# EDGAR Filing Document

**Accession Number:** 0001436229
**File Stem:** 0001641172-25-023517
**Filing Date:** 2025-8
**Character Count:** 169866
**Document Hash:** 3f7bd99fb9c3aa15584b9800f08680ef
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001641172-25-023517.hdr.sgml**: 20250813

**ACCESSION NUMBER**: 0001641172-25-023517

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 71

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250813

**DATE AS OF CHANGE**: 20250813

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** BTCS Inc.
- **CENTRAL INDEX KEY:** 0001436229
- **STANDARD INDUSTRIAL CLASSIFICATION:** FINANCE SERVICES [6199]
- **ORGANIZATION NAME:** 09 Crypto Assets
- **EIN:** 262477977
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-40792
- **FILM NUMBER:** 251212187

**BUSINESS ADDRESS:**
- **STREET 1:** 9466 GEORGIA AVENUE #124
- **CITY:** SILVER SPRING
- **STATE:** MD
- **ZIP:** 20910
- **BUSINESS PHONE:** 202-430-6576

**MAIL ADDRESS:**
- **STREET 1:** 9466 GEORGIA AVENUE #124
- **CITY:** SILVER SPRING
- **STATE:** MD
- **ZIP:** 20910

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Bitcoin Shop, Inc.
- **DATE OF NAME CHANGE:** 20150422

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** BITCOIN SHOP INC.
- **DATE OF NAME CHANGE:** 20140204

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** TouchIT Technologies, Inc.
- **DATE OF NAME CHANGE:** 20100524

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**Form 10-Q**

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** 

For the quarterly period ended June 30, 2025

or

☐ **TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the transition period from ________________ to____________.

Commission file number: 001-40792

**BTCS Inc.**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada** | **90-1096644** |
| (State or other jurisdiction<br> of incorporation or organization) | (I.R.S. Employer<br> Identification No.) |

---

---

| | |
|:---|:---|
| **9466 Georgia Avenue #124, Silver Spring, MD** | **20910** |
| (Address of principal executive offices) | (Zip Code) |

---

**Registrant's telephone number, including area code (202) 430-6576**

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

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| Common Stock, par value $0.001 | BTCS | The Nasdaq Stock Market |
|  |  | (The Nasdaq Capital Market) |

---

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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. 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). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> Emerging growth company ☐

If an emerging growth company, 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of August 12, 2025, there were 48,052,778 shares of Common Stock, par value $0.001, issued and outstanding.

**BTCS INC.**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  |  | Page |
| **[PART I - FINANCIAL INFORMATION](#an_001)** | **[PART I - FINANCIAL INFORMATION](#an_001)** |  |
| ITEM 1 | [Financial Statements](#an_002) | 4 |
|  | [Condensed Consolidated Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024](#an_003) | 4 |
|  | [Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)](#an_004) | 5 |
|  | [Condensed Consolidated Statements of Changes in Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)](#an_005) | 6 |
|  | [Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (unaudited)](#an_006) | 8 |
|  | [Notes to the Unaudited Condensed Consolidated Financial Statements](#an_007) | 9-28 |
| ITEM 2 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#m_001) | 29 |
| ITEM 3 | [Quantitative and Qualitative Disclosures About Market Risk](#m_002) | 40 |
| ITEM 4 | [Controls and Procedures](#m_003) | 40 |
| **[PART II - OTHER INFORMATION](#m_004)** | **[PART II - OTHER INFORMATION](#m_004)** |  |
| ITEM 1 | [Legal Proceedings](#m_005) | 41 |
| ITEM 1A | [Risk Factors](#m_006) | 41 |
| ITEM 2 | [Unregistered Sales of Equity Securities and Use of Proceeds](#m_007) | 41 |
| ITEM 3 | [Defaults Upon Senior Securities](#m_008) | 41 |
| ITEM 4 | [Mine Safety Disclosures](#m_009) | 41 |
| ITEM 5 | [Other Information](#m_010) | 41 |
| ITEM 6 | [Exhibits](#m_011) | 41 |
|  | [Signature](#m_012) | 42 |

---

**BTCS INC.**

As used in this Quarterly Report on Form 10-Q, the terms "we," "us," "our," the "Company," the "Registrant," and "BTCS Inc.," mean BTCS Inc., unless otherwise indicated.

**PART I - FINANCIAL INFORMATION**

**ITEM 1 Financial Statements**

**BTCS Inc.**

**Condensed Consolidated Balance Sheets**

---

| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,**<br>**2024** |
|  | **(Unaudited)** | |
| **Assets:** |  |  |
| Current assets: |  |  |
| Cash and cash equivalents | $639189 | $1977778 |
| Stablecoins | 2850 | 39545 |
| Crypto assets | 10837423 | 646539 |
| Staked crypto assets | 28588212 | 35410144 |
| Receivable for capital shares sold | 156299 |  |
| Prepaid expenses | 228218 | 63934 |
| &nbsp;&nbsp;&nbsp;Total current assets | 40452191 | 38137940 |
| Other assets: |  |  |
| Investments, at value (Cost $350,000) | 350000 | 100000 |
| Property and equipment, net | 7367 | 7449 |
| &nbsp;&nbsp;&nbsp;Total other assets | 357367 | 107449 |
| **Total Assets** | $**40809558** | $**38245389** |
| **Liabilities and Stockholders' Equity:** |  |  |
| Current liabilities: |  |  |
| Accounts payable and accrued expenses | $102607 | $70444 |
| Accrued compensation | 621017 | 3907091 |
| Accrued interest | 6621 |  |
| Loan payable - DeFi protocol | 4000000 |  |
| Warrant liabilities | 208050 | 267900 |
| &nbsp;&nbsp;&nbsp;Total current liabilities | 4938295 | 4245435 |
| Non-current liabilities: |  |  |
| Convertible notes payable, net | 4801098 | - |
| &nbsp;&nbsp;&nbsp;Total non-current liabilities | 4801098 | - |
| Total liabilities | 9739393 | 4245435 |
| Stockholders' equity: |  |  |
| Preferred Stock, $0.001 par value per share; 20,000,000 shares authorized, of which: |  |  |
| Series V Preferred Stock; 16,004,738 and 15,033,231 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively | 2818271 | 2646314 |
| Common Stock, $0.001 par value per share; 975,000,000 shares authorized; 21,968,566 and 18,717,743 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively | 21969 | 18718 |
| Additional paid-in capital | 181565367 | 171283199 |
| Accumulated deficit | (153335442) | (139948277) |
| Total stockholders' equity | 31070165 | 33999954 |
| **Total Liabilities and Stockholders' Equity** | $**40809558** | $**38245389** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BTCS Inc.**

**Condensed Consolidated Statements of Operations**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | **For the Six Months Ended** | **For the Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Blockchain infrastructure revenues | $2772198 | $561192 | $4461133 | $1012578 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 2772198 | 561192 | 4461133 | 1012578 |
| Cost of revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Blockchain infrastructure costs | 2853133 | 168848 | 4421792 | 329473 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | (80935) | 392344 | 39341 | 683105 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative | 659645 | 538956 | 1218033 | $1026555 |
| &nbsp;&nbsp;&nbsp;Compensation and related expenses | 793400 | 875491 | 1481602 | 1331270 |
| &nbsp;&nbsp;&nbsp;Research and development | 193543 | 163777 | 402794 | 310326 |
| &nbsp;&nbsp;&nbsp;Marketing | 22861 | 28477 | 268033 | 86079 |
| &nbsp;&nbsp;&nbsp;Realized (gains) losses on crypto asset transactions | 2777620 | (287327) | 4159908 | (298014) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 4447069 | 1319374 | 7530370 | 2456216 |
| Other income (expenses): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 3569 |  | 3569 |  |
| &nbsp;&nbsp;&nbsp;Interest expense | (221894) |  | (221894) |  |
| &nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) of crypto assets | 8793161 | (5943339) | (5737661) | 7159328 |
| &nbsp;&nbsp;&nbsp;Change in fair value of warrant liabilities | (165300) | 142500 | 59850 | 142500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other income (expenses) | 8409536 | (5800839) | (5896136) | 7301828 |
| **Net income (loss)** | $**3881532** | $**(6727869)** | $**(13387165)** | $**5528717** |
| Net income (loss) per share attributable to common stockholders |  |  |  |  |
| &nbsp;&nbsp;&nbsp; Basic | $0.18 | $(0.43) | $(0.65) | $0.35 |
| &nbsp;&nbsp;&nbsp;Diluted | $0.14 | $(0.43) | $(0.65) | $0.28 |
| Weighted-average shares of common stock used to compute net income per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 21259682 | 15758157 | 20616935 | 15724917 |
| &nbsp;&nbsp;&nbsp;Diluted | 27938660 | 15758157 | 20616935 | 19447348 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BTCS Inc.**

**Condensed Consolidated Statements of Changes in Stockholders' Equity**

**(Unaudited)**

**For the Six Months Ended June 30, 2025**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series V** | **Series V** | | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** | **Total**<br>**Stockholders'**<br>**Equity** |
| **Balance at December 31, 2024** | **15033231** | $**2646314** | **18717743** | $**18718** | $**171283199** | $**(139948277)** | $**&nbsp;&nbsp;&nbsp;&nbsp;33999954** |
| Issuance of common stock, net of offering cost / At-the-market offering |  |  | 1871889 | 1872 | 4077213 |  | 4079085 |
| Issuance of warrants in connection with convertible note |  |  |  |  | 2533311 |  | 2533311 |
| Stock-based compensation | 1020834 | 180688 | 1508261 | 1508 | 3924842 |  | 4107038 |
| Forfeiture of stock-based awards | (49327) | (8731) | (129327) | (129) | (253198) |  | (262058) |
| Net income (loss) | - | - | - | - | - | (13387165) | (13387165) |
| **Balance at June 30, 2025** | **16004738** | $**2818271** | **21968566** | $**21969** | $**181565367** | $**(153335442)** | $**31070165** |

---

(1) Includes 1,069,801 restricted shares of Series V Preferred Stock held by employees that remain subject to forfeiture based on time-based vesting
 conditions. See Note 6 – *Stockholders' Equity (Deficit)* for further details.

(2) Includes 1,312,301 restricted shares of Common Stock held by employees that remain subject to forfeiture based on time-based vesting conditions.
 See Note 6 – *Stockholders' Equity (Deficit)* for further details.

**For the Six Months Ended June 30, 2024**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series V** | **Series V** | | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** | **Total**<br>**Stockholders'**<br>**Equity** |
| **Balance at December 31, 2023** | **14567829** | $**2563938** | **15320281** | $**15322** | $**162263634** | $**(138677103)** | $**&nbsp;&nbsp;&nbsp;&nbsp;26165791** |
| Issuance of common stock, net of offering cost / At-the-market offering |  |  | 163831 | 163 | 240142 |  | 240305 |
| Stock-based compensation |  |  | 410915 | 410 | 1177674 |  | 1178084 |
| Net income (loss) | - | - | - | - | - | 5528717 | 5528717 |
| **Balance at June 30, 2024** | **14567829** | $**2563938** | **15895027** | $**15895** | $**163681450** | $**(133148386)** | $**33112897** |

---

**For the Three Months Ended June 30, 2025**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series V** | **Series V** | **Series V** | |  | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** |  | **Amount** | **Shares** |  | **Amount** | **Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** | **Total**<br>**Stockholders'**<br>**Equity** |
| **Balance at March 31, 2025** | **16004738** | **(1)** | $**2818271** | **20206880** |  | $**20207** | $**174937017** | $**(157216974)** | $**&nbsp;&nbsp;&nbsp;&nbsp;20558521** |
| Issuance of common stock, net of offering cost / At-the-market offering |  |  |  | 1744640 |  | 1745 | 3848384 |  | 3850129 |
| Issuance of warrants in connection with convertible note |  |  |  |  |  |  | 2533311 |  | 2533311 |
| Stock-based compensation |  |  |  | 17046 |  | 17 | 246655 |  | 246672 |
| Net income (loss) | - |  | - | - |  | - | - | 3881532 | 3881532 |
| **Balance at June 30, 2025** | **16004738** | **(1)** | $**2818271** | **21968566** | **(2)** | $**21969** | $**181565367** | $**(153335442)** | $**31070165** |

---

(1) Includes 1,069,801 restricted shares of Series V Preferred Stock held by employees that remain subject to forfeiture based on time-based vesting
 conditions. See Note 6 – *Stockholders' Equity (Deficit)* for further details.

(2) Includes 1,312,301 restricted shares of Common Stock held by employees that remain subject to forfeiture based on time-based vesting conditions.
 See Note 6 – *Stockholders' Equity (Deficit)* for further details.

**For the Three Months Ended June 30, 2024**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series V** | **Series V** | | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** | **Total**<br>**Stockholders'**<br>**Equity** |
| **Balance at March 31, 2024** | **14567829** | $**2563938** | **15705415** | $**15707** | $**163141291** | $**(126420517)** | $**&nbsp;&nbsp;&nbsp;&nbsp;39300419** |
| Issuance of common stock, net of offering cost / At-the-market offering |  |  | 163831 | 163 | 240142 |  | 240305 |
| Stock-based compensation |  |  | 25781 | 25 | 300017 |  | 300042 |
| Net income (loss) | - | - | - | - | - | (6727869) | (6727869) |
| **Balance at June 30, 2024** | **14567829** | $**2563938** | **15895027** | $**15895** | $**163681450** | $**(133148386)** | $**33112897** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BTCS Inc.**

**Condensed Consolidated Statements of Cash Flows**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended** | **For the Six Months Ended** |
|  | **June 30,** | **June 30,** |
|  | **2025** | **2024** |
| **Net cash flows used in operating activities:** |  |  |
| Net income (loss) | $(13387165) | $5528717 |
| Adjustments to reconcile net income to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation expense | 1778 | 2990 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 3844980 | 1178084 |
| &nbsp;&nbsp;&nbsp;Blockchain infrastructure revenue | (4461133) | (1012578) |
| &nbsp;&nbsp;&nbsp;Builder payments (non-cash) | 4301615 | 158112 |
| &nbsp;&nbsp;&nbsp;Blockchain network fees (non-cash) | 6907 |  |
| &nbsp;&nbsp;&nbsp;Change in fair value of warrant liabilities | (59850) | (142500) |
| &nbsp;&nbsp;&nbsp;Amortization on debt discount and issuance costs | 150963 |  |
| &nbsp;&nbsp;&nbsp;Realized losses on crypto assets transactions | 4159908 | (298014) |
| &nbsp;&nbsp;&nbsp;Change in unrealized (appreciation) depreciation of crypto assets | 5737661 | (7159328) |
| Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Stablecoins | 36695 | 6247 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (164284) | (118458) |
| &nbsp;&nbsp;&nbsp;Receivable for capital shares sold | (156299) | 291440 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | 32163 | 75792 |
| &nbsp;&nbsp;&nbsp;Accrued compensation | (3286074) | (203603) |
| &nbsp;&nbsp;&nbsp;Accrued interest | 6621 | - |
| Net cash used in operating activities | (3235514) | (1693099) |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of productive crypto assets for validating | (14179117) | (19212) |
| &nbsp;&nbsp;&nbsp;Sale of productive crypto assets | 1065207 | 550361 |
| &nbsp;&nbsp;&nbsp;Purchase of investments | (250000) |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | (3446) |  |
| &nbsp;&nbsp;&nbsp;Sale of property and equipment | 1750 | - |
| Net cash provided by (used in) investing activities | (13365606) | 531149 |
| **Cash flow from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from issuance common stock/ At-the-market offering | 4079085 | 240305 |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of convertible notes, net | 7306000 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from Defi borrowing | 5447000 |  |
| &nbsp;&nbsp;&nbsp;Payments to Defi borrowing | (1447000) |  |
| &nbsp;&nbsp;&nbsp;Payments of debt issuance costs | (122554) | - |
| Net cash provided by financing activities | 15262531 | 240305 |
| Net (decrease)/increase in cash | (1338589) | (921645) |
| Cash, beginning of period | 1977778 | 1458327 |
| Cash, end of period | $639189 | $536682 |
| **Supplemental disclosure of non-cash financing and investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Series V Preferred Stock Distribution | $180688 | $- |
| &nbsp;&nbsp;&nbsp;Cash paid for interest | $64310 | $- |
| &nbsp;&nbsp;&nbsp;Non-cash discount on convertible notes | $504526 | $- |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BTCS Inc.**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Note 1 - Business Organization and Nature of Operations**

BTCS Inc. ("BTCS" or the "Company"), short for Blockchain Technology Consensus Solutions, is a Nevada corporation listed on Nasdaq and headquartered in the United States. The Company is an Ethereum-first blockchain technology business focused on scalable revenue generation and ETH accumulation through its vertically integrated blockchain infrastructure operations.

