What changed in this filing

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Item 1A. Risk Factors

2026-08-13 compared with 2026-05-14 · 826 added, 54 removed, 39 unchanged (96% of the section changed)

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to time in our future filings with the SEC.

As of the date of this Quarterly Report on Form 10-Q, there have been no material updates

As of the date of this Quarterly Report, there have been no material updates

or changes with respect to the risk factors previously disclosed in our Annual Report, other than as set forth below, which should be

read in conjunction with the risks described in our Annual Report.

Risks Related to Ownership

of Our Common Stock

We must satisfy Nasdaq’s continued listing

requirements, and a failure to do so could result in the delisting of our Common Stock.

Our Common Stock and public warrants are listed on

To maintain that listing, we must satisfy Nasdaq’s continued listing requirements, including corporate governance requirements

relating to the composition of the Board and its committees, as well as other quantitative and qualitative standards.

From time to time,

we may not be in compliance with one or more of these requirements, as occurred following a director resignation in January 2026 that

is described in our Current Report on Form 8-K filed with the SEC on January 23, 2026.

Although we regained compliance and that matter

has been closed by Nasdaq, we cannot assure you that we will remain in compliance with all applicable Nasdaq requirements in the future.

If we fail to satisfy Nasdaq’s continued listing requirements and do not timely regain compliance, Nasdaq could commence suspension

or delisting procedures, which could reduce the liquidity and market price of our Common Stock and impair our ability to raise capital.

Related to CFO Silvia.

1 unchanged sentence

timely, may hamper production or may not completely satisfy its customers.

Silvia has performed, and continues to perform, extensive internal testing on its products and features, though, like the rest of the

industry, it currently has a limited frame of reference by which to evaluate certain aspects of its long-term quality, reliability, durability

and performance characteristics, including exposure to or consequence of external attacks.

While CFO Silvia attempts to identify and

address or remedy defects it identifies pre-production and sale, there may be latent defects that it may be unable to detect or control

for in its products, and thereby address, prior to its sale to customers.

Silvia has performed, and continues to perform, extensive internal testing on its products and features, however, like the rest of

the industry, it currently has a limited frame of reference by which to evaluate certain aspects of its long-term quality,

reliability, durability and performance characteristics, including exposure to or consequence of external attacks.

While CFO Silvia

attempts to identify and address or remedy defects it identifies during the pre-production and sale phases, there may be latent defects

that it may be unable to detect or control for in its products, and thereby address, prior to its sale to customers.

the lack of a public market for CFO Silvia’s capital stock made it difficult to evaluate the fair market value of CFO Silvia’s

capital stock, the value of our shares of Common Stock issued to CFO Silvia’s stockholders in connection with the Merger may be

capital stock, the value of our shares of Common Stock issued to CFO Silvia’s stockholders in connection with the CFO Silvia Acquisition may be

more or less than the fair market value of CFO Silvia’s capital stock.

3 unchanged sentences

Because the percentage of our equity issued to CFO

Silvia’s stockholders in the Merger was determined based on negotiations between the parties, it is possible that the value of

our shares of Common Stock issued to CFO Silvia’s stockholders in connection with the Merger was more or less than the fair market

Silvia’s stockholders in the CFO Silvia Acquisition was determined based on negotiations between the parties, it is possible that the value of

our shares of Common Stock issued to CFO Silvia’s stockholders in connection with the CFO Silvia Acquisition was more or less than the fair market

value of CFO Silvia’s capital stock.

Related to the Merger

existing stockholders have reduced ownership and voting interests in ProCap following completion of the Merger.

issued 7,516,951 shares of our Common Stock upon completion of the Merger;

further, we may issue up to 9,000,000 additional earnout shares

in a five-year period.

Based on the number of shares of Common Stock of ProCap outstanding on February 10, 2026, the record date for

our Annual Meeting of Stockholder held on March 27, 2026, upon the completion of the Merger, current ProCap stockholders and former CFO

Silvia stockholders would own approximately 90.3% and 9.7% of our Common Stock, respectively.

the Merger occurred, each CFO Silvia stockholder who received shares of our Common Stock became a stockholder of ProCap.

the percentage ownership of ProCap held by each of the stockholders prior to the Merger was smaller than such stockholder’s percentage

ownership of ProCap prior to the Merger.

Related to the CFO Silvia Acquisition

existing stockholders have reduced ownership and voting interests in ProCap following completion of the CFO Silvia Acquisition.

We issued 8,416,951 shares of our Common Stock upon

completion of the CFO Silvia Acquisition;

further, we may issue up to 9,000,000 additional earnout shares in a five-year period.

on the number of shares of Common Stock of ProCap outstanding on February 10, 2026, the record date for our Annual Meeting of Stockholder

held on March 27, 2026, upon the completion of the CFO Silvia Acquisition, current ProCap stockholders and former CFO Silvia stockholders

would own approximately 90.3% and 9.7% of our Common Stock, respectively.

When the CFO Silvia Acquisition occurred, each CFO

Silvia stockholder who received shares of our Common Stock became a stockholder of ProCap.

As a result, the percentage ownership of ProCap

held by each of the stockholders prior to the CFO Silvia Acquisition was smaller than such stockholder’s percentage ownership of

ProCap prior to the CFO Silvia Acquisition.

Our current stockholders will, therefore, have proportionately less ownership and voting interests

in ProCap following the Merger than they had prior to the Merger.

may fail to realize the anticipated benefits of the Merger.

Company believes that there are significant benefits that may be realized by the Merger.

However, the efforts to realize these benefits

will be a complex process and may disrupt our existing operations if not implemented in a timely and efficient manner.

The full benefits

of the Merger may not be realized as expected or may not be achieved within the anticipated time frame, or at all.

Failure to achieve

the anticipated benefits of the Merger could adversely affect our business, operating results or financial condition and cause the combined

business to not perform as expected.

Specifically, the following issues, among others, must be addressed to realize the anticipated benefits

of the Merger:

in ProCap following the CFO Silvia Acquisition than they had prior to the CFO Silvia Acquisition.

may fail to realize the anticipated benefits of the CFO Silvia Acquisition.

The Company believes that there are significant benefits that may be realized

by the CFO Silvia Acquisition.

However, the efforts to realize these benefits will be a complex process and may disrupt our existing operations

if not implemented in a timely and efficient manner.

The full benefits of the CFO Silvia Acquisition may not be realized as expected or

may not be achieved within the anticipated time frame, or at all.

Failure to achieve the anticipated benefits of the CFO Silvia Acquisition

could adversely affect our business, operating results or financial condition and cause the combined business to not perform as expected.

Specifically, the following issues, among others, must be addressed to realize the anticipated benefits of the CFO Silvia Acquisition:

certain of the companies’ financial, reporting and corporate functions;

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unable to successfully integrate CFO Silvia, our business, results of operations, and cash flows could be materially adversely affected.

Related to Ownership of Our Common Stock.

a result of the resignation of one of our directors in January 2026, we are not in compliance with Nasdaq rules regarding the composition

of our Board and audit committee, and there is a risk of delisting if the non-compliance is not cured within the time period allowed

January 21, 2026, William H.

Miller IV resigned from our Board.

Miller was one of three members of the audit committee of our Board.

As a consequence of Mr.

Miller’s resignation, we became out of compliance with Nasdaq Listing Rule 5605(c)(2), which requires that

the board of directors of a Nasdaq listed company have an audit committee made up of at least three independent directors.

