OLB Group (OLB) revenue falls to $2.9M as losses narrow and bitcoin spin-off advances
Rhea-AI Filing Summary
The OLB Group, Inc. reported lower revenue but a smaller loss for the six months ended June 30, 2026. Total revenue was $2.94 million, down from $4.59 million a year earlier, mainly due to lower transaction and processing fees. The company recorded a net loss of $2.13 million, compared with a $3.21 million loss in the prior-year period, helped by reduced operating and interest expenses and a gain on settlement of accounts payable and debt.
Cash increased to $1.28 million from $15,777 at year-end 2025, supported by roughly $3.7 million of gross proceeds from a registered direct offering and a private placement with pre-funded and common warrants. Total assets were $13.94 million and stockholders’ equity rose to $7.14 million, while total liabilities declined to $6.80 million.
The business operates two segments: Fintech Services, centered on the SecurePay payment gateway and ISO merchant acquiring, and Bitcoin Mining through DMINT. Management is spinning off DMINT via a pending S‑1 and is adding AI-driven “agentic commerce” features and AI-assisted software development across platforms. Management concluded there is no substantial doubt about the company’s ability to continue as a going concern for at least one year, based on existing cash, recent financings, an at-the-market equity program and a related-party loan facility.
Positive
- None.
Negative
- Revenue declined significantly: total revenue for the six months ended June 30, 2026 fell to $2,935,595 from $4,588,727 in 2025, driven largely by lower transaction and processing fees.
Filing Explained
The filing reports 24,020,313 shares outstanding on August 14 versus 15,750,313 on June 30, creating a larger base for existing holders’ ownership.
OLB Group reports 24,020,313 common shares outstanding as of
As an unaudited quarterly report, the filing updates interim financial statements and related disclosures. Its subsequent-events note records three issuances on
At
The named next milestone in the New York litigation is OLB’s submission of summary-judgment papers due
Key Figures
Key Terms
at the market offering financial
money transmitter licenses regulatory
agentic commerce technical
vibe coding technical
Earnings Snapshot
FAQ
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AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from _______ to _______
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(Exact name of registrant as specified in its charter)
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Securities registered pursuant to Section 12(b) of the Act:
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| The |
Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
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Indicate by check mark whether
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| ☒ | Smaller reporting company | ||
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indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
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As of August 14, 2026, there were
THE OLB GROUP, INC.
FORM 10-Q
For the Quarterly Period Ended June 30, 2026
INDEX
| PART I | Financial Information | 1 |
| Item 1. | Financial Statements (unaudited) | 1 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 26 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 33 |
| Item 4. | Controls and Procedures | 33 |
| PART II | Other Information | 34 |
| Item 1. | Legal Proceedings | 34 |
| Item 1A. | Risk Factors | 34 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 35 |
| Item 3. | Defaults Upon Senior Securities | 35 |
| Item 4. | Mine Safety Disclosures | 35 |
| Item 5. | Other Information | 35 |
| Item 6. | Exhibits | 36 |
| Signatures | 37 | |
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
INDEX TO FINANCIAL STATEMENTS
| Condensed Consolidated Balance Sheets as of June 30, 2026 (unaudited) and December 31, 2025 | 2 | |
| Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) | 3 | |
| Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) | 4 | |
| Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 (unaudited) | 5 | |
| Notes to the Condensed Consolidated Financial Statements (unaudited) | 6 |
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The OLB Group, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
| June 30, 2026 | December 31, 2025 | |||||||
| ASSETS | (Unaudited) | (Audited) | ||||||
| Current Assets: | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Prepaid expenses | ||||||||
| Other receivables | ||||||||
| Other current assets | ||||||||
| Total Current Assets | ||||||||
| Other Assets: | ||||||||
| Property and equipment, net | ||||||||
| Goodwill | ||||||||
| Other long-term assets | ||||||||
| Total Other Assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Cash overdraft | $ | $ | ||||||
| Accounts payable | ||||||||
| Accrued expenses | ||||||||
| Merchant portfolio purchase installment obligation | ||||||||
| Related party payable | ||||||||
| Accrued interest – related party | ||||||||
| Note payable – current portion | ||||||||
| Total Current Liabilities | ||||||||
| Long Term Liabilities: | ||||||||
| Total Liabilities | ||||||||
| Commitments and contingencies (Note 12) | ||||||||
| Stockholders’ Equity: | ||||||||
| Preferred stock, $ | ||||||||
| Series A Preferred stock, $ | ||||||||
| Common stock, $0.0001 par value, 50,000,000 shares authorized, 15,762,930 and 9,450,749 shares issued, 15,750,313 and 9,438,132 shares outstanding at June 30, 2026 and December 31, 2025, respectively | ||||||||
| Treasury stock, at cost, | ( | ) | ( | ) | ||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Stockholders’ Equity | ||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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The OLB Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue: | ||||||||||||||||
| Transaction and processing fees | $ | $ | $ | $ | ||||||||||||
| Merchant equipment rental and sales | ||||||||||||||||
| Revenue, net - cryptocurrency mining | ||||||||||||||||
| Other revenue from monthly recurring subscriptions | ||||||||||||||||
| Digital product revenue | ||||||||||||||||
| Total revenue | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| Processing and servicing costs, excluding merchant portfolio amortization | ||||||||||||||||
| Amortization and depreciation expense | ||||||||||||||||
| Depreciation expense – cryptocurrency mining | ||||||||||||||||
| Salaries and wages | ||||||||||||||||
| Professional fees | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Unrealized loss of cryptocurrency | ( | ) | ( | ) | ||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Loss on conversion related party | ( | ) | ( | ) | ||||||||||||
| Gain (loss) on settlement of accounts payable and debt | ( | ) | ( | ) | ||||||||||||
| Loss on settlement of law suit | ( | ) | ( | ) | ||||||||||||
| Total other income (expense) | ( | ) | ( | ) | ||||||||||||
| Net Loss before income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income tax expense | ||||||||||||||||
| Net Loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Preferred dividends (related parties) | ( | ) | ||||||||||||||
| Deemed dividend – preferred stock | ( | ) | ( | ) | ||||||||||||
| Net Loss Applicable to Common Shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per common share, basic and diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted average shares outstanding, basic and diluted | ||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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The OLB Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Stockholders’ Equity
For the Three and Six Months Ended June 30, 2026 and 2025
(Unaudited)
| Preferred Stock | Common Stock | Additional Paid | Common Stock To be | Treasury | Accumulated | |||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | In Capital | Issued | Stock | Deficit | Total | ||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||||||
| Common stock issued for services – related party | — | — | — | |||||||||||||||||||||||||||||||||
| Common stock issued for accounts payable | — | |||||||||||||||||||||||||||||||||||
| Common stock issued for services | — | — | ||||||||||||||||||||||||||||||||||
| Common stock issued for cash | — | |||||||||||||||||||||||||||||||||||
| Prefunded warrants sold for cash | — | |||||||||||||||||||||||||||||||||||
| Shares returned and cash returned | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Common stock issued for services – related party | — | — | ( | ) | — | — | ||||||||||||||||||||||||||||||
| Exercise of prefunded warrants | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||||||||
| Preferred Stock | Common Stock | Additional Paid | Common Stock To be | Treasury | Accumulated | |||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | In Capital | Issued | Stock | Deficit | Total | ||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | — | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||||||||
| Common stock sold for cash | — | — | — | — | ||||||||||||||||||||||||||||||||
| Preferred stock dividends-related party | — | — | — | — | ( | ) | — | — | — | ( | ) | |||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Common stock issued for accrued salary and loans payable – related party | — | — | — | — | — | |||||||||||||||||||||||||||||||
| Common stock to be issued for accounts payable | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Preferred stock converted to common | ( | ) | ( | ) | ( | ) | — | — | — | |||||||||||||||||||||||||||
| Accrued preferred stock dividends converted to common | — | — | — | — | — | |||||||||||||||||||||||||||||||
| Preferred stock dividend contributed to capital | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Common stock issued for services – related party | — | — | — | — | — | |||||||||||||||||||||||||||||||
| Common stock sold for cash | — | — | — | — | — | |||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Deemed dividend – preferred stock | — | — | — | — | — | — | ( | ) | — | |||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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The OLB Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operations: | ||||||||
| Depreciation and amortization | ||||||||
| Stock based compensation – related party | ||||||||
| Common stock issued for services – related party | ||||||||
| (Gain) loss on settlement of accounts payable and debt | ( | ) | ||||||
| Unrealized loss of cryptocurrency | ||||||||
| Operating lease expense, net of repayment | ||||||||
| Loss on conversion related party | ||||||||
| Loan extinguishment related expense | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | ||||||||
| Prepaid expenses and other current assets | ( | ) | ( | ) | ||||
| Other long-term assets | ||||||||
| Accounts payable | ( | ) | ||||||
| Accrued interest – related party | ||||||||
| Accrued expenses | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Cash overdraft | ( | ) | ||||||
| Common stock sold for cash | ||||||||
| Advances from related party | ||||||||
| Repayments to related party | ( | ) | ( | ) | ||||
| Proceeds from the sale of prefunded warrants | ||||||||
| Returned cash settlement | ||||||||
| Repayments on note payable | ( | ) | ( | ) | ||||
| Net cash provided by financing activities | ||||||||
| Net change in cash | ( | ) | ||||||
| Cash – beginning of period | ||||||||
| Cash – end of period | $ | $ | ||||||
| Cash paid for: | ||||||||
| Interest | $ | $ | ||||||
| Income taxes | $ | $ | ||||||
| Non-cash investing and financing transactions: | ||||||||
| Preferred stock dividends | $ | $ | ||||||
| Common stock issued for prepaid services | $ | $ | ||||||
| Common stock issued for settlement of accounts payable and debt | $ | $ | ||||||
| Common stock issued for accrued liabilities – related party | $ | $ | ||||||
| Common stock issued for loans payable – related party | $ | $ | ||||||
| Common stock issued for accrued salary – related party | $ | $ | ||||||
| Common stock issued for interest – related party | $ | $ | ||||||
| Common stock payable for payment of accrued expenses | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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The OLB Group, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
June 30, 2026
(Unaudited)
NOTE 1 – BACKGROUND
Background
The OLB Group, Inc. (“OLB”, the “Company”)
was incorporated in the State of Delaware on
Beginning in 2026, the Company transitioned its entire software development team to an artificial intelligence-assisted model for developing and maintaining its applications (commonly referred to as “vibe coding”), under which the Company’s developers direct and review code generated by large language model tools rather than authoring code directly. The transition applies across both business segments.
Fintech Services:
The Company provides integrated financial and transaction processing services (“Fintech Services”) to businesses throughout the United States. Its Fintech Services span credit and debit card acceptance, ACH payments, real-time payments, digital wallets, PayPal integration and payment terminal and hardware rentals.
SecurePay™, the Company’s proprietary payment gateway, is the core of these services. Card, ACH and real-time payment transactions are routed and authorized through SecurePay™, which also delivers PayPal integration and supports 3-D Secure (Visa) authentication on card-not-present transactions, helping merchants reduce fraud and, for authenticated transactions, shift chargeback liability to the card issuer.