BTCS operates two core infrastructure initiatives: NodeOps, which operates Ethereum validator nodes ("nodes") and earns ETH-denominated staking rewards; and **Builder+**, a proprietary Ethereum block builder that constructs and submits optimized blocks to the network in order to earn execution layer rewards, such as transaction fees and MEV (maximal extractable value). These operations collectively form the foundation of the Company's blockchain infrastructure strategy and drive the ETH-denominated revenue that supports its treasury growth.

BTCS's operations are strategically supported by its DeFi/TradFi Flywheel, a capital formation and reinvestment framework that leverages both decentralized finance (e.g., on-chain borrowing) and traditional capital markets (e.g., ATM equity offerings and structured convertible notes) to scale blockchain infrastructure operations, accelerate revenue growth and increase ETH accumulation while minimizing shareholder dilution.

During the six months ended June 30, 2025, the Company completed a strategic wind-down of its validator node operations on Avalanche (AVAX), Cosmos (ATOM), Akash (AKT), and Kava (KAVA), and liquidated the majority of its non-Ethereum token holdings. These actions were undertaken to align operations and capital allocation with the Company's ETH-centric focus.

In addition to its Ethereum operations, BTCS has deployed Builder+ to select EVM-compatible ecosystems, including Binance Smart Chain ("BSC"), where it participates in the decentralized block-building marketplace. While ETH remains the Company's principal focus, this cross-chain expansion highlights the scalability of its infrastructure.

The Company's operations are subject to various risks, including technological complexity, regulatory uncertainty, market volatility, and competition within the blockchain infrastructure space. BTCS's future success depends on Ethereum's continued adoption, the maturity of decentralized infrastructure markets, and the Company's ability to operate blockchain infrastructure at scale.

**Note 2 - Basis of Presentation**

*Basis of Presentation*

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information, the instructions to Form 10-Q and the rules and regulations of the SEC. Accordingly, since they are interim statements, the accompanying unaudited condensed consolidated financial statements do not include all of the information and notes required by GAAP for annual financial statements, but in the opinion of the Company's management, reflect all adjustments consisting of normal, recurring adjustments, that are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Interim results for the three months ended June 30, 2025 are not necessarily indicative of results for the full year ending December 31, 2025. The unaudited condensed consolidated financial statements and notes should be read in conjunction with the consolidated financial statements and notes for the year ended December 31, 2024.

*Reclassifications*

Certain prior period amounts have been reclassified in order to conform with the current period presentation in the unaudited condensed consolidated financial statements and accompanying notes. The reclassifications did not have a material impact on the Company's unaudited condensed consolidated financial statements and related disclosures. The impact on any prior period disclosures was immaterial.

**Note 3 - Summary of Significant Accounting Policies**

There have been no material changes in the Company's significant accounting policies to those previously disclosed in the 2024 Annual Report on the Company's Form 10-K filed with the Securities and Exchange Commission.

*Cash and Cash Equivalents*

The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash and cash equivalents. The Company maintains cash and cash equivalent balances at financial institutions that are insured by the FDIC. As of June 30, 2025 and December 31, 2024, the Company had approximately $639,000 and $1,978,000 in cash. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. As of June 30, 2025 and December 31, 2024, the Company had approximately $351,000 and $1,474,000 in excess of the FDIC insured limit, respectively.

*Stablecoins*

The Company holds stablecoins, including, but not limited to, USDT (Tether) and USDC (USD Coin), which are crypto assets that are pegged to the value of designed to maintain a value equivalent to one U.S. dollar. Our stablecoins are typically held in secure digital wallets or on crypto asset exchanges. The Company acquires and holds stablecoins primarily to facilitate crypto asset transactions, including, but not limited to, payments to third-party vendors. While not accounted for as cash or cash equivalents, these stablecoins are considered a liquidity resource.

*Crypto Assets*

The Company's crypto assets primarily consist of Ethereum and other crypto assets held in non-custodial wallets.

Fair Value Measurement

The Company accounts for the fair value measurement of its crypto assets in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 820, *Fair Value Measurement*. ASC 820 defines fair value as the price that would be received for an asset in a current sale, assuming an orderly transaction between market participants on the measurement date. Market participants are considered to be independent, knowledgeable, and willing and able to transact. It requires the Company to assume that its crypto assets are sold in their principal market or, in the absence of a principal market, the most advantageous market.

Kraken serves as the principal market for the Company's crypto assets, being the Company's primary cryptocurrency exchange for both purchases and sales. Coinbase is designated as the secondary principal market. This determination results from a comprehensive evaluation considering various factors, including compliance, trading activity, and price stability.

The fair value of crypto assets is primarily determined based on pricing data obtained from Kraken, the Company's principal market. In the absence of Kraken data, pricing from Coinbase serves as a secondary source.

While Kraken is designated as the primary exchange, the Company retains flexibility to conduct cryptocurrency transactions on other exchanges where it maintains accounts. This flexibility allows the Company to adapt to changing market conditions and explore alternative platforms when necessary to ensure cost-effective execution and fair value measurement using the most advantageous market.

The selection of Kraken as the principal market reflects the Company's commitment to informed decision-making and achieving the most accurate representation of fair value for its crypto assets. Regular reviews ensure alignment with the Company's objectives and cryptocurrency market dynamics.

Accounting for Crypto Assets

*Fair Market Value*

Crypto assets are measured at their respective fair market values using the last close price of the day in the UTC time zone at each reporting period end on the balance sheets and classified as either 'Staked Crypto Assets' or 'Crypto Assets' to distinguish their nature within the respective balances. Staked crypto assets are presented as current assets if their lock-up periods are less than 12 months, and as long-term other assets if the lock-up extends beyond one year. The majority of our crypto assets are staked, typically with lock-up periods of less than 28 days, and are considered current assets in accordance with ASC 210-10-20, *Balance Sheet*, due to the Company's ability to sell them in a liquid marketplace, as we have a reasonable expectation that they will be realized in cash or sold or consumed during the normal operating cycle of our business to support operations when needed

*Cost Basis*

Effective January 1, 2025, the Company enhanced its accounting systems and processes related to the receipt and valuation of crypto assets. As a result of these enhancements, the Company updated its accounting policy for determining the cost basis of crypto assets received. The cost basis is now measured at fair value based on the spot price at the time of receipt, consistent with the applicable guidance under ASC 350-60.

Prior to January 1, 2025, the cost basis of crypto assets was measured using the last close price of the day in the UTC (Coordinated Universal Time) time zone on the date of receipt.

The change has been applied prospectively and did not have a material impact on the Company's financial statements.

*Cost Relief in Determining Realized Gains and Losses*

In conjunction with ongoing system and process enhancements, the Company updated its method for determining the cost basis of crypto assets used in computing realized gains and losses. Effective January 1, 2025, the Company adopted the Last-In, First-Out ("LIFO") method for determining the cost basis of crypto assets disposed of. This method assumes that the most recently acquired assets are sold or used first and replaces the Company's previous use of the specific identification method, which tracked the actual cost of each individual asset sold.

The Company determined that the change in accounting principle is preferable as it better aligns with the Company's operational systems and financial reporting objectives. The change has been applied prospectively beginning January 1, 2025, as retrospective application was deemed impracticable due to the nature of prior lot-level selection processes under the specific identification method.

Realized gains (losses) on sale of crypto assets are included in other income (expenses) in the consolidated statements of operations. The Company recorded realized gains (losses) on crypto assets of approximately ($2,778,000) and $287,000 for the three months ended June 30, 2025 and 2024, respectively, and approximately ($4,160,000) and $298,000 for the six months ended June 30, 2025 and 2024, respectively.

The Company does not believe the change materially impacts comparability of results. While the realized loss for the three and six months ended June 30, 2025, reflects application of the new LIFO method, it is not practicable to quantify the exact impact of the change as compared to the prior method, given the subjective lot selection involved in specific identification. Based on this assessment, the Company does not believe the change has a material effect on the consolidated financial statements.

*Presentation of Crypto Assets in Financial Statements*

The classification of purchases and sales in the consolidated statements of cash flows is determined based on the nature of the crypto assets, which can be categorized as 'productive' (i.e. acquired for purposes of staking) or 'non-productive' (e.g., bitcoin). Acquisitions of non-productive crypto assets are treated as operating activities, while acquisitions of productive crypto assets are classified as investing activities in accordance with ASC 230-10-20, *Investing activities*. Productive crypto assets staked with lock-up periods of less than 12 months are listed as current assets in the 'Staked Crypto Assets' line item on the balance sheet. Staked crypto assets with lock-up periods exceeding 12 months are categorized as long-term other assets. Non-productive crypto assets are included in the 'Crypto Assets' line item on the balance sheet.

Crypto assets used as collateral for DeFi borrowings remain on the Company's balance sheet, as the Company retains ownership and control of the associated wallet and the assets are not transferred to a counterparty. While deposited into a smart contract and restricted from use, the crypto assets are not derecognized. These assets are presented within "Crypto Assets" on the balance sheet and disclosed separately in the footnotes when serving as collateral.

In arrangements such as Aave, ETH is deposited as collateral into a smart contract, which remains in the Company's wallet but is restricted from transfer until the associated borrowing is repaid. The Company continues to recognize the underlying ETH as a crypto asset on its balance sheet, with a corresponding disclosure of its restricted status.

*Operating Segments*

The Company's blockchain infrastructure operations include two primary revenue-generating activities: Ethereum block building ("Builder+") and validator node operations ("NodeOps").

The Company's Chief Operating Decision Maker ("CODM") is comprised of several members of its executive management team, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), who are responsible for evaluating the Company's financial performance, managing operations, and allocating capital and resources.

The CODM regularly reviews discrete financial information related to Builder+ and NodeOps, assessing financial performance based on gross profit (loss), direct operating expenses, and key financial metrics. These financial reviews direct operational decisions and shape capital deployment strategies for each activity.

While the CODM evaluates Builder+ and NodeOps separately, these activities share common economic characteristics, infrastructure, and operational oversight and are therefore aggregated into a single operating segment under ASC 280, Segment Reporting.

Consistent with ASU 2023-07, the Company discloses significant segment expenses that are regularly provided to the CODM for decision-making purposes. See Note 11 – *Segment Information* for more information.

*Revenue Recognition*

The Company recognizes revenue under ASC 606*, Revenue from Contracts with Customers*. The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle:

● Step 1: Identify the contract with the customer

● Step 2: Identify the performance obligations in the contract

● Step 3: Determine the transaction price

● Step 4: Allocate the transaction price to the performance obligations in the contract

● Step 5: Recognize revenue when the Company satisfies a performance obligation

Revenue is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company generates revenue through 1) staking rewards generated from its blockchain infrastructure operations (NodeOps), and 2) gas fees earned from successful Ethereum block-building through Builder+. These revenues are collectively termed 'Blockchain infrastructure revenues' in the consolidated statements of operations.

The transaction consideration the Company receives - the crypto asset awards and gas fees - are a non-cash consideration, which the Company measures at fair value on the date received.

Blockchain Infrastructure (NodeOps)

The Company engages in network-based smart contracts by running its own crypto asset validator nodes as well as by staking (or "delegating") crypto assets directly to both its own validator nodes and nodes run by third-party operators. Through these contracts, the Company provides crypto assets to stake to a node for the purpose of validating transactions and adding blocks to a respective blockchain network. The term of a smart contract can vary based on the rules of the respective blockchain and typically lasts from a few days to several weeks after it is cancelled (or "un-staked") by the delegator and requires that the crypto assets staked remain locked up during the duration of the smart contract.

In exchange for staking the crypto assets and validating transactions on blockchain networks, the Company is entitled to all of the fixed crypto asset award earned from the network when delegating to the Company's own node and is entitled to a fractional share of the fixed crypto asset award a third-party node operator receives (less crypto asset transaction fees payable to the node operator, which are immaterial and are recorded as a deduction from revenue), for successfully validating or adding a block to the blockchain. The Company's fractional share of awards received from delegating to a third-party validator node is proportionate to the crypto assets staked by the Company compared to the total crypto assets staked by all Delegators to that node at that time.

On certain blockchain networks on which the Company operates a validator node, the Company earns a validator node fee ("Validator Fee"), determined as a node operator's published percentage of the crypto asset rewards earned on crypto assets delegated to its node.

Token rewards earned from staking, as well as tokens earned as Validator Fees, are calculated and distributed directly to BTCS digital wallets by the blockchain networks as part of their consensus mechanisms.

The provision of validating blockchain transactions is an output of the Company's ordinary activities. Each separate block creation or validation under a smart contract with a network represents a performance obligation. The satisfaction of the performance obligation for processing and validating blockchain transactions occurs at a point in time when confirmation is received from the network indicating that the validation is complete, and the awards are available for transfer. At that point, revenue is recognized.

Block-Building (Builder+)

The Company earns revenue by participating as a Builder on blockchain networks that have implemented a Proposer-Builder Separation (PBS) framework, including Ethereum and Binance Smart Chain ("BSC"). In these roles, the Company bundles and proposes transaction blocks for submission to network Validators ("block building"), and is compensated when its blocks are selected, proposed, and successfully finalized on the applicable network.

*Ethereum Block Building*

The Company participates in the Ethereum blockchain network by engaging in the construction of blocks containing strategically bundled transactions from the Ethereum mempool and from searchers who connect to the Company's endpoint with the intent of the Company's builder proposing their transactions. Revenue recognition for these activities, conducted through Builder+, entails the recognition of gas fees (or "transaction fees") and priority fees (or "tips") earned in exchange for successfully constructing blocks of bundled transactions and having these blocks selected and proposed by a validator to the Ethereum network for validation and successfully finalized on the network.

These gas fees are earned as a direct result of the Company's fulfillment of its performance obligations, which include the construction of blocks by bundling transactions to maximize the value of the included fees and the proposal of that block by a Validator. Each constructed block under a smart contract with the Ethereum network signifies a distinct performance obligation.

As part of the block construction and proposal process, the Company's Builder purchases block space through a fixed non-negotiable fee paid to a Validator (a "Validator Payment") embedded in each proposed block. The Validator Payment, predetermined by the Builder, is paid to Validators as compensation for selecting and proposing the Company's block to the network for validation. The Validator Payment is intrinsically linked to the Company's performance obligations and is disbursed in the block constructed by the Builder if our Builder's block is both selected by a Validator and successfully proposed to, and finalized on, the Ethereum network; otherwise, our Validator Payment may be included in a subsequent block. The Validator Payment represents a direct and fixed pre-determined cost.

The satisfaction of the performance obligation occurs at a point in time when the constructed block is both proposed by a Validator and successfully finalized on the Ethereum network. At this juncture, the Company has fulfilled its obligations, and the gas fees and tips associated with the transactions included in the block become available and are transferred to the Company's digital wallet.

The Company recognizes revenue, reflecting the fair value of the total gas fees and tips earned from the constructed block.

*Binance Smart Chain (BSC) Block Building*

The Company also operates as a Builder on Binance Smart Chain (BSC), which uses a Proof-of-Staked-Authority ("PoSA") consensus and a distinct block-building and reward structure. The native token of BSC is BNB, which is used for both gas fees and transaction-based payments.

Builders on BSC construct block bids composed of transactions and optional searcher tips. Unlike Ethereum, gas fees on BSC are paid directly to the Validator's coinbase and are not received by the Builder. Instead, the Builder earns revenue in the form of BNB-denominated tips, which are voluntarily sent by searchers to a Builder-controlled smart contract as priority fees. These tips accumulate in the smart contract and are periodically withdrawn to the Company's Builder wallet.

The Company recognizes revenue from BSC block building at the time the BNB tips are withdrawn from the tip smart contract to the Company's wallet, measured at the fair value of BNB on the withdrawal date. Because BSC validator payments are embedded in the gas fees of a self-transfer transaction appended by the Builder, the associated gas cost is treated as cost of revenue.

Builder performance obligations on BSC are satisfied when the constructed block is selected and proposed by a Validator and finalized on-chain. Similar to Ethereum, each block is considered a separate performance obligation.