22, 2026, we advised Nasdaq of Mr.

Miller’s resignation, its consequences with regard to compliance with Nasdaq Listing Rule 5605(c)(2)

and our intention to regain compliance with Nasdaq Listing Rule 5605(c)(2) in a timely manner.

In accordance with Nasdaq Listing Rule

5605(c)(4), we have an automatic cure period in order to regain compliance with Nasdaq Listing Rule 5605(c)(2) until (i) the earlier

of our next annual stockholders’ meeting or January 21, 2027; or (ii) if our next annual stockholders’ meeting is held

before July 20, 2026, then we must evidence compliance no later than July 20, 2026.

We intend to appoint a third independent director

to our Board and audit committee and thereby regain compliance with Nasdaq Listing Rule 5605(c)(2), prior to our next annual meeting

of stockholders.

However, if we are unable to regain compliance with Nasdaq Listing Rule 5605(c)(2) in a timely manner, Nasdaq will

commence suspension and delisting procedures.

Risks Related to Our Expansion into Asset Management

Our expansion into the

asset management business is a new initiative, and we may not successfully develop or operate this business.

Our expansion into the asset management

business is a new initiative, and we, including our newly formed asset-management subsidiaries, have a limited operating history

forming, marketing, managing and administering private funds and other investment products.

Our initial asset-management product,

the Initial Fund, is intended to be a closed-end private fund, for which the Investment Manager, is expected to provide investment

management services.

The Initial Fund is intended to seek long-term capital appreciation primarily through technology-sector

investments, which investments are generally illiquid and long-term in nature, and the Initial Fund is expected to have broad

investment flexibility, including the ability to make co-investments and to invest through alternative investment vehicles and other

Although certain members of our management team may have investment experience, operating an asset management platform

requires specialized investment, legal, regulatory, compliance, accounting, valuation, tax, investor-relations,

information-technology and administrative expertise.

Different fund structures and investment strategies may require additional

capabilities that we do not currently possess or may be unable to develop, acquire or scale effectively.

Developing our asset management

business may require significant expenditures, investments in personnel and systems, and substantial management attention before the business

generates meaningful revenue.

These efforts may divert personnel and other resources from our existing operations, disrupt our business,

increase our fixed cost base and expose us to additional liabilities.

The Initial Fund and any future products may be unable to raise

sufficient investor capital, identify and consummate suitable investments, deploy committed capital successfully, generate competitive

investment returns, develop products that are attractive to investors or achieve sufficient scale to operate the business profitably.

We cannot assure you that our

asset management business will achieve its anticipated strategic or financial benefits.

A failure to develop and operate the business

successfully could materially and adversely affect our business, financial condition, results of operations and reputation.

The success of our asset

management business depends on our ability to raise sufficient third-party capital and successor funds in a highly competitive market.

Our ability to generate management fees and

performance-based compensation will depend substantially on the ability of the Investment Manager and the General Partner to raise

capital commitments from third-party investors for the Initial Fund and any successor funds or other investment products.

Fundraising is subject to numerous factors outside our control, including general economic and financial-market conditions, interest

rates, investor liquidity and asset-allocation decisions, the availability of distributions from investors’ existing

private-market investments, investment performance and track record, the reputation and continued service of the relevant investment

professionals, regulatory developments and the terms offered by competing investment products.

The Initial Fund may not reach its

target size, and its pool of eligible investors is limited by the private-offering and Investment Company Act of 1940, as amended

(the “Investment Company Act”) exemptions on which it relies, which restrict participation to investors that satisfy

specified eligibility requirements.

The asset management industry

is highly competitive.

We and the Funds compete with established alternative asset managers, traditional asset managers, private equity

and venture capital firms, financial institutions, family offices, corporate investors and other sponsors.

Many competitors have longer

operating histories, established investment records, broader distribution networks, greater financial and personnel resources, more developed

compliance and operating infrastructure, and stronger relationships with institutional investors.

Certain competitors may also offer lower

fees, greater liquidity, more favorable investment terms, broader co-investment opportunities or products with different risk and return

characteristics.

To attract investors, the Investment

Manager or the General Partner may reduce or waive management fees, reimburse or bear Fund expenses, provide preferential rights through

side letters, offer co-investment opportunities or otherwise agree to terms that reduce the revenues or profitability of our asset management

In addition, management fees from closed-end Funds may decline following the expiration of their investment periods or as invested

capital is realized.

The ability to maintain or grow management-fee revenue may therefore depend on the ability to raise successor Funds

or other investment products before fees from existing Funds decline.

A failure to raise sufficient

fee-paying capital could reduce management fees, limit the ability to deploy capital and earn carried interest or other performance-based

compensation, impair the ability to raise future Funds and leave our asset management business with an operating cost base that is disproportionate

In addition, if limited partners default on or delay funding their capital commitments, a Fund’s ability to deploy

capital could be impaired, and the General Partner or the Company may elect or agree to provide bridge funding or other support, and such

Fund may seek to borrow or obtain other financing, any of which could adversely affect such Fund’s investments, the fees and performance-based

compensation payable in respect of such Fund and our reputation.

Poor investment performance

and the structure of our management fees and performance-based compensation could adversely affect our revenues and cause our results

to be volatile.

The revenues and other economic

returns generated by our asset management business will depend on the amount of fee-paying capital or assets under management, the applicable

fee rates, the investment performance of the Funds and the timing and amount of investment realizations.

For the Initial Fund, management

fees are payable to the Investment Manager and are based on each limited partner’s capital commitment during the Fund’s investment

period and on invested capital thereafter, and carried interest is payable to the General Partner.

The Company does not receive any management

fees or carried interest directly;

those economics are earned by the Investment Manager and the General Partner, respectively.

Other current

or future products may calculate fees on a different basis.

Accordingly, increases or decreases in total capital commitments may not result

in proportionate changes in management-fee revenue.

Carried interest, incentive

fees, and other performance-based compensation generally depend on a Fund achieving specified investment returns or distribution thresholds.

Because the Initial Fund has a long-term, multi-year investment period, any carried interest is long-dated and depends on the timing and

amount of investment realizations;

such compensation may not be earned for many years, may be concentrated in a limited number of periods

and may vary materially.

Newly formed Funds may generate little or no performance-based compensation while they deploy capital, and there

can be no assurance that any Fund will generate returns sufficient for the General Partner to earn carried interest or for us to realize

the related economics.

Poor investment performance

could reduce the value of fee-paying assets, delay or eliminate performance-based compensation, cause investors to decline to invest in

future Funds, result in demands for fee concessions and harm our reputation.

Personnel, compliance, technology, insurance and other operating

expenses of the asset management business may continue regardless of investment performance or the amount of capital raised.

The General Partner may be required

to return previously distributed carried interest pursuant to a fund-level clawback provision, the amount of which may be affected by

investment losses, the timing of realizations, prior distributions, tax payments and the terms of the applicable Fund documents.

the General Partner is our wholly-owned subsidiary, any such clawback or other repayment obligation would reduce amounts otherwise available

to us and could adversely affect our liquidity and results of operations.

As a result of these factors, the revenues and earnings generated

by our asset management business may be volatile, difficult to predict and uneven from period to period.

The Initial Fund expects to

invest primarily in technology-sector companies and assets, many of which may be private and illiquid.

