Quarterly Report for Quarter Ending December 31, 2025 (Form 10-Q)

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

This Quarterly Report on Form 10-Q (Quarterly Report) includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding the future financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. The words "may," "will," "intend," "plan," "believe," "anticipate," "expect," "estimate," "predict," "potential," "continue," "likely," or "opportunity," the negative of these words or similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including, without limitation, those described in Risk Factors in our 2025 Annual Report on Form 10-K (2025 Annual Report), as filed with the Securities and Exchange Commission (SEC) on September 26, 2025.

Unless the context requires otherwise, references in this Quarterly Report to "Lite Strategy," "LITS," "we," "us" and "our" refer to Lite Strategy, Inc.

Overview

Lite Strategy, Inc. (Nasdaq: LITS) is a pharmaceutical company that has historically developed novel and differentiated cancer therapies and is currently assessing pre-clinical development programs in potentially nononcology disease indications. We also hold Litecoin (LTC) tokens as a primary reserve asset as part of our broader institutional treasury initiative. We initially built our pipeline by acquiring promising cancer agents and creating value in programs through clinical development, strategic partnerships, and out-licensing or commercialization, as appropriate. Our approach to drug development is to evaluate our drug candidates either as stand-alone or in combination with standard-of-care therapies to overcome known resistance mechanisms and address medical needs to provide improved patient benefit. Our drug candidate pipeline includes voruciclib, an oral cyclin-dependent kinase 9 (CDK9) inhibitor, zandelisib, an oral, once-daily, selective P3K3 inhibitor and, prior to its sale in October 2024 to Aardvark Therapeutics, Inc., ME-344, an intravenous small molecule mitochondrial inhibitor targeting the oxidative phosphorylation pathway in the mitochondria.

Stock Buy Back

In connection with shifting our Litecoin Treasury Strategy (as defined below) from initial LTC accumulation to active capital market operations, on October 29, 2025, we announced that our Board of Directors (Board) authorized a program to repurchase shares of our common stock, par value $0.00000002 per share (the Common Stock), up to an aggregate amount of $25.0 million, excluding fees, commissions and excise tax due under the Inflation Reduction Act of 2022 (the Share Repurchase Program). The Share Repurchase Program was effective immediately and provides for shares to be repurchased in the open market, privately negotiated transactions or otherwise. The timing of purchases and the exact number of shares to be purchased under the Share Repurchase Program will depend on market conditions, does not include specific price targets or timetables and may be suspended or terminated by us at any time. We intend to finance the purchases using proceeds from our Covered Call Options (as defined below) or from the liquidation of a portion of our LTC tokens.

In December 2025, we commenced utilization of our Share Repurchase Program and have repurchased an aggregate of 137,541 shares of our Common Stock from the open market (Treasury Shares) at a weighted-average price of $1.47 per share as of December 31, 2025. Treasury Shares repurchased through the Share Repurchase Program are considered held in treasury and returned to the status of authorized but unissued shares of Common Stock. The Share Repurchase Program does not have an expiration date, does not include specific price targets or timetables and may be suspended or terminated by us at any time.

Litecoin Treasury Strategy

On August 5, 2025, we announced the commencement of our primary reserve asset and implementation strategy built on a digital asset infrastructure and long-term capital innovation (the Litecoin Treasury Strategy) through our acquisition of LTC tokens, reflecting the full deployment of the net proceeds of the PIPE (as defined below). LTC is an open source, global payment network that is fully decentralized without any central authorities. Mathematics secures the network and empowers individuals to control their own finances. LTC features faster transaction confirmation times and improved storage efficiency than the leading math-based currency. We believe this strategy will allow us to diversify reserves, enhance capital efficiency and align with emerging financial technologies.

We enter into contracts with GSR Markets Ltd (GSR Markets), an affiliate of GSR Strategies LLC (GSR or Asset Manager), in which we write covered call options on certain of our LTC holdings (Covered Call Options). We utilize these Covered Call Options on certain digital asset holdings as part of broader digital asset treasury management strategy. These strategies are designed to generate incremental liquidity and income while retaining exposure to the underlying digital assets, subject to the risk that the assets may be delivered to option counterparties if exercised.