The following table summarizes the revenues earned from the Company's operations for the three and six months ended June 30, 2025 and 2024.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| *Revenue from blockchain infrastructure operations* |  |  |  |  |
| &nbsp;&nbsp;&nbsp;NodeOps | $262972 | $485339 | $602263 | $903692 |
| &nbsp;&nbsp;&nbsp;Builder+ | 2509226 | 75853 | 3858870 | 108886 |
| **Total revenue** | $**2772198** | $**561192** | $**4461133** | $**1012578** |

---

The following tables detail the native token rewards and their respective fair market value recognized as revenue for the three and six months ended June 30, 2025 and 2024. Revenues earned from blockchain infrastructure staking activities through NodeOps include token rewards earned from the delegation of cryptocurrency assets to third-party validator nodes as well as token rewards derived from BTCS-operated validator nodes, which include staking of the Company's crypto assets to BTCS nodes and Validator Fees earned from third-parties asset delegations to our nodes. Revenues earned from block-building through Builder+ includes block rewards generated by BTCS Builders.

Crypto assets earned from blockchain infrastructure staking activities through NodeOps

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
| | **2025** | **2025** | **2024** | **2024** | **2025** | **2025** | **2024** | **2024** |
| <br>**Asset** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** |
| Ethereum (ETH) | 69 | $148351 | 72 | $241588 | 139 | $334546 | 138 | $429666 |
| Cosmos (ATOM) | 16990 | $74636 | 12565 | $104580 | 33303 | $159486 | 23731 | $225654 |
| Solana (SOL)\* | 92 | $14184 | 139 | $21353 | 209 | $34787 | 259 | $36725 |
| Axie Infinity (AXS)\* | 4569 | $11953 | 5772 | $36379 | 10887 | $30476 | 11152 | $84701 |
| Akash (AKT) | 2272 | $3367 | 6246 | $26740 | 8229 | $15202 | 10820 | $45486 |
| NEAR Protocol (NEAR)\* | 1450 | $3826 | 1886 | $12500 | 3482 | $11298 | 2600 | $16922 |
| Avalanche (AVAX) | 253 | $4917 | 668 | $18491 | 543 | $11322 | 668 | $18491 |
| Kava (KAVA) | 4020 | $1738 | 6632 | $4305 | 11031 | $4983 | 12924 | $9557 |
| Stader (SD)\* |  | $- |  | $- | 126 | $89 |  | $- |
| Polkadot (DOT)\* |  | $- | 376 | $2619 | 9 | $40 | 736 | $5576 |
| Rocket Pool (RPL)\* |  | $- |  | $- | 10 | $34 |  | $- |
| Kusama (KSM) |  | $- | 279 | $8108 |  | $- | 289 | $8583 |
| Polygon (POL)\* |  | $- | 6314 | $3758 |  | $- | 12544 | $9489 |
| Tezos (XTZ)\* |  | $- | 354 | $338 |  | $- | 671 | $705 |
| Mina (MINA) |  | $- | 2880 | $2439 |  | $- | 5760 | $6085 |
| Oasis Network (ROSE) |  | $- | 10431 | $1036 |  | $- | 26567 | $3254 |
| Cardano (ADA)\* |  | $- | 2039 | $837 |  | $- | 3328 | $1590 |
| Evmos (EVMOS)\* | - | $- | 6834 | $268 | - | $- | 18260 | $1208 |
| &nbsp;&nbsp;&nbsp;**Total earned from blockchain infrastructure staking activities through NodeOps** |  | $**262972** |  | $**485339** |  | $**602263** |  | $**903692** |

---

\* All or a portion of revenue earned from staking to third-party validator nodes

Crypto assets earned from block-building through Builder+

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
| | **2025** | **2025** | **2024** | **2024** | **2025** | **2025** | **2024** | **2024** |
| <br>**Asset** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** | **Token Rewards** | **Revenue ($USD)** |
| Ethereum (ETH) | 912 | $2101709 | 23 | $75853 | 1406 | $3451353 | 34 | $108886 |
| BNB Chain (BNB) | 638 | $407517 | - | $- | 638 | $407517 | - | $- |
| &nbsp;&nbsp;&nbsp;**Total earned from block-building through Builder+** |  | $**2509226** |  | $**75853** |  | $**3858870** |  | $**108886** |

---

*Cost of Revenues*

The Company's cost of revenues related to its blockchain infrastructure operations primarily includes direct production costs associated with transaction validation on the network, cloud-based server hosting expenses related to our validator nodes and Builders, and allocated employee salaries dedicated to node maintenance and support.

Additionally, for Ethereum block building, cost of revenues includes Validator Payments made by the Company's Builder to Validators as compensation for proposing constructed blocks. These are fixed amounts embedded in the proposed blocks and are only paid when the block is successfully finalized on-chain.

For Binance Smart Chain (BSC) block building, although the Builder does not receive the gas fees from the bundled transactions included in a finalized block, it must still compete for inclusion by proposing an additional bid, structured as a self-transaction, that specifies extra gas fees intended to incentivize the Validator to select its block. This self-transaction results in a direct payment to the Validator's coinbase address. These Builder-specified bids are separate from the gas fees attached to user transactions and represent incremental value added by the Builder to increase the likelihood of block inclusion. The Company records these Builder-specified bid payments as cost of revenues, as they are a direct cost of attempting to fulfill performance obligations under the BSC block-building arrangement.

The Company also includes in cost of revenues any fees paid to third parties for assistance with infrastructure hosting, software maintenance, or other operational support. These direct expenses are collectively presented as 'Blockchain infrastructure expenses' in the consolidated statements of operations.

The following table further details the costs of revenues for the three and six months ended June 30, 2025 and 2024.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months<br> Ended June 30,** | **For the Three Months<br> Ended June 30,** | **For the Six Months<br> Ended June 30,** | **For the Six Months<br> Ended June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Cost of staking revenues (NodeOps) | $13255 | $47414 | $60021 | $99367 |
| Cost of block-building revenues (Builder+) | 2839878 | 121434 | 4361771 | 230106 |
| **Total cost of revenues** | $**2853133** | $**168848** | $**4421792** | $**329473** |

---

*Internally Developed Software*

Internally developed software consists of the core technology of the Company's StakeSeeker and ChainQ platforms. For internally developed software, the Company uses both its own employees as well as the services of external vendors and independent contractors. The Company accounts for computer software used in the business in accordance with ASC 985-20 and ASC 350.

ASC 985-20, *Software-Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed,* requires that software development costs incurred in conjunction with product development be charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs must be capitalized and reported at the lower of unamortized cost or net realizable value of the related product. Some companies use a "tested working model" approach to establishing technological feasibility (i.e., beta version). Under this approach, software under development will pass the technological feasibility milestone when the Company has completed a version that contains essentially all the functionality and features of the final version and has tested the version to ensure that it works as expected.

ASC 350, *Intangibles-Goodwill and Other*, requires computer software costs associated with internal use software to be charged to operations as incurred until certain capitalization criteria are met. Costs incurred during the preliminary project stage and the post-implementation stages are expensed as incurred. Certain qualifying costs incurred during the application development stage are capitalized as property, equipment and software. These costs generally consist of internal labor during configuration, coding, and testing activities. Capitalization begins when (i) the preliminary project stage is complete, (ii) management with the relevant authority authorizes and commits to the funding of the software project, and (iii) it is probable both that the project will be completed and that the software will be used to perform the function intended.

*Property and Equipment*

Property and equipment consists of computers, equipment and office furniture and fixtures, all of which are recorded at cost. Depreciation and amortization are recorded using the straight-line method over the respective useful lives of the assets ranging from three to five years. Long-lived assets are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable.

*Use of Estimates*

The accompanying consolidated financial statements have been prepared in conformity with U.S. GAAP. This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period. The Company's significant estimates and assumptions include the recoverability and useful lives of indefinite life intangible assets, stock-based compensation, and the valuation allowance related to the Company's deferred tax assets. Certain of the Company's estimates, including the carrying amount of the indefinite life intangible assets, could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company's estimates and could cause actual results to differ from those estimates and assumptions.

*Income Taxes*

The Company recognizes income taxes on an accrual basis based on tax positions taken or expected to be taken in its tax returns. A tax position is defined as a position in a previously filed tax return or a position expected to be taken in a future tax filing that is reflected in measuring current or deferred income tax assets and liabilities. Tax positions are recognized only when it is more likely than not (i.e., likelihood of greater than 50%), based on technical merits, that the position would be sustained upon examination by taxing authorities. Tax positions that meet the more likely than not threshold are measured using a probability-weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's consolidated financial statements or tax returns. A valuation allowance is established to reduce deferred tax assets if all, or some portion, of such assets will more than likely not be realized. Should they occur, the Company's policy is to classify interest and penalties related to tax positions as income tax expense. Since the Company's inception, no such interest or penalties have been incurred.

*Accounting for Warrants*

 

The Company accounts for the issuance of Common Stock purchase warrants issued in accordance with ASC 815, *Derivatives and Hedging*. Warrants are evaluated for liability or equity classification at the time of issuance based on the specific terms of the arrangement and settlement features.

 

Liability-Classified Warrants

Warrants are classified as liabilities when they: (i) require net cash settlement (including upon occurrence of an event outside the Company's control), or (ii)provide the counterparty with a choice of cash or share settlement, or (iii) require the issuance of registered shares and do not explicitly preclude a right to cash settlement.

In accordance with ASC 815-40, these instruments are measured at fair value upon issuance and at each subsequent reporting period, with changes in fair value recognized in the consolidated statements of operations as "Change in fair value of warrant liabilities." These warrants are classified as Level 3 liabilities within the fair value hierarchy due to the use of unobservable inputs in the valuation model (see Note 5 - *Fair Value of Financial Assets and Liabilities*).

The Company estimates the fair value of these warrants using a Black-Scholes option pricing model, with key inputs including the Company's stock price, the warrant exercise price, expected term, expected stock price volatility, risk-free interest rate, and expected dividend yield. The warrant liability is presented as a current liability on the Company's consolidated balance sheet.

Equity-Classified Warrants

The Company also issues warrants that qualify for equity classification under ASC 815-40. Warrants are classified in equity when they: (i) require physical or net-share settlement, and (ii) do not include terms that could require cash settlement outside the control of the Company, and (iii) do not include contingent provisions or other features that would cause the instruments to be classified as liabilities.

For equity-classified warrants, the Company estimates the grant-date fair value using a Black-Scholes option pricing model. The fair value is recognized in additional paid-in capital (APIC) at the time of issuance and is not subsequently remeasured. If the warrants are issued in connection with a financing transaction (e.g., convertible notes), the fair value is allocated to APIC and, when applicable, also recorded as a debt discount in accordance with ASC 470-20 and amortized over the term of the related debt instrument using the effective interest method.

Once classified in equity, these warrants remain in equity unless modified in a way that results in liability classification. These instruments are not included in the fair value measurements disclosure under ASC 820, as they are not remeasured on a recurring basis.

 

*Stock-based compensation*

The Company accounts for stock-based compensation in accordance with ASC 718, *Compensation - Stock Compensation*. ASC 718 addresses all forms of share-based payment awards including shares issued under employee stock purchase plans and stock incentive shares. Under ASC 718, awards result in a cost that is measured at fair value on the awards' grant date, based on the estimated number of awards that are expected to vest and will result in a charge to operations.

Share-based payment awards exchanged for services are accounted for at the fair value of the award on the estimated grant date.

Options

Stock options issued under the Company's long-term incentive plans are granted with an exercise price equal to no less than the fair market value of the Company's stock at the date of grant and expire up to ten years from the date of grant. These options generally vest over a one-year period.

The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value of stock-based awards represent management's best estimates and involve inherent uncertainties and the application of management's judgment.

*Expected Volatility* – The Company uses historical volatility as it provides a reasonable estimate of the expected volatility. For options granted prior to January 1, 2025, historical volatility was based on the most recent volatility of the stock price over a period equivalent to the expected term of the option. For options granted on or after January 1, 2025, historical volatility is determined using a two-year lookback period. Management selected this approach to better reflect the Company's current market conditions and exclude periods of non-representative volatility associated with significant changes in the Company's business, market conditions, and capital structure. The two-year lookback period balances capturing industry and market cycles with avoiding outdated and non-representative data.

*Risk-Free Interest Rate* – The risk-free interest rate is based on the U.S. treasury zero-coupon yield curve in effect at the time of grant for the expected term of the option.

*Expected Term* – The Company's expected term represents the weighted-average period that the Company's stock options are expected to be outstanding. The expected term is based on the expected time to post-vesting exercise of options by employees. The Company uses historical exercise patterns of previously granted options to derive employee behavioral patterns used to forecast expected exercise patterns.

*Expected Dividend* – The Company has not historically declared or paid any cash dividends on its common shares and does not plan to pay any recurring cash dividends in the foreseeable future, and, therefore, uses an expected dividend yield of zero in its valuation models.

Restricted Stock Units (RSUs)

For awards vesting upon the achievement of a service condition, compensation cost measured on the grant date will be recognized on a straight-line basis over the vesting period. Stock-based compensation expense for the market-based restricted stock units with explicit service conditions is recognized on a straight-line basis over the longer of the derived service period or the explicit service period, regardless of whether the market condition is satisfied. However, in the event that the explicit service period is not met, previously recognized compensation cost would be reversed. Market-based restricted stock units subject to market-based performance targets require achievement of the performance target as well as a service condition in order for these RSUs to vest.

The Company estimates the fair value of market-based RSUs as of the grant date and expected derived term using a Monte Carlo simulation that incorporates pricing inputs covering the period from the grant date through the end of the derived service period.

*Expected Volatility* – The Company uses historical volatility as it provides a reasonable estimate of the expected volatility. Historical volatility is based on the most recent volatility of the stock price over a period of time equivalent to the expected term of the RSUs.

*Risk-Free Interest Rate* – The risk-free interest rate is based on the U.S. treasury zero-coupon yield curve in effect at the time of grant for the expected term of the RSUs.

*Expected Term* – The Company's expected term represents the weighted-average period that the Company's RSUs are expected to be outstanding. The expected term is based on the stipulated 5-year period from the grant date until the market-based criteria are achieved. If the market-based criteria are not achieved within the five-year period from the grant date, the RSUs will not vest and shall expire.

*Vesting Hurdle Price* – The vesting hurdle prices are determined by taking the vesting Market Cap criteria divided by the shares outstanding as of the valuation dates

*Convertible Notes Payable*

Convertible notes are accounted for in accordance with ASC 470-20, *Debt with Conversion and Other Options*. Upon issuance, the Company evaluates embedded features and freestanding instruments for separate accounting. If applicable, proceeds are allocated between the debt host and any freestanding equity-classified instruments, such as warrants, using a relative fair value method. Issuance costs and any original issue discount are recorded as a reduction to the carrying amount of the debt and amortized over the term of the notes using the effective interest method. Interest expense includes both cash interest and amortization of debt discounts.

*Defi Lending Arrangements*

 

The Company accounts for borrowings under decentralized finance ("DeFi") protocols, such as Aave, in accordance with ASC 470, *Debt*. These borrowings are recognized as financial liabilities when proceeds are received and are measured at their principal amount, net of repayments. The Company classifies these borrowings as liabilities on the balance sheet under "Loan Payable – DeFi Protocol."

DeFi borrowings are collateralized by digital assets, such as Ethereum (ETH), which are deposited into protocol-specific smart contracts as interest-bearing collateral. The collateral tokens remain in the Company's wallet but are effectively restricted from transfer while borrowings remain outstanding. Although the underlying ETH is restricted and subject to liquidation risk, the Company retains both custody and beneficial ownership, and continues to recognize the ETH on its balance sheet within "Crypto Assets" in accordance with ASC 350 and ASC 805-10-25 for nonfinancial assets. Fair value measurement of the collateralized ETH follows the guidance in ASC 820. These assets are disclosed in the footnotes as restricted from use while serving as collateral.

Interest on DeFi borrowings is accrued over the borrowing term and recognized as an expense within "Interest Expense" in the consolidated statements of operations. Interest earned on collateralized ETH is recognized as "Interest Income" when realized or earned under the terms of the DeFi protocol.

*Advertising Expense*

Advertisement costs are expensed as incurred and included in marketing expenses. Advertising and marketing expenses amounted to approximately $23,000 and $28,000 for the three months ended June 30, 2025 and 2024, respectively and approximately $268,000 and $86,000 for the six months ended June 30, 2025 and 2024, respectively.

