Ip Strategy Holdings (IPST) FY2025 10-K Risk Factors: 49 New, 20 Dropped

What the changes say

The company has shifted its primary business focus toward crypto assets, specifically accumulating $IP Tokens and running validator operations.
Financial results and stock price are now heavily exposed to extreme volatility in the cryptocurrency market.
Net operating loss carryforwards are subject to strict annual limitations under Section 382 following equity issuances.

What changed since the prior 10-K

New

NewRisks Related to Our Financial Position and Capital Needs
We have a history of losses and our profitability may be subject to large swings in the future due to changes in the value of the $IP Tokens we own based on their value in the market
Our profitability experiences massive swings driven by the fair value changes of our holdings in $IP Tokens, resulting in substantial net losses like $133,944,431 in 2025.
NewRisks Related to Our Financial Position and Capital Needs
Our historical financial statements for the year ended December 31, 2024 do not reflect the potential variability in earnings that we experienced in the year ended December 31, 2025 or may experience in the future from holding or selling significant amounts of $IP Tokens
The price of $IP Tokens is highly volatile, ranging from $0.516 to $14.908 between February 2025 and March 2026, creating severe earnings unpredictability under ASU 2023-08.
NewRisks Related to Our Financial Position and Capital Needs
For many reasons, including those described below, our operating results, revenues, and expenses may vary significantly in the future from quarter to quarter. These fluctuations could have an adverse effect on the market price of our listed securities
Our quarterly operating results and stock price fluctuate significantly due to changes in $IP Token market prices, potential crypto sales, and related tax liabilities.
NewRisks Related to Our Financial Position and Capital Needs
A substantial portion of the total number of $IP Tokens initially created has been, and will continue to be, released into circulation, which may create significant downward pressure on the market price of $IP Tokens, which, in turn could adversely affect our revenues and liquidity position
Approximately 352 million $IP Tokens are in circulation out of one billion initially created, and monthly token unlocks over up to four years may depress market prices.
NewRisks Related to Our Financial Position and Capital Needs
new $IP Tokens into circulation, resulting in a net increase of approximately 25.5 million $IP Tokens since inception (net of token burns). As of March 31, 2026, approximately 352 million $IP Tokens were in circulation
Decreases in the $IP Token price reduce the dollar value of our validator rewards, directly harming our revenue and profitability despite stable participation.
NewRisks Related to Our Financial Position and Capital Needs
Risks associated with our net operating loss (“NOL”) carryforwards, tax liabilities and fluctuations between reporting periods could adversely affect our results of operations and financing costs and the market price of our common stock
We recorded a deferred income tax asset with a full valuation allowance against NOL carryforwards, while a price drop in $IP Tokens to $1.72 triggered a $118.2 million digital asset loss.
NewRisks Related to Our Financial Position and Capital Needs
ownership change, which is typically defined as a cumulative shift of more than 50 percentage points in ownership by certain shareholders over a rolling three-year period
Our ability to use $74.8 million in federal NOL carryforwards is limited annually under Section 382 due to ownership shifts from our November 2024 IPO and August 2025 prepaid warrant private placement.
NewRisks Related to Our Financial Position and Capital Needs
Certain previous sales made under our now closed equity line of credit may adversely affect our business, market perception and stock price
Between July 21 and July 30, 2025, we sold 427,526 shares under our ELOC Purchase Agreement for $3,396,161 while simultaneously conducting a private placement.
NewRisks Related to Our Business Operations
Global conflicts and geopolitical tensions could increase cybersecurity risks and disrupt our operations, which could adversely affect our business, financial condition and results of operations
Global conflicts involving Ukraine, Russia, China, Taiwan, and the Middle East increase the threat of cyberattacks, ransomware, and digital asset theft.
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
In relation to our acquisition, accumulation, holding, storing, selling, transferring or otherwise using any cryptocurrencies, there is a risk that rules or regulations could change, impacting the value of any such cryptocurrencies we hold and our ability to continue to use them or how we recognize, use and value them
