DeFi Development Corp.
11/12/2026 | Press release | Distributed by Public on 11/12/2026 07:51
Quarterly Report for Quarter Ending SEPTEMBER 30, 2026 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements that involve expectations, plans, or intentions. These statements include but are not limited to discussions on our strategy, future operations, future revenue, projected costs, prospects, plans and objectives of management. These forward-looking statements can be identified by words such as "may," "will," "would," "should," "could," "expect," "anticipate," "believe," "estimate," "might," "intend," "continue," "strategy," "future," "opportunity," "plan," "predict," "project," "target," "potential", "forecast," and other similar expressions. These forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results and financial condition to significantly differ from those expressed or implied in our forward-looking statements. We discuss such risks and uncertainties in Part I, Item 1A, Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2025, as well as in our unaudited condensed consolidated financial statements, related notes, and the other information appearing in this report and our other filings with the Securities and Exchange Commission. We do not intend, and assume no obligation except as required by law, to update any of our forward-looking statements after the date of this report to reflect actual results, new information, or future events or circumstances. Readers are cautioned not to place undue reliance on such forward-looking statements and to read the following "Management's Discussion and Analysis of Financial Condition and Results of Operations" in conjunction with the unaudited condensed consolidated financial statements and the related notes that appear in this report. All references to "we," "us," "our," "the Company," and "DeFi Dev" refer to DeFi Development Corp. and its consolidated subsidiaries, unless otherwise noted.
The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand the results of operations and financial condition of DeFi Dev. MD&A is provided as a supplement to, and should be read in conjunction with, our Annual Report on Form 10-K for the year ended December 31, 2025, and our condensed consolidated financial statements and the accompanying Notes to the Condensed Consolidated Financial Statements (Part I, Item 1 of this Quarterly Report on Form 10-Q).
OVERVIEW
THE COMPANY
In 2025, we pivoted our primary business strategy to the acquisition, long-term holding, and active management of SOL and SOL-related digital assets. Our treasury strategy includes accumulating SOL, locked SOL, liquid staking tokens such as dfdvSOL, and other SOL-denominated or SOL-native positions. We also operate Solana validators, enabling us to participate directly in the Solana proof-of-stake consensus mechanism and generate staking rewards.
We continuously evaluate capital market conditions, the broader cryptoeconomy, and macroeconomic factors in determining the timing and structure of financing transactions used to support our digital asset treasury strategy. Our objective is to expand our exposure to the Solana ecosystem over the long term.
In addition to our digital asset treasury operations, we continue to operate our commercial real estate technology platform, which provides data, software subscriptions, and value-added services connecting commercial property borrowers and lenders, including banks, credit unions, Real Estate Investment Trusts ("REITs"), debt funds, and other institutional capital providers.
We consider these our two operating segments: "Digital Asset Treasury" and the "Real Estate Platform".
RECENT SIGNIFICANT DEVELOPMENTS
The following are the more significant developments in our business during the nine months ended September 30, 2026:
•On March 31, 2026, our Board of Directors approved the wind down of the legacy Janover Capital Markets and Janover Insurance businesses, which constituted substantially all of the operations of our Real Estate Platform segment. The wind down reflects our strategic decision to reallocate capital and management resources toward our digital asset treasury strategy and related initiatives, focusing on SOL and the Solana ecosystem. Substantially all operations of the Real Estate Platform segment ceased by the end of the second quarter 2026, with the exception of Groundbreaker Tech Inc.
•On May 26, 2026, holders of approximately 81.79% of the outstanding voting power of DeFi Dev approved by written consent the reincorporation of the Company from the State of Delaware to the State of Nevada by conversion. On June 26, 2026, we finalized our reincorporation in the State of Nevada.
•On September 8, 2026, we received net proceeds of $11.4 million in connection with the initial issuance and sale of our variable rate series C perpetual preferred stock ("CHAD Stock"), which includes the exercise of the underwriter's option. We used the proceeds to purchase SOL and for working capital purposes.
•On September 11, 2026, we entered into a sales agreement with R.F. Lafferty & Co., Inc., under which we may offer and sell from time to time shares of our CHAD Stock through an at-the-market offering ("CHAD Stock ATM").
•We repurchased a total of 1,601,747 shares of our common stock for $10.5 million under our share repurchase program.
•We received net proceeds of $43.0 million through the issuance of our common stock under our equity line of credit and common stock at-the-market offering ("Common Stock ATM"). We used the proceeds for working capital purposes.
•We received proceeds from digital asset financing arrangements of $232.7 million and repaid $101.8 million. We used the proceeds from these borrowing for working capital purposes and SOL decentralized finance ("DeFi") activities.