*Net Income (Loss) per Share*

Basic income (loss) per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the Company's restricted stock units, restricted common stock, options, warrants and shares issuable upon conversion of outstanding convertible notes.

In periods when the Company reports a net loss, diluted loss per share excludes the effect of all potential common shares, including those issuable upon the exercise of warrants and options, the vesting of restricted stock units and restricted common stock, and the conversion of preferred stock or convertible notes—since their inclusion would be anti-dilutive.

For the three months ended June 30, 2024 and the six months ended June 30, 2025, the Company reported net losses; therefore, all potentially dilutive securities were excluded from the computation of diluted loss per share.

For the three months ended June 30, 2025 and the six months ended June 30, 2024, the Company reported net income, and diluted net income per share reflects the inclusion of dilutive potential common shares, where applicable.

The following financial instruments were excluded from the calculation of diluted loss per share during periods of net loss, as their effect was anti-dilutive:

---

| | | |
|:---|:---|:---|
|  | **As of June 30,** | **As of June 30,** |
|  | **2025** | **2024** |
| Warrants to purchase common stock | 2614416 | 712500 |
| Options | 2661410 | 1302500 |
| Non-vested restricted stock unit awards |  | 1806373 |
| Non-vested restricted common stock | 1312301 |  |
| Shares issuable upon conversion of convertible notes | 1334679 |  |
| &nbsp;&nbsp;&nbsp;**Total** | **7922806** | **3821373** |

---

*Recent Accounting Pronouncements*

The Company continually assesses new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of such change to its Consolidated Financial Statements and assures that there are proper controls in place to ascertain that the Company's Consolidated Financial Statements properly reflect the change.

In November 2023, the FASB issued ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures* ("ASU 2023-07"). ASU 2023-07 is intended to enhance reportable segment disclosures by requiring disclosures of significant segment expenses regularly provided to the CODM, requiring disclosure of the title and position of the CODM and explanation of how the reported measures of segment profit and loss are used by the CODM in assessing segment performance and a location of resources. ASU 2023-07 is effective for the Company for annual periods beginning after December 31, 2023. The Company adopted ASU 2023-07 for the year ended December 31, 2024. As a result of the adoption, the Company expanded its disclosures in Note 11 – *Segment Information*, to present significant expenses that are included within cost of revenue, by reportable segment, which are presented to the CODM.

In December 2023, FASB issued ASU 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures*, to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 provide improvements primarily related to the rate reconciliation and income taxes paid information included in income tax disclosures. The Company is required to disclose additional information regarding reconciling items equal to or greater than five percent of the amount computed by multiplying pretax income (loss) by the applicable statutory tax rate. Similarly, the Company is required to disclose income taxes paid (net of refunds received) equal to or greater than five percent of total income taxes paid (net of refunds received). The amendments in ASU 2023-09 are effective January 1, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is currently evaluating the impacts of ASU 2023-09 on its financial statements.

In December 2024, the FASB issued ASU 2024-03, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)* ("ASU 2024-03"). ASU 2024-03 requires, in the notes to the financial statements, disclosures of specified information about certain costs and expenses specified in the updated guidance. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact the updated guidance will have on its disclosures.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.

**Note 4 – Crypto Assets**

The following table presents the Company's crypto assets held as of June 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
| **Asset** | **Tokens** | **Cost** | **Fair Market Value** |
| Ethereum (ETH) (1)(2) | 14659 | $26893611 | $36444451 |
| Cosmos (ATOM) | 355813 | 5394231 | 1458228 |
| Solana (SOL) | 7247 | 521625 | 1122321 |
| Avalanche (AVAX) | 19628 | 1179923 | 352714 |
| BNB Chain (BNB) | 68 | 48246 | 44864 |
| Rocket Pool (RPL) | 609 | 6749 | 3057 |
| **Total** |  | $**34044385** | $**39425635** |

---

(1) ETH
 holdings include 10,460
 ETH staked to validator nodes with an approximate fair market value of $26,005,000 .

(2) ETH
 holdings also include 3,903 ETH deposited as collateral for borrowings through a DeFi protocol (Aave), with a fair market value
 of approximately $9,704,000 . Although the deposited ETH remains in the Company's wallets, it is subject to protocol-enforced restrictions while the related borrowing is outstanding.

**Note 5 – Fair Value of Financial Assets and Liabilities**

The Company measures certain assets and liabilities at fair value. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability (i.e., an 'exit price') in the principal or most advantageous market in an orderly transaction between market participants at the measurement date.

Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 – Valuations based on unadjusted quoted prices in active markets for identical, unrestricted assets or liabilities that are accessible at the measurement date. Since valuations are based on quoted prices that are readily and regularly available in an active market, these valuations do not entail a significant degree of judgment.

Level 2 – Valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Valuations based on inputs that are generally unobservable and typically reflect management's estimate of assumptions that market participants would use in pricing the asset or liability.

Financial instruments, including cash and cash equivalents, accounts and other receivables, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments.

The following tables present the Company's assets and liabilities that are measured at fair value on a recurring basis and the Company's estimated level within the fair value hierarchy of those assets and liabilities as of June 30, 2025 and December 31, 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value Measured at June 30, 2025** | **Fair Value Measured at June 30, 2025** | **Fair Value Measured at June 30, 2025** | |
|  | **Balance at June 30,**<br>**2025** | **Quoted prices in active markets**<br>**(Level 1)** | **Significant<br> other<br> observable<br> inputs**<br>**(Level 2)** |<br>**Significant unobservable inputs**<br>**(Level 3)** |
| Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Crypto Assets | $39425635 | $39425635 | $- | $- |
| &nbsp;&nbsp;&nbsp;Investments | 350000 | - | - | 350000 |
| **Total Assets** | $**39775635** | $**39425635** | $**-** | $**350000** |
| Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Warrant Liabilities | $208050 | $- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | $208050 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value Measured at December 31, 2024** | **Fair Value Measured at December 31, 2024** | **Fair Value Measured at December 31, 2024** | |
|  | **Balance at December 31,**<br>**2024** | **Quoted prices in active markets**<br>**(Level 1)** | **Significant other observable inputs**<br>**(Level 2)** |<br>**Significant unobservable inputs**<br>**(Level 3)** |
| Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Crypto Assets | $36056683 | $36056683 | $- | $- |
| &nbsp;&nbsp;&nbsp;Investments | 100000 | - | - | 100000 |
| **Total Assets** | $**36156683** | $**36056683** | $**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -** | $**100000** |
| Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Warrant Liabilities | $267900 | $- | $- | $267900 |

---

The Company did not make any transfers between the levels of the fair value hierarchy during the six months ended June 30, 2025 and 2024.

*Level 3 Valuation Techniques*

Level 3 financial assets consist of private equity investments for which there is no current public market for these securities such that the determination of fair value requires significant judgment or estimation. As of June 30, 2025 and December 31, 2024, the Company's Level 3 investments were carried at the original cost of the investments, with a value of $350,000 and $100,000, respectively. The Company has elected to apply the measurement alternative under ASC 321, *Investments—Equity Securities*, for these investments.

Level 3 financial liabilities consist of the warrant liabilities for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation.

Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.

A significant decrease in volatility or a significant decrease in the Company's stock price, in isolation, would result in a significantly lower fair value measurement. Changes in the values of the warrant liabilities are recorded in "change in fair value of warrant liabilities" in the Company's consolidated statements of operations.

On March 2, 2021, the Company entered into a securities purchase agreement with certain purchasers which closed on March 4, 2021 pursuant to which the Company sold an aggregate of (i) 950,000 shares of Common Stock, and (ii) Common Stock warrants (the "Warrants") to purchase up to 712,500 shares of Common Stock for gross proceeds of $9.5 million in a private placement offering.

The Warrants require, at the option of the holder, a net-cash settlement following certain fundamental transactions (as defined in the Warrants). At the time of issuance, the Company maintained control of certain fundamental transactions and as such the Warrants were initially classified in equity. As of June 30, 2025, the Company no longer maintained control of certain fundamental transactions because it did not hold a majority of shareholder voting power. As such, the Company may be required to cash settle the Warrants if a fundamental transaction occurs which is outside the Company's control. Accordingly, the Warrants are classified as liabilities. The Warrants have been recorded at their fair value using the Black-Scholes valuation model, and will be recorded at their respective fair value at each subsequent balance sheet date. This model incorporates transaction details such as the Company's stock price, contractual terms, maturity, risk-free rates, as well as volatility.

The Warrants require the issuance of registered shares upon exercise, do not expressly preclude an implied right to cash settlement and are therefore accounted for as derivative liabilities. The Company classifies these derivative warrant liabilities on the balance sheet as a current liability.

A summary of quantitative information with respect to the valuation methodology and significant unobservable inputs used for the Company's warrant liabilities that are categorized within Level 3 of the fair value hierarchy at the date of issuance and, as of June 30, 2025 and December 31, 2024, is as follows:

---

| | | |
|:---|:---|:---|
|  | **June 30, 2025** | **December 31, 2024** |
| Risk-free rate of interest | 3.96% | 4.16% |
| Expected volatility | 159.46% | 120.67% |
| Expected life (in years) | 0.68 | 1.17 |
| Expected dividend yield |  |  |

---

The risk-free interest rate was based on rates established by the Federal Reserve Bank. For the Warrants, the Company estimates expected volatility, giving primary consideration to the historical volatility of its Common Stock. The expected volatility is calculated using the standard deviation of the Company's underlying stock price's daily logarithmic returns. The expected life of the warrants was determined by the expiration date of the warrants. The expected dividend yield was based on the fact that the Company has not historically paid dividends on its Common Stock and does not expect to pay recurring dividends on its Common Stock in the future.

The following table sets forth a summary of the changes in the fair value of the Company's Level 3 financial assets and liabilities for the six months ended June 30, 2025 that are measured at fair value on a recurring basis:

---

| | |
|:---|:---|
|  | **Fair Value of<br> Level 3 Financial<br> Assets**<br>**June 30,**<br>**2025** |
| Beginning balance | $100000 |
| &nbsp;&nbsp;&nbsp;Purchases | 250000 |
| &nbsp;&nbsp;&nbsp;Unrealized appreciation (depreciation) | - |
| Ending balance | $350000 |

---

---

| | |
|:---|:---|
|  | **Fair Value of Level 3 Financial Liabilities**<br>**June 30,**<br>**2025** |
| Beginning balance | $267900 |
| &nbsp;&nbsp;&nbsp;Fair value adjustment of warrant liabilities | (59850) |
| Ending balance | $208050 |

---

**Note 6 – Stockholders' Equity**

Common Stock

As of June 30, 2025, the Company had 975,000,000 shares of Common Stock, $0.001 par value, authorized, of which 21,968,566 shares were issued and outstanding.

*At-The-Market Offering Agreement*

On September 14, 2021, the Company entered into an At-The-Market Offering Agreement (the "ATM Agreement") with H.C. Wainwright & Co., LLC, as agent ("H.C. Wainwright"), pursuant to which the Company may offer and sell, from time-to-time, shares of the Company's Common Stock through H.C. Wainwright, as agent. Initially, the aggregate offering price of shares issuable under the ATM Agreement was $98,767,500, registered pursuant to the Company's Form S-3 registration statement that became effective in September 2021.

On October 4, 2024, a new Form S-3 registration statement became effective, increasing the total amount of securities that may be offered and sold under the base prospectus to $250,000,000.

On July 22, 2025, the Company entered into an amendment to its engagement with H.C. Wainwright in connection with a new Form S-3 registration statement filed on July 23, 2025, to register up to $2,000,000,000 of securities for future issuance (the "New Registration Statement"). The New Registration Statement was approved by the Securities and Exchange Commission ("SEC") and declared effective on August 1, 2025.

Pursuant to the July 2025 amendment, H.C. Wainwright will continue to act as the Company's exclusive sales agent for any at-the-market offerings through November 12, 2027. Under the amended terms, the Company shall pay H.C. Wainwright a commission of up to 3.0%.

All other terms and conditions of the original ATM Agreement and prior engagement letters remain in full force and effect.

During the six months ended June 30, 2025, the Company sold a total of 1,871,889 shares of Common Stock under the ATM Agreement for aggregate total gross proceeds of approximately $4,220,000 at an average selling price of $2.25 per share, resulting in net proceeds of approximately $4,079,000 after deducting commissions and other transaction costs.

As of June 30, 2025, the Company had a receivable of approximately $156,000 related to ATM sales of 161,617 shares on that date, which settled on July 1, 2025.

*Share Based Payments*

Board Compensation

The Company issues $12,500 of Common Stock to each independent director at the end of each calendar quarter, subject to continued service. The number of shares is determined based on the closing price of the Company's Common Stock on the last trading day of the applicable quarter. For the six months ended June 30, 2025, the Company issued 42,048 shares of Common Stock with a grant date fair value of approximately $75,000 to independent directors.

Performance Bonus Payments

For the six months ended June 30, 2025, the Company issued 329,110 shares of Common Stock to officers and employees as part of the payment of accrued bonus compensation for the year ended December 31, 2024. The total fair value of the shares issued was approximately $813,000 based on the Company's closing stock price on the issuance date. Of the shares issued, 33,731 were returned to net settle the issuance and pay related taxes, resulting in a net share issuance of 295,379 shares of Common Stock.

Preferred Stock

*Series V Preferred Stock*

The Company previously designated and issued 14,542,803 shares of Series V Preferred Stock ("Series V") on June 2, 2023 to shareholders of record as of May 12, 2023. The Series V: (i) is non-convertible (subject to potential conversion rights, as described below), (ii) has a 20% liquidation preference over the shares of Common Stock, (iii) is non-voting, and (iv) has certain rights to dividends and distributions (at the discretion of the Board of Directors).

On September 6, 2024, at the Company's 2024 Annual Meeting, stockholders approved an amendment to the Series V Certificate of Designation granting the Board the discretion to convert each share of Series V into one share of Common Stock. As of June 30, 2025, the Board has not filed the amendment or elected to convert any Series V shares.

For the six months ended June 30, 2025, the Company issued 1,020,834 restricted shares of Series V in connection with the vesting of employee restricted stock units ("RSUs"). These restricted shares remain subject to forfeiture if specified market capitalization thresholds are not achieved within the applicable performance measurement period. Of this amount, 166,668 shares are also subject to time-based vesting conditions requiring continued service over the vesting period.

On February 3, 2025, 49,327 restricted shares of Series V were forfeited following the resignation of the Company's Chief Technology Officer. These shares were returned to the Company and are no longer outstanding.

As of June 30, 2025, a total of 1,069,801 restricted shares of Series V Preferred Stock were issued and outstanding. Of these, 48,967 shares remain subject solely to time-based vesting conditions, which extend over a one- to three-year period, with full vesting expected by December 31, 2027.

2021 Equity Incentive Plan

The Company's 2021 Equity Incentive Plan (the "2021 Plan") was effective on January 1, 2021 and approved by shareholders on June 30, 2021 and amended on June 13, 2022. The Company received shareholder approval on July 11, 2023 to increase the authorized amount under the 2021 Plan from 7,000,000 shares to 12,000,000 shares.

*Options*

A summary of stock option activity under the Company's 2021 Equity Incentive Plan for the six months ended June 30, 2025 and 2024 is presented below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number<br> of<br> Shares** | **Weighted Average Exercise Price** | **Total Intrinsic Value** | **Weighted Average Remaining Contractual Life (in years)** |
| Options outstanding as of December 31, 2024 | 1302500 | $1.96 | $804300 | 1.7 |
| &nbsp;&nbsp;&nbsp;Employee options granted | 1477068 | 2.43 |  | 6.3 |
| &nbsp;&nbsp;&nbsp;Employee options expired | (68158) | 2.47 |  |  |
| &nbsp;&nbsp;&nbsp;Employee options forfeited | (50000) | 1.40 | - | - |
| Options outstanding as of June 30, 2025 | 2661410 | $2.22 | $475750 | 3.8 |
| Options vested and exercisable as of June 30, 2025 | 2425160 | $2.24 | $372913 | 3.8 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number<br> of<br> Shares** | **Weighted Average Exercise Price** | **Total Intrinsic Value** | **Weighted Average Remaining Contractual Life (in years)** |
| Options outstanding as of December 31, 2023 | 1200000 | $2.12 | $8700 | 2.4 |
| &nbsp;&nbsp;&nbsp;Employee options granted | 120000 | 1.52 |  | 4.9 |
| &nbsp;&nbsp;&nbsp;Employee options expired | (17500) | 10.30 | - | - |
| Options outstanding as of June 30, 2024 | 1302500 | $1.96 | $4950 | 2.2 |
| Options vested and exercisable as of June 30, 2024 | 1127500 | $2.03 | $- | 1.8 |

---

The following weighted-average assumptions were used to estimate the fair value of options granted during the six months ended June 30, 2025 and 2024, using the Black-Scholes option pricing model:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2025** | **2024** |
| Exercise price | $2.38 | $1.55 |
| Term (years) | 6.70 | 5.00 |
| Expected stock price volatility | 113.35% | 144.57% |
| Risk-free rate of interest | 4.13% | 4.31% |

---

These assumptions are consistent with the methods described in Note 3 – *Summary of Significant Accounting Policies*.

