What changed in this filing

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Item 1. Financial Statements

2023-08-04 compared with 2023-05-09 · 419 added, 291 removed, 713 unchanged (50% of the section changed)

6 unchanged sentences

Cash and cash equivalents (Note 3)

Financial instruments owned, at fair value (including $ 45,214 and $ 25,283 invested in WisdomTree products at March 31, 2023 and December 31, 2022, respectively) (Note 5)

Accounts receivable (including $ 32,446 and $ 24,139 due from related parties at March 31, 2023 and December 31, 2022, respectively)

Financial instruments owned, at fair value (including $ 38,451 and $ 25,283 invested in WisdomTree products at June 30, 2023 and

December 31, 2022, respectively) (Note 5)

receivable (including $ 32,642 and $ 24,139 due from related parties at June 30, 2023 and December 31, 2022, respectively)

Prepaid expenses

13 unchanged sentences

Current liabilities:

Convertible notes—current (Note 10)

Fund management and administration payable

Deferred consideration—gold payments (Note 9)

Compensation and benefits payable

Income taxes payable

Operating lease liabilities (Note 12)

Convertible notes—current (Note 10)

Deferred consideration—gold payments (Note 9)

Income taxes payable

Accounts payable and other liabilities

8 unchanged sentences

14.750 shares authorized, issued and outstanding;

redemption value of $ 86,638 and $ 77,969 at March 31, 2023 and December 31, 2022, respectively) (Note 11)

redemption value of

$ 103,480 and $ 77,969 at June 30, 2023 and December 31, 2022, respectively) (Note 11)

Contingencies (Note 13)

2 unchanged sentences

2,000 shares authorized

Preferred stock—Series C Non-Voting

Convertible, par value $ 0.01 ;

13.087 shares authorized, issued and outstanding

Common stock, par value $ 0.01 ;

1 unchanged sentence

issued and outstanding:

149,291 and 146,517 at March 31, 2023 and December 31, 2022, respectively

150,343 and 146,517 at June 30, 2023 and December 31,

2022, respectively

Additional paid-in

9 unchanged sentences

Three Months Ended

Six Months Ended

Operating Revenues:

15 unchanged sentences

Interest expense

Gain/(loss) on revaluation of deferred consideration—gold payments (Note 9)

Gain/(loss) on revaluation/termination of deferred consideration—gold payments (Note 9)

Interest income

1 unchanged sentence

Loss on extinguishment of convertible notes (Note 10)

Other losses, net

Other gains and losses, net

Income/(loss) before income taxes

12 unchanged sentences

Three Months Ended

Six Months Ended

Net income/(loss)

8 unchanged sentences

(In Thousands)

For the Three Months Ended March 31, 2023

For the Three Months Ended June 30, 2023

Preferred Stock

Comprehensive

Balance—April 1, 2023

Shares issued in connection with termination of the deferred consideration—gold payments obligation, net of issuance costs (Note 9)

Restricted stock issued and vesting of restricted stock units, net

Shares issued in connection with convertible notes that matured on June 15, 2023 (Note 10)

Shares repurchased

Stock-based compensation

Other comprehensive income

Balance—June 30, 2023

For the Three Months Ended June 30, 2022

Preferred Stock

Comprehensive

Income/(Loss)

Balance—April 1, 2022

Restricted stock issued and vesting of restricted stock units, net

Stock-based compensation

Other comprehensive loss

Balance—June 30, 2022

The accompanying notes are an integral part of these consolidated financial statements

WisdomTree, Inc.

and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity (Continued)

(In Thousands)

For the Six Months Ended June 30, 2023

Series C Preferred

Comprehensive

Balance—January 1, 2023

Shares issued in connection with termination of the deferred consideration—gold payments obligation, net of issuance costs (Note 9)

Restricted stock issued and vesting of restricted stock units, net

Shares issued in connection with convertible notes that matured on June 15, 2023 (Note 10)

Shares repurchased

1 unchanged sentence

Other comprehensive income

Balance—March 31, 2023

For the Three Months Ended March 31, 2022

Balance—June 30, 2023

For the Six Months Ended June 30, 2022

Series C Preferred

Comprehensive

Income/(Loss)

Balance—January 1, 2022

3 unchanged sentences

Other comprehensive loss

Balance—March 31, 2022

Balance—June 30, 2022

The accompanying notes are an integral part of these consolidated financial statements

3 unchanged sentences

(In Thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

Net income/(loss)

Adjustments to reconcile net income/(loss) to net cash used in operating activities:

(Gain)/loss on revaluation of deferred consideration—gold payments

Adjustments to reconcile net income/(loss) to net cash provided by operating activities:

(Gain)/loss on revaluation/termination of deferred consideration—gold payments

Advisory and license fees paid in gold, other precious metals and cryptocurrency

Loss on extinguishment of convertible notes

Deferred income taxes

Stock-based compensation

Contractual gold payments

Losses on investments

(Gains)/losses on financial instruments owned, at fair value

Deferred income taxes

Amortization of issuance costs—convertible notes

(Gains)/losses on financial instruments owned, at fair value

Losses on investments

Amortization of right of use asset

10 unchanged sentences

Accounts payable and other liabilities

Net cash used in operating activities

Net cash provided by operating activities

Cash flows from investing activities:

1 unchanged sentence

Purchase of investments

Acquisition of Securrency Transfers, Inc.

(net of cash acquired)

Purchase of fixed assets

Proceeds from the sale of financial instruments owned, at fair value

Receipt of contingent consideration – Sale of Canadian ETF business

Proceeds from held-to-maturity

securities maturing or called prior to maturity

Net cash used in investing activities

Net cash provided by/(used in) investing activities

Cash flows from financing activities:

Repurchase of convertible notes (See Note 10)

Repurchase and maturity of convertible notes (Note 10)

Termination of deferred consideration—gold payments

Dividends paid

Issuance costs—Convertible notes

Shares repurchased

Convertible notes issuance costs

Issuance costs—Series C Preferred Stock

Proceeds from the issuance of convertible notes (Note 10)

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Cash paid for interest

WisdomTree, Inc.

and Subsidiaries

Consolidated Statements of Cash Flows (Continued)

(In Thousands)

INVESTING AND FINANCING ACTIVITIES

On May 10, 2023, the Company issued

13.087 shares of Series C Non-Voting Convertible Preferred Stock (valued at $

86,898 ) in connection with the termination of its deferred consideration—gold payments obligation.

See Notes 9 and 11 for additional information.

15, 2023, the Company issued 1,037 shares of common stock (as the conversion option was in the money) in connection with the maturity of $ 60,000 aggregate principal amount of 4.25 % Convertible Senior Notes.

The accompanying notes are an integral part of these consolidated financial statements

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WisdomTree, Inc., through its global subsidiaries (collectively, “WisdomTree” or the “Company”), is a global financial innovator, offering a well-diversified suite of exchange-traded products (“ETPs”), models and solutions.

Building on its heritage of innovation, the Company is also developing next-generation digital products and structures, including digital or blockchain-enabled mutual funds (“Digital Funds”) and tokenized assets, as well as its blockchain-native digital wallet, WisdomTree Prime ™

Building on its heritage of innovation, the Company is also developing and has recently launched next-generation digital products and structures, including digital or blockchain-enabled mutual funds (“Digital Funds”) and tokenized assets, as well as its blockchain-native digital wallet, WisdomTree Prime ™

The Company has the following wholly-owned operating subsidiaries:

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The WisdomTree Digital Funds are issued in the U.S.

WTDT is a Delaware statutory trust registered with the SEC as an open-end management investment company.

Each Digital Fund will use blockchain technology to maintain a secondary record of its shares on one or more blockchains (e.g., Stellar or Ethereum), but will not directly or indirectly invest in any assets that rely on blockchain technology, such as cryptocurrencies.

WTDT is a non-consolidated

Delaware statutory trust registered with the SEC as an open-end

management investment company.

Each Digital Fund uses blockchain technology to maintain a secondary record of its shares on one or more blockchains (e.g., Stellar or Ethereum), but does not directly or indirectly invest in any assets that rely on blockchain technology, such as cryptocurrencies.

WisdomTree Digital Movement, Inc

is a New York based company operating as a money services business registered with the Financial Crimes Enforcement Network (“FinCEN”) and seeking state money transmitter licenses to operate a platform for the purchase, sale and exchange of digital assets, while also providing digital wallet services through WisdomTree Prime ™

is a New York based company operating as a money services business registered with the Financial Crimes Enforcement Network and seeking state money transmitter licenses to operate a platform for the purchase, sale and exchange of digital assets, while also providing digital wallet services through WisdomTree Prime ™

to facilitate such activity.

1 unchanged sentence

is a New York based limited purpose broker-dealer (i.e., mutual fund retailer), facilitating transactions in WisdomTree Digital Funds.

WisdomTree Transfers, Inc.

is a New York based transfer agent registered with the SEC, providing transfer agency services for the Digital Funds.

The transfer agent maintains the official record of share ownership in book entry form and reconciles the official record with the secondary record of ownership of shares on one or more blockchains.

Significant Accounting Policies

29 unchanged sentences

Contractual gold payments are measured and paid monthly based upon the average daily spot price of gold (Note 9).

The Company’s obligation to continue making these payments terminated on May 10, 2023.

Marketing and Advertising

5 unchanged sentences

Stock-Based Awards

Accounting for stock-based compensation requires the measurement and recognition of compensation expense for all equity awards based on estimated fair values.

for stock-based compensation requires the measurement and recognition of compensation expense for all equity awards based on estimated fair values.

Stock-based compensation is measured based on the grant-date fair value of the award and is amortized over the relevant service period.

1 unchanged sentence

Third-Party Distribution Fees

The Company pays a percentage of its advisory fee revenues based on incremental growth in assets under management (“AUM”), subject to caps or minimums, to marketing agents to sell WisdomTree ETFs and for including WisdomTree ETFs on third-party customer platforms and recognizes these expenses as incurred.

Company pays a percentage of its advisory fee revenues based on incremental growth in assets under management (“AUM”), subject to caps or minimums, to marketing agents to sell WisdomTree ETFs and for including WisdomTree ETFs on third-party customer platforms and recognizes these expenses as incurred.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be classified as cash equivalents.

Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be classified as cash equivalents.

The Company maintains deposits with financial institutions in an amount that is in excess of federally insured limits.

Accounts Receivable

Accounts receivable are customer and other obligations due under normal trade terms.

receivable are customer and other obligations due under normal trade terms.

The Company measures credit losses, if any, by applying historical loss rates, adjusted for current conditions and reasonable and supportable forecasts to amounts outstanding using the aging method.

Impairment of Long-Lived Assets

The Company performs a review for the impairment of long-lived assets when events or changes in circumstances indicate that the estimated undiscounted future cash flows expected to be generated by the assets are less than their carrying amounts or when other events occur which may indicate that the carrying amount of an asset may not be recoverable.

Company performs a review for the impairment of long-lived assets when events or changes in circumstances indicate that the estimated undiscounted future cash flows expected to be generated by the assets are less than their carrying amounts or when other events occur which may indicate that the carrying amount of an asset may not be recoverable.

Financial Instruments Owned and Financial Instruments Sold, but Not yet Purchased (at Fair Value)

Financial instruments owned and financial instruments sold, but not yet purchased are financial instruments classified as either trading or available-for-sale

instruments owned and financial instruments sold, but not yet purchased are financial instruments classified as either trading or available-for-sale

These financial instruments are recorded on their trade date and are measured at fair value.

