What changed in this filing

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Item 1. Financial Statements

2024-11-14 compared with 2024-08-14 · 272 added, 216 removed, 885 unchanged (36% of the section changed)

1 unchanged sentence

INDEX TO FINANCIAL STATEMENTS

Consolidated Balance Sheets as of June 30, 2024 (unaudited) and December 31, 2023

Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and 2023 (unaudited)

Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2024 and 2023 (unaudited)

Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 (unaudited)

to the Condensed Consolidated Financial Statements (unaudited)

Condensed Consolidated Balance Sheets as of September 30, 2024 (unaudited) and December 31, 2023

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)

Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 (unaudited)

Notes to the Condensed Consolidated Financial Statements (unaudited)

The OLB Group, Inc.

1 unchanged sentence

Consolidated Balance Sheets

September 30,

Current Assets:

22 unchanged sentences

Notes payable, net of current portion

Convertible note payable –related party

Total Liabilities

2 unchanged sentences

Preferred stock, $ 0.01 par value, 1,000,000 shares authorized, no shares issued and outstanding

Series A Preferred stock, $ 0.01 par value, 10,000 shares authorized, 1,021 shares issued and outstanding at December 31, 2023 and 2022

Common stock, $ 0.0001 par value, 50,000,000 shares authorized, 1,810,200 and 1,534,408 shares issued, 1,797,583 and 1,521,791 shares outstanding at June 30, 2024 and December 31, 2023, respectively

Treasury stock, at cost, 12,617 shares at June 30, 2024 and December 31, 2023, respectively

Series A Preferred stock, $ 0.01 par value, 10,000 shares authorized, 1,021 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

Common stock, $ 0.0001 par value, 50,000,000 shares authorized, 1,821,725 and 1,547,025 shares issued, 1,809,108 and 1,521,791 shares outstanding at September 30, 2024 and December 31, 2023, respectively

Treasury stock, at cost, 12,617 shares at September 30, 2024 and December 31, 2023, respectively

Common stock receivable

Additional paid-in capital

3 unchanged sentences

Total stockholders’ equity of The OLB Group and Subsidiaries

Noncontrolling interest

Non-controlling interest

Total Stockholders’ Equity

1 unchanged sentence

The accompanying notes are an integral part

of these unaudited condensed consolidated financial statements.

of these unaudited consolidated financial statements.

The OLB Group, Inc.

2 unchanged sentences

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Transaction and processing fees

16 unchanged sentences

( 7,132,906 )

( 4,893,773 )

Other income (expense):

Realized gain (loss) on sale of cryptocurrency

Unrealized (loss) gain on investment

Realized gain and unrealized (loss) gain on investment

Interest expense

4 unchanged sentences

( 6,678,888 )

( 5,089,798 )

Income tax expense

2 unchanged sentences

( 6,678,888 )

( 5,089,798 )

Net income attributed to noncontrolling interest

3 unchanged sentences

( 6,678,888 )

( 5,008,411 )

Preferred dividends (related parties)

11 unchanged sentences

Consolidated Statements of Changes in Stockholders’

For the Three and Six Months Ended June 30,

For the Three and Nine Months Ended September

30, 2024 and 2023

1 unchanged sentence

Balance at December 31, 2023

Common stock issued for exercise of options

$ ( 109,988 )

$ ( 56,574,896 )

Common stock issued for exercise

Common stock sold for cash

Common stock issued to related parties for accrued liabilities

Preferred stock dividends-related party

Common stock issued to related parties

for accrued liabilities

Preferred stock dividends-related

Stock-based compensation

Adjustment for 10 for 1 reverse stock split

Adjustment for 10 for 1 reverse stock

( 2,371,596 )

( 2,400,618 )

Balance at March 31, 2024

Preferred stock dividends-related party

( 58,946,492 )

Preferred stock dividends-related

Stock-based compensation

Derecognition of noncontrolling interest

Derecognition of non controlling

( 2,648,012 )

Balance at June 30, 2024

Preferred Stock

( 61,623,526 )

Preferred stock dividends-related

Stock-based compensation

Common stock sold for cash

( 1,630,258 )

Balance at September 30, 2024

$ ( 109,988 )

$ ( 63,253,784 )

Balance at December 31, 2022

Common stock issued for director services

$ ( 109,988 )

$ ( 33,394,233 )

Common stock issued for director

Preferred stock dividends

Stock based compensation

( 2,615,405 )

Balance at March 31, 2023

( 36,009,638 )

Preferred stock dividends

Recognition of noncontrolling interest in acquisition

of non-controlling interest in acquisition

Balance at June 30, 2023

The accompanying notes are an integral part of these unaudited condensed

consolidated financial statements.

