Crypto Co 10-Q for FY2026 Q2
Crypto Co (CRCW)
About this 10-Q
Crypto Co filed this 10-Q on August 19, 2026, covering the quarter ended June 30, 2026 (FY2026 Q2).
Headline figures
Quarter ended June 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1465
- down 65.4% from $4230 a year earlier
- Net loss
- $740.01K
- compared with a net loss of $1.01M a year earlier
- Diluted EPS
- -$0.00
- compared with -$0.00 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________ to __________
Commission
File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification No.) |
(Address of principal executive offices)
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| None | N/A | N/A |
Indicate
by check mark whether the registrant (1) has 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.
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 than the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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. (Check one):
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Smaller
reporting company | ||
| 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 Exchange Act). Yes ☐ No
As of August 18, 2026 the issuer had shares of common stock, par value $ per share, outstanding.
TABLE OF CONTENTS
| Page No. | ||
| PART I FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements | |
| Consolidated Balance Sheets as of June 30, 2026 (Unaudited) and December 31, 2025 | 4 | |
| Unaudited Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2026 and 2025 | 5 | |
| Unaudited Consolidated Statements of Stockholders’ Deficit for the Three and Six Months Ended June 30, 2026 and 2025 | 6 | |
| Unaudited Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 | 7 | |
| Notes to Unaudited Consolidated Financial Statements | 8 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 21 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 24 |
| Item 4. | Controls and Procedures | 24 |
| PART II OTHER INFORMATION | 25 | |
| Item 1. | Legal Proceedings | 25 |
| Item 1A. | Risk Factors | 25 |
| Item 3. | Defaults upon Senior Securities | 26 |
| Item 4. | Mine Safety Disclosures | 26 |
| Item 5. | Other Information | 26 |
| Item 6. | Exhibits | 27 |
| SIGNATURES | 29 | |
| 2 |
NOTE ABOUT FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements. All statements contained in this Quarterly Report other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short- term and long-term business operations, and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including those described in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Annual Report”) as filed with the U.S. Securities and Exchange Commission (“SEC”) and in any subsequent filings with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. Our management cannot predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events, and trends discussed in this Quarterly Report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Unless expressly indicated or the context requires otherwise, the terms “Crypto,” the “Company,” “we,” “us,” and “our” in these consolidated financial statements refer to The Crypto Company and, where appropriate, its wholly-owned subsidiary Blockchain Training Alliance, Inc. (“BTA”) and an inactive subsidiary Coin Tracking, LLC (“CoinTracking”).
| 3 |
THE CRYPTO COMPANY
CONSOLIDATED BALANCE SHEETS
| (Unaudited) | ||||||||
| June 30, 2026 | December 31, 2025 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Total current assets | ||||||||
| Cryptocurrency | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Other liabilities | ||||||||
| Notes payable | ||||||||
| Derivative liability | ||||||||
| Convertible debt - net of discount | ||||||||
| Total current liabilities | ||||||||
| Notes payable - other | ||||||||
| TOTAL LIABILITIES | ||||||||
| STOCKHOLDERS’ DEFICIT | ||||||||
| Preferred A voting stock, $ par value; shares authorized shares issued and outstanding as of June 30, 2026 and December 31, 2025 | ||||||||
| Common stock, $ par value; shares authorized and shares issued and outstanding, respectively, as of June 30, 2026 and December 31, 2025, respectively. | ||||||||
| Additional paid-in-capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| TOTAL STOCKHOLDERS’ DEFICIT | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited consolidated financial statements.
| 4 |
THE CRYPTO COMPANY
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue: | ||||||||||||||||
| Services | $ | $ | $ | $ | ||||||||||||
| Cost of services | ||||||||||||||||
| Gross margin | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income and (expense) | ||||||||||||||||
| (Loss) on the forgiveness or extinguishment of debt | ( | ) | ||||||||||||||
| Gain on the conversion of debt including accrued interest and note discount | ||||||||||||||||
| Gain on extinguishment of derivative liability | ||||||||||||||||
| Other income | ||||||||||||||||
| Gain/(loss) on cryptocurrency investment-net | ( | ) | ||||||||||||||
| Interest income/(expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total other income/(expense) | ( | ) | ( | ) | ( | ) | ||||||||||
| (Loss) before provision for income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Provision for income taxes | ( | ) | ||||||||||||||
| Net (loss) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per share | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Weighted average common shares outstanding basic and diluted | ||||||||||||||||
The accompanying notes are an integral part of the unaudited consolidated financial statements.
| 5 |
THE CRYPTO COMPANY
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
| Shares | Amount | Shares | Amount | capital | Deficit | Deficit | ||||||||||||||||||||||
| Additional | Total | |||||||||||||||||||||||||||
| Preferred A stock | Common stock | Paid in | Accumulated | Stockholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Issuance of common stock for services | ||||||||||||||||||||||||||||
| Issuance of warrants for financing fee | ||||||||||||||||||||||||||||
| Common stock issued for note conversion | ||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Issuance of common stock for services | ||||||||||||||||||||||||||||
| Share-based compensation - warrants | ||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Shares | Amount | Shares | Amount | capital | Deficit | Deficit | ||||||||||||||||||||||
| Additional | Total | |||||||||||||||||||||||||||
| Preferred A stock | Common stock | Paid in | Accumulated | Stockholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance, December 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Common stock issued to complete Starchive.io rescission | ||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Balance | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Common stock issued upon PIPE subscriptions to reduce accrued liabilities | ||||||||||||||||||||||||||||
| Common stock issued as compensation | ||||||||||||||||||||||||||||
| Common stock issued on note payable conversion | ( | ) | ||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, June 30, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Balance | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
The accompanying notes are an integral part of the unaudited consolidated financial statements.
| 6 |
THE CRYPTO COMPANY
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
| 2026 | 2025 | |||||||
| For the six months ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net (loss) | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operations: | ||||||||
| Share-based compensation | ||||||||
| Common stock issued to settle accrued liabilities | ||||||||
| Change in derivative liability | ( | ) | ||||||
| Debt discount for warrants | ||||||||
| Loss on the extinguishment of debt | ||||||||
| Warrants issued for financing fee | ||||||||
| Gain on the extinguishment of debt | ||||||||
| Common stock issued as a financing fee | ||||||||
| Cryptocurrency | ||||||||
| Amortization of note discount | ||||||||
| Change in operating assets and liabilities: | ||||||||
| Accounts payable and accrued expenses | ||||||||
| Net cash provided (used in) operating activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Payment of notes payable | ( | ) | ( | ) | ||||
| Proceeds from stock subscriptions | ||||||||
| Stock issued to convert debt | ||||||||
| Proceeds from issuance of notes payable | ||||||||
| Net cash provided by financing activities | ||||||||
| Net decrease in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents at the beginning of the period | ||||||||
| Cash and cash equivalents at the end of the period | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Common stock issued for convertible debt | $ | $ | ||||||
| Common stock issued to reduce accrued liabilities | $ | $ | ||||||
| Cash paid during the period for: | ||||||||
| Income taxes | $ | $ | ||||||
| Interest | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited consolidated financial statements.
| 7 |
THE CRYPTO COMPANY
NOTES TO (UNAUDITED) CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – BASIS OF PRESENTATION AND THE COMPANY
Basis of Presentation
The unaudited condensed consolidated financial statements included in this Form 10-Q have been prepared in accordance with the U.S. Securities and Exchange Commission (the “SEC”) instructions for Quarterly Reports on Form 10-Q. Accordingly, the condensed consolidated financial statements are unaudited and do not contain all of the information required by U.S. Generally Accepted Accounting Principles (“GAAP”) to be included in a full set of financial statements. The unaudited condensed Consolidated Balance Sheet at December 31, 2025 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for a complete set of financial statements. The audited consolidated financial statements for our fiscal year ended December 31, 2025, filed with the SEC on Form 10-K on June 24, 2026, include a summary of our significant accounting policies and should be read in conjunction with this Form 10-Q. In the opinion of management, all material adjustments necessary to present fairly the results of operations, cash flows, and balance sheets for such periods have been included in this Form 10-Q. All such adjustments related to operations are of a normal recurring nature. The results of operations for interim periods are not necessarily indicative of the results of operations for the entire year.
Use of Estimates
The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and disclosures made in the accompanying notes to the condensed consolidated financial statements. Significant estimates and judgments may include those related to revenue recognition, derivative liability valuation, cryptocurrency fair value, debt classification, contingent obligations, goodwill valuation, asset impairment, business combination accounting, and income taxes. Actual results could materially differ from those estimates.
The Company
The Crypto Company was incorporated in the State of Nevada on March 9, 2017. The Company is engaged in the business of providing consulting services and education for distributed ledger technologies (“blockchain”), for the building of technological infrastructure and enterprise blockchain technology solutions. The Company currently generates revenues and incurs expenses solely through these consulting operations. The Company believes in the future developments of blockchain and crypto as mass adoption accelerates.
Unless expressly indicated or the context requires otherwise, the terms “Crypto,” the “Company,” “we,” “us,” and “our” in these consolidated financial statements refer to The Crypto Company and, where appropriate, its wholly-owned subsidiary Technology Convergence Company (“TechCC”) formerly Blockchain Training Alliance, Inc. (“BTA”), Frame Intelligence, LLC (“Frame Intelligence”) and an inactive subsidiary Coin Tracking, LLC (“CoinTracking”).
On March 23, 2026, the Company approved and authorized the execution of an Asset Purchase Agreement, dated as of March 20, 2026 (the “Asset Purchase Agreement”), by and among the Company, its wholly-owned subsidiary, Frame Intelligence, LLC, a Nevada limited liability company (“Frame Intelligence”), Frame Holdings Ltd, an exempted Cayman Islands company (“Frame Holdings”), and Sean Docherty.