MODIFICATIONS TO THE SOLANA PROTOCOL
The Solana Network is an open-source blockchain whose development has historically been led and overseen by a group of core contributors, including the Solana Foundation, Solana Labs and independent developers. This core group of contributors periodically propose and implement updates to the Solana protocol, which is intended to enhance network performance, scalability, reliability and functionality.
The release of protocol updates on the Solana Network are not always immediately adopted and depends heavily on acceptance and adoption by validators to upgrade to the software containing the protocol updates. If validator acceptance and adoption is not sufficient, the network may experience fragmentation, or "forks", which could result in multiple versions of the network operating simultaneously and may adversely affect network stability, transaction processing and user activity.
Recent and ongoing developments have focused on improving transaction speed and scalability. As of the date of this Quarterly Report on Form 10-Q, the following Solana protocol developments have occurred or are currently being developed to occur:
•Alpenglow Consensus Protocol: In October 2026, Solana implemented a new consensus architecture, which replaced certain legacy consensus components, including the existing Proof-of-History mechanism. Alpenglow introduces a new validator voting mechanism designed to significantly reduce transaction finality times, with a target of approximately 150 milliseconds compared to approximately 12.8 seconds under the prior consensus mechanism. The upgrade is intended to improve network performance, transaction settlement efficiency and overall network reliability, which could positively impact network usage and staking and validator-related activities. Additional phases of Alpenglow remain under development. Although the initial phase has been implemented, its long-term impact on network performance, validator operations and the Company's Digital Asset Treasury segment remains uncertain.
•Firedancer: An independently developed validator client, referred to as "Firedancer", was introduced on the Solana Network in December 2025, with further development, software releases and adoption continuing through 2026. Firedancer is an independently developed version of the Solana validator software and is intended to improve performance, resiliency, and client diversity. During the implementation of Alpenglow, certain Firedancer based implementations were not supported in the initial consensus migration, requiring affected validators to utilize compatible validator software. Development efforts to support the updated consensus architecture are ongoing. Firedancer may reduce the risk of a network-wide interruption. However, the implementation of the software may cause risks for new bugs, new hardware or operational requirements for validators and potential instability during rollout.
•Network Performance and Capacity Upgrades: The Solana Network continues to implement protocol enhancements designed to increase transaction capacity and improve network performance. In July 2026, the Solana Network increased the maximum compute capacity per block from 60 million to 100 million compute units, representing an approximately 66% increase in block compute capacity. The increased capacity is intended to allow validators to process more transactions and computational activity within each block and provide additional network capacity during periods of high demand.
In addition, Agave 4.2, a release of the primary Solana validator client introduced in August 2026, included network performance enhancements relating to transaction processing, transaction size limitations and slot times. In October 2026, the Solana Network completed the phased activation of protocol enhancements reducing targeted slot times from approximately 400 milliseconds to 200 milliseconds, increasing the frequency at which blocks may be produced. Additional enhancements relating to network efficiency and validator performance remain under development.
These and other network upgrades may improve network efficiency, transaction throughput and performance and reduce congestion during periods of high demand. However, the timing, successful implementation and impact of these upgrades on network activity and our Digital Asset Treasury segment remain uncertain.
•Validator Economics and Fee Distribution: The Solana Network continues to develop and implement protocol changes affecting transaction fees, block rewards and other economic incentives available to validators and network participants. In connection with the October 2026 implementation of Alpenglow, the network transitioned from on-chain validator voting transactions to a new consensus voting mechanism and implemented a validator admission fee of 0.8 SOL per epoch, replacing certain voting transaction costs under the prior consensus mechanism. Additional changes to validator incentives and fee structures may be proposed or implemented in the future. The impact of these changes on staking and validator-related revenue in our Digital Asset Treasury segment remains uncertain.
The impact of these and other protocol changes to the Solana Network is inherently uncertain and remain subject to ongoing development, testing, validator acceptance and adoption and timing. Accordingly, we cannot predict whether, or to what extent, such changes will affect our Digital Asset Treasury segment.