*Restricted Stock Units (RSUs)*

Long-Term Incentive Plan (LTI) RSUs

On January 1, 2025, the Board approved the grant of 150,000 RSUs under the Company's Long-Term Incentive Plan ("LTI") to a non-officer employee. These RSUs are subject to both market capitalization and time-based vesting conditions.

The RSUs vest in three equal tranches of 50,000 RSUs each, based on the Company achieving and sustaining specific market capitalization thresholds for 30 consecutive days on or before December 31, 2026, as follows:

---

| | | |
|:---|:---|:---|
| **Market Cap Vesting Thresholds** | **Market Cap Vesting Thresholds** | **Market Cap Vesting Thresholds** |
| **$100**<br> **million** | **$150**<br> **million** | **$300**<br> **million** |
| 50000 | 50000 | 50000 |

---

Any RSUs for which the market capitalization condition is not met by December 31, 2026, will be forfeited and automatically terminate without consideration.

For any tranche in which the market capitalization condition is achieved, the RSUs remain subject to a time-based vesting schedule, with 20% of the eligible RSUs in such tranche vesting annually over five years, with the first vesting date occurring on December 31, 2025 and subsequent vesting dates occurring on December 31 of each year through 2029, provided that the grantee remains in continuous service with the Company through each applicable vesting date.

The fair value of these market-based RSUs was determined using a Monte Carlo simulation and totaled approximately $181,000 as of the grant date. The following assumptions were used to determine fair value as of the grant date, January 1, 2025:

---

| | |
|:---|:---|
|  | **January 1, 2025** |
| Vesting Hurdle Price | $5.26 - $15.79 |
| Term (years) | 2.00 |
| Expected stock price volatility | 92.70% |
| Risk-free rate of interest | 4.25% |

---

The Company will recognize compensation expense for these RSUs over the requisite service period, subject to acceleration upon meeting the market capitalization criteria.

Accelerated Vesting of RSUs and Conversion to Restricted Common Stock

On January 13, 2025, the Company accelerated the vesting of all previously outstanding long-term incentive ("LTI") restricted stock units ("RSUs"), totaling 1,170,834 RSUs granted to executive officers and employees. These RSUs were settled through the issuance of restricted shares of Common Stock. Because a portion of these RSUs were entitled to the previously declared Series V preferred stock dividend, 1,020,834 restricted shares of Series V were also issued.

The restricted shares of Common Stock and Series V preferred stock issued upon acceleration remain subject to the original market capitalization-based performance conditions and applicable time-based vesting schedules, which range from one to five years.

Forfeitures of LTI RSUs and Restricted Shares of Common Stock

On February 3, 2025, upon the voluntary resignation of the Company's Chief Technology Officer, 120,137 unvested LTI RSUs and 129,327 restricted shares of Common Stock were forfeited in accordance with the terms of the applicable award agreements. In accordance with ASC 718, *Compensation—Stock Compensation*, the Company reversed approximately $262,000 of previously recognized stock-based compensation expense during the three months ended June 30, 2025. No further expense will be recognized for these forfeited awards.

RSU Activity Summary

The following table summarizes RSU activity under the 2021 Plan for the six months ended June 30, 2025:

---

| | | |
|:---|:---|:---|
|  | **Number of<br> Restricted <br> Stock Units** | **Weighted <br> Average Grant<br> Date Fair Value** |
| Nonvested as of December 31, 2024 | 1140971 | $3.27 |
| &nbsp;&nbsp;&nbsp;Granted | 150000 | 2.47 |
| &nbsp;&nbsp;&nbsp;Vested |  |  |
| &nbsp;&nbsp;&nbsp;Vested and converted to restricted common shares | (1170834) | 3.05 |
| &nbsp;&nbsp;&nbsp;Forfeited | (120137) | 4.37 |
| Nonvested as of June 30, 2025 | - | $- |

---

Restricted Shares of Common Stock Activity Summary

The following table summarizes restricted Common Stock activity under the 2021 Plan for the six months ended June 30, 2025:

---

| | |
|:---|:---|
|  | **Number of**<br> **Restricted Shares**<br> **of Common Stock** |
| Outstanding and nonvested as of December 31, 2024 | 270794 |
| &nbsp;&nbsp;&nbsp;Converted from restricted stock units | 1170834 |
| &nbsp;&nbsp;&nbsp;Forfeited | (129327) |
| Outstanding and nonvested as of June 30, 2025 | 1312301 |

---

*Stock Based Compensation*

Stock-based compensation expenses are allocated among general and administrative expenses, compensation expenses and cost of revenues. Stock-based compensation expense for the six months ended June 30, 2025 and 2024 was as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended June 30,** | **For the Three Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Employee stock option awards | $55523 | $22712 | $110735 | $31993 |
| Employee restricted stock unit awards | 153647 | 241752 | 305604 | 480898 |
| Forfeiture of employee restricted stock unit and share awards |  |  | (262058) |  |
| Non-employee restricted stock awards | 37501 | 35578 | 75004 | 60580 |
|  | $**246671** | $**300042** | $**229285** | $**573471** |

---

Stock Purchase Warrants

The following is a summary of warrant activity for the three months ended June 30, 2025:

---

| | | |
|:---|:---|:---|
|  | **Number of**<br> **Warrants** | **Number of**<br> **Warrants** |
| Outstanding as of December 31, 2024 |  | 712500 |
| Issuance of warrants in connection with convertible note | | 1,901,916 |
| Outstanding as of June 30, 2025 |  | 2614416 |

---

As of June 30, 2025, 712,500 warrants were classified as derivative liabilities, and 1,901,916 warrants issued in connection with the convertible notes were classified as equity.

**Note 7 – Debt**

Loan Payable – Defi Protocol (Aave)

The Company participates in decentralized finance ("DeFi") borrowing activity through Aave, a smart-contract based protocol that facilitates loans collateralized by crypto assets. During the six months ended June 30, 2025, the Company borrowed an aggregate of $5,447,000 in USDT and repaid $1,447,000 of principal. These borrowings are collateralized by Ethereum (ETH) and remain outstanding until repaid or liquidated in accordance with Aave protocol terms. Borrowings have no fixed maturity date and are subject to partial or full liquidation if the loan's health factor falls below the protocol-defined minimum threshold. The health factor is calculated based on the value of the collateral relative to the loan balance and Aave's protocol-specific liquidation threshold (generally 80% for ETH).

The following table summarizes the Defi protocol lending activity during the six months ended June 30, 2025:

---

| | |
|:---|:---|
|  | **For the Six Months Ended<br> June 30, 2025** |
| Beginning balance – January 1, 2025 | $- |
| Proceeds from DeFi borrowings | 5447000 |
| Repayments of principal | (1447000) |
| Ending balance – June 30, 2025 | $**4000000** |

---

As of June 30, 2025, the Company had approximately 3,903 ETH deposited as collateral with a fair market value of approximately $9,704,000. The collateralized ETH remains in the Company's wallets but is restricted from transfer while the loan is outstanding. See Note 3 – *Summary of Significant Accounting Policies* and Note 4 – *Crypto Assets* for further detail regarding the accounting treatment and classification of these assets.

The loan accrues interest at variable rates determined by Aave's on-chain smart contracts, which adjust dynamically based on market utilization and liquidity conditions. These rates are published and updated in real-time at aave.com, and the net cost of capital may fluctuate based on protocol-level market conditions.

For the three and six months ended June 30, 2025, the Company recognized approximately $8,000 in interest expense, of which approximately $7,000 remained unpaid and is included in accrued expenses as of period end. The Company also earned approximately $1,000 of interest income on the ETH collateral during the same period.

The Company's Board of Directors has approved the use of Aave for borrowing activities, subject to a maximum loan-to-value (LTV) ratio and debt-to-asset (DTA) coverage limitation of 40% at the time of borrowing. The Board also approved temporary exceedances of these limitations for operational purposes, provided such exceedances do not exceed two days.

Convertible Notes Payable

On May 13, 2025, the Company entered into a Securities Purchase Agreement (the "SPA") with three accredited investors (the "Investors"), pursuant to which it issued 5% Original Issue Discount Senior Secured Convertible Notes (the "Notes") with an aggregate principal amount of $7,810,526 in exchange for gross cash proceeds of $7,420,000. In connection with the issuance of the Notes, the Company also agreed to issue to the Investors 1,901,916 warrants, each exercisable for one share of the Company's Common Stock at an exercise price of $2.75 per share. The warrants have a term of five years from the issuance date.

The Notes: (i) are convertible into shares of the Company's Common Stock at a conversion price of $5.85 per share, (ii) mature 24 months from the issuance date, (iii) accrue interest at an annual rate of 6%, payable quarterly in either cash or freely tradable shares at the Company's discretion, (iv) contain a 4.99% beneficial ownership conversion blocker, and (v) are secured by all of the Company's assets as collateral, excluding ETH deposited as collateral for USDT borrowings through Aave and certain other customary carve-outs.

H.C. Wainwright & Co., LLC acted as the Company's exclusive placement agent in connection with the offering. The Company paid legal, placement agent, and administrative issuance costs of approximately $236,000, which were allocated between the debt and warrant components and recorded as a debt discount to be amortized using the effective interest method over the term of the Notes.

The fair value of the warrants issued in connection with the offering was estimated using the Black-Scholes option pricing model and allocated as a debt discount in accordance with ASC 470-20, as the warrants were determined to be freestanding equity-classified instruments.

The Notes include a debt discount representing the original issue discount, issuance costs, and the allocated fair value of the freestanding warrants, which will be amortized over the term of the Notes using the effective interest method.

In connection with the transaction, Mr. Charles Allen, the Company's Chairman of the Board and Chief Executive Officer, invested $95,000 in the Offering. Additionally, a trust of which Mr. Allen is a beneficiary but is not the settlor or trustee invested $200,000 in the Offering. An independent committee of the Company's Board of Directors approved Mr. Allen's investment in the Offering.

For the three and six months ended June 30, 2025, the Company recognized total interest expense of approximately $213,000, which includes both contractual interest and the amortization of debt discounts and issuance costs using the effective interest method. The Company paid interest of approximately $62,000 in cash during the period.

**Note 8 – Accrued Expenses**

Accrued expenses consist of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30, 2025** | **December 31, 2024** |
| Accrued compensation | $621017 | $3907091 |
| Accrued interest | 6621 |  |
| Accounts payable and accrued expenses | 102607 | 70444 |
|  | $**730245** | $**3977535** |

---

Accrued compensation includes performance bonus accruals of approximately $617,000 and $3,907,000 as of June 30, 2025 and December 31, 2024, respectively. The significant decrease in bonus accruals reflects bonus payments made during the first quarter of 2025.

**Note 9 – Employee Benefit Plans**

The Company maintains defined contribution benefit plans under Section 401(k) of the Internal Revenue Code covering substantially all qualified employees of the Company (the "401(k) Plan"). Under the 401(k) Plan, the Company may make discretionary contributions of up to 100% of employee contributions. For the six months ended June 30, 2025 and 2024, the Company made contributions to the 401(k) Plan of $122,000 and $109,000, respectively.

**Note 10 – Liquidity**

The Company follows "*Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern*". The Company's consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.

As reflected in the consolidated financial statements, the Company has historically incurred a net loss and has an accumulated deficit of approximately $153,335,000 at June 30, 2025, and net cash used in operating activities of approximately $3,236,000 for the reporting period then ended. The Company is actively implementing its business plan, generating revenue, and executing a deliberate financing strategy that includes DeFi protocol borrowing and convertible note issuances to accelerate the accumulation of Ethereum (ETH) and scale its blockchain infrastructure operations. Based on the Company's cash position and liquid crypto assets as of August 12, 2025, management has determined that these resources are sufficient to support its daily operations over the next twelve months.

**Note 11 – Segment Information**

The Company operates as a single reportable segment focused on blockchain infrastructure, which consists of two primary revenue-generating activities: Validator Node Operations ("NodeOps") and Ethereum Block Building ("Builder+"). NodeOps includes revenue generated from staking rewards earned by BTCS's own proof-of-stake crypto assets, as well as validator fees collected from third-party delegations. Builder+ generates revenue from gas fees embedded in successfully finalized Ethereum blocks constructed by the Builder.

Gross profit (loss) is the primary segment performance measure reviewed by the CODM for operational and capital allocation decisions.

The following tables present segment revenue and gross profit (loss), including the significant expense items reviewed by the CODM, for the three and six months ended June 30, 2025 and 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30, 2025** | **For the Three Months Ended<br> June 30, 2025** | **For the Three Months Ended<br> June 30, 2025** | **For the Six Months Ended<br> June 30, 2025** | **For the Six Months Ended<br> June 30, 2025** | **For the Six Months Ended<br> June 30, 2025** |
|  | **NodeOps** | **Builder+** | **Total** | **NodeOps** | **Builder+** | **Total** |
| Revenues from blockchain infrastructure operations | $262972 | $2509226 | $2772198 | $602263 | $3858870 | $4461133 |
| *Less: Cost of Revenues* |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Validator Payments |  | 2813438 | 2813438 |  | 4293380 | 4293380 |
| &nbsp;&nbsp;&nbsp;Cloud and server hosting costs | 4385 | 15207 | 19592 | 40038 | 45497 | 85535 |
| &nbsp;&nbsp;&nbsp;Compensation costs | 7508 | 11233 | 18741 | 17336 | 22894 | 40230 |
| &nbsp;&nbsp;&nbsp;Third-party contractor support costs | 1362 | - | 1362 | 2647 | - | 2647 |
| **Gross profit (loss)** | $**249717** | $**(330652)** | $**(80935)** | $**542242** | $**(502901)** | $**39341** |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30, 2024** | **For the Three Months Ended<br> June 30, 2024** | **For the Three Months Ended<br> June 30, 2024** | **For the Six Months Ended<br> June 30, 2024** | **For the Six Months Ended<br> June 30, 2024** | **For the Six Months Ended<br> June 30, 2024** |
|  | **NodeOps** | **Builder+** | **Total** | **NodeOps** | **Builder+** | **Total** |
| Revenues from blockchain infrastructure operations | $485339 | $75853 | $561192 | $903692 | $108886 | $1012578 |
| &nbsp;&nbsp;&nbsp;*Less: Cost of Revenues* |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Validator Payments |  | 92500 | 92500 |  | 158112 | 158112 |
| &nbsp;&nbsp;&nbsp;Cloud and server hosting costs | 31927 | 13737 | 45664 | 73304 | 46255 | 119559 |
| &nbsp;&nbsp;&nbsp;Compensation costs | 6825 | 14656 | 21481 | 13650 | 24553 | 38203 |
| &nbsp;&nbsp;&nbsp;Third-party contractor support costs | 8662 | 541 | 9203 | 12413 | 1186 | 13599 |
| **Gross profit (loss)** | $**437925** | $**(45581)** | $**392344** | $**804325** | $**(121220)** | $**683105** |

---

The following table reconciles total segment gross profit to consolidated net income (loss):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** <br> **June 30,** | **For the Three Months Ended** <br> **June 30,** | **For the Six Months Ended** <br> **June 30,** | **For the Six Months Ended** <br> **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Gross profit | (80935) | 392344 | 39341 | 683105 |
| Total operating expenses | (4447069) | (1319374) | (7530370) | (2456216) |
| Other income (expense) | 8409536 | (5800839) | (5896136) | 7301828 |
| &nbsp;&nbsp;&nbsp;**Net income (loss)** | $**3881532** | $**(6727869)** | $**(13387165)** | $**5528717** |

---

**Note 12 – Subsequent Events**

The Company evaluates events that have occurred after the balance sheet date but before the consolidated financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements other than disclosed.