Unclear application of state and federal securities laws to cryptocurrencies could lead to regulations classifying $IP Tokens as securities, adversely impacting our stock.
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Declines in the broader cryptocurrency market could adversely affect the $IP Token, our business and the value of our digital assets
Broad declines in the broader cryptocurrency market could reduce demand for our offerings, impair capital raising, and cause non-cash write-downs of digital assets.
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
customer activity, impair our ability to raise capital, and lead to write-downs or other non-cash charges, any of which could negatively impact our business and operating results and the trading price of our common stock
In August 2025, we acquired over 53 million $IP Tokens for treasury operations, which do not pay interest and rely entirely on token appreciation for investment returns.
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We have engaged, and plan to continue to engage, in derivatives transactions, including for the purpose of generating yield by the sale of covered call options on our $IP Tokens, and such transactions may expose us to material risks that could adversely impact our business, operating results and financial condition
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Our common stock may trade at a substantial premium or discount to the value of the $IP Tokens we hold, and our stock price may be more volatile than the price of $IP Tokens
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
$IP Tokens and other digital assets are novel assets and are subject to significant legal, commercial, tax, regulatory and technical uncertainty, which could materially adversely affect our financial position, operations and prospects
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Our shift towards an $IP-focused strategy requires substantial changes in our day-to-day operations and exposes us to significant operational risks
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We plan to purchase additional digital assets using primarily proceeds from equity and debt financings, but we may be unable to obtain such financings on favorable terms
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
In connection with our focus on $IP Tokens, we expect to interact with various smart contracts deployed on the Story Network, which may expose us to risks and technical vulnerabilities
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Transactions using $IP Tokens or on the Story Network require the payment of “gas fees,” which are subject to fluctuations that may result in high transaction fees
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Changes in regulatory interpretations could require us to register as a money services business or money transmitter, leading to increased compliance costs or operational shutdowns
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
to cease certain operations in response to new regulatory obligations, such actions could occur at a time that is unfavorable to investors
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
There is a possibility that $IP Tokens may be classified as a “security.” If $IP Tokens are classified as a “security,” that would subject us to additional regulation and could materially impact the operations of our treasury strategy and our business
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The SEC-CFTC Memorandum of Understanding dated March 11, 2026 establishes a framework for heightened interagency coordination on crypto asset regulation and enforcement that could materially affect the regulatory treatment of $IP Tokens and our treasury strategy
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
If we were deemed to be an investment company under the Investment Company Act, applicable restrictions likely would make it impractical for us to continue segments of our business as currently contemplated
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The availability of spot exchange-traded products (“ETPs”) for digital assets may adversely affect the market price of our listed securities
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Ethereum and other digital assets. The listing and trading of spot ETPs for digital assets offers investors another alternative to gain exposure to digital assets, which could result in a decline in the price of our listed securities relative to the value of our digital assets
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We are not subject to legal and regulatory obligations that apply to investment companies such as mutual funds and exchange-traded funds, or to obligations applicable to investment advisers
