Financial Analysis

NOTE 14 COMMITMENTS AND CONTINGENCIES In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements. On November 24, 2021, the Company entered into an Asset Purchase Agreement (the Agreement) dated as of November 15, 2021, with FFS Data Corporation (FFS) whereby the Company acquired a portfolio of merchants utilizing financial transaction processing services (the Acquired Merchant Portfolio). The purchase price was $20 million, with $16 million paid at closing, $2 million payable within six months after closing, and a $2 million payment to be transferred to an escrow account, contingent upon an Attrition Adjustment, as described in the Agreement. However, the Company is engaged in ongoing litigation with FFS in the Supreme Court of the State of New York, New York County relating to the Acquired Merchant Portfolio wherein: (i) FFS alleges the Company breached the contract by failing to pay the balance of the purchase price; and (ii) the Company seeks to recover the purchase price along with damages arising from FFS breach of representations and warranties and other misrepresentations about the Acquired Merchant Portfolio which ultimately resulted in the termination of the bank processing agreement by Clear Fork Bank (the Bank). In addition, the Company has f …

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NOTE 7 NOTE PAYABLE On November 29, 2021, the Company entered into a Master Equipment Finance Agreement (the MFA) with VFS LLC (VFS) which would allow the Company to finance the purchase of certain equipment. The collateral and interest rate are determined at the time the Company borrows the funds. During the year ended December 31, 2022, the Company received, as an initial draw on the MFA, $875,000 from VFS (the Equipment Loan). The Equipment Loan is secured by bitcoin mining computers being utilized by DMINT. The Equipment Loan requires monthly payments of $24,838 until the loan is repaid in full or it matures on March 1, 2025. During the year ended December 31, 2025, the Company made repayments of $38,838. As of December 31, 2025 and 2024, the note payable balance was $216,684 and $202,939, respectively. This liability was settled on January 7, 2026 for $216,684, to be paid in monthly installments of $8,000. …

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The following table presents the Companys revenue disaggregated by revenue source: For the Years Ended December 31, 2025 2024 Transaction and processing fees $ 7,936,768 $ 9,684,152 Merchant equipment rental and sales 28,720 75,575 Revenue, net - bitcoin mining 210,256 413,332 Other revenue from monthly recurring subscriptions 302,241 521,268 Digital product revenue 198,922 2,144,661 Total revenue $ 8,676,907 $ 12,838,988 …

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NOTE 8 STOCK OPTIONS On January 3, 2024, the Company granted stock options to purchase 20,000 shares of common stock pursuant to the terms of the Companys employment agreement with Mr. Yakov. 50% of the options vested immediately, 25% of the options vest on the one-year anniversary of the grant, and 25% of the options vest on the two-year anniversary of the grant. The options have an exercise price of $0.10 per share. The aggregate fair value of the options totaled $541,999 based on the Black Scholes Merton pricing model using the following estimates: exercise price of $0.01 (pre-split pricing), 1.63% risk free rate, 295% volatility and expected life of the options of 10 years. The fair value of the options will be recognized over the vesting period with credits to additional paid in capital. On January 24, 2024, Mr. Yakov exercised options to purchase a total of 118,792 shares of common stock for $4,079 (see Note 11 and Note 13). On January 24, 2024, Mr. Smith exercised options to purchase a total of 38,107 shares of common stock for $2,761 (see Note 11 and Note 13). A summary of the status of the Companys outstanding stock options and changes is presented below: Stock Options Options Weighted Average Exercise Price Aggregate Intrinsic Value Options outstanding December 31, 2023 156,899 $ 0.04 $ 1,656,270 Granted 20,000 $ 0.10 Exercised (156,899 ) $ 0.04 Expired $ Options outstanding December 31, 2024 20,000 $ 0.10 $ 39,400 Granted Exercised Expired Options outstanding Decem …

