UPXI

Good day, and welcome to the Upexi, Inc. fiscal third quarter 2026 financial results conference call. Please note this event is being recorded. I would now like to turn the conference over to Valter Pinto, Managing Director at KCSA Strategic Communications. Please go ahead.

Thank you, operator. Good evening, and welcome everyone to the Upexi fiscal third quarter 2026 financial results conference call. I'm joined today by Allan Marshall, Chief Executive Officer, Andrew Norstrud, Chief Financial Officer, and Brian Rudick, Chief Strategy Officer. Before we begin, I'm going to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the safe harbor of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially due to a variety of risks, uncertainties, and other factors. For a detailed discussion of some of the ongoing risks and uncertainties in the company's business, I'll refer you to the press release issued this evening and filed with the SEC on Form 8-K, as well as the company's reports filed periodically with the SEC.

The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law. In addition, during the course of the call, we may refer to non-GAAP financial measures that are not prepared in accordance with the accounting principle generally accepted in the U.S., and they may be different from non-GAAP financial measures used by other companies. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in our earnings release issued this evening, unless otherwise noted. I'd now like to turn the call over to Upexi CEO, Allan Marshall.

Thank you, Valter, and welcome everyone to our fiscal third quarter 2026 earnings conference call. I'm happy to review our quarterly results and discuss why we're particularly optimistic about the future. Our fiscal third quarter was characterized by a challenging environment, most notably a continued decline in both the price of Solana and industry multiples. Both had a direct impact on our stock and were the result of a general bear market in crypto. That said, SOL has rebounded from its intra-quarter low of approximately $77 to current $96, and our multiple is also well off the lows and are now sitting above NAV and our fully-loaded measure. Brian will cover our thoughts on the downturn and why we believe prices and valuations can and will improve in the future.

While we, like any treasury company, are heavily impacted by token prices and valuation multiples, we are not simply waiting around for the environment to improve, but rather are taking a proactive approach with several efforts afoot. One key initiative, which will always be a core component to the company, is intelligent capital issuance. Like peers, we generally traded at a discount to NAV during the quarter. We took advantage by buying back approximately 2.5 million common shares for roughly $2 million or $0.80 per share. As a reminder, buying shares below 1x NAV increases our Solana per share.

In addition to the buybacks, we remained active on the issuance front, issuing a $36 million in-kind convertible note in January, which materially reduced credit risk given the in-kind nature and will also increase our Solana per share should the notes convert, given a conversion price above NAV at the time of the issuance. We completed an approximately $7 million equity plus warrants offering, which was done above NAV and also increased our Solana per share. Despite the difficult environment, we demonstrated an ability to utilize the capital markets to create value with both buybacks and issuances. Second key initiative during the quarter was an intense focus on expenses, including both treasury-related and for our brands business. On the treasury side, expenses have been elevated since the launch of our treasury due to initializing the strategy, but will now normalize going forward.

On our brand business, we moved from in-house operations, including manufacturing, warehouse, and logistics, to outsourced operation with third-party providers. Importantly, our costs are now right-sized and are more closely tied to the revenue generated. All in, and assuming a continued 6%-7% staking yield, we expect that by July 1st, the ongoing cash expenses for operations and interest will be less than the treasury staking revenue. Our goal is to have the lowest expense base of Solana treasury company peers. The last key initiative during the quarter was yield generation, where we aimed to increase the native 7% Solana staking yield in a low risk and recurring manner. We continue to examine traditional sources of yield and are working towards a strategy that, if successful, would materially increase the total yield earned on the treasury.

We believe the market would pay for the additional yield earned beyond the native staking yield if the yield is low risk and recurring. If we are correct and successful, this would be accretive to our multiple, potentially giving us a sustained premium valuation that we can monetize and perhaps even perpetually enabling the digital asset treasury company capital markets flywheel. With that, I'd like to turn the call over to our Chief Strategy Officer, Brian Rudick.