8 unchanged sentences

Securities Held-to-Maturity

The Company accounts for certain of its securities as held-to-maturity

Company accounts for certain of its securities as held-to-maturity

on a trade date basis, which are recorded at amortized cost.

8 unchanged sentences

status is recognized on a cash basis as interest income if and when received.

The Company reviews its portfolio of held-to-maturity

Company reviews its portfolio of held-to-maturity

securities for impairment on a quarterly basis, recognizing an allowance, if any, by applying an estimated loss rate after consideration for the nature of collateral securing the financial asset as well as potential future changes in collateral values and historical loss information for financial assets secured with similar collateral.

Investments in pass-through government-sponsored enterprises (“GSEs”) are determined to have an estimated loss rate of zero due to an implicit U.S.

in pass-through government-sponsored enterprises (“GSEs”) are determined to have an estimated loss rate of zero due to an implicit U.S.

government guarantee.

The Company accounts for equity investments that do not have a readily determinable fair value under the measurement alternative prescribed in Accounting Standards Codification (“ASC”) Topic 321, Investments – Equity Securities

Company accounts for equity investments that do not have a readily determinable fair value under the measurement alternative prescribed in Accounting Standards Codification (“ASC”) Topic 321, Investments – Equity Securities

(“ASC 321”), to the extent such investments are not subject to consolidation or the equity method.

2 unchanged sentences

Otherwise, such distributions are considered returns of investment and are recorded as a reduction of the cost of the investment.

Investments in debt instruments are accounted for at fair value, with changes in fair value reported in other income/(expenses).

Goodwill is the excess of the purchase price over the fair values of the identifiable net assets at the acquisition date.

in debt instruments are accounted for at fair value, with changes in fair value reported in other income/(expenses).

is the excess of the purchase price over the fair values of the identifiable net assets at the acquisition date.

The Company tests goodwill for impairment at least annually and at the time of a triggering event requiring re-evaluation,

3 unchanged sentences

A reporting unit is an operating segment or a component of an operating segment provided that the component constitutes a business for which discrete financial information is available and management regularly reviews the operating results of that component.

Goodwill is allocated to the Company’s U.S.

is allocated to the Company’s U.S.

business and European business components.

For impairment testing purposes, these components are aggregated as a single reporting unit as they fall under the same operating segment and have similar economic characteristics.

Goodwill is assessed for impairment annually on November 30 th

is assessed for impairment annually on November 30 th

When performing its goodwill impairment test, the Company considers a qualitative assessment, when appropriate, and a quantitative assessment using the market approach and its market capitalization when determining the fair value of the reporting unit.

Intangible Assets

Indefinite-lived intangible assets are tested for impairment at least annually and are also reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

e-lived intangible assets are tested for impairment at least annually and are also reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Indefinite-lived intangible assets are impaired if their estimated fair values are less than their carrying values.

Finite-lived intangible assets, if any, are amortized over their estimated useful life, which is the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Company.

e-lived intangible assets, if any, are amortized over their estimated useful life, which is the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Company.

These intangible assets are tested for impairment at the time of a triggering event, if one were to occur.

Finite-lived intangible assets may be impaired when the estimated undiscounted future cash flows generated from the assets are less than their carrying amounts.

The Company may rely on a qualitative assessment when performing its intangible asset impairment test.

Company may rely on a qualitative assessment when performing its intangible asset impairment test.

Otherwise, the impairment evaluation is performed at the lowest level of reasonably identifiable cash flows independent of other assets.

The annual impairment testing date for all of the Company’s intangible assets is November 30 th

The annual impairment testing date for all of the Company’s intangible assets is November 30

Software Development Costs

Software development costs incurred after the preliminary project stage is complete are capitalized if it is probable that the project will be completed and the software will be used as intended.

development costs incurred after the preliminary project stage is complete are capitalized if it is probable that the project will be completed and the software will be used as intended.

Capitalized costs consist of employee compensation costs and fees paid to third parties who are directly involved in the application development efforts and are included in intangible assets, net in the Consolidated Balance Sheets.

1 unchanged sentence

Once the application development stage is complete, additional costs are expensed as incurred.

The Company accounts for its lease obligations in accordance with ASC Topic 842, Leases

Company accounts for its lease obligations in accordance with ASC Topic 842, Leases

(“ASC 842”), which requires the recognition of both (i) a lease liability equal to the present value of the remaining lease payments and (ii) an offsetting right-of-use

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Instead, lease payments associated with short-term leases are recognized as an expense on a straight-line basis over the lease term.

ASC 842 also provides a practical expedient which allows for consideration in a contract to be accounted for as a single lease component rather than allocated between lease and non-lease

842 also provides a practical expedient which allows for consideration in a contract to be accounted for as a single lease component rather than allocated between lease and non-lease

The Company has elected to apply this practical expedient to all lease contracts, where applicable.

Deferred Consideration—Gold Payments

Deferred consideration represents the present value of an obligation to pay gold to a third party into perpetuity and is measured using forward-looking gold prices observed on the CMX exchange, a selected discount rate and perpetual growth rate (Note 9).

Changes in the fair value of this obligation are reported as gain/(loss) on revaluation of deferred consideration—gold payments in the Consolidated Statements of Operations.

consideration—gold payments represented the present value of an obligation to pay gold to a third party into perpetuity and was measured using forward-looking gold prices observed on the CMX exchange, a selected discount rate and perpetual growth rate (Note 9).

Changes in the fair value of this obligation were reported as gain/(loss) on revaluation/termination of deferred consideration—gold payments in the Consolidated Statements of Operations.

Convertible Notes

Convertible notes are carried at amortized cost, net of issuance costs.

In accordance with Accounting Standards Update (“ASU”) 2020-06,

Debt – Debt with Conversion and Other Options

notes are carried at amortized cost, net of issuance costs.

The Company accounts for convertible instruments as a single liability (applicable to the convertible notes) or equity with no separate accounting for embedded conversion features unless the conversion feature meets the criteria for accounting under the substantial premium model or does not qualify for a derivative scope exception.

1 unchanged sentence

Contingencies

The Company may be subject to reviews, inspections and investigations by regulatory authorities as well as legal proceedings arising in the ordinary course of business.

Company may be subject to reviews, inspections and investigations by regulatory authorities as well as legal proceedings arising in the ordinary course of business.

The Company evaluates the likelihood of an unfavorable outcome of all legal or regulatory proceedings to which it is a party and accrues a loss contingency when the loss is probable and reasonably estimable.

Contingent Payments

The Company recognizes a gain on contingent payments when the contingency is resolved and the gain is realized.

Company recognizes a gain on contingent payments when the contingency is resolved and the gain is realized.

Earnings per Share

2 unchanged sentences

The Series A non-voting

convertible preferred stock (Note 11) and unvested share-based payment awards that contain non-forfeitable

convertible preferred stock and Series C non-voting

convertible preferred stock (Note 11) and unvested stock-based equity awards that contain non-forfeitable

rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of EPS pursuant to the two-class

Share-based payment awards that do not contain such rights are not deemed participating securities and are included in diluted shares outstanding (if dilutive).

Diluted EPS is calculated under the treasury stock method and the two-class

Stock-based equity awards that do not contain such rights are not deemed participating securities and are included in diluted shares outstanding (if dilutive).

EPS is calculated under the treasury stock method and the two-class

The calculation that results in the lowest diluted EPS amount for the common stock is reported in the Company’s consolidated financial statements.

The treasury stock method includes the dilutive effect of potential common shares including unvested stock-based awards, the Series A non-voting

convertible preferred stock, the Series C non-voting

convertible preferred stock and the convertible notes, if any.

Potential common shares associated with the Series A non-voting

convertible preferred stock, the Series C non-voting

convertible preferred stock and the convertible notes are computed under the if-converted

Potential common shares associated with the conversion option embedded in the convertible notes are dilutive when the Company’s average stock price exceeds the conversion price.

The Company accounts for income taxes using the liability method, which requires the determination of deferred tax assets and liabilities based on the differences between the financial and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which differences are expected to reverse.

Company accounts for income taxes using the liability method, which requires the determination of deferred tax assets and liabilities based on the differences between the financial and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which differences are expected to reverse.

Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more-likely-than-not

that some portion or all the deferred tax assets will not be realized.

Tax positions are evaluated utilizing a two-step

positions are evaluated utilizing a two-step

The Company first determines whether any of its tax positions are more-likely-than-not

2 unchanged sentences

The Company records interest expense and penalties related to tax expenses as income tax expense.

The Global Intangible Low-Taxed

Global Intangible Low-Taxed

Income (“GILTI”) provisions of the Tax Reform Act requires the Company to include in its U.S.

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Cash and Cash Equivalents

Of the total cash and cash equivalents of $ 119,099 and $ 132,101 at March 31, 2023 and December 31, 2022, $ 118,306 and $ 131,104 , respectively, were held at two financial institutions.

At March 31, 2023 and December 31, 2022, cash equivalents were approximately $ 336 and $ 930 , respectively.

Certain of the Company’s subsidiaries are required to maintain a minimum level of regulatory capital, which was $ 28,726 and $ 25,988 at March 31, 2023 and December 31, 2022, respectively.

the total cash and cash equivalents of $ 83,735 and $ 132,101 at June 30, 2023 and December 31, 2022, $ 82,683 and $ 131,104 , respectively, were held at two financial institutions.

At June 30, 2023 and December 31, 2022, cash equivalents were approximately $ 195 and $ 930 , respectively.

of the Company’s subsidiaries are required to maintain a minimum level of regulatory capital, which was $ 24,912 and $ 25,988 at June 30, 2023 and December 31, 2022, respectively.

These requirements are generally satisfied by cash on hand.

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The hierarchy is broken down into three levels based on the transparency of inputs as follows:

Quoted prices for identical instruments in active markets.

Quoted prices for similar instruments in active markets;

Level 1 – Quoted prices for identical instruments in active markets.

Level 2 – Quoted prices for similar instruments in active markets;

quoted prices for identical or similar instruments in markets that are not active;

and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Instruments whose significant drivers are unobservable.

Level 3 – Instruments whose significant drivers are unobservable.

The availability of observable inputs can vary from product to product and is affected by a wide variety of factors, including, for example, the type of product, whether the product is new and not yet established in the marketplace, and other characteristics particular to the transaction.

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The tables below summarize the categorization of the Company’s assets and liabilities measured at fair value.

During the three months ended March 31, 2023 and 2022, there were no transfers between Levels 2 and 3.

March 31, 2023

During the three and six months ended June 30, 2023 and 2022, there were no transfers between Levels 2 and 3.

June 30, 2023

Recurring fair value measurements:

2 unchanged sentences

Pass-through GSEs

Other assets—seed capital (WisdomTree blockchain-enabled funds)

Investments in Convertible Notes

Securrency, Inc.—convertible note (Note 7)

Fnality International Limited—convertible note (Note 7)

March 31, 2023

Other assets—seed capital (WisdomTree Digital Funds):

Investments in Convertible Notes (Note 7):

Securrency, Inc.—convertible note

Securrency, Inc.—secured convertible note

Fnality International Limited—convertible note

June 30, 2023

Non-recurring

1 unchanged sentence

Securrency, Inc.—Series A convertible preferred stock (1)

Recurring fair value measurements:

Deferred consideration (Note 9)

Fair value determined on March 31, 2023.

December 31, 2022

4 unchanged sentences

Corporate bonds

Other assets—seed capital (WisdomTree blockchain-enabled funds)

Investments in Convertible Notes

Securrency, Inc.—convertible note (Note 7)

Fnality International Limited—convertible note (Note 7)

Other assets—seed capital (WisdomTree Digital Funds)

Investments in Convertible Notes (Note 7)

Securrency, Inc.—convertible note

Fnality International Limited—convertible note

Non-recurring

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Recurring fair value measurements:

Deferred consideration (Note 9)

Fair value determined on March 31, 2023.

