What changed in this filing

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Item 1A. Risk Factors

2025-04-15 compared with 2024-04-01 · 134 added, 65 removed, 777 unchanged (20% of the section changed)

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may not achieve profitability.

Our net loss for the year ended December 31, 2023

was $22.9 million.

Our net loss for the year ended December 31, 2024 was $14.7 million.

Our accumulated deficit was $223.4 million as of December 31, 2024.

Our ability to become profitable depends upon our

ability to generate revenue from our financial products and services.

We do not know when, or if, we will generate significant revenue

from such financial services and products.

Even though our revenue may increase, we expect to incur significant additional losses while

we grow and expand our business.

Our ability to become profitable depends upon our ability to generate

revenue from our financial products and services.

We do not know when, or if, we will generate significant revenue from such financial

services and products.

Even though our revenue may increase, we expect to incur significant additional losses while we grow and expand

our business.

We cannot predict if and when we will achieve profitability.

Our failure to achieve and sustain profitability

could negatively impact the market price of our common stock.

Our failure to achieve and sustain profitability could negatively

impact the market price of our common stock.

If we cannot meet

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stock price may decline.

Our assessment, testing and evaluation of the design

and operating effectiveness of our internal control over financial reporting resulted in our conclusion that, as of December 31, 2023,

our internal control over financial reporting was not effective, due to the design and maintenance of fair value reporting relating to

certain notes receivable.

Our assessment, testing and evaluation of the

design and operating effectiveness of our internal control over financial reporting resulted in our conclusion that, as of December 31,

2024, our internal control over financial reporting was not effective, as described further in Item 9A of this Form 10-K for the fiscal

year ended December 31, 2024.

We can provide no assurance as to conclusions of management with respect to the effectiveness of our internal

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business, financial condition and liquidity.

enacted and proposed to enact significant new tariffs.

Additionally, President Trump has directed various federal agencies to further

evaluate key aspects of U.S.

trade policy and there has been ongoing discussion and commentary regarding potential significant changes

trade policies, treaties and tariffs.

There continues to exist significant uncertainty about the future relationship between the

and other countries with respect to such trade policies, treaties and tariffs.

These developments, or the perception that any of

them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets.

Uncertain or unfavorable

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conflicts of interest could damage our reputation and adversely affect our business.

Appropriately

dealing with conflicts of interest is complex and difficult and our reputation could be damaged if we fail, or appear to fail, to deal

appropriately with one or more potential or actual conflicts of interest.

It is possible that potential or perceived conflicts could give

rise to investor dissatisfaction or litigation or regulatory enforcement actions.

In addition, regulatory scrutiny of, or litigation in

connection with, conflicts of interest would have a material adverse effect on our reputation, which could materially and adversely affect

our business in a number of ways, including an inability to raise additional funds, a reluctance of counterparties to do business with

us and the costs of defending litigation.

Appropriately dealing with conflicts of

interest is complex and difficult and our reputation could be damaged if we fail, or appear to fail, to deal appropriately with one or

more potential or actual conflicts of interest.

It is possible that potential or perceived conflicts could give rise to investor dissatisfaction

or litigation or regulatory enforcement actions.

In addition, regulatory scrutiny of, or litigation in connection with, conflicts of interest

would have a material adverse effect on our reputation, which could materially and adversely affect our business in a number of ways,

including an inability to raise additional funds, a reluctance of counterparties to do business with us and the costs of defending litigation.

Our results of

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affect the Company’s revenue and its ability to borrow in the credit markets.

As a holding company,

we are dependent on liquidity from payments from our subsidiaries, many of which are subject to restrictions.

As a holding company,

we depend on dividends, distributions and other payments from our subsidiaries to fund payments on our obligations.

Several of our subsidiaries,

particularly our broker-dealer subsidiary, are subject to regulations that limit or restrict dividend payments or reduce the availability

of the flow of funds from those subsidiaries to us.

In addition, our broker-dealer subsidiaries subsidiary are subject to restrictions

on their ability to lend or transact with affiliates and are required to maintain minimum regulatory capital requirements.

These regulations

may hinder our ability to access funds that we may need to make payments to fulfill obligations.

Liquidity is essential

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may limit our ability to generate liquidity quickly through the disposition of the underlying investment while the agreement is effective.

We face increasing

competition in the financial services industry.