The Company delivers these services through its eVance, Inc. subsidiary (“eVance”), which provides an integrated suite of merchant payment processing services and related proprietary software, primarily to small and mid-sized merchants operating in physical “brick and mortar” business environments, on the internet and in retail settings requiring both wired and wireless mobile payment solutions.
eVance operates as an independent sales organization (“ISO”) generating individual merchant processing contracts in exchange for future residual payments. As a wholesale ISO, eVance has a direct contractual relationship with the merchants and takes greater responsibility in the approval and monitoring of merchants and risk and as a result, receives additional charges for this service and risk.
Implementation of Agentic Commerce and Automation Services. The Company is implementing agentic commerce and automation services across its Fintech Services platforms, adding artificial intelligence (“AI”) capabilities to each existing platform, including conversational AI support tools and AI-assisted risk mitigation and fraud monitoring capabilities for eVance merchants; AI-driven underwriting and merchant boarding workflows intended to support same-day merchant approval, including background checks, sanctions screening and PCI compliance verification; a new point-of-sale (“POS”) solution with embedded AI functionality; and tools for the Company’s ISOs and sales personnel intended to accelerate the calculation and payment of residual compensation. Human review and oversight remain in place for underwriting, risk and compliance activities. Certain of these capabilities remain in development and have not yet been deployed to merchants. See “Artificial Intelligence and Agentic AI Initiatives” in Item 2 of this Quarterly Report.
CrowdPay.us, Inc. (“CrowdPay”) is
a Crowdfunding platform used to facilitate a capital raise anywhere from $
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OmniSoft, Inc. (“OmniSoft”) operates a software platform for small merchants. The Omnicommerce applications work on an iPad, mobile device and the web and allow customers to sell a store’s products in a physical, retail setting. To date, the activities of this subsidiary have been nominal when compared to the overall business.
The Company markets its AI-enabled merchant applications under the iStores AI and ShopFast AI brands, and provides credit card payment gateway services under the SecurePay™ brand. SecurePay™ is designed primarily around AI-based fraud detection, including real-time transaction screening and dynamic risk scoring, together with AI-assisted merchant boarding and underwriting workflows. SecurePay™ integrates with third-party accounting, payment and authentication providers, including QuickBooks, PayPal, 3-D Secure authentication (a protocol developed by Visa) and TSYS, a payment processor. SecurePay™ also supports automated clearing house (“ACH”) payment services.
On May 14, 2021, the Company formed its wholly owned subsidiary, OLBit, Inc. (“OLBit”). The purpose of OLBit is to hold the Company’s assets and operate its business related to its emerging lending and transactional business leveraging the Company’s Bitcoin Business and Fintech Services business. To date, the activities of this subsidiary have been nominal. The Company is resuming the process of obtaining money transmitter licenses (“MTLs”) for OLBit, including the preparation and submission of license applications in the states in which the Company intends to conduct OLBit’s lending and transactional business, and is continuing to plan the scope and sequencing of those filings. Issuance of MTLs is subject to review and approval by state regulators, and there is no assurance that the Company will obtain any MTL, or that it will do so on the timeline it currently anticipates.
On June 15, 2023, the Company purchased Moola
Cloud, LLC (“Moola Cloud”), formerly known as SDI, LLC a Florida LLC whose platform and network serve approximately
Moola Cloud is a wholly owned subsidiary. The new POS solution described above is being developed for the Moola Cloud merchant network and will combine payment acceptance with a self-service website builder, enabling merchants to create and maintain their own eCommerce storefronts alongside their in-store operations. The POS solution has been upgraded and is ready for implementation at merchant locations.
The Company also provides eCommerce development and consulting services on a project-by-project basis, including custom artificial intelligence-based development projects for merchants and other clients that are related to transaction processing and other transaction-driven activities.
Bitcoin Mining Business:
On July 23, 2021, the Company formed its wholly owned subsidiary, DMINT, Inc., (“DMINT”). The purpose of DMINT is to operate its business related to Bitcoin mining (“Bitcoin Business”). The Company is currently in the process of spinning off DMINT into a stand-alone entity. On October 21, 2024, DMINT filed a Registration Statement on Form S-1 with the Securities and Exchange Commission relating to the proposed spin-off and the resulting issuance of DMINT equity to the Company’s stockholders. The spin-off distribution is expected to occur upon the Registration Statement being declared effective and the approval by the Nasdaq Capital Market of the listing of DMINT’s common stock, at which time the shares of DMINT common stock held by the Company are expected to be distributed to the Company’s stockholders on a pro rata basis. Completion of the spin-off is subject to these conditions, and there is no assurance that the spin-off will be completed.
On June 24, 2022 the Company formed DMINT Real Estate Holdings, Inc., a wholly-owned subsidiary of DMINT. The purpose of DMINT Real Estate Holdings, Inc is to buy and hold real estate related to DMINT. Currently, its only asset is the building and property located in Selmer, Tennessee where all of the mining computers are located.
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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company as of and for the six month period ending June 30, 2026 and not necessarily indicative of the results to be expected for the full year ending December 31, 2026. These unaudited financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
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 Company’s 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
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 received to sell an asset or required to transfer a liability in an orderly transaction between market participants. As such, fair value of a financial instrument is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or a liability.
The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts receivable, prepaid expenses, other receivables, other current assets, accounts payable, accrued expenses, related party payable and note payable, approximate their fair values because of the short maturity of these instruments. The fair value of options and warrants is estimated using the Black-Scholes option pricing model or other appropriate valuation techniques. Key assumptions include expected volatility, risk-free interest rate, expected term, and dividend yield. These inputs are based on observable market data where available (Level 2) or, when necessary, management’s estimates (Level 3). Fair value measurements are reassessed at each reporting date, and any changes are reflected in the financial statements.
Three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value.
| ● | Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| ● | Level 2: Observable inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. |
| ● | Level 3: Unobservable inputs reflecting our own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participants’ assumptions that are reasonably available. |
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Concentration of Credit Risk
Financial instruments that potentially expose
the Company to concentration of credit risk consist primarily of cash and accounts receivable. The Company’s cash is deposited with
major financial institutions. At times, such deposits may be in excess of the Federal Deposit Insurance Corporation insurable amount (“FDIC”).
As of June 30, 2026 and December 31, 2025, the Company had $
Operating Segments
Operating segments are defined as components of
an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (“CODM”),
or decision maker group, in deciding how to allocate resources to an individual segment and in assessing performance. Our chief operating
decision–making group is composed of the Chief Executive Officer and Vice President. The Company has
Stock-based Compensation
We account for equity-based transactions with employees and non-employees under the provisions Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) of ASC Topic 718, “Compensation – Stock Compensation” (“Topic 718”), which establishes that equity-based payments to employees and non-employees are recorded at the grant date the fair value of the equity instruments the entity is obligated to issue when the employees and non-employees have rendered the requisite service and satisfied any other conditions necessary to earn the right to benefit from the instruments. Topic 718 also states that observable market prices of identical or similar equity or liability instruments in active markets are the best evidence of fair value and, if available, should be used as the basis for the measurement for equity and liability instruments awarded in these share-based payment transactions. However, if observable market prices of identical or similar equity or liability instruments are not available, the fair value shall be estimated by using a valuation technique or model that complies with the measurement objective, as described in Topic 718.
Net Loss per Share
Basic net loss per share of common stock is computed
by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common
share is computed by dividing net loss by the weighted average number of shares of common stock and dilutive potentially outstanding shares
of common stock during the period. The weighted average number of common shares for the six months ended June 30, 2026 and 2025 does not
include warrants to acquire
Bitcoin
The Company earns bitcoin through its cryptocurrency mining activities and accounts for the related mining revenue in accordance with its revenue recognition policy. Bitcoin held by the Company meets the criteria for accounting under ASC 350-60, Intangibles—Goodwill and Other—Crypto Assets. The Company measures its bitcoin holdings at fair value at each reporting date, with changes in fair value recognized in net income. Bitcoin is not amortized and is not subject to the impairment model applicable to other indefinite-lived intangible assets.
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The fair value of bitcoin is determined using quoted market prices from the Company’s principal market as of the reporting date in accordance with ASC 820, Fair Value Measurement. Gains and losses resulting from changes in the fair value of bitcoin are presented separately from changes in the carrying amounts of other intangible assets in the consolidated statements of operations. Upon disposition of bitcoin, the Company recognizes the difference between the proceeds received and the carrying value of the bitcoin disposed of in net income.
At June 30, 2026 and December 31, 2025, the carrying value of
the Company’s bitcoin was $
Property and Equipment
Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets. Depreciation is calculated once the asset has been received and is ready for its intended use, using half of the monthly depreciation in the first month and half of the monthly depreciation in the last month. Cost and accumulated depreciation applicable to items replaced or retired are eliminated from the related accounts with any gain or loss on the disposition included in the statement of operations. Expenditures for repairs and maintenance are expensed as incurred.
The Company capitalizes all capital assets utilizing the following criteria:
| ● | All land acquisitions;. |
| ● | All buildings/facilities acquisitions and new construction; |
| ● | Facility renovation and improvement projects costing more than $ |
| ● | Land improvement and infrastructure projects costing more than $ |
| ● | Equipment costing more than $ |
| ● | Computer equipment costing more than $ |
| ● | Construction in Progress (CIP) for capital projects with a budget in excess of $ |
The estimated useful lives for all the Company’s property and equipment are as follows:
| Item | Useful Life | |
| Computer equipment | ||
| Software | ||
| Office furniture | ||
| Buildings and improvements |
Intangible Assets
The Company accounts for its intangible assets in accordance with FASB ASC Subtopic 350-30, General Intangibles Other Than Goodwill. ASC Subtopic 350-30, which requires assets to be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is more clearly evident and, thus, more reliably measurable. Under ASC Subtopic 350-30 any intangible asset with a useful life is required to be amortized over that life and the useful life is to be evaluated every reporting period to determine whether events or circumstances warrant a revision to the remaining period of amortization. If the estimate of useful life is changed the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. Costs to renew or extend the term of an intangible assets are recognized as an expense when incurred.
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Impairment of Long-Lived Assets
In accordance with ASC 360-10, Impairment Testing of Long-Lived Assets Held and Used, the Company periodically reviews the carrying value of its long-lived assets held and used at least annually or when events and circumstances warrant such a review. If significant events or changes in circumstances indicate that the carrying value of an asset or asset group may not be recoverable, the Company performs a test of recoverability by comparing the carrying value of the asset or asset group to its undiscounted expected future cash flows. Cash flow projections are sometimes based on a group of assets, rather than a single asset. If cash flows cannot be separately and independently identified for a single asset, the Company determines whether impairment has occurred for the group of assets for which it can identify the projected cash flows. If the carrying values are in excess of undiscounted expected future cash flows, it measures any impairment by comparing the fair value of the asset group to its carrying value. If the fair value of an asset or asset group is determined to be less than the carrying amount of the asset or asset group, impairment in the amount of the difference is recorded.