Deferred consideration—gold payments (Note 9)

Fair value determined on May 10, 2022.

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– Financial instruments owned are investments in ETFs, U.S.

treasuries, pass-through GSEs, corporate bonds, equities, fixed income and other assets.

treasuries, pass-through GSEs, equities, fixed income and other assets.

treasuries and equities are generally traded in active, quoted and highly liquid markets and are therefore classified as Level 1 in the fair value hierarchy.

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Three Months Ended

Six Months Ended

Investments in Convertible Notes (Note 7)

Beginning balance

Net unrealized losses (1)

Net unrealized gains/(losses) (

Ending balance

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Ending balance

Recorded in other losses, net in the Consolidated Statements of Operations.

Recorded in other gains and losses, net in the Consolidated Statements of Operations.

Recorded as contractual gold payments expense in the Consolidated Statements of Operations.

Recorded as gain/(loss) on revaluation of deferred consideration—gold payments in the Consolidated Statements of Operations.

Recorded as gain/(loss) on revaluation/termination of deferred consideration—gold payments in the Consolidated Statements of Operati on

Financial instruments owned

2 unchanged sentences

Trading securities

Other assets—seed capital (WisdomTree blockchain-enabled funds)

The Company recognized net trading gains/(losses) on financial instruments owned that were still held at the reporting dates of $ 4,722 and ($ 4,316 ) during the three months ended March 31, 2023 and 2022, respectively, which were recorded in other losses, net, in the Consolidated Statements of Operations.

Other assets—seed capital (WisdomTree Digital Funds)

recognized net trading (losses)/gains on financial instruments owned that were still held at the reporting dates of ($ 222 ) and ($ 3,596 ) during the three months ended June 30, 2023 and 2022, respectively, and $ 1,309 and ($ 7,912 ) during the six months ended June 30, 2023 and 2022, respectively, which were recorded in other gains and losses, net, in the Consolidated Statements of Operations.

Securities Held-to-Maturity

2 unchanged sentences

Pass-through GSEs (amortized cost)

During the three months ended March 31, 2023 and 2022, the Company received proceeds of $ 6 and $ 18 , respectively, from held-to-maturity

the six months ended June 30, 2023 and 2022, the Company received proceeds of $ 14 and $ 31 , respectively, from held-to-maturity

securities maturing or being called prior to maturity.

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Gross unrealized losses

Gross unrealized gains

An allowance for credit losses was not provided on the Company’s held-to-maturity

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The following table sets forth the Company’s investments:

March 31, 2023

June 30, 2023

December 31, 2022

1 unchanged sentence

Securrency, Inc.—Series B convertible preferred stock

Securrency, Inc.—secured convertible note

Securrency, Inc.—convertible note

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– Preferred Stock

The Company owns approximately 22 % (or 17 % on a fully-diluted basis) of the capital stock of Securrency, Inc.

Company owns approximately 22 % (or 17 % on a fully-diluted basis) of the capital stock of Securrency, Inc.

(“Securrency”), a developer of institutional-grade blockchain-based financial and regulatory technology, issued as a result of strategic investments totaling $ 13,612 .

In consideration of such investments, the Company received 5,178,488 shares of Series A convertible preferred stock (“Securrency Series A Shares”) in December

2019 and 2,004,665 shares of Series B convertible preferred stock (“Securrency Series B Shares”) in March 2021.

In consideration of such investments, the Company received 5,178,488 shares of Series A convertible preferred stock (“Securrency Series A Shares”) in December 2019 and 2,004,665 shares of Series B convertible preferred stock (“Securrency Series B Shares”) in March 2021.

The Securrency Series B Shares contain a liquidation preference that is pari passu with shares of Series B-1

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In addition, the Securrency Series A Shares and Securrency Series B Shares (together with the Securrency Series B-1

60 % of the Securrency

Series A Shares (at any time on or after December 31, 2029) and

of the Securrency Series B Shares (at any time on or after March 31, 2031).

These investments are accounted for under the measurement alternative prescribed in ASC 321, as they do not have a readily determinable fair value and are not considered to be in-substance

convertible preferred stock) are separately redeemable, with respect to all of the shares outstanding of the applicable series of preferred stock (subject to certain regulatory restrictions of certain investors), for the original issue price thereof, plus all declared and unpaid dividends, upon approval by holders of at least 60 % of the Securrency Series A Shares (at any time on or after December 31, 2029) and 90 % of the Securrency Series B Shares (at any time on or after March 31, 2031).

se investments are accounted for under the measurement alternative prescribed in ASC 321, as they do not have a readily determinable fair value and are not considered to be in-substance

common stock.

The investments are assessed for impairment and similar observable transactions on a quarterly basis.

During the three months ending March, 31, 2023, the Company recognized an impairment of $ 4,900 on its Securrency Series A Shares to reduce the carrying value of its investment to fair value.

impairment recognized during the three months ended June 30, 2023 based upon a qualitative assessment.

During the six months ended June 30, 2023, the Company recognized an impairment of $ 4,900

on its Securrency Series A Shares to reduce the carrying value of its investment to fair value.

Fair value was determined using the probability-weighted expected return method (“PWERM”), a valuation approach that estimates fair value assuming various outcomes.

The table below presents the probability ascribed to potential outcomes used in the PWERM (classified as Level 3 in the fair value hierarchy):

Conversion of Securrency Series A Shares upon a future equity financing

Redemption of Securrency Series A Shares upon a corporate transaction

There was no impairment recognized during the three months ended March 31, 2022 based upon a qualitative assessment.

Securrency – Convertible Note

In April and November 2022, the Company participated in a convertible note financing, making an aggregate investment of $ 15,000 in convertible notes of Securrency.

In consideration for its investment, the Company was issued a 7 % Convertible Promissory Note maturing on

The table below presents the probability ascribed to potential outcomes used in the PWERM, which resulted in the mark-down of the Securrency Series A Shares (classified as Level 3 in the fair value hierarchy).

There was no mark-down applied to the Securrency Series B Shares, as they are a senior instrument.

Conversion upon a future equity financing

Redemption upon a corporate transaction

e was no impairment recognized during the three and six months ended June 30, 2022 based upon a qualitative assessment.

Securrency – Secured Convertible Note

In June 2023, the Company provided funding in the amount of $ 10,000 , and in consideration therefor, the Company was issued a

9 % Secured Convertible Promissory Note maturing on December 31, 2023 .

The note is guaranteed by a U.S.-based wholly-owned subsidiary of Securrency and is secured by a valid and perfected first priority security interest in all existing and after acquired assets and personal property of the borrower, including all intellectual property and a pledge of non-regulated

subsidiary equity.

note is convertible into Securrency’s preferred stock that is issued in the event of a qualified future equity financing of Securrency, subject to the Company’s right to require repayment, in whole or in part, to the extent such conversion would result in the Company obtaining a control position in Securrency.

The note will convert at a conversion price equal to a discount of 25 % to the price paid per share of preferred stock issued in such future equity financing round.

note is redeemable upon the occurrence of a corporate transaction for an amount which is the greater of (i) an amount equal to (x) 1.25 times (y) the sum of the principal amount and all accrued interest of the note (the “Liquidity Premium”) and (ii) such amount as would have been payable to the Company if the note had been converted, immediately prior to such corporate transaction, into that number of shares of the then most senior series of preferred stock of Securrency obtained by dividing (A) the Liquidity Premium by (B) the applicable conversion price, as set forth in the note.

If not otherwise converted or redeemed, all unpaid interest accrued on the note and all (if any) other amounts payable on or in respect of the note or the indebtedness evidenced thereby owing to the Company will become immediately due and payable.

note is accounted for at fair value.

Fair value is determined by the Company using the PWERM.

During the three months ended June 30, 2023, the Company recognized an unrealized loss of $ 1,113 when re-measuring

the note to fair value.

table below presents the probability ascribed to potential outcomes used in the PWERM (classified as Level 3 in the fair value hierarchy).

Conversion of note upon a future equity financing

Redemption of note upon a corporate transaction

Time to potential outcome (in years)

Securrency – Convertible Notes

April and November 2022, the Company participated in a convertible note financing, making an aggregate investment of $ 15,000 in convertible notes of Securrency.

In consideration for its investment, the Company was issued 7 % Convertible Promissory Notes maturing on

October 20, 2023 .

The notes are convertible into either common stock or a class of securities convertible into, exchangeable for, or conferring the right to purchase Securrency’s common stock that is issued in the event of a future equity financing of Securrency.

notes are convertible into either common stock or a class of securities convertible into, exchangeable for, or conferring the right to purchase Securrency’s common stock that is issued in the event of a qualified future equity financing of Securrency.

The notes will convert at a conversion price equal to a discount of 25% (or, if applicable, a greater discount offered to other holders of convertible securities in such future equity financing round) to the lowest price paid per equity share issued in the future equity financing round.

The notes are redeemable upon the occurrence of a corporate transaction for an amount which is the greater of (i) the principal amount and all accrued interest and (ii) the amount that would be received had the note been converted, in accordance with the terms of the notes, to common stock immediately prior to the occurrence of the corporate transaction.

notes are redeemable upon the occurrence of a corporate transaction for an amount which is the greater of (i) the principal amount and all accrued interest and (ii) the amount that would be received had the note been converted, in accordance with the terms of the notes, to common stock immediately prior to the occurrence of the corporate transaction.

At maturity, redemption or conversion may occur upon the election by the holders of a majority-in-interest

of the aggregate principal amount of outstanding notes.

If no such election is made, Securrency may elect to pay or convert the notes in its sole discretion.

The notes are accounted for at fair value.

Fair value is determined by the Company using PWERM.

During the three months ended March 31, 2023, the Company recognized an unrealized loss of $ 4,449 when re-measuring

the notes to fair value.

If no such election is made, the Company may elect to convert the notes into common stock, in accordance with the terms of the notes, or require repayment of the aggregate principal and interest thereon.

notes are accounted for at fair value.

Fair value is determined by the Company using the PWERM.

When re-measuring

the notes to fair value, the Company recognized an unrealized gain of $ 3,785 during the three months ended June 30, 2023, and an unrealized loss of $ 664 during the six months ended June 30, 2023.

The table below presents the probability ascribed to potential outcomes used in the PWERM (classified as Level 3 in the fair value hierarchy) and the time to exit:

Conversion of note upon a future equity financing

Redemption of note upon a corporate transaction

Conversion of notes upon a future equity financing

Redemption of notes upon a corporate transaction

Time to potential outcome (in years)

Fnality International Limited – Convertible Note

In February 2022, the Company participated in a convertible note financing, making an investment of £ 5,000 ($ 6,863 ) in convertible notes of Fnality International Limited (“Fnality”), a company incorporated in England and Wales and focused on creating a peer-to-peer

February 2022, the Company participated in a convertible note financing, making an investment of £ 5,000 ($ 6,863 ) in convertible notes of Fnality International Limited (“Fnality”), a company incorporated in England and Wales and focused on creating a peer-to-peer

digital wholesale settlement ecosystem comprised of a consortium of financial institutions, offering real time cross-border payments from a single pool of liquidity.

In consideration for its investment, the Company was issued a 5 % Convertible Unsecured Loan Note maturing on December 31, 2023 .

The note is convertible into equity shares in the event of a future equity financing of Fnality.