We are exposed to market risk related to changes in the fair value of derivative liabilities associated with our Covered Call Options, as well as counterparty credit risk related to our digital assets receivable, net. We monitor these risks on an ongoing basis and

evaluate expected credit losses each reporting period. As of December 31, 2025, we concluded expected credit losses were immaterial due to the short duration of the receivables, the over-collateralized nature of the arrangements, and the credit profile and risk management practices of the transfer agent.

Changes in fair value of our Covered Call Options and/or realized gains on Covered Call Options which expire unexercised are recognized upon settlement (expiration) of the related Covered Call Option contract within gain on derivative liabilities, a component of other (expense) income, net, in the condensed consolidated statements of operations.

Private Investment in Public Equity (PIPE) and Related Agreements

On July 22, 2025 (the Closing Date), we closed on a $100.0 million PIPE and issued an aggregate of (i) 23,216,898 shares (the Shares) of our Common Stock, at an offering price of $3.42 per share and (ii) pre-funded warrants (the Pre-Funded Warrants, and together with the Shares, the Securities), to purchase up to an aggregate of 6,022,869 shares of Common Stock, at an offering price of $3.4199 per Pre-Funded Warrant (the Offering).

Also in July 2025, we entered into various agreements with certain advisors to the PIPE, asset managers and custodians who will help us deploy our Litecoin Treasury Strategy, including but not limited to (i) a placement agency agreement, (ii) an asset management agreement, (iii) an advisory agreement, (iv) a strategic advisor agreement and (v) a new at-the-market sales agreement (the Sales Agreement). As partial or full consideration of services provided associated with the PIPE, we issued warrants for the purchase of up to 3,070,177 shares of Common Stock with a weighted-average exercise price of approximately $4.10 per share. See Note 12. Warrantsfor a summary of the fair value assumptions used to value the Advisory Warrants upon the closing of the PIPE.

Strategic Alternatives

On July 22, 2024, we announced that our Board unanimously determined to begin the evaluation of our strategic alternatives, including potential transactions as well as an orderly wind down of operations, if appropriate, to maximize the value of our assets for our stockholders. We commenced a reduction-in-force (the Strategic Alternatives RIF) beginning August 1, 2024, which continued in stages as our operational and strategic direction evolved. In connection with this evaluation, we discontinued the clinical development of voruciclib in oncology, while we continued to conduct certain nonclinical activities related to our drug candidate assets. As part of the review of strategic alternatives, we considered options such as out-licensing opportunities or sale of our existing programs and merger and acquisition opportunities, as well as other potential opportunities.

The evaluation of strategic alternatives concluded with the August 2025 commencement of our Litecoin Treasury Strategy through our acquisition of LTC tokens, reflecting the full deployment of the net proceeds of the PIPE. LTC is an open source, global payment network that is fully decentralized without any central authorities. Mathematics secures the network and empowers individuals to control their own finances and features faster transaction confirmation times and improved storage efficiency than the leading math-based currency. We believe this strategy will allow us to diversify reserves, enhance capital efficiency and align with emerging financial technologies. We are committed to long-term innovation in capital structure and financial technology, along with the initiation of an expanding strategy that could include the commencement of LTC mining or other crypto-focused operational activities. Additionally, we have commenced further investigational research and development pre-clinical activities with our drug candidate pipeline in nononcology disease indications for potential out-licensing or sale related opportunities.

Risks and Uncertainties of Digital Assets

The fair value of our intangible digital assets, calculated by reference to the principal market price in accordance with U.S. GAAP, relates primarily to the value of the LTC tokens held by us and fluctuations in the price of LTC tokens could materially and adversely affect an investment in our stock. The price of LTC tokens has a limited history and during such history, LTC token prices have been volatile and subject to influence by many factors, including, but not limited to, the levels of liquidity, global LTC supply and demand, compliance and internal control failures leading to the theft of LTC from global trading platforms or vaults, limited liquidity and trading volumes compared to sovereign currency markets and competition from other forms of digital currency or payment services, and global or regional political, economic or financial conditions. If digital asset markets continue to experience significant price fluctuations, we may experience losses.

LTC is subject to a developing regulatory landscape. The SEC has stated that certain digital assets may be considered "securities" under the federal securities laws but has been inconsistent in its nonbinding statements and informal assurances via no action letters. The test for determining whether a particular digital asset is a "security" is complex and difficult to apply, and the outcome is difficult to predict.