Thanks, Allan. Hello, everyone. Solana fell from roughly $125 per token to about $83 per token during the quarter for a 33% decline. This compares to Bitcoin's 22% fall over the same period. We believe the main reason for the decline in the price of Solana during the quarter was the decline in the price of Bitcoin. Whether due to investors lumping all of crypto together, combined with Solana's much smaller market cap or to programmatic funds trading digital assets together, Solana tends to trade with the beta to Bitcoin. Bitcoin fell materially due to a myriad of reasons, including OG token holder selling, four-year cycle fears, fallout from the October 10th deleveraging event. Precious metals stealing the show, digital assets competing with alternative investment opportunities like AI and more, which pulled Solana lower.

While we believe the biggest determinant of the price of Solana will be the price of Bitcoin over the near-term, we see this changing over the next few years. This is primarily because Bitcoin and Solana are two completely different constructs, with the former a store of value or digital gold, and the latter a new type of computer, and one that is upgrading our antiquated financial infrastructure. We believe that Solana will increasingly be viewed independently from Bitcoin as investor knowledge increases and judged based on its own underlying fundamentals. Here, Solana fundamentals remain strong. As a reminder, Solana's North Star is what it calls Internet Capital Markets, where it aims to have all the world's assets trading on a single liquidity venue accessible 24/7, 365 days by anyone with an internet connection.

While Solana is simply a computer capable of running any application, we see particular opportunity in upgrading our antiquated financial infrastructure, much of which is old, slow, and expensive, with internet and blockchain-based rails for massive speed, cost, transparency, composability, and capital access benefits. Specific areas in this financial infrastructure upgrade include stablecoins, which enable near-free and near-instant payments to anyone, anywhere in the world. Stablecoin transfer volume on Solana totaled $2.1 trillion in the quarter, up 60% over the prior year, and leading traditional companies like PayPal, Western Union, and Société Générale are continuing to build and issue stablecoins on Solana due to its top performance and distribution. Another is tokenization, also known as Real-World Assets or RWAs, which move off-chain assets on-chain for massive benefits around asset management and administration, market efficiency and liquidity, and financial inclusion and economic growth.

Solana RWAs hit $2.4 billion in 1Q, up from just $317 million a quarter a year ago, including assets from leading issuers such as BlackRock and Franklin Templeton, and including tokenized equities where Solana commanded a 99% market share of trading volume in the first quarter. Agentic payments, which are financial transactions executed autonomously by AI agents, are another large opportunity, as many experts believe that one day the bulk of economic activity will be performed by agents. AI agents cannot simply open up a traditional bank account, rather need a hyper-performant, credibly neutral, and permissionless network on which to transact. This puts Solana in the catbird seat to capitalize on this nascent but emerging trend, tying AI progress with Solana's future success. I will conclude by saying that recent price action, in my opinion, creates a compelling opportunity.

Bitcoin pulled the price of Solana lower, while the fundamentals from stablecoins to tokenization, AI agents, and beyond are higher. Over time, prices follow fundamentals, and a lower price against improving fundamentals creates an improved risk-reward. Upexi and Solana are well-positioned to benefit. With that, I'll turn the call over to our Chief Financial Officer, Andrew Norstrud, for a review of our financial performance.

Thank you, Brian. As of March 31st, the company had approximately $3.5 million in cash, 2.5 million Solana tokens, 1.4 million liquid, and the remaining 1 million tokens locked. During the quarter ended March 31st, 2026, staking generated approximately 35,000 tokens or $3.5 million in revenue. We reduced the overall short-term debt by approximately $7.6 million, which included reducing short-term treasury debt by $5.4 million. We reduced the recurring general administrative expenses compared to the second quarter ended December 31st, 2025, and reduced the overall employee count to 10 employees. During the remainder of the year, management expects to eliminate and/or reduce additional ongoing general and administrative expenses and transition all consumer brands fulfillment to third-party providers.

Based on the execution of these plans, the ongoing cash expenses will be less than the ongoing estimated staking revenue. For the nine months ended March 31st, 2026, the company had digital asset revenue of approximately $14.7 million or approximately 100,000 tokens. Our tokens earned from staking has increased quarterly, and we expect the trend to continue. The direct treasury expenses for the nine months ended March 31st, 2026, were approximately $8.6 million, which includes management fees, custodian fees, service fees, and interest.