SELECTED CONSOLIDATED OPERATING RESULTS
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in thousands) | 2026 | 2025 | $ Change | % Change | 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||
| Revenue | $ | 2,432 | $ | 4,625 | $ | (2,193) | (47.4) | % | $ | 8,410 | $ | 6,898 | $ | 1,512 | 21.9 | % | ||||||||||||||||||||||||||||
| Net gain (loss) on digital assets | $ | 37,946 | $ | 74,368 | $ | (36,422) | (49.0) | % | $ | (34,603) | $ | 95,561 | $ | (130,164) | (136.2) | % | ||||||||||||||||||||||||||||
|
Operating expenses(a)
|
$ | 4,275 | $ | 6,907 | $ | (2,632) | (38.1) | % | $ | 15,764 | $ | 14,067 | $ | 1,697 | 12.1 | % | ||||||||||||||||||||||||||||
| Operating income (loss) | $ | 36,103 | $ | 72,086 | $ | (35,983) | (49.9) | % | $ | (41,957) | $ | 88,392 | $ | (130,349) | (147.5) | % | ||||||||||||||||||||||||||||
| Interest expense | $ | 3,359 | $ | 2,933 | $ | 426 | 14.5 | % | $ | 9,756 | $ | 3,709 | $ | 6,047 | 163.0 | % | ||||||||||||||||||||||||||||
| Gain (loss) from derivative instruments | $ | 33,400 | $ | 4,639 | $ | 28,761 | 620.0 | % | $ | 10,587 | $ | 4,639 | $ | 5,948 | 128.2 | % | ||||||||||||||||||||||||||||
| Gain on retirement of debt | $ | - | $ | - | $ | - | - | % | $ | 2,849 | $ | - | $ | 2,849 | NM | |||||||||||||||||||||||||||||
| Investment and other income (expense), net | $ | 447 | $ | 169 | $ | 278 | 163.0 | % | $ | (5,808) | $ | 494 | $ | (6,302) | NM | |||||||||||||||||||||||||||||
| Income tax expense | $ | - | $ | 17,935 | $ | (17,935) | NM | $ | 1 | $ | 19,136 | $ | (19,135) | NM | ||||||||||||||||||||||||||||||
| Net income (loss) | $ | 66,591 | $ | 56,026 | $ | 10,565 | 18.9 | % | $ | (44,086) | $ | 70,680 | $ | (114,766) | (162.4) | % | ||||||||||||||||||||||||||||
| (a) Excludes net gain (loss) on digital assets. | ||||||||||||||||||||||||||||||||||||||||||||
| Percentage changes deemed not meaningful are indicated by "NM". | ||||||||||||||||||||||||||||||||||||||||||||
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2026 AND 2025
Consolidated Revenue
Consolidated revenue decreased $2.2 million, or 47.4%, for the three months ended September 30, 2026, compared to the same period in 2025, primarily due to the decline in the value of SOL relative to the U.S. Dollar and the absence of revenue from Janover Pro ("JPro"), which was disposed of in the third quarter of 2025. These decreases were partially offset by an increase in staking reward revenue generated from a larger SOL staked position in the current year period as compared to the prior year period.
Consolidated revenue increased $1.5 million, or 21.9%, for the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to revenue generated from DeFi protocols and an increase in staking rewards revenue.
These increases were partially offset by a decline in the value of SOL relative to the U.S. Dollar and the absence of revenue from JPro, which was disposed of in the third quarter of 2025.
Consolidated Net Gain (Loss) on Digital Assets
Consolidated net gain (loss) on digital assets for the three months ended September 30, 2026, reflects $53.4 million of gains resulting from the appreciation of SOL relative to the U.S. Dollar, partially offset by $14.8 million of realized losses from the conversion of a portion of our SOL holdings into liquid staking tokens and the sale of digital assets, as well as $0.7 million of impairments driven by our liquid staking tokens.
Consolidated net gain (loss) on digital assets for the nine months ended September 30, 2026, reflects $45.9 million of realized losses resulting from the conversion of a portion of our SOL holdings into liquid staking tokens and the sale of digital assets, as well as $21.4 million of impairments driven by our liquid staking tokens, partially offset by $32.6 million of gains resulting from the appreciation of SOL relative to the U.S. Dollar.
Consolidated Operating Expenses
Consolidated operating expenses decreased $2.6 million, or 38.1%, for the three months ended September 30, 2026, compared to the same period in 2025, primarily due to the absence of a $2.0 million loss from the disposition of JPro in the prior year period.
Consolidated operating expenses increased $1.7 million, or 12.1%, for the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to general and administrative expenses related to professional fees and employee-related costs, which was partially offset by the absence of a $2.0 million loss on the disposition of JPro in the prior year period.
Consolidated Interest Expense
Consolidated interest expense was consistent for the three months ended September 30, 2026 compared to the same period in 2025.
Consolidated interest expense increased $6.0 million, or 163.0%, for the nine months ended September 30, 2026, compared to the same period in 2025, primarily driven by interest expense on our July Notes and an increase in the average outstanding borrowings under our digital asset financing arrangements.
Consolidated Gain (Loss) From Derivative Instruments
Consolidated gain (loss) from derivative instruments generated for the three months ended September 30, 2026, reflects gains of $88.3 million driven by increases in the fair value of collateral related to our digital asset financing arrangements, partially offset by $54.9 million of losses related to increases in the fair value of our digital asset financing arrangements.