Pursuant to the Asset Purchase Agreement, Frame Intelligence acquired all of the assets comprising the “Frame” blockchain business, including related intellectual property, source code, software repositories, validator and infrastructure access, credentials, documentation, and associated goodwill (collectively, the “Frame Assets”).
| 8 |
The Company entered into a Stock Purchase Agreement (the “SPA”) effective as of March 24, 2021 with BTA and its stockholders. On April 8, 2021, the Company completed the acquisition of all of the issued and outstanding stock of BTA and BTA became a wholly-owned subsidiary of the Company. As a result of this acquisition, the operations of BTA became consolidated with Company operations on April 8, 2021.
TechCC is a blockchain training company and service provider that provides training and educational courses focused on blockchain technology and education as to the general understanding of blockchain to corporate and individual clients.
During the three and six months ended June 30, 2026 and 2025, the Company generated revenues and incurred expenses primarily through the business of providing consulting services and education for distributed ledger technologies, for the building of technological infrastructure and enterprise blockchain technology solutions.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Going Concern
The
Company’s consolidated financial statements are prepared using the accrual method of accounting in accordance with United States
(“U.S.”) generally accepted accounting principles (“GAAP”) and have been prepared on a going concern basis, which
contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company has incurred significant
losses and experienced negative cash flows since inception. As of June 30, 2026, the Company had cash of $
The
Company, as part of the Frame Agreement (Note 4), has agreed to fund $
The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management evaluates this as a significant concern and is evaluating different strategies to obtain financing to fund the Company’s expenses and achieve a level of revenue adequate to support the Company’s current cost structure. Financing strategies may include, but are not limited to, private placements of capital stock, debt borrowings, partnerships and/or collaborations. Management continues to pursue financing alternatives and strategic transactions; however, no financing commitments have been obtained as of the date of these financial statements. There can be no assurance that any of these future funding efforts will be successful. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
As a result of the Company’s history of losses and its current financial condition, management has concluded that substantial doubt exists about the Company’s ability to continue as a going concern and meet its obligations as they become due within one year after the date these financial statements are issued.
Convertible
Debt and Derivative Liability – The Company reevaluated its treatment of Convertible Debt in 2025 and amended its 2024 financial
statements to recognize a derivative liability based on certain convertible debt which was deemed to qualify for derivative liability
treatment. As of December 31, 2025, the Company recognized Convertible Debt of $
| 9 |
As
of June 30, 2026, based on repayment, note restructuring and reclassification of certain liabilities, the Company concluded that only
one outstanding convertible note, with a principal balance of $
Basis of presentation – The company prepares its consolidated financial statements based upon the accrual method of accounting, recognizing income when earned and expenses when incurred.
Consolidation – The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Technology Convergence Company (formerly Blockchain Training Alliance, Inc.), Frame Intelligence, LLC, and CoinTracking LLC, which is inactive. All significant intercompany accounts and transactions have been eliminated in consolidation.
Use of estimates – The preparation of these consolidated financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosure of contingent assets and liabilities. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s significant estimates and assumptions include but are not limited to the recoverability and useful lives of long-lived assets, allocation of revenue on software subscriptions, valuation of goodwill from business acquisitions, valuation and recoverability of investments, valuation allowances of deferred taxes, and share- based compensation expenses. Actual results may differ from these estimates. In addition, any change in these estimates or their related assumptions could have an adverse effect on the Company’s operating results.
Cash and cash equivalents – The Company defines its cash and cash equivalents to include only cash on hand and certain highly liquid investments with original maturities of ninety days or less. The Company maintains its cash and cash equivalents at financial institutions, the balances of which may, at times, exceed federally insured limits. Management believes that the risk of loss due to the concentration is minimal.
Investments
in cryptocurrency – Investments are comprised of several cryptocurrencies the Company owns, including Bitcoin, Avax, Ethereum
and XRP tokens, which are actively traded on exchanges and amounted to a total of $
SCHEDULE OF DOLLAR VALUE OF TOKEN
| Units Held | Cost Basis | Fair Value | ||||||||||
| Token | Units Held | Cost Basis | Fair Value | |||||||||
| Bitcoin | $ | $ | ||||||||||
| Ethereum | $ | $ | ||||||||||
| XRP | $ | $ | ||||||||||
| AVAX | $ | $ | ||||||||||
| Total | $ | $ |
As a result of adopting ASC 350-60, Intangibles — Goodwill and Other, (“ASC 350-60”) on September 1, 2024, cryptocurrency is measured at fair value as of each reporting period (see “Recently Issued Accounting Pronouncements below”). The fair value of cryptocurrency is measured using the period-end closing price from the principal market for each cryptocurrency, in accordance with ASC 820, Fair Value Measurement (“ASC 820”). Since cryptocurrency is traded on a 24-hour period, the Company utilizes the price as of 23:59:59 UTC, which aligns with the Company’s revenue recognition cut-off. The changes in valuation due to remeasurement in fair value within each reporting period are reflected on the Consolidated Statements of Operations and Comprehensive Loss as “(Gain)/Loss on fair value of cryptocurrency, net”. In accordance with ASC 350-60, the Company discloses realized gains and losses from the sale of cryptocurrency and such gains and losses are measured as the difference between the cash proceeds and the cost basis of the cryptocurrency as determined on a First In-First Out basis.
As
of June 30, 2026 and December 31, 2025 there were $
Equipment
– Equipment is recorded at cost and depreciated using
the straight-line method over the estimated useful life ranging from three
| 10 |
Business combination – The purchase price of an acquired company is allocated between tangible and intangible assets acquired and liabilities assumed from the acquired business based on their estimated fair values with the residual of the purchase price recorded as goodwill. The results of operations of acquired businesses are included in our operating results from the dates of acquisition.
Goodwill
and intangible assets – The Company records the excess of purchase price over the fair value of the tangible and identifiable
intangible assets acquired as goodwill. Intangible assets resulting from the acquisitions of entities accounted for using the purchase
method of accounting are recorded at the estimated fair value of the assets acquired. Identifiable intangible assets are comprised of
purchased customer relationships, trade names, and developed technologies. Intangible assets subject to amortization are amortized over
the period of estimated economic benefit of
The
Company assesses whether goodwill impairment and indefinite lived intangible assets exists using both qualitative and quantitative assessments.
The qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the
fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment the Company
determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, or if the Company elects
not to perform a qualitative assessment, a quantitative assessment is performed to determine whether a goodwill impairment exists at
the reporting unit. As of June 30, 2026 and December 31, 2025 the Company had
Income taxes – Deferred tax assets and liabilities are recognized for expected future consequences of events that have been included in the consolidated financial statements or tax returns. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities.
When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits along with any associated interest and penalties that would be payable to the taxing authorities upon examination.
As
of December 31, 2025, we had a net operating loss carryforward for federal income tax purposes of approximately $
| 11 |
Fair value measurements – The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value.
| Level 1 | Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurable date. | |
| Level 2 | Inputs, other than quoted prices included in Level 1, which are observable for the asset or liability through corroboration with market data at the measurement date. | |
| Level 3 | Unobservable inputs that reflect management’s best estimate of what participants would use in pricing the asset or liability at the measurement date. |
The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts payable and accrued expenses approximate fair value because of the short maturity of these instruments.
The table below summarizes the valuation levels and amounts assigned to these assets and liabilities:
SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES
| Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| Cryptocurrency | $ | $ | ||||||||||||||
| Derivative Liability | $ | $ | ||||||||||||||
Revenue recognition – The Company recognizes revenue under ASC 606, Revenue from Contracts with Customers (“ASC 606”). The core principle of the new 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 |
In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct), and the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract).
If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct.
The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following:
Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate.
The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method for contracts as of the date of initial application.
In accordance with ASC No. 718, Compensation – Stock Compensation (“ASC 718”), the Company measures the compensation costs of share-based compensation arrangements based on the grant date fair value of granted instruments and recognizes the costs in the consolidated financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options.
| 12 |
Equity instruments (“instruments”) issued to non-employees are recorded on the basis of the fair value of the instruments, as required by ASC 718. ASC No. 505, Equity Based Payments to Non-Employees (“ASC 505”), defines the measurement date and recognition period for such instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete and (ii) the instruments are vested. The compensation cost is remeasured at fair value at each reporting period when the award vests. As a result, stock option-based payments to non-employees can result in significant volatility in compensation expense.
The Company accounts for its share-based compensation using the Black-Scholes model to estimate the fair value of stock option awards. Using this model, fair value is calculated based on assumptions with respect to the (i) expected volatility of the Company’s common stock price, (ii) expected life of the award, which for options is the period of time over which employees and non-employees are expected to hold their options prior to exercise, and (iii) risk-free interest rate.
Reclassifications – Certain amounts in the prior period consolidated financial statements have been reclassified to conform to the current period presentation. Such reclassifications had no effect on the Company’s financial position, results of operations or cash flows.
NOTE 3 – RECENT ACCOUNTING PRONOUNCEMENTS
ASU 2023-08 – Crypto Assets
The Company adopted ASU 2023-08. The standard requires qualifying crypto assets to be measured at fair value with changes recognized in earnings and requires additional disclosures regarding significant holdings.
ASU 2023-07 – Segment Reporting
The Company has adopted the enhanced disclosure requirements applicable to interim periods and has included the required disclosures in Note 11. ASU 2023-07’s interim requirements apply to the current reporting period.
Management has considered all recent accounting pronouncements issued. The Company’s management believes that recent pronouncements, not yet adopted, will not have a material effect on the Company’s financial statements.
NOTE 4 – ACQUISITIONS AND AGREEMENTS
Frame Agreement
On March 23, 2026, the Company approved and authorized the execution of an Asset Purchase Agreement, dated as of March 20, 2026 (the “Asset Purchase Agreement”), by and among the Company, its wholly-owned subsidiary, Frame Intelligence, LLC, a Nevada limited liability company (“Frame Intelligence”), Frame Holdings Ltd, an exempted Cayman Islands company (“Frame Holdings”), and Sean Docherty.