For the nine months ended March 31st, 2026, the treasury had an unrealized loss on digital assets of approximately $178.8 million, reflective of the Solana price per liquid token of $83.11, and $71.47 per locked token as of March 31st, 2026. There were no comparable financial results for the prior period. The company continues to develop the digital asset treasury with a focus on maximizing the return for shareholders and had substantially all tokens staked at March 31st, 2026.

For the fiscal third quarter, total revenue was $4.6 million, compared to $3.2 million in the prior year quarter. For the nine months period ended March 31st, 2026, total revenue was approximately $21.8 million compared to $11.5 million in the prior year period. This increase reflects the addition of our digital asset treasury business in 2025. Net loss for the quarter was approximately $109 million or $1.67 per share. $92.3 million related to the unrealized loss on digital assets during the quarter. During the quarter, we increased the total number of Solana tokens held by approximately 189,000, equating to 9% increase or 35% annualized.

Our focus is growing Solana holdings on a per share basis through disciplined capital activities, staking yield, and opportunistic purchases while maintaining prudent leverage and risk management. Operationally, we will continue to align our expenses with that strategy. Now I turn the call back over to Allan for concluding remarks.

Thanks, Andrew. Upexi is operating from a position of strength. We have what we believe is the lowest average Solana purchase price of our larger peers. We have perhaps the cleanest capital structure, and we have leading trading volumes and a leading valuation. These characteristics put us in an advantaged position to execute on value-creating actions from accretive equity and in-kind convertible notes issuances to accretive M&A and beyond. Lastly, I want to remind everyone of the four items that differentiate Upexi from peers. First, we have a differentiated management team, one who have been extremely successful in the past with a very deep capital markets expertise. Second, we have a strategy to maximize shareholder value in a risk-prudent manner, which we believe positions us well for any market environment and appeals to investors of all kinds.

Third, we have and will continue to lead innovation and have done several firsts in the industry on the capital market side. Lastly, we have demonstrated an ability to create value for shareholders, executing our value creation mechanisms to increase adjusted Solana per share by 35% last year and a full 32 percentage points more than investors would have gotten by simply staking Solana natively themselves. With that, I'll turn it over to the operator for questions.

Thank you. Ladies and gentlemen, to ask a question, please press star then one. That is star one to ask a question. We'll go first to Brian Kinstlinger with Alliance Global Partners.

Great. Thanks so much. In the press release, you highlighted a 9% sequential increase in the Solana count. Can you highlight the underlying yield for Solana that you're generating, outside of what was acquired through the capital raise? What are the ways you're evaluating to improve that yield?

Andrew, you wanna take that part?

Yeah. During the quarter, the staking yield or the staking revenue was a little bit less than 35,000 tokens that we got. We had the $265,000 convertible debt that we did, and we also sold off 100,000 tokens during the quarter. We had a net of 187,000 increase of tokens.

Got it. Great. Thank you.

And then-

And then, uh-

Go on.

Yeah, go on.

No, I was just gonna say, and for the staking yield, overall the total rewards has been down a little bit, but it's just below 7% for the native staking that we're doing.

Great. Then you mentioned in your prepared remarks, accretive M&A. Can you highlight how management's thinking about M&A and what types of assets might be intriguing or go hand in hand with your business?

Thanks, Brian. Right now, we're just exploring options on ways where we could increase the overall return on our capital. You know, the way we look at it is for the staked tokens, it's 7%, and for the locked tokens, it's closer to, you know, double that or just less than double that. Anything we do would have to keep in mind that, you know, the barrier for us to do something would have to be beyond those yields. We've looked at multiple things, but obviously with just the overall market conditions right now, we're kind of waiting to see what options come become available. This is just an expansion of the way we were thinking before.