Consolidated gain (loss) from derivative instruments generated for the nine months ended September 30, 2026, reflects $35.1 million of gains driven by increases in the fair value of collateral related to our digital asset financing arrangements, partially offset by losses of $24.5 million related to increases in the fair value of our digital asset financing arrangements.
Consolidated Investment and Other Income (Expense), Net
Consolidated investment and other income (expense), net was consistent for the three months ended September 30, 2026, compared to the same period in 2025.
The decrease in consolidated investment and other income (expense), net for the nine months ended September 30, 2026, compared to the same period in 2025, was primarily attributable to the ELOC commitment fee of $5.4 million.
Consolidated Gain on the Retirement of Debt
Consolidated gain on the retirement of debt was consistent for the three months ended September 30, 2026, compared to the same period in 2025.
Consolidated gain on the retirement of debt for the nine months ended September 30, 2026, was $2.8 million, resulting from the repurchase of certain July 2030 Notes (as defined in Note 8-Debt) for $5.0 million, which had a net carrying value of $7.9 million. See Note 8-Debt of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1, of this Quarterly Report on Form 10-Q, for further discussion.
Consolidated Income Tax Expense
Consolidated income tax expense for the three and nine months ended September 30, 2026 decreased $17.9 million and $19.1 million, respectively, compared to the corresponding periods in 2025, primarily due to the recognition of a valuation allowance against deferred tax assets arising from our U.S. losses, for which no income tax benefit will be realized.
SEGMENT OPERATING RESULTS
Our segment operating results are presented based on how management evaluates operating performance and internally reports financial information. See Note 4-Segments of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1, of this Quarterly Report on Form 10-Q, for further discussion on our segments.
DIGITAL ASSET TREASURY
In 2025, our Board of Directors adopted a new treasury policy, which updated our treasury management to include digital assets, starting with Solana's native token, SOL. We believe acquiring and holding SOL long-term provides diversification of our treasury holdings and additional growth opportunities through operating validators and staking rewards. We believe that investing in the Solana Network through its native token provides an opportunity for us to create value for our shareholders due to the continuous disruptive innovation the network offers to various industries. Currently, Solana is a category leader in decentralized finance, gaming and metaverse, decentralized physical infrastructure networks, asset tokenization, payment processing, and global value transfer.
Our digital asset treasury strategy is primarily funded through various financing transactions including, among others, issuing common stock, and to a lesser extent, cash on hand from our operations. Management continuously evaluates current market conditions of the overall cryptoeconomy, capital market conditions, and macroeconomic conditions to determine whether to enter into additional financing transactions. Management intends to focus on accumulating digital assets, focusing on SOL, and holding it long-term. We currently do not have a specific target for the amount or type of digital asset holdings we intend to acquire and hold, nor do we have specific plans to acquire a significant amount of any cryptocurrency other than SOL.
Our operating results and financial condition is and will continue to be impacted by price volatility in digital asset markets, which may cause significant fluctuations from period to period and may not be necessarily indicative of future performance. In addition, our revenue may vary due to changes in staking reward yields and Solana protocol defined reward structures, including the annual inflationary rate.
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | $ Change | % Change | 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||
| Revenue | $ | 2,379 | $ | 3,794 | $ | (1,415) | (37.3 | %) | $ | 8,037 | $ | 5,000 | $ | 3,037 | 60.8 | % | ||||||||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues | 22 | 81 | (59) | (72.8 | %) | 132 | 101 | 31 | 30.6 | % | ||||||||||||||||||||||||||||||||||
| General and administrative | 3,655 | 3,313 | 342 | 10.3 | % | 12,696 | 7,709 | 4,987 | 64.7 | % | ||||||||||||||||||||||||||||||||||
| Sales and marketing | 87 | 222 | (135) | (60.7 | %) | 344 | 303 | 41 | 13.4 | % | ||||||||||||||||||||||||||||||||||
| Research and development | 139 | 145 | (6) | (4.0 | %) | 346 | 302 | 44 | 14.6 | % | ||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 304 | 303 | 1 | - | % | 911 | 506 | 405 | 80.0 | % | ||||||||||||||||||||||||||||||||||
| Net (gain) loss on digital assets | (37,946) | (74,368) | 36,422 | 49.0 | % | 34,603 | (95,561) | (130,164) | (136.2 | %) | ||||||||||||||||||||||||||||||||||
| Total operating expenses | (33,739) | (70,304) | 36,565 | 52.0 | % | 49,032 | (86,640) | 135,672 | 156.6 | % | ||||||||||||||||||||||||||||||||||
| Segment operating income (loss) | $ | 36,118 | $ | 74,098 | $ | (37,980) | (51.3 | %) | $ | (40,995) | $ | 91,640 | $ | (132,635) | (144.7 | %) | ||||||||||||||||||||||||||||
Revenue
Revenue decreased $1.4 million, or 37.3%, for the three months ended September 30, 2026 as compared to the same period in 2025, primarily due to an impact of approximately $2.8 million from the decline of SOL's value relative to the U.S. Dollar, partially offset by an increase in staking reward revenue of approximately $1.0 million generated from a larger SOL staked position in the current year period as compared to the prior year period and an increase of $0.4 million in revenue from DeFi protocols.