The note will convert at a conversion price equal to the lower of (i) a discount of 20 % to lowest price paid per equity share issued pursuant to such future financing round and (ii) an amount paid per share subject to a pre-money

note is convertible into equity shares in the event of a future qualified equity financing of Fnality.

The note will convert at a conversion price equal to the lower of (i) a discount of 20 % to the lowest price paid per equity share issued pursuant to such future financing round and (ii) an amount paid per share subject to a pre-money

valuation cap.

Mandatory conversion may occur on or after the maturity date or, if earlier, in the event a future financing round has not been completed within a specified time from an initial closing of such financing round (“Long Stop Date”), upon the approval of holders of at least 75 % of the outstanding notes.

75 % of the outstanding notes.

The note is also convertible, at the option of the Company, following the earlier of the maturity date or such Long Stop Date.

The note is redeemable upon the occurrence of a change of control for an amount which is the greater of (i) the principal amount and all accrued interest and (ii) the amount that would be received had the note been converted to equity shares immediately prior to the occurrence of the change of control.

note is redeemable upon the occurrence of a change of control for an amount which is the greater of (i) the principal amount and all accrued interest and (ii) the amount that would be received had the note been converted to equity shares immediately prior to the occurrence of the change of control.

Redemption may also occur on or after maturity or prior to maturity upon approval by holders of at least 50 % and 75 %, respectively, of the outstanding notes, or in connection with bankruptcy or other liquidation events.

The note is accounted for at fair value.

note is accounted for at fair value.

Fair value is determined by the Company using the PWERM and is also remeasured for changes in the British pound and U.S.

dollar exchange rate.

During the three months ended March 31, 2023, the Company recognized a gain of $ 530 when re-measuring

During the three and six months ended June 30, 2023, the Company recognized a gain of $ 428 and $ 958 , respectively, when re-measuring

the notes to fair value.

The table below presents the probability ascribed to potential outcomes used in the PWERM (classified as Level 3 in the fair value hierarchy) and the time to exit:

Conversion of note upon a future financing round

Conversion of note upon a future financing

Redemption of note upon a change of control

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accumulated depreciation

Deferred Consideration

Deferred consideration represents an obligation the Company assumed in connection with its acquisition of the European exchange-traded commodity, currency and leveraged-and-inverse

business of ETFS Capital Limited (“ETFS Capital”) which occurred on April 11, 2018 (“ETFS Acquisition”).

The obligation is for fixed payments to ETFS Capital of physical gold bullion equating to 9,500 ounces of gold per year through March 31, 2058 and then subsequently reduced to 6,333 ounces of gold per year continuing into perpetuity (“Contractual Gold Payments”).

The Contractual Gold Payments are paid from advisory fee income generated by any Company-sponsored financial product backed by physical gold and are subject to adjustment and reduction for declines in advisory fee income generated by such products, with any reduction remaining due and payable until paid in full.

ETFS Capital’s recourse is limited to such advisory fee income and it has no recourse back to the Company for any unpaid amounts that exceed advisory fees earned.

ETFS Capital ultimately has the right to claw back Gold Bullion Securities Ltd.

(a physically backed gold ETP issuer) if the Company fails to remit any amounts due.

The Company determined the present value of the deferred consideration of $ 179,831 and $ 200,290 at March 31, 2023 and December 31, 2022 using the following assumptions:

Deferred Consideration—Gold Payments

consideration—gold payments represented an obligation the Company assumed in connection with its acquisition of the European exchange-traded commodity, currency and leveraged-and-inverse

business of ETFS Capital Limited (“ETFS Capital”) which occurred on April 11, 2018.

The obligation was for fixed payments to ETFS Capital of physical gold bullion equating to 9,500 ounces of gold per year through March 31, 2058 and then subsequently reduced to 6,333 ounces of gold per year continuing into perpetuity (“contractual gold payments”).

ETFS Capital continued to pass through the payments to other parties to meet its payment obligations under prior royalty agreements, including to Gold Bullion Holdings

(Jersey) Limited (“GBH”), a subsidiary of the World Gold Council (“WGC”), Graham Tuckwell (“GT”), and Rodber Investments Limited (“RIL”), an entity controlled by GT, who is also the Chairman of ETFS Capital.

May 10, 2023, the Company terminated its contractual gold payments obligation for aggregate consideration totaling $ 136,903 pursuant to a Sale, Purchase and Assignment Deed (the “SPA Agreement”) with WisdomTree International Holdings Ltd, Electra Target HoldCo Limited, ETFS Capital, WGC, GBH, GT and RIL.

Under the terms of the transaction, GBH received approximately $ 4,371 in cash and 13,087 shares of Series C Non-Voting

Convertible Preferred Stock of the Company, $ 0.01 par value per share, convertible into

13,087,000 shares of the Company’s common stock, and RIL received approximately $ 45,634 in cash.

e Company determined the present value of the deferred consideration—gold payments of $ 0 and $ 200,290 at June 30, 2023 and December 31, 2022 using the following assumptions:

Forward-looking gold price (low)—per ounce

Forward-looking gold price (high)—per ounce

Forward-looking gold price (weighted average)—per ounce

Forward-looking gold price (weighted average)—per

Discount rate

Perpetual growth rate

Fair value as of March 31, 2023 was determined using an equal weighting of a discounted cash flow approach and market approach.

The forward-looking gold prices at March 31, 2023 were extrapolated from the last observable CMX exchange price (beyond 2028) and the weighted-average price per ounce was derived from the relative present values of the annual payment obligations.

The perpetual growth rate at March 31, 2023 was determined based upon the increase in observable forward-looking gold prices through 2028.

This obligation is classified as Level 3 as the discount rate, the extrapolated forward-looking gold prices and perpetual growth rate are significant unobservable inputs.

An increase in spot gold prices, forward-looking gold prices and the perpetual growth rate would result in an increase in deferred consideration, whereas an increase in the discount rate would reduce the fair value.

Current amounts payable were $ 17,984 and $ 16,796 and long-term amounts payable were $ 161,847 and $ 183,494 at March 31, 2023 and December 31, 2022, respectively.

During the three months ended March 31, 2023 and 2022, the Company recognized the following in respect of deferred consideration:

During the three and six months ended June 30, 2023 and 2022, the Company recognized the following in respect of deferred consideration—gold payments:

Three Months Ended

Six Months Ended

Contractual gold payments

Contractual gold payments—gold ounces paid

Gain/(loss) on revaluation of deferred consideration—gold payments (1)

Gains on revaluation of deferred consideration—gold payments result from a decrease in spot gold prices, a decrease in the forward-looking price of gold, a decrease in the perpetual growth rate and an increase in the discount rate used to compute the present value of the annual payment obligations.

Losses on revaluation of deferred consideration—gold payments result from an increase in spot gold prices, an increase in the forward-looking price of gold, an increase in the perpetual growth rate and a decrease in the discount rate used to compute the present value of the annual payment obligations.

Gain/(loss) on revaluation/termination of deferred

consideration—gold

Convertible Notes

On February 14, 2023, the Company issued and sold $ 130,000 in aggregate principal amount of 5.75 % Convertible Senior Notes due 2028 (the “2023 Notes”) pursuant to an indenture dated February 14, 2023, between the Company and U.S.

February 14, 2023, the Company issued and sold $ 130,000 in aggregate principal amount of 5.75 % Convertible Senior Notes due 2028 (the “2023 Notes”) pursuant to an indenture dated February 14, 2023, between the Company and U.S.

Bank Trust Company, National Association, as trustee (or its successor in interest, the “Trustee”), in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (“Rule 144A”).

On June 14, 2021, the Company issued and sold $ 150,000 in aggregate principal amount of 3.25 % Convertible Senior Notes due 2026 (the “2021 Notes”) pursuant to an indenture dated June 14, 2021, between the Company and the Trustee, in a private offering to qualified institutional buyers pursuant to Rule 144A.

On June 16, 2020, the Company issued and sold $ 150,000 in aggregate principal amount of 4.25 % Convertible Senior Notes due 2023 (the “June 2020 Notes”) pursuant to an indenture dated June 16, 2020, between the Company and the Trustee, in a private offering to qualified institutional buyers pursuant to Rule 144A.

On August 13, 2020, the Company issued and sold $ 25,000 in aggregate principal amount of 4.25 % Convertible Senior Notes due 2023 at a price equal to 101% of the principal amount thereof, plus interest deemed to have accrued since June 16, 2020, and constitute a further issuance of, and form a single series with, the Company’s June 2020 Notes (the “August 2020 Notes” and together with the June 2020 Notes, the “2020 Notes”).

In connection with the issuance of the 2023 Notes, the Company repurchased $ 115,000 in aggregate principal amount of the 2020 Notes.

As a result of this repurchase, the Company recognized a loss on extinguishment of approximately $ 9,721 during the three months ended March 31, 2023.

After the issuance of the 2023 Notes (and together with the remaining 2020 Notes and the 2021 Notes, the “Convertible Notes”), the Company had $ 340,000 in aggregate principal amount of Convertible Notes outstanding.

June 14, 2021, the Company issued and sold $ 150,000 in aggregate principal amount of 3.25 % Convertible Senior Notes due 2026 (the “2021 Notes”) pursuant to an indenture dated June 14, 2021, between the Company and the Trustee, in a private offering to qualified institutional buyers pursuant to Rule 144A.

June 16, 2020, the Company issued and sold $ 150,000 in aggregate principal amount of 4.25 % Convertible Senior Notes due 2023 (the “June 2020 Notes”) pursuant to an indenture dated June 16, 2020, between the Company and the Trustee, in a private offering to qualified institutional buyers pursuant to Rule 144A.

On August 13, 2020, the Company issued and sold $ 25,000 in aggregate principal amount of 4.25 % Convertible Senior Notes due 2023 at a price equal to 101% of the principal amount thereof, plus interest deemed to have accrued since June 16, 2020, which constitute a further issuance of, and form a single series with, the Company’s June 2020 Notes (the “August 2020 Notes” and together with the June 2020 Notes, the “2020 Notes”).

connection with the issuance of the 2023 Notes, the Company repurchased $ 115,000 in aggregate principal amount of the 2020 Notes.

As a result of this repurchase, the Company recognized a loss on extinguishment of approximately $ 9,721 during the six months ended June 30, 2023.

The remainder of the 2020 Notes matured on June 15, 2023 and were settled for $ 59,955 in cash and 1,037,288 shares of common stock, as the conversion option was in the money.

the repurchase and maturity of the 2020 Notes and the issuance of the 2023 Notes (and together with the 2021 Notes, the “Convertible Notes”), the Company had $ 280,000 in aggregate principal amount of Convertible Notes outstanding.

Key terms of the Convertible Notes are as follows:

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June 15, 2026

June 15, 2023

Interest rate

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Interest rate:

Payable semiannually in arrears on February 15 and August 15 of each year for the 2023 Notes (beginning on August 15, 2023) and June 15 and December 15 of each year for the 2020 Notes and the 2021 Notes.

Payable semiannually in arrears on February 15 and August 15 of each year for the 2023 Notes (beginning on August 15, 2023) and on June 15 and December 15 of each year for the 2021 Notes.

Conversion price:

Convertible at an initial conversion rate into shares of the Company’s common stock, per $ 1,000 principal amount of notes (equivalent to an initial conversion price set forth in the table above), subject to adjustment.