Before we were thinking strictly, you know, buy as much Solana as we possibly can and stake it. We are still thinking that, but we're also open to looking at opportunities that could increase that yield. Anything we did do, though, would not mean we sold any of our Solana. We would either use some sort of leverage or debt. To do that, it would have to surpass the income we would get from the Solana tokens.

Great. I've got one follow-up. You know, when I look at the balance sheet and the Q says on the first page, you get 70 million plus shares. You've got $238 million of debt. You know, I've got your enterprise value at $455 million, and your NAV is $227 million. Why is that not what the right way to think about it, that you've got an EV to NAV of 1.5x? You guys are talking about having it below 1x.

Brian, do you wanna Brian or Andy? I'm not sure appropriate.

Yeah.

I'm not sure on that statement.

I-

Yeah, but-

Go ahead, Brian.

Appreciate the question. We put out our investor deck and in the appendix we have two ways that we calculate it. It really depends on whether or not our in-kind convertible notes end up converting. If you run that embedded option through any sort of options pricing calculator, it suggests that they are still more likely than not to convert. If those do convert, then all that SOL is ours, and we will have to issue additional shares backing that. On our fully-loaded NAV, which is how we like to look at it, we assume that those converts convert and we assume that we sell SOL to pay back our line outstanding, and that's what gets you to a roughly 1x NAV.

The other one, which I think you're referencing, is assuming there's no conversion, we have to give back some of that SOL, but we also don't have to issue those additional shares, and that's where we're way above NAV. My personal view is that there's probably a blend of the two, based on the probability of those in-kind converts converting. Again, we do think that those will convert, which is why we tend to manage the company based on our fully-loaded NAV.

Okay. Thanks so much, guys.

We'll take our next question from Gareth Gacetta with Cantor Fitzgerald.

Hi, guys. Thank you. I was wondering if you could dive in on the cost structure and kind of the path to a self-sustaining treasury. Could you maybe talk about what existing cost actions need to be hit before you get to July 1st milestone? Maybe once you get there, from that base, is the yield strategy, will that kind of provide some operating leverage on top of kind of where you think it will sit today?

Sure. I can open it up, and then Andy can get into any details.

Yes.

The way we're looking at it is we've reduced the headcount, we've outsourced all of the brand businesses, so they all run, you know, at a cost basis where we, so we can manage it much more easily and competitively. I think the couple things we have to do, one is we need to refi a little bit of the debt we have or get some sort of like small appreciation in Solana's price. That would re-reduce expenses enough, like on the debt profile to bring us really close to cash flow neutral. Any increase, the way we're thinking about it, is any increase in the price of Solana, obviously that yield becomes very material for us.

If you want Andy can break down any more detailed information you want or Brian can.

Just real quick, I mean, we have some expenses like warehouse leases and everything else that'll come, will be expiring. We'll no longer be using them in this quarter. That's kind of what the July 1st date states, so that these leases are gone, all the employees are gone, everything's finished with any of the logistics that we were doing before. Now it'll become everything will be measured on profitability through the inputs.

The second area of it is, as Allan started to allude to, is that, you know, right now with that short-term treasury debt, we do have, you know, $500,000+ per month of interest that we're gonna be looking at a couple different ways to reduce that significantly in the next three months, which will reduce the overall operating expenses in that treasury significantly. That right now, even without that's where we can just about break even ± a little bit based on the price of SOL. As we start taking care of those in the next two months, that'll get us well over that. Yes, there will be excess cash from those revenue stakings as we're projecting right now, if everything goes as planned.

Gotcha. That's really helpful. Maybe, I know it's further down the line, but if you do end up generating some cash flows from this staking business, can you talk about maybe how you think about allocating that and returning it to shareholders? Would you maybe buy more SOL or lock SOL or think about repurchases?

We would look at all of them. Like during the quarter we, you know, or, you know, we repurchase shares 'cause they're at 0.8 or even less of NAV. We had the excess cash. Yeah. I mean, any excess cash we have come in will go into building the treasury 'cause, I mean, that's SOL per share, whether it be repurchasing shares or buying more SOL.