Its areas of focus may include

artificial intelligence, defense technology, hardware, health technology, software and other technology-related solutions, although the

Initial Fund has broad flexibility as to geography, strategy and asset class.

A primary focus on private technology investments may heighten

the volatility of the Initial Fund’s performance and increase valuation, exit and fundraising risk, because such investments are

often illiquid, may take years to mature, may be difficult to value or realize and are subject to rapid technological, competitive and

regulatory change.

In addition, to the extent a Fund incurs indebtedness or uses bridge financing, such leverage may magnify investment

losses and increase the Fund’s liquidity demands.

Our asset management activities

subject us to extensive and evolving regulatory, fiduciary and compliance obligations and potential liability.

The asset management industry is subject to

extensive and evolving federal, state and foreign regulation.

Neither the Investment Manager nor the General Partner, each of which

is our wholly-owned subsidiary, is currently registered as an investment adviser with the SEC, and the Investment Manager currently

relies on exemptions from registration under applicable federal and state law.

In connection with the proposed Silvia ETFs, the

Investment Manager expects to register with the SEC as an investment adviser under the Advisers Act, and there can be no assurance

that its registration will become effective on the anticipated timeline or at all.

The General Partner may also become registered in

the future, in its discretion or if required by applicable law, and there can be no assurance that any exemption on which the

Investment Manager or the General Partner relies will remain available.

Growth in regulatory assets under management, changes in the

activities of the Investment Manager or the General Partner, or changes in applicable law could require registration or subject the

asset management business to additional regulatory requirements.

Depending on the nature and size of our activities, we or one or

more of our subsidiaries could also become subject to investment-adviser or other regulation.

The Initial Fund is being offered

in a transaction exempt from registration in reliance on Section 4(a)(2) and Regulation D of the Securities Act of 1933, as amended, and

relies on the exemption from registration under the Investment Company Act provided by Section 3(c)(1) therein.

The availability of these

exemptions depends on compliance with numerous conditions, including that each investor satisfy applicable eligibility requirements, generally,

that the investor be an “accredited investor” and a “qualified purchaser” or “knowledgeable employee,”

as well as restrictions relating to the manner of offering Fund interests, the number and nature of investors, transfers of Fund interests

and the activities of the Funds and their affiliates.

The asset management activities

of the Investment Manager and the General Partner may subject them to fiduciary obligations and regulatory requirements and may expose

us, through our ownership of them, to related compliance costs, liabilities and reputational risks, including requirements relating to,

among other matters:

· Marketing, advertising and presentation of investment performance;

· Books and records and regulatory reporting;

· Custody and safeguarding of assets;

· Valuation of investments;

· Allocation of investments, co-investments, fees and expenses;

· Transactions involving affiliates;

· Personal trading and political contributions;

· Receipt and use of material nonpublic information;

· Anti-money-laundering, sanctions and investor-identification controls;

· Privacy, cybersecurity and protection of confidential investor information;

· Pay-to-play restrictions;

· Employee benefit plan and Employee Retirement Income Security Act of 1974,

as amended matters;

· Disclosure and management of conflicts of interest.

Compliance with these requirements

may require significant expenditures and substantial attention from management and other personnel.

The applicable regulatory framework

may change, and regulators may interpret existing requirements differently from us.

The launch of additional Funds with different structures,

investment strategies or investor bases could further increase the complexity and cost of the compliance program.

We, our subsidiaries, the Investment

Manager, the General Partner, and their respective directors, officers and employees could be subject to liability for errors of judgment,

mistakes of law, breaches of fiduciary duty or other acts or omissions in connection with the management of the Funds.

A failure to comply

with applicable law, regulation or Fund documents could result in regulatory examinations or investigations, investor claims, litigation,

fines, censures, disgorgement, limitations on activities, suspension or loss of registrations, disqualification from managing assets for

certain investors, termination of advisory relationships and reputational harm.

Any of these consequences could materially and adversely

affect our business and our ability to raise and manage investor capital.

Capital we use to seed,

warehouse, or support our Funds may be illiquid and expose us to losses, reduce our liquidity, and increase the complexity and volatility

of our financial statements.

The General Partner is expected

to contribute all or substantially all of the Initial Fund’s initial capital, which may be used to make the Initial Fund’s

initial investments and the Initial Fund’s initial expenses.

As third-party investors are admitted at subsequent closings, a portion

of the General Partner’s funded capital is expected to be returned.

To the extent the General Partner or another of our subsidiaries

provides such capital, that capital represents our capital and exposes us to the risks described in this risk factor.

We may also determine, or be

perceived by investors or counterparties as having an obligation, to provide additional capital or support to a Fund beyond the General

Partner’s commitment and any pre-closing seed funding, which could include acquiring or warehousing additional investments, bridging

investor capital contributions, making loans, or providing guarantees, indemnities or other financial support.

We are under no obligation

to provide any such additional support unless we agree to do so, and the nature and extent of any such support have not been determined.

Capital that we fund, directly

or through the General Partner or another subsidiary, in or alongside the Funds may be illiquid, long-term in nature and subject to significant

valuation uncertainty.

There can be no assurance regarding the timing or amount of any return on such capital, we may be required to hold

our positions for extended periods, the Funds may perform poorly, and we could lose some or all of the capital we invest.

to fund the General Partner’s commitment or to seed, warehouse or otherwise support the Funds would not be available for our existing

operations, debt service, acquisitions or other corporate purposes, which could adversely affect our liquidity and capital resources and

may limit our ability to launch additional Funds or pursue other strategic initiatives.

Whether we are required to consolidate

the Initial Fund or any other sponsored investment product in our financial statements depends on our economic interests in, decision-making

rights over and other relationships with the relevant vehicle.

These determinations are complex, require the application of significant

judgment and may change over time as our interests in or relationships with a Fund change.

If we were required to consolidate a Fund or

another sponsored investment product, the reported size and complexity of our balance sheet could increase, we could be required to recognize

a Fund’s assets, liabilities, revenues, expenses and noncontrolling interests, and our reported results could become more volatile.

Valuations of private

and illiquid investments are subjective and may differ materially from the values ultimately realized.

The Funds may invest in private

companies and other assets for which readily observable market prices are unavailable or unreliable.

For the Initial Fund, the General

Partner will determine the value of the Fund’s assets at least quarterly, and in connection with distributions, in accordance with

the Fund’s valuation policies, and the General Partner’s good-faith determinations of value are generally conclusive and binding

under the Fund documents.

The valuation of these investments requires the application of methodologies, estimates, assumptions and judgments

concerning matters such as comparable public companies and transactions, projected financial performance, discount rates, capital structures,

market conditions and the probability and timing of future financing, sale or liquidity events.

There is no single standard

for determining the fair value of a private or illiquid investment, and different market participants may assign materially different

values to the same investment.

Information used in a valuation may be incomplete, inaccurate or subsequently revised.

The Initial Fund

does not intend to commission periodic independent appraisals of its portfolio companies.

Even if an administrator, appraisal firm or

other third party were engaged to assist with the valuation process, doing so would not eliminate the subjective nature of that process

or assure that a reported value will ultimately be realized.

The amount ultimately realized

upon the sale or other disposition of an investment may differ materially from its previously reported value.

Valuations may affect, in

each case to the extent applicable:

· Reported Fund performance and net asset value;

· Management fees and carried interest;

· Allocations among investors;

· Capital accounts;

· The admission of investors at subsequent closings;

· In-kind distributions and other transactions involving Fund assets;

· Our seed and co-investment balances;

· Our financial statements and results of operations.