We operate in an intensely

competitive industry with other global bank holding companies that engage in investment banking and capital markets activities as one

of their lines of business and that have greater capital and resources than we do.

We also compete against other broker-dealers, asset

managers and boutique firms.

There is also growing pressure to provide services at lower fees to appeal to clients, which may impact our

ability to effectively compete.

We are subject

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In addition to personnel dedicated to overseeing the infrastructure and systems to defend against cybersecurity incidents, senior management

is regularly briefed on issues, preparedness and any incidents requiring response.

At its regularly scheduled meetings, the Board of Directors

is briefed and brought up to date on cybersecurity matters.

and our designated member of the Board of Directors are regularly briefed on issues, preparedness and any incidents requiring response.

The Company continually

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operations may be adversely affected .

Many aspects of

the Company’s business involve substantial risks of liability.

An underwriter is exposed to substantial liability under federal

and state securities laws, other federal and state laws, and court decisions, including decisions with respect to underwriters’

liability and limitations on indemnification of underwriters by issuers.

For example, a firm that acts as an underwriter may be held

liable for material misstatements or omissions of fact in a prospectus used in connection with the securities being offered or for statements

made by its securities analysts or other personnel.

The Company’s underwriting activities will usually involve offerings of the

securities of smaller companies, which often involve a higher degree of risk and are more volatile than the securities of more established

In comparison with more established companies, smaller companies are also more likely to be the subject of securities class

actions, to carry directors and officers liability insurance policies with lower limits or not at all, and to become insolvent.

in market downturns, claims tend to increase.

Each of these factors increases the likelihood that an underwriter may be required to contribute

to an adverse judgment or settlement of a securities lawsuit.

Many aspects of the Company’s

business involve substantial risks of liability.

An underwriter is exposed to substantial liability under federal and state securities

laws, other federal and state laws, and court decisions, including decisions with respect to underwriters’ liability and limitations

on indemnification of underwriters by issuers.

For example, a firm that acts as an underwriter may be held liable for material misstatements

or omissions of fact in a prospectus used in connection with the securities being offered or for statements made by its securities analysts

or other personnel.

The Company’s underwriting activities will usually involve offerings of the securities of smaller companies,

which often involve a higher degree of risk and are more volatile than the securities of more established companies.

In comparison with

more established companies, smaller companies are also more likely to be the subject of securities class actions, to carry directors and

officers liability insurance policies with lower limits or not at all, and to become insolvent.

In addition, in market downturns, claims

tend to increase.

Each of these factors increases the likelihood that an underwriter may be required to contribute to an adverse judgment

or settlement of a securities lawsuit.

The Company’s

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risk control practices, and, if found inadequate, bring enforcement actions and sanctions against such firms.

Our Bitcoin investment

strategy may expose us to various risks associated with Bitcoin.

investment strategy may expose us to various risks associated with Bitcoin, including the following.

Bitcoin is a highly volatile

asset that has traded below $38,000 per bitcoin and above $108,000 per bitcoin on Coinbase during 2024.

The trading price of bitcoin

was significantly lower during prior periods, and such decline may occur again in the future.

Bitcoin ETFs may not

pay dividends and we may only be able to generate cash from our Bitcoin ETF holdings if we sell our bitcoin ETF holdings or implement

strategies to create income streams.

Even if we pursue any such strategies, we may be unable to create income streams or otherwise generate

cash from our Bitcoin ETF holdings, and any such strategies may subject us to additional risks.

This Bitcoin ETF investment

strategy has not been tested.

Although we believe Bitcoin, due to its limited supply, has the potential to serve as a hedge against inflation

in the long term, the short-term price of Bitcoin declined in recent periods during which the inflation rate increased.

Some investors

and other market participants may disagree with our Bitcoin ETF investment strategy or actions we undertake to implement it.

prices were to decrease or our Bitcoin ETF investment strategy otherwise proves unsuccessful, our financial condition, results of operations,

and the market price of our common stock may be adversely impacted.

Bitcoin and other digital

assets are relatively novel and are subject to significant uncertainty, which could adversely impact their price.

The application of state

and federal securities laws and other laws and regulations to digital assets is unclear in certain respects, and it is possible that regulators

in the United States or foreign countries may interpret or apply existing laws and regulations in a manner that adversely affects the

price of Bitcoin.