If LTC is determined to be a "security" under federal or state securities laws by the SEC or any other agency, or in a proceeding in a court of law or otherwise, it may have material adverse consequences for LTC. For example, it may become more difficult for LTC to be traded, cleared and custodied as compared to other digital assets that are not considered to be securities, which could, in turn, negatively affect the liquidity and general acceptance of LTC and cause users to migrate to other digital assets. As such, any determination that LTC is a security under federal or state securities laws may adversely affect the value of LTC and, as a result, an investment in us.

In addition, if LTC is in fact a security, we could be considered an unregistered "investment company" under the Investment Company Act of 1940, which could necessitate our liquidation or delisting from the exchange on which our stock is traded. In such case, we may be deemed to have participated in an illegal offering of investment company securities and there is no guarantee that the we will be able to register under the Investment Company Act of 1940 at such time, or take such other actions as may be necessary to ensure our activities comply with applicable law, which could force us to liquidate our LTC holdings.

As with any computer network, digital asset networks are vulnerable to various kinds of attacks and disruptions. As LTC operates on a decentralized network, it is highly resistant to hacking attacks. Although LTC may be less susceptible to attack than other cryptocurrencies, transfer of digital assets on blockchains are vulnerable to certain types of exploits.

Access to our LTC accounts requires private keys to initiate transactions and three separate keys for approval. If any single approval key was lost, destroyed or otherwise compromised, we may be unable to access our LTC holdings until such approval key was replaced. The processes by which LTC transactions are settled are dependent on the LTC peer-to-peer network, and as such, we are subject to operational risk. A risk also exists with respect to previously unknown technical vulnerabilities, which may adversely affect the value of LTC.

Drug Candidate Development Programs

Our drug candidate pipeline includes voruciclib, an oral CDK9 inhibitor and zandelisib, an oral, once-daily, selective PI3Kδ inhibitor. In October 2024, we sold ME-344, a small molecule mitochondrial inhibitor targeting the oxidative phosphorylation pathway, to Aardvark Therapeutics, Inc. for development in obesity and metabolic diseases, with potential for future milestone payments and royalties due to us upon reaching prespecified development and commercialization targets.

Voruciclib: Orally Administered CDK9 Inhibitor

Voruciclib, a selective orally administered CDK9 inhibitor, was studied in a Phase 1 trial, which evaluated voruciclib dose and schedule as a single agent in patients with acute myeloid leukemia (AML) and B-cell malignancies, and in combination with the B-cell lymphoma 2 (BCL-2) inhibitor venetoclax (marketed as Venclexta®) in patients with AML. All voruciclib clinical trial activities were ceased in September 2024. Previously, voruciclib had been evaluated by Piramal Enterprises Limited in three clinical studies conducted in patients with solid tumors and we conducted pre-clinical studies to explore potential activity in various solid tumors including in combination with therapies that target the RAS signaling pathway, such as KRAS inhibitors. We are currently assessing a pre-clinical development program in nononcology disease indications and have commenced these activities in the second quarter of fiscal year 2026.

Voruciclib Scientific Overview: Cell Cycle Signaling

CDK9 has important functions in cell cycle regulation, including the modulation of two therapeutic targets applicable in cancer and autoimmune diseases:

Directly inhibiting MCL1 and MYC has historically been difficult, but CDK9 is a promising approach to indirectly target these genes.

Voruciclib: Inhibition of MCL1

CDK9 is a known transcriptional regulator of MCL1. Over expression of MCL1 is frequently observed in many tumor types and is closely associated with tumorigenesis, poor prognosis and drug resistance. In AML, MCL1 is upregulated in about half of patients with relapsed and refractory (R/R) diseaseand is associated with poor prognosis in these patients. Also important, high levels of MCL1 expression are associated with resistance to venetoclax.

Data from a Phase 1 study evaluating voruciclib as a single agent and in combination with venetoclax in patients with R/R AML have also demonstrated the anticipated decreases in Mcl-1 protein as reported by Davids et al (Blood Advances. 2025;9(4):820-832) and Alvarado-Valero et al (Blood Neoplasia. 2025;2(3):100108).