ATM Financing

During the period from July 1, 2025 to August 12, 2025, the Company sold a total of 24,522,525 shares of Common Stock under the ATM Agreement for aggregate total gross proceeds of approximately $135,217,000 at an average selling price of $5.51 per share, resulting in net proceeds of approximately $131,082,000 after deducting commissions and other transaction costs.

DeFi Borrowing

During the period from July 1, 2025 to August 12, 2025 the Company borrowed an additional $47,500,000 in USDT through Aave, a decentralized finance protocol, using Ethereum (ETH) as collateral. As of August 12, 2025, the Company had approximately $51,702,000 in outstanding borrowings, inclusive of accrued interest, collateralized by approximately 38,400 ETH with a fair market value of approximately $176,062,000, based on the ETH closing price of $4,584 on that date.

Borrowings accrue interest at variable rates determined by Aave's on-chain smart contracts, which adjust dynamically based on protocol liquidity and market demand. ETH collateral posted also accrues variable interest. These rates are published and updated in real-time at aave.com, and the net cost of capital may fluctuate based on protocol-level market conditions.

Convertible Notes Payable

On July 21, 2025, the Company entered into a Securities Purchase Agreement (the "SPA") with two accredited investors (collectively the "Investors"), pursuant to which the Company will issue to the Investors 5% Original Issue Discount Senior Secured Convertible Notes (the "Notes") in an aggregate principal amount of $10,050,000, for a purchase price of $9,547,500. In connection with the issuance of the Notes, the Company also agreed to issue 879,375 five-year warrants ("Warrants") to the investors, exercisable at $8.00 per share (collectively, the "Offering").

The Notes: (i) are convertible into shares of the Company's Common Stock at a conversion price of $13.00 per share, (ii) mature 24 months from the closing date, (iii) accrue an interest rate of 6% per annum, which may be paid on a quarterly basis in cash or freely tradable shares, (iv) contain a 4.99% beneficial ownership conversion limitation, and (v) are secured by all of the Company's assets as collateral, except for Ethereum deposited as collateral for USDT borrowings on Aave and certain other exclusions.

A trust of which Mr. Charles Allen, the Company's Chairman of the Board and Chief Executive Officer, is a beneficiary but is not the settlor or trustee invested $47,500 in the Offering.

As part of the July 21, 2025 Senior Secured Convertible Note financing terms, the Company agreed that, while the notes remain outstanding, it will not amend the Series V Preferred Shares to allow for conversion into Common Stock for a period of 18 months.

<u>Option and Warrant Exercises</u>

Subsequent to June 30, 2025, the Company issued an aggregate of 1,561,687 shares of Common Stock in connection with the cashless exercise of outstanding stock options and warrants. On July 9, 2025, holders exercised 1,100,000 stock options on a cashless basis, surrendering 353,637 options to cover the exercise price and receiving 746,363 net shares. On July 8, 2025, holders exercised 913,150 warrants on a cashless basis, surrendering 406,337 warrants and receiving 506,813 net shares. On July 18, 2025, holders exercised 456,575 warrants on a cashless basis, surrendering 148,064 warrants and receiving 308,511 net shares. No cash proceeds were received in connection with these exercises.

<u>Vesting of Certain Long-Term Incentives</u>

On August 7, 2025, the Company determined that the market capitalization vesting condition for certain previously granted Long-Term Incentive ("LTI") awards had been satisfied. Under the applicable award agreements, vesting required the Company to maintain a market capitalization in excess of $100 million for 30 consecutive days.

As a result, 318,055 shares of Common Stock and 318,055 shares of Series V Preferred Stock, originally issued on January 13, 2025, upon conversion of vested RSUs into restricted equity, became fully vested in accordance with their terms. These shares, previously classified as restricted Common Stock and restricted Series V Preferred Stock, were reclassified to outstanding Common Stock and Series V Preferred Stock, respectively.

<u>Grant of Stock Options for Achievement of Performance Milestone</u>

On August 7, 2025, upon the recommendation of the Compensation Committee, the Board of Directors of the Company determined that it had exceeded the highest level tier for the liquidity milestone under its 2025 Annual Performance Incentive Plan, which was previously disclosed in the Company's Current Report on Form 8-K filed on January 2, 2025 (the "January 8-K").

Specifically, the Company maintained a cash and crypto balance in excess of $75 million for twenty consecutive days, thereby satisfying the highest tier (cutoff level being $75 million) of the liquidity milestone. As disclosed in the January 8-K, this liquidity milestone accounts for 25% of each executive officer's target incentive compensation and is designed to reward financial strength and liquidity.

In accordance with the plan and consistent with the Company's pay-for-performance philosophy, the Board approved the payment of this performance-based award to all eligible employees in the form of non-qualified stock options under the Company's equity incentive plan. The Company's Chief Executive Officer and Chief Financial Officer were granted 169,232 and 81,613, respectively. These options: (i) have a term of seven years, (ii) have an exercise price equal to $4.20 per share, (iii) vest in full on December 31, 2026, and (iv) are subject to the terms and conditions set forth in the applicable award agreements.

**ITEM 2 Management's Discussion and Analysis of Financial Condition and Results of Operations .**

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our historical financial statements and the notes to those statements that appear elsewhere in this report. Certain statements in the discussion contain forward-looking statements based upon current expectations that involve risks and uncertainties, such as plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those discussed in the Risk Factors contained in our Annual Report on Form 10-K for the year ended December 31, 2024. When we refer to the "2025 Quarter" and the "2024 Quarter" we are referring to the three months ended June 30, 2025 and June 30, 2024, respectively. When we refer to the "2025 Period" and the "2024 Period" we are referring to the six months ended June 30, 2025 and June 30, 2024, respectively.

***Company Overview***

BTCS Inc. ("BTCS" or the "Company"), short for Blockchain Technology Consensus Solutions, is a publicly traded, Ethereum-first blockchain infrastructure and digital asset treasury company committed to driving scalable revenue and ETH accumulation through its unique capital formation and blockchain infrastructure strategies, collectively referred to as the DeFi/TradFi Flywheel. By combining decentralized finance ("DeFi") and traditional finance ("TradFi") mechanisms with its blockchain infrastructure operations, comprising NodeOps (staking) and Builder+ (block building), BTCS provides leveraged exposure to Ethereum (ETH) by integrating scalable revenue generation with a structured, yield-focused ETH accumulation strategy.

DeFi/TradFi Flywheel Funding Strategy

The DeFi/TradFi Flywheel represents a transformative extension of BTCS's Ethereum-first strategy, combining innovative financing mechanisms from both decentralized and traditional markets to optimize capital efficiency and grow its ETH treasury. The Company's planned capital formation approach includes At-The-Market ("ATM") equity offerings, above market convertible debt issuance, and on-chain borrowing through DeFi protocols, such as Aave. These capital sources are strategically aligned with BTCS's operating infrastructure, staking rewards from NodeOps, and ETH transaction fees captured through Builder+, creating a self-reinforcing flywheel designed to increase ETH per share while minimizing shareholder dilution. This approach reflects BTCS's commitment to revenue scalability, ETH accumulation, and capital stewardship.

Blockchain Infrastructure: NodeOps (staking) and Builder+ (block building)

*NodeOps:* BTCS operates Ethereum validator nodes through its NodeOps initiative, earning ETH-denominated staking rewards for securing the network.

*Builder+:* BTCS's proprietary block builder, Builder+, constructs and submits optimized blocks to Ethereum's blockchain. By leveraging algorithmic strategies, Builder+ competes in the decentralized block space marketplace to capture ETH-denominated transaction fees. It is designed for scalable revenue generation, and its architecture allows for efficient deployment across select EVM-compatible ecosystems, such as Binance Smart Chain ("BSC"). This enables BTCS to expand its infrastructure footprint and generate additional revenue while maintaining a core focus on ETH accumulation. Builder+ is a central driver of BTCS's growth strategy, reflecting the Company's emphasis on scalable and efficient revenue generation.

Streamlined Focus

BTCS has paused further development of its consumer-facing platform ChainQ. Additionally, during the six months ended June 30, 2025, BTCS completed the wind-down of staking-as-a-service and validator operations on Avalanche (AVAX), Cosmos (ATOM), Akash (AKT), and Kava (KAVA), and liquidated the majority of its alt-coin holdings, which also included Axie Infinity (AXS) and NEAR protocol (NEAR). These moves were part of a strategic focus to concentrate on Ethereum-based revenue and ETH accumulation.

***Crypto Assets***

The tables below detail BTCS's quarterly crypto asset holdings for each quarter from Q1 2024 through Q1 2025.

Crypto Assets Held as of the End of the Following Calendar Quarters:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | 7935 | 7978 | 9060 | 9063 | 14659 |
| Cosmos (ATOM) | 293886 | 307489 | 322547 | 338838 | 355813 |
| Solana (SOL) | 6821 | 6936 | 7038 | 7155 | 7247 |
| Avalanche (AVAX) | 18510 | 18510 | 19085 | 19375 | 19628 |
| BNB Chain (BNB) |  |  |  | 69 | 68 |
| Rocket Pool (RPL) |  | 584 | 599 | 609 | 609 |
| Axie Infinity (AXS) | 71704 | 77500 | 83546 | 89864 |  |
| NEAR Protocol (NEAR) | 82867 | 84748 | 86650 | 88682 |  |
| Akash (AKT) | 129891 | 136042 | 142090 | 148045 |  |
| Kava (KAVA) | 358318 | 365364 | 372126 | 379137 |  |
| Kusama (KSM) | 8074 | 8362 | 8440 |  |  |
| Polkadot (DOT) | 9386 | 9784 | 9904 |  |  |
| Polygon (POL) | 518554 | 525405 |  |  |  |
| Cardano (ADA) | 268582 | 270264 |  |  |  |
| Mina (MINA) | 95777 | 96497 |  |  |  |
| Tezos (XTZ) | 26845 | 27440 |  |  |  |
| Evmos (EVMOS) | 364037 | 367358 |  |  |  |
| Band Protocol (BAND) | 992 | 992 |  |  |  |

---

Fair Market Value of Crypto Assets as of the End of the Following Calendar Quarters:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | $27235107 | $20767299 | $30198638 | $16529501 | 36444451 |
| Cosmos (ATOM) | 1975032 | 1452240 | 1995181 | 1482550 | 1458228 |
| Solana (SOL) | 999138 | 1058786 | 1329855 | 891270 | 1122321 |
| Avalanche (AVAX) | 542525 | 513465 | 678454 | 363863 | 352714 |
| BNB Chain (BNB) |  |  |  | 41493 | 44864 |
| Rocket Pool (RPL) |  | 6702 | 6779 | 2673 | 3057 |
| Axie Infinity (AXS) | 434956 | 390911 | 517820 | 262942 |  |
| NEAR Protocol (NEAR) | 438780 | 448572 | 424934 | 222326 |  |
| Akash (AKT) | 466154 | 376836 | 396659 | 172546 |  |
| Kava (KAVA) | 158376 | 131275 | 164889 | 164408 |  |
| Kusama (KSM) | 191929 | 167245 | 277773 |  |  |
| Polkadot (DOT) | 58218 | 43406 | 65701 |  |  |
| Polygon (POL) | 290027 | 208271 |  |  |  |
| Cardano (ADA) | 105270 | 100930 |  |  |  |
| Mina (MINA) | 51720 | 53749 |  |  |  |
| Tezos (XTZ) | 21296 | 19309 |  |  |  |
| Evmos (EVMOS) | 11249 | 7310 |  |  |  |
| Band Protocol (BAND) | 1221 | 1216 | - | - | - |
| **Total** | $**32980998** | $**25747522** | $**36056683** | $**20133572** | $**39425635** |
| &nbsp;&nbsp;&nbsp;*QoQ Change* | *-15 %* | *-22 %* | *40 %* | *-44 %* | *96 %* |
| &nbsp;&nbsp;&nbsp;*YoY Change* | *70 %* | *56 %* | *43 %* | *-48 %* | *20 %* |

---

Prices of Crypto Assets as of the End of the Following Calendar Quarters:\*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | $3432 | $2603 | $3333 | $1824 | $2486 |
| Cosmos (ATOM) | 6.72 | 4.72 | 6.19 | 4.38 | 4.10 |
| Solana (SOL) | 146 | 153 | 189 | 125 | 155 |
| Avalanche (AVAX) | 29.31 | 27.74 | 35.55 | 18.78 | 17.97 |
| BNB Chain (BNB) |  |  |  | 605 | 658 |
| Rocket Pool (RPL) |  | 11.47 | 11.32 | 4.39 | 5.02 |
| Axie Infinity (AXS) | 6.07 | 5.04 | 6.20 | 2.93 |  |
| NEAR Protocol (NEAR) | 5.30 | 5.29 | 4.90 | 2.51 |  |
| Akash (AKT) | 3.59 | 2.77 | 2.79 | 1.17 |  |
| Kava (KAVA) | 0.44 | 0.36 | 0.44 | 0.43 |  |
| Kusama (KSM) | 23.77 | 20.00 | 32.91 |  |  |
| Polkadot (DOT) | 6.20 | 4.44 | 6.63 |  |  |
| Polygon (POL) | 0.56 | 0.40 |  |  |  |
| Cardano (ADA) | 0.39 | 0.37 |  |  |  |
| Mina (MINA) | 0.54 | 0.56 |  |  |  |
| Tezos (XTZ) | 0.79 | 0.70 |  |  |  |
| Evmos (EVMOS) | 0.03 | 0.02 |  |  |  |
| Band Protocol (BAND) | 1.23 | 1.23 |  |  |  |

---

\* The prices have been rounded to the nearest whole dollar for prices above $100

Crypto Asset Rewards

The tables below detail BTCS's quarterly crypto assets earned during each of the following quarters:

*Crypto assets earned from blockchain infrastructure staking activities through NodeOps*

 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | 72 | 65 | 59 | 70 | 69 |
| Cosmos (ATOM) | 12565 | 13603 | 15175 | 16313 | 16990 |
| Solana (SOL) \* | 139 | 97 | 64 | 117 | 92 |
| Axie Infinity (AXS) \* | 5772 | 5796 | 6048 | 6318 | 4569 |
| Akash (AKT) | 6246 | 6151 | 5771 | 5957 | 2272 |
| NEAR Protocol (NEAR) | 1886 | 1881 | 1960 | 2032 | 1450 |
| Avalanche (AVAX) \* | 668 |  | 569 | 290 | 253 |
| Kava (KAVA) | 6632 | 7046 | 7174 | 7011 | 4020 |
| Stader (SD) \* |  |  |  | 126 |  |
| Rocket Pool (RPL) \* |  |  | 14 | 10 |  |
| Polkadot (DOT) \* | 376 | 398 | 110 | 9 |  |
| Kusama (KSM) \* | 279 | 288 | 75 |  |  |
| Polygon (POL) \* | 6314 | 6851 | 1575 |  |  |
| Tezos (XTZ) \* | 354 | 594 | 88 |  |  |
| Cardano (ADA) \* | 2039 | 1683 |  |  |  |
| Mina (MINA) | 2880 | 720 |  |  |  |
| Evmos (EVMOS) \* | 6834 | 3321 |  |  |  |
| Oasis Network (ROSE) | 10431 |  |  |  |  |

---

\* All or a portion of revenue earned from staking to third-party validator nodes

*Crypto assets earned from block building through Builder+*

 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q2** | **2024 Q3** | **2024 Q3** | **2024 Q4** | **2024 Q4** | **2025 Q1** | **2025 Q1** | **2025 Q2** | **2025 Q2** |
| Ethereum (ETH) |  | 23 |  | 152 |  | 700 |  | 494 |  | 912 |
| BNB Chain (BNB) |  |  |  |  |  |  |  |  |  | 638 |

---

Fair Market Value of Crypto Asset Rewards Earned Recognized as Revenue

The following table summarizes the revenues earned from the Company's operations by revenue segment during the following calendar quarters:

*Revenue by Segment*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Total revenue from blockchain infrastructure staking activities through NodeOps | $485340 | $334654 | $381958 | $339291 | $262972 |
| Total revenue from block-building through Builder+ | 75852 | 404503 | 1939825 | 1349644 | 2509226 |
| &nbsp;&nbsp;&nbsp;**Total revenue** | $**561192** | $**739157** | $**2321783** | $**1688935** | $**2772198** |