Holders may convert at their option at any time prior to the close of business on the business day immediately preceding May 15, 2028, March 15, 2026 and March 15, 2023 for the 2023 Notes, 2021 Notes and 2020 Notes, respectively, only under the following circumstances:

Holders may convert at their option at any time prior to the close of business on the business day immediately preceding May 15, 2028 and March 15, 2026 for the 2023 Notes and 2021 Notes, respectively, only under the following circumstances:

(i) if the last reported sale price of the Company’s common stock for at least 20 trading days during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price for the respective Convertible Notes on each applicable trading day;

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or (iv) upon the occurrence of specified corporate events.

On or after May 15, 2028, March 15, 2026 and March 15, 2023 in respect of the 2023 Notes, 2021 Notes and 2020 Notes, respectively, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances.

On or after May 15, 2028 and March 15, 2026 in respect of the 2023 Notes and the 2021 Notes, respectively, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances.

Cash settlement of principal amount:

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Redemption price:

The Company may redeem for cash all or any portion of the Convertible Notes, at its option, on or after August 20, 2025, June 20, 2023 and June 20, 2021 in respect of the 2023 Notes, 2021 Notes and 2020 Notes, respectively, and on or prior to the 55th scheduled trading day immediately preceding the maturity date, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price for the respective

Convertible Notes then in effect for at least 20 trading days, including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date.

The Company may redeem for cash all or any portion of the Convertible Notes, at its option, on or after August 20, 2025 and June 20, 2023 in respect of the 2023 Notes and the 2021 Notes, respectively, and on or prior to the 55 th

scheduled trading day immediately preceding the maturity date, if the last reported sale price of the Company’s common stock has been at least 130 % of the conversion price for the respective Convertible Notes then in effect for at least 20 trading days, including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date.

No sinking fund is provided for the Convertible Notes.

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Conversion rate increase in certain customary circumstances:

In certain circumstances, conversions in connection with a “make-whole fundamental change” (as defined in the indentures) or conversions of Convertible Notes called (or deemed called) for redemption may result in an increase to the conversion rate, provided that the conversion rate will not exceed 167.7853 shares, 144.9275 shares and 270.2702 shares of the Company’s common stock per $1,000 principal amount of the 2023 Notes, 2021 Notes and 2020 Notes, respectively (the equivalent of 59,767,426 shares of the Company’s common stock), subject to adjustment.

In certain circumstances, conversions in connection with a “make-whole fundamental change” (as defined in the indentures) or conversions of Convertible Notes called (or deemed called) for redemption may result in an increase to the conversion rate, provided that the conversion rate will not exceed 167.7853 shares and 144.9275 shares of the Company’s common stock per $ 1,000 principal amount of the 2023 Notes and the 2021 Notes, respectively (the equivalent of 43,551,214 shares of the Company’s common stock), subject to adjustment.

Seniority and Security:

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Convertible Preferred Stock (Note 11).

The indentures contain customary terms and covenants, including that upon certain events of default occurring and continuing, either the Trustee or the holders of not less than 25 % in aggregate principal amount of the Convertible Notes outstanding may declare the entire principal amount of all the Convertible Notes to be repurchased, plus any accrued special interest, if any, to be immediately due and payable.

The following table provides a summary of the carrying value of the Convertible Notes at March 31, 2023 and December 31, 2022:

March 31, 2023

indentures contain customary terms and covenants, including that upon certain events of default occurring and continuing, either the Trustee or the respective holders of not less than 25

% in aggregate principal amount of the respective series of

Convertible Notes outstanding may declare the entire principal amount of all such respective Convertible Notes to be repurchased, plus any accrued special interest, if any, to be immediately due and payable.

following table provides a summary of the Convertible Notes at June 30, 2023 and December 31, 2022:

June 30, 2023

December 31, 2022

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Includes amortization of the issuance costs and premium.

Interest expense on the Convertible Notes during the three months ended March 31, 2023 and 2022 was $ 4,002 and $ 3,732 , respectively.

Interest payable of $ 3,243 and $ 621 at March 31, 2023 and December 31, 2022, respectively, is included in accounts payable and other liabilities on the Consolidated Balance Sheets.

The fair value of the Convertible Notes (classified as Level 2 in the fair value hierarchy) was $ 331,766 and $ 320,513 at March 31, 2023 and December 31, 2022, respectively.

expense on the Convertible Notes was $ 4,021 and $ 8,023 during the three and six months ended June 30, 2023 and $ 3,733 and $ 7,465 , respectively, during the comparable periods in 2022.

Interest payable of $ 3,061 and $ 621 at June 30, 2023 and December 31, 2022, respectively, is included in accounts payable and other liabilities on the Consolidated Balance Sheets.

fair value of the Convertible Notes (classified as Level 2 in the fair value hierarchy) was $ 280,671 and $ 320,513 at June 30, 2023 and December 31, 2022, respectively.

The if-converted

value of the Convertible Notes did not exceed the principal amount at March 31, 2023 and December 31, 2022.

Series A Preferred Stock

On April 10, 2018, the Company filed a Certificate of Designations of Series A Non-Voting

value of the Convertible Notes did not exceed the principal amount at June 30, 2023 and December 31, 2022.

Preferred Stock

Series A Non-Voting

Convertible Preferred Stock

April 10, 2018, the Company filed a Certificate of Designations of Series A Non-Voting

Convertible Preferred Stock (the “Series A Certificate of Designations”) with the Delaware Secretary of State establishing the rights, preferences, privileges, qualifications, restrictions, and limitations relating to the Series A Preferred Stock (defined below).

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The Series A Preferred Stock has no voting rights, is not transferable and has the same priority with regard to dividends, distributions and payments as the common stock.

As described in the Series A Certificate of Designations, the Company will not issue, and ETFS Capital does not have the right to require the Company to issue, any shares of common stock upon conversion of the Series A Preferred Stock, if, as a result of such conversion, ETFS Capital (together with certain attribution parties) would beneficially own more than 9.99% of the Company’s outstanding common stock immediately after giving effect to such conversion.

In connection with the completion of the ETFS Acquisition, the Company issued 14,750 shares of Series A Non-Voting

described in the Series A Certificate of Designations, the Company will not issue, and ETFS Capital does not have the right to require the Company to issue, any shares of common stock upon conversion of the Series A Preferred Stock, if, as a result of such conversion, ETFS Capital (together with certain attributable parties) would beneficially own more than 9.99% of the Company’s outstanding common stock immediately after giving effect to such conversion.

connection with the completion of the acquisition of the European exchange-traded commodity, currency and leveraged-and-inverse

business of ETFS Capital (the “ETFS Acquisition”), the Company issued 14,750 shares of Series A Non-Voting

Convertible Preferred Stock (the “Series A Preferred Stock”), which are convertible into an aggregate of 14,750,000 shares of common stock.

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or (b) ETFS Capital does not, upon completion of a change of control of the Company, receive the same amount per Series A Preferred Stock as it would have received had each outstanding Series A Preferred Stock been converted into common stock immediately prior to the change of control.

However, the Company will not be obligated to make any such redemption payments to the extent such payments would be a breach of any covenant or obligation the Company owes to any of its secured creditors or is otherwise prohibited by applicable law.

Any such redemption will be at a price per Series A Preferred Stock equal to the dollar volume-weighted average price for a share of common stock for the 30-trading

However, the Company will not be obligated to make any such redemption payments to the extent such payments would be a breach of any covenant or obligation the Company

owes to any of its secured creditors or is otherwise prohibited by applicable law.

such redemption will be at a price per Series A Preferred Stock equal to the dollar volume-weighted average price for a share of common stock for the 30-trading

day period ending on the date of such attempted conversion or change of control, as applicable, multiplied by 1,000

Such redemption payment will be made in one payment no later than 10 business days following the last day of the Company’s first fiscal quarter that begins on a date following the date ETFS Capital exercises such redemption right.

The redemption value of the Series A Preferred Stock was $ 86,638 and $ 77,969 at March 31, 2023 and December 31, 2022, respectively.

The carrying amount of the Series A Preferred Stock was not adjusted as it was not probable that the Series A Preferred Stock would become redeemable.

The Company has entered into operating leases for its office facilities (including its corporate headquarters) and equipment.

Such redemption payment will be made in one payment no later than 10

business days following the last day of the Company’s first fiscal quarter that begins on a date following the date ETFS Capital exercises such redemption right.

The redemption value of the Series A Preferred Stock was $ 103,480 and $ 77,969 at June 30, 2023 and December 31, 2022, respectively.

carrying amount of the Series A Preferred Stock was not adjusted as it was not probable that the Series A Preferred Stock would become redeemable.

Series C Non-Voting

Convertible Preferred Stock

May 10, 2023, the Company filed a Certificate of Designations of Series C Non-Voting

Convertible Preferred Stock (the “Series C Certificate of Designations”) with the Delaware Secretary of State establishing the rights, preferences, privileges, qualifications, restrictions, and limitations relating to the Series C Preferred Stock (defined below).

The Series C Preferred Stock is intended to provide GBH with economic rights equivalent to the Company’s common stock on an as-converted

The Series C Preferred Stock has no voting rights, is not transferable, contains registration rights and has the same priority with regard to dividends, distributions and payments as the common stock.

described in the Series C Certificate of Designations, the Company will not issue, and GBH does not have the right to require the Company to issue, any shares of common stock upon conversion of the Series C Preferred Stock, if, as a result of such conversion, GBH (together with certain attributable parties) would beneficially own more than 4.99 % of the Company’s outstanding common stock immediately after giving effect to such conversion.

Further, as described in the Series C Certificate of Designations, the Company will no t issue any shares of common stock upon conversion of the Series C Preferred Stock if the issuance would exceed the aggregate number of shares of common stock that the Company may issue without breaching its obligations under the rules of the New York Stock Exchange, unless the Company obtains stockholder approval for the issuance of the Company’s common stock upon conversion of the Series C Preferred Stock in excess of such amount.

h share of Series C Preferred Stock is convertible only in connection with the sale of all or any portion of the Company’s common stock on an arms-length basis to a bona fide third-party purchaser, pursuant to (i) an effective registration statement under the Securities Act of 1933, as amended (“Securities Act”) or (ii) an exemption from registration under the Securities Act, provided any such sale is conditioned on the terms set forth in the Investor Rights Agreement, dated May 10, 2023, between the Company and GBH.

to the Investor Rights Agreement, GBH is subject to restrictions on the manner in which the Conversion Shares (defined below) can be sold and has agreed not to distribute or sell any Conversion Shares to any person that would knowingly result in that person, together with such person’s affiliates and associates, owning, controlling or otherwise having any beneficial ownership interest representing in the aggregate 5% or more of the then outstanding shares of the Company’s common stock.

GBH has also agreed not to distribute or sell any Conversion Shares to ETFS Capital, GT or any of their affiliates, associates or any Group (as that term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and as defined in Rule 13d-5

thereunder) formed by the foregoing persons.

accordance with the SPA Agreement, the Company issued 13,087 shares of Series C Non-Voting

Convertible Preferred Stock (the “Series C Preferred Stock”), which are convertible into an aggregate of 13,087,000 shares of common stock (“Conversion Shares”).

The fair value of this consideration was $ 86,898 , based on the closing price of the Company’s common stock on May 9, 2023 of $ 6.64 per share, the trading day prior to the closing of the acquisition.

has no redemption rights associated with the Series C Preferred Stock and therefore the instrument has been classified as a component of stockholders’ equity, with the excess over par value of $ 86,801 (net of issuance costs of $ 97 ) recorded to additional paid in capital.

Company has entered into operating leases for its office facilities (including its corporate headquarters) and equipment.

The Company has no finance leases.

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Three Months Ended

Six Months Ended

Operating lease cost

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Weighted-average discount rate—operating leases

None of the Company’s leases include variable payments, residual value guarantees or any restrictions or covenants relating to the Company’s ability to pay dividends or incur additional financing obligations.