The research suggests that voruciclib is potentially an attractive therapeutic agent for treating cancers in combination with venetoclax or other BCL-2 inhibitors and could be potentially used in autoimmune diseases to modulate T-Cells and macrophages.

Voruciclib: Inhibition of MYC

Many cancers are associated with over expression of MYC, a transcription factor regulating cell proliferation and growth. CDK9 is a known regulator of MYC transcription and a modulator of MYC protein phosphorylation. Data reported at the American Association for Cancer Research Annual Meeting 2021 in pre-clinical models demonstrated that voruciclib:

The research presented suggests that voruciclib could be an attractive therapeutic agent for both hematological cancers, as well as solid tumors, dependent on the activity of MYC.

Terminated Clinical Programs

In a Phase 1 clinical trial, we evaluated the dose and schedule of voruciclib in combination with venetoclax, a BCL-2 inhibitor, in patients with R/R AML. The trial initially evaluated dose and schedule of voruciclib as a monotherapy in patients with relapsed and refractory B-cell malignancies and AML after failure of prior standard therapies. The primary objectives of the study were to determine the safety and biologic effective dose of voruciclib monotherapy or voruciclib in combination with venetoclax. Secondary objectives of the study included assessing the preliminary efficacy, pharmacokinetics, pharmacodynamics and biomarkers of voruciclib monotherapy or voruciclib in combination with venetoclax.

As reported by Davids et al. in a 2025 Blood Advance paper, the voruciclib monotherapy dose escalation/expansion stage of the study enrolled a total of 40 patients; the first 16 were dosed daily continuously at 50 and 100 mg and the following 24 patients were dosed on an intermittent schedule (14 consecutive days on therapy in a 28-day cycle) at 100, 150 and 200 mg. Voruciclib at doses up to 200 mg administered on this intermittent schedule was well tolerated with no dose limiting toxicities (DLT) reported. The most common adverse events (≥20% of patients) were diarrhea, nausea, anemia and fatigue. The majority of adverse events were Grade 1-2; of note, the only Grade 3-4 adverse events were diarrhea (n=1) and anemia (n=5). Pharmacokinetics were dose proportional and a mean half-life of approximately 24 hours supports once daily dosing.

In the 21 patients with AML, one patient achieved a morphologic leukemia-free state and nine patients had disease stabilization, which lasted at least three months in two patients. In the 19 patients with B-cell malignancies, four patients had stable disease with a decrease in tumor size. Correlative studies assessing Mcl-1 and RNA Pol II phosphorylation on Ser2 (RNA Pol II p-S2) demonstrated reduction in expression consistent with the anticipated on-target pharmacodynamic effect of voruciclib.

The next stage of the study evaluated seven voruciclib dose levels from 50 mg every other day to 300 mg daily for 14 consecutive days in a 28-day cycle in combination with standard dose venetoclax in patients with R/R AML and was reported by Avarado-Valero et al. in a 2025 Blood Neoplasia paper. A total of 41 patients were enrolled. These patients were generally heavily pre-treated; the median number of prior therapies was 2 (range 1-7) and 18 (44%) patients had ≥3 prior therapies.

Ten of 32 (31%) patients administered voruciclib at doses ≥ 100 mg in combination with venetoclax 10 (31%) achieved disease control, including three objective responses.

Results from correlative blood biomarker assay studies demonstrated anticipated decreases of Mcl-1, including a greater decrease in Mcl-1 in responding patients. This supports our hypothesis that voruciclib, as an inhibitor or CDK9, regulates Mcl-1 and therefore may address the upregulation of MCL1 associated with venetoclax.

Voruciclib at doses up to 300 mg administered intermittently in combination with venetoclax was well tolerated with no DLT observed. The maximum tolerated dose of voruciclib administered on this schedule with venetoclax has not been established. The most common (≥5% of patients) grade 3 adverse events were myelosuppression associated with AML. Only 1 patient was observed as having a non-hematologic grade 3 drug-related adverse event (diarrhea).

Voruciclib was also previously evaluated in more than 70 patients with solid tumors in multiple Phase 1 studies. The totality of the clinical data, along with data from pre-clinical studies, suggests voruciclib's ability to inhibit its molecular target at a projected dose as low as 150 mg daily.

