SBET

Good morning, everyone, and thank you for participating in today's conference call to discuss SharpLink's financial and operating results for the second quarter ended June 30th, 2026. By now, everyone should have access to the second quarter 2026 earnings press release, which was issued this morning at approximately 8:00 A.M. Eastern Time. The release is available in the investor relations section of SharpLink's website. This call will also be available for webcast replay on the SharpLink's website. Following management's prepared remarks, we will open the call for questions. I will now hand the call over to SharpLink's Vice President of Business and Legal Affairs, Dodi Handy, for introductory comments.

Thank you, operator. Please see SharpLink's quarterly report on Form 10-Q, filed on Friday, August 7, 2026 with the SEC, along with the earnings press release that crossed the wire this morning. These documents list some of the factors that may cause the results of SharpLink to differ materially from what we say today and identify some of the risks and uncertainties that could affect our business, prospects, and future results. SharpLink assumes no duty and does not undertake to update any forward-looking statements. Any forward-looking statement made by us during this call is based only on information currently available to us and speaks only as of the date when it is made. In addition, we may be discussing or providing certain metrics today, such as ETH per share and other treasury-related performance metrics that are not GAAP measures.

Please see our earnings press release and SEC filings for further information regarding these metrics. To set the agenda for today's call, we will begin with Joe Lubin, SharpLink's Chairman of the Board, co-founder of Ethereum, and founder and CEO of ConsenSys. Joe will discuss Ethereum's evolution and a foundational infrastructure for programmable financial and economic activity, including the network's technological roadmap, expanding institutional adoption, and an ecosystem that grows increasingly capable of supporting global finance at scale.

Next, SharpLink's Chief Executive Officer, Joseph Chalom, will discuss the Ethereum institutional super cycle, SharpLink's ecosystem initiatives, recent capital allocation activity, and how SharpLink is putting its ETH treasury to work through staking and active treasury management. Finally, our Chief Financial Officer, Bob DeLucia, will recap SharpLink's second quarter financial results, liquidity position, and key ETH treasury performance metrics. Now, at this time, I'd like to turn the call over to SharpLink's Chairman of the Board, Joseph Lubin. Joe, the floor is yours.

Thank you, Dodi, and good morning, everyone. As a co-founder of Ethereum and CEO of ConsenSys, I have had the privilege of helping build the ecosystem from its earliest days. For much of the first decade, Ethereum was often evaluated through the narrow lens of diverse waves of innovation, crypto market cycles, and short-term asset prices. Those forces remain visible, but they are increasingly incomplete measures of the progress taking place visibly and beneath the surface.

Ethereum is transitioning from technology once viewed as experimental into core infrastructure for programmable financial and economic activity. Stablecoins, tokenized assets, decentralized markets, and automated commerce are operating today, settling meaningful value and attracting increasingly sophisticated users, human, corporate, and machine. It is clear that this market is unique compared to others. Ethereum now benefits from more mature custody, security, and compliance infrastructure, deeper institutional expertise, and a more constructive regulatory framework.

Major financial and technology companies are moving beyond proof-of-concept projects towards production systems. Technological adoption, regulatory development, and asset prices will not always move on the same timeline, but the direction of travel is increasingly clear. Ethereum is foundational infrastructure for the programmable global economy. Manufacturers and stakeholders are increasingly aligning around this inevitable outcome. The momentum is not exclusively top-down. Alongside accelerating institutional participation, we are seeing renewed excitement and engagement from retail users, developers, and entrepreneurs. Institutional adoption brings scale, capital, and credibility, while grassroots participation continues to drive experimentation, applications, and community growth. Together, they reinforce our belief that we are entering a new Ethereum era, supported by broad-based conviction rather than any single category of participant. The Ethereum economy is becoming an increasingly intrinsic part of the diverse global economy.

Ethereum's defining advantage is a credibly neutral, censorship-resistant, programmable infrastructure that is guaranteed to execute properly formed transactions or programs. It enables institutions and other participants to transact and coordinate through automated, transparent rules without surrendering control to a single commercial intermediary, thus eliminating or reducing exposure to counterparty risk and other forms of risk.

The Ethereum Foundation has described this as shared, neutral digital infrastructure for governments, institutions, and communities. Its applications extend beyond payments to asset issuance, trade settlement, identity registries, attestations, and tokenized markets. Over time, we expect ETH's value proposition to become increasingly aligned with the amount, quality, and strategic importance of activity across the network. Robinhood's decision to build its blockchain infrastructure on Ethereum is one recent proof point. In its Q2 results, Robinhood described Robinhood Chain as a permissionless, AI-native, financial-grade Ethereum Layer 2 blockchain built to institutional standards.

A platform with 28 million customers and $369 billion in assets choosing Ethereum rails for its next generation of products. The institutions that hold the world's assets are moving in the same direction. Just last week, BlackRock, the world's largest asset manager, expanded its tokenized cash platform with new products built on Ethereum, building on the continued growth of its BUIDL Fund. JP Morgan, a bank whose CEO once publicly dismissed digital assets, has also deepened its Ethereum footprint, filing for a second tokenized money market fund on the network and expanding institutional use of its JPM Coin deposit token on Ethereum's Base network. The Ethereum ecosystem is also evolving to support this next stage of adoption.

The Ethereum Foundation continues to play an essential role in protecting the protocol's core properties and long-term resilience, while additional specialized steward organizations are emerging to add focus and execution across important areas of the ecosystem. We are supporting that evolution directly through investment in EthLabs, Ethereum Institutional, and EthSystems, which Joseph will discuss in greater detail.

These organizations are designed to address protocol development, institutional engagement, and privacy infrastructure while preserving the independence and credible neutrality that differentiates Ethereum from other blockchain ecosystems. This diversification of specialized steward organizations will greatly strengthen, accelerate, and broaden the Ethereum ecosystem. The protocol roadmap is advancing in parallel. The upcoming Glamsterdam hard fork marks the first concrete step in the broader lean Ethereum roadmap that Vitalik recently outlined. A three to four-year effort to rebuild Ethereum's core around lean consensus, lean data, and lean execution.

Its two headline changes, ePBS, enshrined proposer-builder separation, and BAL, block-level access lists, provide the technical foundation for subsequent upgrades, including the next hard fork, Hegotá. For institutions, the significance is that Glamsterdam is not a one-off upgrade, but the next major move in a multi-year evolution towards a much faster, more private, and quantum-resistant Ethereum, with capacity and performance improvements expected to powerfully compound across each successive fork. Ethereum's first decade proved the technology. The next will be defined by its adoption at massive scale as the network moves rapidly from experimentation to real-world implementation. That transition has significant implications for the company's positions to participate in Ethereum's growth. That is why we are building SharpLink to be an active participant in this new Ethereum era.

Our objective is to provide public market investors with disciplined, productive exposure to Ethereum's long-term growth while supporting the ecosystem that underpins our treasury asset, Ether. As Ethereum's role in the global economy expands, we intend for SharpLink to grow alongside it. I would now like to turn the call over to SharpLink's Chief Executive Officer, Joseph Chalom, to discuss how SharpLink is putting that strategy into place. Joseph?

Thank you, Joe, and good morning, everyone. Thank you for joining us. Joe briefly described the new Ethereum era taking shape. From my perspective, we are well underway in the institutional super cycle. This new era is a crucial part of making sure the network is ready for the coming demand. Importantly, we're not just observing this new era take shape, we're actively building it.

We deploy ETH capital back into the ecosystem through staking, our DeFi deployments, and the Galaxy SharpLink Onchain Yield Fund. We're also funding new institutions to accelerate institutional adoption, including EthLabs, Ethereum Institutional, and EthSystems, which I will go into more detail on later in my remarks. We are proud to be one of Ethereum's most active stewards and have taken a deliberate approach to building relationships, supporting critical infrastructure, and creating new ways to make our ETH productive.

We are genuinely energized by the momentum we're seeing and the caliber of engagement it's generating. We believe our efforts have helped shift the narrative on Ethereum from one defined by short-term price swings to one grounded in long-term value creation, reinforcing our conviction that this is the moment to lead with the discipline and ambition this Ethereum opportunity deserves. This turnaround reflects real work by real people. Joseph Lubin, myself, Tom Lee of Bitmine, and a number of other ecosystem stakeholders have been actively investing directly in Ethereum's infrastructure. We are telling its story more effectively than we have in the past, and it's working. Sentiment has turned very positive. Ethereum is winning. During the month of July, ETH appreciated 22%, compared to 11% for Bitcoin, while Solana declined 5%. That price performance is being matched by capital flows.

According to Blockworks, U.S. spot Ethereum ETFs pulled in approximately $349 million in net inflows in July, outpacing Bitcoin's ETFs at roughly $281 million, and Solana ETFs at approximately $25 million over the same period. Short-term asset prices do remain volatile, but ETH's price performance and the capital flowing in are signals reinforcing our belief that a new Ethereum era is taking shape alongside continued progress across institutional adoption, network development, and on-chain activity. We spent the last year building for this exact environment. This past June marked our first anniversary since launching our Ethereum treasury strategy. In that time, we raised over $3.3 billion in capital and became the world's second-largest corporate holder of ETH. We recruited a world-class team spanning traditional finance and digital assets expertise.

We have been among the most active companies putting that ETH to work, establishing institutional custody and staking infrastructure to make our treasury productive from day one. Just as importantly, we've built a culture of institutional risk management and governance from the outset, which has kept us disciplined and resilient through a volatile crypto cycle. The market is validating the institutional character of the platform we have built. As part of the Russell Index June 2026 reconstitution, SharpLink was added to the Russell 2000 and the Russell 3000 indices. According to FTSE Russell, approximately $12.2 trillion in assets are benchmarked against Russell U.S. indices. We view our inclusion as an important milestone that broadens institutional visibility and eligibility for index-linked ownership while providing external validation of SharpLink's scale, liquidity, and strategy. I now want to turn to capital allocation.

We have been consistent from day one about our framework to compound ETH per share and grow net ETH over time. We pursue those objectives through two complementary engines. The first is disciplined public market capital allocation, including issuing equity when terms are attractive and accretive, purchasing ETH when doing so improves long-term shareholder economics, and repurchasing SharpLink shares when they trade below our assessment of its intrinsic value. We demonstrated that optionality during the second quarter.

On June 23rd, 2026, we completed a $75 million registered direct offering, issuing roughly 10 million shares and accompanying warrants at a combined purchase price of $7.49 per share and warrant. Importantly, the transaction was completed at a premium to SharpLink's net asset value, providing capital on attractive terms. We used a portion of that capital to acquire approximately 10,000 ETH at an average price of approximately $1,611 per ETH.

We also purchased 2.1 million shares during Q2 at an average price of approximately $4.70 per share for an aggregate purchase price of approximately $10 million. Since initiating our repurchase activity in August 2025, we have repurchased approximately 4 million shares at an aggregate cost of approximately $41.7 million. Together, these actions show how we can raise capital on attractive terms, acquire ETH during market dislocations, and repurchase shares when our equity is undervalued, all in support of long-term shareholder value. The second engine is treasury productivity. We stake and selectively deploy our ETH to earn incremental returns above the Composite Ethereum Staking Rate, or CESR, a market benchmark for the average annualized yield earned by Ethereum validators. Our most recent example of this was our announcement of the Galaxy SharpLink Onchain Yield Fund.

The fund has $125 million in committed capital, including $100 million from SharpLink and $25 million from Galaxy Digital. SharpLink will fund its investment through a contribution of ETH or liquid staked ETH. We are very excited to share that the initial investment opportunities have already been identified. Actual deployment timing will depend on finalizing those opportunities in line with the fund's risk and return standards.

We are actively evaluating additional productivity strategies, including other funds, on-chain vaults, direct deployments, and structured ecosystem opportunities. Inbound demand has been strong, but access alone is not a reason to deploy capital. We proceed only when the expected incremental ETH return appropriately compensates shareholders for the risk, liquidity profile, and operating burden. That productivity mindset extends beyond our own balance sheet. Our scale, market presence, and connectivity also enable us to serve as an institutional steward of the Ethereum ecosystem.

As I mentioned earlier, we provided anchor funding to EthLabs, Ethereum Institutional, and EthSystems, three organizations we believe are already generating real momentum and driving the next stage of Ethereum's institutional development. These three independent organizations serve different functions. First, EthLabs, founded by former senior Ethereum Foundation contributors, is focused on advancing the core protocol, scaling, ecosystem growth, usability, and interoperability. Its work is designed to prepare Ethereum for the next wave of institutional DeFi and agentic finance adoption while reinforcing the network's credible neutrality, security, and resilience. Second, Ethereum Institutional serves as a dedicated institutional front door and helpdesk to the Ethereum ecosystem, assisting banks, asset managers, custodians, and market infrastructure providers move from evaluation to deployment. The organization has built more than 500 institutional relationships and convened over 150 senior executives representing approximately $250 trillion in combined assets.