Pursuant to the Asset Purchase Agreement, Frame Intelligence acquired all of the assets comprising the “Frame” blockchain business, including related intellectual property, source code, software repositories, validator and infrastructure access, credentials, documentation, and associated goodwill (collectively, the “Frame Assets”).
As
consideration for the transfer of the Frame Assets, the Company agreed to issue shares of its common stock, par value $ per share
(“Common Stock”), to Frame Holdings via a series of contingent milestone-based issuances tied to specified Company market
capitalization and Frame business valuation thresholds. These include
| 13 |
Each such issuance of shares of Common Stock, if and when earned, will be calculated based on the 10-trading-day volume-weighted average price of the Company’s Common Stock immediately preceding the applicable issuance date and will be subject to customary securities law restrictions, transfer limitations, and the execution of definitive stock issuance documentation.
The
Asset Purchase Agreement also requires the Company to fund Frame Intelligence with at least $
On July 7, 2026, a Confirmation and Variation Agreement was executed to extend the Funding Requirement deadline by an additional 120 days as described above and to extinguish the $ Re-acquisition option.
The Asset Purchase Agreement further contains a buy-sell provision that may be triggered upon the occurrence of certain specified termination events, subject to applicable notice and cure periods and an overall five-year sunset following the closing of the transaction.
As noted above, an agreement to extinguish this option was entered into and signed on July 7, 2026.
The following terms are incorporated into the Confirmation and Variation Agreement:
Agreed Terms
1. Grant of Extension. The Seller hereby grants, and the Parties confirm, the 120-day extension of the Funding Deadline contemplated by Section 6.9(c) of the APA, such that the Funding Deadline is extended to the Extended Funding Deadline (the date 120 days after the original Funding Deadline), with effect from the Effective Date.
2. Extinguishment of the $ Re-acquisition Option. The Seller hereby irrevocably waives, releases and extinguishes the $ Re-acquisition Option under Section 9.1 of the APA in its entirety, with effect from the Effective Date. With effect from the Effective Date, the $ Re-acquisition Option shall be of no further force or effect, and neither the Seller nor SD shall have any right to re-acquire the Units of the Buyer thereunder.
3. Effect on the APA. Save as expressly varied by this Agreement, the APA and each Ancillary Agreement remain in full force and effect and are otherwise unamended, including without limitation TCC’s obligation to satisfy the Funding Requirement by the Extended Funding Deadline. In the event of any conflict between this Agreement and the APA in respect of the matters addressed herein, this Agreement shall prevail.
As
of June 30, 2026 and December 31, 2025 we had
The Company is continuing evaluation of the Frame Asset Purchase Agreement. As of June 30, 2026, no asset or liability has been recognized because of the contingent nature of consideration, uncertainty surrounding the funding requirement and continued development, and the absence of sufficient support for reliably measuring an acquired intangible asset at that date. Management will continue evaluating the accounting for the transaction as additional information becomes available and funding milestones are achieved.
NOTE 5 – RELATED PARTY TRANSACTIONS
On
January 27, 2025 (the “Advance Date”), the Company entered into a Promissory Note with Ronald Levy, the Company’s
Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board, and Secretary, in the original amount of $
On June 24, 2025 and June 25, 2025, the Company entered into stock agreements with five recipients to issue a total of shares as a bonus to employees and contractors for services. Ronald Levy the Company’s CEO received of those Common Shares and Holly Ruxin, a director, received of those Common Shares. The Common Shares received by Mr. Levy and Ms. Ruxin were on the same terms and conditions as the other Recipients.
| 14 |
On
July 10, 2025, the Company borrowed funds from Three Mile Creek Future LLC (“TMCF”) and issued a Promissory Note (the “TMCF
Note”) in the principal amount of
NOTE 6 – NOTES PAYABLE, CONVERTIBLE DEBT & DERIVATIVE LIABILITY
Summary of Outstanding Debt
SCHEDULE OF DEBT
| Instrument | Description | 12/31/25 | Q1 | 3/31/26 | Q2 | 6/30/26 | Due Date | Default | ||||||||||||||||||
| Notes Payable | ||||||||||||||||||||||||||
| AJB Capital | AJB Conversion | Dec-28 | No | |||||||||||||||||||||||
| CoinTracking Note | ( | ) | Past Due | Yes | ||||||||||||||||||||||
| Three Mile Creek | Related Party | Jan-26 | Yes | |||||||||||||||||||||||
| Fast Capital | ( | ) | Jan-24 | Yes | ||||||||||||||||||||||
| EKSA Holdings | Modified | Aug-26 | No | |||||||||||||||||||||||
| Practivist | Modified | Aug-26 | No | |||||||||||||||||||||||
| Robert Nail | Modified | Aug-26 | No | |||||||||||||||||||||||
| Individual Shareholders | Reclassified | Demand | No | |||||||||||||||||||||||
| Note Discount | Adjusted | ( | ) | ( | ) | N/A | No | |||||||||||||||||||
| Total Notes Payable | ( | ) | ||||||||||||||||||||||||
| Convertible Debt | ||||||||||||||||||||||||||
| EKSA Holdings | Converted | ( | ) | |||||||||||||||||||||||
| Practivist | Converted | ( | ) | |||||||||||||||||||||||
| Robert Nail | Converted | ( | ) | |||||||||||||||||||||||
| Ryan Crownholm | Repaid | ( | ) | |||||||||||||||||||||||
| Averitt Note | Jan-26 | Yes | ||||||||||||||||||||||||
| Individual Shareholders | Reclassified | ( | ) | |||||||||||||||||||||||
| Note Discount | Reclassified | ( | ) | |||||||||||||||||||||||
| - | - | |||||||||||||||||||||||||
| Total Convertible Debt | ( | ) | ||||||||||||||||||||||||
| Derivative Liability (BS) | ( | ) | ||||||||||||||||||||||||
| Change in Derivative Liability (IS) | ||||||||||||||||||||||||||
At December 31, 2025, derivative liabilities were measured using an option-pricing methodology based upon market inputs including stock price, historical volatility, expected term, dividend yield and risk-free interest rates.
During the six months ended June 30, 2026, management completed an instrument-by-instrument review of the Company’s outstanding debt agreements. Based on management’s evaluation of the outstanding debt instruments at June 30, 2026, only one instrument continued to require derivative accounting under ASC 815 as of June 30, 2026. The only instrument requiring derivative accounting treatment at June 30, 2026 was the Averitt note. The change in derivative value for the Averitt note during the six months ended June 30, 2026 was not material.
AJB Capital Note
On
December 19, 2025, AJB converted a total of fourteen (14) notes, totaling $
15
CoinTracking Note
The
CoinTracking Note is past due and continues to accrue interest at a
Fast Capital
On
February 2, 2023, the Company borrowed funds pursuant to a SPA entered into with Fast Capital, LLC (“Fast Capital”), and
Fast Capital purchased a
As
of December 31, 2025, the balance remaining under the Fast Capital Note was $
The
Fast Capital Note had a remaining discount of $
Three Mile Creek
On
July 10, 2025, the Company borrowed funds from Three Mile Creek Future LLC (“TMCF”) and issued a Promissory Note (the “TMCF
Note”) in the principal amount of
The principal balance of the TMCF Note was due on January 10, 2026. The managing member of the LLC is a related party. No action has been taken with respect to the past due note status. The TMCF Note bears no interest and can be pre-paid by the Company any time without penalty. To secure the payment and performance of all obligations under the TMCF Note, the Company granted to TMCF a continuing security interest in all assets of the Company (the “Collateral”). Upon event of default, the unpaid principal balance of the TMCF Note will immediately become due and payable, and TMCF will have all rights and remedies available to it under the Nevada Uniform Commercial Code, including the right to take possession of the Collateral and to sell or otherwise dispose of it. AJB Capital Investments LLC, which holds a first priority security interest in the Collateral, has consented to the creation of the TMCF security interest in the Collateral and agreed to subordinate its lien to TMCF’s security interest.
The
Warrant entitles TMCF to subscribe for and purchase from the Company up to
As
of June 30, 2026, the outstanding balance of the Three Mile Creek note is $
Promissory Notes - Investor
Beginning
on August 13, 2025, the Company executed subscription agreements with accredited investors: Eksa Holdings LLC, Practivist Investors LLC,
Richard G Averitt, Robert Nail, and Ryan Crownholm (each, an “Investor” and collectively, the “Investors”), in
which the Company issued an aggregate of shares of the Company’s common stock. These shares were valued at $
16
The Notes bear no interest and mature six months from the date of issuance of each Note (the “Maturity Date”), unless earlier converted or repaid in accordance with its terms.
On the Maturity Date, at each Investor’s election, the Notes are either: (a) converted into a number of shares equal to 135% of the principal amount of each Note divided by the cash value of one share of Common Stock, as determined by the average close price for the prior 10 trading days calculated on the Maturity Date; or (b) (i) if Investor contributes USD, repaid in BTC, in an amount equal to the BTC market value of the principal amount of the Note on the date the Company purchases BTC, or (ii) if Investor contributes Tokens, repaid in the same Token, in the quantity contributed. In case an Investor fails to make a conversion election, the principal amount of each Note shall convert into shares of Common Stock.
An
Investor may request full repayment of a Note at any time prior to the Maturity Date. If Investor contributes USD, the Note will be repaid
in BTC, in an amount equal to
The Notes contain customary representations, warranties, and covenants of the Company, as well as standard events of default.
Pursuant
to the Subscription Agreements, the Company issued to each Investor a number of shares of Common Stock equal to
Subsequent
to the initial subscription agreements, some convertible promissory notes were repaid or converted to standard promissory notes with
the issuance of consideration listed in the original convertible promissory note. Upon conversion of these notes to standard promissory
notes, the associated derivative liabilities were derecognized as the replacement instruments do not contain features requiring bifurcation
under ASC 815. The Company recognized a gain of $
As
of June 30, 2026, only the Averitt note, in the amount of $
The Ryan Crownholm note was repaid in the three months ended March 31, 2026 using the Tokens originally contributed.
