPerfect Acquisition remains pending and there is no assurance that such approval will be obtained on acceptable terms or at all. Failure to successfully integrate acquisitions could have a material adverse effect on the Company's business, financial condition, and results of operations.

*Pre-revenue product commercialization risk*

All of the Company's principal products, including QCIM, Bitcoin Quantum, and QSSN, are in pre-revenue stages of development. The Company has not generated material revenue from any of its core products and there is no assurance that any of the Company's products will achieve commercial viability, generate revenue, or achieve market acceptance. The transition from research and development to commercial revenue involves significant technical, market, and operational risks.

FORWARD-LOOKING STATEMENTS

*This MD&A includes certain statements that may be deemed "forward-looking statements" concerning the future performance of the Company's business, its operations, its financial performance and condition, as well as management's objectives, strategies, beliefs and intentions. Forward-looking statements are frequently identified by such words as "may", "will", "plan", "expect", "anticipate", "estimate", "intend" and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All statements in this report that do not directly and exclusively relate to historical facts, constitute forward- looking statements. These statements represent the Company's intentions, plans, expectations and beliefs, and are subject to risks, uncertainties and other factors of which many are beyond the control of the Company. These factors could cause actual results to differ materially from such forward-looking statements. The Company disclaims any intention or obligation to update or revise such forward-looking statements, as a result of new information, future events or otherwise. Factors that may cause actual results to vary from forward looking statements include, but are not limited to, the Company's ability to access capital, competitive risks and reliance on key personnel, as described in more detail in this document under "Risk Factors". Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements.*

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## Exhibit 99.4

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**CERTIFICATION**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Olivier Roussy Newton, certify that:

1. I have reviewed this Annual Report on Form 40-F of BTQ Technologies Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the issuer as of, and for, the periods presented in this report;

4. The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) [*paragraph omitted in accordance with Exchange Act Rule 13a-14(a)*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the issuer's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting; and

5. The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the audit committee of the issuer's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting that are reasonably likely to adversely affect the issuer's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting.

Date: March 30, 2026

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| |
|:---|
| /s/ Olivier Roussy Newton |
| Name: Olivier Roussy Newton |
| Title: Chief Executive Officer |
| (principal executive officer) |

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## Exhibit 99.5

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**CERTIFICATION**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Lonny Wong, certify that:

1. I have reviewed this Annual Report on Form 40-F of BTQ Technologies Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the issuer as of, and for, the periods presented in this report;

4. The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) [*paragraph omitted in accordance with Exchange Act Rule 13a-14(a)*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the issuer's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting; and

5. The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the audit committee of the issuer's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting that are reasonably likely to adversely affect the issuer's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting.

Date: March 30, 2026

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| |
|:---|
| /s/ Lonny Wong |
| Lonny Wong |
| Chief Financial Officer |
| (principal financial officer) |

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## Exhibit 99.6

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**CERTIFICATION PURSUANT TO**

**18 U.S.C. §1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of BTQ Technologies Corp. (the "Company") on Form 40-F for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Olivier Roussy Newton, Chief Executive Officer of the Company, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.<br>

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| | | |
|:---|:---|:---|
|  | By: | /s/ Olivier Roussy Newton |
| Date: March 30, 2026 |  | Olivier Roussy Newton |
|  |  | Chief Executive Officer |

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## Exhibit 99.7

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**CERTIFICATION PURSUANT TO**

**18 U.S.C. §1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of BTQ Technologies Corp. (the "Company") on Form 40-F for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Lonny Wong, Chief Financial Officer of the Company, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.<br>

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| | | |
|:---|:---|:---|
|  | By:  | /s/ Lonny Wong |
| Date: March 30, 2026 |  | Lonny Wong |
|  |  | Chief Financial Officer |

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## Exhibit 99.8

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![](exhibit99-8x1x1.jpg)

**CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

We consent to the incorporation by reference in the Registration Statement on Form 40-F (the "Form 40-F") of our auditor's report dated March 30, 2026 relating to the consolidated financial statements of BTQ Technologies Corp. consisting of the consolidated statements of financial position as at December 31, 2025 and 2024 and the related consolidated statements of operations and comprehensive loss, changes in shareholders' equity and cash flows for the years then ended, which appears as Exhibit 99.2 to the Form 40-F being filed with the United States Securities and Exchange Commission.

We also consent to reference to us under the heading Interests of Experts in the Annual Information Form, filed as Exhibit 99.1 to the Form 40-F.

![](exhibit99-8xu001.jpg)

Chartered Professional Accountants

Licensed Public Accountants

March 30, 2026

Toronto, Canada

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| | |
|:---|:---|
| **MNP LLP** |  |
| 1 Adelaide Street East, Suite 1900, Toronto ON, M5C 2V9 | 1.877.251.2922 T: 416.596.1711 F: 416.596.7894 |

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