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NOTE 15 INCOME TAX Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Net deferred tax assets consist of the following components as of December 31: 2025 2024 Deferred Tax Assets: NOL Carryover $ 11,836,900 $ 9,602,900 Allowance for Doubtful Accounts 56,100 56,100 Depreciation and amortization 3,349,400 4,135,700 ) Less valuation allowance (15,242,400 ) (13,794,700 ) Net deferred tax assets $ $ The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pre-tax income from continuing operations for the period ended December 31, due to the following: For The Years Ended December 31, 2025 2024 Expected federal tax (expense) benefit $ 1,234,000 21.0 % $ 2,357,000 21.0 % Expected state tax (expense) benefit 352,000 6.0 % 674,000 6.0 % Stock based compensation (36,600 ) (0.9 )% (109,800 ) (1.0 )% NOLs expired (103,600 ) (1.8 )% - - % Nondeductible expenses and other 900 - % (900 ) - % Increase in valuation allo …

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NOTE 10 OPERATING LEASE On November 13, 2024, eVance entered into a Lease Agreement (the Lease) with Royal Centre Holdings LLC (the Lessor) relating to approximately 1,740 square feet of property located at 11475 Great Oaks Way, Alpharetta, Georgia. The term of the Lease was for thirty-nine (39) months commencing December 1, 2024. The monthly base rent was $4,023.75 for the first twelve (12) months, beginning in April 2025, increasing each year thereafter. The total rent for the entire lease term was $162,435. The lease was cancelled without penalty on December 31, 2025. Lease expense for the years ended December 31, 2025 and 2024, was $83,115 and $147,575, respectively. The Company has multiple short term rental arrangements that are not captured under ASC 842. Those payments are expensed as incurred and included in the total lease expense for each year. …

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Recent Accounting Pronouncements In November 2024 , the FASB issued Accounting Standards Update 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) which requires that at each interim and annual reporting period an entity: 1 . Disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization included in each relevant expense caption. A relevant expense caption is an expense caption presented on the face of the income statement within continuing operations that contains any of the listed expense categories. 2 . Include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements. 3 . Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. 4 . Disclose the total amount of selling expenses and, in annual reporting periods, an entitys definition of selling expenses. These amendments are effective for annual reporting periods beginning after December 15, 2026 , and interim reporting periods beginning after December 15, 2027 : either ( 1 ) prospectively to financial statements issued for reporting periods after the effective date of this Update or ( 2 ) retrospectively to any or all prior periods prese …

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NOTE 13 RELATED PARTY TRANSACTIONS On January 16, 2024, the Company issued 39,211 shares of common stock to Mr. Smith. The shares were issued for bonus compensation of $300,000 that was accrued as of December 31, 2023 (see Note 13). On January 16, 2024, the Company issued 78,421 shares of common stock to Mr. Yakov. The shares were issued for bonus compensation of $600,000 that was accrued as of December 31, 2023 (see Note 13). On January 24, 2024, Mr. Yakov exercised options to purchase a total of 118,792 shares of common stock for $4,079. On January 24, 2024, Mr. Smith exercised options to purchase a total of 38,107 shares of common stock for $2,761. During the years ended December 31, 2025 and 2024, the Company accrued $30,630 and $124,903, respectively, for dividends on the Series A preferred stock held by Mr. Yakov. On June 2, 2025, Mr. Yakov converted $529,000 of the accrual into 529,000 shares of common stock and forgave the remaining $45,139, which was credited to additional paid in capital. As of December 31, 2025 and 2024, total accrued dividends on the Series A preferred stock due to Mr. Yakov is $0 and $543,509, respectively. On April 8, 2024, the Company entered into Amendment No. 1 (the Amendment) to the Employment Agreement with Mr. Yakov (the Yakov Agreement). The Amendment corrected a ministerial error in the terms relating to the exercise price of stock options awarded and automobile allowance for Mr. Yakov. The Amendment affirmed that the exercise price of s …