Okay, awesome. Then maybe last one. Could you just kinda double-click on the high yield strategy and like what portion of the treasury is initially allocated to it and your appetite to maybe allocate more or a greater percentage of it towards that in the future?

Yeah. We've been looking at certain strategies. Obviously, the yields on some of these strategies have been moving all over the place over the last, you know, 90 days. I think we would do an initial, small initial amount into that, like $25 million or $50 million, and then work on that yield if we could get it high enough. Once we do refinance the debt, we'll have more availability to put more into a strategy like that should the yield, you know, generate the way we think it's going to. We're doing all of this off chain. We're trying not to do anything on chain. We're using more traditional, you know, Wall Street instruments.

Totally. That's really helpful. Thank you, guys.

This does conclude our question and answer session. I would now like to turn the conference back over to Allan Marshall for closing remarks.

Just wanna thank everybody for joining the call today. We really appreciate the support. Thanks for the great questions, and we'll look forward to updating everyone on the year-end. Have a great evening.

And the conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Good day. Welcome to Upexi, Inc. Fiscal Second Quarter 2026 Financial Results Conference Call. Please note this event is being recorded. I would now like to turn the conference over to Valter Pinto, Managing Director at KCSA's Communications. Please go ahead.

Thank you, operator. Good evening, and welcome, everyone, to the Upexi, Inc. Fiscal Second Quarter 2026 Financial Results Conference Call. I'm joined today by Allan Marshall, Chief Executive Officer, Andrew Norstrud, Chief Financial Officer, and Brian Rudick, Chief Strategy Officer. Before we begin, I'm going to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the safe harbor of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially due to a variety of risks, uncertainties, and other factors. For a detailed discussion of some of the ongoing risks and uncertainties in the company's business, I'll refer you to the press release issued this evening and filed with the SEC on Form 8-K, as well as the company's reports filed periodically with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law. In addition, during the course of the call, we may refer to non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States, and they may be different from non-GAAP financial measures used by other companies. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures is contained in our earnings release issued this evening, unless otherwise noted. I'd now like to turn the call over to Upexi's CEO, Allan Marshall.

Thank you, Valter, and welcome to our second quarter 2026 earnings conference call. I'm happy to review our results and discuss why, despite the difficult market backdrop, I remain extremely optimistic for the future and why we remain well-positioned to win. The market presented two key challenges for us last quarter with both declining asset prices and treasury company multiple compression. This was reflected in our quarterly results as well as in our stock price. I'll discuss each in succession. On the former, the price of Solana fell 40% during the quarter, and it has fallen a further 31% since the quarter end. While there have been many reasons cited, including rising geopolitical risks, precious metals stealing the show, and many more, the fact of the matter is the biggest determinant of any treasury company's success has and always will be the performance of its underlying token. Thus, we are not immune, and Solana's performance had a big impact on the company. That said, I remain encouraged for three key reasons. The first is given their latency, such volatility is normal with digital assets. And Solana often exhibits large movements in both directions along a significant uptrend over time. Second, as Brian will discuss in more detail, the underlying fundamentals for Solana continue to improve as global finance moves on-chain. Here, I'm particularly optimistic because over time, price follows fundamentals. And improving fundamentals against the falling price is a recipe for greater potential upside. Lastly, as a treasury company, we have multiple mechanisms not available to native tokens or ETFs that can create value for shareholders, like accretive issuance and discounted lock token purchases. We have in the past and aim to, in the future, increase our Solana per share to help offset any decline in token price, or to add to any increase in price in an upmarket. So overall, between the volatility being expected, a positive view for potential Solana price appreciation, and our ability to increase Solana per share, we remain positive about the opportunity and continue to believe 2026 will be a strong year for Solana and Upexi. The second key challenge during the quarter was general multiple compression in the treasury space. We believe this was due to the law of supply and demand. With over 200 treasury companies, it's not hard to see why many are trading at discounts to net asset value. Despite this, I remain optimistic for so many reasons. First, I believe the subsector will work through some of its oversupply, either through M&A or from treasury companies selling their digital assets to close the discounts. Secondly, I believe there are fundamental reasons why Upexi can and should trade at a premium valuation in constructive market environments. As discussed in the past, these have to do with our multiple value accrual mechanisms which have value. Third, as we have publicly stated, we are working to increase the yield that we generate on a treasury in a risk-prudent and recurring fashion. Should we be successful, we believe this would increase our multiple, which in turn would accelerate the model and differentiate Upexi from others. Lastly, I believe we're likely to see multiple expansion in a bull market, as has been the case historically with public companies. And there are large catalysts like the potential passage of US digital asset legislation that could quickly bring this to fruition. In closing, while we have had a turbulent start to 2026, we remain positive about the future and the company has developed a strong strategic plan to, one, increase yield, two, hedge positions using maturing option markets, and lastly, capitalize on top of opportunities the volatility creates. All of these things should lead to significant growth in yield, cash flow, and stability for 2026 and beyond. With that, I'd like to turn the call over to our Chief Strategy Officer, Brian Rudick.