Third, EthSystems is an engineering and research company founded by the team behind the Ethereum Foundation's Institutional Privacy Task Force. It is building privacy and compliance infrastructure that enables banks, asset managers, and other regulated institutions to transact on Ethereum at scale without exposing sensitive information such as trade details or client identity. Together, these organizations serve as three coordinated accelerants of adoption for protocol scalability, institutional engagement, and privacy for regulated financial activity. I am pleased to serve on the board of Ethereum Institutional, where my experience across asset management and financial market infrastructure can help traditional organizations understand how Ethereum is uniquely suited to fit their business needs. We believe stronger protocol, institutional participation, and privacy infrastructure can accelerate Ethereum adoption and strengthen the ecosystem underlying and powered by the ETH on our balance sheet.

The growing market engagement around these initiatives reinforces our conviction that investors are increasingly recognizing Ethereum's institutional opportunity. The opportunity set is expanding alongside Ethereum itself. The network has the deepest developer base in the blockchain sector and hosts more than half of global stable coin supply, the majority of tokenized real-world assets, and approximately 62% of DeFi total value locked.

That depth of activity creates liquidity, resilience, and an innovation base that is difficult to replicate. One of the most important emerging categories is agentic finance. As AI agents increasingly make purchases, manage financial positions, and transact with other agents, they will require programmable money, verifiable identities, enforceable rules, and permissionless settlement infrastructures. Early indicators are already meaningful. Based on the last 30 days, Coinbase's x402 protocol is showing a run rate of approximately 225 million payment transactions across tens of thousands of active agents.

While still early, this activity demonstrates that autonomous software agents are beginning to participate directly in economic activity and should increase demand for stable coins, collateral, smart contract execution, and secure verifiable settlement. In summary, we have built scale, and now we are putting that scale to work. We are allocating capital dynamically, combining foundational staking with selective active return strategies.

We are supporting infrastructure that strengthens Ethereum and evaluating additional ways to use our operating platform to generate long-term shareholder value. We are relentlessly focused on our North Star, compound ETH per share, and net ETH earned over time through disciplined capital allocation, productive treasury management, and rigorous risk controls. We have also taken a proactive strategic role in telling the Ethereum story alongside a broader community of stakeholders, and we believe that work has helped turn the tide on how the market perceives the Ethereum opportunity. We intend to keep showing up, not just as one of Ethereum's largest holders, but as one of the most active champions. With that, I'll turn the call over to our Chief Financial Officer, Bob DeLucia, to review our second quarter financial results. Bob?

Thank you, Joseph. I'll begin by encouraging everyone to review our quarterly report on Form 10-Q for the period ending June 30th, 2026, which we filed on Friday, August 7th, 2026, with the SEC. The 10-Q provides detailed disclosures and footnotes that complement today's discussions, offering stockholders, analysts, and investors a comprehensive view of SharpLink's financial position, liquidity and its ETH treasury performance.

We will now go through the financial results for the quarter ended June 30th, 2026. I'd like to remind everyone that all comparisons and variance commentary refer to the prior year quarter, unless otherwise specified. As of June 30th, 2026, SharpLink held 632,784 native ETH, with a net fair value of $989 million. In addition, we held 162,083 of LS-ETHs, or liquid staked ETH, and 66,267 of WE-ETH or wrapped ether.fi ETH, with a combined net cost value of $369.2 million.

Subsequent to quarter end, our combined ETH holdings have increased to 634,255 native ETH, 181,748 as-if-redeemed LS-ETHs, and 72,935 as-if-redeemed WE-ETHs, for a total of 888,938 ETH as of Monday, August 3rd, 2026. Total revenue for the quarter ended June 30th, 2026 was $11.5 million, compared with $0.7 million for the quarter ended June 30th, 2025. The increase was driven by our staking and ETH yield-generating strategies.

We recorded a net realized gain of $1.4 million, compared with a $5.4 million realized gain in the prior year quarter. The gain in the current quarter was due to the derecognition of LS-ETHs. We also recorded an unrealized loss of $321 million, compared with a $2.4 million unrealized loss in Q2 of 2025. We also recorded an impairment charge of $76.1 million, compared with an $87.8 million charge in the prior year quarter.

SG&A expenses in the second quarter were $9.1 million, compared with $2.4 million in the prior year quarter. The increase reflects our ETH treasury strategy operating for a full quarter in 2026, versus only a partial period following its launch in early June 2025. The additional expenses included personnel, custody, insurance, legal, accounting, and other public company infrastructure costs.

For the second quarter of 2026, we reported a net loss of $394.3 million, compared to a net loss of $103.4 million in the prior year. The Q2 2026 results were driven primarily by the previously discussed unrealized fair value loss of $321 million, and an impairment charge of $76.1 million, which was partially offset by the $1.4 million of realized gains. Overall, our second quarter performance reflects the broad decline in crypto asset prices experienced across the market during the quarter.

As we noted previously, the impairment charges and unrealized losses recorded this quarter reflect current market pricing dynamics and the accounting requirements of U.S. GAAP. These accounting measures do not represent realized economic losses on our ETH position, nor do they impact the number of ETH units we hold. Our treasury strategy continues to be evaluated on disciplined ETH accumulation and long-term productivity of those assets over time. As of June 30th, 2026, cash on hand was $56.2 million, compared to cash on hand of $28.5 million as of December 31st, 2025. Between our cash position, our unencumbered ETH holdings, and the flexibility of our capital allocation framework, we believe SharpLink maintains ample liquidity going forward to execute on its strategy across a range of market conditions and opportunities.

For additional details, our complete financial statements and accompanying footnotes, including all required disclosures and management's MD&A analysis, are contained in our quarterly report on Form 10-Q for the period ended June 30th, 2026, filed with the SEC. This concludes our prepared remarks. We will now open it up for questions from those participating on the call. Operator, back to you.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you please limit yourself to one question and one follow-up question. One moment, please, while we poll for questions. Our first questions come from the line of Devin Ryan with Citizens Bank. Please proceed with your questions.

Thanks so much. Good morning, Joseph and Bob. I want to start with a question on the agentic opportunity, obviously tracking a lot of activity. I think I just read somewhere where in recent months, the majority of traffic on the internet is now non-human. So AI agents are obviously scaling pretty rapidly, but we are also early days. I would love to just hear a little bit more about how you all see that playing out on blockchain. I know you mentioned stablecoins, we are seeing good activity there, but just the evolution with agents from where we are now. Do they care which chain they use? Why is Ethereum well-suited? How much share can Ethereum win? Then just more broadly, what SharpLink is doing to position for that opportunity.

I know EthLabs is maybe one example, but just love to hear a little bit more about how you are thinking about the opportunity. Thank you.

Good morning, Devin. Great question. It is one actually that gets me quite excited. I want to set the context. Agentic finance and commerce is really about giving individuals and their agents, some people will refer to them as digital twins, something that only institutions have ever had before. An individual, you could say, in the future is going to have a treasury desk or a CFO in their pocket. For listeners, every large asset manager employs people whose job it is to make sure that no dollar sits in a portfolio idle. Every security is being lent or borrowed to earn yield. Every share gets voted. Most individuals globally have never had access to that. An autonomous agent with the will of an individual is what is going to make that possible.

Think of it as always on, autonomously executing your preferences at basically zero marginal cost with massive scale. The gap that it's going to close for retail investors is actually enormous. American households, the last time we checked, hold around $6 trillion in checking accounts, around $15 trillion if you count savings account. Most of it is earning a fraction of prevailing market rates, that's not a problem with the banks or a product problem. It's actually a labor and intentionality problem. No one's going to manually sweep their cash every night and rebalance their portfolios and lend their stocks, but agents and software can and will. Your second point about why Ethereum, it's really for two reasons. There's an open source protocol called x402.

You can think of it as a micro payments capability that lets agents pay one another in stablecoins on Ethereum without asking a card network or a proprietary permission network for any permissions. That is already crossing hundreds of millions in transactions. On top of that open source micro payments network and protocol, you have Ethereum's ERC-8004. It actually gives agents guide rails and a registry so that they can establish identity and trust with no intermediary sitting in between. Nobody has to convene a consortium to make that happen. It's live, it's shipped, and Ethereum is already leading the agentic finance underlying infrastructure. The second element is, I think, the underrated part. Neutrality is a financial feature, not an ideological one, and not a product defect. Look at who's racing to own these rails.

Stripe did about $1.9 trillion in payments last year, launched its own onchain. Visa, Mastercard, Google, all shipping agent payment standards. These are really good company, but if your rails and your agent are owned by a payments company, they're the ones who are going to decide what yield your product gets swept into, what products they recommend, and will take a fee along the way. Ethereum is the only architecture where no one sits in that seat in between agents and users. It's had a decade of uptime. It has no individual owner or concentrated foundation. Nobody can change the rules underneath you. The way I'll put it is, if the rails are proprietary, that agent in your pocket will answer to whoever built it.

If they're neutral and Ethereum is the leading chain in terms of maturity, liquidity, trust, your agents will essentially answer to you. So we believe very strongly the stablecoin layer is dominated on Ethereum and their Layer 2s, the tokenized asset rails and DeFi, and we believe the agentic layer will just automate that activity largely on SharpLink. Largely on Ethereum.

Yeah. There are so many aspects to agentic activity on decentralized rails. I will keep it fairly simple. As you suggested, autonomous AIs are going to want the best infrastructure that smart companies will choose, and that is a credibly neutral guarantee to execute, risk minimized. That is Ethereum. It can be Layer two's on Ethereum that inherit the security guarantees of Layer one on Ethereum.

If you think about DeFi, in a sense, blockchain and DeFi were not made for the bulk of humanity to interact with directly. It is sort of similar to the evolution of the automobile. It is a complex machine, mechanical and electronic, and it has been perfected by engineers so that with the use of automated transmission and even full self-driving, people are able to wield this incredibly complex and even dangerous technology relatively effortlessly.

You can imagine that the engineers, researchers of Ethereum and DeFi systems are putting together essentially the automated transmission and the full self-driving of finance. You will see that as agents handle all the heavy lifting and all the automated activities that make sure that your money is always working for you and is safe. In particular, my favorite wallet, MetaMask, has a system that does exactly that.

Really fascinating. Appreciate the responses, Joseph and Joe. A follow-up here, kind of, maybe say big picture, a little bit over a year into the treasury strategy, so maybe a good time to revisit big picture on why treasury versus passive ownership. I think it has obviously been a volatile backdrop for prices, and I think that can obscure the value, sometimes, at least optically, from the value created by active management. So would love to hear in your words how you would frame SharpLink's treasury performance relative to passive ETH ownership as an alternative. Then just looking ahead, I suspect maybe one of the silver linings to a difficult price backdrop is just there is less capital chasing opportunities.

If you can just maybe add some context on maybe how much incremental yield you think you have kind of stacked for the future, if you will, or just been able to negotiate ahead of the next phase of the adoption cycle. Obviously, we see all these partnerships, and so it seems like the firms you are probably getting today would be better than when things were really hot from a price perspective. So would love some context there. Thank you.

Sure. So Devin, owning SharpLink instead of simply buying ETH in the spot market or an ETF is a fundamental investment question. Owning ETH directly provides exposure to the asset, and our objective is actually to provide exposure to both the asset and additional value we can create uniquely through disciplined institutional capital allocation. We believe that we can create value beyond just passive ownership through three basic capabilities that, when combined, are compounding.

The first is just disciplined capital allocation. We raise capital when attractive, we can repurchase shares when appropriate, and we are continuously evaluating how to maximize ETH per share. Second is our treasury management is productive. Rather than simply holding ETH or staking part of it, we are actively putting our treasury to work through both staking and carefully selected institutional strategies that take advantage of, frankly, our comparative advantage, which is having permanent capital.

Many funds and ETFs cannot do that. They have to provide daily liquidity. They cannot do virtually anything beyond staking. Our goal is to earn incremental ETH over time in a way that an ETF cannot, or most users holding spot cannot either. Third is we provide access to ecosystem participation. We are helping build the infrastructure that we believe will accelerate Ethereum's long-term adoption while having access to differentiated investment opportunities for our shareholders. I really want to emphasize that. The deal flow that is coming to us is tremendous. I think in the last several quarters, we saw over 100 opportunities. We diligenced only about 12 of them, and you have seen the deployments we are making. If we execute well, and we are doing it in a very disciplined fashion, investors are not simply buying ETH exposure.

They are investing in a company who has a mission to compound that value through active institutional-grade management. I think it is highly differentiated and you will see over time that our competitive advantage of scale, liquidity, a public wrapper, and permanent capital will actually give us opportunities not to chase yield, but essentially to be rewarded for deploying in the long run and for long term. Devin, thanks for those questions.

Thank you, Joseph.

Thank you. Our next questions come from the line of Fedor Shabalin with B. Riley Securities. Please proceed with your questions.

Thank you very much, operator, and good morning, everyone. Mike, it was a great discussion from Devin and your answers, but my question is less, like you said, Fed, more granular, less strategic. First one is on the 125 million fund with Galaxy. Do you have a mini target return profile and risk budget? Maybe split between DeFi lending and liquid staking yield versus more structured exposure. How does capital in the fund interact with the core Ethereum treasury? Is this being redeployed out of existing ETH holdings, or funded somehow separately? Thank you very much.

Fedor, great question. We aren't going to actively disclose yield guidance. You can think of it as our success in this fund as another sleeve in a portfolio is going to be measured by long-term risk adjusted incremental ETH earned above the native staking rate. Again, incremental ETH returns above the native staking rate. We are capitalizing the fund with ETH, so we are continuing to get staking rewards on the ETH we deploy. The fund will borrow against that to do deployments. I believe most of the deployments are going to be on-chain, highly collateralized yield opportunities. I don't believe this is going to be another sleeve of liquid staking or restaking.