Zandelisib: PI3Kδ Inhibitor Overview

Zandelisib is an oral, once-daily, selective PI3Kδ inhibitor that we were jointly developing with Kyowa Kirin Co., Ltd (KKC) under a global license, development and commercialization agreement entered into in April 2020 (the KKC Commercialization Agreement) was later terminated in 2023 (as further discussed below). Currently, we are not conducting any clinical trial for zandelisib and are currently assessing potential out-licensing or sale related opportunities.

In March 2022, we and KKC reported the outcome of an end of Phase 2 meeting with the U.S. Food and Drug Administration (FDA) wherein the agency discouraged a filing based on data from a single-arm Phase 2 TIDAL trial because data generated from single arm studies are insufficient to adequately assess the risk/benefit of PI3Kδ inhibitors in indolent non-Hodgkin lymphoma.

In November 2022, we and KKC met with the FDA in a follow-up meeting to the March 2022 end of Phase 2 meeting. At this meeting, the FDA provided further guidance regarding the design and statistical analysis for the ongoing Phase 3 COASTAL trial. Following the November meeting, the companies jointly concluded a clinical trial consistent with the recent FDA guidance, including modification of the COASTAL trial, would likely not be feasible to complete within a time period that would support further investment or with sufficient certainty of the regulatory requirements for approval to justify continued global development efforts. As a result, we and KKC jointly decided to discontinue global development of zandelisib for indolent forms of non-Hodgkin lymphoma outside of Japan. The discontinuation of zandelisib development outside of Japan was a business decision based on the most recent regulatory guidance from the FDA and is not related to the zandelisib clinical data generated to date. Subsequently, in May 2023, KKC decided to discontinue development of zandelisib in Japan. The discontinuation of zandelisib in Japan was a business decision by KKC based on the most recent regulatory guidance from the Pharmaceuticals and Medical Devices Agency in Japan and was not related to the zandelisib clinical data that had been generated.

On July 14, 2023, we entered into a termination agreement with KKC to terminate all agreements between the parties and cease further zandelisib clinical development globally. Activities associated with the compassionate use supply and wind down of the KKC Commercialization Agreement were completed in fiscal year 2024.

Results of Operations

Comparison of Three Months Ended December 31, 2025 and 2024

The following table summarizes certain components of our results of operations (in thousands):

Research and Development.

The following is a summary of our research and development expenses to supplement the more detailed discussion below (in thousands).

Research and development costs decreased by approximately $0.3 million for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. This decrease was a result of our announcement in July 2024 to explore strategic alternatives, at which time all clinical studies were ceased and we initiated reductions in our workforce. Pre-clinical investigational activities in nononcology disease indications for voruciclib commenced in the second quarter of fiscal year 2026.

General and Administrative.

General and administrative expenses increased by $0.2 million to $3.3 million for the three months ended December 31, 2025 compared to $3.1 million for the three months ended December 31, 2024. For the three months ended December 31, 2025, we incurred $0.7 million in asset management and advisory fees and $0.4 in professional services incurred in connection with our Litecoin Treasury Strategy deployed in the first quarter of fiscal year 2026 along with a $0.3 million increase in noncash share-based compensation expense. This increase was partially offset by $1.2 million of lower personnel costs, which included $0.9 million in termination benefits.

Change in Fair Value of Digital Assets.

Change in fair value of digital assets represents unrealized losses from the remeasurement of our LTC investments to their fair value and realized losses recognized upon derecognition of LTC digital assets when placing them as collateral with GSR Markets upon writing of Covered Call Options. We had no such investments in the comparable prior year period.

Other (Expense) Income, Net.

Other (expense) income, net, decreased by $1.7 million to a loss of $0.9 million for the three months ended December 31, 2025 compared to income of $0.8 million for the three months ended December 31, 2024, primarily associated with the change in fair value of digital assets receivable, net, reflecting unrealized losses on LTC pledged for Covered Call Options partially offset by a gain on derivative liabilities during the current period with no such similar activity during the comparable prior year period. During the three months ended December 31, 2025 compared to the three months ended December 31, 2024, we received lower interest and dividend income as a result of lower cash balances. During the three months ended December 31, 2024, we recognized a gain on the sale of our ME-344 asset with no similar activity in the current three-month period.