( 36,597,456 )

Preferred stock dividends

Stock based compensation

( 1,801,738 )

( 1,884,850 )

Balance at September 30, 2023

$ ( 109,988 )

$ ( 38,399,194 )

The accompanying notes are an integral part

of these unaudited condensed consolidated financial statements .

The OLB Group, Inc.

1 unchanged sentence

Consolidated Statements of Cash Flows

Six Months Ended

Nine Months Ended

September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

6 unchanged sentences

(Gain) loss on sale of bitcoin

Unrealized gain on investment

Realized gain on investment

Changes in assets and liabilities:

Accounts receivable

( 1,228,529 )

Prepaid expenses and other current assets

7 unchanged sentences

Proceeds from sale of investment

Acquisition of 19.99 % interest in Cuentas SDI, LLC

Acquisition of 19.99 % interest in Moola Cloud, LLC

Acquisition of property and equipment

( 1,229,630 )

Purchase of 80.01 % interest in Cuentas SDI, LLC

Net cash provided (used) by investing activities

Purchase of 80.01 % interest in Moola Cloud, LLC

Net cash provided by (used in) investing activities

( 2,079,630 )

5 unchanged sentences

Repayments on note payable

Net cash provided (used) by financing activities

Net cash provided by (used in) by financing activities

Net change in cash

4 unchanged sentences

Common stock issued for accrued liabilities

Common stock receivable

Preferred stock dividends

Cancellation of operating leases

The accompanying notes are an integral part

of these unaudited condensed consolidated financial statements.

The accompanying notes are an integral

part of these unaudited condensed consolidated financial statements.

The OLB Group, Inc.

and Subsidiaries

Notes to the Unaudited

Condensed Consolidated Financial Statements

June 30, 2024

Notes to the Unaudited Condensed Consolidated

Financial Statements

September 30, 2024

NOTE 1 – BACKGROUND

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subsidiary operates as a retail ISO and receives residual income as commission for merchants it places with third party processors.

Company’s eVance Capital, Inc.

subsidiary provides lending services to merchants processing with eVance, Inc.

Company’s eVance Capital, Inc subsidiary provides lending services to merchants processing with eVance, Inc.

CrowdPay.us, Inc.

18 unchanged sentences

Interest Purchase Agreement (the “Agreement”) with SDI Black 001, LLC (“Seller”) whereby it acquired 80.01 % of

the membership interests of Cuentas SDI, LLC, a Florida limited liability company (the “LLC”).

The LLC owns the platform of

Black011.com and the network serving over 31,000 convenience stores (“Bodegas”) in and around New York and New Jersey

(see Note 7).

the membership interests of Moola Cloud, LLC, a Florida limited liability company (formerly Cuentas SDI, LLC, the “LLC”).

The LLC owns the platform of Black011.com and the network serving over 31,000 convenience stores (“Bodegas”) in and around New

York and New Jersey (see Note 7).

On May 20, 2024, the Company entered into a Membership

Interest Purchase Agreement (the “Agreement”) dated as of May 20, 2024 with Cuentas, Inc.

(“Seller”) whereby it

acquired the remaining 19.99 % of the membership interests of SDI for a purchase price of $ 215,500 .

As a result, effective May 20, 2024

the Company owns 100 % of SDI.

Interest Purchase Agreement (the “Agreement”) dated as of May 20, 2024 with the minority member of the LLC whereby it acquired

the remaining 19.99 % of the membership interests of the LLC for a purchase price of $ 215,500 .

As a result, effective May 20, 2024, the

Company owns 100 % of the LLC.

On August 14, 2024, Cuentas LLC changed its name

to Moola Cloud, LLC.

The Company also provides ecommerce development

6 unchanged sentences

Estate Holdings, Inc., a wholly-owned subsidiary of DMINT.

The purpose of DMINT Real Estate Holdings, Inc.

is to buy and hold real estate

The purpose of DMINT Real Estate Holdings, Inc is to buy and hold real estate

related to DMINT.

6 unchanged sentences

all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position,

results of operations and cash flows of the Company as of and for the six month period ending June 30, 2024 and not necessarily indicative

of the results to be expected for the full year ending December 31, 2024.

These unaudited financial statements should be read in conjunction

with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December

results of operations and cash flows of the Company as of and for the nine month period ending September 30, 2024 and not necessarily

indicative of the results to be expected for the full year ending December 31, 2024.