Goodwill
The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805, Business Combinations, where the total purchase price is allocated to the tangible and identified intangible assets acquired and liabilities assumed based on their estimated fair values. The purchase price is allocated using the information currently available, and may be adjusted, up to one year from acquisition date, after obtaining more information regarding, among other things, asset valuations, liabilities assumed and revisions to preliminary estimates. The purchase price in excess of the fair value of the tangible and identified intangible assets acquired less liabilities assumed is recognized as goodwill.
The Company tests for indefinite-lived intangibles and goodwill impairment in the fourth quarter of each year and whenever events or circumstances indicate that the carrying amount of the asset exceeds its fair value and may not be recoverable. The goodwill is related to the Fintech reporting unit of OLB Group, Inc. All of its subsidiaries except DMint, Inc. are included in the Fintech Reporting Unit. DMint is a separate reporting unit and is engaged in Bitcoin mining activities. In accordance with ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, the Company performed a quantitative assessment of goodwill and determined there was no impairment at December 31, 2025.
A summary of goodwill as of June 30, 2026, is as follows:
| Acquisition of assets from Excel Corporation and its subsidiaries on April 9, 2018 | $ | |||
| Acquisition of | ||||
| Goodwill balance as of June 30, 2026 | $ |
Accounts Receivable
Accounts receivable represents contractual residual
payments due from the Company’s processing partners or other customers. Residual payments are determined based on transaction fees
and revenues from the credit and debit card processing activity of merchants for which the Company’s processing partners pay the
Company. Based on collection experience and periodic reviews of outstanding receivables, we have recorded an allowance balance of $
Reserve for Chargeback Losses
Disputes between a cardholder and a merchant periodically arise as a result of, among other things, cardholder dissatisfaction with merchandise quality or merchant services. Such disputes may not be resolved in the merchant’s favor. In these cases, the transaction is “charged back” to the merchant, which means the purchase price is refunded to the customer through the merchant’s bank and charged to the merchant. If the merchant has inadequate funds, the Company must bear the credit risk for the full amount of the transaction. The Company evaluates the risk for such transactions and estimates the potential loss for chargebacks based primarily on historical experience and records a loss reserve accordingly. During the three and six months ended June 30, 2026 and 2025 chargebacks have reduced recorded revenue amounts and no reserve for loss has been recorded as of June 30, 2026 and 2025.
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Revenue Recognition
The following table presents the Company’s revenue disaggregated by revenue source:
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue: | ||||||||||||||||
| Transaction and processing fees | $ | $ | $ | $ | ||||||||||||
| Merchant equipment rental and sales | ||||||||||||||||
| Revenue, net - cryptocurrency mining | ||||||||||||||||
| Other revenue from monthly recurring subscriptions | ||||||||||||||||
| Digital product revenue | ||||||||||||||||
| Total revenue | $ | $ | $ | $ | ||||||||||||
The Company recognizes revenue under ASC 606, “Revenue from Contracts with Customers” (“ASC 606”). The Company determines revenue recognition through the following steps:
| ● | Identification of a contract with a customer; |
| ● | Identification of the performance obligations in the contract; | |
| ● | Determination of the transaction price; | |
| ● | Allocation of the transaction price to the performance obligations in the contract; and | |
| ● | Recognition of revenue when or as the performance obligations are satisfied. |
Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Shipping and handling activities associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment activity and recognized as revenue at the point in time at which control of the goods transfers to the customer. As a practical expedient, the Company does not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less.
Transaction and processing fees
Fees for the Company’s transaction and processing arrangements are typically billed and paid on a monthly basis. The Company receives a percentage of recurring monthly transaction related fees comprised of credit and debit card fees charged to merchants, net of association fees, otherwise known as Interchange, as well as certain service charges and convenience fees, for payment processing services, including authorization, capture, clearing, settlement and information reporting of electronic transactions. Fees are calculated on either a percentage of the dollar, volume of the transaction or a fixed fee or a hybrid of the two and are recognized at the time of the transaction. These merchant services represent a single performance obligation satisfied over time and that the same measure of progress should be used to measure the Company’s progress toward complete satisfaction of the performance obligation. The Company recognizes revenue on a monthly basis as the services are transferred to the customer in short daily increments that qualify for series guidance as the best measure of the transfer of control.
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In wholesale contracts, the Company recognizes transaction and processing fees on a gross basis as the Company is the principal in the merchant services. The Company has concluded it is the principal because it has a direct contractual relationship with the merchant, is primarily responsible for the delivery of services to the merchants, including performing underwriting, has discretion in setting prices, and bears risk of chargebacks and other merchant losses. The Company also has the unilateral ability to accept or reject a transaction based on criteria established by the Company. As the principal, the Company records the full discount charged to the merchant as revenue and the related interchange and other processing fees within cost of revenues.
In retail contracts, the Company is not responsible for merchant underwriting, has no chargeback liability and has no or limited contractual relationship with the merchant. As such, the Company records the net amount it receives from the processor, after interchange and other processing fees, as revenue.
Merchant equipment rental and sales
The Company generates revenue through the sale and rental of merchant equipment. Revenue is recognized when billed. The Company satisfies its performance obligation upon delivery of equipment to merchants and recognizes revenue at a point in time. The Company allows for customer returns which are accounted for as variable consideration. The Company estimates these amounts based on historical experience and reduces revenue recognized. The Company invoices customers upon delivery of the equipment to merchants, and payments from such customers are due upon invoicing. The Company offers hardware installment sales to customers with terms ranging from three to forty-eight months. The Company allocates a portion of the consideration received from these arrangements to a financing component when it determines that a significant financing component exists. The financing component is subsequently recognized as financing revenue separate from hardware revenue, within subscription and services-based revenue, over the terms of the arrangement with the customer. Pursuant to practical expedients afforded under ASC 606, the Company does not recognize a financing component for hardware installment sales that have a term of one year or less.
Monthly recurring subscriptions
The Company generates recurring revenue through monthly subscriptions for software services. This service is provided based on an agreement with the customer regarding software services. Performance obligations are promises in a contract to a customer. In the subscription model, each billing period represents a performance obligation. The transaction price is the amount of consideration the Company expects to receive in exchange for transferring goods or services. For recurring revenue, this is the subscription fee. The Company allocates to the performance obligation based on the selling price for the subscription. If the criteria for recognizing revenue over time are met, revenue is recognized over the period of performance. For subscription and recurring fee, this means recognizing revenue each billing period.
Cryptocurrency mining:
The Company entered into contracts with digital asset mining pool operators to provide the service of performing hash computations for the mining pool operator. The contracts are continuously renewable and are terminable at any time by either party and the Company’s enforceable right to compensation only begins when the Company provides computing power to the mining pool operator. In exchange for providing computing power, the Company is entitled to a fractional share of Bitcoin. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. Hashrate is the measure of the computational power per second used when mining.
Providing computing power in Bitcoin transaction verification services is an output of the Company’s ordinary activities. The provision of computing power is the only performance obligation in the Company’s contracts with third party pool operators. The transaction consideration the Company receives, if any, is noncash consideration, which is all variable. Because it is not probable that a significant reversal of cumulative revenue will not occur, the consideration is constrained until the Company successfully places a block (by being the first to solve an algorithm) and the Company receives confirmation of the consideration it will receive, at which time revenue is recognized. There is no significant financing component in these transactions.
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The Company earns Bitcoin during the time period 00:00:00 UTC and 23:59:59 UTC (“24-hour Period”) unless terminated in accordance with the terms set forth by the terms of service. In exchange for performing hash computations for the mining pool. The Company performs hash computations for one mining pool operator, Foundry USA. Foundry USA operates its pool on the Full Pay Per Share (FPPS) payout method. FPPS is a variant of the Pay Per Share (PPS) method, where miners receive a fixed payout for each valid share submitted, regardless of whether the pool finds a block.
The fair value of the Bitcoin award received is
determined using the intraday average quoted price of the Bitcoin over the 24-Hour Period. The Company’s Bitcoin earned are actively
traded on the major trading platforms. The Company considers Coinbase to be its primary market. The consideration the Company will receive,
comprised of block rewards, transaction fees less mining pool operator fees are aggregated, over the 24-Hour Period, in a sub-balance
account held by the mining pool operator, which is finalized one hour later at 1AM UTC. The sub-balance account is then withdrawn to the
Company’s whitelisted wallet address, once a day, between the hours of 9am to 5pm UTC time (the “Settlement”). The rate
of payment occurs once per day, as long as the minimum payout threshold of
Pursuant to ASC 606-10-55-42, Revenue from Contracts with Customers, the Company assessed if the customer’s option to renew represented a material right that represents a separate performance obligation and noted the renewal is not a material right. The definition of a material right is a promise in a contract to provide goods or services to a customer at a price that is significantly lower than the stand-alone selling price of the good or service. The mining pool operator does not provide any discounts and as such there is no economic benefit to the customer and as such a separate performance obligation does not exist under 606-10-55-42. In addition, there are no options for renewal that are separately identifiable from other promises in the contract, such as an ability to extend the contract at a reduced price.
The performance obligation of the Bitcoin miner under the mining contracts with Foundry Pool USA involves the service of performing hash computations to facilitate the verification of digital asset transactions. The Company’s miners contribute computing power (i.e., hashrate) that perform hash calculations to the mining pool operator, engaging in the process of validating and securing transactions through the generation of Bitcoin hashes. The mining pool then utilizes a specific mining algorithm (e.g. SHA-256) to submit shares (proof of work) to the mining pool’s server as they contribute to solving the Bitcoin puzzles required to mine a block. The Company reviews and analyzes its individual pool performance using a dashboard provided by Foundry Pool USA that includes real-time statistics on hashrate, shares submitted and earnings. The service of performing hash computations in digital asset transaction verification services is an output of the Company’s ordinary activities. The provision of providing these services is the only performance obligation in the Company’s contracts with mining pool operators. The Company performs hash computations for one mining pool operator, Foundry USA. Foundry USA operates its pool on the Full Pay Per Share (FPPS) payout method. FPPS is a variant of the Pay Per Share (PPS) method, where miners receive a fixed payout for each valid share submitted, regardless of whether the pool finds a block.
Regardless of the pool’s success, the Company will receive consistent rewards based on the number of valid shares it contributes. The transaction consideration the Company receives is non-cash consideration, in the form of bitcoin. The Company measures the bitcoin at fair value on the date earned using the average price (calculated by averaging the daily open price and the daily close price) quoted by its Principal Market at the date the Company completed the service of performing hash computations for the mining pool operator. There are no deferred revenues or other liability obligations recorded by the Company since there are no payments in advance of performance. At the end of each 24 hour period (00:00:00 UTC and 23:59:59 UTC), there are no remaining performance obligations. By utilizing the average daily price of bitcoin on the date earned, the Company eliminates any differences that may arise due to the volatility in trading price between bitcoin and fiat currency during the period where the Company establishes and completes the contract. The consideration is all variable. There is no significant financing component in these transactions.