The increase of $3.0 million, or 60.8%, in revenue for the nine months ended September 30, 2026, as compared to the same period in 2025, was driven by our digital asset strategy shift in the second quarter of 2025, resulting in the inclusion of nine months of results in 2026 and an increase in revenue of $1.9 million from DeFi protocols, partially offset by the decline of SOL's value relative to the U.S. Dollar of approximately $7.0 million.
Operating Expenses
General and Administrative
General and administrative expenses were consistent for the three months ended September 30, 2026, compared to the same period in 2025.
General and administrative expenses increased $5.0 million, or 64.7%, for the nine months ended September 30, 2026, as compared to the same period in 2025, primarily due to an increase of $2.1 million in professional fees and a $3.1 million increase in employee-related costs.
Net (Gain) Loss on Digital Assets
Net (gain) loss on digital assets generated for the three months ended September 30, 2026, reflects $53.4 million of gains resulting from the appreciation of SOL relative to the U.S. Dollar, partially offset by $14.8 million of realized losses resulting from the conversion of a portion of our SOL holdings into liquid staking tokens and the sale of digital assets, as well as $0.7 million of impairments driven by our liquid staking tokens.
Net (gain) loss on digital assets generated for the nine months ended September 30, 2026, reflects $45.9 million of realized losses resulting from the conversion of a portion of our SOL holdings into liquid staking tokens and the sale of digital assets, as well as $21.4 million of impairments driven by our liquid staking tokens, partially offset by $32.6 million of gains resulting from the appreciation of SOL relative to the U.S. Dollar.
REAL ESTATE PLATFORM
We have developed a platform that connects commercial mortgage and small business borrowers looking for debt to refinance, build, or buy commercial property, including apartment buildings, to commercial property lenders. These property lenders include traditional banks, credit unions, REITs, debt funds, and other financial institutions looking to deploy capital into commercial mortgages. The platform connects borrowers to our internal capital markets advisors who guide the borrower through the process and connect them with the right loan product and lender.
The Real Estate Platform segment derives its revenue primarily from platform fees and subscription revenue. Platform fees include referral and advisory fees generated from multifamily and commercial real estate and small business debt transactions. We earn platform revenue from fees charged to our customers that utilize our platform and our capital markets advisor sales team, who will assist in the match between lenders and borrowers. These fees include a share of the revenue per transaction by the lender, typically 1% of the loan amount, and in some cases a fixed negotiated fee from the borrower.
Our data and software offerings are generally offered on a subscription basis. We provide data, transparency, and tools, generally as annual software subscriptions, to help stakeholders navigate the most complex components of the multifamily and commercial property lifecycles - debt (Janover Capital Markets), insurance (Janover Insurance), and equity (Janover Connect, Janover Engage).
On March 31, 2026, our Board of Directors approved the wind down of the legacy Janover Capital Markets and Janover Insurance businesses, which constituted substantially all of the operations of our Real Estate Platform segment. The wind down reflects our strategic decision to reallocate capital and management resources toward our digital asset treasury strategy and related initiatives, focusing on SOL and the Solana ecosystem. Substantially all operations of the Real Estate Platform segment ceased at the end of the second quarter 2026, with the exception of Groundbreaker Tech Inc.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | $ Change | % Change | 2026 | 2025 | $ Change | % Change | |||||||||||||||||||||||||||||||||
| Revenue | $ | 53 | $ | 831 | $ | (778) | (93.6 | %) | $ | 373 | $ | 1,898 | $ | (1,525) | (80.4 | %) | |||||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||||||||||||
| Cost of revenues | 7 | 7 | - | (2.1 | %) | 21 | 21 | - | - | % | |||||||||||||||||||||||||||||||
| General and administrative | 4 | 259 | (255) | (98.5 | %) | 1,028 | 1,084 | (56) | (5.1 | %) | |||||||||||||||||||||||||||||||
| Sales and marketing | 7 | 446 | (439) | (98.4 | %) | 123 | 1,511 | (1,388) | (91.8 | %) | |||||||||||||||||||||||||||||||
| Research and development | 1 | 124 | (123) | (99.1 | %) | 18 | 449 | (431) | (95.8) | % | |||||||||||||||||||||||||||||||
| Depreciation and amortization | 49 | 49 | - | 0.3 | % | 145 | 187 | (42) | (22.6 | %) | |||||||||||||||||||||||||||||||
| Loss on disposition of Janover Pro | - | 1,958 | (1,958) | NM | - | 1,958 | (1,958) | NM | |||||||||||||||||||||||||||||||||
| (Gain) loss from changes in fair value of contingent consideration | - | - | - | - | - | (64) | 64 | NM | |||||||||||||||||||||||||||||||||
| Total operating expenses | 68 | 2,843 | (2,775) | (97.6 | %) | 1,335 | 5,146 | (3,811) | (74.0 | %) | |||||||||||||||||||||||||||||||
| Segment operating income (loss) | $ | (15) | $ | (2,012) | $ | 1,997 | 99.3 | % | $ | (962) | $ | (3,248) | $ | 2,286 | 70.3 | % | |||||||||||||||||||||||||
Percentage changes deemed not meaningful are indicated by "NM".