The following table discloses future minimum lease payments at March 31, 2023 with respect to the Company’s operating lease liabilities:

None of the Comp a

ny’s leases include variable payments, residual value guarantees or any restrictions or covenants relating to the Company’s ability to pay dividends or incur additional financing obligations.

The following table discloses future minimum lease payments at June 30, 2023 with respect to the Company’s operating lease liabilities:

Remainder of 2023

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Total future minimum lease payments (undiscounted)

The following table reconciles the future minimum lease payments (disclosed above) at March 31, 2023 to the operating lease liabilities recognized in the Company’s Consolidated Balance Sheets:

The following table reconciles the future minimum lease payments (disclosed above) at June 30, 2023 to the operating lease liabilities recognized in the Company’s Consolidated Balance Sheets:

Amounts recognized in the Company’s Consolidated Balance Sheets

Lease liability—short term

Lease liability—long term

Difference between undiscounted and discounted cash flows

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These writs also were served on the intermediary brokers for the respective claimants, with the claimants alleging joint and several liability of WMAI, WTUK and such intermediary brokers.

Total damages sought by all investors are approximately € 15,800 ($ 17,186 ) at March 31, 2023.

In July 2023, the Court of Milan ruled in favor of WMAI and WTUK in respect of one of these claims.

Total damages sought by all investors related to these claims are approximately € 15,200 ($ 16,560 ) at June 30, 2023.

Additionally, in July 2023, WT Ireland received a letter from counsel on behalf of additional investors seeking damages of up to approximately €

8,400 ($ 9,150 )

resulting from the closure of 3OIL.

The claim is in its preliminary stages and a writ of summons has not been served.

The Company is currently assessing these claims with its external counsel.

An accrual has not been made with respect to these matters at March 31, 2023 and December 31, 2022.

The Company expects that losses, if any, arising from these claims will be covered under its insurance policies, less a $ 500

An accrual has not been made with respect to these matters at June 30, 2023 and December 31, 2022.

Variable Interest Entities

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Carrying Amount—Assets (Securrency):

Preferred stock—Series A Shares

Preferred stock—Series B Shares

Preferred stock—Securrency Series A Shares

Preferred stock—Securrency Series B Shares

Secured convertible note

Convertible note

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The following table presents the Company’s total revenues from contracts with customers:

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Revenues from contracts with customers:

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Progress is measured using the practical expedient under the output method resulting in the recognition of revenue in the amount for which the Company has a right to invoice.

There are no contract assets or liabilities that arise in connection with the recognition of advisory fee revenue.

are no contract assets or liabilities that arise in connection with the recognition of advisory fee revenue.

In addition, there are no costs incurred to obtain or fulfill the contracts with customers, all of which are investment advisory agreements with related parties.

Other income includes revenues the Company earns

from swap providers associated with certain of the Company’s European-listed ETPs, the nature of which are either based on a percentage of the ETPs’ average daily net assets or flows associated with certain products.

There is no significant judgment in calculating amounts due ,

which are invoiced monthly or quarterly in arrears and are not subject to any potential reversal.

Other income includes revenues the Company earns from swap providers associated with certain of the Company’s European listed ETPs, the nature of which are either based on a percentage of the ETPs’ average daily net assets or flows associated with certain products.

There is no significant judgment in calculating amounts due, which are invoiced monthly or quarterly in arrears and are not subject to any potential reversal.

Progress is measured using the practical expedient under the output method resulting in the recognition of revenue in the amount for which the Company has a right to invoice.

Geographic Distribution of Revenue

Geographic Distribution of Revenues

The following table presents the Company’s total revenues geographically as determined by where the respective management companies reside:

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Revenues from contracts with customers:

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Related Party Transactions

Investment Advisory Agreements

The Company’s revenues are derived primarily from investment advisory agreements with related parties.

Under these agreements, the Company has licensed to related parties the use of certain of its own indexes for the U.S.

WisdomTree ETFs and WisdomTree UCITS ETFs.

WisdomTree ETFs, Digital Funds and WisdomTree UCITS ETFs.

The Board of Trustees and Board of Directors (including certain officers of the Company) of the related parties are primarily responsible for overseeing the management and affairs of the entities for the benefit of their stakeholders and have contracted with the Company to provide for general management and administration services.

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services, excluding extraordinary expenses, taxes and certain other expenses, which are included in fund management and administration in the Consolidated Statements of Operations.

In exchange, the Company receives fees based on a percentage of the ETPs’ average daily net assets.

A majority of the independent members of the Board of Trustees are required to annually approve the advisory agreements of the U.S.

WisdomTree ETFs and these agreements may be terminated by the Board of Trustees upon notice.

In exchange, the Company receives fees based on a percentage of the ETPs’ and the Digital Funds’ average daily net assets.

A majority of the independent members of the Board of Trustees are required to initially and annually (after the first two years) approve the advisory agreements of the U.S.

WisdomTree ETFs and the Digital Funds and these agreements may be terminated by the Board of Trustees upon notice.

The following table summarizes accounts receivable from related parties which are included as a component of accounts receivable in the Consolidated Balance Sheets:

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The following table summarizes revenues from advisory services provided to related parties:

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Advisory services provided to WTT

Advisory services provided to ManJer Issuers

Advisory services provided to WMAI and WTICAV

The Company also has investments in certain WisdomTree products of approximately $ 45,214 and $ 25,283 at March 31, 2023 and December 31, 2022, respectively.

This includes $ 12,413 and $ 1,765 , respectively, of investments in certain consolidated affiliated blockchain-enabled funds advised by WT Digital Management, referred to herein as “other assets–seed capital.” Net unrealized and realized gains/(losses) related to trading WisdomTree products during the three months ended March 31, 2023 and 2022

were $ 422 and ($ 806 ), respectively, which are recorded in other losses, net on the Consolidated Statements of Operations.

Advisory services provided to ManJer

Advisory services provided to WMAI

Investments in WisdomTree Products

Company also has investments in certain WisdomTree products of approximately $ 38,451 and $ 25,283 at June 30, 2023 and December 31, 2022, respectively.

This includes $ 12,876 and $ 1,765 , respectively, of investments in certain consolidated affiliated Digital Funds advised by WT Digital Management, referred to herein as “other assets–seed capital.” Net unrealized and realized gains/(losses) related to trading WisdomTree products were $ 419 and $ 841 , respectively, during the three and six months ended June 30, 2023 and ($ 313 ) and ($ 1,119 ), respectively, during the comparable periods in 2022.

Such gains and losses are recorded in other gains and losses, net on the Consolidated Statements of Operations.

Deferred Consideration—Gold Payments – Termination

n May 10, 2023, the Company terminated its contractual gold payments obligation to ETFS Capital, which included the payment of $ 45,634 to an entity controlled by GT, a stockholder of the Company.

See Note 9 for additional information.

Stock-Based Awards

On July 15, 2022, the Company’s stockholders approved the 2022 Equity Plan under which the Company may issue up to 16,000,000 shares of common stock (less one share for every share granted under the 2016 Equity Plan since March 31, 2022 and inclusive of shares available under the 2016 Equity Plan as of March 31, 2022) in the form of stock options and other stock-based awards.

July 15, 2022, the Company’s stockholders approved the 2022 Equity Plan under which the Company may issue up to 16,000,000 shares of common stock (less one share for every share granted under the 2016 Equity Plan since June 30, 2022 and inclusive of shares available under the 2016 Equity Plan as of June 30, 2022) in the form of stock options and other stock-based awards.

The Company grants equity awards to employees and directors, which include restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”) and stock options.

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percentile, then 0 % of the target number of PRSUs granted will vest;

• If the relative TSR is at the 25th percentile, then 50 % of the target number of PRSUs granted will vest;

• If the relative TSR is above the 25th percentile, then linear scaling is applied such that the percent of the target number of PRSUs vesting is 100 % at the 50th percentile and capped at 200 % of the target number of PRSUs granted for performance at the 85th percentile (or 100th percentile for grants made in 2020);

If the relative TSR is at the 25 th

percentile, then 50 % of the target number of PRSUs granted will vest;

If the relative TSR is above the 25 th

percentile, then linear scaling is applied such that the percent of the target number of PRSUs vesting is 100 % at the 50 th

percentile and capped at 200 % of the target number of PRSUs granted for performance at the 85 th

If the Company’s TSR is negative, the target number of PRSUs vesting is capped at 100 % regardless of the relative TSR percentile.

Stock-based compensation expense during the three months ended March 31, 2023 and 2022 was $ 4,536 and $ 2,936 , respectively.

based compensation expense was $

8,506 , respectively during the three and six months ended June 30, 2023 and $

5,368 , respectively, during the comparable periods in 2022.

A summary of unrecognized stock-based compensation expense and average remaining vesting period is as follows:

March 31, 2023

June 30, 2023

Unrecognized Stock-

Weighted-Average

Vesting Period (Years)

Vesting Period

Employees and directors

A summary of stock-based compensation award activity (shares) during the three months ended March 31, 2023 is as follows:

Balance at January 1, 2023

Balance at March 31, 2023

Represents the target number of PRSUs granted and outstanding.

The number of PRSUs that ultimately vest ranges from 0 % to 200 % of this amount.

A Monte-Carlo simulation was used to value these awards using the following assumptions for the Company and the peer group:

(i) beginning 90-day

average stock prices;

(ii) valuation date stock prices;

(iii) historical stock price volatilities ranging from 37 % to 56 % (average 47 %);

(iv) correlation coefficients based upon the price data used to calculate the historical volatilities;

(v) a risk free interest rate of 3.8 %;

and (vi) an expected dividend yield of 0 %.

The payout on PRSUs vesting in January 2023 was 77 %.

The remainder of the awards were forfeited.

A summary of stock-based compensation award activity (shares) during the three months ended June 30, 2023 is as follows:

Balance at April 1, 2023

Balance at June 30, 2023

Stockholder Rights Plan

On March 17, 2023, the Board of Directors of the Company adopted a stockholder rights plan, as set forth in the Stockholder Rights Agreement, dated March 17, 2023, between the Company and Continental Stock Transfer & Trust Company, as Rights Agent (the “Stockholder Rights Agreement”).

Pursuant to the terms of the Stockholder Rights Agreement, the Board of Directors declared a dividend distribution of (i) one Right (as defined below) for each outstanding share of common stock, par value $ 0.01 per share, of the Company’s common stock and (ii) 1,000 Rights for each outstanding share of Series A Preferred Stock”, to stockholders of record as of the close of business on March 28, 2023 (the “Record Date”).

1 thereto, dated May 4, 2023 (“Amendment No.

1”), and by Amendment No.

2 thereto, dated May 10, 2023 (“Amendment No.

2”) (as amended, the “Stockholder Rights Agreement”).

At the Company’s 2023 Annual Meeting of Stockholders held on June 16, 2023, the Company’s stockholders ratified the adoption by the Board of Directors of the Stockholder Rights Agreement.

the terms of the Stockholder Rights Agreement, the Board of Directors declared a dividend distribution of (i) one Right (as defined below) for each outstanding share of common stock, par value $ 0.01 per share, of the Company’s common stock and (ii) 1,000 Rights for each outstanding share of Series A Preferred Stock, to stockholders of record as of the close of business on March 28, 2023 (the “Record Date”).

In addition, one Right will automatically attach to each share of common stock and 1,000 Rights will automatically attach to each share of Series A Preferred Stock, in each case, issued between the Record Date and the earlier of the Distribution Date (as defined below) and the expiration date of the Rights.