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We may be deemed to be a “commodity pool” under CEA and CFTC Rules as a result of our commodity interest trading, which could have a material adverse effect on our business, financial condition and results of operations
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Digital asset holdings are less liquid than cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Transacting in digital assets exposes us to counterparty credit risk
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Cybersecurity risks associated with digital assets and decentralized protocols could result in significant losses
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Intellectual property disputes related to the open-source structure of digital asset networks exposes us to risks related to software development, security vulnerabilities and potential disruptions to digital asset technology could threaten our ability to operate
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The lack of legal recourse and insurance for digital assets increases the risk of total loss in the event of theft or destruction
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We face risks relating to the custody of our digital assets, including the loss or destruction of private keys required to access our digital assets and cyberattacks or other data loss relating to our digital assets, including smart contract related losses and vulnerabilities
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The use of digital asset custodians could expose us to additional risks related to custodian insolvency, as well as cybersecurity and concentration risk
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The irreversibility of digital asset transactions exposes us to risks of theft, loss and human error, which could negatively impact our business
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Although we plan to regularly transfer digital assets to or from vendors, consultants and services providers, it is possible that, through computer or human error, or through theft or criminal action, such assets could be transferred in incorrect amounts or to unauthorized third parties
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We are subject to significant competition in the growing digital asset industry and our business, operating results, and financial condition may be adversely affected if we are unable to compete effectively
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
As a result of our $IP Tokens strategy, we expect our assets to be concentrated in $IP Tokens holdings. Accordingly, the emergence or growth of digital assets other than $IP Tokens may have a material adverse effect on our financial condition
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We may be subject to risks associated with the provision and use of validator services
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Complex valuation controls and benchmark dependence may lead to restatements or control deficiencies
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
The Story Network is a relatively new protocol and could be subject to risks inherent in new technologies
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
Because of the pseudonymous nature of blockchain transactions, we may inadvertently and without knowledge, directly or indirectly engage in transactions with or for the benefit of prohibited persons under U.S. or foreign sanctions laws
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
addition, we may be subject to non-U.S. economic sanctions laws and regulations to the extent we conduct activity within the jurisdiction of other sanctions regimes, including those of the European Union and United Kingdom
NewRisks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens
We may be subject to securities or corporate governance litigation, which is expensive and could divert our management’s attention
NewRisks Related to Our Craft Spirits Business
We could see structural changes in the amount of alcohol purchased and consumed in our markets as the use of GLP-1 and similar weight loss drugs increase among the population, which could create more pricing competition or an overall reduction in sales and revenues associated with alcohol
NewRisks Related to Our Craft Spirits Business
The equipment our third party producers use to make our products may not perform as planned or designed
NewRisks Related to Our Craft Spirits Business
personalities who may be viewed as controversial attempt to align themselves with our company or our brands that causes a backlash among consumers
NewRisks Related to Ownership of Our Common Stock
Investors could experience a reduction in share price for our common stock they own, or dilution resulting from the exercise of warrants into common stock or the conversion of preferred stock into common stock, or the vesting and settlement of equity grants to employees, directors and consultants