We're going to commit to support the cold start problem we've talked about in the past, which is new protocols needing to have a solid base of capital on which they can attract additional capital. If you do that right, you will end up getting better returns for your investors while still staying directionally exposed to ETH. We chose Galaxy in this format because they have capabilities to do even greater sourcing at scale, diligence at a level that as a public company with years of experience very few institutions have. Importantly, a risk management framework that we've agreed with them to continue to monitor these investments and to adjust them in real time as needed. We can do these deployments one, two, three at a time. They're going to do this deployment in much more scale.

For the day-to-day management of our portfolio, the strategic allocations, we've built the strongest in-house team and capability. But for specialized deployments and scale, we'll benefit from the value and the partnership with Galaxy. Again, we're not providing yield guidance, but we are seeking to outperform the long-term incremental ETH we can earn above the native CESR staking rate.

Thank you very much for this. My follow-up is, if you can talk a little bit more in details about funding to EthLabs, Ethereum Institutional, and EthSystems, and an expected duration of this. Is this kind of a short-term granting or ongoing annual commitment? Does it come out of treasury ETH or cash? What would be expected, call it payback, for SBET shareholders specifically? Is the status that this drives broad ETH price appreciation, which every ETH holder benefits from, or does SharpLink get kind of differentiated commercial access, maybe early access institutional flow through ETH traditional relationship or kind of privacy infrastructure from EthSystems? So that kind of other ETH treasury vehicles don't get. Thank you.

Sure. I think you should think of these as a very intentional and strategic allocation. They're intended to strengthen the overall infrastructure that supports our thesis, which is long-term Ethereum adoption by the world's largest institutions. These institutions who've spun off from the Ethereum Foundation needed longer term funding. We're supporting them not through charity or philanthropy. We're making one, two multi-year funding commitments alongside the ecosystem, including Joseph Lubin personally, Tom Lee at Bitmine, and in some of the cases, over 100 distinct anchor and additional supporters. They are fully economically aligned with what our shareholders expect because a stronger Ethereum ecosystem and narrative and storytelling and infrastructure can enhance long-term utility and the value proposition of ETH. Again, this is a strategic support investment, not philanthropy.

Our treasury strategy continues to remain focused on increasing ETH per share, and these ecosystem investments are a complementary way to help accelerate that adoption and the drivers that underpin our entire strategy. They don't provide us with any unique capability, profit sharing. They're meant to be run as independent, neutral companies. That is the beauty and the benefit of Ethereum. We are not controllers of these companies. That said, we'll have voices along with other ecosystem participants, and their objectives are going to be public, they're going to be open source, and they're going to be fully auditable. So, we'll have much more visibility into what they're doing, but also opportunities that spin out from these institutional adoption capabilities, and it'll be very accretive, we believe, in the long run for our shareholders.

You've already seen the sentiment shift from earlier this summer around Ethereum Foundation, some of the subtraction they were doing by getting more focused. You've seen the Ethereum narrative, and actual token price of ETH decouple and outperform, at almost exactly the same time that the ecosystem was doubling down into these spin-offs. We think it's really good for shareholders. It's been good for the price of ETH. We are being very supportive as institutional stewards, but not controllers of these organizations.

Thank you very much.

One way to think about the investment that SharpLink has made into these organizations is it's not very large in monetary terms, but it has been enormously powerful in terms of the coordination, the support that SharpLink personnel have provided and the role of catalyst in decentralizing the stewardship of the Ethereum ecosystem into multiple credibly neutral and other stewards. A lot of hard work went into it. The gains have, as Joseph indicated, already been quite large in terms of sentiment, but tremendous efficiency of investment from my perspective.

Thank you very much for the call and continued best of luck.

Thank you. Our next question has come from the line of

Good morning, everyone, and thank you for participating in today's conference call to discuss Sharplink's financial and operating results for the first quarter ended March 31st, 2026. By now, everyone should have access to the first quarter 2026 earnings press release, which was issued this morning at approximately 8:00 A.M. Eastern time. The release is available in the Investor Relations section of Sharplink's website. This call will also be available for webcast replay on the company's website. Following the management's prepared remarks, we will open the call for questions. I will now hand the call over to Sharplink's Vice President of Business and Legal Affairs, Dodi Handy, for introductory comments. Please go ahead.

Thank you, operator. Please see Sharplink's quarterly report on Form 10-Q filed on Friday, May 8, 2026 with the SEC, along with the earnings press release that crossed the wire this morning. These documents list some of the factors that may cause the results of Sharplink to differ materially from what we say today and identify some of the risks and uncertainties that could affect our business, prospects, and future results. Sharplink assumes no duty and does not undertake to update any forward-looking statements. Any forward-looking statement made by us during this call is based only on information currently available to us and speaks only as of the date when it is made. In addition, we may be discussing or providing certain metrics today, such as ETH per share and other treasury-related performance metrics that are not GAAP measures.

Please see our earnings press release and our SEC filings for further information regarding these metrics. To set the agenda for today's call, we will begin with Joe Lubin, Sharplink's Chairman, Co-founder of Ethereum, and Founder and CEO of Consensys. Joe will provide a broader perspective on Ethereum's technological evolution, ecosystem development, and long-term role in global financial infrastructure. Next, Sharplink's Chief Executive Officer, Joseph Chalom, will share his thoughts on the current market environment as well as Sharplink's active treasury management strategy and disciplined execution to date. Finally, our Chief Financial Officer, Bob DeLucia, will review Sharplink's financial results for the first quarter of 2026, along with key performance metrics related to our ETH treasury. I would now like to turn the call over to Sharplink's Chairman of the Board, Joseph Lubin. Good morning, Joe.

Thank you, Dodi, good morning, everyone. From my vantage point as Co-founder of Ethereum and Founder and CEO of Consensys, I want to take a step back and frame the broader technological evolution that is unfolding across Ethereum. What we're witnessing is the continued maturation of a global programmable financial infrastructure. Ethereum has become the foundation for a new class of markets built on transparency, composability, credible neutrality, and trust minimization. At its core, Ether is not just a digital asset. It is a productive, programmable financial primitive that powers this system. It secures the network, enables economic coordination across applications, and increasingly underpins a wide range of financial activity from stable coins to tokenized assets to decentralized finance. What differentiates Ethereum is the depth and breadth of its ecosystem.

The Ethereum Foundation, alongside a global community of researchers, developers, and organizations like Consensys, continues to lead in defining both the problem space and the solution space for decentralized systems. The pace of innovation and development has dramatically accelerated recently due to assists from machine intelligence. This includes advancements at the base layer, improvements in scalability through layer twos, and critical work around privacy, security, and long-term resilience. What's most exciting about Ethereum's recent trajectory is that the base layer is now scaling visibly and on a predictable cadence. Since May of 2025, Ethereum has shipped two consecutive on time hard forks, Pectra and Fusaka, raising L1 execution capacity and materially expanding data availability for Layer 2s.

The next major upgrade, Glamsterdam, is currently targeted for the first half of 2026 and designed to improve block processing and supporting upgrades that will enable higher L1 throughput in the future. Ethereum's advantage is not only that it has the deepest application, developer, and institutional ecosystem, it is also that the protocol continues to scale and harden at the base layer in parallel with advances at Layer 2. Recent advances in synchronous composability across L1 and L2s will soon enable cross-chain atomic transaction execution and unification of liquidity pools. An area that has received increased attention recently is quantum computing. While quantum represents a non-zero risk over time, it is important to separate signal from noise. There will be a great deal of frantic speculation and misinformation in this space over the coming years.

From our perspective, Ethereum is well positioned to lead the way for decentralized protocols into the post-quantum future. Becoming quantum safe won't be a detour for Ethereum. It is a natural outcome of the Ethereum roadmap involving real-time zero-knowledge proving of blocks designed to grow transaction throughput by orders of magnitude. The Ethereum ecosystem has been actively researching quantum-resistant cryptography for many years. A key design principle of Ethereum is cryptographic agility, meaning the network can evolve its underlying cryptographic primitives as new, more secure standards emerge. This is not a reactive posture, but something that has been anticipated and designed for. We are already seeing work across the ecosystem exploring alternatives to elliptic curve cryptography, including hash-based and lattice-based approaches. These are kinds of foundational upgrades that can be implemented over time in a measured and secure way, consistent with Ethereum's approach to long-term durability.

Ethereum is already ahead of both other blockchains and traditional systems in preparing for emerging risks like quantum computing. The ecosystem has been proactively developing quantum-resistant cryptography for years, supported by a core design principle of cryptographic agility that allows the network to evolve its security architecture as new standards emerge. This forward-looking approach positions Ethereum as a more secure and resilient platform relative to others, but it also reinforces the importance of building systems that are adaptable and future-proof. Unlike other blockchain technologies that are very likely to get slower in order to become quantum safe, Ethereum will scale up dramatically even while hardening against quantum computing threats. Beyond security and resilience, Ethereum continues to extend its lead across the dimensions that matter most. It has the deepest liquidity, the largest developer ecosystem, and the strongest network effects in decentralized finance, stablecoins, and tokenized assets.

It is where institutions are choosing to build, not just experiment. It is where new economic models, including agentic finance and autonomous on-chain activity, are beginning to take shape. As this ecosystem grows, we expect Ether to increasingly differentiate itself from other digital assets. While correlations may persist in the short term, the long-term drivers of value for ETH are fundamentally different. They're tied to network usage, economic activity, and the expansion of on-chain financial infrastructure. The number of transactions per day on Ethereum has risen steadily in 2026. As Ether and Ethereum bring far greater trust to on-chain transactions, processes, and agreements, various kinds of financial risks will be lessened or eliminated, and additional value will accrue to Ether in the form of a monetary premium. Over time, we believe this will lead to a meaningful decoupling to the upside from Bitcoin.

Bitcoin has established itself as a store of value. Ether is also a store of value, and Ethereum is a productive programmable platform powering a rapidly expanding digital economy. Ether's value is increasingly driven by the breadth and depth of activity happening on-chain. Ethereum is quickly becoming the settlement layer for the global digital economy, and Sharplink is positioned to translate that growth into long-term sustainable shareholder value. With that, I'd like to turn the call over to our Chief Executive Officer, Joseph Chalom, to discuss how Sharplink is positioned to capitalize on the Ethereum opportunity. Joseph.

Thank you, Joe. Good morning, everyone, and thank you for joining us. We are now approximately nine months into executing our Ethereum treasury strategy and importantly, doing so in a market environment that reflects strong long-term institutional adoption despite near-term crypto price consolidation. It is important for you to understand that Sharplink is building an entirely new category in public markets, an institutional-grade ETH treasury platform designed to materially compound ETH per share through disciplined capital allocation and best-in-class yield generation. Our strategy is simple: accumulate ETH accretively, make it productive, and scale that advantage over time. Today, I'd like to discuss our thoughts on where we are in the current crypto market cycle and how we're making our Ether productive as part of our active management strategy. As many of you are aware, the market is working through a meaningful de-leveraging cycle that began last fall.

Periods of excess leverage can take multiple quarters to fully clear through the system. While this has affected the price of Ether, our stock price, and broader sentiment towards the digital asset treasury sector, it does not change the underlying trajectory of the ecosystem. We believe we have largely moved past these de-leveraging impacts over the last few months. Ether has started a strong recovery due to that leverage mostly having been cleared from the system, as well as rapidly accelerating institutional adoption. The pace of institutional adoption cannot be overstated. With new announcements every day, the market is experiencing strong momentum across the four core pillars of growth: stablecoins, tokenization, institutional DeFi, and now agentic finance.

Stable coins continue to scale as a core settlement layer for global payments, with total supply now exceeding $320 billion and annual transaction volumes in the tens of trillions of dollars rivaling traditional payment networks. Ethereum sits at the center of this growth, hosting more than half of all circulating stable coin supply. This momentum is increasingly reflected at the institutional level. Hong Kong has granted its first stable coin issuer licenses under a dedicated regulatory framework for fiat-referenced stable coins. While in Europe, the ECB has moved to the next phase of the Digital Euro project, targeting a potential first issuance by 2029. These developments reflect a broader global shift towards regulated local currency denominated digital money. Tokenization of real-world assets is rapidly moving from concept to production.

Just in the past month, the New York Stock Exchange announced plans for a blockchain-based platform enabling 24/7 trading and instant settlement of tokenized U.S. equities and ETFs. Nasdaq launched an equity token design in March 2026, putting public issuers at the center of tokenized ownership. The DTCC recently announced plans to facilitate initial production trades of tokenized securities in July 2026, with a full service launch in October 2026, developed alongside more than 50 financial institutions, including Goldman Sachs, BlackRock, and JPMorgan. Ethereum has emerged as a dominant settlement and issuance layer for tokenized real-world assets, representing roughly 52% of the market by on-chain value. Institutional participation is accelerating in lockstep, with Bullish Global announcing a multi-billion dollar acquisition of transfer agent Equiniti to bring the traditional securities infrastructure needed to support tokenized markets at scale.