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of a share (a “Unit”) of Series B Junior Participating Cumulative Preferred Stock, par value $ 0.01 per share, of the Company (the “Series B Preferred Stock”) at a cash exercise price of $ 32.00 per Unit (the “Exercise Price”), subject to adjustment, under certain conditions specified in the Stockholder Rights Agreement and summarized below.

Initially, the Rights are not exercisable and are attached to and trade with all shares of common stock and Series A Preferred Stock outstanding as of, and issued subsequent to, the Record Date.

he Rights are not exercisable and are attached to and trade with all shares of common stock and Series A Preferred Stock outstanding as of, and issued subsequent to, the Record Date.

The Rights will separate from the common stock and Series A Preferred Stock and will become exercisable upon the earlier of (i) the close of business on the tenth calendar day following the first public announcement that a person or group of affiliated or associated persons (an “Acquiring Person”) has acquired beneficial ownership of 10 % (or 20 % in the case of a person or group which, together with all affiliates and associates of such person or group, is the beneficial owner of shares of common stock of the Company representing less than 20 % of the shares of common stock of the Company then outstanding, and which is entitled to file, and files, a statement on Schedule 13G pursuant to Rule 13d-1(b)

or Rule 13d-1(c)

of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended, as in effect at the time of the first public announcement of the declaration of the Rights dividend with respect to the shares of common stock beneficially owned by such person or group) or more of the outstanding shares of common stock, other than as a result of repurchases of stock by the Company or certain inadvertent actions by a stockholder (the date of such announcement being referred to as the “Stock Acquisition Date”), or (ii) the close of business on the tenth business day (or such later day as the Board of Directors may determine) following the commencement of a tender offer or exchange offer that could result upon its consummation in a person or group becoming an Acquiring Person (the earlier of such dates being herein referred to as the “Distribution Date”).

of the General Rules and Regulations under the Exchange Act as in effect at the time of the first public announcement of the declaration of the Rights dividend with respect to the shares of common stock beneficially owned by such person or group) or more of the outstanding shares of common stock, other than as a result of repurchases of stock by the Company or certain inadvertent actions by a stockholder (the date of such announcement being referred to as the “Stock Acquisition Date”), or (ii) the close of business on the tenth business day (or such later day as the Board of Directors may determine) following the commencement of a tender offer or exchange offer that could result upon its consummation in a person or group becoming an Acquiring Person (the earlier of such dates being herein referred to as the “Distribution Date”).

A person or group who beneficially owned 10 % or more (or 20 % or more in the case of passive stockholders) of the Company’s outstanding common stock prior to the first public announcement by the Company of the adoption of the Stockholder Rights Agreement will not trigger the Stockholder Rights Agreement so long as they do not acquire beneficial ownership of any additional shares of common stock at a time when they still beneficially own 10 % or more (or 20 % or more in the case of passive stockholders) of such common stock, subject to certain exceptions as set forth in the Stockholder Rights Agreement.

For purposes of the Stockholder Rights Agreement, beneficial ownership is defined to include ownership of securities that are subject to a derivative transaction and acquired derivative securities.

of the Stockholder Rights Agreement, beneficial ownership is defined to include ownership of securities that are subject to a derivative transaction and acquired derivative securities.

Swaps dealers unassociated with any control intent or intent to evade the purposes of the Stockholder Rights Agreement are excepted from such imputed beneficial ownership.

In the event that a Stock Acquisition Date occurs, proper provision will be made so that each holder of a Right (other than an Acquiring Person or its associates or affiliates, whose Rights shall become null and void) will thereafter have the right to receive upon exercise, in lieu of a number of shares of Series B

Preferred Stock, that number of shares of common stock of the Company (or, in certain circumstances, including if there are insufficient shares of common stock to permit the exercise in full of the Rights, Units of Series B

Preferred Stock, other securities, cash or property, or any combination of the foregoing) having a market value of two times the Exercise Price of the Right (such right being referred to as the “Subscription Right”).

Pursuant to Amendment No.

1, beneficial ownership did not include the right to vote pursuant to any agreement, arrangement or understanding

with respect to voting on the proposal to approve and ratify the

Stockholder Rights Agreement presented to the Company’s stockholders at the Company’s 2023 annual meeting of stockholders.

Pursuant to Amendment No.

2, the parties to the SPA Agreement are not deemed to be “Acquiring Persons” solely by virtue of, or as a result of, the parties’ entry into the SPA Agreement, the issuance of the Series C Preferred Stock to GBH, and the performance or consummation of any of the other transactions contemplated by the SPA Agreement, among other conditions, under the terms and conditions set forth in Amendment No.

t that a Stock Acquisition Date occurs, proper provision will be made so that each holder of a Right (other than an Acquiring Person or its associates or affiliates, whose Rights shall become null and void) will thereafter have the right to receive upon exercise, in lieu of a number of shares of Series B Preferred Stock, that number of shares of common stock of the Company (or, in certain circumstances, including if there are insufficient shares of common stock to permit the exercise in full of the Rights, Units of Series B Preferred Stock, other securities, cash or property, or any combination of the foregoing) having a market value of two times the Exercise Price of the Right (such right being referred to as the “Subscription Right”).

In the event that, at any time following the Stock Acquisition Date, (i) the Company consolidates with, or merges with and into, any other person, and the Company is not the continuing or surviving corporation, (ii) any person consolidates with the Company, or merges with and into the Company and the Company is the continuing or surviving corporation of such merger and, in connection with such merger, all or part of the shares of common stock are changed into or exchanged for stock or other securities of any other person or cash or any other property, or (iii) 50 % or more of the Company’s assets or earning power is sold, mortgaged or otherwise transferred, each holder of a Right (other than an Acquiring Person or its associates or affiliates, whose Rights shall become null and void) will thereafter have the right to receive, upon exercise, common stock of the acquiring company having a market value equal to two times the Exercise Price of the Right (such right being referred to as the “Merger Right”).

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Rights that are or were beneficially owned by an Acquiring Person may (under certain circumstances specified in the Stockholder Rights Agreement) become null and void.

The Rights may be redeemed in whole, but not in part, at a price of $ 0.01 per Right (payable in cash, common stock or other consideration deemed appropriate by the Board of Directors) by the Board of Directors only until the earlier of (i) the time at which any person becomes an Acquiring Person or (ii) the expiration date of the Stockholder Rights Agreement.

hts may be redeemed in whole, but not in part, at a price of $ 0.01 per Right (payable in cash, common stock or other consideration deemed appropriate by the Board of Directors) by the Board of Directors only until the earlier of (i) the time at which any person becomes an Acquiring Person or (ii) the expiration date of the Stockholder Rights Agreement.

Immediately upon the action of the Board of Directors ordering redemption of the Rights, the Rights will terminate and thereafter the only right of the holders of Rights will be to receive the redemption price.

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While the distribution of the Rights will not be taxable to stockholders or to the Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for shares of common stock, other securities of the Company, other consideration or for common stock of an acquiring company.

The Rights are not exercisable until the Distribution Date and will expire at the close of business on March 16, 2024;

provided that if the Company’s stockholders have not ratified the Stockholder Rights Agreement by the close of business on the first day after the Company’s 2023 annual meeting of stockholders (including any adjournments or postponements thereof), the Rights will expire at such time, in each case, unless previously redeemed or exchanged by the Company.

The Rights are not exercisable until the Distribution Date and will expire at the close of business on March 16, 2024, unless previously redeemed or exchanged by the Company.

The Stockholder Rights Agreement provides the holders of the common stock with the ability to exempt an offer to acquire, or engage in another business combination transaction involving, the Company that is deemed a “Qualifying Offer” (as defined in the Stockholder Rights Agreement) from the terms of the Stockholder Rights Agreement.

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The Stockholder Rights Agreement provides additional characteristics necessary for an acquisition offer to be deemed a “Qualifying Offer,” including if the consideration offered in a proposed transaction is stock of the acquiror.

Pursuant to the Stockholder Rights Agreement, if the Company receives a Qualifying Offer and the Board of Directors

has not redeemed the outstanding Rights or exempted such Qualifying Offer from the terms of the Stockholder Rights Agreement or called a special meeting of stockholders (the “Special Meeting”) for the purpose of voting on whether to exempt such Qualifying Offer from the terms of the Stockholder Rights Agreement, in each case by the end of the 90 business day period following the commencement of such Qualifying Offer, provided such offer remains a Qualifying Offer during such period, the holders of 10% of the common stock may request that the Board call a Special Meeting to vote on a resolution authorizing the exemption of the Qualifying Offer from the terms of the Stockholder Rights Agreement.

If such a Special Meeting is not held by the 90th business day following the receipt of such a request from stockholders to call a Special Meeting, the Qualifying Offer will be deemed exempt from the terms of the Stockholder Rights Agreement on the 10th business day thereafter.

Pursuant to the Stockholder Rights Agreement, if the Company receives a Qualifying Offer and the Board of Directors has not redeemed the outstanding Rights or exempted such Qualifying Offer from the terms of the Stockholder Rights Agreement or called a special meeting of stockholders (the “Special Meeting”) for the purpose of voting on whether to exempt such Qualifying Offer from the terms of the Stockholder Rights Agreement, in each case by the end of the 90 business day period following the commencement of such Qualifying Offer, provided such offer remains a Qualifying Offer during such period, the holders of 10% of the common stock may request that the Board call a Special Meeting to vote on a resolution authorizing the exemption of the Qualifying Offer from the terms of the Stockholder Rights Agreement.

If such a Special Meeting is not held by the 90 th

business day following the receipt of such a request from stockholders to call a Special Meeting, the Qualifying Offer will be deemed exempt from the terms of the Stockholder Rights Agreement on the 10 th

business day thereafter.

Earnings/(Loss) Per Share

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Three Months Ended

Basic Earnings/(Loss) per Share

Six Months Ended

Basic Earnings per Share

Net income/(loss)

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Three Months Ended

Diluted Earnings/(Loss) per Share

Net earnings/(loss) available to common stockholders

Six Months Ended

Diluted Earnings per Share

Net income/(loss) available to common stockholders

Undistributed income allocable to participating securities

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Diluted earnings/(loss) per share

Diluted earnings/(loss) per share presented above is calculated using the two-class

ed earnings/(loss) per share presented above is calculated using the

method as this method results in the lowest diluted earnings per share amount for common stock.

During the three months ended March 31, 2022, there were no dilutive common stock equivalents as the Company reported a net loss for the period.

Total antidilutive non-participating

common stock equivalents were 695 and 509 for the three months ended March 31, 2023 and 2022, respectively.

There were no potential common shares associated with the conversion options embedded in the Convertible Notes included in weighted average diluted shares for the three months ended March 31, 2023 and 2022 as the Company’s average stock price was lower than the conversion price.

The following table reconciles weighted average diluted shares as reported on the Company’s Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022, which are determined pursuant to the treasury stock method, to the weighted average diluted shares used to calculate diluted earnings/(loss) per share as disclosed in the table above:

During the six months ended June 30, 2022, there were no dilutive common stock equivalents as the Company reported a net loss for the period.

Total antidilutive

non-participating

common stock equivalents were

208 , respectively, during the three and six months ended June 30, 2023, and

300 , respectively, during the comparable periods in 2022 (shares herein are reported in thousands).

were 855 and 430 potential common shares associated with the conversion options embedded in the 2020 Notes included in weighted average diluted shares for the three and six months ended June 30, 2023.

There were no such potential common shares for the comparable periods in 2022 as the Company’s average stock price was lower than the conversion price.