Dropped

DroppedRisks Related to Our Financial Position and Capital Needs
We have a history of losses, anticipate increasing our operating expenses in the future and may not achieve or maintain profitability in the future
History of operating losses and uncertainty of achieving future profitability.
DroppedRisks Related to Our Financial Position and Capital Needs
As we have incurred recurring operating losses and negative cash flows from operations since our inception, there is no assurance that we will be able to continue as a going concern absent additional financing, which we may not be able to obtain on favorable terms, or at all
Uncertainty of continuing as a going concern absent additional financing.
DroppedRisks Related to Our Financial Position and Capital Needs
Our future capital needs are uncertain, and we may need to raise additional funds to support those needs
Uncertain future capital needs and reliance on an ELOC and Series B Preferred Stock.
DroppedRisks Related to Our Financial Position and Capital Needs
We may continue to have limited capital depending on our ability to raise additional equity or debt financing, how our funds are managed and how well our products and services continue to be received in the marketplace
Limited capital depending on ability to raise equity or debt financing.
DroppedRisks Related to Our Financial Position and Capital Needs
Our senior secured lender may accelerate our indebtedness and foreclose on our assets
Risk that our senior secured lender could accelerate indebtedness and foreclose on assets.
DroppedRisks Related to Our Financial Position and Capital Needs
Higher interest rates could adversely affect our ability to obtain debt financing and our operating results
DroppedRisks Related to Our Financial Position and Capital Needs
We could be materially adversely affected by health concerns such as, or similar to, the COVID-19 pandemic, food-borne illnesses, and negative publicity regarding food quality, illness, injury or other health concerns
Higher interest rates increasing the cost of debt financing and operations.
DroppedRisks Related to Our Financial Position and Capital Needs
We may be subject to litigation from vendors for unpaid invoices, which could materially affect our business, results of operations, financial condition or liquidity
DroppedRisks Related to Our Business Model
The equipment we use and intend to purchase in the future to make our products or offer our services may not perform as planned or designed
Adverse effects from health concerns such as COVID-19 and food-borne illnesses.
DroppedRisks Related to Our Business Model
Temperature issues in fermentation vessels, bacteria or other contamination could negatively affect the fermentation process for our products
Potential litigation from vendors for unpaid invoices and overdue accounts payable.
DroppedRisks Related to Our Business Model
Certain former Thinking Tree Spirits shareholders opposed our acquisition of that company and filed a notice exercising dissenters’ rights. Two of the dissenters claims have been resolved and we are awaiting final resolution of the third
DroppedRisks Related to Our Business Model
executives, directors, or prominent shareholders, does or says something to cause harm to the co-branded product and our brand by association
DroppedRisks Related to Our Business Model
We may be subject to claims for personal injuries at our facilities
DroppedRisks Related to Our Business Model
There is a risk that we adopt a Bitcoin Treasury Policy that guides the acceptance, acquisition, handling, storage, use and disposition of bitcoin and other cryptocurrencies, which could create a number of risks for us and our stockholders
DroppedRisks Related to Our Business Model
Global conflicts could increase our costs, which could adversely affect our operations and financial condition
DroppedRisks Related to Regulation
fines, or cause us to change our practices or arrangements, which could have a material adverse effect on us or our revenues and profitability
DroppedRisks Related to Regulation
We are subject to state-specific regulatory risks related to our location in Eugene, Oregon
DroppedRisks Related to Regulation
In the event we begin to acquire, accumulate, hold, store, sell, transfer or otherwise use any cryptocurrencies, there is a risk that rules or regulations could change, impacting the value of any such crypto currencies we hold and our ability to continue to use them or how we recognize, use and value them
DroppedRisks Related to Ownership of Our Common Stock
fluctuations, as well as general economic, political and market conditions such as recessions, interest rate changes or international currency fluctuations, may negatively impact the market price of our common stock You may not realize any return on your investment in us and may lose some or all of your investment
DroppedRisks Related to Ownership of Our Common Stock
not eligible, Nasdaq will provide notice that our common stock will be subject to delisting from the Nasdaq Capital Market. At that time, we may appeal any such delisting determination to a Nasdaq hearings panel

