Antalpha Platform Holding Company

Good day and thank you for standing by. Welcome to N-Alpha second quarter 2025 earnings conference call. Today's call is being recorded. All participants are now in a listen-only mode. After management's prepared remarks, there will be a question and answer session. I would now like to turn the conference over to Chris Mamoni, Managing Director of the BlueShirt Group and representative of N-Alpha's investor relations team. Mr. Mamerni, please go ahead.

Thanks, Maggie. Please note that our remarks today will include forward-looking statements based on current expectations. These statements involve risks and uncertainties that could cause actual results to differ materially. For discussion of these risks, please refer to Antalpha's filings with the SEC. We do not undertake any obligation to update forward-looking statements except as required by law. This call also contains references to unaudited non-GAAP financial measures, Reconciliations to the most comparable gap measures can be found in our press release and SEC filings. Now, I'd like to turn the call over to Herman for his remarks. Herman, please go ahead.

Good afternoon, everyone, and thank you for joining our second quarter 2025 earnings call. Q2 was a solid step forward in Nalpha's growth journey. We became a publicly traded company, grew revenue by close to 50% year-over-year, and introduced new lending products. We are well positioned in the infrastructure layer of mining and the broader crypto market. The strength of Nalpha Prime's platform is reflected in our solid financial results and positive outlook. Let me briefly highlight the operating takeaways for Q2, and then Paul will cover the financial highlights. Q2 revenue was up 49% year over year to $17 million. which is an acceleration from the 41% growth reported in Q1. Sequentially, revenue was up 25%, meeting the high end of our guidance. Our adjusted EBITDA more than doubled to $3.8 million, and EBITDA margin expanded to 22%, up from 13% a year ago. Reflecting the operating leverage of AntAlpha Prime platform, In Q2, both the total number of institutional clients and average loan per client were up over 40% year-over-year. These strong results reflect customer stickiness and their desire to do more business with us over time, combined with robust net new client wins. Positive feedback from our clients indicate that they like the risk management system on N-alpha Prime. and that we provide friendly solutions to solve their mining issues after their purchase. In our nearly three years of operation, Enelpha has created a flywheel for our revenue to grow double digits and profits to grow triple digits on an annual basis. With the launch of Bitcoin ETFs last year and policy tailwinds for the crypto market, we believe we are in the early earnings of Bitcoin adoption and accumulation. And there's a long way ahead for Bitcoin mining. With the rapid growth of Bitcoin activity, the need for crypto collateralized financing is accelerating. Bitcoin mining is a CapEx and operating expenditure intensive business. If you look at other similar industries, the amount of external financing is substantial. For example, GM financed 38.6% of GM retail auto sales in 2024. Similarly, according to the National Association of Realtors, last November, 74 of all home purchases in the u.s were financed bitcoin investors have a term for themselves they are known as holders so for hold on for dear life they prefer to finance machine acquisitions and electricity costs so that they can fully benefit from bitcoin appreciation let me elaborate on how we are growing our total available markets our town is already substantial, with global hash rate growing and our penetration low at 8.8%. Yet we see many opportunities for increasing lending, and we're working on these initiatives. First, we are expanding our TAM through margin lending against crypto collateral. Our Bitcoin margin loans reach a TVL of 1.2 billion at the end of Q2. During Q2, we expanded this service by working with Northstar to offer margin loans against Ethereum, which has a market cap of about $470 billion. Our clients have told us they invest in Ethereum and would like to use such crypto assets to secure financing. This addition would increase our lending scenario. In Q2, we test piloted Ethereum collateralized loans for two customers and reached a TVL of $53 million. Next, we are developing financing products for adjacent closely related markets. We see opportunities in inference compute and potentially other infrastructure related services. AI inference compute and Bitcoin mining operate in a similar environment. So financing AI compute infrastructure is natural for us. We can leverage many advantages of our current mining compute operations including our strong network of vendors. The AI business is still in an early stage. NVIDIA inference machines are up and running in the US and we will soon be able to make this available for our customers to test pilot. Lastly, we're adding new clients by making it easy for public companies to enter Bitcoin mining. And Alpha has simplified Bitcoin mining operations to where a new entrant can add such business to their operations without previously having any mining know-how by leveraging our industry expertise and our financing solutions, as well as our network of service providers. This allows us to generate new business while our new lending clients return to healthy and profitable growth, a classic win-win scenario. An early success case study for us is Kangal, ticker symbol C-A-N-G. Kangal initiated a strategic transition into the Bitcoin sector to improve business performance when their core business was faced with sluggish industry growth. After purchasing 50 exahash of mining capacity, Tango is now generating significant revenue and free cash flow, albeit in digital form. In their July published reports, revenue surpassed an annualized run rate of $800 million, assuming the current Bitcoin price. Their market cap is up more than 3x in the past year. currently at around $860 million. Kangol is very happy with these results and has invited our CEO to join their board. More will work with the team to devise a new path in mining infrastructure with the cash flow that Kangol generates from Bitcoin mining. Kangol is just one example of the public companies adding Bitcoin mining to their business. Bitcoin mining is a good way to enter Bitcoin for a public company because you are not acquiring Bitcoin at any specific time, but over a period of time. Mining costs adjust downwards when Bitcoin prices drop. We are quite excited about newly listed entrants into the Bitcoin mining industry. Now, let me turn our attention to digital gold. The market sentiment for crypto and gold are both favorable. In Q2, both Bitcoin and gold rallied significantly, driven by heightened demand for institutional safe haven assets. Bitcoin was up nearly 30% sequentially in Q2 and approximately 90% since halving last year and over four times since the beginning of 2023. Demand has been driven by growing regulatory clarity in the U.S., inflows into Bitcoin ETS, and listed company treasury strategies. Meanwhile, gold surged 26% in the first half, underpinned by persistent geopolitical tensions, inflationary concerns, and central banks' diversification away from the U.S. dollar. In Q2 alone, gold hit multiple all-time highs, supported by safe haven demand and portfolio rebalancing toward precious metals. In the same period, we saw multiple instances where Bitcoin and gold moved in opposite directions in reaction to headline news and broader global developments. This sort of behavior is welcome because it confirms the wisdom of our strategy to hold digital gold as a balance to crypto volatility, just as investors hold bonds to balance an equity portfolio. We have purchased $20 million of Tether Gold, or XAUT, and plan to increase our gold holding over time. As we diversify our collateral position, we believe our clients will find interest in increasing the resiliency of their crypto-denominated treasury holdings. For example, our clients have suggested that we expand our lending to XAUT collateralized loans or provide yield to XAUT holders, to name a few. The latter is an interesting idea. When you deposit gold in Switzerland, you pay a custody. Depositing digital gold with a custody service provider also requires an annualized custody fee, around 50 basis points, I'm told. That leads us to think, what if we can offer digital gold depositors a yield instead of a tax on storage? This could be a game changer, especially for a lending platform like AnAlpha. Gold has a market cap of $23.5 trillion. That's about 80% of Treasury Bill's market. Assuming 80% of the market cap of USDT plus USDC suggests the market size for digital gold could reach $200 billion. Before I conclude on my prepared remarks, I'd like to give a warm welcome to Durar Issam, our new Chief Operating Officer. Durar previously served as the CEO of Genesis and later as its ex-acting CEO. He brings deep experience in the crypto lending space, particularly in the U.S. and EMEA. With our recent IPO, our participation at Bitcoin conferences in the U.S., and the addition of seasoned industry leaders like Durar, we are building a foundation for international expansion into the U.S. and into EMEA. Now, let me turn the call over to our CFO, Paul Lang, who will share the details of our financial performance for Q2.