Investors, auditors or regulators

may disagree with the methodologies, assumptions or conclusions used in valuing Fund investments.

Valuation errors or disputes could require

adjustments to Fund financial statements, reimbursement of fees, changes to carried interest, repayment of previously distributed amounts,

changes to our financial statements, litigation or regulatory action.

Valuation issues could also impair investor confidence, harm our

reputation and make it more difficult to raise additional capital.

Actual, potential or perceived

conflicts of interest could adversely affect our Funds, their investors, our business and our reputation.

Our asset management activities

will create actual, potential and perceived conflicts among us and our subsidiaries, including the Investment Manager and the General

Partner, our and their respective directors, officers and employees, the Funds, other investment vehicles and accounts, portfolio companies,

co-investors, Fund investors and our public stockholders.

In particular, Anthony Pompliano serves as our Chief Executive Officer and Chairman

and is identified in the Initial Fund’s offering materials as the Chairman and Chief Executive Officer of the General Partner, the

portfolio manager of the Investment Manager, and the Initial Fund’s key person.

Other personnel may likewise have overlapping positions,

responsibilities or economic interests and may be required to allocate their time and attention among our existing business, the Funds

and other affiliated activities.

Conflicts may arise in connection

with, among other matters:

· The allocation of investment and co-investment opportunities;

· The allocation of personnel, time and other resources;

· The allocation of due-diligence, broken-deal, legal, compliance and other

· Transactions among Funds, affiliated entities and portfolio companies;

· Services provided by us or our affiliates to Funds or portfolio companies,

and the fees received for those services;

· Differences in management fees, carried interest and other economic arrangements

· Side letters and preferential rights granted to particular investors;

· The valuation of investments;

· The timing and terms of investment purchases, sales and distributions;

· Continuation vehicles and other transactions that extend an investment’s

holding period;

· Personal investments made by our personnel or their affiliates;

· The receipt, sharing or use of material nonpublic information;

· The funding and subsequent return of General Partner or Company capital;

· Our responsibilities to public stockholders as compared with the fiduciary

or contractual duties owed by the Investment Manager or the General Partner to the Funds and their investors.

Different fee structures and

performance-based compensation arrangements may create an incentive to allocate opportunities to Funds or accounts that generate greater

fees or carried interest.

Carried interest may also create an incentive to cause a Fund to make investments with a higher risk of loss,

dispose of investments at a particular time or hold investments for longer than would otherwise be the case.

Conversely, investments made

with capital provided by us may create incentives that differ from those relating to investments made primarily with third-party capital.

The Investment Manager and the

General Partner may establish policies, procedures, information barriers and governance processes designed to identify and mitigate conflicts

of interest, and we may seek review by independent directors, advisory committees or other bodies where appropriate.

These measures may

not identify or adequately address every conflict, and conflicts may not be resolved in favor of us, our public stockholders, a particular

Fund or its investors.

The duties of our directors and officers to us and our stockholders may differ from, and may conflict with, the

fiduciary or contractual duties that the Investment Manager and the General Partner owe to the Funds and their investors.

Actual or perceived

failures to manage conflicts appropriately could result in investor dissatisfaction, loss of investor capital, adverse publicity, litigation,

regulatory investigations or enforcement actions, impair the ability to raise future Funds and damage our reputation.

Our asset management business

depends on key personnel and our ability to attract and retain specialized professionals.

The success of our asset management

business will depend substantially on the investment judgment, industry knowledge, reputation, relationships and continued service of

a limited number of senior professionals, including Mr.

Pompliano, who is the Initial Fund’s key person.

Investors may commit capital

to a Fund in significant part because of the identity, experience and perceived capabilities of particular investment professionals.

The death of Mr.

his removal, resignation or withdrawal from specified positions with the Investment Manager or the General Partner, or his inability to

perform his advisory duties for a specified period, would constitute a key person event under the Initial Fund’s documents.

a key person event, the Initial Fund’s investment period would be suspended, and if the requisite investors do not approve one or

more replacement principals or elect to reinstate the investment period within the applicable cure period, the investment period would

A suspension or termination of the investment period would reduce the Initial Fund’s ability to deploy capital and could

reduce future management fees and performance-based compensation.

More generally, the death, disability, departure, reduced involvement

or reputational impairment of a key professional could disrupt the management of existing Funds, impair investment sourcing and decision-making,

adversely affect investment performance and make it more difficult to raise additional capital.

We will also need to recruit

and retain qualified investment, finance, accounting, valuation, legal, compliance, tax, operations, information-technology and investor-relations

professionals.

Competition for experienced asset management personnel is significant, and established investment managers may have greater

resources or be able to offer more attractive compensation, carried-interest participation, investment opportunities or professional-development

opportunities.

The loss of key personnel, an

inability to recruit or retain qualified professionals, or a failure to develop and implement effective succession plans could materially

and adversely affect the ability to manage the Funds, generate competitive investment returns, maintain investor relationships and grow

our asset management business.

Failures in our systems,

controls or third-party service providers could disrupt our asset management business and expose us to liability.

Operating an asset management

business involves complex operational and financial processes, including investor onboarding, capital calls, cash management, investment

and expense allocations, calculation of management fees and carried interest, maintenance of investor capital accounts, portfolio valuation,

compliance testing, regulatory filings, investor reporting, tax reporting and administration of side-letter obligations.

Our existing systems, internal

controls, policies and personnel may not be adequate to perform or support these functions accurately, consistently and on a timely basis.

These risks are heightened by the material weakness in our internal control over financial reporting disclosed in Part I, Item 4 of this

Quarterly Report, which relates to inadequate segregation of duties and effective risk assessment and insufficient written policies and

procedures for accounting and financial reporting with respect to the requirements and application of both generally accepted accounting

principles and SEC guidelines.

This material weakness exists as of the date of this Quarterly Report and has not been remediated, and

our expansion into asset management would add further operational and financial-reporting complexity while this weakness persists.

error, inadequate segregation of duties, inaccurate or incomplete data, software defects, deficient policies, ineffective supervision,

unauthorized transactions, cyber incidents or failures in communications among us and our service providers could result in:

· Incorrect capital calls or distributions;

· Errors in the calculation of fees or carried interest;

· Inaccurate valuations, financial statements or investor reports;

· Misallocation of investments, income, gains, losses or expenses;

· Missed regulatory or tax filings;

· Breaches of Fund documents or side letters;

· Loss or disclosure of confidential information;

· Misappropriation or loss of assets;

· Violations of applicable law.

We and the Funds expect to rely

on third parties to perform significant functions for the Funds and our asset management business.

These are expected to include a fund

administrator engaged to provide services such as investor onboarding, calculation of management fees and carried interest, accounting,

recordkeeping and tax reporting, as well as auditors, tax advisers, counsel, custodians, banks, brokers, data hosts and other providers.

We may have limited ability to supervise the day-to-day operations, cybersecurity practices, personnel or financial condition of these

A service provider’s operational

error, system outage, cyber incident, failure to comply with law, misuse or loss of confidential information, misappropriation of assets,

insolvency or termination of services could disrupt our operations, delay investor reporting or distributions, cause financial loss and

expose us to investor claims or regulatory scrutiny.

Alternative providers may not be available on acceptable terms or within the time

required to avoid disruption.