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NOTE 16 SEGMENTS The Company applies ASC 280, Segment Reporting , in determining its reportable segments. The Company has two reportable segments: Bitcoin Mining and Fintech Services. The guidance requires that segment disclosures present the measure(s) used by the Chief Operating Decision Maker (CODM) to decide how to allocate resources and for purposes of assessing such segments performance. The Companys CODM is comprised of several members of its executive management team who use revenue and expenses of our two operating segments to assess the performance of the business of our reportable operating segments. The following tables detail revenue, operating expenses, and assets for the Companys reportable segments for the year ended December 31, 2025. Fintech Segment Bitcoin Mining Segment Consolidated Total ASSETS Current Assets: Cash $ 15,751 $ 26 $ 15,777 Accounts receivable, net 17,430 17,430 Prepaid expenses 162,766 162,766 Other receivables 430,232 398,983 829,215 Other current assets 25,444 25,444 Total Current Assets 626,179 424,453 1,050,632 Other Assets: Property and equipment, net 2,725,120 2,725,120 Goodwill 8,139,889 8,139,889 Other long-term assets 380,952 380,952 Total Other Assets 8,520,841 2,725,120 11,245,961 TOTAL ASSETS $ 9,147,020 $ 3,149,573 $ 12,296,593 LIABILITIES AND STOCKHOLDERS EQUITY Current Liabilities: Cash overdraft $ 27,019 $ $ 27,019 Accounts payable 3,780,116 682,134 4,462,250 Accrued expenses 817,600 817,600 Merchant portfolio purchase insta …

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NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Companys consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Companys accounting estimates include the collectability of receivables, useful lives of long-lived assets and recoverability of those assets, impairment in fair value of goodwill, valuation allowances for income taxes and stock-based compensation. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, eVance Inc, eVance Capital Inc, Securus365, Inc., CrowdPay.us, Inc., OmniSoft, Inc., OLBit, Inc., DMINT, Inc., and DMINT Real Estate Holdings. The Company owns 100% of Cuentas SDI, LLC, which has been included in the consolidated financial statements. All significant intercompany transactions and balances have been eliminated. Fair Value of Financial Instruments The fair value is an exit price representing the amount that would be …

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NOTE 11 STOCKHOLDERS EQUITY During the year ended December 31, 2024, the Company sold 478,637 shares of common stock from its ATM Offering, for total proceeds of $1,090,890. During the year ended December 31, 2024, the Company issued 2,500 shares of common stock as a charitable contribution. The shares were valued at $1.89, the closing price on the date of grant, for total non-cash expense of $4,725. During the year ended December 31, 2024, there was an increase to additional paid in capital for stock option expense of $406,500. During the year ended December 31, 2024, there was a decrease to additional paid in capital for Series A preferred stock dividend expense of $124,903. On April 26, 2024, the Company filed with the Delaware Secretary of State a Certificate of Amendment to Certificate of Incorporation (the Certificate of Amendment) which became effective on April 26, 2024 to effect a one-for-ten (1:10) reverse stock split (the Reverse Stock Split) of the shares of the Companys common stock, par value $0.0001 per share (the Common Stock) The Reverse Stock Split was approved by the Companys stockholders at a special meeting on April 26, 2024. As a result of the Reverse Stock Split, every ten (10) shares of issued and outstanding Common Stock were automatically combined into one (1) issued and outstanding share of Common Stock, without any change in the par value per share. No fractional shares were issued as a result of the Reverse Stock Split and any fractional shares re …

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NOTE 18 SUBSEQUENT EVENTS In accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through, March 31, 2026, the date that the financial statements were issued and has determined that is has the following material subsequent events to disclose in these financial statements. On January 22, 2026, the Company entered into a securities purchase agreement with certain institutional investors pursuant to which it agreed to sell, in a registered direct offering, 2,166,666 shares of common stock and, in a concurrent private placement, warrants to purchase up to 2,166,666 additional shares of common stock at a combined purchase price of $0.60 per share and accompanying warrant. The warrants have an exercise price of $0.78 per share, are exercisable beginning six months after issuance, and expire five years from the date of issuance. The offering closed on January 26, 2026, generating aggregate net proceeds of approximately $1.3 million, before deducting placement agent fees and other offering expenses. The shares were issued pursuant to an effective shelf registration statement on Form S-3, while the warrants were issued in a private placement. On February 18, 2026, the Company entered into a securities purchase agreement with an institutional investor pursuant to which it issued, in a private placement, pre-funded warrants to purchase up to 2,857,142 shares of common stock and common warrants to purchase up to 3,571,428 shares of common stoc …

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