Results of Operations

Comparison of Six Months Ended December 31, 2025 and 2024

The following table summarizes certain components of our results of operations (in thousands).

Research and Development.

The following is a summary of our research and development expenses to supplement the more detailed discussion below (in thousands).

Research and development costs decreased by $3.4 million for the six months ended December 31, 2025 compared to the six months ended December 31, 2024. This decrease was a result of our announcement in July 2024 to explore strategic alternatives, at which time all clinical studies were ceased and we initiated reductions in our workforce. Pre-clinical investigational activities in nononcology disease indications for voruciclib commenced in the second quarter of fiscal year 2026.

General and Administrative.

General and administrative expenses decreased by $1.9 million to $6.4 million for the six months ended December 31, 2025, compared to $8.3 million for the six months ended December 31, 2024. The decrease was primarily due to $3.6 million of lower

personnel costs, including $2.6 million in termination benefits and a $0.7 million decrease in corporate overhead costs. These decreases were partially offset by $1.2 million in asset management and advisory fees and $0.4 in professional services incurred in connection with our Litecoin Treasury Strategy deployed in the first quarter of fiscal year 2026 and a $0.6 million increase in noncash share-based compensation expense.

Change in Fair Value of Digital Assets.

Change in fair value of digital assets represents unrealized losses from the remeasurement of our LTC investments to their fair value and realized losses recognized upon derecognition of LTC digital assets when placing them as collateral with GSR Markets upon writing of Covered Call Options. We had no such investments in the comparable prior year period.

Other (Expense) Income, Net.

Other (expense) income, net, decreased by approximately $2.0 million to a loss of $0.8 million for the six months ended December 31, 2025 compared to income of $1.1 million for the six months ended December 31, 2024, primarily associated with the change in fair value of digital assets receivable, net, reflecting unrealized losses on LTC pledged for Covered Call Options partially offset by a gain on derivative liabilities during the current period with no such similar activity during the comparable prior year period. During the six months ended December 31, 2025, compared to the six months ended December 31, 2024, we received lower interest and dividend income as a result of lower cash balances. During the six months ended December 31, 2024, we recognized a gain on the sale of our ME-344 asset with no similar activity in the current six-month period.

Liquidity and Capital Resources

To date, we have obtained cash and funded our operations primarily through equity financings and license agreements. We have accumulated losses of $438.6 million since inception and expect to incur operating losses and generate negative cash flows from operations for the foreseeable future. As of December 31, 2025, we had $8.8 million in cash and cash equivalents and $64.0 million in unrestricted digital assets. Although we intend to retain and hold our digital assets, we could liquidate these assets, or a portion thereof, if needed to fund our operating activities. In connection with our July 2024 announcement regarding the evaluation of our strategic alternatives, we discontinued the clinical development of voruciclib in oncology, while certain related nonclinical research and development activities continued through the end of fiscal year 2025. As part of our continued assessment of future pre-clinical development with our drug candidate pipeline, in the second quarter of fiscal year 2026, we commenced additional investigational research and development activities in nononcology disease indications. We believe that our cash balance, including our digital assets, will be sufficient to meet our obligations and fund operations for at least the next 12 months from the issuance of these condensed consolidated financial statements.

In December 2025, we commenced utilization of our Share Repurchase Program utilizing proceeds from our Covered Call Options to repurchase Shares of our Common Stock. During the three months ended December 31, 2025, we realized gains of $0.5 million from our Covered Call Options, of which we used $0.2 million to repurchase 137,541 shares of our Common Stock.

Sources and Uses of Our Cash

Net cash used in operating activities for the six months ended December 31, 2025, of $6.4 million consisted of our net loss of $34.4 million and $1.8 million in changes in our operating assets and liabilities used in operations, partially offset by $29.8 million for noncash items. Net cash used in operating activities for the six months ended December 31, 2024 of $15.1 million consisted of our net loss of $10.7 million, $4.3 million in our operating assets and liabilities used in operations and $0.1 million in noncash items.

