Marked against last year's 10-K:
cut words struck through, new words highlighted and underlined.
Accounting Policies 379 words changed in this paragraph; it is 33% similar to last year's version.
In determining the fair value of its digital assets, the Company uses quoted prices as determined by the Company’s principal market, which is Coinbase Prime. As such, the Company’s digital assets were determined to be Level 1 assets. See Digital assets below for a description of the Company’s digital asset accounting policy. In estimating the fair value of its covered call options, options sold on Bitcoin that it owns (the “covered call options”), the Company uses the Black-Scholes pricing Black model, which includes several inputs and assumptions assumptions, including the market forward price of the underlying asset (Bitcoin), the underlying asset’s implied volatility, the risk-free interest rate, and the expected term of the options. The expected term of the options is the contractual term of the options given the options can only be exercised on their expiry date (i.e., European-style options). The Company previously used the expiry date. Black-Scholes pricing model and reflected the observable forward price of the underlying asset in the estimation of fair value but now uses the Black model as the forward price of the underlying asset is a direct input of the Black model. The Company determined that the covered call options are Level 2 liabilities given all inputs are observable, but the options themselves are not traded in an active market. The Company estimates the fair value of its separated embedded derivative from convertible note using the partial differential equation model (“PDE Model”), which includes several inputs and assumptions including the Company’s common stock price at the time of valuation, the implied volatility of the Company’s common stock matching the moneyness of the conversion option, the risk-free interest rate curve, and the credit spread. In addition, management’s assumption of the probability of occurrence of the separated embedded derivative from the convertible note’s trigger event is a significant unobservable input. For quantitative disclosure on the inputs used to determine the fair value of the Company’s separated embedded derivative from convertible note, see Note 16. Derivatives. The Company determined that the separated embedded derivative from convertible note is a Level 3 liability given significant unobservable inputs are included in its valuation. The Company estimates the fair value of its Bitcoin redemption option using the Black-Scholes pricing model, which includes several inputs and assumptions including the market price of the underlying asset (Bitcoin), the underlying asset’s implied volatility, the risk-free interest rate, and the expected term of the redemption option. In addition, management’s assumption of the start of the redemption period, triggered by a shipment date of purchased property and equipment, is a significant unobservable input. For quantitative disclosure on the inputs used to fair value the Company’s Bitcoin redemption option, see Note 16. Derivatives. The Company determined that the Bitcoin redemption option is a Level 3 liability given a significant unobservable input is included in its valuation.
Source: Item 8, Note 2 – Basis of presentation, summary of significant accounting policies and recent accounting pronouncements, 10-K 0001104659-26-019392 vs Item 8, Note 2 – Basis of presentation, summary of significant accounting policies and recent accounting pronouncements, 10-K 0001558370-25-001996
Risk Factors 325 words changed in this paragraph; it is 42% similar to last year's version.
Threats to network and data security are increasingly diverse and sophisticated and sophisticated, such that security breaches, computer malware malware, and computer hacking attacks have been an increasing concern. Despite our efforts and processes in place to prevent them, our computer servers and systems may be vulnerable to cybersecurity risks, including denial-of-service attacks, physical or electronic break-ins, social engineering attacks, including phishing and business email compromise, employee theft or misuse and similar disruptions from unauthorized tampering. As techniques used to breach security change frequently and are generally not recognized until launched against a target, we may not be able to promptly detect that a cyber breach has occurred, implement security measures in a timely manner or, if and when implemented, we may not be able to determine the extent to which these measures could be circumvented. Recent developments in the cyber threat landscape include use of artificial intelligence (“AI”) and machine learning, as well as an increased number of cyber extortion and ransomware attacks, with the potential for higher ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology. Further, any adoption of AI by us or by third parties may pose new security challenges. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate the proprietary or sensitive information of us, our customers, or our employees, or cause interruptions or malfunctions in our operations or our customers’ operations. We also may be required to expend significant capital and resources to protect against such threats or to alleviate problems caused by cyber breaches in our physical or virtual security systems. Any breaches that may occur in the future could expose us to increased risk of lawsuits, regulatory penalties, loss of existing or potential customers, damage relating to loss of proprietary information, harm to our reputation, and increases in our security costs, which could have a material adverse effect on our business, financial condition, and results of operations. Furthermore, we hold our Bitcoin with third-party custodians. If our custodians are exposed to a cyberattack or breach, we may temporarily or permanently lose access to some or all of our Bitcoin, which would have a material adverse effect on our business, financial condition, and results of operations. See “Risks Related to Our Capital Needs and Capital Strategy—We may be subject to additional risks associated with holding Bitcoin for our own account.” The cybersecurity regulatory landscape continues to evolve and compliance with the proposed reporting requirements could further complicate our ability to resolve cyberattacks. Although we maintain insurance coverage for certain cyber risks, such coverage may be unavailable or insufficient to cover our losses.