Institutional momentum in DeFi is following a similar trajectory, albeit with important lessons still being learned. Despite recent setbacks, the DeFi industry seems to be rallying to raise the standards that are necessary to support the next stage of institutional adoption of DeFi for borrowing, lending, swapping, and other financial activity. What's notable is that this is the ecosystem solving its own problems without government intervention or regulatory bailouts that have historically characterized crises in traditional financial markets. Sharplink was pleased to play a small part in helping advise through this crisis. Importantly, the vast majority of this DeFi innovation, liquidity, and institutional engagement continues to occur on Ethereum. In addition to the well-known use cases of stablecoins, tokenization, and DeFi, we're beginning to see the emergence of new categories and use cases on Ethereum, such as agentic finance and commerce.

As AI agents begin to transact, pay for data, access services, and coordinate with other agents, they will need programmable wallets, stablecoins, identity, and verifiable settlement infrastructure that Ethereum is uniquely positioned to provide given its security, liquidity, developer ecosystem, and composability. The scale of this opportunity is already becoming visible. Coinbase recently cited 167 million micro payment transactions processed by AI agents, a figure that would have been unimaginable just two years ago. With the recent mainstream adoption of AI agent frameworks, Ethereum has seen its fastest-growing period of unique wallet address activity in the first quarter of 2026. We expect the advancement of AI agents to meaningfully impact and accelerate Ethereum usage metrics in the near and long term. Finally, regulatory trends in the U.S. are heading in the right direction.

Senators Tillis and Alsobrooks released a compromise last week on the final major sticking points in the Digital Asset Market Clarity Act, with Coinbase and Circle immediately backing the deal and urging the Senate Banking Committee to advance to markup. Progress has been positive but slow. Its passage would extend the regulatory clarity established by last year's GENIUS Act across the broader digital asset market, a significant milestone for the industry. All of these tailwinds reinforce our long-term view. Ethereum continues to lead across these dimensions due to its security, trust, liquidity, and network effects. It remains the dominant settlement layer for institutional-grade activity across digital assets. For Sharplink, this is critical. We provide both institutional and retail investors the ability to express their views on this Ethereum opportunity through our public equity. We have built a foundation to operate across market cycles.

In strong environments, we can access the capital markets to raise equity and grow ETH per share in an accretive manner. In consolidation periods, our focus on productivity and optimized yield generation enables us to continue compounding ETH per share. We're designed to be productive in both environments. Which brings me to our active treasury management strategy. Our North Star has not changed. To compound ETH per share over time and maximize productivity with risk management being top of mind. We often describe our model as ETH-denominated beta exposure with an alpha overlay. We've often stated that in contrast with Bitcoin, ETH is a natively productive asset. You can stake your ETH on the Ethereum network and earn the Ethereum staking rate. From day one, we stake nearly 100% of our ETH.

What we have not shared is the operational depth required to do this safely at scale. Since launching our ETH treasury strategy, we've been singularly focused on building a durable and productive ETH accumulation engine. We've been doing that quietly and in a risk-managed manner. Sharplink aims to be the most sophisticated ETH capital deployer in DeFi, and we have the structural advantage of having long-term capital with scale. Unlike participants constrained by short-term liquidity requirements, we can deploy with a long-term horizon and structure bespoke opportunities that capture differentiated risk-adjusted yield. Sophistication means more than access, it means discipline. In a market structure where exploits remain a real risk, we apply rigorous due diligence to every deployment. We take a deliberate, patient approach to evaluating opportunities. We will not sacrifice quality for yield, and we believe this discipline is itself a source of long-term competitive advantage.

When we launched last June, we started with staking and liquid staking as foundational tools for making our ETH productive, using two well-respected external managers with whom we have had a very positive experience. As we expanded our internal management capabilities, we brought the majority of our treasury management activities in-house. Our team has since been active in sourcing and evaluating a robust pipeline of ETH productivity opportunities and are actively working on new ecosystem allocations. As an example, this morning we announced a non-binding memorandum of understanding for our first fund partnership with Galaxy Digital. Our diligence was supported by Crypto Insights Group, a top institutional due diligence firm specializing in digital assets. The Galaxy Sharplink Onchain Yield Fund will deploy roughly $125 million and be managed by Galaxy Digital's expert team.

Their team will source deals, evaluate risk reward, deploy capital, conduct risk management, and live on-chain oversight, as well as portfolio diversification and construction. The goal of this fund is to generate yield in a risk-minded way. It will provide liquidity to on-chain protocols, helping their cold start problem. Sharplink is contributing roughly 80% of this capital alongside Galaxy Digital as a limited partner. In exchange, the Galaxy Sharplink Onchain Yield Fund will receive economic incentives for being an early mover and providing longer-term capital than the industry has historically offered at scale. Since we are investing with our LSTs, we will continue earning the Ethereum staking rate and retaining our ETH exposure. We will measure the success of this fund to our shareholders by the amount of incremental ETH we can buy with the proceeds above what we would have earned through staking alone.

The opportunity cost is not U.S. dollars or just ETH. It's how much we generate above holding staked ETH for the period deployed. This is what ecosystem-aligned capitalism looks like. Industry participants working together to support the growth of on-chain projects through a sustainable, for-profit investment model. We believe this will be a highly effective partnership and look forward to sharing its progress over time. We selected Galaxy Digital following a rigorous and disciplined diligence process, which will serve as the benchmark as we evaluate future external strategies for a measured minority allocation of our treasury over time. Looking ahead, we expect to announce additional ETH allocations. Future ETH productivity opportunities may take different forms, including additional fund investment partnerships and active participation in on-chain vault strategies. Inbound demand and deployment opportunities have been strong, but we are not rushing. Operational rigor is non-negotiable.

As a public company, we work alongside leading legal, audit, and accounting partners, and every deployment must meet institutional standards. Again, as stewards of capital, we prioritize disciplined risk management over speed. I'll close where I began. Growing ETH per share remains our North Star, and doing so in a way that strengthens the Ethereum ecosystem is central to our mission. With that, I will now turn the call over to our Chief Financial Officer, Bob DeLucia, to walk through our first quarter 2026 financial results. Bob?

Thank you, Joseph. I'll begin by encouraging everyone to review our quarterly report on Form 10-Q for the period ending March 31st, 2026, which we filed this past Friday afternoon with the SEC. The 10-Q provides detailed disclosures and footnotes that complement today's discussion, offering stockholders and investors a comprehensive view of Sharplink's financial position, liquidity, and ETH treasury performance. We will now go through the financial results for the quarter ended March 31st, 2026. As we review our first quarter financial results, I'd like to remind everyone that all comparisons and variance commentary refer to the prior year quarter results unless otherwise specified. As of March 31st, 2026, Sharplink held 589,305 native ETH with a fair value of $1.2 billion.

In addition, we held 189,327 LsETH, or liquid staked ETH, and 66,102 of weETH, or wrapped Ether token, with a combined net cost value of $487 million. Subsequent to quarter end, our combined ETH holdings have increased to 590,824 native ETH, 209,788 as-if-converted LsETH, and 72,372 as-if-converted weETH, for a total of 872,984 ETH as of Monday, May 4th, 2026. Revenue for the quarter ended March 31st, 2026 was $12.1 million compared to $0.7 million for the quarter ended March 31st, 2025.

The material increase in revenue was primarily due to the continued success of our ETH staking strategy during the first quarter, including our $200 million deployment onto Linea Layer 2. We had a net realized gain for the three months ended March 31st, 2026 of $12 million. That was due to a combination of the redemption of LsETH into ETH and the conversion of ETH into weETH in the first quarter. Further, we had a $506.7 million unrealized loss at March 31st, 2026 due to the ETH market conditions that were soft during the first quarter of 2026. SG&A expenses in the first quarter were $9.9 million compared to $1.1 million in the prior year quarter.

The increase in SG&A was due to the expenses incurred in the implementation and the active execution of our ETH treasury strategy started during mid 2025. Net loss for the quarter ended March 31st, 2026 was $685.6 million versus a $1 million loss in the prior year quarter. Net loss for the first quarter of 2026 was driven by a $191.7 million impairment charge related to the lowest intraday pricing of LsETH and weETH during the first quarter of 2026, plus the previously mentioned net of the $12 million realized gain and the $506.7 million unrealized loss. As we previously mentioned, it is important to note that these impairment charges and unrealized losses reflect the current market pricing dynamics and follow the current US GAAP accounting standards.

They do not represent a realized economic loss on our ETH position, nor do they reduce the number of ETH units we hold. The success of our ETH treasury strategy is measured in the prudent ETH accumulation and measuring its productivity over time. As of March 31st, 2026, the cash on hand was $16.9 million compared to cash on hand of $28.5 million as of December 31st, 2025.

In addition to the SEC and the CFTC announcement that Joseph mentioned previously, I would also like to highlight the vote on April 15th, 2026 by the Financial Accounting Standards Board, also known as FASB, on their unanimous decision to move forward to expand the scope of their project, accounting for the transfer of crypto assets to address crypto assets that provide the holder with the right to receive another crypto asset like LsETH and weETH within the current fair value standard now being used for our native ETH assets. If adopted, this would align their treatment with the fair value framework we currently apply to our native ETH holdings, which we believe would improve the consistency and transparency of our financial reporting.

For additional details, our complete financial statements and accompanying footnotes, including all required disclosures and management's MD&A analysis, are contained in our quarterly report on Form 10-Q for the period ended March 31st, 2026, filed with the SEC. This concludes our prepared remarks. We will now open it up for questions from those participating on the call. Operator, back to you.

Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you please limit to one question and one follow-up question. One moment while we poll for questions. Our first question is from Brian Kinstlinger with Alliance Global Partners. Please proceed.

Great. Thanks so much. Can you talk about the benefits to launching the Onchain Yield Fund with Galaxy as opposed to Sharplink committing ETH directly into projects? Will there be an opportunity to increase the fund in size?

Great question. Thank you. Good morning, Brian. We took a step back and recognized that we have a really talented in-house team to deploy ETH to look at opportunities. Ultimately, the Galaxy Digital partnership is the first in scaling access to a larger number of high quality opportunities. Brian, what makes it compelling is that it comes with institutional diligence and risk management. It will provide us access through the fund to a larger number of early stage high quality opportunities within the Onchain Ecosystem, that's a big part of our ecosystem first approach as we try to build long-term value for our stockholders. This Onchain Fund essentially debuts a new type of capital to the market. Our goal is to help protocols break out from the cold start problem.

While VC funds, for example, target longer duration investments, they actually focus on higher risk, higher reward equity backing. Even with this funding, protocols find themselves in a feedback loop trying to get off the ground post-launch. That's what we call the cold start problem. Typical liquid funds can't provide this type of time commitment needed to get the protocols off the ground. We at Sharplink, because we have what we call near permanent capital or long-term capital, we're kind of uniquely positioned to provide that capital, in this case, with scale through the Galaxy-Sharplink Fund. Most importantly, as much as we could do some of this on our own, Galaxy has unique capabilities and scale. They have a position in the market alongside ours.

They also have good visibility into deal flow, and they have an ability to filter for the best opportunities in this space. We wanted to be selective, we want to be discerning, and working with Galaxy will basically be at the top of the funnel. That's why we decided to work with Galaxy and scale. Then your second part of your question, yes, this could be the first of additional funds with Galaxy or with other asset managers or through our own investment vehicles. The short story is, it's two public companies who are best in class partnering together to bring unique capital to the ecosystem with a level of diligence that you would expect from an institutional allocator.

That's great. Thank you. My follow-up would be, is there a way to think about what a reasonable annual or long-term yield might be on a fund like this, or is it too soon to say?

I think it's too soon to say. What I will say is it's part of an overall balance sheet, portfolio allocation, where, as I mentioned on my call, we started by fully deploying into native simple staking and liquid staking. You saw in January, we took a portion of our portfolio around 8%, and we put it in a composable liquid restaking token alongside Consensys Linea, ether.fi, and EigenCloud. You can think of this as the next step in that efficient frontier. It will be seeking higher yields than you would get in the standard Ethereum staking rate. Again, we're looking to hit singles and doubles. We're not looking for VC-like returns. That's how I would frame it.

I would share that in the future, we'll be more transparent as to what our collective yield and returns are as we complete these deployments. We will be more transparent. To date, we've been beating the Ethereum staking rate, and we intend to continue to do that as our benchmark and hurdle.

Great. Thanks so much.

Our next question is from Lance Vitanza with TD Securities. Please proceed.

Thanks, guys, for taking the questions. My question is, I guess, what in your view is the single most underappreciated driver of Ethereum demand over the next 12 months-24 months?

I think the most obvious answer would be stablecoins, and you're seeing them go from being a single-use crypto use case to essentially be a platform where lots of different types of payments will happen. It could be as simple as crypto pairs on-chain, but more importantly, you're starting to see it being used in cross-border remittances. You're starting to see them being used intra-company for treasury operations and optimization in corporates. You're starting to see them be used for corporate payments across borders. That is something that's very sustainable, very clear. You can almost argue it's the first proof case for tokenization. I would say the faster growing and bigger opportunity is tokenization of real-world assets.