---

The tables below detail the fair market value of BTCS's quarterly crypto assets earned as revenue in each respective segment during the following calendar quarters:

*Revenue from blockchain infrastructure staking activities through NodeOps*

 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | $241588 | $180487 | $182289 | $186195 | $148351 |
| Cosmos (ATOM) | 104580 | 69534 | 95552 | 84850 | 74636 |
| Solana (SOL) \* | 21353 | 14414 | 11071 | 20603 | 14184 |
| Axie Infinity (AXS) \* | 36379 | 29236 | 37711 | 18523 | 11953 |
| Akash (AKT) | 26740 | 17763 | 18043 | 11835 | 3367 |
| NEAR Protocol (NEAR) | 12500 | 8802 | 10733 | 7472 | 3826 |
| Avalanche (AVAX) \* | 18491 |  | 20764 | 6405 | 4917 |
| Kava (KAVA) | 4305 | 2508 | 3198 | 3245 | 1738 |
| Stader (SD) \* |  |  |  | 89 |  |
| Rocket Pool (RPL) \* |  |  | 170 | 34 |  |
| Polkadot (DOT) \* | 2619 | 1980 | 465 | 40 |  |
| Kusama (KSM) \* | 8108 | 5782 | 1382 |  |  |
| Polygon (POL) \* | 3758 | 2716 | 523 |  |  |
| Tezos (XTZ) \* | 338 | 419 | 57 |  |  |
| Cardano (ADA) \* | 837 | 628 |  |  |  |
| Mina (MINA) | 2439 | 319 |  |  |  |
| Evmos (EVMOS) \* | 269 | 66 |  |  |  |
| Oasis Network (ROSE) | 1036 | - | - | - | - |
| &nbsp;&nbsp;&nbsp;**Total revenue from blockchain infrastructure staking activities through NodeOps** | $**485340** | $**334654** | $**381958** | $**339291** | $**262972** |

---

\* All or a portion of revenue earned from staking to third-party validator nodes

*Revenue from block building through Builder+*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Asset** | **2024 Q2** | **2024 Q3** | **2024 Q4** | **2025 Q1** | **2025 Q2** |
| Ethereum (ETH) | $75852 | $404503 | $1939825 | $1349644 | $2101709 |
| BNB Chain (BNB) | - | - | - | - | 407517 |
| &nbsp;&nbsp;&nbsp;**Total revenue from block-building through Builder+** | $**75852** | $**404503** | $**1939825** | $**1349644** | $**2509226** |

---

***Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024***

The following tables reflect our operating results for the three and six months ended June 30, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | | |
|  | **June 30,** | **June 30,** | **$ Change** | **% Change** |
|  | **2025** | **2024** | **2025** | **2025** |
| Revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Blockchain infrastructure revenues | $2772198 | $561192 | $2211006 | 394% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 2772198 | 561192 | 2211006 | 394% |
| Cost of revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Blockchain infrastructure costs | 2853133 | 168848 | $2684285 | 1590% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | (80935) | 392344 | (473279) | (121)% |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative | 659645 | 538956 | $120689 | 22% |
| &nbsp;&nbsp;&nbsp;Research and development | 193543 | 163777 | 29766 | 18% |
| &nbsp;&nbsp;&nbsp;Compensation and related expenses | 793400 | 875491 | (82091) | (9)% |
| &nbsp;&nbsp;&nbsp;Marketing | 22861 | 28477 | (5616) | (20)% |
| &nbsp;&nbsp;&nbsp;Realized (gains) losses on crypto asset transactions | 2777620 | (287327) | 3064947 | (1067)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 4447069 | 1319374 | 3127695 | 237% |
| Other income (expenses): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 3569 |  | 3569 | 100% |
| &nbsp;&nbsp;&nbsp;Interest expense | (221894) |  | (221894) | 100% |
| &nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) of crypto assets | 8793161 | (5943339) | $14736500 | (248)% |
| &nbsp;&nbsp;&nbsp;Change in fair value of warrant liabilities | (165300) | 142500 | (307800) | (216)% |
| Total other income (expenses) | 8409536 | (5800839) | 14210375 | (245)% |
| **Net income (loss)** | $**3881532** | $**(6727869)** | $**10609401** | **(158)%** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended** | **For the Six Months Ended** | | |
|  | **June 30,** | **June 30,** | **$ Change** | **% Change** |
|  | **2025** | **2024** | **2025** | **2025** |
| Revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Validator revenue | $4461133 | $1012578 | $3448555 | 341% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 4461133 | 1012578 | 3448555 | 341% |
| Cost of revenues |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Validator expense | 4421792 | 329473 | 4092319 | 1242% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | 39341 | 683105 | (643764) | (94)% |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative | $1218033 | $1026555 | $191478 | 19% |
| &nbsp;&nbsp;&nbsp;Research and development | 402794 | 310326 | 92468 | 30% |
| &nbsp;&nbsp;&nbsp;Compensation and related expenses | 1481602 | 1331270 | 150332 | 11% |
| &nbsp;&nbsp;&nbsp;Marketing | 268033 | 86079 | 181954 | 211% |
| &nbsp;&nbsp;&nbsp;Realized (gains) losses on crypto asset transactions | 4159908 | (298014) | 4457922 | (1496)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 7530370 | 2456216 | 5074154 | 207% |
| Other income (expenses): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 3569 |  | 3569 | 100% |
| &nbsp;&nbsp;&nbsp;Interest expense | (221894) |  | (221894) | 100% |
| &nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) of crypto assets | (5737661) | 7159328 | (12896989) | (180)% |
| &nbsp;&nbsp;&nbsp;Change in fair value of warrant liabilities | 59850 | 142500 | (82650) | (58)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other income (expenses) | (5896136) | 7301828 | (13197964) | (181)% |
| **Net income (loss)** | $**(13387165)** | $**5528717** | **(18915882)** | **(342)%** |

---

*Revenues*

Revenue for the 2025 Quarter increased to approximately $2,772,000 compared to approximately $561,000 in the 2024 Quarter. The increase was primarily attributable to the continued expansion of our Builder+ operations, which focus on block-building activities across Ethereum and Binance Smart Chain (BSC).

During the 2025 Quarter, Builder+ operations contributed approximately $2,509,000 of total revenue, while our NodeOps business contributed approximately $263,000. The significant year-over-year increase in revenue reflects the continued scaling of our Builder+ operations and the commencement of Binance Smart Chain (BSC) block building, which together resulted in a substantial increase in block rewards earned during the period. Block building on BSC contributed approximately $408,000, representing approximately 16% of Builder+ revenue and 15% of overall revenue for the 2025 Quarter.

For the 2025 Period, revenue increased to approximately $4,461,000 from approximately $1,013,000 in the 2024 Period, driven by the same factors described above.

While we anticipate continued growth in both the number of block rewards and staking rewards earned due to scaling of staked ETH, the fair value of such rewards may fluctuate due to the inherent volatility of crypto asset markets. As a result, the amount of revenue recognized in future periods may be materially impacted by market price movements of the underlying crypto assets at the time of reward receipt or recognition.

*Cost of Revenues*

Cost of revenues increased during the 2025 Quarter and 2025 Period, primarily due to higher Validator Payments made to external parties to secure block space as part of our block-building activities under Builder+. Validator Payments totaled approximately $2,813,000 during the 2025 Quarter and approximately $4,293,000 during the 2025 Period.

These costs are partially offset by the efficiencies realized in our blockchain infrastructure validating operating costs, including streamlining of infrastructure hosting fees and reduction of services provided by vendors.

As we continue to expand block-building operations and increase block production, we expect cost of revenues to rise correspondingly. During the 2025 Quarter, we incurred negative gross margins, as the losses from Builder+ activities outweighed the positive gross margins from our high-margin NodeOps operations. Costs may grow at a greater rate than revenue, particularly in periods of aggressive expansion, which could further pressure gross margins.

*Operating Expenses*

General and Administrative Expenses

General and administrative expenses increased during the 2025 Quarter and 2025 Period compared to the corresponding periods in 2024. The increase was primarily attributable to higher payments for order flow associated with supporting block-building activities, expanded investor relations services, and higher accounting fees, including increases in audit fees.

The growth in general and administrative expenses reflects the Company's ongoing investment in operational infrastructure to support Builder+ activities and broader public company compliance efforts. We expect general and administrative expenses to fluctuate based on business needs, with potential increases in audit fees as well as order flow costs as operations continue to scale.

Research and Development Expenses

Research and development expenses increased during the 2025 Quarter and 2025 Period compared to the prior-year periods, primarily due to continued investment in Builder+ strategies and development. The primary focus of research and development activities remained centered on enhancing Builder+ operations, including the commencement of block building on Binance Smart Chain (BSC) during the 2025 Quarter. We expect research and development costs to remain consistent or moderately increase in future periods, with an emphasis on disciplined cost management, particularly for third-party development services.

Compensation and Related Expenses

Compensation and related expenses decreased during the 2025 Quarter but increased during the 2025 Period compared to the prior-year periods. The decrease in the Quarter was primarily attributable to timing differences in performance-based bonus accruals, while the increase in the Period reflects the addition of employee headcount and accruals for estimated performance-based bonuses tied to operational and financial milestones. The Company continues to rely on non-cash equity-based compensation as a core element of its overall compensation strategy, and we expect total compensation costs to increase in future periods as additional personnel are added and as further accruals for performance-based incentives are recognized.

Marketing Expenses

Marketing expenses increased during the 2025 Period compared to the 2024 Period, primarily due to expanded advertising campaigns and promotional activities aimed at enhancing brand visibility and supporting business development initiatives. The Company expects that marketing spend will remain at current or higher levels in future periods, in line with strategic growth objectives and broader customer engagement efforts.

Realized Losses on Crypto Asset Transactions

Realized losses on crypto asset transactions during the 2025 Quarter and 2025 Period were primarily driven by the sale of non-ETH crypto asset holdings, which the Company had held with long-standing unrealized losses that were recognized upon sale. These transactions reflect the Company's strategic exit from its non-core related operations and holdings. Additional realized gains or losses may be recognized in future periods based on the timing and pricing of crypto asset sales to support operational or liquidity needs.

*Other Income (Expenses)*

<u>Interest Income</u>

Other income (expense) for the 2025 Quarter and 2025 Period was primarily impacted by changes in the fair value of the Company's crypto assets and warrant liabilities.

Interest income earned on ETH deposited as collateral on the Aave DeFi lending protocol was a new source of other income during the 2025 Quarter. While the impact of interest income was not significant for the 2025 Quarter, we anticipate it to increase in future periods as we increase the amount of ETH deposited as collateral in connection with our planned expanded leverage on DeFi protocol lending.

<u>Interest Expense</u>

Interest expense during the 2025 Quarter and 2025 Period reflects interest accrued on borrowings under the Aave DeFi lending protocol, as well as interest incurred in connection with the issuance of the May 2025 convertible note. This includes both cash interest paid and the amortization of debt discount over the term of the convertible note.

We expect interest expense to increase significantly in future periods as we continue to utilize decentralized borrowings through platforms such as Aave, and as a result of the issuance of an additional $10,000,000 convertible note in July 2025 with terms similar to the May 2025 note.

Change in unrealized appreciation (depreciation) of crypto assets

The recognition of unrealized depreciation of crypto assets during the 2025 Period, compared to unrealized appreciation during the 2024 Period, contributed significantly to the year-over-year change. These fluctuations reflect movements in the fair market value of the Company's crypto asset holdings, which are directly influenced by the volatility of crypto markets. Market volatility remains difficult to predict and can materially affect the value of assets reported on our balance sheet and the related effects on our results of operations.

Change in fair value of warrant liabilities

Additionally, the decrease in the fair value of warrant liabilities during the 2025 Period contributed to a reduction in non-cash expense. The valuation of warrant liabilities is primarily influenced by changes in the Company's stock price as of each reporting period end, which may fluctuate based on market conditions beyond management's control.

*Net income (loss)*

Net income for the 2025 Quarter increased to approximately $3,882,000, compared to a net loss of approximately $6,728,000 in the 2024 Quarter, resulting in a year-over-year improvement of approximately $10,610,000. The improvement was primarily driven by the positive change in the fair value of the Company's crypto asset holdings, as crypto markets experienced an uptick during the 2025 Quarter. This resulted in significant unrealized gains on crypto assets, contributing substantially to the net income.

Despite this quarterly gain, the Company reported a net loss of approximately $13,387,000 for the 2025 Period, compared to net income of approximately $5,529,000 in the 2024 Period. The six-month loss reflects a carryover of unrealized depreciation recorded in the first quarter of 2025, when markets experienced notable weakness. In addition, realized losses on the sale of several non-ETH crypto asset holdings contributed to the year-to-date net loss.

Operating expenses also increased meaningfully, led by higher compensation costs, including increased performance bonus accruals tied to revenue growth and asset values, and a rise in marketing spend to support strategic growth initiatives.

Net income (loss) may continue to fluctuate significantly due to the volatility in the crypto asset markets, impacting changes in the fair value of crypto assets during future reporting periods.

***Liquidity and Capital Resources***

ATM Financing

On September 14, 2021, the Company entered into an At-The-Market Offering Agreement (the "ATM Agreement") with H.C. Wainwright & Co., LLC, as agent ("H.C. Wainwright"), pursuant to which the Company may offer and sell (assuming an effective registration statement on Form S-3), from time to time, shares of its Common Stock through H.C. Wainwright, subject to the availability of an effective registration statement on Form S-3. The initial ATM sales were conducted under a $100,000,000 shelf registration statement that became effective in September 2021.

On October 4, 2024, a new Form S-3 registration statement became effective, increasing the total amount of securities that may be offered and sold under the Company's shelf registration to $250,000,000. As of the date of this report, there was approximately $104,341,000 available for sale under this Form S-3 registration statement.

On July 22, 2025, the Company entered into an amendment to its engagement with H.C. Wainwright in connection with a new Form S-3 registration statement filed on July 23, 2025, to register up to $2,000,000,000 of securities for future issuance (the "New Registration Statement"). The New Registration Statement was approved by the SEC and declared effective on August 1, 2025. As of the date of this report, the Company had not sold any securities under the New Registration Statement.

From September 14, 2021 through August 12, 2025, the Company sold a total of 32,762,523 shares of Common Stock under the ATM Agreement for aggregate total gross proceeds of approximately $163,597,000 at an average selling price of $4.99 per share, resulting in net proceeds of approximately $158,539,000 after deducting commissions and other transaction costs.

DeFi Borrowing (Aave)

From April 2025 through August 12, 2025, the Company borrowed a total of approximately $52,947,000 in USDT through Aave, a decentralized finance protocol, using Ethereum (ETH) as collateral, and repaid approximately $1,447,000 during the same period. As of August 12, 2025, the Company had approximately $51,702,000 in outstanding borrowings, inclusive of accrued interest, collateralized by approximately 38,400 ETH with a fair market value of approximately $176,062,000, based on the ETH closing price of $4,584 on that date.

Borrowings accrue interest at variable rates determined by Aave's on-chain smart contracts, which adjust dynamically based on protocol liquidity and market demand. ETH collateral posted also accrues variable interest. These rates are published and updated in real-time at aave.com, and the net cost of capital may fluctuate based on protocol-level market conditions.

Convertible Notes Payable

In May 2025, the Company completed a private placement of Senior Secured Convertible Notes in the aggregate principal amount of approximately $7.8 million, for net cash proceeds of approximately $7.3 million. In connection with the offering, the Company also issued approximately 1.9 million five-year warrants, exercisable at $2.75 per share. The Notes mature in May 2027, bear interest at a rate of 6% per annum, and are convertible into shares of Common Stock at a conversion price of $5.85 per share.

In July 2025, the Company entered into an additional private placement of Senior Secured Convertible Notes in the aggregate principal amount of approximately $10.0 million, for net cash proceeds of approximately $9.5 million. In connection with the offering, the Company agreed to issue approximately 879,000 five-year warrants, exercisable at $8.00 per share. The Notes mature in July 2027, bear interest at 6% per annum, and are convertible into shares of Common Stock at a conversion price of $13.00 per share.