Thanks, Allan, and hello, everyone. Despite the challenges during the quarter, the underlying fundamentals for both Solana and Upexi remained solid. As a brief reminder, Solana's North Star is what it calls Internet capital market, where it aims to upgrade our antiquated global financial infrastructure. Existing constructs like ACH and the credit card issuer networks were created fifty-plus years ago and are slow and expensive. While even fintech is simply a front-end wrapper on this antiquated infrastructure. But we can now use Internet and blockchain-based rails to upgrade this antiquated infrastructure for huge speed and cost savings, in addition to other benefits around transparency, composability, investor access, and many more. Solana continued to progress throughout the quarter with increased development, adoption, and usage. The Spot Solana ETFs launched and have seen over $850 million of net inflows since. Stablecoin supply reached a new record, tokenized equities are booming. Non-native tokens like MON, STRK began trading on Solana, and the FireDancer client launched on Mainnet. And importantly, key announcements were made by various leading institutions, including Western Union, Visa, Coinbase, Revolut, Robinhood, Cauchy, and SoFi. In short, Solana demonstrated strong momentum and particularly so related to its Internet capital markets goal. The opportunity to revolutionize finance is massive, and Solana is at its very heart. We remained active with the capital markets highlighted by the private placement of $19 million in common stock and warrants, and subsequent to quarter end, an additional $7 million common stock and warrants offering as well as a $36 million in-kind convertible note issuance. Both were done at a premium to our fully loaded NAV meaning they increased adjusted Solana per share. We also became self-eligible during the quarter and quickly filed our shelf statement on Form S-3 with the SEC which is now effective. And we announced a $50 million share repurchase program adding another important tool to manage capital. On the visibility front, we participated in over 10 conferences and events during the quarter, including Solana Breakpoint, Maxim, Cantor, Rothschild, Roth, Clear Street, and others. These resulted in myriad presentations and panels, as well as in over 100 investor meetings where we continue to evangelize both Solana and Upexi. And we continue to appear in many news articles and podcasts throughout the quarter. Put simply, Solana is executing on its Internet capital markets road map and Upexi is adding additional value for shareholders. And with that, I'd like to turn the call over to our Chief Financial Officer, Andrew Norstrud, for a review of our financial performance.