The Averitt Note is now past due. The noteholder has made no demand for payment, and no interest is accruing.
The remaining Investor Promissory Notes are due in August, 2026. The noteholders have made no demand for payment, and no interest is accruing.
Notes Payable - Other
Promissory Note – Ron Levy
As
disclosed in Note 5 – Related Party Transactions, on January 27, 2025 (the “Advance Date”), the Company entered into
a Promissory Note with Ronald Levy, the Company’s Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board,
and Secretary, in the original amount of $
SBA Loans
●
On June 10, 2020, the Company received a loan from the Small Business Administration of $
●
On February 2, 2021, the Company received a loan from the Small Business Administration of $
17
NOTE 7 – OTHER LIABILITIES
During
the year ended December 31, 2023, the Company initially recorded $
NOTE 8 – EQUITY
Common stock
As
of June 30, 2026, the Company had shares of common stock, par value $ authorized. As of June 30, 2026 and December
31, 2025, there were and shares of common stock outstanding, respectively. During the six months ended June
30, 2026, the company issued shares of common stock, valued at approximately $
Preferred A Stock
Effective
September 5, 2024, the Company amended its Articles of Incorporation (the “Articles”), to amend and restate Sections
1 and 2 of Article 4 of the Articles to increase the number of authorized shares of the Company’s common stock (“Common
Stock”) from to and create a new class of stock, par value $ per share, designated as Series
A Preferred Stock consisting of authorized shares, as set forth in Certificate of Amendment to the Articles of Incorporation (the
“Amendment”). Pursuant to the Amendment, Common Stock and Preferred Stock are identical in all respects, except that
each share of Common Stock is entitled to one vote and
On the same date the Company entered into a stock agreement (the “Stock Agreement”) with, the Company’s CEO Ronald Levy pursuant to which the Company issued a total of ten () shares of the Company’s Series A preferred stock (“Preferred Stock”) Mr. Levy also serves as the Interim Chief Financial Officer, Chairman of the Board, Secretary, and a member of the Board of Directors of the Company.
Although the shares are not convertible to common stock these Series A Preferred Shares enable Mr. Levy to exercise control over the Company. The Series A Preferred shares carry voting power equivalent to voting shares.
Stock Options
On July 21, 2017, the Company’s board of directors adopted The Crypto Company 2017 Equity Incentive Plan (the “Plan”), which was approved by its stockholders on August 24, 2017. The Plan is administered by the board of directors (the “Administrator”). Under the Plan, the Company may grant equity awards to eligible participants which may take the form of stock options (both incentive stock options and non-qualified stock options) and restricted stock awards. Awards may be granted to officers, employees, non-employee directors (as defined in the Plan) and other key persons (including consultants and prospective employees). The term of any stock option award may not exceed years and may be subject to vesting conditions, as determined by the Administrator. Options granted generally vest over eighteen to thirty-six months. Incentive stock options may be granted only to employees of the Company or any subsidiary that is a “subsidiary corporation” within the meaning of Section 424(f) of the Internal Revenue Code.
During the year ended December 31, 2020, the Company issued stock options to members of its board of directors, stock options to employees, and stock options to non-employees. No stock options were issued in 2024.
18
shares of the Company’s common stock are reserved for issuance under the Plan. As of June 30, 2026, there are outstanding stock option awards issued from the Plan covering a total of shares of the Company’s common stock and there remain reserved for future awards shares of the Company’s common stock.
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (years) | ||||||||||
| Options outstanding, at December 31, 2024 | $ | |||||||||||
| Options granted | ||||||||||||
| Options cancelled | ||||||||||||
| Options exercised | ||||||||||||
| Options outstanding, at December 31, 2025 | $ | |||||||||||
| Options granted | ||||||||||||
| Options cancelled | ||||||||||||
| Options exercised | ||||||||||||
| Options vested and outstanding, at June 30, 2026 | $ | |||||||||||
The
Company recognized $-
The determination of the fair value of share-based compensation awards utilizing the Black-Scholes model is affected by the Company’s stock price and a number of complex and subjective assumptions, including stock price, volatility, expected life of the equity award, forfeitures rates if any, risk-free interest rates and expected dividends. Volatility is based on the historical volatility of comparable companies measured over the most recent period, generally commensurate with the expected life of the Company’s stock options, adjusted for future expectations given the Company’s limited historical share price data.
As of June 30, 2026 the following warrants were outstanding:
SCHEDULE OF OUTSTANDING WARRANTS TO PURCHASE SHARES OF COMMON STOCK
| Issuance Date | Exercisable for | Expiration Date | Exercise Price | Number of Shares Outstanding Under Warrants | ||||||||
| February 2020 | $ | |||||||||||
| February 2020 | $ | |||||||||||
| February 2020 | $ | |||||||||||
| April 2020 | $ | |||||||||||
| June 2020 | $ | |||||||||||
| March 2023 | $ | |||||||||||
| March 2023 | $ | |||||||||||
| April 2023 | $ | |||||||||||
| May 2023 | $ | |||||||||||
| June 2023 | $ | |||||||||||
| November 2023 | $ | |||||||||||
| April 2024 | $ | |||||||||||
| May 2024 | $ | |||||||||||
| February 2025 | $ | |||||||||||
| May 2025 | $ | |||||||||||
| June 2025 | $ | |||||||||||
| November, 2025 | $ | |||||||||||
19
NOTE 9 - COMMITMENTS AND CONTINGENCIES
Legal Contingencies
The Company may from time to time become subject to legal proceedings, claims, and litigation arising in the ordinary course of business. Responding to litigation or administrative proceedings, regardless of whether they have merit, can be expensive and disruptive to normal business operations. We are not able to predict the timing or outcome of these matters but currently do not expect that the resolution of these matters will have a material adverse effect on our financial position or results of operations.
Indemnities and guarantees - During the normal course of business, the Company has made certain indemnities and guarantees under which it may be required to make payments in relation to certain transactions. These indemnities include certain agreements with the Company’s officers and directors, under which the Company may be required to indemnify such persons for liabilities arising out of their respective relationships. The duration of these indemnities and guarantees varies and, in certain cases, is indefinite. The majority of these indemnities and guarantees do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. Historically, the Company has not been obligated to make significant payments for these obligations, and no liabilities have been recorded for these indemnities and guarantees in the accompanying balance sheet.
Commitments
As
part of an agreement with Starchive.io to rescind the Securities Purchase Agreement entered into on October 8, 2025 and effectively rescinded
as of October 16, 2025, the Company provided indemnification up to $
As
part of the Frame Asset Purchase Agreement discussed in Note 4, the Company has agreed to provide funding of $
NOTE 10 - SUBSEQUENT EVENTS
Frame Agreement Update
On March 23, 2026, the Company approved and authorized the execution of an Asset Purchase Agreement, dated as of March 20, 2026. On July 7, 2026 a Confirmation and Variation Agreement was executed modifying certain terms in the Asset Purchase Agreement. Both agreements are discussed in detail in Note 4.
Issuance of Common Stock
On
July 6, 2026, the Company issued shares of its common stock to its CEO, Ron Levy, in exchange for a reduction in his accrued,
but unpaid, compensation of $
On the same date, the Company issued shares of common stock to Three Mile Creek Future LLC in satisfaction of subscriptions of approximately $ received in the six months ended June 30. The Company’s Chief Strategy Officer, Rafael Furst, is the managing member of the LLC.
The
Company also issued shares on that date to investors to satisfy $
The
Company issued shares as compensation to an employee with a fair value of $ and shares as non-employee
compensation for legal and accounting services with a fair value of $
Promissory Notes – EKSA Holdings, Practivist and Robert Nail
These notes were due in August, 2026. As of the filing date, they are past due. No demand has been made, no interest is accruing, and no enforcement action has been taken.
Subscription
On
August 14, 2026, the Company received an investment of $
NOTE 11 – SEGMENT INFORMATION
The
Company operates as a
The Company’s revenues are derived primarily from consulting, training and educational services related to blockchain technology. The accounting polices of the reportable segment are the same as those described in Note 2.
The measure of segment performance reviewed by the CODM is the net loss. Significant information including significant segment expenses reviewed by the CODM include salaries & wages, professional fees and other G&A expenses as follows.
SCHEDULE OF SEGMENT INFORMATION
| 2026 | 2025 | |||||||
| For the six months ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Revenues | ||||||||
| Salaries & Wages | ||||||||
| Professional Fees | ||||||||
| Other General and Administrative | ||||||||
20
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion of our financial condition and results of operations in conjunction with the consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q (“Quarterly Report”) and with our audited consolidated financial statements, including the notes thereto, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Annual Report”), as filed with the U.S. Securities and Exchange Commission (“SEC”). In addition to historical consolidated financial information, the following discussion and analysis contain forward-looking statements that reflect our plans, estimates, and beliefs and involve risks and uncertainties. The words “may,” “could,” “should,” “estimate,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan” and similar expressions are intended to identify forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report, as well as risks referenced in our other filings with the SEC.
Overview of Our Business
We are primarily engaged in the business of providing consulting, training, and educational services for distributed ledger technologies (“blockchain”), for individual and corporate clients, enterprises for general blockchain education, as well as for the building of technological infrastructure and enterprise blockchain technology solutions. We currently generate revenues and incur expenses through these consulting and educational operations. The Company believes in the future developments of blockchain and crypto as mass adoption accelerates.
On March 23, 2026, the Company approved and authorized the execution of an Asset Purchase Agreement, dated as of March 20, 2026 (the “Asset Purchase Agreement”), by and among the Company, its wholly-owned subsidiary, Frame Intelligence, LLC, a Nevada limited liability company (“Frame Intelligence”), Frame Holdings Ltd, an exempted Cayman Islands company (“Frame Holdings”), and Sean Docherty.