Net cash used in investing activities for the six months ended December 31, 2025, of $99.4 million consisted of our acquisition of digital assets upon deployment of our Litecoin Treasury Strategy in August 2025 and proceeds from written call options on our LTC. Net cash provided by financing activities for the six months ended December 31, 2024 of $35.2 million consisted of maturities of our short-term investments and proceeds recognized on the disposition of a nonfinancial asset.

Net cash provided by financing activities for the six months ended December 31, 2025, was $96.6 million associated with the issuance and sale of 23,216,898 shares of Common Stock and Pre-Funded Warrants for the purchase of up to 6,022,869 shares of Common Stock in our PIPE and the issuance, sale of 882,924 shares of Common Stock under our ATM Program. These proceeds were partially offset by cash used to repurchase 137,541 shares of our Common Stock at an average cost per share of $1.47. We had no financing activities during the six months ended December 31, 2024.

Capital Resource Requirements

As of December 31, 2025, we have the following potential purchase obligations for which the timing and/or likelihood of occurrence is unknown; however, if such claims arise in the future, they could have a material effect on our financial position, results of operations, and cash flows.

Our future capital requirements will depend on many factors, including:

Critical Accounting Estimates

We describe our significant accounting policies in Note 2. Summary of Significant Accounting Policies of the notes to the financial statements included in our 2025 Annual Report. We discuss our critical accounting estimates inItem 7. Management's Discussion and Analysis of Financial Condition and Results of Operationsin our 2025 Annual Report. Except as disclosed in Note 2. Summary of Significant Accounting Policies,as it relates to Digital Assets, Digital Assets Receivable, Net, Derivatives - Covered Call Options and Warrants, and the addition of our critical accounting estimate as it relates to Valuation of Equity Instruments Issued for Exchange for Services and Valuation of Covered Call Options (described below), there have been no changes in our significant accounting policies or critical accounting estimates since June 30, 2025.

Valuation of Equity Instruments Issued for Exchange for Services

Equity instruments issued in exchange for services rendered or to be rendered to us are accounted for in accordance with ASC 718, Stock Compensation. Such instruments are evaluated to determine if they should be classified as liability or equity awards. For these awards, we estimate the fair value of the services rendered/to be rendered (i.e., the compensation cost to be recognized) based upon either (i) the grant date fair value of the equity instruments issued as determined using an option pricing model such as the BSM Model or (ii) the fair value of the liabilities incurred/settled. For the Advisory Warrants issued in the PIPE, we estimated the grant date fair value using the valuation inputs as of the grant date. For the GSR Pre-Funded Warrant and the GD Advisory Warrant issued in settlement of the Asset-based Fee and the Annual Advisory Fee, respectively, we determined the grant date fair value represented the amount of the liabilities settled. We recognize the expense immediately in our condensed consolidated financial statements for services rendered at the time of issuance and for services not yet rendered, we recognize an asset and amortize the fair value of the services being rendered over the requisite service period.

A 10% increase (decrease) in the historical volatility utilized to estimate the grant date fair value of the Advisory Warrants would have resulted in an increase (decrease) of $0.7 million ($0.8 million) in the grant date fair value of the Advisory Warrants.

A 10% increase (decrease) in our assets under management as of the Fee Reference Date would have resulted in a $0.2 million increase (decrease) in the fair value of the liabilities settled through issuance of the GSR Pre-Funded Warrants.

Valuation of Covered Call Options

Covered Call Options written by us are accounted for in accordance with ASC 815, Derivatives and Hedging.Such instruments do not qualify for hedge accounting and are considered freestanding financial instruments and were evaluated to be liability instruments. Our Covered Call Options are initially recorded at fair value (the contract amount) and are marked-to-market at each reporting period (if they are still outstanding, using the Black-76 Model, with changes in the fair value of the derivative liability being recognized in the condensed consolidated statements of operations within other income (expense).

A 10% increase (decrease) in the historical volatility of LTC utilized to estimate the fair value of the derivative liabilities - covered call options would have resulted in an increase (decrease) of $8,500 ($7,600) in the fair value of the derivative liabilities - covered call options as of December 31, 2025.

A 10% increase (decrease) in the forward price as of December 31, 2025, would have resulted in an increase (decrease) of $0.1 million ($25,000) in the fair value of our derivative liabilities - covered call options.

Recent Accounting Pronouncements

See Recent Accounting Pronouncementswithin Note 2. Summary of Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report.