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If authoritative guidance is enacted by the FASB, the Company may be required to change its policies, which could affect the Company’s financial position and results from operations.
Digital product revenue
The Company generates revenue through electronic
distribution and sale of digital products that range from prepaid wireless SIM activation, international mobile recharge services and
international long distance phone service. The Company generally obtains payment upfront and its performance obligation is to provide
products and/or calling services. When products are provided at the point of sale, revenue is recognized immediately and at the time of
payment. When a customer purchases a prepaid telecom product, such as a prepaid mobile phone plan, the revenue is initially recorded
as a customer deposit and revenue is recognized over the relevant performance period as customers utilize the prepaid telecom services.
As of June 30, 2026 and December 31, 2025, customer deposits were
Leases
The Company determines whether an arrangement contains a lease at the inception of the arrangement. If a lease is determined to exist, the term of such lease is assessed based on the date on which the underlying asset is made available for the Company’s use by the lessor. The Company’s assessment of the lease term reflects the non-cancelable term of the lease, inclusive of any rent-free periods and/or periods covered by early-termination options which the Company is reasonably certain of not exercising, as well as periods covered by renewal options which the Company is reasonably certain of exercising. The Company also determines lease classification as either operating or finance at lease commencement, which governs the pattern of expense recognition and the presentation reflected in the consolidated statements of operations over the lease term.
For leases with a term exceeding 12 months, an operating lease liability is recorded on the Company’s consolidated balance sheet at lease commencement reflecting the present value of its fixed minimum payment obligations over the lease term. A corresponding operating lease right-of-use asset equal to the initial lease liability is also recorded, adjusted for any prepaid rent and/or initial direct costs incurred in connection with execution of the lease and reduced by any lease incentives received. For purposes of measuring the present value of its fixed payment obligations for a given lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates implicit in its leasing arrangements are typically not readily determinable. The Company’s incremental borrowing rate reflects the rate it would pay to borrow on a secured basis and incorporates the term and economic environment of the associated lease.
For the Company’s operating leases, fixed lease payments are recognized as lease expense on a straight-line basis over the lease term. For leases with a term of 12 months or less, lease payments are recognized as paid and are not recognized on the Company’s consolidated balance sheet as an accounting policy election. Leases qualifying for the short-term lease exception were insignificant. Variable lease costs are recognized as incurred and primarily consist of common area maintenance and utility charges not included in the measurement of right of use assets and operating lease liabilities.
Income Taxes
The Company accounts for income taxes under the asset and liability method, in which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is required to the extent any deferred tax assets may not be realizable.
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Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public business entities to provide additional disclosures about certain expenses included in the income statement. The amendments require entities to disclose, in the notes to the financial statements, specified information about certain costs and expenses, including purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion, when such amounts are included in relevant expense captions. The amendments are effective for annual reporting periods beginning after December 15, 2026, and for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2024-03 on its financial statement disclosures.
In November 2024, the FASB also issued Accounting Standards Update 2024-04 “Debt - Debt with Conversion and Other Options (Subtopic 470-20) “Induced Conversions of Convertible Debt Instruments” to clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. Under the amendments, to account for a settlement of a convertible debt instrument as an induced conversion, an inducement offer is required to provide the debt holder with, at a minimum, the consideration (in form and amount) issuable under the conversion privileges provided in the terms of the instrument. An entity should assess whether this criterion is satisfied as of the date the inducement offer is accepted by the holder. If, when applying this criterion, the convertible debt instrument had been exchanged or modified (without being deemed substantially different) within the one-year period leading up to the offer acceptance date, an entity should compare the terms provided in the inducement offer with the terms that existed one year before the offer acceptance date. The amendments in this Update also clarify that the induced conversion guidance applies to a convertible debt instrument that is not currently convertible as long as it had a substantive conversion feature as of both its issuance date and the date the inducement offer is accepted. The amendments are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company is examining the impact this pronouncement may have on it consolidated financial statements.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position, results of operations or cash flows.
NOTE 3 – LIQUIDITY AND CAPITAL RESOURCES
The Company’s unaudited consolidated financial statements have been prepared in accordance with U.S. GAAP. In accordance with ASC 205-40, Presentation of Financial Statements—Going Concern, management has evaluated whether conditions or events, considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern for the one-year period following the date these unaudited consolidated financial statements are issued.
As of June 30, 2026, the Company had cash of approximately
$
In addition, the Company is in the process of spinning off DMINT into a stand-alone entity, which is expected to occur during the next twelve months. Following the spin-off, the Company will no longer be responsible for the capital requirements associated with operating the Bitcoin Mining Segment. DMINT, as a stand-alone entity, intends to seek additional capital, as necessary, through equity financings or borrowings secured by its assets, which include the property located in Selmer, Tennessee and its Bitcoin mining computers.
Based on management’s evaluation of the Company’s existing liquidity, recent capital-raising activities, expected cash requirements, and other relevant conditions and events, management concluded that the Company has sufficient liquidity to meet its obligations as they become due for at least one year from the date these unaudited consolidated financial statements are issued. Accordingly, management concluded that substantial doubt about the Company’s ability to continue as a going concern does not exist.
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The Company has reviewed its cash flow activity during the six months ended June 30, 2026 and projected cash flow forecast for remainder of 2026 and performed an overall analysis of market trends to determine whether or not it has sufficient liquidity to continue as a going concern for a period of at least twelve months from the date of this Quarterly Report. Based on projected cash to be used in operations to be offset by expected proceeds from the ATM program and loan proceeds from Ronny Yakov under the loan agreement, the Company believes it has sufficient liquidity in order to sustain operations for at least the twelve months following the filing of this Quarterly Report. However, management recognizes that it may be required to obtain additional resources to successfully execute its business plans. No assurances can be given that management will be successful in raising additional capital, if needed, or on acceptable terms. Management believes that the Company’s existing cash resources, together with the ATM, related party financing, and other available funding sources, will be sufficient to support operations through August 14, 2027. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.
NOTE 4 – PROPERTY AND EQUIPMENT
Property and equipment consisted of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| Office equipment | $ | $ | ||||||
| Computer software | ||||||||
| Bitcoin mining equipment | ||||||||
| Building | ||||||||
| Construction in process | ||||||||
| Total | ||||||||
| Less accumulated depreciation | ( | ) | ( | ) | ||||
| Property and Equipment, net | $ | $ | ||||||
Depreciation expense for the three and six months
ended June 30, 2026 was $
Depreciation expense for the three and six months ended June 30,
2025 was $
NOTE 5 – 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, $
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NOTE 6 – STOCK OPTIONS
A summary of the status of the Company’s outstanding stock options and changes is presented below:
| Stock Options | Options | Weighted Average Exercise Price | Aggregate Intrinsic Value | |||||||||
| Options outstanding December 31, 2024 | $ | $ | ||||||||||
| Granted | ||||||||||||
| Exercised | ||||||||||||
| Expired | ||||||||||||
| Options outstanding December 31, 2025 | $ | $ | ||||||||||
| Granted | ||||||||||||
| Exercised | ||||||||||||
| Expired | ||||||||||||
| Options outstanding June 30, 2026 | $ | $ | ||||||||||
| Shares exercisable at June 30, 2026 | $ | $ | ||||||||||
During the six months ended June 30, 2026 and 2025, the Company
recognized $
NOTE 7 – WARRANTS
On
January 22, 2026, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with certain institutional
investors (the “Purchasers”) pursuant to which the Company agreed to sell and issue, in a registered direct offering, an
aggregate of
The
aggregate fair value of the
On February 18, 2026, the Company entered into
a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Purchaser”) pursuant
to which the Company agreed to sell and issue, in a private placement offering, (i) pre-funded warrants to purchase up to
The
Pre-Funded Warrants are immediately exercisable, will expire upon exercise in full of all Pre-Funded Warrants and have an exercise price
of $
The
aggregate fair value of the
Upon the consummation of the February 18, 2026 Offering, the exercise
price of
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A summary of the status of the Company’s outstanding warrants and changes during the periods is presented below:
| Number of Warrants | Weighted Average Exercise Price | Weighted Average Remaining Contract Term | ||||||||||
| Outstanding, December 31, 2024 | $ | |||||||||||
| Warrants Expired | ( | ) | $ | |||||||||
| Outstanding, December 31, 2025 | $ | |||||||||||
| Warrants Issued | ||||||||||||
| Warrants Exercised | ( | ) | — | |||||||||
| Outstanding, June 30, 2026 | $ | |||||||||||
NOTE 8 – OPERATING LEASE
On
November 13, 2024, eVance entered into a Lease Agreement (the “Lease”) with Royal Centre Holdings LLC (the “Lessor”)
relating to approximately
Operating lease expense for the six months ended
June 30, 2026 and 2025, was $
NOTE 9 – STOCKHOLDERS’ EQUITY
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,
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
On
January 21, 2026, the Company issued
On
January 21, 2026, the Company issued
During
the six months ended June 30, 2026,
Refer to Note 11 for common stock issued to related parties.
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NOTE 10 – PREFERRED STOCK
On
August 7, 2020, we filed a Certificate of Designations, Preferences and Rights of Series A Preferred Stock (the “Certificate of
Designations”) with the Secretary of State of Delaware. The Certificate of Designations will provide that the Company may
issue up to
As
of June 30, 2026 and December 31, 2025, there were
Dividends
The
Series A Preferred Stockholders are entitled to receive cash dividends at a rate per share (as a percentage of the Stated Value per share)
of
Conversion
The Series A Preferred Stockholders may convert, at their option, on or after the date on which the Term Loan is repaid in full, each share of Series A Preferred Stock (along with accrued but unpaid dividends thereon) into such number of shares of common stock as determined by dividing the Stated Value by the conversion price. The conversion price for the Series A Preferred Stock will be equal to the offering price per Unit in this offering and will be subject to adjustment for splits and the like. The holders of Series A Preferred Stock will only be permitted to convert their shares of Series A Preferred Stock into shares of common stock at such time as the Term Loan has been repaid in full and there are no further outstanding obligations regarding such indebtedness.
Voting
Each holder of a share of Series A Preferred Stock will have the right to vote its shares of Series A Preferred Stock with the common stock on an as-converted basis, and with respect to such votes, such holder shall have full voting rights and powers equal to the voting rights and powers of the holders of common stock, and shall be entitled, to notice of any stockholders’ meeting in accordance with the Company’s bylaws, and shall be entitled to vote, together with holders of common stock, with respect to any question upon which holders of common stock have the right to vote. Fractional votes shall not be permitted, and such shares shall be rounded up.
Liquidation Preference
Each share of Series A Preferred Stock will have a liquidation preference equal to the Stated Value plus any accrued but unpaid dividends thereon. In the event of a liquidation, dissolution or winding up of the Company (which includes any merger, reorganization, sale of assets in which control of the Company is transferred or event which results in all or substantially all of the Company’s assets being transferred), the holders of Series A Preferred Stock shall be entitled to receive out of the assets of the Company, before any payment is made to the holders of the Company’s common stock and either in preference to or pari pasu with the holders of any other series of preferred stock that may be issued in the future, a per share amount equal to the liquidation preference.