Pursuant to the Asset Purchase Agreement, Frame Intelligence acquired all of the assets comprising the “Frame” blockchain business, including related intellectual property, source code, software repositories, validator and infrastructure access, credentials, documentation, and associated goodwill (collectively, the “Frame Assets”).
Recent Developments
Frame Asset Purchase Agreement Update
On July 7, 2026, a Confirmation and Variation Agreement was executed to update the Frame Asset Purchase Agreement extending the Funding Requirement deadline by an additional 120 days and extinguishing the $1.00 Re-acquisition option.
The Asset Purchase Agreement further contains a buy-sell provision that may be triggered upon the occurrence of certain specified termination events, subject to applicable notice and cure periods and an overall five-year sunset following the closing of the transaction.
The Confirmation and Variation Agreement extinguishes this option.
21
The following terms are incorporated into the Confirmation and Variation Agreement:
Agreed Terms
1. Grant of Extension. The Seller hereby grants, and the Parties confirm, the 120-day extension of the Funding Deadline contemplated by Section 6.9(c) of the APA, such that the Funding Deadline is extended to the Extended Funding Deadline (the date 120 days after the original Funding Deadline), with effect from the Effective Date.
2. Extinguishment of the $1.00 Re-acquisition Option. The Seller hereby irrevocably waives, releases and extinguishes the $1.00 Re-acquisition Option under Section 9.1 of the APA in its entirety, with effect from the Effective Date. With effect from the Effective Date, the $1.00 Re-acquisition Option shall be of no further force or effect, and neither the Seller nor SD shall have any right to re-acquire the Units of the Buyer thereunder.
3. Effect on the APA. Save as expressly varied by this Agreement, the APA and each Ancillary Agreement remain in full force and effect and are otherwise unamended, including without limitation TCC’s obligation to satisfy the Funding Requirement by the Extended Funding Deadline. In the event of any conflict between this Agreement and the APA in respect of the matters addressed herein, this Agreement shall prevail.
The Company is continuing evaluation of the Frame Asset Purchase Agreement. As of June 30, 2026, no asset or liability has been recognized because of the contingent nature of consideration, uncertainty surrounding the funding requirement and continued development, and the absence of sufficient support for reliably measuring an acquired intangible asset at that date. Management will continue evaluating the accounting for the transaction as additional information becomes available and funding milestones are achieved.
Comparison of the three and six months ended June 30, 2026 and June 30, 2025
Revenue
Revenues for the six months ended June 30, 2026 and 2025, were $5,512 and $7,086 respectively. The decrease in revenue was due to decreased demand for blockchain training services.
General and Administrative Expenses
For the six months ended June 30, 2026, our general and administrative expenses were $1,467,216 compared to $1,253,871 for the six months ended June 30, 2025. General and administrative expenses consist primarily of costs relating to professional services, payroll, and payroll-related expenses. Professional services included in general and administrative expenses consist primarily of contracting fees, consulting fees, and accounting fees.
Other Income (Expense)
During the six months ended June 30, 2026 other income was $548,728 compared to other expense of $372,923 for the six months ended June 30, 2025. The improvement is primarily attributable to a benefit from the extinguishment of derivative liability due to the conversion and restructuring convertible notes payable, a decrease in interest expense due to a reduction in interest bearing notes and a reduction in the loss on extinguishment of debt.
Net Loss
As a result of the foregoing, we recorded a loss of $884,719 or $(0.0002) per share for the six months ended June 30, 2026 compared to a loss of $1,619,708 or $(0.0005) per share for the six months ended June 30, 2025.
Liquidity
Operating Activities
Net cash used in operating activities was $268,179 for the six months ended June 30, 2026, compared to net cash used in operating activities of $295,437 for the six months ended June 30, 2025. The decrease in net cash used in operating activities during the 2026 period was primarily due to an increase in accounts payable and accrued liabilities and the reduction of Share-based compensation.
22
Investing Activities
Net cash used in investing activities was $-0- for the six months ended June 30, 2026 and 2025.
Financing Activities
Net cash provided by financing activities for the six months ended June 30, 2026, was $181,130 compared to cash provided by financing activities of $297,951 for the six months ended June 30, 2025. The decrease in net cash provided by financing activities was primarily due to an increase in repayments of loans in the 2026 period compared to the 2025 period.
Market Conditions, Trends, Events, and Uncertainties
Blockchain
The blockchain technology market is dynamic and unpredictable. Although we will undertake compliance efforts, including efforts with commercially reasonable diligence, there can be no assurance that there will not be a new or unforeseen law, regulation or risk factor which will materially impact our ability to continue our business as currently operated or raise additional capital to foster our continued growth.
Cryptocurrency
As a result of adopting ASC 350-60, Intangibles — Goodwill and Other, (“ASC 350-60”) on September 1, 2024, cryptocurrency is measured at fair value as of each reporting period (see “Recently Issued Accounting Pronouncements below”). The fair value of cryptocurrency is measured using the period-end closing price from the principal market for each cryptocurrency, in accordance with ASC 820, Fair Value Measurement (“ASC 820”). Since cryptocurrency is traded on a 24-hour period, the Company utilizes the price as of 23:59:59 UTC, which aligns with the Company’s revenue recognition cut-off. The changes in valuation due to remeasurement in fair value within each reporting period are reflected on the Consolidated Statements of Operations and Comprehensive Loss as “(Gain)/Loss on fair value of cryptocurrency, net”. In accordance with ASC 350-60, the Company discloses realized gains and losses from the sale of cryptocurrency and such gains and losses are measured as the difference between the cash proceeds and the cost basis of the cryptocurrency as determined on a First In-First Out basis.
Other than as discussed in this Quarterly Report and our 2025 Annual Report, we are not aware of any other trends, events, or uncertainties that are likely to have a material effect on our financial condition.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements requires us to make estimates that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent liabilities. We base our judgments on our historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making estimates about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We have no material changes to our Critical Accounting Policies and Estimates disclosure as filed in our 2025 Annual Report.
Recent Accounting Pronouncements
See Note 3 to the consolidated financial statements for a discussion of recent accounting pronouncements.
Off-Balance Sheet Transactions
We do not have any off-balance sheet transactions.
23
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.
ITEM 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Our management, including our principal executive officer and principal financial officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of June 30, 2026. Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of June 30, 2026, to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures. In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting during the period ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
24
PART II. Other Information
ITEM 1. Legal Proceedings.
See Note 9, Commitments and Contingencies, within our condensed consolidated financial statements for a summary of legal proceedings. The Company is subject, from time to time, to various legal proceedings that are incidental to the conduct of its business. The Company is not involved in any pending legal proceeding that it believes would reasonably be expected to have a material adverse effect on its financial condition or results of operations.
ITEM 1A. Risk Factors.
In evaluating us and our common stock, we urge you to carefully consider the risks and other information in this Quarterly Report on Form 10-Q, the Risk Factors disclosed in Item 1A. of Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, that could materially and adversely affect our results of operations or financial condition.
Changes in tax laws or regulations may have a material adverse effect on our cash flow, business, financial condition, results of operations or prospects.
New tax laws, statutes, rules, regulations or ordinances could be enacted at any time. Further, existing tax laws, statutes, rules, regulations or ordinances could be interpreted differently, changed, repealed or modified at any time. Any such enactment, interpretation, change, repeal or modification could adversely affect us, possibly with retroactive effect. For example, the U.S. government recently enacted legislation commonly referred to as the One Big Beautiful Bill Act, which (along with prior U.S. federal tax reform legislation) has resulted in significant changes to the taxation of business entities, including, among other changes, the imposition of minimum taxes and excise taxes, changes to the taxation of income derived from international operations, changes in the deduction and amortization of research and development expenditures, and limitations on the deductibility of business interest. Future guidance from the Internal Revenue Service and other tax authorities with respect to these and other legislation may affect us, and certain aspects of such legislation could be repealed or modified in future legislation or sunset in future years. In addition, it is uncertain if and to what extent various states will conform to federal law. We continue to evaluate the impact that these and other tax reforms may have on our business.
Risks Associated with the Shutdown of the United States Government.
The United States federal government has experienced periodic shutdowns. When the government is not funded, non-essential federal employees are furloughed and services are limited or curtailed. A prolonged shutdown may lead to broader economic uncertainty and financial market volatility. These conditions could negatively affect our operations, and overall demand for our services and products.
A prolonged shutdown could slow regulatory approvals, reduce demand from contractors and public-sector customers, and result in hiring freezes or reduced hiring activity among clients that rely on federal contracts or are otherwise affected by economic uncertainty.
Further, a prolonged or future shutdown of the U.S. federal government could materially impact the operations of the SEC. For example, the SEC announced that during the current/ U.S. federal government shutdown, it will not declare registration statements effective. In the event of an extended shutdown, the SEC may operate with limited staff or suspend certain functions altogether, which could delay the review or effectiveness of our filings, including registration statements or other financing-related disclosures. Such delays could adversely affect our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue to fund our operations.
While we strive to mitigate these risks through contingency planning and industry government affairs efforts, the ultimate impact of any government shutdown is difficult to predict and may be outside our control. Any material adverse effects resulting from a government shutdown could have a negative impact on our business, financial position, and results of operations.
As a smaller reporting company, we are subject to scaled disclosure requirements that may make it more challenging for investors to analyze and compare our results of operations and financial prospects.
Currently, we are a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act. As a “smaller reporting company,” we are able to provide simplified executive compensation disclosures in our filings and have certain other decreased disclosure obligations in our filings with the SEC, including being required to provide only two years of audited financial statements in annual reports. Consequently, it may be more challenging for investors to analyze our results of operations and financial prospects.
25
ITEM 3. Defaults upon Senior Securities.
As of June 30, 2026, the following indebtedness was past its contractual maturity. The principal amount of each instrument individually exceeds 5% of the Company’s total assets. See Note 6 to the condensed consolidated financial statements for a complete description of each instrument.