These unaudited financial statements should be read

in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the

year ended December 31, 2023.

Use of Estimates

9 unchanged sentences

The accompanying unaudited consolidated financial

statements include the accounts of the Company and its wholly-owned subsidiaries, eVance Inc., eVance Capital Inc., Securus365, Inc.,

CrowdPay.us, Inc., OmniSoft, Inc., OLBit, Inc., DMINT, Inc., DMINT Real Estate Holdings and Cuentas SDI, LLC.

statements include the accounts of the Company and its wholly-owned subsidiaries, eVance Inc, eVance Capital Inc, Securus365, Inc., CrowdPay.us,

Inc., OmniSoft, Inc., OLBit, Inc., DMINT, Inc., DMINT Real Estate Holdings and Moola Cloud, LLC.

All significant intercompany transactions and

2 unchanged sentences

Certain reclassifications have been made to the

prior year financial information to conform to the presentation used in the financial statements for the period ended June 30, 2024.

prior year financial information to conform to the presentation used in the financial statements for the period ended September 30, 2024.

Fair Value of Financial Instruments

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At times, such deposits may be in excess of the Federal Deposit Insurance Corporation insurable amount (“FDIC”).

As of June 30, 2024 and December 31, 2023, the Company had no cash in excess of the FDIC’s $ 250,000 coverage limit.

As of September 30, 2024 and December 31, 2023, the Company had no cash in excess of the FDIC’s $ 250,000 coverage limit.

Operating Segments

5 unchanged sentences

The Company has two operating segments as of

June 30, 2024 and December 31, 2023.

September 30, 2024 and December 31, 2023.

(see Note 16).

16 unchanged sentences

of common stock during the period.

The weighted average number of common shares for the six months ended June 30, 2024 and 2023 does not

include warrants to acquire 856,313 shares of common stock because of their anti-dilutive effect.

The weighted average number of common

shares for six months ended June 30, 2024 and 2023, does not include 20,000 and 125,246 options, respectively, to purchase common stock

because of their anti-dilutive effect.

The weighted average number of common shares for the nine months ended September 30, 2024 and 2023

does not include warrants to acquire 856,313 shares of common stock because of their anti-dilutive effect.

The weighted average number

of common shares for six months ended September 30, 2024 and 2023, does not include 20,000 and 125,246 options, respectively, to purchase

common stock because of their anti-dilutive effect.

Investments in Equity Securities

11 unchanged sentences

in our impairment policy.

There was no impairment to the bitcoin value for periods ending June 30 2024 and 2023.

June 30, 2024 and December 31, 2023, the carrying value of the Company’s bitcoin was $ 592 and $ 312,103 , respectively.

30, 2024, the Company had 0.001 bitcoin on hand which had a fair value of $ 626 based on the price of bitcoin of approximately $ 62,678 .

For the three months ended June 30, 2024 and 2023, we recorded a realized gain (loss) on our bitcoin transactions of $0 and $ 48,683 , respectively.

For the six months ended June 30, 2024 and 2023, we recorded a realized gain (loss) on our bitcoin transactions of $ 225,229 and $( 279,242 ),

respectively.

For the three months ended June 30, 2024 and

September 30, 2024 and December 31, 2023, the carrying value of the Company’s bitcoin was $ 9,459 and $ 312,103 , respectively.

of September 30, 2024, the Company had 0.17 bitcoin on hand which had a fair value of $ 10,766 based on the price of bitcoin of approximately

For the three months ended September 30, 2024 and

2023, we recorded a realized gain (loss) on our bitcoin transactions of $0 and $0 , respectively.

For the nine months ended September

30, 2024 and 2023, we recorded a realized gain (loss) on our bitcoin transactions of $ 225,229 and $( 279,242 ), respectively.

Property and Equipment

17 unchanged sentences

property and equipment are as follows:

Item Useful Life

Computer equipment 3 years

Software 10 years

Office furniture 5 Years

Buildings and improvements 30 years

Computer equipment

2.5 - 3 years

Office furniture

Buildings and improvements

Intangible Assets

27 unchanged sentences

is determined to be less than the carrying amount of the asset or asset group, impairment in the amount of the difference is recorded.

The Company recorded no impairment expense for the three and six months

ended June 30, 2024 and 2023.

The Company recorded no impairment expense for the three and nine months

ended September 30, 2024 and 2023.

The Company accounts for business combinations

13 unchanged sentences

and goodwill and determined there was no impairment at December 31, 2023.