To date, there's about $30 billion-$35 billion of on-chain, real-world assets that have been tokenized. You're starting to hear movements from the New York Stock Exchange, Nasdaq, DTCC, and just last week, a multi-billion dollar acquisition by Bullish Exchange of Equiniti, a traditional transfer agent, in fact, our transfer agent, all with the goal of doing step function change in tokenization. Now you have issuers, you have platforms, you have liquidity venues, and my expectation is that will be growing exponentially. Then the final thing, which I think is in the early stages, and it's too soon to forecast, is the growth in agentic payments.

You know, the Coinbase report a couple of weeks ago from Brian Armstrong said there were about 160+ million micro payments in agentic finance just in the first quarter, leveraging a protocol, an open source protocol called x402 for micro payments. These payments, whether they be stablecoins, transactions and tokenized assets, DeFi or agentic, need payment rails for settlement. To date, Ethereum has been the dominant platform capturing over 50%. I think it's those four pillars. Stablecoins are the most proven use case. I would say that tokenization is where we expect step function change. DeFi will be the rails in the future for stablecoins and tokenized assets to be traded and swapped and borrowed and lent. Agentic, I would say, is the wild card.

I can't tell you when, but it might be the most impactful over time. Ethereum is not only well-positioned, it has the license to win.

Thank you for that. My follow-up is, to the extent that activity increasingly migrates to Layer 2s, how confident are you that Ethereum captures sufficient value at the base layer? What, if any, evidence gives you that conviction today?

Well, I think we saw a intentional policy from the Ethereum Foundation several years back to help scale Layer 2s until such time as Ethereum Layer 1 or Mainnet had the throughput and a fee level that was necessary to support the activity. You've seen in the last several upgrades and what's coming next that Joe Lubin mentioned, Glamsterdam, you're seeing step function increases in throughput and a significant reduction in the cost per transaction. You'll have both the capacity and the economic incentives, and I would expect more and more activity over time to return to Ethereum Layer 1 Mainnet. That should inure to the benefit of not only Mainnet, but the Ether token that's used to secure those transactions. You know, years ago, you heard a lot of talk about Solana being faster and cheaper.

As these upgrades are happening, Ethereum is giving Solana a run for the money. In difference, in contrast, it has both the security, the developer community, and the staking ecosystem to provide economic security. We're quite confident that over time, more and more of the value will inure to the Layer 1, and that's positive for Ether, our treasury asset.

Thanks for taking the questions.

Our next question is from Devin Ryan with Citizens Bank. Please proceed.

Hey, guys. This is Neo Eloff on for Devin. Maybe my first question on agentic finance. You guys gave quite a lot of context in the opening remarks. I guess maybe you could talk a little bit more how you see it evolving over the next 12 months. Kind of sounds like payments is probably like the big pushing point, but maybe trading potentially as well. I guess could you also elaborate a little more on how you think Ether is best positioned here, maybe more from a transaction speed point as opposed to cost?

Yeah. I think we're still early, but it's unbelievably promising what we're seeing across not only agentic finance, but also commerce. You have, what I would consider a convergence of a handful of mega forces. The first just being the availability and growth in wallet on-chain infrastructure, smart wallets. There's somewhere between 600 and 800 million wallets, and they are growing quite rapidly. Those wallets contain both stable coins, Bitcoin, ETH, Solana, and other tokens. I think what you're starting to see is increasingly those wallets will act in a more autonomous manner, not on their own, not as the masters of individuals, but actually within the framework of x402 micro payments and a new protocol released on Ethereum called ERC-8004. These are the road rails of this agentic highway.

What you're gonna be seeing is both micro payments as well as, I believe, a higher transaction volume for people who are instituting or developing autonomous trading strategies. They need guardrails and they need throughput, and Ethereum Mainnet is offering that, but it will also happen on the Layer 2s. You're starting to see this happen on chain because of the confluence of the wallet infrastructure. You're also seeing AI agent infrastructure through Claude, through Anthropic. These capabilities being integrated with that wallet infrastructure. Finally, when you start seeing tokenization of assets, and I don't mean illiquid assets like real estate and private equity, but I mean ETFs, money market funds, as well as tokenized individual securities. You're gonna see this wallet infrastructure support things that you had only seen in institutional finance on Wall Street.

For example, the borrow or lend tokenized securities and funds for yield, just like institutions have been doing for generations or yield harvesting on chain in an automated manner, whether on DeFi or even just moving assets out of low yielding bearing accounts into higher yielding opportunities, including stablecoins. That confluence of a wallet infrastructure, the automation we're describing, as well as the throughput of Ethereum really creates a guide path of what we're gonna see in the future. I would also just add, you're seeing a wealth transfer that's gonna happen over the next decade to two of tens, if not $100 trillion of assets to a more AI native population. This confluence of events is only gonna accelerate agentic finance and commerce. Ether and the Ethereum opportunity are positioned to win.

I can't tell you the timeline, but I think we're probably underestimating the impact on our daily lives. That's gonna be very, very beneficial for Ether as a treasury asset.

Yeah. The timeline is ramping up now. From Consensys's perspective as we observe activity in the different MetaMask surfaces, whether it's an embedded wallet surface or APIs, SDKs or the actual mobile or extension client. We're seeing a lot of what we believe is agentic activity. We're a privacy tool, we're inferring certain things. A ton of agents are using MetaMask to do different things in the space. It's people and companies doing trading strategies, setting up vaults, adjusting vaults. We all need to be pretty careful.

As some of you have probably heard, an agent can take your instructions, read your instructions, maybe compact its memory and forget what you told it to do or not to do. While we've seen huge ramp up in payments, in ERC-8004, which Marco De Rossi at Consensys wrote, with Ethereum personnel and Google personnel, that is all super healthy activity. We're seeing some activity that really needs to be guardrailed. We launched a delegation framework and toolkit that enables you to guardrail what agents can do.

While we love our AI agents and other forms of machine intelligence, we really need to ensure that they don't do things that with either our own MetaMask wallets or MetaMask wallets that we give them, that are outside of proper behavior like exceeding their allowances or sharing information that they shouldn't be. Our ecosystem needs to take a prudent, careful approach, but it's happening really fast.

Thanks, guys. A lot of color there. Maybe just a short follow-up. It looks like traditional ETH is probably around a little bit below 70% of like the total ETH. Is there a number kind of in the long run that you're targeting as you like begin to diversify more into alternative ETH strategies?

I would expect into the long term that the vast majority of our ETH will stay in simple staking as well as liquid staking protocols. It does mean that a minority of our portion of ETH of our diversified portfolio can follow the strategies that we've done and new strategies. I do think that will be the minority of the portfolio over time. We're thinking of it as an efficient frontier. You know, each step we take is more sophisticated, requires more diligence. Again, on an overall basis, we're trying to exceed the Ethereum staking rate, but we're not trying to hit triples and home runs. We're trying to hit singles and doubles in a diversified portfolio. I believe the majority will stay in staking.

As we see opportunities, we'll be opportunistic, but we'll be prudent.

Okay. Thanks for taking the question, guys.

Our next question is from Fedor Shabalin with B. Riley Securities. Please proceed.

Thank you very much, operator, and good morning, everyone. My first one is kind of a high level. That's institutional adoption of ETH continues to build, yet token price has lagged the pace of that adoption. In your opinion, what explains the disconnect, and when do you expect it to close? Maybe which catalyst do you see as necessary to trigger the rating of the price of the token? Thank you.

Yeah, great question. We are seeing a divergence because all the real world signals around stablecoin tokenization, DeFi and the tail opportunity of agentic are all screaming that we're seeing a once-in-a-generation reset of financial rails. The vast majority of this stuff is happening in the Ethereum ecosystem. As I've explained earlier, it is leading by a wide margin in each of these domains. I think over the last year or so, both Bitcoin and ETH have become more correlated to macro geopolitical and liquidity trends than we had seen in the previous five to 10 years. At the end of the day, you know, we are trading in a band that is subject to short-term market structure.

I think as some of the short-term market structure works itself through, whether it was the de-leveraging we saw last October, whether it's some of the liquidity that's left the system and some of the geopolitical risk, we'll start seeing it trade more on its long-term fundamentals. As I mentioned on my earnings call, we think the market is working through the end of a multi-quarter de-leveraging cycle. It's obviously created a disconnect between price and the underlying adoption, fundamentals are strengthening. I've shared that earlier on my call. Historically, we've seen this pattern before where we've seen periods of consolidation followed by even stronger price appreciation and ecosystem growth. I think in my view, we are seeing at this point a temporary divergence between short-term market structure and macro and what the long-term fundamentals are.

As an Ethereum treasury, we are less focused on the day-to-day. We are here to deploy long-term capital into this thesis. We view this as a temporary dislocation and not in any way structural weakness. If anything, what you've seen is Ethereum over the last year, including the most recent releases and what's coming, really create a dominant throughput security and trust framework that other blockchains are really going to struggle to keep up with. I'd be more focused on what you're hearing from Larry Fink and the likes of Franklin Templeton and NYSE and Nasdaq and the DTCC than I would be in the short-term price movement. You can't overreact. You have to focus every day on what's right for the mid and long term, and that's to continue to invest in this institutional adoption. Again, a divergence between short term and long term.

We're always focused on the long term.

Let me pan out a little bit and put this in, into a longer time frame context. The world is in a complicated place. We're going multipolar in terms of power structures in the world. The world is really composed of platforms. It's platforms all the way down from software platforms like AWS, Instagram, Facebook, Twitter. Nation states are platforms. You can be deplatformed with respect to your citizenship or your voter rolls. That's what decentralized protocols, Bitcoin and Ether rose to address. The value propositions of Ether and Bitcoin are credible neutrality and censorship resistance. Bitcoin is censorship resistant and as neutral as it can be with respect to certain aspects of money, where Bitcoin is money.

Ether and Ethereum are censorship resistant and credibly neutral with respect to providing a decentralized platform for decentralized applications. That's all about moving many Web2 applications and elements of traditional finance and other elements of society to something that looks like Web3 or a decentralized worldwide web and to decentralized finance. To accomplish this, Ether and Bitcoin need to be rigorously decentralized. Because of their special period of initiation and time, they're the only two that have been able to accomplish that and protect that. Ethereum now has to scale transaction throughput massively, but not ever at the expense of the core value propositions of censorship resistance and credible neutrality. We've achieved that, and we continue to achieve that.

Ethereum has been slower as a Layer 1 than some other layer ones in scaling because Ethereum would not compromise its rigorous decentralization. The hard but necessary path is achieving global scale via many improvements at Layer 1, which are going on really rapidly right now, with some research breakthroughs, and via further scaling mechanisms at the modular Layer 2. The modularity at Layer 2 is incredibly valuable for scaling and providing different kinds of logical contexts for companies or nation states, et cetera. All of this is now taking shape in the form of Glamsterdam, the next hard fork, Hegota, hard fork after that, where we scale Layer 1, we scale blobs at Layer 2, and there's some specific pieces that protect censorship resistance.

We're at the point where we've essentially we're on the cusp of achieving two holy grails for blockchain. The first holy grail is unique, pretty unique to Ethereum. It's real-time proving of blocks at Layer 2 and at Layer 1. Real-time proving of blocks enables something that we're calling synchronous or near synchronous composability.

There are projects. We have Project Consensys, our friends at Gnosis have a project called the Ethereum Economic Zone, where we are unifying fragmented liquidity pools, and unifying execution context across different Layer 2 networks and down into Layer 1, where we can initiate a transaction or set of transactions at either Layer 1 or a Layer 2 and bring in transactions in the same execution context atomically, so that they can draw from different pools of liquidity and happen magically via zero-knowledge proofs effectively in a single transaction or in some transactions that are in the same block or in consecutive blocks. We are pretty much there. There's some details left to be worked out, but the unification of the Ethereum ecosystem, the Ethereum platform is underway.

Thank you very much. It's very helpful color related to architecture of ecosystem. My quick follow-up is, has an internal nature. About your partnership with Galaxy. With Galaxy running the funds investment management, what's left here for Sharplink in-house asset management team to do? Kind of maybe help us reconcile your focus on internal management of your majority of your assets with outsourcing this strategy to Galaxy. Thank you.

Sure. I think some of it is about the level of scale and diligence. We see a pipeline of opportunities, not just in staking, liquidity staking, and through our strategic partnership with Consensys. From time to time, we will partner with others. We are not outsourcing this to Galaxy. We founded the fund together. We are both limited partners in the fund, this is not gonna be a black box fund where we just wait to receive returns. While they are the general manager, the general partner and manager of the fund, we are both LPs, this is a partnership. That's why it's co-branded. We don't view this as outsourcing. We view this as an opportunity to capture on-chain yield opportunities and scale, frankly, in a way that others have not been able to do.

We're doing it with a partner we trust, with a partner that's best in class, and frankly, one that has skin in the game. I think what we're doing is first of its kind. But again, much of the asset management, in fact, the majority is happening in-house, but we will find select opportunities where partnering will yield better results for our investors. And we're doing it in a capital efficient manner. We will look at every opportunity at both the cost and yield perspective, and in this case, it made more sense to partner because of the scale we can provide to deploy to multiple opportunities within a single framework.

Again, you would have seen we've insourced the vanilla staking ETH purchases, but we will always use the best framework to generate the results. We don't see this as being inconsistent. We see it being entirely consistent in how to build an optimized portfolio.

I appreciate all the color. That's super clear. Thank you very much. Continue. Best of luck.