Contractual protections, indemnification rights and insurance may not fully protect us or the Funds from

resulting losses.

A failure to develop and maintain

systems, controls and third-party oversight commensurate with the size and complexity of our asset management business could materially

and adversely affect our operations, financial condition and reputation.

Adverse events involving

our Funds, portfolio companies or asset management personnel could damage our reputation and subject us to litigation and other liabilities.

Our reputation will be important

to our ability to raise and retain investor capital, recruit personnel, source investment opportunities and maintain relationships with

regulators, service providers and other business partners.

Poor investment performance, valuation disputes, inaccurate performance or

marketing disclosures, investor-reporting failures, conflicts of interest, cybersecurity incidents, regulatory violations, employee or

service-provider misconduct, or financial distress or misconduct at a portfolio company could adversely affect perceptions of us and our

asset management business.

Because the Funds may use our

name, personnel, relationships or other resources, adverse events involving a Fund, its portfolio companies or an affiliated asset management

entity may be attributed to us even where we did not directly cause the event or are not legally responsible for the resulting loss.

publicity may spread rapidly and could damage our reputation disproportionately to the financial significance of the underlying Fund or

We, our personnel, or affiliated

entities may be named in litigation, arbitration, regulatory investigations or other proceedings involving the Funds, Fund investors,

portfolio companies, co-investors, service providers or counterparties.

Our personnel may also serve as directors, managers or observers

of portfolio companies, which could expose them and us to claims relating to the conduct or financial condition of those companies.

The Funds may be required to indemnify the Investment

Manager, the General Partner and their respective personnel, and we may have separate indemnification obligations to our own directors,

officers, employees or affiliates.

Because the Investment Manager and the General Partner are our wholly-owned subsidiaries, liabilities

incurred by them could adversely affect our financial condition and results of operations, and available Fund indemnification may be

unavailable or insufficient.

The Funds and their portfolio companies are separate legal entities.

Defense costs, settlements, judgments,

indemnification obligations, regulatory sanctions and the diversion of management attention could be material to us, whether borne directly,

through our subsidiaries or through harm to our management focus or reputation.

Available insurance may be subject to exclusions, deductibles

and coverage limits and may not cover all resulting losses.

Risks Related to Our Expansion into Exchange-Traded

Our expansion into the exchange-traded fund

(“ETF”) business is a new initiative, and the proposed Silvia ETFs may not launch when expected, attract sufficient assets

or generate meaningful revenue.

On August 13, 2026, Tidal Trust IV (the “ETF

Trust”), a Delaware statutory trust that is not affiliated with the Company, filed a registration statement on Form N-1A with the

SEC (File No.

333-285633) with respect to five proposed actively managed ETFs Silvia Anti-Money Printer ETF, Silvia Best Ideas ETF, Silvia

Elon ETF, Silvia Bitcoin mNAV Discount ETF, and Silvia Jensen Interview ETF (collectively, the “Silvia ETFs”).

The Investment

Manager, in its proposed capacity as investment sub-adviser to the Silvia ETFs (the “Sub-Adviser”), is expected to provide

portfolio-management services to the Silvia ETFs.

The registration statement remains subject to

SEC review and comment and may be amended, delayed or withdrawn.

No Silvia ETF may commence operations until the registration statement

with respect to that series has become effective, the shares of that series have been approved for listing on a national securities exchange,

and the applicable distribution and operational arrangements are in place.

The SEC staff may require changes to the names, investment

strategies, disclosure or other features of the proposed Silvia ETFs, including under Rule 35d-1 under the Investment Company Act (the

“Names Rule”) to the extent applicable to the final fund names and strategies, and there can be no assurance that any Silvia

ETF will launch on the anticipated timeline or at all.

Each Silvia ETF must qualify to rely on Rule 6c-11

under the Investment Company Act and satisfy the initial and continued listing requirements of its primary listing exchange.

requires, among other things, daily portfolio transparency and written policies and procedures governing the construction and acceptance

A failure to satisfy Rule 6c-11 or applicable exchange requirements, an inability to provide required portfolio information,

or an inability to operate an effective creation and redemption process could delay the launch of a Silvia ETF, result in a trading halt

or delisting, increase premiums and discounts to net asset value, or require changes to the fund’s investment strategy.

We have no operating history providing sub-advisory

services to registered investment companies.

Even if the proposed Silvia ETFs launch, they may fail to attract sufficient assets under

management (“AUM”) to be economically viable.

The ETF industry is intensely competitive and is dominated by asset managers

with substantially greater scale, distribution networks, brand recognition and financial resources, and is characterized by ongoing fee

ETFs that do not achieve sufficient scale may be closed, liquidated, or deregistered, and the board of trustees of the ETF

Trust (the “Fund Board”) may close or liquidate any Silvia ETF at any time, in accordance with applicable law and the fund’s

governing documents.

Launch costs, marketing expenses and any expense obligations we agree to bear may exceed the sub-advisory fee revenue

generated by the Silvia ETFs for an extended period or indefinitely.

We will depend on the Adviser and other

third parties to operate the Silvia ETFs, and our sub-advisory arrangements may be terminated on short notice without penalty.

The Silvia ETFs are expected to operate under

a white-label structure in which Tidal Investments LLC (the “Adviser”) serves as investment adviser to the Silvia ETFs and

the ETF Trust engages third-party service providers, including a distributor, administrator, custodian and transfer agent, none of which

we control or select.

The Sub-Adviser is expected to provide portfolio management services to the Silvia ETFs pursuant to sub-advisory

agreements with the Adviser and the ETF Trust, subject to the supervision and oversight of the Adviser and the Fund Board.

Failure, disruption,

insolvency, regulatory issue or termination involving the Adviser, the ETF Trust, or their service providers could disrupt or delay the

operations of the Silvia ETFs and adversely affect our ETF business.

Under the Investment Company Act, each sub-advisory

agreement must be approved by the Fund Board, including a majority of the trustees who are not interested persons of the ETF Trust, must

be approved at least annually after an initial term of up to two years, terminates automatically upon assignment and may be terminated

without penalty by the Fund Board or by a vote of a majority of the applicable fund’s outstanding voting securities on not more

than 60 days’ written notice.

The ETF Trust and the Adviser have received exemptive relief permitting the Adviser, subject to approval

by the Fund Board and other conditions, to hire, replace or terminate unaffiliated sub-advisers and materially amend unaffiliated sub-advisory

agreements without obtaining the applicable Silvia ETF shareholder approval.

Silvia ETF shareholders will be required to receive notice

of a change in sub-adviser.

Accordingly, the Adviser and the Fund Board may replace the Sub-Adviser without the applicable Silvia ETF

shareholder vote, and the loss or non-renewal of the sub-advisory relationship could eliminate anticipated fee revenue.

The Fund Board owes fiduciary duties to the Silvia

ETFs and their shareholders, and not to the Company or our stockholders.

The Fund Board or the Adviser could decline to renew, terminate

or replace the Sub-Adviser, or seek different fee or service arrangements, in each case without our consent or regard to the interests

of the Company or its stockholders.

The loss, termination or non-renewal of a sub-advisory relationship, or a deterioration in our relationship

with the Adviser, could prevent us from earning, or materially reduce, anticipated sub-advisory fee revenue.

Serving as sub-adviser to registered investment

companies will require SEC registration of our advisory subsidiary and will subject us to additional regulation.