The Company intends to use the proceeds from both offerings primarily to accelerate the accumulation of Ethereum (ETH), expand operational capacity, and support the continued expansion of its blockchain infrastructure operations.

<u>Liquidit</u>y

The Company's consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.

Liquidity is the ability of a company to generate sufficient funds to support its current and future operations, satisfy its obligations as they come due, and otherwise operate on an ongoing basis. As of June 30, 2025, the Company had approximately $639,000 of cash and working capital of approximately $35,514,000.

As of August 12, 2025, subsequent to the financing described below, the Company had approximately $4,211,000 of cash and cash equivalents, and the fair market value of the Company's crypto assets was approximately $323,043,000.

As of August 12, 2025, the Company had total debt obligations of approximately $69,563,000, consisting of approximately $51,702,000 under its lending arrangement with Aave Protocol and approximately $17,861,000 convertible notes payable.

The Company believes that its existing cash and crypto assets, together with the proceeds from the convertible note financing and the ability to raise additional funds through its ATM Agreement, provide sufficient liquidity to meet working capital requirements, anticipated capital expenditures, strategic funding needs, and contractual obligations for at least the next twelve months from the filing date of this report. This assessment is based on current market conditions, regulatory environment, and the Company's operational plans, all of which are subject to change.

Certain of our staked crypto assets may be locked up for varying durations, depending on the specific blockchain protocol, and we may be unable to unstake them in a timely manner to liquidate to the extent desired, which could materially impact our liquidity position. Additionally, technical issues, network congestion, or regulatory changes could further restrict our ability to access or liquidate these assets. Lock-up periods for our staked crypto assets range from several hours to 30 days. During times of instability in the cryptocurrency markets, the Company may not be able to sell its crypto assets at prices reflecting their perceived value or at all, which could result in substantial losses given the historical volatility of cryptocurrency prices. As a result, our crypto assets may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents.

Cash Flows

*Cash Used in Operating Activities*

Cash used in operating activities was approximately $3,236,000 during the 2025 Period, compared to approximately $1,693,000 for the 2024 Period. Significant non-cash adjustments impacting operating cash flows included:

● **Positive Adjustments:**

● **Negative Adjustments:**

We expect non-cash adjustments such as Validator Payments and crypto-denominated revenue to continue growing as Builder+ operations scale across Ethereum and Binance Smart Chain. However, the magnitude of these adjustments will remain sensitive to market conditions and crypto asset price fluctuations. The use of performance-based equity compensation may continue, and given the Company's recent fundraising efforts and operational scaling, the pace of such accruals could increase in future periods.

*Cash Used in Investing Activities*

Net cash used in investing activities was approximately $13,366,000 during the 2025 Period, compared to net cash provided by investing activities of approximately $531,000 in the 2024 Period. The 2025 activity primarily reflects the purchase of approximately $14,179,000 of crypto assets, including approximately $14,130,000 of Ethereum to support validator operations and the Company's long-term accumulation strategy. The Company also invested $250,000 in a private blockchain-based technology company during the 2025 Period. These purchases were partially offset by proceeds of approximately $1,065,000 from sales of non-core productive crypto assets as we continue to streamline operations.

We expect that purchases of ETH and other productive crypto assets will continue in future periods as the Company executes on its ETH treasury accumulation and validator scaling strategies.

*Cash Provided by Financing Activities*

Cash provided by financing activities was approximately $15,263,000 during the 2025 Period, compared to approximately $240,000 in the 2024 Period. Financing inflows during the 2025 Period were primarily driven by:

● Net proceeds of approximately $7,306,000 from the May 2025 issuance of senior secured convertible notes and related five-year warrants

● Net proceeds of approximately $4,079,000 from Common Stock sales under the Company's At-the-Market ("ATM") equity program.

● Net borrowings of approximately $4,000,000 in USDT via Aave, a decentralized finance (DeFi) lending protocol.

The Company also paid debt issuance costs of approximately $123,000 during the 2025 Period.

The Company anticipates future financing activity may include additional DeFi borrowings and capital raised through the ATM program or convertible instruments, aligned with its strategy to scale blockchain infrastructure operations and accumulate ETH.

***Off Balance Sheet Transactions***

As of June 30, 2025, there were no off-balance sheet arrangements and we were not a party to any off-balance sheet transactions. We have no guarantees or obligations other than those which arise out of normal business operations.

***Critical Accounting Policies and Estimates***

We discussed the material accounting policies that are critical in making the estimates and judgments in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, under the caption "Management's Discussion and Analysis—Critical Accounting Policies and Estimates". There has been no material change in critical accounting policies or estimates during the period covered by this report.

**RECENT ACCOUNTING PRONOUNCEMENTS**

For information on recent accounting pronouncements, see Note 3 - *Summary of Significant Accounting Policies* to the Unaudited Consolidated Condensed Financial Statements.

**CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS**

This report contains forward-looking statements, including statements regarding our liquidity, our growth strategy, our ability to generate scalable and efficient revenue, anticipated increases in our revenues and gross margins, and our future business plans. Forward-looking statements can be identified by words such as "anticipates," "intends," "may," "potential," "continues," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods.

Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. The results anticipated by any or all of these forward-looking statements might not occur. Important factors that could cause actual results to differ materially from those in the forward-looking statements include: (i) the rewards and costs associated with staking or validating transactions on blockchains and successfully building blocks on Ethereum's blockchain; (ii) regulatory issues related to our business model; (iii) fluctuations in the price of our crypto assets; (iv) potential decreases in the value of our crypto assets and rewards; (v) competition, (vi) risks related to the loss or theft of private withdrawal keys resulting in the complete loss of crypto assets and rewards; and (vii) other risks and uncertainties described in our filings with the SEC, including our Form 10-K for the year ended December 31, 2024. Any forward-looking statement made by us speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

**ITEM 3 Quantitative and Qualitative Disclosures About Market Risk**

Not applicable.

**ITEM 4 Controls and Procedures**

*Evaluation of Disclosure Controls and Procedures*

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, have evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2025. Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, management concluded that our disclosure controls and procedures were effective as of June 30, 2025.

*Changes in Internal Control over Financial Reporting*

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II - OTHER INFORMATION**

**ITEM 1 Legal Proceedings**

None.

**ITEM 1A Risk Factors**

Not applicable to smaller reporting companies.

**ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds**

None.

**ITEM 3 Defaults Upon Senior Securities**

None.

**ITEM 4 Mine Safety Disclosures**

Not applicable.

**ITEM 5 Other Information**

<u>Transition of Roles for the Company's Chief Operating Officer</u>

On August 13, 2025, Michal Handerhan, the Company's Chief Operating Officer and a member of the Board, transitioned from his position as Chief Operating Officer to the role of Operations Specialist, effective August 13, 2025. Mr. Handerhan and the Company have mutually agreed to terminate his employment agreement and RSU agreements, and Mr. Handerhan's annual cash compensation will remain at $300,000 through June 30, 2026.

The transition is part of the Company's realignment in light of recent growth and was not the result of any disagreement with the Company on any matter relating to its operations, policies, or practices.

10b5-1 Plans

On June 3, 2025, Michael Prevoznik, our Chief Financial Officer, adopted a Rule 10b5-1 trading plan in accordance with the company's insider trading policies and procedures. The plan is effective as of September 2, 2025 and is scheduled to terminate on November 17, 2027, unless terminated earlier in accordance with its terms. Under the plan, up to 350,000 shares of the Company's Common Stock may be sold, subject to the terms and conditions of the plan, including price thresholds, volume limitations, and blackout periods.

No other officers, as defined in Rule 16a-1(f), or directors adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as defined in Regulation S-K Item 408, during the last fiscal quarter.

Investor Communications via X (formerly Twitter)

The Company uses the following X (formerly Twitter) accounts, @Charles_BTCS and @Nasdaq_BTCS, as supplemental channels for communicating with the public about the Company. While these channels may share news and updates that may be material to investors, investors should primarily rely on our official SEC filings and press releases for material information. The Company encourages investors, the media, and others interested in the Company to follow these accounts in addition to monitoring the Company's filings with the SEC, press releases, and its website at www.btcs.com for information about the Company. The content on our website is not incorporated by reference herein.

**ITEM 6 Exhibits**

The exhibits listed in the accompanying "Exhibit Index" are filed or incorporated by reference as part of this Form 10-Q.

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **BTCS Inc.** | **BTCS Inc.** |
| August 13, 2025 | By: | */s/ Charles Allen* |
|  |  | Charles W. Allen |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |

---

**EXHIBIT INDEX**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **Incorporated by Reference** | **Incorporated by Reference** | **Incorporated by Reference** | |
| <br>**Exhibit #** | <br>**Exhibit Description** | **Form** | **Date** | **Number** | **Filed or Furnished**<br>**Herewith** |
| 2.1 | [Articles of Merger](https://www.sec.gov/Archives/edgar/data/1436229/000149315215003295/ex3-1.htm) | 8-K/A | 7/31/15 | 3.1 |  |
| 2.2 | [Agreement and Plan of Merger](https://www.sec.gov/Archives/edgar/data/1436229/000149315215003295/ex3-2.htm) | 8-K/A | 7/31/15 | 3.2 |  |
| 3.1 | [Amended and Restated Articles of Incorporation, as of May 2010](https://www.sec.gov/Archives/edgar/data/1436229/000121390011001640/f10k2010ex3i_touchit.htm) | 10-K | 3/31/11 | 3.1 |  |
| 3.1(a) | [Certificate of Amendment to Articles of Incorporation - Increase Authorized Capital](https://www.sec.gov/Archives/edgar/data/1436229/000121390013001284/f8k032213ex3i2_touchit.htm) | 8-K | 3/25/13 | 3.1 |  |
| 3.1(b) | [Certificate of Amendment to Articles of Incorporation – Name Change and Reverse Stock Split](https://www.sec.gov/Archives/edgar/data/1436229/000121390014000651/f8k012414ex3i_bitcoinshop.htm) | 8-K | 2/5/14 | 3.1 |  |
| 3.1(c) | [Certificate of Amendment to Articles of Incorporation - Increase Authorized Capital](https://www.sec.gov/Archives/edgar/data/1436229/000121390014000651/f8k012414ex3i_bitcoinshop.htm) | 8-K | 2/5/14 | 3.1 |  |
| 3.1(d) | [Certificate of Amendment to Articles of Incorporation - Reverse Stock Split](https://www.sec.gov/Archives/edgar/data/1436229/000149315217001671/ex3-1.htm) | 8-K | 2/16/17 | 3.1 |  |
| 3.1(e) | [Certificate of Amendment to Articles of Incorporation - Reverse Stock Split](https://www.sec.gov/Archives/edgar/data/1436229/000149315219005056/ex3-1.htm) | 8-K | 4/9/19 | 3.1 |  |
| 3.1(f) | [Certificate of Change – Reverse Stock Split](https://www.sec.gov/Archives/edgar/data/1436229/000149315221020339/ex3-1.htm) | 8-K | 8/17/21 | 3.1 |  |
| 3.1(g) | [Certificate of Designation – Series V](https://www.sec.gov/Archives/edgar/data/1436229/000149315223003060/ex3-1.htm) | 8-K | 1/31/23 | 3.1 |  |
| 3.1(h) | [Certificate of Amendment to the Series V Certificate of Designation](https://www.sec.gov/Archives/edgar/data/1436229/000149315223012844/ex3-1.htm) | 8-K | 4/19/23 | 3.1 |  |
| 3.1(i) | [Certificate of Amendment to Articles of Incorporation – Increase Authorized Capital](https://www.sec.gov/Archives/edgar/data/1436229/000149315223024394/ex3-1.htm) | 8-K | 7/13/23 | 3.1 |  |
| 3.2 | [Amended and Restated Bylaws of BTCS Inc.](https://www.sec.gov/Archives/edgar/data/1436229/000149315224026336/ex3-1.htm) | 8-K | 7/5/24 | 3.1 |  |
| 4.1 | [BTCS Inc. 2021 Equity Incentive Plan, as amended](https://www.sec.gov/Archives/edgar/data/1436229/000149315223027868/ex4-1.htm) | 10-Q | 8/11/23 | 4.1 |  |
| 10.1 | [Form of Securities Purchase Agreement – May 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000164117225010103/ex10-1.htm) | 8-K | 5/14/25 | 10.1 |  |
| 10.2 | [Form of 5% OID Secured Convertible Note – May 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000164117225010103/ex10-2.htm) | 8-K | 5/14/25 | 10.2 |  |
| 10.3 | [Form of Warrant – May 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000164117225010103/ex10-3.htm) | 8-K | 5/14/25 | 10.3 |  |
| 10.4 | [Form of Securities Purchase Agreement – July 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000149315225011311/ex10-1.htm) | 8-K | 7/21/25 | 10.4 |  |
| 10.5 | [Form of 5% OID Secured Convertible Note – July 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000149315225011311/ex10-2.htm) | 8-K | 7/21/25 | 10.5 |  |
| 10.6 | [Form of Warrant – July 2025 ATW](https://www.sec.gov/Archives/edgar/data/1436229/000149315225011311/ex10-3.htm) | 8-K | 7/21/25 | 10.6 |  |
| 31.1 | [Certification of Principal Executive Officer (302)](ex31-1.htm) |  |  |  | Filed |
| 31.2 | [Certification of Principal Financial Officer (302)](ex31-2.htm) |  |  |  | Filed |
| 32.1 | [Certification of Principal Executive and Principal Financial Officer (906)](ex32-1.htm) |  |  |  | Furnished\*\* |

---

---

| | |
|:---|:---|
| 101.INS | Inline XBRL Instance Document |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |

---

\*\* This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.

Copies of this report (including the consolidated financial statements) and any of the exhibits referred to above will be furnished at no cost to our shareholders who make a written request to BTCS Inc., 9466 Georgia Avenue #124, Silver Spring, MD 20910, Attention: Corporate Secretary.

## Exhibit 31.1

**EXHIBIT 31.1**

**CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Charles Allen, certify that:

1. I
 have reviewed this quarterly report on Form 10-Q of BTCS Inc. for the fiscal quarter ended June 30, 2025.

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 consolidated financial statements, and other financial information included in this interim report, fairly present
 in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
 presented in this report;

4. I
 am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant
 and have:

&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 registrant, is made known to us by others, particularly during the period in
 which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated
 financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant'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;

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal
 control over financial reporting;

5. I
 have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors
 and the registrant's board of directors:

&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal controls over financial reporting.

---

| | | |
|:---|:---|:---|
| Dated: August 13, 2025 | By: | */s/ Charles Allen* |
|  |  | Charles Allen |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |

---

## Exhibit 31.2

**EXHIBIT 31.2**

**CERTIFICATION OF PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Michael Prevoznik, certify that:

1. I
 have reviewed this quarterly report on Form 10-Q of BTCS Inc. for the fiscal quarter ended June 30, 2025.

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 consolidated financial statements, and other financial information included in this interim report, fairly present
 in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
 presented in this report;

4. I
 am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant
 and have:

&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 registrant, is made known to us by others, particularly during the period in
 which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated
 financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant'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;

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal
 control over financial reporting;

5. I
 have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors
 and the registrant's board of directors:

&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal controls over financial reporting.

---

| | | |
|:---|:---|:---|
| Dated: August 13, 2025 | By: | */s/ Michael Prevoznik* |
|  |  | Michael Prevoznik |
|  |  | Chief Financial Officer |
|  |  | (Principal Financial Officer) |

---

## Exhibit 32.1

**EXHIBIT 32.1**

**CERTIFICATION PURSUANT TO**

**18 USC, SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report of BTCS Inc. (the "Company") on Form 10-Q for the quarter ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Charles Allen, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of Sections 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) Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
| Dated: August 13, 2025 | By: | */s/ Charles Allen* |
|  |  | Charles Allen |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |

---

A signed original of this written statement required by Section 906 has been provided to BTCS Inc. and will be retained by BTCS Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

In connection with the Quarterly Report of BTCS Inc. (the "Company") on Form 10-Q for the quarter ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Michael Prevoznik, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of Sections 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) Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
| Dated: August 13, 2025 | By: | */s/ Michael Prevoznik* |
|  |  | Michael Prevoznik |
|  |  | Chief Financial Officer |
|  |  | (Principal Financial Officer) |

---

A signed original of this written statement required by Section 906 has been provided to BTCS Inc. and will be retained by BTCS Inc. and furnished to the Securities and Exchange Commission or its staff upon request.