Revenue
Real estate revenue decreased $0.8 million and $1.5 million, or 93.6% and 80.4%, for the three and nine months ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to the disposition of JPro, representing the majority of our subscription revenue in fiscal 2025, and the wind down of the legacy Janover Capital Markets and Janover Insurance businesses, which was completed at the end of the second quarter 2026.
Operating Expenses
Sales and Marketing
Sales and marketing decreased $0.4 million and $1.4 million, or 98.4% and 91.8%, for the three and nine months ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to the disposition of JPro, and the wind down of the legacy Janover Capital Markets and Janover Insurance businesses.
Loss on the Disposition of Janover Pro
Loss on the disposition of JPro decreased for the three and nine months ended September 30, 2026 as compared to the same periods in 2025 due to the absence of the loss associated with the disposition in the current year period.
LIQUIDITY AND CAPITAL RESOURCES
| (in thousands) | September 30, 2026 | December 31, 2025 | |||||||||
| Sources of liquidity: | |||||||||||
| Cash and cash equivalents | $ | 11,241 | $ | 5,920 | |||||||
| Marketable securities | $ | 631 | $ | 698 | |||||||
| Obligations: | |||||||||||
| Loans payable | $ | - | $ | 107 | |||||||
| Digital asset financing arrangements | $ | 225,933 | $ | 67,521 | |||||||
| Long-term debt, net | $ | 120,998 | $ | 127,361 | |||||||
We believe that the sources of liquidity discussed below, and access to capital markets will be sufficient in both the short and long term to meet our working capital requirements and future obligations.
SOURCES OF LIQUIDITY
Principal Sources of Liquidity
As of September 30, 2026, our principal sources of liquidity consist of cash and cash equivalents and marketable securities.
•Cash and cash equivalents: represents our most immediately available source of liquidity and consisted of demand deposits and money market instruments.
•Marketable securities: consist of publicly-held equity securities, which are held at fair value and may be liquidated to generate cash, subject to market conditions.
Capital Markets
Common Stock ATM
On May 1, 2026, we entered into a sales agreement, with R.F. Lafferty & Co., Inc., ("R.F. Lafferty"), under which we may offer and sell from time to time shares of our common stock, par value $0.00001 per share, through an at-the-market offering. In accordance with the sales agreement, we may offer and sell shares of our common stock having an aggregate initial offering price of up to $200.0 million from time to time through R.F. Lafferty, acting as our sales agent or as principal.
During the nine months ended September 30, 2026, we sold an aggregate of 7,845,968 shares of our common stock under the Common Stock ATM and received $41.1 million of proceeds net of sales commissions and expenses. As of September 30, 2026 we had $158.8 million of remaining capacity under the Common Stock ATM.
CHAD Stock
On September 3, 2026, we entered into an underwriting agreement with R.F. Lafferty in connection with the issuance and sale of 1,375,000 shares of our CHAD Stock, par value $0.00001 per share, at a public offering price of $8.00 per share. On September 8, 2026, the initial offering closed, resulting in gross proceeds of $11.0 million and net proceeds of $9.8 million after deducting underwriting discounts, commissions and offering costs.
In connection with the CHAD Stock offering, we also granted R.F. Lafferty a 30-day option to purchase an additional 206,250 shares at the public offering price. The option was exercised in full, resulting in gross proceeds of $1.65 million and net proceeds of $1.6 million after deduction underwriting discounts, commissions and offering costs.
CHAD Stock ATM
On September 11, 2026, we entered into a sales agreement with R.F. Lafferty, under which we may offer and sell from time to time shares of our CHAD Stock through an at-the-market offering. In accordance with the sales agreement, we may offer and sell up to 30.0 million shares of our CHAD Stock through R.F. Lafferty, acting as our sales agent or as principal. The Company intends to issue shares under the CHAD Stock ATM at or above $10.00 per share, CHAD Stock's par value. During the third quarter 2026, we did not sell any shares of our CHAD Stock under the CHAD Stock ATM and had 30.0 million shares available.