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NOTE 11 – RELATED PARTY TRANSACTIONS
On
August 12, 2024, the Company entered into an agreement with Yakov Holdings, LLC, an entity controlled by Mr. Yakov whereby Yakov Holdings,
LLC committed to loan to the Company up to Five Million Dollars ($
On October 14, 2025, the Company’s Board of Directors approved, and on November 14, 2025 the Company entered into, an amended and restated employment agreement (the “Employment Agreement”) with its Chairman, President and Chief Executive Officer, Ronny Yakov (the “Executive”). The Employment Agreement supersedes the prior agreement dated January 3, 2022 and has an initial term through December 31, 2030, with automatic one-year renewals thereafter unless terminated in accordance with its terms.
Effective May 15, 2026, the Company entered into
an amended and restated employment agreement with Mr. Yakov, which supersedes his prior employment agreement and extends through December
31, 2030, with automatic one-year renewals thereafter. The agreement provides for an annual base salary of $
During
the three months ended March 31, 2026, the Company granted
During
the three months ended June 30, 2026, the Company granted
NOTE 12 – 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 $
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DMINT
is currently in a contract dispute with a contractor. The Company has paid $
Company
management has recognized a liability for the $
NOTE 13 – INCOME TAX
The Company accounts for income taxes in accordance with ASC 740, Income Taxes. For , adjusted for discrete items occurring during the period.
For
the six months ended June 30, 2026 and 2025, the Company recorded
The Company maintains a full valuation allowance against its deferred tax assets, which consist primarily of net operating loss carryforwards and other temporary differences, because management believes it is more likely than not that the deferred tax assets will not be realized. Management evaluates the realizability of deferred tax assets each reporting period based on available evidence, including cumulative losses, projected future taxable income, and tax-planning strategies. There were no material changes to the Company’s deferred tax assets or valuation allowance during the six months ended June 30, 2026.
The Company’s net operating loss carryforwards may be subject to limitation under Section 382 of the Internal Revenue Code in the event of an ownership change. The Company has not recorded any liability for uncertain tax positions and is not currently under examination by taxing authorities.
NOTE 14 – SEGMENTS
The Company accounts for its reportable segments
in accordance with ASC 280, Segment Reporting. The Company has identified
The Company’s CODM consists of its Chief Executive Officer and Vice President. The CODM regularly reviews the financial results of each reportable segment, including revenues and expenses, to assess segment performance, evaluate operating results, and make decisions regarding the allocation of resources. The Company’s segment disclosures reflect the financial information and measures regularly provided to and reviewed by the CODM.
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The following is the balance sheet for the Company’s reportable segments for as of June 30, 2026.
| Fintech Segment |
Bitcoin Mining Segment |
Consolidated Total |
||||||||||
| ASSETS | ||||||||||||
| Current Assets: | ||||||||||||
| Cash | $ | $ | $ | |||||||||
| Prepaid expenses | ||||||||||||
| Accounts receivable | ( |
) | ||||||||||
| Other receivables | ||||||||||||
| Other current assets | ||||||||||||
| Total Current Assets | ||||||||||||
| Other Assets: | ||||||||||||
| Property and equipment, net | ||||||||||||
| Goodwill | ||||||||||||
| Other long-term assets | ||||||||||||
| Total Other Assets | ||||||||||||
| TOTAL ASSETS | $ | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
| Current Liabilities: | ||||||||||||
| Cash overdraft | $ | $ | $ | |||||||||
| Accounts payable | ||||||||||||
| Accrued expenses | ||||||||||||
| Merchant portfolio purchase installment obligation | ||||||||||||
| Related party payable | ||||||||||||
| Accrued interest – related party | ||||||||||||
| Note payable – current portion | ||||||||||||
| Due to/from intercompany | ( |
) | ||||||||||
| Total Current Liabilities | ( |
) | ||||||||||
| Total Liabilities | ( |
) | ||||||||||
| Stockholders’ Equity: | ||||||||||||
| Series A Preferred stock | ||||||||||||
| Common stock | ||||||||||||
| Treasury stock | ( |
) | ( |
) | ||||||||
| Additional paid-in capital | ||||||||||||
| Accumulated deficit | ( |
) | ( |
) | ( |
) | ||||||
| Total stockholders’ equity (deficit) | ( |
) | ||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | $ | $ | |||||||||
The following tables detail revenue and operating expenses for the Company’s reportable segments for the six months ended June 30, 2026.
| Fintech Segment | Bitcoin Mining Segment | Consolidated Total | ||||||||||
| Revenue: | ||||||||||||
| Transaction and processing fees | $ | $ | $ | |||||||||
| Revenue, net - bitcoin mining | ||||||||||||
| Other revenue from monthly recurring subscriptions | ||||||||||||
| Digital product revenue | ||||||||||||
| Total revenue | ||||||||||||
| Operating expenses: | ||||||||||||
| Processing and servicing costs | ||||||||||||
| Depreciation expense | ||||||||||||
| Salaries and wages | ||||||||||||
| Professional fees | ||||||||||||
| General and administrative expenses | ||||||||||||
| Total operating expenses | ||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ||||||
| Other income (expense): | ||||||||||||
| Unrealized loss of cryptocurrency | ( | ) | ( | ) | ||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ||||||
| Gain on settlement of accounts payable | ||||||||||||
| Total other income | ( | ) | ||||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ||||||
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The following is the balance sheet for the Company’s reportable segments for the year ended December 31, 2025.
| Fintech Segment | Bitcoin Mining Segment | Consolidated Total | ||||||||||
| ASSETS | ||||||||||||
| Current Assets: | ||||||||||||
| Cash | $ | $ | $ | |||||||||
| Accounts receivable, net | ||||||||||||
| Prepaid expenses | ||||||||||||
| Other receivables | ||||||||||||
| Other current assets | ||||||||||||
| Total Current Assets | ||||||||||||
| Other Assets: | ||||||||||||
| Property and equipment, net | ||||||||||||
| Goodwill | ||||||||||||
| Other long-term assets | ||||||||||||
| Total Other Assets | ||||||||||||
| TOTAL ASSETS | $ | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
| Current Liabilities: | ||||||||||||
| Cash overdraft | $ | $ | $ | |||||||||
| Accounts payable | ||||||||||||
| Accrued expenses | ||||||||||||
| Merchant portfolio purchase installment obligation | ||||||||||||
| Related party payable | ||||||||||||
| Note payable – current portion | ||||||||||||
| Due to/from intercompany | ( | ) | ||||||||||
| Total Current Liabilities | ( | ) | ||||||||||
| Total Liabilities | ( | ) | ||||||||||
| Stockholders’ Equity: | ||||||||||||
| Series A Preferred stock | ||||||||||||
| Common stock | ||||||||||||
| Treasury stock | ( | ) | ( | ) | ||||||||
| Additional paid-in capital | ||||||||||||
| Accumulated deficit | ( | ) | ( | ) | ( | ) | ||||||
| Total stockholders’ equity (deficit) | ( | ) | ||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | $ | $ | |||||||||
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The following tables detail revenue and operating expenses for the Company’s reportable segments for the six months ended June 30, 2025.
| Fintech Segment | Bitcoin Mining Segment | Consolidated Total | ||||||||||
| Revenue: | ||||||||||||
| Transaction and processing fees | $ | $ | $ | |||||||||
| Merchant equipment rental and sales | ||||||||||||
| Revenue, net - bitcoin mining | ||||||||||||
| Other revenue from monthly recurring subscriptions | ||||||||||||
| Digital product revenue | ||||||||||||
| Total revenue | ||||||||||||
| Operating expenses: | ||||||||||||
| Processing and servicing costs, excluding merchant portfolio amortization | ||||||||||||
| Amortization expense | ||||||||||||
| Depreciation expense | ||||||||||||
| Salaries and wages | ||||||||||||
| Professional fees | ||||||||||||
| General and administrative expenses | ||||||||||||
| Total operating expenses | ||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ||||||
| Other income (expense): | ||||||||||||
| Interest expense | ( | ) | ( | ) | ||||||||
| Loss on conversion related party | ( | ) | ( | ) | ||||||||
| Loss on extinguishment of debt | ( | ) | ( | ) | ||||||||
| Other expense | ( | ) | ( | ) | ||||||||
| Total other income | ( | ) | ( | ) | ||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ||||||
| Deemed Preferred dividends (related party) | ( | ) | ( | ) | ||||||||
| Preferred dividends (related party) | ( | ) | ( | ) | ||||||||
| Net Loss Applicable to Common Stockholders’ | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
NOTE 15 – MERCHANT PORTFOLIO PURCHASE INSTALLMENT OBLIGATION
On
November 24, 2021, we entered into an Asset Purchase Agreement (the “Agreement”) dated as of November 15, 2021 with FFS Data
Corporation (“Seller”) whereby we acquired a portfolio of merchants utilizing financial transaction processing services (the
“Acquired Merchant Portfolio”). The purchase price was $
NOTE 16 – SUBSEQUENT EVENTS
In accordance with ASC 855 management has performed an evaluation of subsequent events through the date that the unaudited financial statements were issued and has determined that it has the following material subsequent events to disclose in these unaudited financial statements.
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
On August 7, 2026, the Company issued
All shares of common stock issued pursuant to these transactions were issued in reliance upon Section 4(a)(2) of the Securities Act and are restricted securities under Rule 144.
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Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
The information in this report contains forward-looking statements. All statements other than statements of historical fact made in this report are forward-looking. In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking statements. These forward-looking statements can be identified by the use of words such as “believes,” “estimates,” “could,” “possibly,” “probably,” anticipates,” “projects,” “expects,” “may,” “will,” or “should” or other variations or similar words. No assurances can be given that the future results anticipated by the forward-looking statements will be achieved. Forward-looking statements reflect management’s current expectations and are inherently uncertain. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, our actual results may differ significantly from management’s expectations. These risks and uncertainties include those factors described in greater detail in the risk factors disclosed in our Form 10-K for the fiscal year ended December 31, 2025 filed with the Securities and Exchange Commission. Our forward-looking statements include, among others, statements regarding our deployment of artificial intelligence and agentic AI across our applications and operating functions, the expansion of our engineering team and our adoption of “Agentic Coding” methodologies, the anticipated benefits, costs and timing of those initiatives, the anticipated timing and completion of the DMINT spin-off, the sufficiency of our capital resources and our ability to raise additional capital. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those anticipated in these forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q or, in the case of documents referred to or incorporated by reference, the date of those documents.
The following discussion and analysis should be read in conjunction with our unaudited financial statements, included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of our management.