Reworded

87% rewrittenRisks Related to Our Business Operations
If we are unable to retain key executives and other key affiliates, our growth could be significantly inhibited and our business harmed with a material adverse effect on our business, financial condition and results of operations
Removed a specific reference to maintaining key-person insurance exclusively for CEO Justin Stiefel and President Jennifer Stiefel.
84% rewrittenRisks Related to Ownership of Our Common Stock
Our failure to meet the continued listing requirements of the Nasdaq could result in de-listing of our common stock
Added specifics about receiving a Nasdaq deficiency notice in April 2025 for a bid price below $1.00 and regaining compliance via a November 2025 reverse stock split.
84% rewrittenRisks Related to Our Business Operations
Our strategy may include acquiring companies or brands, which may result in unsuitable acquisitions or failure to successfully integrate acquired companies or brands, which could lead to reduced profitability
Removed the specific mention of the Thinking Tree Spirits acquisition as an example of past growth strategy.
82% rewrittenRisks Related to Our Craft Spirits Business
Contamination of our products and/or counterfeit or confusingly similar products could harm the image and integrity of, or decrease customer support for, our brands and decrease our sales
Minor phrasing adjustments without altering core contamination and counterfeit product risks.
76% rewrittenRisks Related to Our Craft Spirits Business
Adverse public opinion about alcohol could reduce demand for our products
Removed a sentence regarding heavy reliance on the three-tier alcohol distribution system.
63% rewrittenRisks Related to Ownership of Our Common Stock
The market price of our common stock may be highly volatile, and you could lose all or part of your investment
Replaced IPO-specific pricing disclosures with broader commentary on market volatility and low daily trading volume for small companies.
61% rewrittenRisks Related to Regulation
Our regulatory licenses may be suspended or revoked, or we may fail to secure or retain required permits or licenses
Removed a specific example regarding providing alcohol samples to minors at tasting rooms leading to fines or license suspension.
52% rewrittenRisks Related to Our Craft Spirits Business
The AI tools we may come to rely upon may create third-party liability for our company
Retained identical risk text regarding third-party liability and intellectual property infringement risks from using AI tools.
42% rewrittenRisks Related to Our Craft Spirits Business
An interruption of our operations or a catastrophic event at the facilities of any of our third-party producers or any significant supplier could negatively affect our business
Was: An interruption of our operations or a catastrophic event at our facilities or the facilities of a partner or supplier could negatively affect our business
42% rewrittenRisks Related to Regulation
We are subject to extensive government regulation and are required to obtain and renew various permits and licenses; changes in or violations of laws or regulations or failure to obtain or renew permits and licenses could materially adversely affect our business and profitability
40% rewrittenRisks Related to Ownership of Our Common Stock
We do not anticipate paying any cash dividends on our common stock in the foreseeable future and, as such, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future
40% rewrittenRisks Related to Our Craft Spirits Business
We are subject to seasonality related to sales of our products
20% rewrittenRisks Related to Ownership of Our Common Stock
Anti-takeover provisions in our charter documents and under Delaware law could make the acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management and limit the market price of our common stock
20% rewrittenRisks Related to Our Craft Spirits Business
Climate change, or legal, regulatory or market measures to address climate change, may negatively affect our spirits business, operations or financial performance, and water scarcity or poor quality could negatively impact our production costs and capacity
Was: Climate change, or legal, regulatory or market measures to address climate change, may negatively affect our business, operations or financial performance, and water scarcity or poor quality could negatively impact our production costs and capacity

All 123 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Financial Position and Capital Needs

01We have a history of losses and our profitability may be subject to large swings in the future due to changes in the value of the $IP Tokens we own based on their value in the marketNew
02Our historical financial statements for the year ended December 31, 2024 do not reflect the potential variability in earnings that we experienced in the year ended December 31, 2025 or may experience in the future from holding or selling significant amounts of $IP TokensNew
03For many reasons, including those described below, our operating results, revenues, and expenses may vary significantly in the future from quarter to quarter. These fluctuations could have an adverse effect on the market price of our listed securitiesNew
04A substantial portion of the total number of $IP Tokens initially created has been, and will continue to be, released into circulation, which may create significant downward pressure on the market price of $IP Tokens, which, in turn could adversely affect our revenues and liquidity positionNew
05new $IP Tokens into circulation, resulting in a net increase of approximately 25.5 million $IP Tokens since inception (net of token burns). As of March 31, 2026, approximately 352 million $IP Tokens were in circulationNew
06Risks associated with our net operating loss (“NOL”) carryforwards, tax liabilities and fluctuations between reporting periods could adversely affect our results of operations and financing costs and the market price of our common stockNew
07ownership change, which is typically defined as a cumulative shift of more than 50 percentage points in ownership by certain shareholders over a rolling three-year periodNew
08Sustained or increasing inflation could adversely impact our operations and our financial condition
09Small Business Association (“SBA”) Paycheck Protection Program (“PPP”) loan repayment risk and timing
10Certain previous sales made under our now closed equity line of credit may adversely affect our business, market perception and stock priceNew
11Our failure to maintain an effective system of internal control over financial reporting could adversely affect our ability to present accurately our financial statements and could materially and adversely affect us, including our business, reputation, results of operations, financial condition or liquidity