Our final question is from Joe Vafi with Canaccord Genuity. Please proceed.

Hi, this is Will Johnston for Joe. Thanks for taking my question. In the quarter, we saw some large DeFi exploits which put some pressure on DeFi TVL. I know you mentioned this plus some de-leveraging since last fall. Just wondering if you could provide some more color on, you know, these DeFi dynamics and how, if at all, this has changed your view on risk on layer ones versus layer twos and deploying ETH native versus liquid staking. Thanks.

Yeah, great question. Thank you Will. Actually very timely, and there's a reason we're doing this at this time. For more context, the recent hacks that involved the Kelp DAO were obviously unfortunate. That said, we have pretty institutional and advanced partner vetting, whether it be asset management partners, whether it be protocols. We have lots of internal controls and custody that's aimed to prevent us from having exposure to things like this. Obviously, none of our assets were in any way affected. That said, it was a major setback in the short term for the broader DeFi landscape. We're actually really happy to see fast-moving actors, high-quality actors who are part of what they call the DeFi United recovery efforts. We played a small part in helping advise on that recovery to stabilize the DeFi markets.

It's important to note these hacks, whether it be the Solana perp DEX on Drift, the Kelp DAO, they did not happen because of a smart contract exploit. The majority of these issues happened off-chain, essentially exploiting centralized points of failure, either at the social layer or how people, humans configured transfer of assets through bridging. The technology is secure in our view. The vast majority of these are not smart contract, they're human exploits. When you have centralization and social engineering combined with AI, this can happen, including off-chain. In our view, what is required is to continue to support further decentralization. In our view, the bar going forward needs to be higher. It needs to be at the Sharplink Galaxy institutional grade operational standard, and that's the standard we hold ourself to and our partners to.

We actually have worked closely through this situation. Our team worked closely with our strategic partner Consensys, along with Joe Lubin, who's on the call, who stepped in. We played a small part in helping structure the capital contribution with Aave. At the end of the day, we believe this is a net positive for the entire ecosystem, and it helped stabilize markets. At the end of the day, you've seen issues in both traditional finance and on-chain finance. Our top priority is to safeguard our investors and our balance sheet. We've taken an extremely conservative approach when vetting protocols. We've vetted dozens of protocols, most of which we turned away, and that will never change. Finally, it's worth noting that the security setup that was exploited in this most recent attack would not have passed our own due diligence checks.

For future deployments, we feel very comfortable with our risk management teams. We feel comfortable with our policies. In the case of the Galaxy Sharplink fund, we're working with a partner who has probably the largest on-chain security team for these type of deployments, and we're gonna use scrutiny and take our time rather than just prioritizing yields. When we look at future investment opportunities, the standard is gonna be high. Overall, when you have institutions like ours who are setting those standards, who are holding them rigorously, this is ultimately very good for the DeFi community 'cause you end up reinforcing those protocols who do things the right way. Those protocols who do not, will not deserve to get allocations of this type of capital. We're not shying away from this.

We're just doing it with a different set of standards than you've seen exploited in the past.

Great. Thanks.

With no further questions, I would like to turn the conference back over to Joseph Chalom for closing remarks.

First of all, thank you everyone. Before we close, I wanna leave you all with a very simple perspective. We are operating in a market that's still early, it's volatile, and its progress is being built out in real time. The direction has never been clearer, and it's becoming increasingly clear that Ethereum is emerging as the foundation for a new financial system, for new financial rails, and the opportunity ahead for Sharplink and our investors is extremely compelling. Our role is not to focus on or try to predict short-term market movements, but we are executing with discipline and consistency. Sometimes we slow down in order to speed up to build a platform that compounds value over time. We've built a model that's designed to perform across market cycles.

We're focused, again, on growing ETH per share, and we're grounding our strategy in making our ETH the most productive but in a risk managed and a repeatable way. We've been doing it this way from day one, and what we focus on is disciplined execution, responsible growth, and a real focus on long-term value creation for our shareholders. We are energized by the opportunity ahead, and we're confident in the path that we're on. Again, thank you all for joining us today, for your continued support in Sharplink's vision, and we look forward to updating you again in the next quarter. Thank you.

Thank you. This will conclude today's conference. You may disconnect at this time. Thank you for your participation.

Good morning everyone. Thank you for participating in today's conference call to discuss SharpLink's financial and operating results for the year ended December 31, 2025. By now, everyone should have access to the full year 2025 earnings press release, which was issued this morning at approximately 8:00 A.M. Eastern Time. This release is available in the investor relations section of SharpLink's website. This call will also be available for webcast replay on the company's website. Following management's remarks, we'll open up the call for Q&A. I'll now hand the call over to SharpLink's Vice President of Business and Legal Affairs, Dodi Handy, for introductory comments.

Thank you, operator. Please see SharpLink's annual report on Form 10-K filed last Friday afternoon with the SEC and the earnings press release which crossed this morning. These documents list some of the factors that may cause the results of SharpLink to differ materially from what we say today and which identify risks and uncertainties that could affect our business, prospects, and future results. SharpLink ascends no duty and does not undertake to update any forward-looking statements. Any forward-looking statement made by us during this call is based only on information currently available to us and speaks only as of the date when it is made. In addition, we may be discussing or providing certain metrics today, such as ETH per share, that are not GAAP metrics. Please see our earnings press release and SEC filings for further information regarding these metrics.

To set the agenda for today's call, we will begin with SharpLink's Chairman, Co-founder of Ethereum, and Founder and CEO of ConsenSys, Joseph Lubin. Joe will be providing a broader perspective on Ethereum's continued evolution and institutional adoption shaping the digital asset economy. SharpLink's Chief Executive Officer, Joseph Shalom, will discuss the company's strategy and execution as an institutional grade ETH treasury platform, including key accomplishments from the full year and our priorities looking ahead. Our Chief Financial Officer, Bob DeLucia, will review SharpLink's results for the year ended December 31st, 2025, and key performance metrics related to our ETH treasury. With that said, I'd now like to turn the call over to SharpLink's Chairman of the Board, Joseph Lubin. Joe, the floor is yours.

Thank you, Dodi, and good morning, everyone. As Dodi mentioned, I'm the Chairman of SharpLink, co-founder of Ethereum, and founder and CEO of Consensys. I've been involved with Ethereum since its inception, and I want to start by grounding today's discussion in what has fundamentally changed and why 2025 represented a decisive moment in Ethereum's evolution. This journey has not been and will not be linear. We can't ignore that price volatility is present, but it does not negate progress. Volatility is a feature of new financial architectures, particularly in their formative years. ETH is a foundational element of a startup economy, and when that economy becomes larger and more established, ETH will become far more valuable and much less volatile.

Even today, with the price volatility we've seen, it could not be clearer that Ethereum has become the financial backbone of on-chain markets and the dominant settlement layer for global digital finance. Ethereum and its Layer 2 ecosystem secure approximately 60% of all stable coins and tokenized real-world assets, and over two-thirds of total DeFi value. For much of the past decade, Ethereum and decentralized financial infrastructure was often described as an experiment or an impractical vision. With the adoption we're seeing, it is clear that phase is now firmly behind us. The decentralized trust that the credibly neutral Ethereum platform uniquely provides has scaled just in time for a financial system that desperately needs better forms of trust, interoperation, and collaboration. What we saw in 2025 is that institutional adoption profoundly accelerated.

This is visible in the media with the constant drumbeat of announcements from financial institutions, large and small. What is visible is only the tip of the iceberg. Institutions have gained experience with private permissioned Ethereum networks for years. In 2025, global regulators and legislators began to give institutions permission to build on and use public permissionless Ethereum in addition to more private and confidential networks, which will increasingly take the form of Ethereum Layer Twos. Top financial firms are not just facilitating investment in ETH, they're actively building on it. For example, just in the latter half of 2025, Fidelity launched a tokenized money market fund and built its stablecoin FIDD on Ethereum. BNY Mellon partnered with Securitize to launch a tokenized triple A-rated collateralized loan obligation fund on the public Ethereum blockchain.

J.P. Morgan Asset Management launched its first tokenized money market fund on the public Ethereum blockchain. BNP Paribas, Santander, ING, and other global banks started piloting stablecoin and tokenized deposit projects leveraging Ethereum and Ethereum Layer 2 solutions. Exchange traded products have expanded access, while tokenized funds, deposits, and even equities are increasingly settling on Ethereum rails. This distinction matters. Institutions are now using Ethereum infrastructure, creating long-term structural demand for both the network and its native asset, ETH. From a technology standpoint, Ethereum is scaling to meet the needs of major institutional players. Ethereum continues to advance performance and throughput through core protocol upgrades. The Pectra upgrade delivered meaningful improvements to validator performance, efficiency, and overall network capacity. The Fusaka upgrade, which went live in December, pushed that further with enhancements to data availability and execution.

Ethereum is becoming the settlement and coordination layer for agentic transactions as well. I'm excited to see the Ethereum Foundation's recent support of infrastructure to support this natural fit. AI agents begin to transact for their humans or autonomously, whether executing payments, managing portfolios, or coordinating across protocols, they require a settlement and operating environment that is programmable and permissionless. The combination of smart contract composability, deep liquidity, and battle-tested security makes Ethereum the most credible infrastructure for agent-facilitated and agent-to-agent economic activity at scale. Agentic transaction volume grows, it represents a meaningful new source of settlement demand that flows directly through the Ethereum network and of course, accrues value to ETH. Ethereum has done the hard work: liquidity, decentralization, security, uptime, and developer adoption over more than a decade of continuous, never down operation.

What we are seeing now is a convergence of technological maturity, regulatory clarity, and institutional appreciation and adoption. This huge ramp in attention from institutions is providing forcing functions that will rapidly drive improvements across the Ethereum ecosystem, from shorter staking exit queues to fast and synchronous composability across Ethereum Layer 1 and Layer Twos. With that, I'd like to turn the call over to our Chief Executive Officer, Joseph Shalom, to go further on how SharpLink will capitalize on this momentum. Joseph.

Thank you, Joe. Good morning, everyone. As Joe outlined, Ethereum has entered a new phase of institutional adoption, and SharpLink was purpose-built to operate with focus and discipline at both this moment in the market and for the long term. From the outset of our ETH treasury strategy, our approach has been deliberate and measured, prioritizing long-term value creation over growth of holdings for its own sake. Our objective is to accumulate ETH through accretive means and manage it responsibly with an institutionally governed public company framework. That performance and discipline are increasingly being recognized by the market. According to the latest Form 13F filings, our institutional shareholder ownership has grown to approximately 46% as of December 31st, 2025, the highest percentage of institutional holders of any Ethereum treasury company.

We believe this demonstrates that investors are actively differentiating SharpLink from the broader digital asset treasury category. As the space matures, we are seeing a clear rotation towards platforms that combine productivity, governance, and shareholder alignment. We believe we are positioned at the forefront of that shift. At a high level, SharpLink's value proposition rests on three pillars. First, structural ETH accumulation that is growing ETH per share in an accretive manner. Second, productive treasury management, generating yield above native staking rates through partnerships and innovation. This aims to ensure that the ETH we hold actively contributes to shareholder value rather than remain idle on our balance sheet. Third, strong public company governance and transparency. These are institutional controls and disclosures that our expert in-house team has put in place. Our North Star is clear: to compound ETH per share over time and maximize productivity of our balance sheet.

It is not to accumulate ETH at all costs or passively wait for ETH price appreciation. We approach this by redefining the efficient frontier of institutional yield, evaluating staking, restaking, selective DeFi, and actively managed allocation opportunities through an institutional risk management lens. We believe our differentiated treasury management approach will outperform other digital asset treasuries that are not engaging in active portfolio construction and management. Our scale, permanent capital base, and internal expertise enable us to structure bespoke multi-year deployment arrangements that are generally unavailable to individual investors or passive exposure vehicles. These deployments are designed to enhance ETH-denominated returns while maintaining discipline standards around custody, liquidity, compliance, and risk controls. A great example of this initiative is our deployment into ConsenSys' Linea Layer 2 chain, where we've allocated 200 million ETH in partnership with ether.fi and EigenCloud. To generate ETH-denominated returns that exceed standard staking rates.

This institutional-grade risk managed structure is secured within Anchorage Digital Bank, our regulated qualified custodian, and reflects the type of innovative opportunities we intend to continue pursuing and replicating as the ecosystem evolves. On the regulatory front, the passage of the GENIUS Act and continued progress around the CLARITY Act and related market structure legislation represent meaningful steps towards distinguishing decentralized digital commodities like Ethereum's native asset ETH from centralized token issuers. While the CLARITY Act has not yet passed and legislative outcomes remain subject to process, the overall direction is constructive. Greater clarity around market structure and digital asset classification will reduce uncertainty for public companies, asset managers, and regulated intermediaries. For institutions, regulatory ambiguity has historically been a gating factor more than market volatility.