Source: Item 1A, 10-K 0001104659-26-019392 vs Item 1A, 10-K 0001558370-25-001996
MD&A 292 words changed in this paragraph; it is 35% similar to last year's version.
Other income was $22.2 million for the twelve months ended December 31, 2025, compared to other expense was of $8.6 million for the twelve months ended December 31, 2024, compared to other income of $12.6 million for the twelve months ended December 31, 2023. 2024. This $21.2 $30.8 million increase was primarily driven by (i) a $17.7 $54.8 million increase in gain on derivatives related to our Bitcoin redemption option and call options, (ii) an $8.4 million increase in foreign exchange gain, (iii) a $1.0 million increase in gain on other financial liability, and (iv) a $0.4 million increase in gain on warrant liability. These gains were partially offset by (i) a $22.8 million increase in asset contributions costs related to the launch of American Bitcoin, (ii) a $6.0 million decrease in gain on debt extinguishment related to the Anchorage debt-to-equity conversion of $6.0 million in 2024, compared to $23.7 million debt extinguishment related to the NYDIG loan recorded in 2023, (ii) a $3.6 million increase in interest expense due to an increase in the amount of borrowing in 2024 compared to 2023, which comprised of the $150.0 million Coatue note and the additional $15.0 million drawdown from our loan with Coinbase Credit, Inc. (“Coinbase”), extinguishment, (iii) a $6.0 million increase in foreign exchange loss due to our net U.S. dollar monetary liability position in our Canadian dollar functional currency subsidiaries and a decline in the Canadian dollar to U.S. dollar exchange rate of approximately 8% compared to a 2% increase during the twelve months ended December 31, 2023 (the increase noted in the prior period is for the period from the Business Combination to December 31, 2023, reflecting one month of combined company results), and (iv) a $2.0 $3.1 million decrease in equity in earnings of King Mountain JV due to the impact of the Halving on Bitcoin Mining revenue. These increases were partially offset by (i) a $7.3 million gain on derivatives due to an increase in the mark-to-market value of our call options and Bitcoin redemption option, and (ii) a $3.1 million gain on bargain purchase related to the Far North JV acquisition driven by in the fair value prior period, (iv) a $1.6 million decrease in equity in earnings of the net assets acquired being greater than the consideration transferred. unconsolidated joint venture, and (v) a $0.3 million decrease in interest expense due to lower interest rates on our outstanding debt.
Source: Item 7, 10-K 0001104659-26-019392 vs Item 7, 10-K 0001558370-25-001996
Legal Proceedings 111 words changed in this paragraph; it is 37% similar to last year's version.
Based On December 30, 2025, a stockholder filed a complaint under 8 Del. C. § 220 in the Delaware Court of Chancery seeking an order compelling the Company to produce certain books and records. On January 14, 2026, a separate stockholder filed a similar complaint. The Company produced books and records to both stockholders, subject to confidentiality agreements. The parties in the first action submitted a stipulation and proposed order to stay the case. The complaint in the second action has not been served on the Company. The Company believes it has complied with its obligations under Section 220 to provide the stockholders with copies of books and records, however, based on the preliminary nature of these proceedings, the outcome of these matters remains uncertain uncertain, and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time.
Source: Item 3, via Note 24 – Commitments and contingencies, 10-K 0001104659-26-019392 vs Item 3, via Note 24 – Commitments and contingencies, 10-K 0001558370-25-001996