Moreover, the risks of engaging in a Bitcoin ETF investment strategy are relatively novel and have created, and could

continue to create, complications due to the lack of experience that third parties have with companies engaging in such a strategy, such

as increased costs of director and officer liability insurance or the potential inability to obtain such coverage on acceptable terms

in the future.

The growth of the digital assets industry in general, and the use and acceptance of Bitcoin in particular, may also impact

the price of Bitcoin and is subject to a high degree of uncertainty.

The pace of worldwide growth in the adoption and use of Bitcoin may

depend, for instance, on public familiarity with digital assets, ease of buying, accessing or gaining exposure to Bitcoin, institutional

demand for Bitcoin as an investment asset, the participation of traditional financial institutions in the digital assets industry, consumer

demand for Bitcoin as a means of payment, and the availability and popularity of alternatives to Bitcoin.

Even if growth in Bitcoin adoption

occurs in the near or medium-term, there is no assurance that Bitcoin usage will continue to grow over the long-term.

Risks Associated with

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but are not limited to:

● developments

regarding regulatory filings;

funding requirements and the terms of our financing arrangements;

● introduction

of new technologies by us or our competitors;

regulations and laws;

sentiment relating to our industry;

number of shares issued and outstanding;

number of shares trading on an average trading day;

sales of our shares by stockholders to whom we have sold stock in private placements, or the cessation of transfer restrictions with

respect to those shares;

speculation regarding any of the foregoing.

developments regarding regulatory filings;

our funding requirements and the terms of our financing arrangements;

introduction of new technologies by us or our competitors;

government regulations and laws;

public sentiment relating to our industry;

the number of shares issued and outstanding;

the number of shares trading on an average trading day;

block sales of our shares by stockholders to whom we have sold stock in private placements, or the cessation of transfer restrictions with respect to those shares;

market speculation regarding any of the foregoing.

Our shares of common stock are thinly traded

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company such as ours or purchase or recommend the purchase of our shares until such time as we become more seasoned and viable.

volumes may have been further adversely affected by the 17-for-1 reverse stock split that was effective as of June 7, 2022.

we believe that due to the limited number of shares of our common stock outstanding, an options market has not been established for our

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or be sustained, or that current trading levels will be sustained.

Our stock price and trading volume could

decline as a result of inaccurate or unfavorable research, or the cessation of research cover, about our business published by securities

or industry analysts.

Our stock price

and trading volume could decline as a result of inaccurate or unfavorable research, or the cessation of research cover, about our business

published by securities or industry analysts.

The trading market for

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Law (the “DGCL”), could delay or prevent a third party from acquiring us or replacing members of our Board of Directors, or

make more costly any attempt to acquire control of the Company, even if the acquisition or the Board designees would be beneficial to

our stockholders.

These factors could also reduce the price that certain investors might be willing to pay for shares of the common stock

and result in the market price being lower than it would be without these provisions.

make more costly any attempt to acquire control of the Company, even if the acquisition or the Board of Directors designees would be beneficial

to our stockholders.

These factors could also reduce the price that certain investors might be willing to pay for shares of the common

stock and result in the market price being lower than it would be without these provisions.

We incur increased costs as a result

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from making a tender offer or otherwise attempting to obtain control of our company.

Dividends on our common stock are not likely.

During the last five years, we have not paid cash

dividends on our common stock, and we do not anticipate paying cash dividends on our common stock in the foreseeable future.

must look solely to the potential for appreciation in the market price of the shares of our common stock to obtain a return on their investment.

There is no assurance that we will continue

to declare or pay dividends on our common stock in the future.

On February 11, 2025, we declared a special cash

dividend on our common stock and pursuant to the terms of certain common stock purchase warrants issued in our recently completed financings

(on an as-exercised basis) of $0.32 per share, which was paid on March 3, 2025, to shareholders and certain warrant holders of record

as of the close of business on February 24, 2025.

However, there is no assurance that we will continue to declare or pay cash dividends

in the future.

Any future dividend payments are within the discretion of our Board of Directors and will depend upon, among other things,

our results of operations, financial condition, level of indebtedness, working capital requirements, capital expenditure requirements,

any contractual restrictions with respect to payment of dividends, business opportunities, anticipated cash needs, provisions of applicable

law, and other factors that our Board of Directors may deem relevant.

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-K

Item 1A. Risk Factors