Clear statutory definitions and emerging market structure frameworks will allow boards, compliance teams, and risk committees to further evaluate participation in the crypto ecosystem with greater confidence. As regulatory guardrails solidify, capital that has been sitting on the sidelines can engage through familiar governance, reporting, and custody standards. Regulatory clarity will lower friction, reduce perceived legal risk, and broaden institutional participation in the Ethereum ecosystem. As more institutional market participants are able to enter on-chain capital markets, SharpLink plans to continue growing its lead and executing on opportunities created by regulatory tailwinds. Through partnerships, on-chain deployments, and compounding yield strategies, we're on our way to becoming the world's most sophisticated bridge between traditional finance and crypto-native deployments. To execute on these opportunities, SharpLink has assembled a dedicated in-house institutionally experienced team with deep sophistication across capital markets, risk management, and digital asset operations.

Unlike many participants in this space, we manage the majority of our treasury activities in-house rather than relying on third-party discretionary managers or outsourced treasury platforms. We believe this is a structural differentiator for SharpLink and for our shareholders. Many digital asset treasury companies externalize treasury management to third-party sponsors under exclusive long-term arrangements that include high fees or revenue sharing. That structure can create a compounding value leak that works against stockholders over time. We built our platform internally with a more of a fixed cost base so that the value we generate stays within the treasury and compounds for our stockholders. Our economics are aligned directly with our shareholders. This internal treasury model gives us greater control over execution, tightens risk oversight, and has better alignment with public company governance.

We believe this structure will become increasingly important as investors differentiate digital asset treasuries based on governance, cost efficiency, and true value creation per share. Ethereum, like all transformative technologies in their early adoption, experiences periods of heightened volatility. We have all felt the recent drawdown in ETH price and other crypto assets. SharpLink is not immune to that. Our financial results will naturally reflect this volatility through unrealized gains and losses that can move materially from quarter to quarter. Our strategy is designed to operate through up cycles and down cycles, not to react to them. We believe SharpLink is both a pro-cyclical and counter-cyclical investment. In strong markets, we can efficiently access capital markets to grow ETH per share in an accretive manner.

We demonstrated this in 2025, raising roughly $2.1 billion in equity capital via our at-the-market facility. Our constant focus on productive treasury management is important regardless of the market regime. Putting our ETH to work and generating incremental ETH enables us to grow our ETH per share metric in both bull and bear markets alike. In more challenging markets like we have seen in the last few months, this focus on productivity and risk-adjusted yield becomes even more important and is a key differentiator for SharpLink. We believe it's important for the market to distinguish between short-term price movements and the long-term value creation. Our belief is that a lot of the volatility we've experienced recently is related to the ripple effects of the liquidations and deleveraging we saw on October 10th of last year.

That day was the single largest deleveraging event in our industry's history. Similar to what we saw at the end of 2022, it can take several months for the system to fully unwind and rebound following an event like this. We believe strongly in the long-term Ethereum opportunity. Our premise is simple. You can get beta exposure to ETH by investing in SharpLink and own more ETH per share tomorrow than you do today through our disciplined active capital management. It's also important to emphasize we don't attempt to call bottoms or predict short-term market movements in the price of ETH. Ethereum remains a volatile asset class. Periods of drawdown are part of its historical cycles. What gives us conviction is not short-term price action, but structural macro trends, institutional adoption, regulatory clarity, the growth in stable coins, tokenized assets, and DeFi participation.

Whether this crypto price consolidation proves to be a temporary noise or a longer-term cycle, our focus remains unchanged. We compound ETH per share through disciplined capital allocation and productive treasury management. Volatility is not a flaw of this asset class. It's the byproduct of monetizing a rapidly emerging and innovative new financial system. Our role is to harness that volatility through disciplined capital allocation rather than simply react to it. We have also taken steps to ensure that our name and brand accurately reflect who we are today. Last month, we formally updated our branding and digital presence, including the launch of a new website and adoption of our new tagline, Ethereum with an Edge.

As part of this process, we've also removed the word gaming from our corporate identity, reflecting that our strategy, capital allocation, and long-term value proposition are now centered on Ethereum and the digital asset treasury management segment. This rebranding is not cosmetic. It is fully aligned with what SharpLink has been building since June of last year and a signal of our continued commitment to building an institutional-grade ETH treasury company. We would be honored if you thought of us as your sharpest link to growing your exposure to ETH, the foundational asset of the emerging decentralized economy. Looking ahead, we remain focused on executing with consistency and clarity as the Ethereum ecosystem continues to grow and scale.

We believe SharpLink is uniquely positioned to provide investors with institutional-grade exposure to Ethereum through a transparent, publicly traded company offering stockholders a disciplined and risk management way to participate in the long-term growth of the Ethereum network and opportunity. We are also prioritizing the expansion of productive ETH deployment strategies, deepening institutional partnerships, and maintaining capital market flexibility to increase ETH per share. Finally, I'd like to really acknowledge the stellar efforts of our entire team for working relentlessly over the past year and in a really focused manner to build our new ETH treasury strategy. Importantly, we do it in an investor-aligned manner. With that, I'll turn the call over to our Chief Financial Officer, Bob DeLucia, to walk through our full 2025 financial results. Bob?

Thank you, Joseph. I'd like to remind our listeners to review our annual report on Form 10-K as of and for the year ended December 31st, 2025, which we filed Friday afternoon with the SEC. The 10-K provides detailed footnotes and related disclosures that complement our discussion today, offering stockholders and investors a comprehensive view of SharpLink's financial position, liquidity, and ETH treasury performance. We will now go through the financial results for the year ended December 31st, 2025. As I review our full year results, I'd like to remind everyone that all comparisons and variance commentary refer to the prior year period unless otherwise noted. As of December 31st, 2025, SharpLink held 640,026 ETH with a net fair value of $1.9 billion.

In addition, we held 204,409 LsETH or Liquid Staked ETH with a cost value of $501 million. Subsequent to year-end, our combined ETH holdings have climbed, standing at 604,618 ETH, 208,893 as-if converted LsETH, and 55,188 as-if converted WETH for a total of 868,699 ETH as of Monday, March 1, 2026. Revenue for the year ended December 31, 2025 was $28.1 million compared to $3.7 million for the year ended December 31, 2024.

The increase was due to the success of our ETH staking strategy during the year, with staking revenues increasing to $15.3 million in the fourth quarter from $10.3 million in the third quarter of 2025, an increase of nearly 50% between the third and fourth quarters. We achieved this growth even as the ETH market price was falling. We also had a net realized gain for the year ended 2025 of $55.2 million that was due to the conversion of ETH into LsETHs and the redemption of LsETHs in the fourth quarter. Further, we had a $616.2 million unrealized loss at December 31st, 2025, due to the ETH market conditions that deteriorated during the second half of 2025.

SG&A expenses for the year ended were $42.3 million compared to $5.7 million for the year ended December 31, 2024. The increase in SG&A was due to the expenses incurred in the implementation of our ETH treasury strategy during 2025. Net loss for the year ended December 31, 2025 totaled $734.6 million versus a net income of $10.1 million in the previous year. The net loss was primarily driven by a $140.2 million impairment charge related to the lowest pricing of LsETHs and the previously mentioned $616.2 million unrealized loss.

These charges and losses were offset by a realized gain on the conversion of ETH to LsETHs and an LsETHs redemption during 2025 of $55.2 million. It is important to emphasize that the impairment charges and unrealized losses reflect market pricing and follow the current US GAAP accounting standards. They do not represent realized economic losses on our ETH position, nor do they reduce the number of units of ETH we hold. The success of our treasury strategy is measured in a disciplined ETH accumulation, measuring its productivity over time and not based on short-term market fluctuations. As of December 31, 2025, cash on hand was $28.5 million compared to cash on hand of $1.4 million as of December 31, 2024.

Additionally, at December 31, 2025, we held $1.9 million in USDC stable coins as a financial asset. For additional details, our complete official audited financial statements and accompanying footnotes, including all required disclosures, risk factors, and management discussion and analysis, are contained in our annual report on Form 10-K for the period ending December 31, 2025, filed with the SEC. This concludes our prepared remarks. We will now open it up for questions from those participating on the call. Operator, back to you.

Thank you. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you each keep to one question and one follow-up. Thank you. Our first question comes from the line of Fedor Shabalin with B. Riley Securities. Please proceed with your question.

Thank you very much, operator, and good morning, everyone. My first one is on capital rising. If the stock remains range bound at these levels, are you evaluating alternative capital rising ways, just secured lending against the ETH treasury or other non-dilutive instruments just to continue growing ETH concentration, develop server, pressing the equity? More broadly, can you frame for us what the 2026 capital plan looks like in terms of magnitude and mix? Thank you.

Good morning, Fedor. Our approach to raising capital is actually very straightforward and disciplined. We will access the equity markets when doing so is clearly accretive to our ETH concentration per share. That is our governing metric and our North Star. If the issuance of new equity capital increases ETH concentration on a per share basis, we'll act decisively. If it does not, we won't. Capital markets activity is therefore very, very market dependent and not strategy dependent. We do not issue equity to grow the balance sheet or simply to pursue scale for its own sake. The $2.5 billion we raised earlier in 2025 was executed under really favorable market conditions and increased our ETH per share in a meaningful way.

Going forward, we're gonna use the same discipline and apply it, whatever the market condition is. Growth and accumulation is a byproduct of accretion. Growth and accumulation for its own sake is not the objective. Our North Star continues to remain compounding ETH per share over time. The second question was about essentially leveraging our balance sheet to borrow against our ETH to raise capital. At this point, we haven't decided to do that, but we maintain the flexibility in relationships with the market to do that if it made sense.

Thank you very much. That's helpful. My follow-up in the context of one of your strategic objectives for 2026, specifically on the expansion of partnership opportunities with Ethereum ecosystem, and I guess this one is for Joe Lubin. Given your history as an Ethereum co-founder alongside Vitalik Buterin, could you help us understand the nature of your current working relationship with Vitalik? Specifically, does your proximity to a core technical leadership give SharpLink any informational or strategic advantage when it comes to anticipating protocol level changes like upgrades or maybe shifts in the ETH roadmap that could impact the value or utility of a treasury? More broadly, should investors view SharpLink as having a collaborative relationship with Ethereum's technical leadership, or is the treasury strategy operating independently of those ties? Thank you.

Yeah. Thank you for that question. To the extent that our company Consensys is deeply expert in the Ethereum protocol, Layer 1 execution, Layer 1 consensus, and deeply expert in Layer 2 ZKEVM protocol technology in the form of Linea. To the extent that personnel in our protocols teams, our Linea team, our MetaMask team are constantly in contact with not just Ethereum Foundation researchers and other personnel and other leaders across the ecosystem regarding the advancement of the protocol. We have contributed, I think, second only to the Ethereum Foundation in terms of advancement of the protocol.

We certainly believe that we have, if not an advantage, at least we are deeply aware of what's going on in the ecosystem and able to shape it for the benefit of the ecosystem, which is really all about maintaining rigorous decentralization, credible neutrality, censorship resistance. The stronger Ethereum is, the more it will continue to win. SharpLink is 100% dedicated to the health of the Ethereum technology. We believe that SharpLink shareholders will benefit from that perspective.

Well, that's clear. Thank you very much. Continue. Best of luck.

Thank you.

Thank you. Our next question comes from line of Devin Ryan with Citizens JMP. Please proceed with your question.

Thank you. Good morning, everyone. First question, just on ETH, kind of price. You know, a lot of the price action still feels dominated by positioning macro flows. It's a question I am asked frequently. It's just when we'll see correlations break down where everything doesn't just trade with Bitcoin's price. Yeah, I'm curious, you know, if there's a threshold that you're thinking about where fundamental ETH demand becomes large enough to offset some of the speculative flows around the edges that are, you know, obviously impacting price. Are there any metrics of kind of real demand that you would kind of point out as key indicators or that we should be tracking? Then just how does that inform kind of the treasury management decisions as well? Thank you.

Sure. Thanks, Devin. We recognize that first of all, ETH is very volatile. It's actually a feature of this asset class. For a long time, ETH traded pretty linearly and correlated with Bitcoin. We're seeing more correlation actually with macro factors than we had in a long time. Obviously we're going through a period of de-leveraging since October 10th, and that typically takes months or even up to 2 quarters to work its way through the system. I think the leading indicator we would ask our investors to focus on is that macro Ethereum adoption opportunity, what we like to call and others refer to as the super cycle. There seems to be a bit of short-term divergence between the price of crypto and the adoption that we're seeing.

I feel pretty strongly that we've never had a period of time in the history of crypto where institutions are more attuned, institutions are allocating, no longer experimenting in the Ethereum ecosystem. Joe laid out in his introduction just a handful of institutional use cases. We're seeing it across stablecoin growth, where most of the stablecoin activity is happening in the Ethereum ecosystem by a large margin relative to the next two largest blockchains. Second is, we're seeing tokenization at what I think is a very, very early stage of a step function shift. Historically, we've seen individual funds, individual tokens, be tokenized on disparate platforms. Now we're hearing about the largest asset managers essentially saying that they have plans to tokenize all their assets.

I think we're looking for signals, but they're loud and clear that we're talking about potential tokenization of fund complexes. The reason why that matters is Ethereum is the leading ecosystem for tokenization. The final thing is DeFi, what we like to refer to as good DeFi or institutional DeFi. We're starting to see larger and larger institutions start participating. All of this bodes well for the Ethereum network, for activity, for total value locked, and that should benefit the price of Ether. That said, we're not in the business of calling bottoms. We're not in the business of making price predictions. The macro tailwinds are stronger than we've ever seen, despite the short-term volatility and price consolidation. We don't drive our business model based on the price of Eth.