Company Overview and Description of Business
Overview
We are a FinTech company that focuses on a suite of products in the merchant services marketplace that seeks to provide integrated business solutions to merchants throughout the United States. We seek to accomplish this by providing merchants with a wide range of products and services through our various online platforms, including financial and transaction processing services. We also have products that provide support for crowdfunding and other capital-raising initiatives. We supplement our online platforms with certain hardware solutions that are integrated with our online platforms. We generate revenue through two business segments, Fintech Services and Bitcoin Mining. Our business functions through our wholly-owned subsidiaries, eVance, Inc., a Delaware corporation (“eVance”), OmniSoft.io, Inc., a Delaware corporation (“OmniSoft”), CrowdPay.Us, Inc., a New York corporation (“CrowdPay”), Crowd Ignition, Inc. (“Crowd Ignition”), OLBit, Inc. (“OLBit”), Moola Cloud, LLC (“Moola Cloud”) and DMINT, Inc. (“DMINT”), though substantially all of our revenue has been generated from our eVance business. We expect to build out our OmniSoft software business and to rely more on individualized merchant services offerings for revenue so that we are not dependent on our revenue from our eVance business but there is no guarantee that we will be able to do so.
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Our Fintech Services span credit and debit card acceptance, ACH payments, real-time payments, digital wallets, PayPal integration and payment terminal and hardware rentals, and are delivered principally through SecurePay™, our proprietary payment gateway, through which card, ACH and real-time payment transactions are routed and authorized and which supports 3-D Secure authentication on card-not-present transactions. We market our AI-enabled merchant applications under the iStores AI and ShopFast AI brands. We also provide eCommerce development and consulting services on a project-by-project basis, including custom artificial intelligence-based development projects for merchants and other clients that are related to transaction processing and other transaction-driven activities.
We have integrated all the applications for OmniSoft and the ShopFast Omnicommerce solution with the eVance mobile payment gateway, SecurePay.comTM.. In July 2019, we launched a new merchant and ISO boarding system that will be able to onboard merchants instantly. This provides the merchant with an automated approval and ISOs will have the ability to see all their merchants and their residuals as they load to the system.
On May 22, 2020, the Company purchased certain assets from POSaBIT Inc. (“POSaBIT”), including its contracts and arrangements with the Doublebeam merchant payment processing platform (the “POSaBIT Asset Acquisition”). The assets included, but were not limited to, software source codes, customer lists, customer contracts, hardware and website domains.
On May 14, 2021, the Company formed OLBit, Inc., a wholly owned subsidiary (“OLBit”). The purpose of OLBit is to hold the Company’s assets and operate its business related to its emerging money transmission and transactional business. OLBit was previously in the process of applying for money transmission licenses in all 50 states. In June 2023, it was decided to delay the process of applying for such licenses in order to have a greater focus of financial and management resources on the Company’s payment processing business and Bitcoin mining business. The Company has since resumed that process and is preparing and submitting money transmission license applications in the states in which it intends to conduct OLBit’s lending and transactional business, while continuing to plan the scope and sequencing of those filings. Issuance of these licenses is subject to review and approval by state regulators, and there is no assurance that the Company will obtain any such license, or that it will do so on the timeline it currently anticipates.
On July 23, 2021, we formed DMINT, Inc., a wholly owned subsidiary (“DMINT”) to operate in the Bitcoin mining industry, specifically the mining of Bitcoin. DMINT initiated the first phase of the Bitcoin mining operation by placing data centers and ASIC-based Antminer S19J Pro mining computers specifically configured to mine Bitcoin in Pennsylvania. As of December 31, 2022, DMINT had purchased 1,000 computers. DMINT has a data center located in Selmer, Tennessee. In February 2023, DMINT redeployed its mining computers from its Pennsylvania location and focused the mining efforts at the Selmer, Tennessee location because of the lower cost of operations in the location. As of December 31, 2025, DMINT had 1,000 computers and had 400 computers online and mining for Bitcoin. At June 30, 2026, DMINT had mined 61.73 Bitcoin. On October 21, 2024, DMINT filed a Registration Statement on Form S-1 with the Securities and Exchange Commission (the “SEC”), relating to the proposed spinoff from the Company and resulting issuance of equity of DMINT to OLB shareholders.
On August 16, 2022, DMINT Real Estate Holdings, Inc. (“DREH”), a wholly owned subsidiary of DMINT, purchased 4.73 acres of land and a building located at 565 Industrial Park Drive, Selmer, McNairy County, Tennessee for a purchase price of $408,000. DMINT established a Bitcoin mining data center powered on the local power grid. The location is expected to have capacity for up to 5,000 mining machines. The Company plans to complete the buildout of the building to be fully operational with 5,000 machines in 2027 following a spin-off of DMINT into a standalone entity, which is currently in process and has not yet been consummated.
As stated above, we are currently in the process of spinning off DMINT into a stand-alone entity. Our planned DMINT spin-off distribution (the “Spin-Off Distribution”) will occur upon DMINT’s Form S-1 Registration Statement filing being declared effective by the Securities and Exchange Commission, and the approval by the Nasdaq Capital Market (“NASDAQ”) of the listing of DMINT’s common shares on the NASDAQ. Following the consummation of the Spin-Off Distribution, of which there is no guarantee, (i) DMINT will no longer be a wholly owned subsidiary of the Company and will be a stand-alone entity, (ii) all of DMINT’s outstanding shares of common stock will be owned by the existing stockholders of the Company, and (iii) DMINT Real Estate Holdings, Inc. (“DREH”) will remain a wholly owned subsidiary of DMINT
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CrowdPay.us™ operates a white label capital raising platform that targets small and midsized businesses seeking to raise capital and registered broker-dealers seeking to host capital raising campaigns for such businesses by integrating the platform onto such company’s or broker-dealer’s website. Our CrowdPay platform is tailored for companies seeking to raise money through a crowdfunding offering of between $1 million and $50 million pursuant to Regulation CF under Title III of the Jumpstart Our Business Startups (the “JOBS Act”), offerings pursuant to Rule 506(b) and Rule 506(c) under Regulation D of the Securities Act of 1933, as amended (the “Securities Act”), and offerings pursuant to Regulation A+ of the Securities Act. Our platform, which can be used for multiple offerings at once, provides companies and broker-dealers with an easy-to-use, turnkey solution to support company offerings, allowing companies and broker-dealers to easily present online to potential investors relevant marketing and offering materials and by aiding in the accreditation and background check processes to ensure investors meets the applicable requirements under the rules and regulations of the Securities Exchange Commission (the “SEC”). CrowdPay charges a fee to each company and broker-dealer for the use of its platform under a fee structure that is agreed to between CrowdPay and the Company and/or broker-dealer prior to the initiation of the offering. CrowdPay also generates revenues by providing ancillary services to the companies and broker-dealers utilizing our platform, including running background checks and providing anti-money laundering and know-your-customer compliance. CrowdPay is not a registered funding portal or a registered broker-dealer.
On January 3, 2022, the Company entered into a share exchange agreement with all of the shareholders of Crowd Ignition, Inc. (“Crowd Ignition”) whereby the Company purchased 100% of the equity of Crowd Ignition in exchange for 1,318,408 shares of the common stock, par value $0.0001 of the Company (the “CI Issued Shares”). The value of the CI Issued Shares was, for purposes of the Agreement, based on the closing trading price of the Company on October 1, 2021 (the date on which a third-party fairness opinion was issued), resulting in an aggregate purchase price for Crowd Ignition of $5.3 million. The share exchange transaction closed on January 3, 2022. Prior to the closing of the share exchange transaction, Ronny Yakov, Chairman and CEO of the Company and John Herzog, a shareholder of the Company, owned 100% of the equity of Crowd Ignition.
Crowd Ignition is a web-based crowdfunding software system. The software provides broker-dealer, merchant banks and law firms a platform to market crowdfunding offerings, collect payments and issue securities. The software has been developed in response to, and to comply with, recent changes in investment regulations including Regulation D 506(b) and 506(v), Regulation A+ and Title III of the Jobs Act (Regulation CF), including raising the crowdfunding limit from $1.07 million to $5.0 million. Crowd Ignition is one of only about 50 companies registered with the SEC to provide the services permitted under Regulation CF.
On June 15, 2023, the Company entered into a Membership Interest Purchase Agreement (the “Agreement”) with SDI Black 001, LLC (“Seller”) whereby it acquired 80.01% of the membership interests of Moola Cloud, LLC, a Florida limited liability company (formerly Cuentas SDI, LLC, the “LLC”). The LLC will enable the Company to focus on marketing to the underbanked communities utilizing the LLC’s debit and calling card platform’s ability for users to reload cash to their account and provide instant access to digital products to their customers’ Mobile App and digital wallet into its electronic portal. The Company plans to market to the LLC’s merchant network, which currently includes approximately 31,600 bodega convenience stores in and around New York and New Jersey, the ability of having one POS system that will allow the retail customer to purchase products using OLB’s payment processing solutions along with the ability to reload payment cards and their mobile phone minutes. On May 20, 2024, the Company entered into a Membership Interest Purchase Agreement (the “Agreement”) dated as of May 20, 2024 with the minority member of the LLC whereby it acquired the remaining 19.99% of the membership interests of the LLC for a purchase price of $215,500. As a result, effective May 20, 2024, the Company owns 100% of the LLC. On August 14, 2024, the LLC changed its name to Moola Cloud, LLC. The Agreement contains a restrictive covenant whereby for a period of three (3) years from the closing, none of Seller, including its any of its principals, executives, officers, directors, managers, employees, salespersons, or entities in which such principal has any interest, will directly or indirectly (i) induce, attempt to induce, interfere with, disrupt or attempt to disrupt any past, present or prospective business relationship, solicit, market to, endeavor to obtain as a customer, or contract with any merchant in order to provide services to such Merchant in competition with the Company; or (ii) solicit or interfere with, disrupt or attempt to disrupt any past, present or prospective business relationship, contractual or otherwise any person or entity that is a party to any contract assigned to the Company to terminate its contractual or business relationship with the Company.
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Artificial Intelligence and Agentic AI Initiatives
During the six months ended June 30, 2026 and continuing through the date of this Quarterly Report, we have been re-engineering our operations around artificial intelligence (“AI”), including agentic AI — autonomous software agents that are designed to plan, decide and execute tasks with limited human intervention. Our objective is to operate as an AI-native financial technology company. Our AI strategy is organized around three principal initiatives, each of which is described below, and includes the implementation of agentic commerce and automation services across our Fintech Services platforms. These initiatives are in varying stages of design, development and implementation, and there is no assurance that any of them will be completed on the timelines we currently anticipate, or at all, or that they will produce the operational or financial benefits we expect.
AI Embedded in Our Applications. We are working to add AI capabilities to our customer-facing and internal applications, including our SecurePay™ payment gateway, our ShopFast AI eCommerce platform, iStores AI and the Moola Cloud merchant network. The capabilities we are developing or evaluating include real-time fraud detection, intelligent transaction routing, automated chargeback management, dynamic risk scoring and conversational AI interfaces for merchants and consumers. We are also developing an application that will enable issuers using our CrowdPay platform to generate tokenized offerings, provide investors with additional payment options and access live AI chatbot support, for which we expect to release an initial update during the fourth quarter of 2026 and to complete a full launch in early 2027, including support for stablecoin payment options provided through licensed or otherwise authorized third-party providers; a new point-of-sale solution for the Moola Cloud merchant network that will combine payment acceptance with a self-service website builder, enabling merchants to create and maintain their own eCommerce storefronts alongside their in-store operations, and that has been upgraded with our recent services and is ready for implementation at merchant locations; and custom AI-based development projects for merchants and other clients that are related to transaction processing and other transaction-driven activities. Certain of these capabilities remain in development and have not yet been deployed to merchants. See Note 1 to our condensed consolidated financial statements and Item 1A, “Risk Factors.”