Potential Sources of Liquidity
Equity Line of Credit
On June 11, 2025, we entered into a share purchase agreement with RK Capital Management LLC that provided us with an equity line of credit ("ELOC"), where we have the right, but not the obligation, to sell up to $1.0 billion of our common stock over a 36 month period, subject to the terms and conditions of the agreement. We may request a one-time increase in the commitment amount up to an aggregate of $5.0 billion, subject to certain conditions.
The amount and timing of proceeds are at our discretion and are dependent on several factors, including the market price and trading volume of our common stock, current market conditions and compliance with contractual and regulatory limitations. Although the ELOC represents a significant potential source of liquidity, it does not constitute a committed source of cash, and we may not be able to access the facility on favorable terms, or at all, at the times or in the amounts desired.
During periods when market conditions are favorable, we expect to utilize the ELOC as an important component of our external liquidity strategy to fund working capital requirements, strategic initiatives and digital asset treasury activities. During the nine months ended September 30, 2026, we received $1.9 million of net proceeds under the ELOC.
As of September 30, 2026, approximately $939.9 million remained available under the ELOC, subject to the terms and conditions of the agreement.
Digital Assets
As of September 30, 2026, our digital asset holdings were $204.0 million, and had an aggregate fair value of $223.8 million (using exchange rates as of the balance sheet date), of which $129.2 million is unencumbered, and may be sold to generate liquidity. Management may from time to time, if necessary, and subject to crypto market conditions, monetize the digital assets we receive from staking activities and validator operations to meet liquidity needs.
Cash Flows
The following table summarizes our cash flows from operating, investing, and financing activities:
| Nine Months Ended September 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Net cash used in operating activities | $ | (21,000) | $ | (7,041) | |||||||
| Net cash used in investing activities | $ | (11,955) | $ | (236,311) | |||||||
| Net cash provided by financing activities | $ | 38,276 | $ | 249,636 | |||||||
Net cash used in operating activities was $21.0 million for the nine months ended September 30, 2026, reflecting payments for interest on our debt, professional services and employee-related costs.
Net cash used in investing activities was $12.0 million for the nine months ended September 30, 2026, primarily consisting of purchases of digital assets and investments, partially offset by proceeds from the sale of digital assets and investments.
Net cash provided by financing activities was $38.3 million for the nine months ended September 30, 2026, reflecting proceeds from initial issuance of our CHAD Stock and issuances of our common stock under the Common Stock ATM and ELOC, partially offset by repurchases of shares of our common stock under our share repurchase program and the repurchase of certain July 2030 convertible notes.
MATERIAL CASH REQUIREMENTS AND OTHER OBLIGATIONS
Short-Term Liquidity Requirements
Our short-term obligations include working capital requirements, short-term debt, digital asset financing arrangements, and interest payments related to our convertible notes and dividend payments on our CHAD Stock.
•Interest payments on long-term debt: Under the terms of our convertible notes, we are required to make periodic interest payments. The April Notes (as defined in Note 8-Debt) have an interest rate of 2.5%, which accrues daily and is required to be paid quarterly in arrears on March 31, June 30, September 30 and December 31 each year. Our July Notes (as defined in Note 8-Debt) have an interest rate of 5.5%, which is calculated based on a 360-day year and is required to be paid semi-annually in arrears on January 1 and July 1 of each year.
•Digital asset financing arrangements, term loans: We entered into several digital asset financing arrangements where we borrowed SOL, with annual contractual borrowing fees ranging from 10.0% to 13.0% payable on the loan maturity date. These arrangements require us to provide collateral denominated in SOL with initial levels of 200.0% to 300.0% of the total loan value and must maintain a minimum collateral coverage between 175.0% to 200.0%. If the value of the posted collateral falls below this threshold we may be required to post additional SOL. If the collateral coverage declines to 150.0% or lower and is not remediated in a timely manner, the lender has the right to liquidate some or all of the posted collateral. In addition, we also entered into a callable open term loan under the previously mentioned master loan agreement, where we borrowed $4.0 million USD Coin ("USDC"). Repayments of our digital asset financing arrangements is required to be settled in the borrowed digital asset. Our ability to repay the loans and comply with collateral requirements is subject to availability of SOL and USDC in our digital asset treasury and the fluctuations in the price of these assets. During the third quarter 2026, we repaid the outstanding balance on the aforementioned term loans.