Risks Related to Our Business Operations

12Our management team may not be able to successfully implement our business strategies
13If we are unable to retain key executives and other key affiliates, our growth could be significantly inhibited and our business harmed with a material adverse effect on our business, financial condition and results of operations87% rewritten
14Our strategy may include acquiring companies or brands, which may result in unsuitable acquisitions or failure to successfully integrate acquired companies or brands, which could lead to reduced profitability84% rewritten
15A failure of one or more of our key IT systems, networks, processes, associated sites or service providers could have a material adverse impact on our business operations, and if the failure is prolonged, our financial condition
16Global conflicts and geopolitical tensions could increase cybersecurity risks and disrupt our operations, which could adversely affect our business, financial condition and results of operationsNew

Risks Related to Our Cryptocurrency Treasury Reserve Strategy and $IP Tokens

17In relation to our acquisition, accumulation, holding, storing, selling, transferring or otherwise using any cryptocurrencies, there is a risk that rules or regulations could change, impacting the value of any such cryptocurrencies we hold and our ability to continue to use them or how we recognize, use and value themNew
18Declines in the broader cryptocurrency market could adversely affect the $IP Token, our business and the value of our digital assetsNew
19customer activity, impair our ability to raise capital, and lead to write-downs or other non-cash charges, any of which could negatively impact our business and operating results and the trading price of our common stockNew
20We have engaged, and plan to continue to engage, in derivatives transactions, including for the purpose of generating yield by the sale of covered call options on our $IP Tokens, and such transactions may expose us to material risks that could adversely impact our business, operating results and financial conditionNew
21Our common stock may trade at a substantial premium or discount to the value of the $IP Tokens we hold, and our stock price may be more volatile than the price of $IP TokensNew
22$IP Tokens and other digital assets are novel assets and are subject to significant legal, commercial, tax, regulatory and technical uncertainty, which could materially adversely affect our financial position, operations and prospectsNew
23Our shift towards an $IP-focused strategy requires substantial changes in our day-to-day operations and exposes us to significant operational risksNew
24We plan to purchase additional digital assets using primarily proceeds from equity and debt financings, but we may be unable to obtain such financings on favorable termsNew
25In connection with our focus on $IP Tokens, we expect to interact with various smart contracts deployed on the Story Network, which may expose us to risks and technical vulnerabilitiesNew
26Transactions using $IP Tokens or on the Story Network require the payment of “gas fees,” which are subject to fluctuations that may result in high transaction feesNew
27Changes in regulatory interpretations could require us to register as a money services business or money transmitter, leading to increased compliance costs or operational shutdownsNew
28to cease certain operations in response to new regulatory obligations, such actions could occur at a time that is unfavorable to investorsNew
29There is a possibility that $IP Tokens may be classified as a “security.” If $IP Tokens are classified as a “security,” that would subject us to additional regulation and could materially impact the operations of our treasury strategy and our businessNew
30The SEC-CFTC Memorandum of Understanding dated March 11, 2026 establishes a framework for heightened interagency coordination on crypto asset regulation and enforcement that could materially affect the regulatory treatment of $IP Tokens and our treasury strategyNew
31If we were deemed to be an investment company under the Investment Company Act, applicable restrictions likely would make it impractical for us to continue segments of our business as currently contemplatedNew
32The availability of spot exchange-traded products (“ETPs”) for digital assets may adversely affect the market price of our listed securitiesNew
33Ethereum and other digital assets. The listing and trading of spot ETPs for digital assets offers investors another alternative to gain exposure to digital assets, which could result in a decline in the price of our listed securities relative to the value of our digital assetsNew
34We are not subject to legal and regulatory obligations that apply to investment companies such as mutual funds and exchange-traded funds, or to obligations applicable to investment advisersNew
35We may be deemed to be a “commodity pool” under CEA and CFTC Rules as a result of our commodity interest trading, which could have a material adverse effect on our business, financial condition and results of operationsNew
36Digital asset holdings are less liquid than cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalentsNew
37Transacting in digital assets exposes us to counterparty credit riskNew
38Cybersecurity risks associated with digital assets and decentralized protocols could result in significant lossesNew
39Intellectual property disputes related to the open-source structure of digital asset networks exposes us to risks related to software development, security vulnerabilities and potential disruptions to digital asset technology could threaten our ability to operateNew
40The lack of legal recourse and insurance for digital assets increases the risk of total loss in the event of theft or destructionNew
41We face risks relating to the custody of our digital assets, including the loss or destruction of private keys required to access our digital assets and cyberattacks or other data loss relating to our digital assets, including smart contract related losses and vulnerabilitiesNew
42The use of digital asset custodians could expose us to additional risks related to custodian insolvency, as well as cybersecurity and concentration riskNew
43The irreversibility of digital asset transactions exposes us to risks of theft, loss and human error, which could negatively impact our businessNew
44Although we plan to regularly transfer digital assets to or from vendors, consultants and services providers, it is possible that, through computer or human error, or through theft or criminal action, such assets could be transferred in incorrect amounts or to unauthorized third partiesNew
45We are subject to significant competition in the growing digital asset industry and our business, operating results, and financial condition may be adversely affected if we are unable to compete effectivelyNew
46As a result of our $IP Tokens strategy, we expect our assets to be concentrated in $IP Tokens holdings. Accordingly, the emergence or growth of digital assets other than $IP Tokens may have a material adverse effect on our financial conditionNew
47We may be subject to risks associated with the provision and use of validator servicesNew
48Complex valuation controls and benchmark dependence may lead to restatements or control deficienciesNew
49The Story Network is a relatively new protocol and could be subject to risks inherent in new technologiesNew
50Because of the pseudonymous nature of blockchain transactions, we may inadvertently and without knowledge, directly or indirectly engage in transactions with or for the benefit of prohibited persons under U.S. or foreign sanctions lawsNew
51addition, we may be subject to non-U.S. economic sanctions laws and regulations to the extent we conduct activity within the jurisdiction of other sanctions regimes, including those of the European Union and United KingdomNew
52We may be subject to securities or corporate governance litigation, which is expensive and could divert our management’s attentionNew

