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AI Financial Corp

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Business Summary

ALT5 Sigma Corporation operates in the digital asset and fintech industry, providing blockchain-powered technologies for digital asset trading, payments processing, and related payment card services. The company also holds clinical-stage biopharmaceutical assets focused on non-opioid therapies for pain and addiction, though this segment is presented as discontinued operations. The global digital assets market capitalization reached approximately $3.91 trillion by mid-December 2024 before consolidating at $3.0 trillion , while the U.S. equity markets had a market capitalization of approximately $72 trillion as of December 2025. Worldwide average trading volume of all assets is approximately $12-$14 trillion per day , with digital assets representing approximately 1.2% of global volume. Global trading volume is growing at a compounded annual growth rate of approximately 9% , while digital assets trading volume is growing at a compounded annual growth rate of approximately 17% . The global payments industry revenue reached $2.5 trillion in 2025 and is projected to reach $2.7 trillion in 2026 at an annualized growth rate of 7% . The crypto payment gateway market size is expected to reach $3.5 billion by 2030 , growing at a CAGR of 15.6% from $1.5 billion in 2024 .

The company's primary competitors named in the filing include Coinbase, Gemini, Crypto.com, Kraken, and Binance, which primarily target retail digital asset investors and currently account for the largest trading volume in dollar equivalent and number of coins traded. ALT5 Sigma's services are aimed at business-to-business customers, and the company offers a white-label product that can be seamlessly integrated with a customer's existing systems, providing a competitive advantage. The company's main target market and focus are FINRA-registered broker dealers, banks, and global merchants. According to the filing, there are 3,249 broker-dealers registered and under FINRA's supervision, representing approximately 628,000 registered representatives. ALT5 Sigma Canada projects that 3% of assets currently allocated to U.S. equities will transition to digital assets over the next 36-to-60 months, representing approximately $2.16 trillion based on the current U.S. equity market capitalization of $72 trillion . The company anticipates that FINRA broker-dealers will aggregate 90% of the daily trading volume, representing $342 billion of daily trading volume or $124.8 trillion in annual trading volume and potential revenues of $8.64 billion .

The company generates revenue through its Fintech segment via three main line items: installation or one-time setup fees, monthly maintenance fees, and transaction fees ranging from 0.25% to 5% on all transactions depending on industry and volume. Revenue is recognized under Topic 606, with the company acting as principal in all transactions. The company has approximately 1,900 corporate customers located in 50 countries. The Fintech segment's transaction volume reached $8.0 billion cumulatively since inception, with $39.0 million in 2020, $442.0 million in 2021, $743.0 million in 2022, $1.1 billion in 2023, $2.2 billion in 2024, and $3.5 billion in 2025.

The company's Fintech segment offers three main platforms: ALT5 Pay, ALT5 Prime, and StrataCarte. ALT5 Pay is a cryptocurrency payment gateway that enables registered and approved global merchants to accept and make cryptocurrency payments, with the option to convert to fiat currency (U.S. Dollars, Canadian Dollars, Euros, and British Pounds Sterling) automatically or receive payment in digital assets. ALT5 Prime is an electronic over-the-counter trading platform that enables registered and approved customers to buy and sell digital assets, available through a browser-based application, a mobile phone application named ALT5 Pro, through ALT5 Prime's FIX API, and through Broadridge Financial Solutions' NYFIX gateway. StrataCarte is a next-generation payment solutions provider offering multi-currency, fiat payment card services with crypto-enabled capabilities, with physical and virtual cards available on both the Visa and Mastercard networks. The Fintech segment generated revenue of $24.840 million for fiscal 2025, with gross profit of $10.188 million and a gross margin percentage of 41.0% .

The company's Biotechnology segment holds clinical-stage biopharmaceutical assets focused on novel, non-opioid, and non-addictive therapies for pain and addiction. JAN101 (formerly TV1001SR) is a potential treatment for PAD, a vascular disease that affects more than 8.5 million people in the U.S. and more than 60 million people worldwide, with Phase IIb/III clinical trials expected to commence in 2026. JAN123 is a novel formulation of low-dose naltrexone (LDN) with biphasic release properties, initially expected to be administered as a single tablet orally once a day before sleep, with eventual titration up to two tablets before sleep. The FDA has granted Orphan Drug Designation for any product approved for treatment of CRPS, providing tax credits for clinical trials, exemption of user fees, and the potential of seven years of market exclusivity following approval. The Biotechnology segment is presented as a discontinued operation, with the company having formed Alyea Therapeutics Corporation and announced its intent to formally separate the segment.