Three Mile Creek Future LLC Promissory Note. The note in the principal amount of $188,552 matured January 10, 2026. The managing member of Three Mile Creek Future LLC is a related party. The holder has made no demand for payment, no interest is accruing, and no enforcement action has been taken.
CoinTracking GmbH Promissory Note. The note in the principal amount of $244,400 is past due and continues to accrue interest at 10% per annum. The holder has requested repayment but has taken no further enforcement action. A partial payment of $10,000 was made during the three months ended June 30, 2026.
Averitt Convertible Promissory Note. The note in the principal amount of $38,772 matured January 1, 2026. The holder has made no demand for payment, no interest is accruing, and no enforcement action has been taken.
All three instruments are classified as current liabilities on the Company’s Consolidated Balance Sheet as of June 30, 2026.
ITEM 4. Mine Safety Disclosures.
Not applicable.
ITEM 5. Other Information.
During
the three and six months ended June 30, 2026, no director or officer of the Company
During the quarter, the Company responded to comments from the Staff (“Staff”) of the Securities and Exchange Commission on the restatement of the financial statements included in the Form 10-K for the year ended December 31, 2024, including the impact on prior periods. In connection with this review, the Company updated and enhanced its disclosures to reflect the restatement and provide additional clarity. As of December 31, 2024, the Company recognized, on its balance sheet, a Derivative liability, and, on its Consolidated Statement of Operations, a change in derivative liability in the amount of $1,319,366.
Subsequent to June 30, 2026, the Company has been responding to further comments from the Staff. That review remains ongoing.
26
ITEM 6. Exhibits.
27
| 10.15 |
| |
| 10.16* | Form of Subscription Agreement by and between The Crypto Company and Red Neck Yacht Fund, LP
| |
| 31.1* | Certification of the Company’s Principal Executive Officer, Principal Financial and Accounting Officer pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1** | Certification of the Company’s Principal Executive Officer, Principal Financial and Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS* | Inline XBRL Instance Document | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definitions Linkbase | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase | |
| 104* | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Filed herewith.
** Furnished, not filed.
28
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Dated: August 19, 2026 | THE CRYPTO COMPANY | |
| (Registrant) | ||
| By: | /s/ Ron Levy | |
| Ron Levy | ||
Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board, and Secretary (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) | ||
29
Exhibit 10.16
The securities offered hereby have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state and are being offered and sold in reliance on exemptions from the registration requirements of the Securities Act and such laws. The securities are subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and such laws. The securities have not been approved or disapproved by the Securities and Exchange Commission (the “SEC”), any state securities commission or other regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of this offering of Subscription Shares. Any representation to the contrary is unlawful.
Any subscription materials included herewith are for your confidential use only and may not be reproduced.
The Crypto Company
SUBSCRIPTION AGREEMENT
Principal Investment Amount: ___________________ or Tokens: type (e.g. BTC) _____ quantity _____
Subscription Shares: ____________________
This Subscription Agreement (this “Agreement”) is dated as of ____________ by and between The Crypto Company, a Nevada corporation (the “Company”), and _________________________________________ (the “Subscriber”).
The parties agree as follows:
1. Subscription. Subject to the terms contained herein and in consideration of the mutual covenants and agreements set forth in this Agreement, and for other good and valuable, the Subscriber hereby subscribes (the “Subscription”) to purchase from the Company, and the Company hereby agrees to issue and sell to the Subscriber a total of _________________ shares (the “Subscription Shares”), of common stock of the Company, par value $0.001 per share (the “Common Stock”), in a private placement in reliance on the exemptions from registration provided under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder (“Regulation D”) and applicable state exemptions.
2. Prepaid Warrant. In addition to the Subscription Shares, and as additional consideration for the Subscriber’s investment hereunder, the Company hereby grants to the Subscriber a prepaid warrant (the “Prepaid Warrant”) to participate in the Company’s next subsequent private placement offering of securities, if any, for gross proceeds of not less than $1,000,000 (excluding the exercise of the Prepaid Warrant) with the following terms (the “Subsequent Offering”). The Subscriber acknowledges that the Company is not obligated to undertake or consummate any Subsequent Offering, and there can be no assurance that any such financing will occur.
| (a) | Prepaid Nature. The Prepaid Warrant is fully paid as of the date hereof by virtue of the Subscriber’s payment of the Principal Investment Amount set forth above. The Subscriber acknowledges that the Subscription Shares and the Prepaid Warrant are part of a single integrated private placement transaction for purposes of applicable securities laws. No additional consideration shall be required from the Subscriber to exercise the Prepaid Warrant. Upon exercise, the Subscriber shall be entitled to participate in the Subsequent Offering in an aggregate amount equal to the Principal Investment Amount. | |
| (b) | Terms of Subsequent Offering. The Subsequent Offering, if undertaken, shall be conducted on such terms and conditions as determined by the Company. The securities issuable upon exercise of the Prepaid Warrant shall be of the same class and series, and issued on the same economic terms, as the securities issued in the Subsequent Offering. The Subscriber acknowledges and agrees that the terms of the Subsequent Offering are not specified herein and shall be established by the Company at the time of such Subsequent Offering, and that the Company may elect not to pursue or complete any such offering. |
| Page 1 of 10 |
| (c) | Exercise Period. The Prepaid Warrant may be exercised by the Subscriber at any time during the period commencing on the initial opening date of the Subsequent Offering and ending on the initial closing date of the Subsequent Offering (the “Exercise Period”). The Company shall provide the Subscriber with written notice of the opening of the Subsequent Offering and the terms thereof not less than five (5) business days prior to the initial closing date of the Subsequent Offering. | |
| (d) | Method of Exercise. To exercise the Prepaid Warrant, the Subscriber shall deliver to the Company a written notice of exercise and shall execute the subscription agreement or other investment documentation required for the Subsequent Offering. Upon such exercise, the Principal Investment Amount previously paid by the Subscriber hereunder shall be applied in full toward the Subscriber’s participation in the Subsequent Offering, and no additional payment shall be due from the Subscriber. | |
| (e) | Non-Transferability. The Prepaid Warrant is personal to the Subscriber and may not be sold, assigned, transferred, pledged, or otherwise disposed of without the prior written consent of the Company. | |
| (f) | No Cash Settlement. In no event shall the Prepaid Warrant be settled in cash, net cash, or otherwise outside the issuance of securities of the Company. | |
| (g) | No Valuation Anchoring. The Subscriber acknowledges and agrees that participation in this Subscription or the receipt of the Prepaid Warrant does not imply, establish, or reflect any valuation cap, floor, benchmark, or pricing reference with respect to the Company or any future financing, including the Subsequent Offering. The Subscriber further acknowledges that the price, valuation, and economic terms of the Subsequent Offering, if any, may be materially higher or materially lower than the implied valuation of the Company reflected by this Subscription, and that participation in the Subsequent Offering through exercise of the Prepaid Warrant does not guarantee any particular pricing, valuation outcome, or economic result. The Subscriber expressly disclaims reliance on any statements, assumptions, or expectations regarding the pricing, valuation, or terms of any Subsequent Offering that are not expressly set forth in a definitive written agreement executed by the Company. | |
| (h) | Expiration if No Subsequent Offering. If the Company does not consummate a Subsequent Offering within 60 months from the date of this Agreement (or such other period as determined by the Company in its sole discretion), the Prepaid Warrant shall automatically expire and be of no further force or effect, and the Subscriber shall have no further rights with respect thereto. The Company shall have no obligation to issue any securities or make any payments in lieu of the Prepaid Warrant upon its expiration. |
3. Subscription Shares; Method of Payment.
(a) The Subscriber hereby subscribes to purchase the Subscription Shares. The Principal Investment Amount shall be paid by wire transfer of immediately available funds in accordance with the wire instructions set forth on Exhibit B attached hereto (the “Wire Instructions”), or in the case of Subscriber investing Tokens via instructions the Company communicates separately. The Subscriber acknowledges and agrees that the Company may update the Wire Instructions upon written notice to the Subscriber, and that the Company shall not be responsible for any funds sent to outdated or incorrect wiring instructions not expressly provided by the Company.
| Page 2 of 10 |
(b) If any portion of the Principal Investment Amount is paid in the form of digital assets, cryptocurrencies, or blockchain-based tokens (collectively, “Tokens”), the parties agree that the fair market value of such Tokens for all purposes under this Agreement (including, without limitation, determination of the Principal Investment Amount, the number of Subscription Shares issued, and any rights under the Prepaid Warrant) shall be determined and fixed as of the date of this Agreement, regardless of the date on which such Tokens are transferred to or received by the Company.
The fair market value of the Tokens shall be calculated based on the spot price in U.S. dollars quoted for such Tokens on a commercially reasonable, widely-recognized digital asset exchange or pricing index selected by the Company in good faith.
The Subscriber acknowledges and agrees that any fluctuation in the market value of the Tokens after the date of this Agreement, whether prior to or after transfer to the Company, shall be borne solely by the Subscriber and shall not affect the number of Subscription Shares issued or any other rights or obligations under this Agreement.
4. Closing. This Agreement shall not be binding on the Company until the satisfaction of each of the Closing conditions set forth in Section 5 below and this Agreement has been accepted by the Company, which shall be evidenced by the Company countersigning this Agreement and the delivery thereof to the Subscriber. The closing of the purchase and sale of the Subscription Shares (the “Closing”) shall occur upon the delivery of the Subscriber’s signature to this Agreement to the Company and the Company’s acceptance of this Agreement and delivery of its signature hereto.
5. Subscription Irrevocable. This Subscription is irrevocable, and the Subscriber agrees it is not entitled to cancel, terminate, or revoke this Subscription.