Thank you, Brian. As of December 31, the company had approximately $1.6 million in cash and 2,170,000 Solana tokens. 1,320,000 of those tokens were liquid, 850,000 of those tokens were locked. For the six months ended 12/31/2025, the company had digital asset revenue of approximately $11.2 million or approximately 65,700 tokens added. We expect to increase the number of tokens we hold in our treasury each quarter and also increase the quarterly revenue from the treasury. The direct treasury expenses for the six months ended 12/31/2025 were approximately $6 million which included management fees, custodial fees, service fees, and interest. For the six months ended 12/31/2025, the treasury had an unrealized loss on digital assets of approximately $86.4 million reflective of the Solana price per token of $124.48 at 12/31/2025. There are no comparable financial information for the prior period as the Digital Treasury was started in April 2025. The company continues to develop the digital asset treasury with a focus on maximizing the return for shareholders and had approximately 95% of all token stake at 12/31/2025. For the second quarter, total revenue was approximately $8.1 million, an increase of approximately $4 million or just over 100%, compared to $4 million in the prior year quarter. For the six months period ended 12/31/2025, total revenue was $17.3 million compared to $8 million in the prior period. This increase reflects the addition of digital asset treasury business in 2025. The net loss for the quarter was approximately $178.9 million or approximately $2.94 per share. This loss was primarily driven by the $164.5 million of unrealized losses on digital assets reflecting non-cash quarter-end fair value adjustments as well as approximately $8.3 million of stock compensation expense. Excluding these fair value changes, the underlying treasury's performance remains strong. We increased the number of Solana tokens in our treasury during the quarter by approximately 106,000 tokens. The increase was driven by spot token purchases partially offset by a decline in the locked Solana through a swap transaction. We continue to strengthen our balance sheet in light of the changing market environment. Due primarily to accretive equity raises previously mentioned, we currently have approximately $9.7 million of cash on hand. Management continues to focus on growing Solana's holdings on a per-share basis through disciplined capital activities, staking yield, and opportunistic purchases of discounted locked tokens, while maintaining prudent leverage and risk management. And now I'll turn it back over to Allan for concluding remarks.

Thanks, Andrew. I wanted to conclude the call by highlighting our top priorities. While we, as always, remain hyper-focused on external visibility and intelligent capital issuance, there are two key initiatives worth highlighting. The first is a continued focus on accretive growth. We aim to raise capital above NAV to increase our digital assets per share. We will continue to look for ways to raise equity capital in the most cost-effective manner available. Additionally, we will also continue to issue in-kind convertible notes at a premium to NAV. Such notes offer differentiated risk-reward for investors while significantly reducing credit risk for both parties. Our second key focus going forward is to increase the yield on the treasury in a low-risk fashion, which we believe would enhance our valuation. If we are successful, we should trade at a sustainable premium, which itself would accelerate the capital markets flywheel. In closing, we've remained active even in a significant downtrend, completing both a capital raise and an in-kind convert both at slowly or above NAV. While this has not helped stem the downturn in this or the stock performance, we believe it will accelerate the upturn when Solana and crypto begin to recover from the current drawdown. With that, I'll turn it over to the operator for questions.

Thank you. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question is from Brian Kinstlinger with Alliance Global Partners. Please proceed.

Great. Thanks for taking my questions. Recent pressure on Solana coupled with your high conviction, is there any change in terms of your capital raising strategy? Are you more willing to raise capital at a lower premium to MNAV? To reduce your average purchase price? And then is the goal to use the ATM as much as possible to lower your cost of capital.

I'll jump in here, Brian. I don't think we've changed our perspective at all on this. We have one of the lowest costs on Solana tokens. We were able to, like we said, do two capital raises subsequent to the quarter end, with the one with Hivemind and then the cash one not too long ago, just over NAV. So we don't want to panic here and let or I shouldn't say panic, but, you know, decisions based on just daily movement. We continue to bring that cost down. We'll definitely be open to raising capital as that gap to NAV closes again, but we're still going to look to raise above NAV or at NAV as often as possible. The ATM, obviously, is the lowest cost. Now that we have all the tools in place going forward, we'll certainly be willing to use that, but we'll also be willing to sell Solana to buy stock back if that gap gets too wide as well. Well, to that point, you've got $9.7 million of cash. How do you weigh buying Solana versus keeping a reserve? I think the one thing that this downturn has taught everybody is to keep a reserve. Right? Like, the volatility has been even I think would from the crypto neos, we would consider pretty volatile in such a short period of time, especially into what everyone considers tailwinds. So right now, we're going to just be prudent. We do think we're getting close to washing out at the bottom here. Hopefully, it'll bounce around for a while and recover. So cash reserves are okay. What we've done is, you know, just kind of throw the balance sheet, make sure that we're set. The other thing with the whole market, and I said it in our call, is the options market and everything are getting much more liquid. So you're going to have a lot more opportunity to hedge these positions or to partially hedge these positions. We tried to do it earlier in the year. We're just unable to get a liquid enough market to do the size we wanted. Now looking back, we wish we could have, but with all of the new kind of attention to it, all of the ETFs launching with, you know, liquidity is coming. So everything's maturing, and I think all of that's going to still bring a lot of opportunity both to raise capital again, to hedge in any movements, to sit on cash. You know, right now, we're just in general, like, playing it as close to the vest we can, but we're still looking to grow.