A summary of goodwill as of June 30, 2024, is

A summary of goodwill as of September 30, 2024,

is as follows:

Acquisition of assets from Excel Corporation and its subsidiaries on April 9, 2018

Acquisition of 80.01 % interest of Cuentas SDI, LLC on June 15, 2023 (see Note 7)

Goodwill balance as of June 30, 2024

Acquisition of 80.01 % interest of Moola Cloud, LLC on June 15, 2023 (see Note 7)

Goodwill balance as of September 30, 2024

Accounts Receivable

4 unchanged sentences

Based on collection experience and periodic reviews of outstanding receivables, we have recorded an allowance for doubtful accounts

of $ 207,850 and $ 207,850 as of June 30, 2024 and December 31, 2023, respectively.

of $ 207,850 and $ 207,850 as of September 30, 2024 and December 31, 2023, respectively.

Reserve for Chargeback Losses

9 unchanged sentences

and estimates the potential loss for chargebacks based primarily on historical experience and records a loss reserve accordingly.

the six months ended June 30, 2024 and 2023 chargebacks have reduced recorded revenue amounts and no reserve for loss has been recorded

as of June 30, 2024 and December 31, 2023.

the nine months ended September 30, 2024 and 2023 chargebacks have reduced recorded revenue amounts and no reserve for loss has been recorded

as of September 30, 2024 and December 31, 2023.

Revenue Recognition

1 unchanged sentence

revenue disaggregated by revenue source:

Three Months Ended

Six Months Ended

Transaction and processing fees from wholesale contracts

Transaction and processing fees from retail contracts

Other transaction and processing fees, revenue from monthly recurring subscriptions, and merchant equipment rental and sales

Cryptocurrency mining revenues

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

Transaction and processing fees

Merchant equipment rental and sales

Revenue, net - cryptocurrency mining

Other revenue from monthly recurring subscriptions

Digital product revenue

Total revenue from contracts with customers

Total revenue

The Company recognizes revenue under ASC 606,

39 unchanged sentences

for merchant underwriting, has no chargeback liability and has no or limited contractual relationship with the merchant.

The Company has

concluded it is the agent.

As such, the Company records the net amount it receives from the processor, after interchange and other interchange

and other processing fees, as revenue.

Company records the net amount it receives from the processor, after interchange and other interchange and other processing fees, as revenue.

Merchant equipment rental and sales

1 unchanged sentence

and rental of merchant equipment.

The Company has concluded it is the principal in these transactions.

The Company satisfies its performance

obligation upon delivery of equipment to merchants and recognizes revenue at a point in time.

The Company allows for customer returns

which are accounted for as variable consideration.

The Company estimates these amounts based on historical experience and reduces revenue

The Company invoices customers upon delivery of the equipment to merchants, and payments from such customers are due upon

The Company offers hardware installment sales to customers with terms ranging from three to forty-eight months.

allocates a portion of the consideration received from these arrangements to a financing component when it determines that a significant

financing component exists.

The financing component is subsequently recognized as financing revenue separate from hardware revenue, within

subscription and services-based revenue, over the terms of the arrangement with the customer.

Pursuant to practical expedients afforded

under ASC 606, the Company does not recognize a financing component for hardware installment sales that have a term of one year or less.

The Company satisfies its performance obligation upon delivery of equipment to merchants and recognizes

revenue at a point in time.

The Company allows for customer returns which are accounted for as variable consideration.

The Company estimates

these amounts based on historical experience and reduces revenue recognized.

The Company invoices customers upon delivery of the equipment

to merchants, and payments from such customers are due upon invoicing.

The Company offers hardware installment sales to customers with

terms ranging from three to forty-eight months.

The Company allocates a portion of the consideration received from these arrangements

to a financing component when it determines that a significant financing component exists.

The financing component is subsequently recognized

as financing revenue separate from hardware revenue, within subscription and services-based revenue, over the terms of the arrangement

with the customer.

Pursuant to practical expedients afforded under ASC 606, the Company does not recognize a financing component for hardware

installment sales that have a term of one year or less.

Monthly recurring subscriptions

46 unchanged sentences

recorded as a customer deposit and revenue is recognized over the relevant performance period as customers utilize the prepaid telecom

As of June 30, 2024, customer deposits were $0 .

As of September 30, 2024, customer deposits were $0 .

The Company determines whether an arrangement

61 unchanged sentences

NOTE 3 – LIQUIDITY AND CAPITAL RESOURCES

The Company’s unaudited consolidated financial

statements have been prepared in accordance with US GAAP, which assumes that the Company’s management will evaluate whether it will

be able to meet its obligations and continue its operations in the normal course of business.