6. Conditions to Obligations of the Company. The obligations of the Company to issue the Subscription Shares to the Subscriber at the Closing are subject to the fulfillment (or waiver by the Company), before or at the time of the Closing, of each of the following conditions:
A. Accredited Investor. The Company has a reasonable belief that the Subscriber is an “Accredited Investor” as such term is defined in Rule 501(a) of Regulation D and the purchase of the Subscription Shares is a suitable investment for the Subscriber as represented in Section 9 of this Agreement.
B. Execution of Subscriber Documents. The Subscriber will have executed and delivered (i) this Agreement, and (ii) the Subscriber Questionnaire attached hereto as Exhibit A. Together this Agreement and the Subscriber Questionnaire are hereinafter referred to as the “Investor Documents.”
C. Accuracy of the Subscriber’s Representations. The representations made by the Subscriber in this Agreement and in the Subscriber Questionnaire (which is incorporated by this reference as part of this Agreement) shall be accurate in all material respects when made and at the time of Closing.
D. Performance by the Subscriber. The Subscriber shall have duly performed and complied in all material respects with all agreements, covenants and conditions contained in this Agreement required to be performed or complied with by the Subscriber before the Closing.
| Page 3 of 10 |
7. Information Documents.
A. Receipt of Information Documents. The Subscriber has been furnished with and hereby acknowledges receipt of all of the information and documents it has requested in connection with this investment, including all reports and filings made by the Company with the Securities and Exchange Commission pursuant to Section 13(a) and Section 14 of the Securities Exchange Act of 1934, as amended (collectively, the “Information Documents”).
B. Information Document Acknowledgement. The Subscriber has reviewed (or had its legal, tax or financial advisers review) to the extent the Subscriber deemed appropriate, and understands, the contents of the Information Documents. The Subscriber acknowledges that the Company has provided the Subscriber with information about the subscription in the Subscription Shares in light of the Subscriber’s status as an “Accredited Investor” and the Subscriber’s business and financial sophistication. The Subscriber acknowledges the Information Documents do not provide all of the information that a non-accredited investor would be entitled to receive under Regulation D.
8. Representations of the Company.
A. The Company represents and warrants to the Subscriber that the Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Nevada and has all requisite power and authority to carry on its business as proposed to be conducted and to issue the Subscription Shares to the Subscriber.
9. Covenants and Representations of the Subscriber. Knowing the Company will rely on the following information to determine the applicability of various securities laws, the suitability of the Subscriber as an investor in the Company, and for certain other purposes, the Subscriber hereby covenants, represents and warrants (as applicable) to the Company that:
A. Accredited Investor. The Subscriber is an “Accredited Investor” as such term is defined under Rule 501(a) of Regulation D.
B. Securities Not Registered. The Subscriber understands the Subscription Shares have not been registered under the Securities Act in reliance on certain exemptions thereunder for transactions not involving any public offering or under the laws of any state, and the Subscription Shares have not been approved or disapproved by the SEC or by any other federal or state agency. The Subscriber understands that the Company is under no obligation to assist the Subscriber in complying with any exemption from registration under the Securities Act or under the securities laws of any state.
C. Risks. The Subscriber recognizes an investment in the Subscription Shares involves a significant degree of risk and understands such risks, including those set forth in the Information Documents.
D. Investment Intent. The Subscriber is acquiring the Subscription Shares subscribed hereby solely for the Subscriber’s own account for investment and not on behalf of other persons and not with a view to or for resale, division, or distribution thereof, or the grant of any participation therein. The Subscriber has no present intent to distribute or sell to any other person any of such Securities or to grant any participation therein.
| Page 4 of 10 |
E. Transfers Restricted. The Subscriber acknowledges that the Subscription Shares will be issued as “restricted securities” under the Securities Act and may not be sold or otherwise transferred until the earlier of (i) the six-month anniversary of this Agreement or (ii) registration of the Subscription Shares under the Securities Act, after which the Subscription Shares can be sold on the open market. In connection with any proposed sale or transfer of the Subscription Shares in reliance upon Rule 144 under the Securities Act, the Company may require the Subscriber to obtain, at the Subscriber’s sole cost and expense, a customary legal opinion of Company counsel at a pre-determined rate, and its transfer agent to the effect that such sale or transfer is in compliance with the Securities Act. The Subscriber agrees that any fees and expenses of counsel in preparing and delivering such opinion shall be borne by the Subscriber.
F. Restricted Securities. The Subscription Shares shall be restricted securities under the Securities Act and certificates representing the Subscription Shares (if any) will contain legends substantially as follows:
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
G. Sophistication. The Subscriber has such knowledge and experience in business and financial matters as to be capable of evaluating the Company and the proposed activities thereof and the risks and merits of an investment in the Company and of making an informed investment decision therein.
H. Proportionality and Suitability. The Subscriber can bear the economic risk of the investment, including a complete loss thereof without impairing the Subscriber’s ability to provide for the Subscriber (and, in the case of an individual Subscriber, his or her family) in the same manner as the Subscriber was prior to making such investment. The nature and amount of the investment is suitable for the Subscriber and consistent with the Subscriber’s overall investment program and financial condition.
I. Authorization of Agreement, etc. The Subscriber has the full capacity, power and authority to execute and deliver to the Company this Agreement and the Investor Documents. This Agreement and the Investor Documents are the legal, valid and binding obligations of the Subscriber enforceable against the Subscriber in accordance with their terms, except as such enforceability may be affected by (a) applicable bankruptcy, reorganization, insolvency, moratorium and other similar laws and court decisions of general application, including, without limitation, statutory and other laws regarding fraudulent or preferential transfers relating to, limiting or affecting the enforcement of creditors’ rights generally; or (b) general principles of equity, including the effect of such general principles of equity upon the specific enforceability of any of the remedies, covenants or other provisions contained herein or therein and their application (regardless of whether enforcement is considered in a proceeding at law or in equity or in accordance with arbitration) as such principles relate to, limit or affect the enforcement of creditors’ rights generally.
| Page 5 of 10 |
J. Legal Representation. The Subscriber acknowledges that: (i) BakerHostetler LLP (the “Firm”), has represented the Company in connection with the Subscription and assisted the Company with certain of the other documents in its capacity as counsel for the Company; (ii) the Firm does not represent the Subscriber or any of their respective affiliates by reason of this investment; and (iii) the Subscriber is advised and encouraged by the Firm to seek independent legal, tax, and financial counsel in connection with the Subscriber’s purchase of the Subscription Shares. The Subscriber waives any claim that the Firm or the Company has provided legal or investment advice to the Subscriber. The Firm is an intended third-party beneficiary of this provision.
K. OFAC and Anti-Money Laundering Compliance. The Subscriber represents that neither it nor, to its knowledge, any person or entity controlling, controlled by, or under common control with the Subscriber, is subject to sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) or any similar governmental authority, and the funds used for the purchase of the Subscription Shares and Warrants are not derived from any illegal or illicit activity.
L. Update of Representations; Reliance by the Company. All information the Subscriber has provided or will provide to the Company in connection with this Agreement is true, correct and complete as of the date of execution of this Agreement and as of the date of the Closing. The Subscriber will promptly provide to the Company written notice of any material changes in such information and such information will be true, correct and complete as of the date given and as of the date of the Closing. However, the Subscriber acknowledges that, except as required by applicable law, the Company has no obligation to update or supplement any Information Documents or public disclosures after the date hereof, and the Subscriber is not relying on any representation regarding future updates or disclosures.
M. Tax Considerations. The Subscriber is not relying on the Company or any of the Company’s professional advisers with respect to individual tax considerations involved in an investment in the Subscription Shares. The Subscriber understands and acknowledges there can be no assurances as to the tax results of an investment in the Subscription Shares.
N. Access to Information. The Subscriber has either consulted its own investment adviser, attorney or accountant about the investment in and proposed purchase of the Subscription Shares and the suitability to the Subscriber or chosen not to do so, despite the recommendation of such course of action by the Company. The Subscriber (or its professional advisers) has been provided an opportunity to ask questions of, and the Subscriber has received answers thereto that are satisfactory to the Subscriber from, the Company and its representatives regarding the Company, the Information Documents and other matters pertaining to the Company and this investment, and the Subscriber has obtained all additional information requested by the Subscriber. The Subscriber acknowledges the Subscriber has received or had the opportunity to request and review all information regarding the Company and this investment material to the Subscriber’s investment decision regarding the Subscription Shares. The Subscriber is not relying on the completeness of the Company’s public disclosures alone, but instead on its own independent analysis and the advice of its own professional advisers, if any.
O. No Representations, Warranties or Covenants. None of the Company or any of its officers, directors, employees, managers, members, agents or affiliates has made, and the Subscriber has not relied upon, any oral or written representations, warranties, projections, forecasts, estimates, budgets, financial models, covenants, or forward-looking statements, of any kind regarding the Company, other than those expressly set forth herein. Any forward-looking statements that may be included in the Information Documents are inherently uncertain and are based on assumptions, estimates, expectations, and judgments as of the date made, all of which are subject to significant business, economic, market, regulatory, and other risks and uncertainties, many of which are beyond the Company’s control. Actual results may differ materially from those expressed or implied by any forward-looking statements, and the Subscriber assumes full responsibility for evaluating the merits and risks of this investment without reliance on any such statements. The Subscriber further acknowledges that this investment is speculative and that no assurance has been made regarding the Company’s future performance, liquidity, or the value of the Subscription Shares or Prepaid Warrants.
| Page 6 of 10 |
P. Source of Funds. The Subscriber represents and warrants that all funds, assets, or consideration used to purchase the Subscription Shares and Prepaid Warrant, whether paid in cash, by wire transfer, or in the form of Tokens (collectively, the “Investment Consideration”), are derived solely from the Subscriber’s lawful sources and are not the proceeds of, and are not directly or indirectly derived from, any illegal activity, including, without limitation, money laundering, terrorist financing, sanctions violations, or other activities prohibited by applicable laws and regulations. If any portion of the Investment Consideration is paid in Tokens, the Subscriber further represents and warrants that:
i. the Tokens are owned and controlled exclusively by the Subscriber and are transferred from a digital wallet or account that is under the Subscriber’s direct or indirect control;
ii. the Tokens have not been mixed, anonymized, or otherwise obfuscated through the use of tumblers, mixers, privacy-enhancing technologies, or similar services designed to conceal the origin or ownership of such Tokens; and
iii. neither the Tokens nor any wallet, address, or account from which such Tokens are transferred is, or to the Subscriber’s knowledge has been, associated with any person or entity that is the subject of sanctions administered or enforced by OFAC or any other applicable governmental authority.