Right. My last question is you've alluded to your high yield strategy plans. I think you had a press release a while back on that too. Any more you can share we've seen a number of DApps lend their digital coins they've generated a much higher return. I guess I'm curious is there a lower appetite or would be partners for this type of transaction given the pressure in cryptocurrency? Or are there still a number of parties that have a high degree of interest in something's imminent.

Couple things. One is, like, I want to see what how that yield like, we understand how they're looping those tokens and everything. I don't believe that creates the yield that they're talking about, so I want to see how that's I'm not sure it's presented in apples to apples, presentation. So we want to see that. However, we are currently going through the exercise to pinpoint, like, the risk-adjusted, high yield strategies we're looking for opportunities. What we do believe there's a time and a place for on-chain yields, today is not it for us. We're not willing to go on-chain. We're still waiting for that regulatory clarity. The on-chain comes with additional smart contract liquidation risks. We don't want to enter into any of that. Like you said, with that volatility, and those yields, you know, can also compress. So what we're looking at is a more familiar and really easily understood by traditional kind of investors. We're looking at something that's more familiar in the markets. We're going to try to launch that here into the second quarter. April 4. And at that point, we'll probably give you more clarity on how we're doing that. But it's not on-chain. That's all I can tell you for now.

Okay. Thank you for taking my questions.

As a reminder, it is star one on your telephone keypad if you would like to ask a question. Our next question is from Brett Knobloch with Cantor Fitzgerald. Please proceed.

Hi, Thanks for taking my question. I might have missed this, but is there an updated Solana balance following the direct offering in the placement of the convertible notes? In the press release, it said around 2,400,000. Is that the number that we should be using?

That's the public number we have so far as it's really close. It's really close to that number. Nothing much has changed.

Perfect. Appreciate it. And then just to maybe double click on the generating additional yield outside of staking. Can you maybe elaborate in what forms of activities you would participate in? Obviously, you said nothing on-chain, but any additional color on how or where you would generate additional yield to staking?

You know, what I'll let Brian step in here. But, yeah, what I will say is we're, you know, we will definitely collaborate on that going forward. But right now, we're trying to get it set up the way we want to get it set up. But I'll let Brian step in and elaborate a little bit there.

Yeah. Thanks, Allan, and thanks, Brett. Yeah. As Allan mentioned, we're still in the exploratory phase. We think that we've identified specifically one strategy that can generate high yield in a low-risk way. But we're waiting till we're a bit further along in that path before we reveal too many details. The one thing I'd say is, like, we've got really two key things that we're focused on. One is making sure that this is recurring. And number two, making sure that this is low risk. And so when we think about it internally, our hurdle rate is that low to mid-teens that we can get on the lock. And so we've bought locked Solana at a 15% discount. When you think of it like OID and you put that 15% discount into the yield equivalent, we still get the 7% staking yield on that, and so it translates to an all-in, you know, low teens yield. And so that and we view that as low risk as well. So that is kind of the hurdle rate of what we're looking to do. And everything that we do will be compared against that. But we will give more information in the future as we continue to progress there.

Perfect. Thanks, guys. Appreciate it.

There are no more further questions. I would like to turn the conference back over to Allan Marshall for closing remarks.

Well, thank everybody for joining the call. I know it's been a tough quarter for everyone in crypto. We, like I said, during the call, we do think the future is still bright. We think we're on the right path. And thank you for the great questions. And we look forward to updating you guys during the quarter, and look forward to the next conference call. Thank you very much.

The conference has now concluded. Thank you for attending today's call. You may now disconnect.