At June 30, 2024, the Company had cash of

approximately $ 53,000 , accounts receivable of approximately $ 118,000 , and other prepaids and receivables of approximately $ 418,000 .

June 30, 2024 the Company has a cash overdraft, accounts payable and accrued expenses of approximately $ 4,714,000 .

There is also a note

payable of approximately $ 277,000 , a related party payable of approximately $ 847,000 and preferred dividend due of approximately $ 481,000 .

To date, the Company has generated cash flows from operations, issuances of equity and indebtedness and during the period ended June

Company’s unaudited consolidated financial statements have been prepared in accordance with US GAAP, which assumes that the Company’s

management will evaluate whether it will be able to meet its obligations and continue its operations in the normal course of business.

At September 30, 2024, the Company had cash of approximately $ 41,000 , accounts receivable of approximately $ 87,000 , and other prepaids

and receivables of approximately $ 515,000 .

At September 30, 2024

the Company has a cash overdraft, accounts payable and accrued expenses of approximately $ 5,230,000 .

There is also a note payable of

approximately $ 253,000 , a related party payable of approximately $ 1,204,000 and preferred dividend due of approximately $ 512,000 .

the Company has generated cash flows from operations, issuances of equity and indebtedness and during the period ended September 30,

2024 reported net cash used by operating activities of approximately $ 1,589,000 .

29 unchanged sentences

Management believes that its current available

resources, along with potential funds to be received from the ATM Offering, will be sufficient to fund the Company’s planned expenditures

over the next 12 months.

However, management recognizes that it may be required to obtain additional resources to successfully execute

its business plans.

No assurances can be given that management will be successful in raising additional capital, if needed, or on acceptable

These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts

and classification of liabilities that might be necessary should the Company determine it shall be unable to continue as a going concern.

resources, along with potential funds to be received from the ATM Offering and the loan agreement with Yakov Holdings, LLC (note 14),

will be sufficient to fund the Company’s planned expenditures over the next 12 months.

However, management recognizes that it may

be required to obtain additional resources to successfully execute its business plans.

No assurances can be given that management will

be successful in raising additional capital, if needed, or on acceptable terms.

These financial statements do not include any adjustments

relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary

should the Company determine, it shall be unable to continue as a going concern.

NOTE 4 – INTANGIBLE ASSETS

Intangible assets consist of the following:

September 30,

Merchant portfolios

13 unchanged sentences

Total intangible assets, net

Amortization expense for the six months ended

June 30, 2024 and 2023 was $ 308,808 and $ 1,799,662 , respectively.

Amortization expense for the three months ended

June 30, 2024 and 2023 was $ 117,847 and $ 899,831 , respectively.

Amortization expense for the three and nine months

ended September 30, 2024, was $ 112,499 and $ 421,307 , respectively.

Amortization expense for the three and nine months

ended September 30, 2023, was $ 899,834 and $ 2,699,496 , respectively.

The Company’s merchant portfolio and tradename

4 unchanged sentences

The weighted average remaining useful life of

amortizing intangible assets was 4.62 years at June 30, 2024.

amortizing intangible assets was 4.37 years at September 30, 2024.

NOTE 5 – PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

September 30,

Office equipment

6 unchanged sentences

Property and Equipment, net

Depreciation expense for the three and six months

ended June 30, 2024 was $ 843,671 and $ 1,593,191 , respectively.

Depreciation expense for the three and six months

ended June 30, 2023 was $ 799,716 and $ 1,599,433 , respectively.

expense for the three and nine months ended September 30, 2024, was $ 656,017 and

$ 2,249,208 , respectively.

Depreciation expense for the three and nine months ended September 30, 2023, was $ 910,743 and $ 2,510,176 , respectively.

NOTE 6 – INVESTMENT IN EQUITY SECURITIES

1 unchanged sentence

Capital Token Opportunity Fund LP (the “Fund”) for which it paid an aggregate of $ 250,000 in August 2021.

The investment was

locked up for two years and a redemption can be made after the expiration of the lock up period with 90 days written notice.

may, at the discretion of the General Partner, compulsorily redeem all interests if the Net Asset Value of the Fund falls below $ 1,000,000 .

During the six months ended June 30, 2024 and 2023, the Company recognized an unrealized gain (loss) of $ 274,731 and ($ 6,490 ), respectively.

During the six months ended June 30, 2024, the Company redeemed the Fund and received proceeds of $ 548,393 .

As of June 30, 2024 and December

31, 2023, the investment in equity securities was $0 and $ 273,662 , respectively.