Q. Priority of Securities. The Subscriber acknowledges and agrees that the Company may, in the future, issue additional equity securities or securities convertible into or exercisable for equity securities, including in connection with the Subsequent Offering, on such terms as the Company may determine in its sole discretion. Any such securities may have rights, preferences, privileges, or economic terms that are senior to or more favorable than the Subscription Shares, the Prepaid Warrant, or any other securities issued in connection with this Subscription.
R. No Anti-Dilution or Pricing Protection. The Subscriber acknowledges that neither this Agreement nor any other agreement or understanding provides the Subscriber with any anti-dilution protection, price-based adjustment, most-favored-nation right, valuation protection, or other mechanism designed to protect against dilution, changes in valuation, or the issuance of securities at prices or on terms more favorable than those applicable to the Subscription Shares or any securities issuable pursuant to the Prepaid Warrant.
The Subscriber acknowledges and agrees that the Company may require additional information or documentation reasonably necessary to verify the foregoing representations and may refuse, reject, or return any consideration that the Company reasonably determines, in good faith, does not satisfy applicable legal, regulatory, or compliance requirements.
| Page 7 of 10 |
S. Leak-Out Restriction. Any sales, transfers, or other dispositions of Common Stock of the Company by the Subscriber shall be subject to the following restrictions: (i) the Subscriber shall not sell, transfer, or otherwise dispose of more than eight percent (8%) of the total trading volume of the Company’s Common Stock, as traded on the applicable stock exchange or market, during any calendar month, calculated based on the total trading volume during the immediately preceding calendar month (the “Leak-Out Restriction”), and (ii) all such sales, transfers, or other dispositions shall comply with applicable securities laws, regulations, and the Company’s policies. The restrictions set forth in this Section shall not apply to (a) transfers of shares to immediate family members or for estate planning purposes, provided the recipient agrees in writing to be bound by the terms of this Section, (b) sales pursuant to a tender offer, merger, or acquisition involving the Company, or (c) any other transaction approved in writing by the Company. The Company reserves the right to review and verify compliance with this Leak-Out Restriction. In the event of a breach of the Leak-Out Restriction, the Company shall be entitled to seek injunctive relief and any other remedies available at law or in equity, including but not limited to the recovery of profits made by the Subscriber in violation of this Section. The Subscriber acknowledges and agrees that the Company may require additional information or documentation reasonably necessary to verify the foregoing representations and may refuse, reject, or return any consideration that the Company reasonably determines, in good faith, does not satisfy applicable legal, regulatory, or compliance requirements.
10. Indemnification. The Subscriber agrees to indemnify the Company and its officers, directors, employees, managers, members, agents and affiliates and any person acting on behalf of any of the foregoing, from and against all damage, loss, penalty, liability, cost and expense (including reasonable attorneys’ fees) which any of them may incur by reason of any breach of this Agreement by the Subscriber, including, without limitation, any inaccuracy contained in the Subscriber’s representations, warranties or agreements in this Agreement.
11. Limitation of Liability. To the fullest extent permitted by law, in no event shall the Company be liable to the Subscriber for any indirect, incidental, consequential, special, or punitive damages arising out of or relating to this Agreement or the transactions contemplated hereby.
12. Verification. The Subscriber hereby authorizes the Company to verify any of the information set forth in this Agreement. The Subscriber understands the Subscriber may be required to furnish additional information to the Company in connection with this Agreement.
13. Rejection. The Company may reject this Subscription in whole or in part in its sole discretion, and prior to the Closing may withdraw, cancel or modify the offering of the Subscription Shares.
14. Assignability. This Subscription is neither transferable nor assignable by the Subscriber.
15. Applicable Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Nevada without regard to the law of conflicts thereof.
16. Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their heirs, executors, administrators, legal representatives, successors, and permitted assigns, as the case may be. If the Subscriber is more than one person, the obligations hereunder shall be joint and several and the agreements, representations, warranties, and acknowledgments contained herein shall be deemed to be made by and be binding upon each such person and his, her or its heirs, executors, administrators, legal representatives, successors, and permitted assigns, as the case may be.
| Page 8 of 10 |
17. Notices. Whenever notice is required or permitted by this Agreement to be given, such notice will be in writing and will be deemed to have been given (a) upon personal delivery, if delivered by hand, (b) three days after the date of deposit in the mail, postage prepaid, return receipt requested, if mailed by certified or registered mail, or (c) the next business day if sent by a prepaid overnight courier service, and in each case to the notice address below or to such other address or addresses as such party will have furnished to the other party in writing:
| If to the Subscriber: | To the address set forth below the Subscriber’s signature. | |
| If to the Company: | The Crypto Company | |
| 23823 Malibu Road, Suite 50477 | ||
| Malibu, California 90265 |
Notwithstanding the foregoing, no notice to a party will be deemed received on a day that is not a business day in the jurisdiction in which notices are to be addressed to such party and any such notice will not be effective until the next succeeding business day in such jurisdiction.
18. Pronouns; Survival. Where the context so indicates in this Agreement, the masculine pronouns shall include the feminine and neuter pronouns, singular pronouns shall include the plural pronouns, and the word “person” shall include a corporation or other legal entity. The representations, warranties, covenants, and agreements contained herein shall survive the Closing.
19. Counterparts. This Agreement may be executed in one or more counterparts, all of which will constitute one and the same instrument. This Agreement may be delivered by facsimile transmission or by scanned e-mail transmission. This Agreement will be considered to have been executed by a person if there exists a photocopy, facsimile copy, scanned copy, or a photocopy of a scanned or facsimile copy of an original hereof or of a counterpart hereof which has been signed by such person. Any photocopy, scanned copy, facsimile copy, or photocopy of facsimile copy of this Agreement or a counterpart hereof will be admissible into evidence in any proceeding as though the same were an original.
20. Entire Agreement. This Agreement and the exhibits hereto (which are incorporated herein by this reference) constitute the entire agreement between the parties hereto with respect to the subject matter hereof and specifically supersedes any prior agreement, arrangement, or understanding between the parties regarding such subject matter, whether written or oral. All section and exhibit references herein, unless specifically indicated otherwise, refer to sections of or exhibits to this Agreement.
21. Confidentiality. The Subscriber agrees to keep confidential and not disclose to any third party (other than its legal, tax, or financial advisers) the terms of this Agreement, the Information Documents, and any non-public information regarding the Company, except as required by law.
22. Type of Ownership. The Subscriber wishes to own the Subscription Shares as follows (check one):
__________Separate or individual property;
__________Joint tenants with right of survivorship;
__________Tenants by the entirety;
__________Tenants in common;
__________Community property;
| Trust (include name of trust, name(s) of trustee, and include a copy of the trust instrument); | |
| Partnership (include a copy of the partnership agreement and written consent of all general partners authorizing the Subscription): | |
| Corporation (include a copy of the articles of incorporation and corporate resolution authorizing the Subscription); | |
| Limited liability company (include a copy of the articles of organization, operating agreement, and written consent of the manager(s) authorizing the Subscription): or | |
| Other (indicate): ____________________________ |
23. Name. The name(s) in which the Subscription Shares are to be held:
[Remainder of Page Intentionally Left Blank]
| Page 9 of 10 |
The Subscriber hereby represents that he, she, or it has read this Subscription Agreement in its entirety.
By executing this Subscription Agreement, the Subscriber hereby confirms the Subscriber’s agreement with the Company and hereby agrees to be bound by all of the terms herein and by the other agreements contemplated hereby and to perform all obligations imposed thereunder upon a stockholder of the Company with respect to the subscribed Securities.
| Date: ____________________________ | |
| SUBSCRIBER: | |
| Signature | |
| Print or Type Name | |
| Social Security/Tax I.D. No. | |
| Street Address | |
| City State Zip | |
| Daytime Telephone Number |
SPECIAL INSTRUCTIONS: Individual Subscribers must list their principal place of residence rather than their office or other address on this signature page; whereas a Subscriber that is an entity must list the location of its principal office as its address on this signature page. FAILURE TO FOLLOW THESE INSTRUCTIONS MAY SUBJECT THE COMPANY TO PENALTIES UNDER FEDERAL, STATE AND OTHER APPLICABLE LAWS.
|
ACCEPTANCE: | ||
| SUBSCRIPTION ACCEPTED THIS DATE:_______________ | ||
| THE CRYPTO COMPANY | ||
| Name: | Ron Levy | |
| Title: | Chief Executive Officer | |
| Page 10 of 10 |
Exhibit 31.1
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT
I, Ron Levy, certify that:
1. I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2026, of The Crypto Company;
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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period 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 control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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, including its consolidated subsidiaries, is made known to me by others within those entities, 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 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; and
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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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.
| Date: August 19, 2026 | |
| /s/ Ron Levy | |
| Ron Levy | |
Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board, and Secretary (Principal Executive Officer and Principal Financial Officer) |
Exhibit 32.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of The Crypto Company (the “Company”) on Form 10-Q for the quarter ended June 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ron Levy, Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board, and Secretary of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
| (1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |
IN WITNESS WHEREOF, the undersigned has executed this certification as of August 19, 2026.
| /s/ Ron Levy | |
| Ron Levy | |
Chief Executive Officer, Interim Chief Financial Officer, Chairman of the Board, and Secretary (Principal Executive Officer and Principal Financial Officer) |
|
| August 19, 2026 |