Agentic AI Across Operating Functions. We are deploying, or intend to deploy, agentic AI across our operating functions. In customer support, we are using AI agents to assist with merchant onboarding inquiries, ticket triage, transaction disputes and first-line support, with escalation of exceptions to our personnel. In risk and compliance, we are using AI agents to monitor merchant transaction patterns, merchant category code classification, MATCH list exposure and know-your-customer and anti-money laundering signals in order to surface anomalies for review. In underwriting and merchant boarding, we are developing AI-driven boarding workflows intended to support same-day merchant approval through SecurePay, including background checks, sanctions screening and PCI compliance verification. In accounting and finance, we are developing AI agents intended to automate invoice processing, reconciliation, residual calculations, expense categorization and routine financial close activities. In sales and independent sales organization (“ISO”) operations, we are developing AI assistants intended to help ISOs track merchant residuals, model pricing scenarios and identify potential upsell opportunities. Human review and oversight remain in place for underwriting, risk, compliance and financial reporting activities, and our internal control over financial reporting is not dependent on these tools.
Expanded Engineering Team and “Agentic Coding.” Beginning in 2026, we transitioned our entire software development team to an artificial intelligence-assisted model for developing and maintaining our applications, commonly referred to as “Agentic Coding” or “vibe coding,” a software development methodology in which engineers direct and review code generated by large language model tools rather than authoring code directly. The transition applies across both of our business segments. We are also adding engineering personnel focused on agentic AI development, and we are training our existing developers to work in this manner, with AI coding agents supporting scaffolding, refactoring, testing and documentation, and we are recruiting new engineers based in part on their ability to build and orchestrate agentic AI systems. We expect that these methods may compress development cycles, reduce engineering cost per feature delivered and accelerate our ability to deliver merchant-specific solutions, although we have limited operating history with these methods and cannot assure you that these expected benefits will be realized.
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Our AI initiatives are in the early stages of implementation and did not have a material effect on our results of operations for the six months ended June 30, 2026. Costs incurred in connection with these initiatives to date have consisted primarily of personnel and third-party software and services costs and are included within salaries and wages and general and administrative expenses in our condensed consolidated statements of operations. We expect these costs to increase as we hire additional engineering personnel and expand our use of third-party AI models and tools. To date, we have not recognized revenue that is separately attributable to these initiatives.
The use of AI and agentic AI in a regulated payments business presents risks, including the risk of inaccurate or unreliable model outputs, algorithmic bias, data privacy and data security exposure, dependence on third-party model providers, and evolving federal and state regulation and card network rules governing the use of automated decision-making in underwriting, risk and compliance functions. Any failure of these systems, or any determination by a regulator, card network or sponsor bank that our use of them is non-compliant, could require us to modify or discontinue these initiatives and could adversely affect our business, results of operations and financial condition.
Results of Operations
Management’s discussion and analysis of financial condition and results of operations (“MD&A”) includes a discussion of the consolidated results from operations of The OLB Group, Inc. and its subsidiaries for the three and six months ended June 30, 2026.
Three Months Ended June 30, 2026 Compared to the Three Months Ended June 30, 2025
For the three months ended June 30, 2026, we had total revenue of $1,279,251 compared to $2,267,191 of revenue for the three months ended June 30, 2025, a decrease of $987,940 or 43.6%. In the current period we earned $1,169,910 in transaction and processing fees, $22,791 in other revenue from monthly recurring subscriptions, $73,241 of revenue from the Cryptocurrency Mining segment and $13,309 of revenue from the sale of digital products. For the three months ended June 30, 2025, we earned $2,096,342 in transaction and processing fees, $4,563 in merchant equipment rental and sales, $70,359 in other revenue from monthly recurring subscriptions, $60,190 of revenue from the Cryptocurrency Mining segment and $35,737 of revenue from the sale of digital products. We had a decrease in revenue primarily due to a decrease in revenue related to Moola Cloud, LLC, as the Company transitions to new vendors to obtain better pricing and is working to acquire new vendors to replace others that have gone out of business. In addition, we had a decrease of revenue from the Cryptocurrency Mining, due to the decline in the value of Bitcoin.
For the three months ended June 30, 2026, we had processing and servicing costs of $1,063,595 compared to $1,964,314 of processing and servicing costs for the three months ended June 30, 2025, a decrease of $900,719 or 45.9%. Processing and servicing costs decreased in conjunction with the decreased revenue and merchant attrition.
Amortization and depreciation expense for the three months ended June 30, 2026 was $3,412 compared to $0 for the three months ended June 30, 2025, an increase of $3,412. We recorded amortization expense on our merchant portfolio, trademarks and natural gas purchase rights. The decrease in the current period is due to most of the assets being fully amortized in 2024 and the remainder in Q1 2025.
Depreciation expense for our Bitcoin Mining Segment was $0 for the three months ended June 30, 2026, compared to $120,967, for the three months ended June 30, 2025, a decrease of $120,967. The decrease in the current period is due to assets being impaired and/or fully depreciated in prior periods.
Salary and wage expense for the three months ended June 30, 2026, was $812,600 compared to $1,052,614 for the three months ended June 30, 2025, a decrease of $240,014 or 22.8%. In the current period, we granted shares of common stock to our CEO for total non-cash expense of $96,200 in accordance with his new employment agreement. This increase to wage expense was offset with fewer employees, and therefore lower wage expense in 2026. The decrease in employees will not have an effect on future earnings. If the Company feels the employees/positions need to be replaced, then the Company will hire for the position.
Professional fees for the three months ended June 30, 2026, were $126,264 compared to $334,566 for the three months ended June 30, 2025, a decrease of $208,302 or 62.3%. Professional fees consist mainly of audit and legal fees. The decrease in the current period is due to a decrease in legal fees.
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General and administrative expenses for the three months ended June 30, 2026, was $533,248 compared to $491,476 for the three months ended June 30, 2025, an increase of $41,772 or 8.5%. The increase was mainly due to an increase of utility expense and insurance expense.
For the three months ended June 30, 2026, the Company recognized total other income of $205,062, consisting of $75,902 of interest expense and an unrealized loss in the fair value of cryptocurrency of $20,648. This was offset by a $301,612 gain on the settlement of accounts payable through the issuance of common stock. For the three months ended June 30, 2025, we had total other expenses of $427,568. We incurred interest expense for related parties of $169,805 and other expense of $30,000. We also recognized a loss on the extinguishment of debt of $52,000 and a loss on conversion of accrued salaries and loans payable of $175,763.
Our net loss for the three months ended June 30, 2026, was $1,054,806 compared to $2,124,314 for the three months ended June 30, 2025. This was a decrease in our net loss of $1,069,508.
Six Months Ended June 30, 2026 Compared to the Six Months Ended June 30, 2025
For the six months ended June 30, 2026, we had total revenue of $2,935,595 compared to $4,588,727 of revenue for the six months ended June 30, 2025, a decrease of $1,653,132 or 36%. In the current period we earned $2,687,681 in transaction and processing fees, $48,727 in other revenue from monthly recurring subscriptions, $121,461 of revenue from the Cryptocurrency Mining segment and $77,726 of revenue from the sale of digital products. For the six months ended June 30, 2025, we earned $4,154,619 in transaction and processing fees, $16,687 in merchant equipment rental and sales, $142,996 in other revenue from monthly recurring subscriptions, $145,672 of revenue from the Cryptocurrency Mining segment and $128,753 of revenue from the sale of digital products. We had a decrease in revenue primarily due to a decrease in revenue related to Moola Cloud, LLC, as the Company transitions to new vendors to obtain better pricing and is working to acquire new vendors to replace others that have gone out of business. In addition, we had a decrease of revenue from the Cryptocurrency Mining, due to the decline in the value of Bitcoin.
For the six months ended June 30, 2026, we had processing and servicing costs of $2,544,846 compared to $3,773,128 of processing and servicing costs for the six months ended June 30, 2025, a decrease of $1,228,282 or 32.6%. Processing and servicing costs decreased in conjunction with the decreased revenue and merchant attrition.
Amortization and depreciation expense for the six months ended June 30, 2026 was $6,822 compared to $3,972 for the six months ended June 30, 2025, an increase of $2,850. We recorded amortization expense on our merchant portfolio, trademarks and natural gas purchase rights. The increase in the current period is due to all of those assets being fully amortized in 2024 and the remainder in Q1 2025.
Depreciation expense for our Bitcoin Mining Segment was $0 for the six months ended June 30, 2026, compared to $379,316, for the six months ended June 30, 2025, a decrease of $379,316. The decrease in the current period is due to assets being impaired and/or fully depreciated in prior periods.
Salary and wage expense for the six months ended June 30, 2026, was $1,482,037 compared to $1,583,970 for the six months ended June 30, 2025, a decrease of $101,933 or 6.4%. In the current period, we granted shares of common stock to our CEO for total non-cash expense of $226,320 in accordance with his new employment agreement. This increase to wage expense was offset with fewer employees, and therefore lower wage expense in 2026.
Professional fees for the six months ended June 30, 2026, were $268,669 compared to $412,139 for the six months ended June 30, 2025, a decrease of $143,470 or 34.8%. Professional fees consist mainly of audit and legal fees. The decrease in the current period is due to a decrease in legal fees.
General and administrative expenses for the six months ended June 30, 2026, was $1,162,977 compared to $981,627 for the six months ended June 30, 2025, an increase of $181,350 or 18.5%. The increase was mainly due to an increase of utility expense and insurance expense.
For the six months ended June 30, 2026, the Company recognized total other income of $397,368, consisting of $76,002 of interest expense for related parties and an unrealized loss in the fair value of cryptocurrency of $20,648. This was offset by a $494,018 gain on the settlement of accounts payable through the issuance of common stock. For the six months ended June 30, 2025, we incurred interest expense for related parties of $395,124 and other expense of $45,000. We also recognized a loss on the extinguishment of debt of $52,000 and a loss on conversion of accrued salaries and loans payable of $175,763.
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Our net loss for the six months ended June 30, 2026, was $2,132,388 compared to $3,213,312 for the six months ended June 30, 2025. This was a decrease in our net loss of $1,080,924.
Liquidity and Capital Resources
Changes in Cash Flows
Operating Activities
For the six months ended June 30, 2026, we used $2,397,514 of cash in operating activities, which included our net loss of $2,132,388 offset by non-cash reconciling items of $6,822 for depreciation, $226,320 for stock compensation expense for shares issued, an unrealized loss for the fair value of cryptocurrency of $20,648 and a $494,018 gain on the settlement of accounts payable and debt. There were net changes in operating assets and liabilities of $24,898.