During the nine

months ended September 30, 2024 and 2023, the Company recognized a realized gain (loss) of $ 274,731 and an unrealized (loss) of ($ 31,437 ),

respectively.

During the nine months ended September 30, 2024, the Company redeemed the Fund and received proceeds of $ 548,393 .

September 30, 2024 and December 31, 2023, the investment in equity securities was $0 and $ 273,662 , respectively.

NOTE 7 – BUSINESS COMBINATIONS

1 unchanged sentence

Interest Purchase Agreement (the “Agreement”) with SDI Black 001, LLC (“Seller”) whereby it acquired 80.01 % of

the membership interests of Cuentas SDI, LLC, a Florida limited liability company (the “LLC”) for a purchase price of $ 850,000 .

the membership interests of Moola Cloud, LLC, a Florida limited liability company (the “LLC”) for a purchase price of $ 850,000 .

The Company accounted for the transaction as a

3 unchanged sentences

fair values of the underlying identifiable assets acquired, liabilities assumed, and non-controlling interest was allocated to goodwill.

The provisional estimated fair value of the noncontrolling interest was based on the price the Company paid for their 80.01 % of their

The provisional estimated fair value of the non-controlling interest was based on the price the Company paid for their 80.01 % of their

controlling interest.

2 unchanged sentences

The allocation of the purchase price and the estimated

fair market values of the assets acquired, liabilities assumed, and noncontrolling interest are shown below:

fair market values of the assets acquired, liabilities assumed, and non-controlling interest are shown below:

Consideration

Consideration issued

Identified assets, liabilities, and noncontrolling interest

Identified assets, liabilities, and non-controlling interest

Property and equipment, net

3 unchanged sentences

Accrued expenses

Noncontrolling interest

Total identified assets, liabilities, and noncontrolling interest

Non-controlling interest

Total identified assets, liabilities, and non-controlling interest

Excess purchase price allocated to goodwill

On May 20, 2024, the Company entered into a Membership

Interest Purchase Agreement (the “Agreement”) dated as of May 20, 2024 with Cuentas, Inc.

(“Seller”) whereby it

acquired the remaining 19.99 % of the membership interests of SDI for a purchase price of $ 215,500 .

As a result, effective May 20, 2024

the Company owns 100 % of SDI.

The acquisition of the 19.99 % interest is accounted for as a capital transaction in the statement of changes

in stockholders’ equity.

Interest Purchase Agreement (the “Agreement”) dated as of May 20, 2024 with the minority member of the LLC whereby it acquired

the remaining 19.99 % of the membership interests of the LLC for a purchase price of $ 215,500 .

As a result, effective May 20, 2024, the

Company owns 100 % of SDI.

NOTE 8 – NOTE PAYABLE

November 29, 2021, the Company entered into a Master Equipment Finance Agreement (the “MFA”) with VFS LLC

(“VFS”) which would allow the Company to finance the purchase of certain equipment.

The collateral and interest rate are

determined at the time the Company borrows the funds.

During the year ended December 31, 2022, the Company received, as an initial

draw on the MFA, $ 875,000 from VFS (the “Equipment Loan”).

The Equipment Loan is secured by bitcoin mining computers

being utilized by DMINT.

The Equipment Loan requires monthly payments of $ 24,838 until the loan is repaid in full or it matures on

March 1, 2025.

During the six months ended June 30, 2024, the Company made repayments of $ 173,864 .

As of June 30, 2024, the note

payable balance was $ 277,452 .

On November 29, 2021, the Company entered into

a Master Equipment Finance Agreement (the “MFA”) with VFS LLC (“VFS”) which would allow the Company to finance

the purchase of certain equipment.

The collateral and interest rate are determined at the time the Company borrows the funds.

year ended December 31, 2022, the Company received, as an initial draw on the MFA, $ 875,000 from VFS (the “Equipment Loan”).

The Equipment Loan is secured by bitcoin mining computers being utilized by DMINT.

The Equipment Loan requires monthly payments of $ 24,838

until the loan is repaid in full or it matures on March 1, 2025.

During the nine months ended September 30, 2024, the Company made repayments

of $ 198,702 .

As of September 30, 2024, the note payable balance was $ 252,614 .

NOTE 9 – STOCK OPTIONS

21 unchanged sentences

Options outstanding December 31, 2023

Options outstanding June 30, 2024

Shares exercisable at June 30, 2024

During the six months ended June 30, 2024 and

2023 the Company recognized $ 338,750 and $ 132,787 , respectively, in stock-based compensation related to the above-mentioned options.

the three months ended June 30, 2024 and 2023 the Company recognized $ 33,875 and $ 0 , respectively, in stock-based compensation related

to the above-mentioned options.