The following table reconciles weighted average diluted shares as reported on the Company’s Consolidated Statements of Operations for the three and six months ended June 30, 2023 and 2022, which are determined pursuant to the treasury stock method, to the weighted average diluted shares used to calculate diluted earnings/(loss) per share as disclosed in the table above:

Three Months Ended

Six Months Ended

Reconciliation of Weighted Average Diluted Shares (in thousands)

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Weighted average shares of common stock issuable upon conversion of the Series A Preferred Stock (Note 11)

Weighted average shares of common stock issuable upon conversion of the Series C Preferred Stock (Note 11)

Potentially dilutive restricted stock awards

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Excludes 15,486 participating securities and 356 potentially dilutive non-participating

common stock equivalents for the three months ended March 31, 2022, as the Company reported a net loss for the period (shares herein are reported in thousands).

Effective Income Tax Rate – Three Months Ended March 31, 2023 and March 31, 2022

The Company’s effective income tax rate during the three months ended March 31, 2023 was 7.9 % resulting in income tax expense of $ 1,383 .

common stock equivalents for the six months ended June 30, 2022 as the Company reported a net loss for the period (shares herein are reported in thousands).

Effective Income Tax Rate – Three and Six Months Ended June 30, 2 023

he Company’s effective income tax rate during the three months ended June 30, 2023 was 6.1 %, resulting in income tax expense of $ 3,555 .

The effective income tax rate differs from the federal statutory tax rate of 21 % primarily due to a non-taxable

gain on revaluation of deferred consideration and a $ 1,353 reduction in unrecognized tax benefits (including interest and penalties).

gain on revaluation/termination of deferred consideration—gold payments and a decrease in the deferred tax asset valuation allowance on losses recognized on the Company’s investments.

These items were partly offset by non-deductible

executive compensation.

any’s effective income tax rate during the six months ended June 30, 2023 of 6.5 %, resulting in income tax expense of $ 4,938 .

The effective income tax rate differs from the federal statutory tax rate of 21 % primarily due to a non-taxable

gain on revaluation/termination of deferred consideration—gold payments, a $ 1,353 reduction in unrecognized tax benefits (including interest and penalties) and a lower tax rate on foreign earnings.

These items were partly offset by a non-deductible

loss on extinguishment of our convertible notes and an increase in the deferred tax asset valuation allowance on losses recognized on the Company’s investments.

The Company’s effective income tax rate during the three months ended March 31, 2022 of 62.0 % resulted in an income tax benefit of $ 16,713 .

The effective income tax rate differs from the federal statutory tax rate of 21 % primarily due to a $ 19,897 reduction in unrecognized tax benefits (including interest and penalties), a lower tax rate on foreign earnings and tax windfalls associated with the vesting of stock-based compensation awards.

loss on extinguishment of our convertible notes, non-deductible

executive compensation and an increase in the deferred tax asset valuation allowance on losses recognized on our investments.

Effective Income Tax Rate – Three and Six Months Ended June 30, 2022

e Company’s effective income tax rate during the three months ended June 30, 2022 of 25.0 % resulted in income tax expense of $ 2,673 .

The effective income tax rate differs from the federal statutory tax rate of 21 % primarily due a valuation allowance on losses recognized on securities owned and non-deductible

executive compensation.

These items were partly offset by a non-taxable

loss on revaluation of deferred consideration and an increase in the deferred tax asset valuation allowance on losses recognized on securities owned.

gain on revaluation of deferred consideration—gold payments and a lower tax rate on foreign earnings.

y’s effective income tax rate benefit during the six months ended June 30, 2022 of 86.2 % resulted in an income tax benefit of $ 14,040 .

The Company’s effective income tax rate differs from the federal statutory tax rate of 21 % primarily due to a $ 19,897 reduction in unrecognized tax benefits (including interest and penalties) and a lower tax rate on foreign earnings.

These items were partly offset by a non-taxable

loss on revaluation of deferred consideration—gold payments and an increase in the deferred tax asset valuation allowance on losses recognized on financial instruments owned.

Deferred Tax Assets

A summary of the components of the Company’s deferred tax assets at March 31, 2023 and December 31, 2022 is as follows:

A summary of the components of the Company’s deferred tax assets at June 30, 2023 and December 31, 2022 is as follows:

Deferred tax assets:

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Accrued expenses

Goodwill and intangible assets

Stock-based compensation

Interest carryforwards

Goodwill and intangible assets

Operating lease liabilities

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Deferred tax assets, net

Net Operating and Capital Losses—U.S.

The Company’s tax effected net operating losses (“NOLs”) at March 31, 2023 were $ 127 , which expire in 2024 .

The net operating loss carryforwards have been reduced by the impact of annual limitations described in the Internal Revenue Code Section 382 that arose as a result of an ownership change.

The Company’s tax effected capital losses at March 31, 2023 were $ 17,740 .

Capital Losses – U.S.

The Company’s tax effected capital losses at June 30, 2023 were $

These capital losses expire between the years 2023 and 2028.

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One of the Company’s European subsidiaries generated NOLs outside the U.S.

These tax effected NOLs, all of which are carried forward indefinitely, were $ 1,625 at March 31, 2023.

These tax effected NOLs, all of which are carried forward indefinitely, were $

1,583 at June 30, 2023.

Valuation Allowance

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that these deferred tax assets will not be realized.

Uncertain Tax Positions

Tax positions are evaluated utilizing a two-step

The Company first determines whether any of its tax positions are more-likely-than-not

to be sustained upon examination, based solely on the technical merits of the position.

Once it is determined that a position meets this recognition threshold, the position is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement.

In connection with the ETFS Acquisition, the Company accrued a liability for uncertain tax positions and interest and penalties at the acquisition date.

The Company also recorded an offsetting indemnification asset provided by ETFS Capital as part of its agreement to indemnify the Company for any potential claims.

The table below sets forth the aggregate changes in the balance of these gross unrecognized tax benefits:

Balance at January 1, 2023

Decrease—Lapse of statute of limitations

Balance at March 31, 2023

The gross unrecognized tax benefits were accrued in British pounds.

Income Tax Examinations

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federal income tax as well as income tax of multiple state, local and certain foreign jurisdictions.

As of March 31, 2023, with few exceptions, the Company was no longer subject to income tax examinations by any taxing authority for the years before 2018.

As of June 30, 2023, with few exceptions, the Company was no longer subject to income tax examinations by any taxing authority for the years before 2018.

Undistributed Earnings of Foreign Subsidiaries

Income Taxes provides guidance that US companies do not need to recognize tax effects on foreign earnings that are indefinitely reinvested.

The Company repatriates earnings of its foreign subsidiaries and therefore has recognized a deferred tax liability of $ 246 and $ 205 at March 31, 2023 and December 31, 2022, respectively.

Income Taxes provides guidance that U.S.

companies do not need to recognize tax effects on foreign earnings that are indefinitely reinvested.

The Company repatriates earnings of its foreign subsidiaries and therefore has recognized a deferred tax liability of $ 210 and $ 205 at June 30, 2023 and December 31, 2022, respectively.

Shares Repurchased

On February 22, 2022, the Company’s Board of Directors approved an increase of $ 85,709 to the Company’s share repurchase program to $ 100,000 and extended the term for three years through April 27, 2025 .

ary 22, 2022, the Company’s Board of Directors approved an increase of $ 85,709 to the Company’s share repurchase program to $ 100,000 and extended the term for three years through April 27, 2025 .

Included under the Company’s share repurchase program are purchases to offset future equity grants made under the Company’s equity plans and purchases made in open market or privately negotiated transactions.

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Shares repurchased under this program are returned to the status of authorized and unissued on the Company’s books and records.

During the three months ended March 31, 2023 and 2022, the Company repurchased 604,505 and 588,694 shares of its common stock, respectively, under this program for an aggregate cost of $ 3,384 and $ 3,394 , respectively.

ompany repurchased 26,582 and 631,087 shares of its common stock under this program during the three and six months ended June 30, 2023, and 588,694 during the comparable periods in 2022.

The aggregate cost of the shares repurchased during the three and six months ended June 30, 2023 was $ 156 and $ 3,540 , respectively, and the aggregate cost of the shares repurchased during the comparable periods in 2022 was $ 3,394 .

Shares repurchased under this program were returned to the status of authorized and unissued on the Company’s books and records.

As of March 31, 2023, $ 96,591,597 remained under this program for future purchases.

June 30, 2023, $ 96,436 remained under this program for future purchases.

Goodwill and Intangible Assets

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Balance at January 1, 2023

Balance at March 31, 2023

Goodwill arising from the ETFS Acquisition of $ 84,057 is not deductible for tax purposes as the acquisition was structured as a stock acquisition occurring in the U.K.

Balance at June 30, 2023

On April 11, 2023, the Company acquired 100 % of the equity interests of Securrency Transfers, Inc.

(renamed WisdomTree Transfers, Inc.) for an aggregate purchase price of $ 985 (net of cash acquired).

The acquisition has been accounted for under the acquisition method of accounting in accordance with ASC Topic 805, Business Combinations, and resulted in all consideration being allocated to goodwill.

the total goodwill of $ 86,841 at June 30, 2023, $ 85,042 is not deductible for tax purposes as the acquisitions that gave rise to the goodwill were structured as stock acquisitions.

The remainder of the goodwill is deductible for U.S.

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The table below sets forth the Company’s intangible assets which are tested annually for impairment on November 30 th

Balance at March 31, 2023

Balance at June 30, 2023

ETFS acquisition

Software development

Balance at March 31, 2023

Balance at June 30, 2023

Balance at December 31, 2022

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ETFS Acquisition (Indefinite-Lived)

In connection with the ETFS Acquisition, which was completed on April 11, 2018 , the Company identified intangible assets valued at $ 601,247 related to the right to manage AUM through customary advisory agreements.

In connection with the ETFS Acquisition, which was completed on

April 11, 2018 , the Company identified intangible assets valued at $

601,247 related to the right to manage AUM through customary advisory agreements.

These intangible assets were determined to have indefinite useful lives and are not deductible for tax purposes.

Software Development (Finite-Lived)

Internally-developed software is amortized over a useful life of three years .

During the three-month period ended March 31, 2023, the Company recognized amortization expense on internally-developed software of $ 51 .

As of March 31, 2023, expected amortization expense for the unamortized finite-lived intangible assets for the next five years and thereafter is as follows:

Remained of 2023

Internally-developed software is amortized over a useful life of

three years .

During the three and six months ended June 30, 2023, the Company recognized amortization expense on internally-developed software of $

156 , respectively.

As of June 30, 2023, expected amortization expense for the unamortized finite-lived intangible assets for the next five years and thereafter is as follows:

Remainder of 2023

2028 and thereafter

Total expected amortization expense

The weighted-average remaining useful life of the finite-lived intangible assets is 2.9 years.

e weighted-average remaining useful life of the finite-lived intangible assets is 2.9 years.

Contingent Payments

Sale of Canadian ETF Business

On February 19, 2020, the Company completed the sale of all the outstanding shares of WisdomTree Asset Management Canada, Inc.

n February 19, 2020, the Company completed the sale of all the outstanding shares of WisdomTree Asset Management Canada, Inc.

to CI Financial Corp.

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anniversaries of the closing date, respectively.

A gain of $ 1,477 was recognized during the three months ended March 31, 2023, from remeasuring the contingent payment to its realizable value.

These gains were recorded in other losses, net.

ain of $ 0 and $ 1,477 was recognized during the three and six months ended June 30, 2023, respectively, from remeasuring the contingent payment to its realizable value.

This gain was recorded in other gains and losses, net.

Subsequent Events

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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