We just wake up every day trying to give our investors smarter beta exposure to the price of ETH, and then we make it productive in what we think of as almost an alpha overlay strategy, being more productive than retail investors can do themselves, or that they can achieve through exposure, for example, through an ETF.

That's great color. Thank you, Joseph. As a follow-up, we just wanna hit on kinda yield above, you know, kinda native staking. You guys in the prepared remarks outlined some of the focus areas and kind of action plan. Can you just give a sense of how we should think about kinda the yield stack evolving through 2026? I don't know if there's a way to kinda quantify the different buckets and kinda orders of magnitude. Then just interrelated, you spoke about potential partnerships that you're working on. You know, how could those also help accelerate the strategy there? Thank you.

Sure. It's a great question, and I think we wanna be a little bit more transparent now that our strategy is growing and maturing. I would say that native staking of our ETH remains our baseline. I think we've said publicly multiple times since inception in June, we've been staking nearly 100% of our ETH, because if you have a productive asset like ETH, it's respectful to investors to stake as much as you can. Not all of our competitors have been doing that. Beyond that, we've selectively deployed some of our ETH capital into institutional grade structures.

We shared that publicly that we did a large $200 million deployment from our balance sheet into a partnership with ConsenSys, their Linea blockchain, and two blue-chip DeFi protocols, ether.fi and EigenCloud, in order to be able to deploy permanent capital. Meaning provide liquidity and protocol commitments for a multiple year periods. You get the liquid restaking rate, on top of that, you get economic incentives denominated in ETH. We didn't have to compromise on operational risk. We were one of the first public companies to deploy into DeFi within our regulated qualified custodian at Anchorage. I think as we think about 2026, we are gonna move a little bit further along the efficient frontier to drive additional yield for our investors, but we do it through four lenses.

First is we always look at counterparty risk controls, which is really, really important in the crypto ecosystem. We look at how we can maintain operational protections through our regulated custodians. We look at liquidity parameters of the partnership or protocol, and we always look at regulatory considerations. Again, no matter what the staking yield is, it's our hurdle rate and our objective is to generate yield on a risk-adjusted basis above the native staking rate in a very disciplined risk-adjusted manner. You'll see we will be doing more partnerships in the ecosystem because we have something quite rare in the digital asset space, which is permanent capital, and we'll make it useful on behalf of our investors. That actually is our comparative advantage.

Excellent. Well, appreciate the detailed responses.

Thank you. Our next question comes from the line of Brian Kinstlinger with Alliance Global Partners. Please proceed with your question.

Great, thank you. Can you talk about the pipeline of the yield generating ETH deployments and partnerships, and help us understand the time it takes to do due diligence on the associated risks? My second question, which is related, does the pressure on ETH make these types of deals more or less attractive to either side of the transaction, or does it have no impact on demand for such transactions? Thank you.

Sure. We have built an internal team that has both investment management capabilities from both traditional finance and digitally native members. We have a DeFi team who's focused on sourcing these opportunities, and I would emphasize what Joe Lubin said earlier. Many of these opportunities are being sourced in conjunction with our strategic partners at Consensys. They have the deepest access to these protocols. We are looking at, I would say, almost 12 different protocols and opportunities, and it takes at least two months to do the proper due diligence. First is you need to get comfortable that they have the risk controls that you would expect. We diligence things like smart contract risk, counterparty risk, liquidity risk, sometimes de-pegging risk.

We get to the point where we feel comfortable and you negotiate commercial relationships to try to leverage our scale and permanent capital to get a better yield or return on a risk-adjusted basis. Finally, we often work directly with our custodians to see if they can support it within the qualified custodial wrapper. It's important because in crypto, where there's heavy risk in DeFi protocols, if you can reduce your custody and operational risk, we think of that as operational alpha. That is question number one. Question number two is, I mentioned earlier the rate of return on staking will vary over time. You're seeing a very large rush into staking with staking utilization rates higher than we've seen in most of the history of Ethereum.

That's because of the dApps and the ETFs but again, that is our hurdle rate, and our ability to generate returns are less sensitive to short-term movements in the price of ETH or staking rates because we're negotiating and deploying under multi-year agreements. We're making a lot of progress, but we're gonna do it in a very disciplined manner. That's who we are and that's our strategy.

Great. Thank you. Let me add to that I didn't mention DeFi that much in my previous response. Not only are some of the best minds in DeFi at Consensys available to SharpLink, but some of them have actually moved over from Consensys to SharpLink. Great. Thank you.

Thank you. Our next question comes from the line of Brett Knoblauch with Canaccord... I'm sorry, Cantor Fitzgerald. Please proceed with your question.

Hi, guys. Thanks for taking the question. Can you provide any color on the difference in staking yields you guys earned in the fourth quarter between native and liquid staking? More specifically, just how much greater is the liquid staking yield on top of native staking?

We haven't yet disclosed that. Part of the fourth quarter was still in deployment. We've also been, in many cases, renegotiating our staking rates and incentives, so I don't have those numbers at hand. I think what you're gonna see is later this year, as we reach a steady state, we will likely start disclosing more frequently how we're doing in terms of our overall portfolio staking, liquid restaking, Linea and any other capital allocations, 'cause we do think of it as a portfolio of returns.

Great. That makes sense. Kind of a follow-up to that, could you maybe talk about the willingness to explore DeFi opportunities on the ETH Layer 1 itself versus Layer 2s like Linea going forward?

I think today most of our staked ETH is done through Anchorage and done through Coinbase on a delegated basis, and they use a series of validators that are diversified and a series of validators that are generating optimal yield. That happens, to my knowledge, largely on Mainnet. We're very flexible, whether it's the Layer 1 or Layer 2, in order to achieve the highest risk-adjusted returns. As Joe mentioned earlier, we are starting to see really good opportunities in DeFi, but we're being patient and doing the proper due diligence because it does introduce risks beyond the native staking. We're thinking of this as a portfolio of allocations, and we're trying to push the efficient frontier, but to do so in an institutional grade manner.

Great. Thank you, guys.

Thank you. Our next question comes from line of Joseph Vafi with Canaccord Genuity. Please proceed with your question.

Hey, guys. Good morning. Just let me double-click on CLARITY, what it may mean for the broader ecosystem. I know you mentioned it, but just maybe we drill down on it a little bit and how maybe that evolves post CLARITY. I know it's super early, but you did mention, you know, AI and the like. We're just wondering if you're seeing any pilot projects related to, you know, perhaps some, you know, AI entering into, maybe DeFi or other, you know, more permissionless, payments schemes or algorithms? Thanks.

Sure. I'll take the first question, which is regulatory clarity, and then I'll pass it over to Joseph Lubin to handle the agentic dimension and how we're seeing it evolve. On the regulatory clarity, I think if we look back, the GENIUS Act was a very, very good step. It was not only a good step in clarifying, you know, stablecoins in the U.S., I think it was setting off a bit of a geopolitical race because we're starting to see countries around the world focus on locally denominated stablecoins. The growth in stablecoins from what today is around $310 billion to what Secretary Bessent thinks will be several trillion over the next few years is going to happen not only in the U.S., it's going to happen globally.

We're seeing that in Korea, we're seeing it in Japan, we're seeing it in Hong Kong, and to a lesser extent in Europe. That is one set of drivers. I would say the CLARITY Act, which is trying to provide both market structure and token security classification, is important as much as a signal as it is to make sure that institutional investors are comfortable that when they invest in crypto, they have the regulatory clarity behind them. I won't predict whether the CLARITY Act will pass before the midterms. I think there's a high level of confidence it will pass this year.

I do have pretty strong conviction that even in the event it does not pass, we've heard from both the SEC and the CFTC, the two primary U.S. regulators, that they're not only saying they're working in unison, they put working groups together. If necessary, I feel confident they can do through rulemaking what the legislative branch has not been able to accomplish yet. I think we have institutional adoption tailwinds, and I believe we have regulatory tailwinds that are gonna be very, very positive for both stablecoins, tokenization of traditional funds, stocks, commodities, as well as institutional participation in DeFi. We may need to be a little bit patient, the trend is behind us.

With that, I'll turn it over to Joe to speak a little bit more about what we're seeing in the agentic economy on-chain, and specifically what we're seeing in Ethereum.

Thanks, Joseph. Thank you for the question. There is just so much to discuss at the intersection of AI and crypto. I'll try to keep it fairly short. The bottom line is that AI and crypto, at least in my opinion, badly need each other. These are two foundational technologies that could each reform that society alone. We should recognize as a society, as technologists, what I think of as the necessary complementarity of decentralized trust, as represented by blockchains and the unprecedented centralized intelligence, power and control that AI enables the crypto space.

I think most of the initiative is coming more from the crypto space than the AI space, although there's certainly a lot of AI researchers that think about decentralization. The crypto space will empower a healthy evolution of human and machine intelligence and economic and financial agency. It needs, in my opinion, it really needs AI to fully flourish. The world needs decentralized protocols and decentralized infrastructure to empower humans and communities with full agency. These humans will be bonding deeply with AI to ensure that hopefully AI will be user-centric and not continue in the exploitive and toxic directions that Web2 plus AI has become.

Crypto will fix AI's centralization problem by providing decentralized compute, data sourcing, training and inference on decentralized physical infrastructure networks or DePIN via zero-knowledge proof technology. Crypto enables secure data and private data markets through federated learning and zero-knowledge machine learning. AI can be trained on sensitive proprietary data without ever exposing the underlying information. We at ConsenSys are doing work with the x402 protocol enabling micro payments for agent-to-agent commerce and human-to-agent commerce. We've participated in building ERC-8004, which is essentially a registry system for agents to register themselves and their capabilities. It's a reputation system so that people, companies, and agents can feed back on how the agents are doing. AI fixes what we could think of as crypto's usability problem.

We're moving to intents-based, you know, user interface and user experience. That means that AI will help us by explaining and handling complex, highly technical blockchain transactions and do so in natural language. Users can simply say or type what they want to achieve, and their AI agent, which might be their digital twin, will be able to translate that and execute it for the human. AI will help transform crypto wallets into neobanks and intelligent financial advisors that you fully own and control. These wallets will guard users from security risks. I can go on and on, but let me leave it there.

Maybe the last thing to add is that the AI-enabled velocity of software development is off the charts right now, and it's accelerating. For instance, developers at Consensys and across the Ethereum ecosystem are reporting 2x or more speedups in software development velocity. Look for that to continue and look for the quality of software to improve.

Great. Thanks for that color, Joe. It sounds like there is a tremendous amount going on there. Thanks, Joe and Joseph.

Thank you. Our next question comes from the line of Kevin Dede with H.C. Wainwright & Co. Please proceed with your question.

Good morning. Thanks for having me on the call. I know, Joseph, you offered a little color on the Consensys partnership and then Consensys people joining your staff and working with ether.fi and EigenCloud. I was just wondering if you could kind of break down how you're approaching DeFi from a broad brush strategically, given partnerships and internal personnel, and then specifically, how are you leveraging liquid versus wrapped?

Sure. I'll take that. There's a word in crypto that's used quite often, which is composability. When we approach partnerships, it's often not to a single protocol. The example we gave was working with ConsenSys, their Layer 2 zkEVM chain, as well as two blue chip DeFi partners. I think that's a model that is repeatable. The reason why we're seeing that is a lot of crypto and protocols are starved of liquidity, especially since October tenth. What they're looking for is an ability to have permanent capital. The crypto ecosystem often is plagued with folks that will put money in protocols, essentially try to generate as much quick yield, whether in token value or otherwise, and then they move on from protocol to protocol.

What we're seeing is a lot of demand from DeFi protocols for multi-year permanent capital deployments, and they're willing to pay incentives to do that. We are being approached by virtually every sophisticated DeFi protocol vault provider to try to find ways to partner, and that actually puts us in a pole position. I'm quite confident that over a period of time, we are building a portfolio that is actively managed, which is in contrast with, you know, how individuals or ETFs can give exposure to ETH productivity. I think that will be very, very positive for our investors. I think it's less around, you know, standard staking, liquid restaking. It's more often the composability of bringing partners together to look at yield opportunities, less around the wrapper, more about risk-adjusted returns.

We will try to be as public as possible when we enter into these partnerships because that is our comparative advantage. It's less about the wrapper, it's more about the risk-adjusted return and how each one of these deployments fits into a diversified portfolio management or portfolio allocation framework. It is a portfolio of capital, and we're gonna deploy it to our comparative advantage. If you do that right, it's really respectful and beneficial for our investors.

Thank you. Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Shalom for any final comments.

Well, before we close, I want to emphasize that we are building SharpLink for a world where Ethereum is at the core of the future innovative financial infrastructure. Our job is to be the stewards of our stockholders' capital and our ETH treasury with the North Star that we say over and over to increase ETH per share responsibly. We believe SharpLink is the smartest way for investors to participate in this long-term Ethereum opportunity. At our core, we are Ethereum with an Edge. Thank you all for joining us today for your continued support and confidence in our vision and strategy. I'm really proud of the work our team has accomplished in 2025, and I'm optimistic and excited for the opportunities ahead in 2026.

We look forward to speaking with you again on our next earnings call, and have a great day, everyone.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.