An investment adviser or sub-adviser to a registered

investment company generally must be registered with the SEC under the Investment Advisers Act of 1940 (the “Advisers Act”)

and may not rely on the exemptions from registration on which the Investment Manager currently relies in connection with our private fund

The Investment Manager expects to file Form ADV to register with the SEC, and its registration would need to be effective before

it may serve as sub-adviser to the Silvia ETFs.

An investment adviser’s registration generally becomes effective within 45 days

after it files Form ADV, unless the SEC institutes proceedings to determine whether registration should be denied.

Any delay in registration

could delay the launch of the Silvia ETFs.

Upon registration, the Sub-Adviser will be subject

to applicable requirements of the Advisers Act and to SEC examination authority and potential examinations, including fiduciary obligations,

compliance program requirements under Rule 206(4)-7, the marketing rule under Rule 206(4)-1, code of ethics and personal trading requirements,

books-and-records requirements, custody-related requirements, and periodic SEC examinations.

The Sub-Adviser is not expected to take physical

possession of the assets of any Silvia ETF, which are expected to be held by the ETF Trust’s custodian.

The Sub-Adviser also expects

to perform delegated responsibilities supporting the Silvia ETFs’ compliance with applicable Investment Company Act requirements,

including Rule 6c-11 (ETF operations and portfolio transparency), Rule 22e-4 (liquidity risk management), Rule 18f-4 (derivatives), Rule

2a-5 (fair valuation) and the Names Rule, in each case as and to the extent those responsibilities are allocated to it under the sub-advisory

In addition, the compensation received by the Sub-Adviser for its services would be subject to Section 36(b) of the Investment

Company Act, which imposes a fiduciary duty with respect to the receipt of compensation and may be enforced through private litigation.

Compliance with these requirements will require

additional expenditure and personnel and will expand our regulatory examination and enforcement exposure, and any failure to comply could

result in fines, censures, disgorgement, limitations on our activities, suspension or revocation of registration and reputational harm.

The material weakness in our internal control over financial reporting described in Part I, Item 4 of this Quarterly Report has not been

remediated and may complicate the buildout of the financial-reporting and compliance processes required to support the proposed ETF business.

Registration under the Advisers Act applies at

the adviser level and is not limited to the Investment Manager’s activities as Sub-Adviser to the Silvia ETFs.

Upon registration,

the Investment Manager’s advisory activities with respect to the Funds, including the Initial Fund, will also become subject to

the Advisers Act, including the marketing rule, the custody rule, the compliance rule, books-and-records and reporting requirements and

SEC examination authority.

Compliance with these requirements with respect to our existing private fund business will require additional

expenditure and personnel and may require changes to our existing marketing materials, valuation practices, expense allocation practices

and fund documentation.

Certain proposed Silvia ETFs reference third-party

individuals, companies and publications that have not sponsored or endorsed the funds, which exposes us to intellectual property, right-of-publicity

and regulatory risks, including potential forced renaming.

Certain of the proposed Silvia ETFs are

expected to be named for, or to employ investment strategies based on public statements by or public information about, third

parties, including prominent business executives, the companies they lead, and investment ideas published by Opening Bell Daily,

LLC’s (“ the Opening Bell”) Best Ideas Club.

Except as described under “Our ETF business presents actual and

potential conflicts of interest” below with respect to the license from the Opening Bell, none of the referenced individuals

or entities sponsors, endorses, manages or participates in the Silvia ETFs.

A license to use content or other intellectual property

does not mean that the licensor sponsors or endorses a fund.

These individuals or entities, or persons acting

on their behalf, could assert claims based on rights of publicity, trademark, unfair competition, false endorsement or similar theories,

object publicly to the funds, or take actions, including changes in their public activities, roles or communications, that impair the

relevant fund’s strategy or viability.

Defending such claims could be costly regardless of merit, and an adverse outcome, SEC staff

comment or third-party objection could require the renaming, restructuring or abandonment of one or more proposed Silvia ETFs.

In addition, strategies that rely on third-party

publications or public statements depend on the continued availability, timeliness, continuity and quality of that source material, none

of which we control.

A cessation, reduction, delay or change in the relevant content, the termination or narrowing of any applicable license,

or a dispute regarding permitted use of transcripts, datasets or other materials could force changes to, or the closure of, the affected

Our ETF business presents actual and potential

conflicts of interest, including conflicts arising from our Chief Executive Officer’s media activities and ownership interests and from

overlapping Bitcoin-related exposures.

Our Chief Executive Officer and Chairman, is

a co-founder of, and holds an ownership interest in, the Opening Bell, a financial media publisher, through Inflection Points, Inc.

On August 12,2026, the Sub-Adviser entered into a license agreement with the Opening Bell pursuant to which the Sub-Adviser licenses

the research service on which the investment universe of the Silvia Best Ideas ETF is based.

As the sole consideration for the

license, Sub Adviser will pay the Opening Bell an annual rate of 0.02% of the average daily net assets of the Silvia Best Ideas ETF

The Royalty shall accrue only with respect to periods during which this Agreement is in effect and the

Silvia Best Ideas ETF is operational.

The license was reviewed and approved by the Audit Committee in accordance with our related

person transaction policy.

Our Chief Executive Officer and Chairman does not receive any economic benefit from the license other

than indirectly through his ownership interest in Opening Bell.

This arrangement creates actual and

potential conflicts of interest, including with respect to the editorial independence of the underlying publication and the

possibility that our Chief Executive Officer’s media activities could be attributed to, or perceived as promoting, the

proposed Silvia ETFs.

In addition, the license arrangement and the operation and marketing of the Silvia Best Ideas ETF may increase

the visibility of, and lead to an increase in paid subscriptions to, the Opening Bell’s publications, which could provide

indirect benefits to our Chief Executive Officer through his ownership interests that are not reflected in the Royalty.

Our Chief Executive Officer regularly makes public

statements about markets, digital assets and individual companies through media channels, and one or more Silvia ETFs may hold, purchase

or sell securities of companies that are the subject of those statements.

An investment adviser that publicly recommends a security in

which it or its clients hold a position, or in which it intends to transact, without adequate disclosure may violate the anti-fraud provisions

of the Advisers Act.

Coordinating the timing and content of our Chief Executive Officer’s public commentary with the trading activity

of the Silvia ETFs, the Funds and our own treasury operations will require policies, information barriers and pre-clearance procedures

that we have not previously been required to maintain.

Any failure of those procedures, or any allegation that our Chief Executive Officer’s

commentary was used to influence the price of a security held by a Silvia ETF, by a Fund or by us, could result in SEC enforcement action,

private litigation, termination of the sub-advisory agreements and substantial reputational harm.

In addition, we hold Bitcoin as a long-term treasury

reserve asset, the Investment Manager advises the Funds and, through the Silvia ETFs, the Sub-Adviser expects to provide sub-advisory

services to registered funds that may invest in Bitcoin-related equities, including investing in other bitcoin treasury companies.

Company Act restrictions may prohibit one or more Silvia ETFs from investing in our securities or securities of certain other entities

affiliated with us or the Sub-Adviser, including the Silvia Bitcoin mNAV Discount ETF and any other Silvia ETF that invests in bitcoin

treasury companies.

As a result, such securities may be excluded from the eligible investment universe of the applicable Silvia ETF even

if they otherwise satisfy its investment criteria, which could cause that fund’s portfolio to differ from the portfolio that its

stated methodology or investment process would otherwise produce.