As of June 30, 2024 there was $ 203,249 of unrecognized expense for the above-mentioned options is expected

to extend for 1.51 years and the weighted average contractual term of the options outstanding and of the option exercisable were 9.51

Options outstanding September 30, 2024

Shares exercisable at September 30, 2024

During the nine months ended September 30, 2024

and 2023 the Company recognized $ 372,624 and $ 161,605 , respectively, in stock-based compensation related to the above-mentioned options.

As of September 30, 2024 there was $ 169,375 of unrecognized expense for the above-mentioned options is expected to extend for 1.51 years

and the weighted average contractual term of the options outstanding and of the option exercisable were 9.26 years.

NOTE 10 – WARRANTS

7 unchanged sentences

Warrants Exercised —

Outstanding, June 30, 2024 856,313 $ 68.33 2.08

Outstanding, September 30, 2024 856,313 $ 68.33 2.08

NOTE 11 – OPERATING LEASES

23 unchanged sentences

operations were moved to the Selmer, Tennessee building owned by the Company.

Lease expense for the six months ended June 30,

Lease expense for the nine months ended September

30, 2024 and 2023, was $ 57,051 and $ 93,532 , respectively.

Lease expense for the three months ended June 30, 2024 and 2023, was $ 29,029

and $ 25,334 , respectively.

Lease expense for the three months ended September 30, 2024 and 2023,

was $ 5,950 and $ 25,790 , respectively.

The Company has multiple short term rental arrangements that are not captured under ASC 842.

Those payments

are expensed as incurred and included in the total lease expense for each year.

As of June 30, 2024, there are no leases remaining

with a term in excess of one year.

Those payments are expensed as incurred and included in the total lease expense for each year.

As of September 30, 2024, there are no leases

remaining with a term in excess of one year.

NOTE 12 – COMMON STOCK

13 unchanged sentences

to purchase a total of 381,069 pre-split shares of common stock ( 38,107 post-split) for $ 2,761 (see Note 9 and Note 14).

During the six months ended June 30, 2024, the

Company sold 1,408 shares of common stock for total proceeds of $ 9,775 .

the nine months ended September 30, 2024, the Company sold 12,933 shares of common stock from its ATM Offering, for total proceeds of

As of September 30, 2024, $ 1,565 has not yet been

received and is disclosed as common stock receivable.

The amount was received in October 2024.

On April 26, 2024, the Company filed with the

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value (the “Stated Value”) of $ 1,000 per share.

As of June 30, 2024 and 2023 there were 1,021 shares of Series A Preferred

Stock issued and outstanding.

As of September 30, 2024 and 2023 there were 1,021 shares of Series A

Preferred Stock issued and outstanding.

Holders of Series A Preferred Stock are entitled to the following rights and preferences.

39 unchanged sentences

to purchase a total of 1,187,919 pre-split shares of common stock ( 118,792 post-split) for $ 4,079 (see Note 9 and Note 12).

included 76,792 options (post-split) Mr.

exercise included 76,792 options (post-split) Mr.

Yakov purchased from Cai Energy Blockchain, Inc.

3 unchanged sentences

to purchase a total of 381,069 pre-split shares of common stock ( 38,107 post-split) for $ 2,761 (see Note 9 and Note 12).

During the six months ended June 30, 2024, Mr.

During the nine months ended September 30, 2024,

Yakov made payments on behalf of the Company in the amount of $ 1,191,282 .

As of June 30, 2024, the Company owes Mr.

As of September 30, 2024, the Company owes Mr.

Yakov $ 1,203,960 .

amount is non-interest bearing and due on demand.

The amount is non-interest bearing and due on demand.

Interest will begin to accrue in Q2 2025.

During the six months ended June 30, 2024 and

2023, the Company accrued $ 62,281 and $ 61,600 , respectively, for dividends on the Series A preferred stock held by Mr.

three months ended June 30, 2024 and 2023, the Company accrued $ 30,970 and $ 30,970 , respectively, for dividends on the Series A preferred

stock held by Mr.

As of June 30, 2024 and December 31, 2023, total accrued dividends on the Series A preferred stock due to Mr.

During the nine months ended September 30, 2024

and 2023, the Company accrued $ 93,592 and $ 92,911 , respectively, for dividends on the Series A preferred stock held by Mr.

the three months ended September 30, 2024 and 2023, the Company accrued $ 31,311 and $ 31,311 , respectively, for dividends on the Series

A preferred stock held by Mr.