On May 9, 2025, the company acquired Fortress II Holdings Ltd. d/b/a Mswipe, a next-generation payment solutions provider, for total consideration of $14.2 million , consisting of one million restricted shares of common stock valued at $6.10 per share, five hundred thousand 4-year common stock warrants with a per-share exercise price of $5.50 , shares in Alyea valued at $4.8 million , and two 14-month straight promissory notes with an interest rate of 3.99% per annum. The company also granted the sellers the right to one earn-out payment of $20 million if Mswipe generates a minimum of $15 million in annualized or actual total revenue. In August 2025, the company closed a $1.5 billion registered direct offering and concurrent private placement led by World Liberty Financial, Inc. to support its WLFI Treasury Strategy, acquiring WLFI tokens in two tranches at $0.20 per token: Tranche 1 of 3,750,000,000 WLFI tokens and Tranche 2 of 3,584,000,000 WLFI tokens. On January 29, 2026, the company drew down $15.0 million under the Master Loan and Security Agreement with WLFI, receiving net proceeds of approximately $14.2 million after prepayment of interest and reimbursement of lender expenses.

Total revenue for fiscal 2025 was $24.840 million , compared to $11.887 million in fiscal 2024. Gross profit was $10.188 million versus $5.649 million in the prior year. Operating loss was $22.851 million compared to $6.923 million in fiscal 2024. Net loss from continuing operations was $341.486 million versus $8.301 million in the prior year. Net loss was $344.507 million compared to $7.568 million in fiscal 2024. The net loss per share, basic and diluted, was $5.91 versus $0.68 in the prior year. Adjusted EBITDA was negative $15.429 million compared to negative $1.509 million in fiscal 2024.

Business Outlook

A major growth vector is the WLFI Treasury Strategy, initiated on August 12, 2025, with purchases of WLFI tokens at $0.20 per token across two tranches totaling 7,334,000,000 tokens. The company currently intends to integrate WLFI into its existing payment and trading infrastructure serving clients in North America, Europe, and Asia, with a vision including collaborating with WLFI to enable everyday commerce such as retailers accepting WLFI or USD1 with instant fiat conversion, cross-border B2B settlements, and tokenized assets settled using WLFI and/or USD1 as the medium of exchange. The company's policy remains a committed long-term approach, with future acquisitions funded through operating cash flows, structured debt, and selective capital raises, and sales restricted to liquidity requirements or material portfolio rebalancing events. The company holds approximately 7.3 billion WLFI tokens carried at a fair value of approximately $1.05 billion as of December 27, 2025.

Another growth vector is the acquisition of Mswipe (now StrataCarte), a next-generation payment solutions provider offering multi-currency, fiat payment card services with crypto-enabled capabilities. The acquisition exposes the company to the payments industry, with the global payments industry revenue reaching $2.5 trillion in 2025 and projected to reach $2.7 trillion in 2026. The crypto payment gateway market size is expected to reach $3.5 billion by 2030, growing at a CAGR of 15.6% from $1.5 billion in 2024. The company's sales and marketing strategy includes targeting primary markets through conferences, tradeshows, direct mailing, and digital advertising, with a focus on the United States and Canada as well as establishing partnerships in Europe and Asia.The company's operational outlook includes its Fintech segment's technology infrastructure, which supports multiple digital assets, fiat deposits (USD, CAD, EUR, and GBP), 24/7 support, various order types, and connections to FIX, Binary, WebSocket, REST, and custom APIs. The company has outsourced a portion of its sales and business development to resellers. As of December 27, 2025, the company had 16 employees, 15 of whom were full-time and one was part-time. The company's executive offices are located in Las Vegas, Nevada in a leased facility of 3,600 square feet, with Fintech segment offices in Montreal, Quebec, Canada across two leased facilities of approximately 2,100 and 2,500 square feet.