Those restrictions may also limit the investment universe otherwise

available to a Silvia ETF, including with respect to other bitcoin treasury companies that are affiliated with us, and may cause a fund’s

portfolio to differ from the portfolio its stated methodology would otherwise produce.

Notwithstanding those restrictions, our corporate

treasury activities, the Funds and the Silvia ETFs may transact in the same or related issuers, instruments or Bitcoin-related exposures,

creating conflicts relating to the allocation of investment opportunities, the timing of transactions and the use and control of material

nonpublic information.

Our policies and procedures may not identify or mitigate every conflict, and actual or perceived failures to manage

these conflicts could result in regulatory scrutiny or action, litigation, investor outflows or redemptions and reputational harm.

Revenues from our ETF business will depend

on AUM and fee rates, will fluctuate with market prices, including the price of Bitcoin, and may increase the correlation of our results

to digital asset markets.

Any sub-advisory fees we earn are expected to

be calculated as a percentage of the average daily net assets of each Silvia ETF’s AUM and paid out of the Adviser’s unitary

management fee.

The Company would not receive sub-advisory fees directly;

those economics would be earned by the Investment Manager, our

wholly-owned subsidiary, and would be reflected in our consolidated results.

AUM, and therefore our fee revenue, will fluctuate with market

prices, investment performance and creations and redemptions of fund shares, and could decline rapidly during market downturns.

Several of the proposed Silvia ETFs are expected

to have substantial exposure to Bitcoin-related equities or other volatile assets.

Because we also hold Bitcoin directly as a treasury

reserve asset, a decline in the price of Bitcoin could simultaneously reduce the fair value of our digital asset holdings, the AUM and

related fee revenue of the Silvia ETFs and demand for our other products, compounding the effect of digital asset market volatility on

our results of operations.

Poor investment performance by any Silvia ETF could also cause outflows, damage the Silvia brand across our

consumer platform and other business lines and impair our ability to launch future products.

A registered fund is generally required to

have a net worth of at least $100,000 before it may make a public offering of its shares, and each Silvia ETF will therefore require seed

We anticipate that third parties will provide seed capital for each Silvia ETF, however, we or our affiliates may provide seed

capital to the Silvia ETFs.

Any seed capital we provide will be exposed to the relevant fund’s investment performance, may be illiquid,

will not be available for our existing operations or other corporate purposes, and could require us to consolidate the fund in our financial

statements for so long as our ownership remains controlling, which would increase the reported size, complexity and volatility of our

balance sheet and results of operations.

The proposed Silvia ETFs are expected to

employ novel and complex investment strategies, which increase operational, valuation, liquidity and compliance risks for which the Sub-Adviser

may be responsible.

The proposed Silvia ETFs are expected to employ

novel, actively managed strategies, each of which presents the strategy-specific risks described below.

These strategies collectively

present heightened risks relating to the valuation of illiquid or hard-to-value assets, compliance with the Investment Company Act limits

on illiquid investments and each fund’s liquidity risk management program, derivatives risk management and counterparty exposure,

methodology design and execution errors, and market-price deviations from net asset value and impaired arbitrage in fund shares.

each proposed Silvia ETF is expected to be non-diversified, which means that the underperformance of a small number of positions could

disproportionately reduce a fund’s AUM and our related fee revenue.

The nature and allocation of valuation, liquidity, derivatives

and compliance responsibilities will depend on the final governing agreements and applicable fund policies.

Operational, trading or valuation errors or compliance

failures by the Sub-Adviser could result in reimbursement obligations, regulatory sanctions, litigation, termination of the sub-advisory

agreements and reputational harm, and we may incur liabilities that are not covered by indemnification or insurance.

The Sub-Adviser will

owe fiduciary duties to the Silvia ETFs under the Advisers Act, and its compensation arrangements may be subject to claims under Section

36(b) of the Investment Company Act, in each case as applicable.

The proposed Silvia Anti-Money Printer ETF’s

multi-theme strategy exposes the fund, and our related fee revenue, to risks specific to each of its investment categories, including

reputational and distribution risks associated with the firearms industry.

The proposed Silvia Anti-Money Printer ETF is

expected to allocate its assets among four investment sleeves, including productive land, firearms and ammunition, Bitcoin miners, Bitcoin

exchange-traded products, Bitcoin exposure, gold exchange-traded products, gold miners and gold exposure.

Each sleeve presents distinct

risks, and the fund’s allocations among sleeves may vary over time.

The fund is expected to obtain exposure to these sleeves through

securities and other instruments permitted for a registered investment company rather than through direct ownership of the underlying

Land-related issuers, including REITs and royalty companies, are sensitive to interest rates, commodity and land prices and real

estate market conditions, and any investment in publicly traded partnerships would present additional tax and liquidity considerations.

Issuers and instruments providing Bitcoin-related exposure are subject to the digital asset market risks described elsewhere in this Item

1A, and gold-related issuers and instruments are sensitive to gold prices, production costs and operational and geopolitical developments.

The fund’s firearms and ammunition exposure

also presents risks to us.

Firearms and ammunition manufacturers, suppliers and retailers are subject to extensive and changing federal,

state and local regulation, litigation risk and significant political and social controversy.

In addition, certain broker-dealers, distribution

platforms, model-portfolio providers and institutional investors restrict or decline to offer, recommend or hold funds with firearms exposure,

and the fund may become subject to similar restrictions.

Restrictions of that kind could limit the fund’s distribution and reduce

its AUM, and the fund’s association with the firearms industry could subject the Silvia brand, our consumer platform and our other

business lines to negative publicity, boycotts or the loss of commercial relationships, whether or not the fund itself performs as intended.

The proposed Silvia Best Ideas ETF’s

investment universe is defined by a single third-party research publication, and the fund invests in ideas only after they have been publicly

disseminated.

The proposed Silvia Best Ideas ETF is

expected to select investments from single-stock ideas published in the Best Ideas Club, a subscription research service of the

Opening Bell, pursuant to the license arrangement described under “Our ETF business presents actual and potential

conflicts of interest” above.

The fund’s investment universe would therefore depend on the volume, quality and

continuity of ideas published by a single publication that we do not control.

If the Best Ideas Club publishes fewer ideas, changes

its format or editorial approach, or ceases publication, or if the applicable license is terminated or narrowed, the fund may be

unable to implement its strategy and may be required to change its strategy or close.

In addition, because investment ideas are

published to the Best Ideas Club’s subscribers before the fund is able to trade, market prices may already reflect the

published idea by the time the fund establishes a position, and other market participants may trade ahead of, alongside or against

The investors whose ideas are featured owe no duty to the fund, may hold economic interests or hedges that differ from

their published views, and may exit or reverse a position without timely public disclosure.

The fund’s general 12-month target

holding period may also cause it to continue to hold positions after the originating thesis is no longer current.

Underperformance

attributable to these features could cause outflows or the closure of the fund and, because of our Chief Executive Officer’s

ownership interest in the Opening Bell, could attract disproportionate scrutiny of the related license arrangement and of our

management of the associated conflicts of interest.

The proposed Silvia Bitcoin mNAV Discount

ETF’s methodology may not identify undervalued issuers, and its investable universe is limited, concentrated and composed of smaller,

less liquid issuers.

The proposed Silvia Bitcoin mNAV Discount ETF

is expected to invest in Bitcoin treasury companies whose fully diluted market capitalization is below the value of their Bitcoin holdings,

based on a market-to-net-asset-value methodology.