As of September 30, 2024 and December 31, 2023, total accrued dividends on the Series A preferred

stock due to Mr.

Yakov is $ 512,198 and $ 418,606 , respectively.

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50 % upon the grant date, then 25 % upon each of the second and third anniversary of the date on which it is granted.

On August 12, 2024, the Company entered into an

agreement with Yakov Holdings LLC, an entity controlled by Mr.

Yakov (the “Yakov LLC”) whereby the Yakov LLC committed to

loan to the Company up to Five Million Dollars ($ 5,000,000 ) (the "Yakov LLC Loan").

The Yakov LLC Loan is revolving in nature,

allowing the Company to borrow, repay, and re-borrow amounts under the terms and conditions set forth herein, provided that the total

outstanding amount shall not exceed Five Million Dollars ($ 5,000,000 ).

The interest rate of the Yakov LLC Loan is twelve percent ( 12 %)

and it matures on August 12, 2025 .

In addition, the Yakov LLC Loan is secured by a first priority security interest for the benefit of

the Yakov LLC over all of the assets of the Company.

Refer to Note 9 for options to purchase shares

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NOTE 16 – SEGMENTS

The Company applies ASC 280, Segment Reporting ,

The Company uses ASC 280, Segment Reporting ,

in determining its reportable segments.

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The following table details revenue, operating

expenses, and assets for the Company’s reportable segments for the six months ended June 30, 2023.

expenses, and assets for the Company’s reportable segments for the nine months ended September 30, 2024.

Current Assets:

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Due to/from intercompany

( 22,097,221 )

Total Current Liabilities

( 14,770,363 )

Convertible note payable –related party

Total Liabilities

( 13,673,466 )

Stockholders’ Equity:

1 unchanged sentence

Treasury stock

Common stock receivable

Additional paid-in capital

Accumulated deficit

( 47,482,304 )

( 15,771,480 )

( 63,253,784 )

Total stockholders’ equity

( 15,771,480 )

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

For the Six Months Ended June 30, 2024

For the Nine Months Ended September 30, 2024

Transaction and processing fees

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Loss from operations

( 3,347,042 )

( 3,785,864 )

( 7,132,906 )

Other income (expense):

2 unchanged sentences

Interest expense

Total other income

Total other (expense) income

( 3,392,984 )

( 3,285,904 )

( 6,678,888 )

Preferred dividends (related parties)

Net Loss Applicable to Common Shareholders

$ ( 3,486,576 )

$ ( 3,285,904 )

$ ( 6,772,480 )

NOTE 17 – MERCHANT PORTFOLIO PURCHASE

6 unchanged sentences

Company management

has recognized a liability for the $ 2,000,000 contingent payment amount as of June 30, 2024 and December 31, 2023.

Legal proceedings regarding

this matter began in 2022 and have continued through 2024, see Note 15.

has recognized a liability for the $ 2,000,000 contingent payment amount as of September 30, 2024 and December 31, 2023.

Legal proceedings

regarding this matter began in 2022 and have continued through 2024, see Note 15.

NOTE 18 – SUBSEQUENT EVENTS

In accordance with ASC 855-10 management has performed

an evaluation of subsequent events through the date that the financial statements were issued and has determined that is has the following

material subsequent events to disclose in these financial statements.

On August 12, 2024, the Company entered into an

agreement with Yakov Holdings LLC, an entity controlled by Mr.

Yakov (the “Yakov LLC”) whereby the Yakov LLC committed to

loan to the Company up to Five Million Dollars ($ 5,000,000 ) (the "Yakov LLC Loan").

The Yakov LLC Loan is revolving in nature,

allowing the Company to borrow, repay, and re-borrow amounts under the terms and conditions set forth herein, provided that the total

outstanding amount shall not exceed Five Million Dollars ($ 5,000,000 ).

The interest rate of the Yakov LLC Loan is twelve percent ( 12 %)

and it matures on June 18, 2025.

In addition, the Yakov LLC Loan is secured by a first priority security interest for the benefit of

the Yakov LLC over all of the assets of the Company.

In accordance with SFAS 165 (ASC 855-10) management

has performed an evaluation of subsequent events through the date that the financial statements were issued and has determined that is

has the following material subsequent events to disclose in these financial statements.

Subsequent to September 30, 2024, the Company

sold 343,251 shares of common stock from its ATM Offering, for total proceeds of $ 755,558 .

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 1. Financial Statements