•Digital asset financing arrangements, collateralized financing arrangements: We enter into digital asset financing arrangements through DeFi protocols that allow digital assets to be deposited as collateral in order to obtain
borrowings of additional digital assets. We may redeposit these borrowed assets into lending protocols and subsequently borrow additional assets against those deposits. This strategy is intended to increase our exposure to staking rewards, lending yields and other protocol incentives. The borrowed digital assets do not have a specified maturity date and are repayable at our option at any time. The interest rate on these borrowings are established by each DeFi protocol and are variable. The interest rate is determined based on the borrow demand for each digital asset on the DeFi protocol. Interest is calculated daily and payable on the date repayment is made. As of September 30, 2026, we had $225.9 million outstanding under our collateralized financing arrangements.
•CHAD Stock dividends: In September 2026, we completed an underwritten public offering for our CHAD Stock, which provides for cumulative cash dividends at a variable annual rate, which was initially set at 13.0%. The payment of dividends on our CHAD Stock represents an ongoing use of our cash resources. The amount of future dividend payments will depend on the number of shares outstanding, the applicable dividend rate and the timing of payments. We expect to fund such payments through our established dividend reserves, which is funded by available cash, cash generated from operations and other available sources of liquidity.
Long-Term Liquidity Requirements
Our long-term obligations include outstanding principal repayments of our long-term debt and interest payments related to that debt.
•Long-term debt: The outstanding principal balance on our convertible notes have maturity dates of April 6, 2030 and July 1, 2030. As of September 30, 2026, the outstanding principal balances on the April Notes and July Notes were $11.5 million and $114.6 million, respectively.
SHARE REPURCHASES AND DIVIDENDS
Common Stock
In November 2023, our Board of Directors authorized a share repurchase program that provided for the repurchase of up to $1.0 million of our common stock, with no expiration from the date of authorization. In September 2025, our Board of Directors authorized an increase to the current share repurchase program up to $100.0 million. Under this authorization, an initial $10.0 million threshold has been established, and management must obtain Board approval before making any additional repurchases. Subsequently, on January 8, 2026, the Board of Directors increased the previously mentioned threshold by $15.0 million to $25.0 million. As of September 30, 2026, we had $78.0 million remaining under the authorization.
We expect to repurchase additional shares of our common stock under the authorization in the open market or in private transactions. The timing, method, and amount of future repurchases will be determined by management based on its evaluation of market conditions and other factors. The repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be modified, suspended, or discontinued at any time.
CHAD Stock
On October 2, 2026, our Board of Directors authorized a share repurchase program that provided for the repurchase, from time to time, up to all of the shares of CHAD Stock that are issued and outstanding at any time. The authorization is not limited to the amount of CHAD Stock currently outstanding and is not exhausted by prior repurchases.
We expect to repurchase shares of our CHAD Stock under the authorization in the open market or in private transactions. The timing, method, and amount of future repurchases will be determined by management based on its evaluation of market conditions and other factors. The repurchase program does not obligate the Company to acquire any particular amount of CHAD Stock, and it may be modified, suspended, or discontinued at any time.
Dividends
In September 2026, we issued shares of our CHAD Stock, which entitle holders to cumulative cash dividends at a variable annual rate, which was initially established at 13.0%. Dividends accrue daily and are payable daily if and when declared by our Board of Directors. The dividend rate is determined by the dividend committee of our Board of Directors at least monthly and may be adjusted based on prevailing cryptocurrency market conditions, the trading price of CHAD Stock, interest rates, yields on comparable securities and our liquidity and capital requirements.
On September 15, 2026, the dividend committee of our Board of Directors, declared a dividend of $1.30 per share on an annualized basis for holders of record on September 30, 2026, covering the period from the initial issuance date through September 30, 2026, which was subsequently paid on October 1, 2026. Additionally, on September 15, 2026, the dividend
committee of the Board of Directors declared a dividend of $1.30 per share on an annualized basis for the dividend period covering October 1, 2026 to October 30, 2026.
On October 15, 2026, we announced an increase in the annualized dividend rate from 13.0% to 14.0%, effective November 2, 2026. The revised dividend rate represents annualized dividends of $1.40 per share based on the $10.00 stated amount per share of CHAD Stock, which is subject to declaration by the dividend committee of our Board of Directors.
CRITICAL ACCOUNTING ESTIMATES
The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses during the reported period. Actual results may differ significantly from these estimates and assumptions. Note 1-Overview and Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q and the Notes to the Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2025 describe the significant accounting policies and methods used in the preparation of our condensed consolidated financial statements. There have been no material changes to the Company's critical accounting estimates since the Annual Report on Form 10-K for the year ended December 31, 2025.
DeFi Development Corp. published this content on November 12, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT) on November 12, 2026 at 13:51 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]