A discount of this kind describes a mathematical relationship and does not mean that

an issuer’s securities are undervalued or that they will appreciate.

Discounts may persist or widen for extended periods, including

because of an issuer’s leverage, capital structure, governance, operating losses or limited liquidity, and issuers trading at a

discount may continue to underperform notwithstanding the methodology’s screening criteria.

The fund’s eligibility thresholds are expected

to permit investment in small- and micro-capitalization issuers with limited trading volume, which present heightened volatility, liquidity

and transaction cost risks, and the universe of eligible Bitcoin treasury companies is limited and may contract as a result of acquisitions,

delistings, changes in issuer treasury strategies or a broader loss of investor interest in the Bitcoin treasury company model.

mandatory removal triggers may require sales at disadvantageous times or prices, and the fund is expected to have a high portfolio turnover

rate, which increases transaction costs.

In addition, because we have adopted a Bitcoin treasury strategy and hold Bitcoin as a long-term

treasury reserve asset, underperformance of the fund or adverse developments affecting Bitcoin treasury companies generally could be perceived

as reflecting on the viability of our own Bitcoin treasury strategy, compounding the reputational and financial effects on the Company

beyond the loss of fee revenue.

The proposed Silvia Elon ETF concentrates

its exposure in companies associated with a single individual and may hold private investments and derivatives that present valuation,

liquidity and counterparty risks.

The proposed Silvia Elon ETF is expected to

concentrate its exposure in companies founded, managed or controlled by a single individual, Elon Musk, the Chief Executive Officer of

Space Exploration Technologies Corp.

The values of these companies may be highly correlated, and developments involving Mr.

Musk, including

death, incapacity, litigation, regulatory action, reputational events or changes in his roles, holdings or public activities, could cause

simultaneous declines across the fund’s portfolio.

In addition, a change in Mr.

Musk’s relationship with an issuer could cause

the issuer to cease to satisfy the fund’s qualification criteria, requiring the fund to dispose of, or terminate derivatives referencing,

the position at disadvantageous times or prices.

The fund also may obtain exposure through total return swaps and other derivatives, which

present counterparty credit risk and may require the fund to hold significant cash and cash equivalents as collateral, which may create

a drag on performance.

Because a Silvia ETF may hold privately held companies

and related instruments in an amount approaching the 15% limit on illiquid investments imposed by Rule 22e-4 under the Investment Company

Act, changes in the value of the fund’s liquid holdings, redemption activity or a reclassification of an investment’s liquidity

could cause the fund to exceed that limit without any purchase by the Sub-Adviser.

Exceeding the limit would require reporting to the

Fund Board and to the SEC and could require the fund to dispose of investments at disadvantageous prices, and repeated or prolonged breaches

could result in regulatory action against, or termination of, the Sub-Adviser.

In addition, investments in privately held companies and

special purpose vehicles may also be subject to contractual restrictions on transfer or disclosure, may not be eligible to be transferred

in-kind in connection with creations or redemptions, and may require the relevant ETF to use cash transactions.

These features could increase

transaction costs, taxable gains, valuation uncertainty and dilution and could impair the arbitrage mechanism for the ETF’s shares.

Investments through special purpose vehicles may also expose the ETF to additional fees and expenses and may provide the ETF with fewer

voting, information, governance or other rights than it would have if it held the underlying investment directly.

Privately held investments are also hard to value,

and the Sub-Adviser’s valuation-related responsibilities with respect to these investments present a heightened risk of valuation

errors, which could result in reimbursement obligations, regulatory action or litigation for which we may be responsible.

The proposed Silvia Jensen Interview ETF’s

investment process depends on the continued availability, and the Sub-Adviser’s interpretation, of public statements by a single

The proposed Silvia Jensen Interview ETF is

expected to select investments based on the Sub-Adviser’s analysis of a corpus of broadly disseminated public statements by a single

executive, Jensen Huang, the Chief Executive Officer of NVIDIA, during rolling monthly periods.

The strategy depends on the continued

volume, frequency and substance of Mr.

Jensen’s public commentary, none of which we control.

Jensen reduces or ceases public

commentary, changes roles, or becomes subject to restrictions on his public statements, the corpus may contain few or no qualifying statements,

the fund’s portfolio may become less representative of its stated strategy, and the fund may be required to change its strategy

The Sub-Adviser will exercise judgment in determining

whether a public statement reflects an investment view relevant to the fund and whether, when and to what extent to implement that view.

The Sub-Adviser is not required to purchase or sell a security solely because Mr.

Jensen has made a statement concerning the security,

its issuer or a related investment.

Public statements may be ambiguous, incomplete, hypothetical, humorous, subsequently edited, deleted,

clarified or withdrawn, and the Sub-Adviser may interpret a statement differently from other market participants.

Errors or delays in

identifying, transcribing, attributing or interpreting public statements, including because of third-party data, social-media or technology

failures, could cause the fund to make investment decisions that differ from those that would have been made if complete and accurate

information had been available.

In addition, the fund is expected to concentrate

in semiconductor, artificial intelligence infrastructure and related sectors, the values of which may be highly correlated with one another

and with developments affecting a small number of large technology companies.

A downturn in these sectors, or execution errors in the

corpus methodology, could reduce the fund’s AUM and our related fee revenue and expose the Sub-Adviser to claims relating to the

design or implementation of the fund’s investment process.

Our ETF business will depend on a limited

number of investment professionals who also support our other businesses.

Pompliano is expected to be identified in

the registration statement as the portfolio manager of the Silvia ETFs.

He is expected to be responsible for the Silvia ETFs, the Funds

and our corporate treasury activities, and Mr.

Pompliano also serves as our Chief Executive Officer and Chairman and as the Initial Fund’s

Managing registered investment companies requires daily portfolio management, trading, liquidity classification, valuation

and compliance testing, and the addition of five registered portfolios will substantially increase the demands on this professional.

Competition for experienced personnel qualified

to manage registered funds is significant, and we may be unable to recruit or retain the investment, compliance, operations and valuation

professionals the ETF business will require.

The departure, incapacity or reduced availability of any of these professionals, or a determination

by the Adviser or the Fund Board that our resources are insufficient to support the Silvia ETFs, could result in the termination or non-renewal

of the sub-advisory agreements, and could simultaneously disrupt the Funds, our corporate treasury activities and our other business lines.

Adverse developments involving the Silvia

ETFs could damage our brand and other business lines even where we are not responsible for the underlying event.

The proposed Silvia ETFs are expected to use the

Silvia name, which is central to our consumer platform.

Poor performance, fund closures, regulatory matters, litigation, disputes involving

referenced third parties or negative publicity involving any Silvia ETF, the ETF Trust, the Adviser or their service providers may be

attributed to us even if we did not cause the event or are not legally responsible for the resulting loss, and could damage our reputation,

our consumer platform, our asset management business and our ability to raise capital, in each case disproportionately to the financial

significance of the underlying event.

This Quarterly Report is not an offer to sell

or the solicitation of an offer to buy shares of any Silvia ETF, and shall not constitute an offer, solicitation or sale in any jurisdiction

in which such offer, solicitation or sale would be unlawful.

Any offering of shares of a Silvia ETF will be made only by means of a prospectus.

We are not the issuer of, and do not offer, shares of any Silvia ETF.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors