What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-05-16 compared with 2021-11-12 · 201 added, 335 removed, 2 unchanged (100% of the section changed)

Management’s Discussion and Analysis

of Financial Condition and Results of Operations

Forward-Looking Statements

The information in this report

contains forward-looking statements.

All statements other than statements of historical fact made in this report are forward looking.

In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking

These forward-looking statements can be identified by the use of words such as “believes,” “estimates,”

“could,” “possibly,” “probably,” anticipates,” “projects,” “expects,”

“may,” “will,” or “should” or other variations or similar words.

No assurances can be given that the

future results anticipated by the forward-looking statements will be achieved.

Forward-looking statements reflect management’s current

expectations and are inherently uncertain.

If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, our

actual results may differ significantly from management’s expectations.

These risks and uncertainties include those factors described

in greater detail in the risk factors disclosed in our Form 10-K for the fiscal year ended December 31, 2020 filed with the Securities

and Exchange Commission.

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect,

actual results may vary in material respects from those anticipated in these forward-looking statements.

The Company undertakes no

obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except

as may be required under applicable securities laws.

You are cautioned not to place

undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q or, in the case

of documents referred to or incorporated by reference, the date of those documents.

The following discussion and

analysis should be read in conjunction with our unaudited financial statements, included herewith.

This discussion should not be construed

to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily

be indicative of actual operating results in the future.

Such discussion represents only the best present assessment of our management.

Company Overview and Description of Business

We were incorporated in the

State of Delaware on November 18, 2004 for the purpose of merging with OLB.com.

The merger was done for the purpose of changing our state

of incorporation from New York to Delaware.

In April 2018, we completed an acquisition of substantially all of the net assets of Excel

and its subsidiaries Payprotec Oregon, LLC, Excel Business Solutions, Inc.

and eVance Processing, Inc.

(such assets are the foundation

of our eVance business).

In May 2018, we entered into share exchange agreements with Crowdpay and Omnisoft, affiliate companies of our

company’s majority stockholder, pursuant to which each of Crowdpay and Omnisoft became solely owned subsidiaries of our Company.

Our Company’s headquarters is located at 200 Park Avenue, Suite 1700, New York, NY 10166.

Our telephone number is (212) 278-0900.

We are a FinTech company and

PayFac that focuses on a suite of products in the merchant services and payment facilitator verticals that seeks to provide integrated

business solutions to merchants throughout the United States.

We seek to accomplish this by providing merchants with a wide range

of products and services through our various online platforms, including financial and transaction processing services.

We also have products

that provide support for crowdfunding and other capital raising initiatives.

We supplement our online platforms with certain hardware

solutions that are integrated with our online platforms.

Our business functions primarily through three wholly-owned subsidiaries,

eVance, OmniSoft, and CrowdPay, though substantially all of our revenue has been generated from our eVance business (we began generating

revenue from our OmniSoft and CrowdPay businesses in the second half of 2019).

We expect to build out our OmniSoft software business and

to rely more on our PayFac model for revenue so that we are not dependent on our revenue from our eVance business but there is no guarantee

that we will be able to do so.

With respect to our eVance

business, our merchants are currently processing over $82,000,000 in gross transactions monthly and average approximately 1,400,000 transactions

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking

information in this report contains forward-looking statements.

All statements other than statements of historical fact made in this

report are forward looking.

In particular, the statements herein regarding industry prospects and future results of operations or financial

position are forward-looking statements.

These forward-looking statements can be identified by the use of words such as “believes,”

“estimates,” “could,” “possibly,” “probably,” anticipates,” “projects,”

“expects,” “may,” “will,” or “should” or other variations or similar words.

No assurances

can be given that the future results anticipated by the forward-looking statements will be achieved.

Forward-looking statements reflect

management’s current expectations and are inherently uncertain.

If underlying assumptions prove inaccurate or unknown risks or

uncertainties materialize, our actual results may differ significantly from management’s expectations.

These risks and uncertainties

include those factors described in greater detail in the risk factors disclosed in our Form 10-K for the fiscal year ended December 31,

2021 filed with the Securities and Exchange Commission.

Should one or more of these risks or uncertainties materialize, or should any

of our assumptions prove incorrect, actual results may vary in material respects from those anticipated in these forward-looking statements.

Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events

or otherwise, except as may be required under applicable securities laws.

are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report

on Form 10-Q or, in the case of documents referred to or incorporated by reference, the date of those documents.

following discussion and analysis should be read in conjunction with our unaudited financial statements, included herewith.

This discussion

should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion

reached herein will necessarily be indicative of actual operating results in the future.

Such discussion represents only the best present

assessment of our management.

Overview and Description of Business

are a FinTech company and PayFac that focuses on a suite of products in the merchant services and payment facilitator verticals that

seeks to provide integrated business solutions to merchants throughout the United States.

We seek to accomplish this by providing

merchants with a wide range of products and services through our various online platforms, including financial and transaction processing

We also have products that provide support for crowdfunding and other capital raising initiatives.

We supplement our online

platforms with certain hardware solutions that are integrated with our online platforms.

Our business functions primarily through three

wholly-owned subsidiaries, eVance, OmniSoft, and CrowdPay, though substantially all of our revenue has been generated from our eVance

business (we began generating revenue from our OmniSoft and CrowdPay businesses in the second half of 2019).

We expect to build out our

OmniSoft software business and to rely more on our PayFac model for revenue so that we are not dependent on our revenue from our eVance

business but there is no guarantee that we will be able to do so.

respect to our eVance business, our merchants are currently processing over $100,000,000 in gross transactions monthly and average approximately

1,400,000 transactions a month.

These transactions come from a variety of sources including direct accounts and ISO channels.

The accounts consist of businesses

across the United States with no concentration of industries or merchants.

We have integrated all the

applications for OmniSoft and the ShopFast Omnicommerce solution with the eVance mobile payment gateway, SecurePay.comTM.

SecurePay.comTM,

is currently used by approximately 3,000 merchants processing over 32,000 transactions and approximately $9,000,000 of monthly gross transactions

(though our revenue from these transactions is limited).

In July 2019, we launched a new merchant and ISO boarding system that will be

able to onboard merchants instantly.

This will provide the merchant with an automated approval and ISOs will have the ability to see all

their merchants and their residuals as they load to the system.

On May 22, 2020, the

Company purchased certain assets from POSaBIT Inc.

(“POSaBIT”), including its contracts and arrangements with the Doublebeam

merchant payment processing platform (the “POSaBIT Asset Acquisition”).

The assets included, but were not limited to, software

source codes, customer lists, customer contracts, hardware and website domains.

The total purchase price was $215,000 (the “Purchase

Price”) following post-closing adjustments.

On May 14, 2021, the Company

formed OLBit, Inc., a wholly owned subsidiary (“OLBit”).

The purpose of OLBit is to hold the Company’s assets and operate

its business related to cryptocurrency-related lending and transactional business.

On July 2, 2021, the Company signed a non-binding letter of intent

to acquire a portfolio of CBD and other merchants that will utilize the Company’s SecurePay Payment Gateway to process payments.

The group of merchants to be acquired have reported annual transaction volume of greater than $300 million.

The transaction is anticipated

to add an accomplished and experienced sales channel to the OLB team, enabling further penetration into this growing sector in the United

The transaction is expected to close in the fourth quarter of 2021 however there can be no assurance that the company will

close this acquisition.

On July 23, 2021, the Company formed DMINT, Inc., a wholly owned subsidiary

The purpose of DMINT is to operate its business related to cryptocurrency mining DMint has initiated the first

phase of the cryptocurrency mining operation by placing purchase orders for data centers and ASIC-based Antminer S19J Pro mining computers

specifically configured to mine Bitcoin.

The first lot of equipment will be used to establish a proof of concept before DMint expands

the number of computers in operation.

As configured, it is expected that the computers purchased will have a combined computing power

of approximately 100 petahash per second.

If the initial mining operation results are as anticipated, DMint plans to expand the number

of mining computers every quarter, whereby it would potentially have the computing power of 500 petahash per second by the end of 2022.

On October 25, 2021, the Board

approved entry by the Company into a share exchange agreement (“Agreement”) between the Company and all of the shareholders

of Crowd Ignition, Inc.

(“Crowd Ignition”) whereby the Company would purchase 100% of the equity of Crowd Ignition in exchange

for 1,318,408 shares of the common stock, par value $0.0001 of the Company (the “Shares”).

The value of the Shares was, for

purposes of the Agreement, based on the closing trading price of the Company on October 1, 2021 (the date on which a third-party fairness

opinion was issued), resulting in an aggregate purchase price for Crowd Ignition of $5.3 million.

Crowd Ignition is a web-based crowdfunding

software system.

Ronny Yakov, Chairman and CEO of the Company and John Herzog, a significant shareholder of the Company, own 100% of the

equity of Crowd Ignition.

The software provides broker-dealer, merchant banks and law firms a platform to market crowdfunding offerings,

collect payments and issue securities.

The software has been developed in response to, and to comply with, recent changes in investment

regulations including Regulation D 506(b) and 506(v), Regulation A+ and Title III of the Jobs Act (Regulation CF), including raising the

crowdfunding limit from $1.07 million to $5.0 million.

Crowd Ignition is one of only about 50 companies registered with the U.S.

and Exchange Commission (“SEC”) to provide the services permitted under Reg CF.

The transaction is expected to close by the

end of November 2021, subject to execution of the Agreement and customary closing conditions.

Results of Operations

Management’s discussion

and analysis of financial condition and results of operations (“MD&A”) includes a discussion of the consolidated results

from operations of The OLB Group, Inc.

and its subsidiaries for the three and nine months ended September 30, 2021 and 2020.

Three Months Ended September 30, 2021

Compared to the Three Months Ended September 30, 2020

For the three months ended September 30, 2021, we had total revenue

of $2,823,921 compared to $2,308,037 of revenue for the three months ended September 30, 2020, an increase of $551,233 or 22.4%.

$2,680,004 in transaction and processing fees, $32,787 in merchant equipment rental and sales and $111,130 in other revenue during the

three months ended September 30, 2021, compared to $2,128,771 in transaction and processing fees, $22,018 in merchant equipment sales

and $157,248 in other revenue during the three months September 30, 2020.

The increase in revenue was a result of an increase in the amount

of fees earned from merchant processing transactions and an increase in the number of rentals and sales of merchant equipment.

and servicing costs increased by $737,463 or 49.6%.

The increase was a result of the increase in the number of transactions processed

during the period.

Visa and Mastercard quarterly charges were higher than was accrued during the period.

This was due to an increase in

Also, revenue for software, DoubleBeam and the net merchant portfolio decreased.

There are no expenses related to these items.

A decrease in revenue related to these items does not directly correspond to a decrease in expense.

Amortization expense for the three months ended September 30, 2021

was $269,475 compared to $222,090 for the three months ended September 30, 2020, an increase of $47,385 or 21.3%.

We recorded amortization

expense on our merchant portfolio acquired in April 2018, trademarks and mineral rights acquired in August 2021.

Our amortization expense

increased in the current period due to the acquisition of mineral rights of natural gas.

Salary and wage expense for the three months ended September 30, 2021

was $326,776 compared to $318,682 for the three months ended September 30, 2020, an increase of $8,094 or 2.5%.

General and administrative expenses (“G&A”) for the

three months ended September 30, 2021 was $904,314 compared to $706,430 for the three months ended September 30, 2020, an increase of

$197,884 or 28%.

In the current period, the increases were primarily due to increases of legal expenses of approximately $270,003 relating

to ongoing litigation matters and legal advice relating to other Company business and was offset by a decrease of our auditor fees of

approximately $74,940 and stock based compensation of $156,843.

During 2021, the Company has expanded its public relations and marketing

campaigns to increase visibility in the investor community and merchant marketplace.

The Company has contracted with outside consultants

to perform the investor relations and marketing work.

It is anticipated that the Company will continue to use these services for the remainder

of 2021 and into 2022.

For the three months ended September 30, 2021, we incurred $0 of interest

expense, compared to $233,211 for the three months ended September 30, 2020, a decrease of $233,211.

The decrease in interest expense

is due the conversion of all related party debt and the repayment of the Term Loan in March 2021.

Our net loss for the three months ended September 30, 2021 was $900,351

compared to $657,358 for the three months ended September 30, 2020.

We had an increase in our net loss of $242,993 for the reasons discussed

Nine Months Ended September 30, 2021

Compared to the Nine Months Ended September 30, 2020

For the nine months ended September 30, 2021, we

had total revenue of $7,883,897 compared to $6,922,065 of revenue for the nine months ended September 30, 2020, an increase of $1,139,171

We earned $7,436,317 in transaction and processing fees, $98,190 in merchant equipment rental and sales and $349,390 in other

revenue from monthly recurring subscriptions, during the nine months ended September 30, 2021, compared to having earned $6,297,146 in

transaction and processing fees, $60,828 in merchant equipment rental and sales and $564,091 in other revenue from monthly recurring

subscriptions in the same period in the prior period.

The increase was a result of an increase in the amount of fees earned from merchant

processing transactions and an increase in the number of rentals and sales of merchant equipment.

For the nine months ended

September 30, 2021, we had processing and servicing costs of $5,869,739_ compared to $4,501,274 of processing and servicing costs for

the nine months ended September 30, 2020.

Processing and servicing costs increased by $1,368,465 or 30.4% because of the increase in the

number of transactions processed during the period.

Amortization expense for the nine months ended September 30, 2021 was

$701,282 compared to $628,519 for the nine months ended September 30, 2020, an increase of $72,763 or 11.5%.

We recorded amortization

expense on our merchant portfolio, trademarks and mineral rights.

Our amortization expense increased in the current period due to the

acquisition of mineral rights of natural gas.

Salary and wage expense for the nine months ended

September 30, 2021 was $1,483,570 compared to $1,036,068 for the nine months ended September 30, 2020, an increase of $447,502 or 43.2%.

Salary and wage expense increased in the current period due to bonuses paid to our CEO and President for the Company’s performance

in 2020 and 2021.

G&A expense for the nine months ended September

30, 2021 was $2,378,951 compared to $1,602,685 for the nine months ended September 30, 2020, an increase of $776,266 or 33.6%.

current period, the increases were primarily due to increases of legal expenses of approximately $682,000 relating to ongoing litigation

matters, legal costs relating to the prepayment of the Term Loan and attorney fees relating to other Company business.

This increase was

partially offset by a decrease in our audit fees of approximately $324,000 during the current period compared with the prior period.

For the nine months ended

September 30, 2021, we incurred $119,736 of interest expense, compared to $865,397 for the nine months ended September 30, 2020, a decrease

of $748,661 or 198%.

The decrease in interest expense is due to the conversion of all related party debt and the repayment of the Term

We also recognized a loss of $4,499,952 for the fair value of warrants that were issued.

Our net loss for the nine months ended September 30, 2021 was $2,666,347

compared to $1,709,974 for the nine months ended September 30, 2020.

consist of businesses across the United States with no concentration of industries or merchants.

have integrated all the applications for OmniSoft and the ShopFast Omnicommerce solution with the eVance mobile payment gateway, SecurePay.comTM.

SecurePay.comTM, is currently used by approximately 3,000 merchants processing over 32,000 transactions and approximately $9,000,000

of monthly gross transactions (though our revenue from these transactions is limited).

In July 2019, we launched a new merchant and ISO

boarding system that will be able to onboard merchants instantly.

This provides the merchant with an automated approval and ISOs will

have the ability to see all their merchants and their residuals as they load to the system.

May 22, 2020, the Company purchased certain assets from POSaBIT Inc.

(“POSaBIT”), including its contracts and arrangements

with the Doublebeam merchant payment processing platform (the “POSaBIT Asset Acquisition”).

The assets included, but were

not limited to, software source codes, customer lists, customer contracts, hardware and website domains.

May 14, 2021, the Company formed OLBit, Inc., a wholly owned subsidiary (“OLBit”).

The purpose of OLBit is to hold the Company’s

assets and operate its business related to its emerging cryptocurrency-related lending and transactional business.

July 23, 2021, we formed DMINT, Inc., a wholly owned subsidiary (“DMINT”) to operate in the cryptocurrency mining industry.

DMINT has initiated the first phase of the cryptocurrency mining operation by placing purchase orders for data centers and ASIC-based

Antminer S19J Pro mining computers specifically configured to mine Bitcoin.

The first lot of equipment is being used to establish a proof

of concept before DMINT expands the number of computers in operation.

As of March 31, 2022, DMint has purchased 1,000 computers, of which

650 computers have been delivered with 250 online and mining for Bitcoin, 400 computers are in process of being installed and 350 additional

computers are scheduled for delivery in 2022.

It has six data centers located in Pennsylvania where it has mined ten Bitcoin.

entered into an exclusive agreement whereby it has rights to all of the natural gas produced by 15 mines in Bradford, Pennsylvania.

natural gas is taken directly from the well heads to generate electricity required to power the mining computers.

As configured, it is

expected that the computers purchased will have a combined computing power of approximately 100 petahash per second.

If the initial mining

operation results are as anticipated, DMINT plans to expand the number of mining computers every quarter, whereby it would aim to have

the computing power of 500 petahash per second by the end of 2022.

January 3, 2022, the Company entered into a share exchange agreement with all of the shareholders of Crowd Ignition, Inc.

Ignition”) whereby the Company purchased 100% of the equity of Crowd Ignition in exchange for 1,318,408 shares of the common stock,

par value $0.0001 of the Company (the “CI Issued Shares”).

The value of the CI Issued Shares was, for purposes of the Agreement,

based on the closing trading price of the Company on October 1, 2021 (the date on which a third-party fairness opinion was issued), resulting

in an aggregate purchase price for Crowd Ignition of $5.3 million.

The shares were recorded at the nominal book value of the net assets

Ignition is a web-based crowdfunding software system.

Ronny Yakov, Chairman and CEO of the Company and John Herzog, a shareholder of

the Company, owned 100% of the equity of Crowd Ignition.

The software provides broker-dealer, merchant banks and law firms a platform

to market crowdfunding offerings, collect payments and issue securities.

The software has been developed in response to, and to comply

with, recent changes in investment regulations including Regulation D 506(b) and 506(v), Regulation A+ and Title III of the Jobs Act

(Regulation CF), including raising the crowdfunding limit from $1.07 million to $5.0 million.

Crowd Ignition is one of only about 50

companies registered with the SEC to provide the services permitted under Regulation CF.

of Operations

discussion and analysis of financial condition and results of operations (“MD&A”) includes a discussion of the consolidated

results from operations of The OLB Group, Inc.

and its subsidiaries for the three ended March 31, 2022 and 2021.

Months Ended March 31, 2022 Compared to the Three Months Ended March 31, 2021

For the three months ended March 31, 2022, we had total revenue of

$8,786,459 compared to $2,226,404 of revenue for the three months ended March 31, 2022, an increase of $6,560,055 or 294.6%.

$8,413,429 in transaction and processing fees, $17,168 in merchant equipment rental and sales, $91,522 in other revenue from monthly recurring

subscriptions and $264,340 of other revenue from the Cryptocurrency Mining segment during the three months ended March 31, 2022,

compared to $2,090,264 in transaction and processing fees, $18,507 in merchant equipment sales and $117,633 in other revenue during the

three months March 31, 2021.

The increase in revenue was a result of an increase in the amount of fees earned from merchant processing

transactions primarily due to the revenue attributed to the merchant portfolio acquired in the fourth quarter ended December 31, 2021

and to revenue from cryptocurrency mining, which we did not have in the prior period.

Processing and servicing costs increased by $4,710,863

Amortization and depreciation expense for the three months ended March

31, 2022 was $998,590 compared to $215,904 for the three months ended March 31, 2021, an increase of $782,686 or 362.5%.

We record amortization

expense on our merchant portfolio, trademarks and natural gas purchase rights.

Our amortization expense for the three months ended March

31, 2022, increased in the current year period due to the agreement with Cai Energy to purchase natural gas to operate the cryptocurrency

mining computers used in the Cryptocurrency Mining segment.

Depreciation expense for our cryptocurrency mining segment was $891,756 in

the current period due to the acquisition of Cryptocurrency Mining equipment.

and wage expense for the three months ended March 31, 2022 was $533,859 compared to $820,091 for the three months ended March 31, 2021

an decrease of $286,232 or 34.9%.

Professional fees for the three months ended March 31, 2022 were $324,407

compared to $226,944 for the three months ended March 31, 2021, an increase of $97,463 or 42.9%.

Professional fees consist mainly of audit

and legal fees.

The increase in the current period is mainly due to an increase in legal expense.

and administrative expenses (“G&A”) for the three months ended March 31, 2022 was $1,235,317 compared to $399,325 for

the three months ended March 31, 2021, an increase of $835,992 or 209.3%.

Some of our larger G&A expenses included travel of $108,000,

marketing and promotion of $125,000, contracted services of $259,000 and computer and internet expense of $145,000.

the three months ended March 31, 2022, we incurred $0 of interest expense, compared to $116,736 for the three months ended March 31,

2022, a decrease of $116,736.

The decrease in interest expense is due the conversion of all related party debt and the repayment of the

Term Loan in March 2021.

Our net loss for the three months ended March 31, 2022 was $1,455,596

compared to $1,099,857 for the three months ended March 31, 2021.

We had an increase in our net loss of $355,739 for the reasons discussed

Liquidity and Capital Resources

Trends and Uncertainties

The Company’s

future financial condition and results of operations may be adversely affected by the continued prolongation of the COVID-19 pandemic

and any need to institute additional business capacity restrictions or temporary closures.

The New York and Atlanta areas,

which include the location of the Company’s corporate headquarters and its operations business, have experienced and continue to

experience a significant impact of the COVID-19 pandemic in the U.S.

The Company continues to follow the recommendations of local health

authorities to minimize exposure risk for its employees and visitors.

However, the scale and scope and duration of the ongoing pandemic

remains unknown, and the ongoing business disruption and related financial impact cannot be reasonably estimated at this time as different

states have different regulations relating to business capacity.

While the Company has implemented specific business continuity plans

to reduce the potential impact of the ongoing COVID-19 pandemic during 2021 and believe that its business being principally operated using

digital platforms, in the long-term, will suffer minimal negative impact, there is no guarantee that the Company’s continuity plan

will be successful, that the Company’s merchants will meet the number of forecasted transactions due to a change in consumer activity

around point of sale purchasing resulting from the temporary closure of businesses.

In 2020 and the first nine

months of 2021, the Company continued to experience certain disruptions to its business and disruptions for the Company’s customers

and merchants, along with closures, that may materially affect the number of transactions processed by the Company.

Similarly, the COVID-19

pandemic could have a long-term impact on the Company’s customers and/or merchants during the remainder of 2021 which could reduce

their demand for Company products, if pre-pandemic levels of purchasing activity does not resume.

The extent to which the COVID-19 pandemic

or any other health epidemic may continue to impact the Company’s results for 2021 and beyond will depend on future developments,

which are highly uncertain and cannot be predicted, including the impact of vaccinations, the impact of the reopening of international

travel and new information which may emerge concerning the severity of the economic impact of the response to the COVID-19 pandemic on

the retail and service industries where the Company has many customers and merchants.

Accordingly, the COVID-19 pandemic could continue

to have a material adverse effect on the Company’s business, results of operations, financial condition and prospects during 2021

Although the reopening of businesses did result in an increase in transactions using the Company’s products to pre-pandemic

levels, there can be no assurance that the business will continue to see transaction volume at or above pre-pandemic levels.

any prolonged impact of the pandemic on the Company’s other businesses is likely to have an immaterial or no impact.

Changes in Cash Flows

For the nine months ended September 30, 2021, $1,602,406 of cash was

used by operating activities, which included our net loss, offset by $744,389 for amortization and depreciation expense, $232,965 for

stock-based compensation $34,859 of operating lease expense and net changes in operating assets and liabilities of $51,728.

For the nine months ended

September 30, 2021 and 2020, we used $6,068,300 and $125,000 for investment activities.

During the current year we purchased $93,300 of

office equipment and $5,910,000 of mining equipment for our DMINT subsidiary.

For the nine months ended September 30, 2021, we received net cash

of $5,009,270 in financing activities.

$7,654,845 was repaid on our loan to GACP.

We received a total of $7,160,940 from the exercise

of warrants issued in the Offering, $16 from the exercise of options and we netted $5,461,552 of cash from the sale of common stock and

Liquidity and Capital Resources

At September 30, 2021, the Company had cash of $1,163,055 and working

capital of $869,443.

For the three and nine months ended September 30, 2021, the Company’s net loss was $900,354 and $2.666,347,

respectively.

At September 30, 2021, the Company

had approximately $838,000 of outstanding liabilities.

On August 11, 2020, the Company

closed an offering of its securities (the “Offering”) for gross proceeds of $6.45 million.

The Company sold 700,000 units

consisting of (a) one share of our common stock;

(b) two Series A Warrants, and (c) one-half of one Series B warrant.

addition, the underwriter fully exercised its option to purchase 210,000 Series A warrants and 52,500 Series B warrants.

On March 2, 2021, the Company

utilizing a portion of funds received upon the exercise of outstanding warrants, paid approximately $7.7 million to the Agent under the

Credit Agreement (the “Prepayment”).

This Prepayment resulted in the discharge in full of all of the obligations under the

Credit Agreement.

In connection with the extinguishment of the obligations under the Credit Agreement, 40,000 warrants to purchase Common

Stock were cancelled.

On August 18, 2021, the

Company sold, in a registered direct offering, an aggregate of 1,418,605 shares of common stock and in a concurrent private placement,

warrants to purchase up to 1,418,605 shares of Common Stock, at an aggregate purchase price of $4.30 per Share and associated Warrant.

The Warrants will be exercisable six months from the date of issuance at an exercise price of $5.42 per share and will expire five and

one-half years following the initial date of issuance.

As a result of the transactions, the Company received gross proceeds of approximately

$6.1 million and net proceeds of $[ ] million

On November 2, 2021, the Company sold, in a private placement (the

“Private Placement”), (i) 1,969,091 shares (the “Shares”) of the Company’s common stock, par value $0.0001

per share (the “Common Stock”), (ii) pre-funded warrants (the “Prefunded Warrants”) exercisable for a total of

2,576,364 shares of Common Stock (the “Prefunded Warrant Shares”) with an exercise price of $0.0001 per Prefunded Warrant

Share, and (iii) warrants (the “Common Warrants”) exercisable for a total of 4,545,455 shares of Common Stock (the “Common

Warrant Shares” and together with the Prefunded Warrant Shares, the “Warrant Shares”) with an exercise price of $6.50

per Common Warrant Share.

The Private Placement closed on November 5, 2021.

The purchase price of each share of Common Stock and associated

Common Warrant was $5.50 and the purchase price of each Prefunded Warrant and associated Common Warrant was $5.4999.

Subject to certain

ownership limitations, the Common Warrants are immediately exercisable upon issuance and will expire on the five year anniversary of the

effective date of the initial registration statement filed under the Registration Rights Agreement (as defined below).

The Prefunded Warrants

are immediately exercisable upon issuance and may be exercised at any time until all of the Prefunded Warrants are exercised in full.

From the Private Placement, the Company received gross proceeds of approximately $25 million and net proceeds of $22.9 million.

In addition, the Company has

received a Paycheck Protection Program loan under the CARES Act for approximately $236,000 (the “PPP Loan”).

Protection Program provides that the use of PPP Loan proceeds was limited to certain qualifying expenses and may be partially

or wholly forgiven in accordance with the requirements set forth in the CARES Act.

The Company received notice on October 11, 2021 that

the PPP Loan had been entirely forgiven.

The Company has reviewed projected operating cash flows for 2021 and

an overall analysis of market trends to determine whether or not it has sufficient liquidity to continue as a going concern for a period

of at least twelve months from the date of this Quarterly Report.

As a result of the improved transaction volume trends the Company

experienced in the nine month period ended September 30, 2021, as well as the funds received from the capital raises discussed above,

including those received following the nine month period ended September 30, 2021, the Company believes it has sufficient liquidity in

order to sustain operations for at least of the following twelve months.

The Company has plans to grow

its cryptocurrency business by purchasing more mining computers and contracting with parties to establish a cryptocurrency lending, wallet

and exchange platform as a new product offering to merchants and other customers.

It also plans to increase its customer base through

acquisitions.

In addition, the Company plans to expand its payment processing business with the CBD merchant acquisitions and expand its

crowd funding platform with the acquisition of Crowd Ignition.

In order for the Company to execute all of its future plans to do business

in the cryptocurrency marketplace and to make acquisitions, it may be necessary to obtain additional capital.

This can be done by the

sale of equity or debt securities or obtaining a loan.

There can however be no assurances that the company will be able to raise additional

funds to expand its cryptocurrency business or any of the acquired businesses.

Critical Accounting Policies

Refer to our Form 10-K for

the year ended December 31, 2020, for a full discussion of our critical accounting policies.

QUANTITATIVE AND QUALITATIVE DISCLOSURES

ABOUT MARKET RISK

We are a smaller reporting

company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under

and Capital Resources

and Uncertainties

Company’s financial condition and results of operations for the next fiscal year 2022 may be adversely affected

by a further prolonging of the COVID-19 pandemic.

New York and Atlanta areas, including the location of the Company’s corporate headquarters and its operations business, continued

to experience impacts of the COVID-19 pandemic in the U.S.

The Company is currently following the recommendations of local health authorities

to minimize exposure risk for its employees and visitors.

However, the scale and duration of this pandemic remains unknown.

was another increase in cases requiring quarantines or closures of businesses, the duration of the business disruption and related financial

impact cannot be reasonably estimated at this time.

While the Company is currently implementing specific business continuity plans to

reduce the potential impact of COVID-19 during 2022 and believe that its business being principally operated using digital platforms,

in the long-term, will suffer minimal ongoing negative impact, there is no guarantee that the Company’s continuity plan will be

successful, that the Company’s merchants will meet the number of forecasted transactions due to a change in consumer activity around

point of sale purchasing resulting from the temporary closure of businesses in the future.

2021 and the first three months of 2022, as a result of the continued transmission of COVID-19 cases requiring quarantines and convalescence

of so many people, the Company experienced some disruptions to its business and disruptions for the Company’s customers and merchants

that had an impact on the number of transactions processed by the Company.

The extent to which COVID-19 or any other health epidemic

may impact the Company’s results for 2022 and beyond will depend on future developments and impacts of variants of the virus, which

are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the continuing economic

impact of the response to the COVID-19 pandemic.

Accordingly, COVID-19 could still have a material adverse effect on the Company’s

business, results of operations, financial condition and prospects during 2022 and beyond.

in Cash Flows

For the three months ended

March 31, 2022, $594,697 of cash was used by operating activities, which included our net loss, offset by $1,895,530 for amortization

and depreciation expense, $70,833 for stock-based compensation $32,430 of operating lease expense and net changes in operating assets

and liabilities of $1,137,894.

the three months ended March 31, 2022, we received net cash of $762,162 in financing activities from a loan payable.

and Capital Resources

At March 31, 2022, the Company had cash of $3,637,804 and working capital

of $2,796,893.

The Company has approximately $4.3 million of outstanding liabilities.

March 2, 2021, the Company utilizing a portion of funds received upon the exercise of outstanding warrants, paid approximately $7.7 million

to the pay off the entire outstanding amount of the Term Loan.

In connection with the extinguishment of the obligations under the Term

Loan, 40,000 warrants to purchase Common Stock were cancelled.

addition, the Company has received a Paycheck Protection Program loan under the CARES Act for approximately $236,000 (the “PPP

On October 11, 2021, the Company obtained forgiveness of all amounts due under the PPP Loan.

November 2, 2021, the Company entered into a series of securities purchase agreements with certain institutional accredited investors

pursuant to which the Company issued and sold, in a private placement (i) 1,969,091 shares (the “Shares”) of the Company’s

Common Stock (ii) pre-funded warrants exercisable for a total of 2,576,364 shares of Common Stock (the “Prefunded Warrant Shares”)

with an exercise price of $0.0001 per Prefunded Warrant Share, and (iii) warrants exercisable for a total of 4,545,455 shares of Common

Stock (the “Common Warrant Shares” and together with the Prefunded Warrant Shares, the “Warrant Shares”) with

an exercise price of $6.50 per Common Warrant Share.

The offering closed on November 5, 2021 and the Company received net proceeds of

approximately $22.9 million, after deducting placement agent fees and other offering expenses.

The Company intends to use the net

proceeds from the offering to invest in or acquire companies or technologies that are synergistic with or complimentary to its business,

to expand and market its current products and for working capital and general corporate purposes.

Company has reviewed its cash flow for 2022, projected operating cash flows for 2022 and 2023 and performed an overall analysis of market

trends to determine whether or not it has sufficient liquidity to continue as a going concern for a period of at least twelve months

from the date of this Quarterly Report.

As a result of (a) the improved transaction volume trends the Company experienced during

2021 and the first three months ended March 31, 2022, (b) the increase in the number of merchants after the acquisitions of several portfolios

during 2021, and (c) the funds received from the capital raises and PPP Loan, as discussed above, the Company believes it has sufficient

liquidity in order to sustain operations for at least the twelve months following the filing of this Quarterly Report.

Accounting Policies

to our Form 10-K for the year ended December 31, 2021, for a full discussion of our critical accounting policies.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide

the information under this Item.

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 2. Management’s Discussion and Analysis