For the six months ended June 30, 2025, we used $1,175,615 of cash in operating activities, which included our net loss of $3,213,312 offset by $867,196 of non-cash reconciling items and net changes in operating assets and liabilities of $1,170,501.
Financing Activities
For the six months ended June 30, 2026, we received net cash of $3,661,963 in financing activities. We received $14,024 from loans from our CEO, $2,619,999 from the sale of prefunded warrants and contributed capital of $9,940. We also received $1,097,000 from the sale of common stock, net of $203,000 offering fees. The shares were sold at $0.60 per share. We made repayments on our note payable of $34,000 and to our CEO of $45,000.
For the six months ended June 30, 2025, we received net cash of $1,150,841 from financing activities as a result of receiving $346,073 from our CEO and $887,786 from the sale of common stock, and a decrease in our cash overdraft of $5,299. We made repayments on our note payable of $38,838 and to our CEO of $38,881.
Liquidity and Capital Resources
At June 30, 2026, the Company had cash of $1,280,226 and other current assets of $1,418,035. We have reviewed the cash flow activity during the six months ended June 30, 2026 and projected cash flow forecast for the remainder of 2026 and performed an overall analysis of market trends to determine whether or not it has sufficient liquidity to continue as a going concern for a period of at least twelve months from the date of this Quarterly Report. Based on projected cash to be used in operations to be offset by expected proceeds from capital raises, the ATM program and loan proceeds from Ronny Yakov under the loan agreement, the Company believes it has sufficient liquidity in order to sustain operations for at least the twelve months following the filing of this Quarterly Report. However, management recognizes that it may be required to obtain additional resources to successfully execute its business plans. No assurances can be given that management will be successful in raising additional capital, if needed, or on acceptable terms. Management believes that the Company’s existing cash resources, together with expected capital raises, potential advances under the ATM program, related party financing, and other available funding sources, will be sufficient to support operations through August 14, 2027.
On August 7, 2026, the Company entered into an Equity Distribution Agreement (the “Agreement”) with Maxim Group LLC (“Maxim”) to create an at-the-market equity program. Under the Agreement, the Company may offer and sell its common stock, par value $0.0001 per share, from time to time as set forth in the Agreement (the “ATM Offering”). The Company has agreed to pay Maxim a commission equal to 3.0% of the gross sales price from the sales of Shares pursuant to the Agreement. In addition, the Company agreed to reimburse Maxim for its costs and out-of-pocket expenses incurred in connection with its services, including the fees and out-of-pocket expenses of its legal counsel.
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During the six months ending June 30, 2026, Mr. Yakov advanced the Company $14,024 and received repayments of $45,000. As of June 30, 2026 and December 31, 2025, the amount due to Yakov Holdings, LLC is $136,339 and $167,315, respectively.
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 offering closed on January 26, 2026, generating aggregate net proceeds of approximately $1,096,783, after 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 stock at a combined purchase price of $1.05 per unit. The pre-funded warrants are immediately exercisable at a nominal exercise price, and the common warrants have an exercise price of $0.92 per share and a five-year term. The offering closed on February 19, 2026, generating net proceeds of approximately $2,619,713, after deducting placement agent fees and other offering expenses.
On January 21, 2026, the Company issued 550,000 shares of common stock for payment of various accounts payable totaling approximately $518,731. The shares were valued at $0.80, the closing stock price on the date of grant, for a total value of $437,325. The Company recorded a gain on the extinguishment of debt of $81,406.
On January 21, 2026, the Company issued 350,000 shares of common stock for prepaid legal services totaling approximately $278,250. The shares were valued at $0.80, the closing stock price on the date of grant.
Critical Accounting Policies
Refer to our Form 10-K for the year ended December 31, 2025, for a full discussion of our critical accounting policies.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this Item.
ITEM 4. CONTROLS AND PROCEDURES
During the quarter ended June 30, 2026, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the required time periods specified in the Commission’s rules and forms and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our principal executive officer and principal financial officer, do not expect that our disclosure controls and procedures or our internal controls will prevent all errors or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal controls that are reasonably likely to materially affect, our internal control over financial reporting during the quarter ended June 30, 2026.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is engaged ongoing litigation with FFS Data Corporation (“FFS”) in the Supreme Court of the State of New York, County of New York relating to a breach of contract in connection with the Acquired Merchant Portfolio whereby the Company is making a claim to recover the purchase price of the Acquired Merchant Portfolio and FFS is seeking the balance of the purchase price of the Acquired Merchant Portfolio. In addition, in connection with the litigation with FFS, the Company has also filed an action in the District Court of the 42nd Judicial District, Taylor County, Texas against Clear Fork Bank, N.A., f/k/a First National Bank Albany/Breckenridge (the “Bank”), the payment processing bank for the Acquired Merchant Portfolio, for damages the Company suffered as a result of it having to cease processing transactions for the merchants underlying the Acquired Merchant Portfolio. The Bank has filed a counterclaim for purported overdrafts by the Company in connection with the transactions processed since the acquisition of the Acquired Merchant Portfolio by the Company. e District Court of the 42nd Judicial District, Taylor County, Texas. The Texas action is currently in discovery, and the Company has amended its pleading in that action to assert additional causes of action and to add additional individual defendants. In the New York action, discovery has been completed and the parties are submitting their respective motions for summary judgment by September 11, with opposition papers due on October 16 and reply papers due on November 13. FFS also commenced an action in the Supreme Court of the State of New York seeking indemnification for legal fees it incurred in defending an action in Hawaii. Such action is currently in the discovery phase with deposition to be held in September. Earlier this year, PLS Checking Cashing commenced an action in the Supreme Court, State of New York, County of New York against the Company and the Bank alleging that they failed to remit payment to it of approximately $125,000. The Company has cross-claimed against the Bank, and the Bank has yet to respond to the cross-claims.
DMINT is currently in a contract dispute with a contractor. The Company has paid $100,000 to the contractor for work completed and materials provided and returned materials to offset the potential liability of approximately $444,000. The Company has recorded just over $315,000 in accounts payable related to the matter. The matter continues to be in discovery; however, the parties continue to discuss settlement. The parties are working on a payment schedule but have been unable to agree on terms to date.
Other than discussed above, there are no material claims, actions, suits, proceedings, or investigations that are currently pending or, to the Company’s knowledge, threatened by or against the Company or respecting its operations or assets, or by or against any of the Company’s officers, directors, or affiliates
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this Item. We are nonetheless voluntarily providing the following risk factor.
Our planned tokenized offering application is in the development stage, may not be launched as anticipated, and exposes us to legal, regulatory and operational risks.
As described in Note 1 to our condensed consolidated financial statements, we are developing an application intended to enable issuers using our CrowdPay platform to generate tokenized offerings, provide investors with additional payment options and access live AI chatbot support. The application is in the development stage and has not been launched. We currently expect to release an initial update during the fourth quarter of 2026 and to complete a full launch in early 2027, but the timing may change and the application may not be launched at all. The offer, sale and transfer of tokenized securities is subject to evolving and uncertain regulation under federal and state securities laws, including registration, broker-dealer, transfer agent, custody and, in certain circumstances, money transmission requirements, and regulators have brought enforcement actions against participants in digital asset markets. The application will also depend on third-party blockchain networks, smart contracts and service providers, which expose us to risks of technical failure, cybersecurity incidents, loss of private keys and irreversible transaction errors. We also expect the application to offer stablecoin payment options provided by licensed or otherwise authorized third parties. Stablecoin payment activity is subject to a developing and uncertain federal and state regulatory framework, including the federal payment stablecoin regime and state money transmission licensing requirements, and we would depend on these providers obtaining and maintaining the licenses and authorizations necessary to support such transactions. The loss of a provider’s authorization, a change in the applicable regulatory framework, or a determination by a regulator that our own activities require licensing could require us to suspend, modify or abandon these payment options. In addition, the market for tokenized securities may not develop as we anticipate, and we may not generate meaningful revenue from the application. The occurrence of any of these events could adversely affect our business, reputation, results of operations and financial condition.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
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 offering closed on January 26, 2026, generating aggregate net proceeds of approximately $1,096,783, after 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 stock at a combined purchase price of $1.05 per unit. The pre-funded warrants are immediately exercisable at a nominal exercise price, and the common warrants have an exercise price of $0.92 per share and a five-year term. The offering closed on February 19, 2026, generating net proceeds of approximately $2,619,713, after deducting placement agent fees and other offering expenses. During the six months ended June 30, 2026, all 2,857,142 warrants were exercised for shares of common stock for total proceeds of $286.
On January 21, 2026, the Company issued 550,000 shares of common stock for payment of various accounts payable totaling approximately $518,731. The shares were valued at $0.80, the closing stock price on the date of grant, for a total value of $437,325. The Company recorded a gain on the extinguishment of debt of $81,406.
On January 21, 2026, the Company issued 350,000 shares of common stock for prepaid legal services totaling approximately $278,250. The shares were valued at $0.80, the closing stock price on the date of grant.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a third party for AI consulting services. The shares were valued at $0.3059, the closing stock price on the date of grant, for total non-cash expense of $357,903.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a third party for consulting services. The shares were valued at $0.3059, the closing stock price on the date of grant, for total non-cash expense of $357,903.
On August 7, 2026, the Company issued 1,250,000 shares of common stock to a third party for AI consulting services. The shares were valued at $0.3059, the closing stock price on the date of grant, for total non-cash expense of $382,375.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a third party for consulting services. The shares were valued at $0.3059, the closing stock price on the date of grant, for total non-cash expense of $357,903.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a third party to be used for the settlement of accounts payable. The shares were valued at $0.3059, the closing stock price on the date of grant, for total value of $357,903.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a service provider for the settlement of accounts payable. The shares were valued at $0.3059, the closing stock price on the date of grant, for total value of $357,903.
On August 7, 2026, the Company issued 1,170,000 shares of common stock to a third party to be used for the settlement of accounts payable. The shares were valued at $0.3059, the closing stock price on the date of grant, for total value of $357,903.
All shares of common stock issued pursuant to these transactions were issued in reliance upon Section 4(a)(2) of the Securities Act and are restricted securities under Rule 144.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
During the six months ended June 30, 2026, no
director or officer of the Company, as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934,
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ITEM 6. EXHIBITS
| Exhibit Number |
Exhibit Description | |
| 31.1 | Certification of Chief Executive Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002. (filed herewith) | |
| 31.2 | Certification of Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002. (filed herewith) | |
| 32 | Certification of Chief Executive Officer and Chief Financial Officer, pursuant to 18 United States Code Section 1350, as enacted by Section 906 of the Sarbanes-Oxley Act of 2002. (filed herewith) | |
| 101.INS | Inline XBRL Instance Document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| * | Filed herewith |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Date: August 14, 2026 | By: | /s/ Ronny Yakov |
| Name: | Ronny Yakov | |
| Title: | Chief Executive Officer | |
| (Principal Executive Officer) | ||
| Date: August 14, 2026 | By: | /s/ Rachel Boulds |
| Name: | Rachel Boulds | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |
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