Capital allocation includes the $1.5 billion registered direct offering and concurrent private placement in August 2025, with net proceeds used to acquire WLFI tokens. The company paid placement fees of $32.546 million related to the equity financing. On January 29, 2026, the company drew down $15.0 million under the Master Loan and Security Agreement with WLFI, receiving net proceeds of approximately $14.2 million after prepayment of interest and reimbursement of lender expenses, with proceeds intended to fund a share repurchase program, acquire additional WLFI tokens, and for general corporate purposes. The company has not paid dividends on its common stock and does not presently plan to pay dividends for the foreseeable future.

Structural headwinds flagged by management include the highly volatile nature of crypto assets and the crypto economy, which causes operating results to fluctuate significantly from quarter to quarter. The company's total fintech revenue is substantially dependent on the volume of transactions conducted on its platform, and declines in crypto asset transaction volume could adversely affect business. The company faces intense competition from larger crypto platforms such as Coinbase, Kraken, Binance, and others, as well as decentralized exchanges and traditional financial institutions entering the digital asset space. The company has identified material weaknesses in internal control over financial reporting, including insufficient information technology general controls, inadequate control design over significant accounting processes, insufficient assessment of potentially significant transactions, and insufficient processes for proper recordkeeping of agreements and contracts.

Regulatory and macro factors identified as constraints include the extensive, highly-evolving, and uncertain regulatory landscape governing crypto assets, with the potential classification of certain crypto assets as securities by the SEC or other regulators potentially requiring significant restructuring. The company is subject to ongoing examinations and oversight by U.S. federal and state regulators and foreign financial service regulators. Banking and financial institution relationships may be disrupted, as banking institutions have in the past and may in the future limit, restrict, or terminate their relationships with crypto companies. The company operates subsidiaries in multiple foreign jurisdictions including Lithuania, the Czech Republic, Canada, and Saint Vincent and the Grenadines, exposing it to political, regulatory, legal, and currency risks.

Risk Factors

The company faces material risk from the highly volatile nature of crypto assets, with an unrealized loss on cryptocurrency assets of $402.054 million recorded in fiscal 2025 to mark WLFI tokens to fair value. The company's total fintech revenue is substantially dependent on transaction volume on its platform, and declines in crypto asset trading activity could adversely affect business. The company has identified material weaknesses in internal control over financial reporting, including insufficient information technology general controls, inadequate control design over significant accounting processes, insufficient assessment of potentially significant transactions, and insufficient processes for proper recordkeeping of agreements and contracts. The company has a working capital deficit of approximately $21.9 million as of December 27, 2025, with total current liabilities of $51.4 million compared to total current assets of $29.5 million , raising substantial doubt about its ability to continue as a going concern. The potential classification of certain crypto assets as securities by the SEC could materially impact business operations and require significant restructuring, and the company is subject to extensive anti-money laundering, counter-terrorism financing, know-your-customer, and economic sanctions obligations, with failure to comply potentially subjecting the company to significant penalties.

Management Priorities

Management's message emphasizes the company's transformation through the acquisition of ALT5 Sigma, Inc. and Mswipe, and the strategic WLFI Treasury Strategy initiated in August 2025. The company changed its corporate name from JanOne Inc. to ALT5 Sigma Corporation on July 15, 2024, and its Nasdaq ticker symbol from JAN to ALTS. Management has announced its intent to formally separate its Biotechnology segment (Alyea Therapeutics Corporation) into a separate company, though no decision has been made as to how the separation will be effectuated. The company's policy remains a committed long-term approach to its WLFI holdings, with future acquisitions funded through operating cash flows, structured debt, and selective capital raises. Management acknowledges that the company continues to face a challenging competitive environment and is focused on overall profitability, including managing expenses. The company reported a net loss from continuing operations of approximately $341.5 million for fiscal 2025 and has a working capital deficit of approximately $21.9 million , which raises substantial doubt about the company's ability to continue as a going concern within one year after the date the financial statements are issued.

View Source Annual Report on SEC.gov ↗

References

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  37. [37] Item 8, Note 3 — Mergers and Acquisitions (Mswipe)
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  108. [108] Item 7, MD&A — Results of Operations by Segment
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Analysis on 6/21/2026