Defi Technologies, Inc.

Hi, everyone. Welcome to the DeFi Technologies second quarter 2026 financial review and shareholder call. I'm Curtis Schlaufman, VP of Marketing and Communications. Joining me on the call today are Chief Executive Officer Johan Wattenstrom, Chief Financial Officer Paul Bozoki, and President Andrew Forson. We'll begin with opening remarks from Johan followed by a review of our second quarter 2026 financial results from Paul. We will then provide an update on growth initiatives and strategic priorities from Andrew and we'll open up for Q&A after that mix of retail from the chat and invite analysts to come on and ask questions live. Before we begin, I'd like to remind everyone that certain statements made during today's call may constitute forward-looking information under applicable securities laws. These statements include but are not limited to comments regarding expected financial performance, business development, strategic initiatives, market expansion, product growth, and future opportunities. Forward-looking statements are based on management's current expectations and assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied. With that, I'll turn it over to Johan.

Thank you, Curtis, and thank you everyone for joining us today. The second quarter was shaped by continued volatility across digital asset markets, as lower crypto asset prices affected assets under management, which together with the market-to-market adjustments weighted our reported financial results. While those market conditions impacted our financial numbers during the quarter, they have not changed our conviction in the long-term opportunity of the progress across the business. Our focus remains on executing our strategy, strengthening the platform and creating long-term value for shareholders. More importantly, the underlying business continues to move in the right direction. Our core business is becoming more scalable and efficient as we invest across our existing businesses, pursue strategic opportunities and advance product innovation. We believe these efforts are strengthening the platform, enhancing our competitive position and expanding all our long-term growth opportunities across all the business areas. Valor has listed over 100 listed ETPs and structured product across multiple exchanges globally, aiming for another eight more during Q3. During the quarter, Valor generated more than $22.8 million on net inflows reflecting continued customer demand for our products despite a challenging environment for the broader digital asset industry. We view these positive net inflows as an encouraging sign demonstrating continued demand for our products despite a weaker market environment and reinforcing our confidence in the long-term opportunities ahead. Beyond Valor, we continue to broaden our institutional platform product offering. The launch of our first hedge fund remains a key priority. With all obstacles now removed, we are days or at least at worst a week or two from the actual launch. We also expect to expand our arbitrage strategies during the second half of the year with the goal of further strengthening our institutional capability and diversifying our revenue streams. While the Swedish FSA did not approve our initial usage structure, we have appealed the decision and are simultaneously working hard to establish a usage platform in another domicile within the European Union. Those efforts are moving ahead quite quickly. Development of the ValorCustody platform also remains on track for a targeted beta launch in the second half of the year. The initial deployment will focus on bringing custody capabilities in-house, reducing third party custody costs and improving margins. Over time, the platform is expected to support a broader range of products and services. AI has also become an increasingly important part of our business. We are leveraging AI to improve operational efficiency while developing AI-enabled investment products, which we believe complement our existing crypto product offering and support future growth. From a financial standpoint, the company continues to operate from a position of strength. Our balance sheet and liquidity provide the flexibility to invest through the market cycle, support product innovation, pursue strategic acquisition opportunities, while also maintaining a disciplined approach to capital allocation. Stillman maintains a strong momentum in onboarding larger clients and remains on track for a second record year of revenue. As market conditions improve, we believe the business is positioned for a symmetric upside supported by continued growth in key operating metrics that are not primarily dependent on market volatility. Looking ahead, our priorities remain unchanged. We are focused on expanding our institutional capabilities, broadening our product offering, and building a more diversified business aligned with the long-term growth of digital assets. While near-term market conditions remain challenging, We believe the investments being made today are strengthening the business, expanding our capabilities, and positioning the company to capitalize on the next phase of growth. Our main focus during this market downturn is to aggressively take market share in our core markets. With that, I'll turn over to Paul to walk through the financial results.

Thank you, Johan, and good morning, everyone. I'll begin with an overview of assets under management. Average AUM for the quarter was approximately $471.5 million and quarter end AUM was approximately $397.2 million. Lower digital asset prices continued to weigh on reported assets under management during the quarter, consistent with conditions across the broader digital asset market. Our effective management fee yield was approximately 1% compared to approximately 1% in the prior period, primarily reflecting the larger weighting of Bitcoin-related products within our AUM, which carry lower or no management fees, as well as continued weakness across many altcoin markets. Within Velour, our effective staking yield of 2.4% also moderated during the quarter as lower digital asset prices, compression in lending rates for Bitcoin and Ethereum, and changes in the composition of staking assets reduced overall monetization. Client activity remained encouraging despite these market-driven headwinds. Valor generated $22.8 million of net inflows during the quarter, reflecting continued demand for our products despite the broader market environment. These inflows provide a solid foundation for future growth in assets under management as digital asset prices recover. Total revenues for the quarter were $7.8 million compared to $11.2 million in the prior period, reflecting lower average assets under management and unfavorable mark-to-market adjustments on our digital asset holdings, which are recognized through revenue under our broker-dealer accounting structure. Excuse me. Company also maintained a fortress balance sheet, ending the quarter with $60.3 million in cash and cash equivalents. 19, sorry. Hmm. 19.1 million of stretch preferred shares in RWUSD financial assets, 10.4 million of USDT USDC tokens, and 30 million of digital asset treasury holdings for total liquidity of 119.8 million. For clarity for our investors about the obvious drop in our cash balance from Q1, we bought $20 million of MicroStrategy Stretch preferred shares, or 200,914 shares, to achieve a higher yield on our treasury cash reserves. These preferred shares yield 12% or $1 per month. We also purchased a smaller position RWUSD product. Our short-term U.S. Treasury bill holdings yield approximately 3.5%, so these other products yield significantly more. These investments are disclosed on the face of our balance sheet as other investments at fair value through profit and loss, and again, at management, we view these as essentially cash equivalents, but they're not classified as such under IFRS rules. We believe this strong financial position provides flexibility to continue investing in strategic initiatives while maintaining a disciplined approach to capital allocation. Turning to product activity, we ended the quarter with 102 ETPs and structured products across our platform. We continue to expand our institutional product pipeline and distribution capabilities while advancing several new investment products and fund structures. Stillman Digital maintained an important diversification component of the broader platform. During the first half of 2026, Stillman generated approximately $5.4 million of revenue, representing 30.2% year-over-year growth. We remain encouraged by the business's trajectory and its contribution to the overall platform as it paces for a record revenue year. We remind our investors that Stillman revenue growth is not dependent on cryptocurrency prices increasing, but rather on trading volumes and realized trading spreads. Turning to operating expenses, general and min expenses and fees and commissions, which are our main cash costs, totaled $8 million in the quarter, which represents a $1.6 million reduction from the $9.6 million incurred in Q1 2026 of these costs. We remain focused on disciplined cost management and continue working towards our targeted annualized cash operating cost structure of $36 to $39 million while continuing to invest in our business. Our bottom line result was negatively affected by 16.3 million negative mark-to-market adjustments on our venture portfolio, as well as our stretch preferred shares. Most of the negative adjustment is from the markdown of our 5% investment in Amina Bank to reflect lower AUM and a compression in EV to AUM multiples across a valuation peer group. We are aware of publicly available information that Amina Bank has engaged Canto Fitzgerald to explore a potential public listing for it. With that, I'll turn it over to Andrew.