Risks Related to Our Craft Spirits Business

53We face significant competition with an increasing number of products and market participants that could materially and adversely affect our business, results of operations and financial results
54We compete in an industry that is brand-conscious, so brand name recognition and acceptance of our products are critical to our success
55A reduction in consumer demand for whiskey and other spirits, which may result from a variety of factors, including demographic shifts and decreases in discretionary spending, could materially and adversely affect our business, results of operations and financial results
56Adverse public opinion about alcohol could reduce demand for our products76% rewritten
57We could see structural changes in the amount of alcohol purchased and consumed in our markets as the use of GLP-1 and similar weight loss drugs increase among the population, which could create more pricing competition or an overall reduction in sales and revenues associated with alcoholNew
58Failure of third-party distributors upon which we rely could adversely affect our business
59We incur significant time and expense in attracting and maintaining key distributors
60It is difficult to predict the timing and amount of our sales because our distributors and their accounts are not required to place minimum orders with us
61The sales of our products could decrease significantly if we cannot secure and maintain listings in the control states
62The privatization of a control state could adversely impact our sales and our results of operations
63Substantial disruption at the distilleries and distribution facilities with which we contract or partner for our production or storage could occur
64Disruption within our supply chain, contract manufacturing or distribution channels could have an adverse effect on our business, financial condition and results of operations
65Our reliance on distributors, retailers and brokers, or our inability to expand the TBN, could affect our ability to efficiently and profitably distribute and market our products, maintain our existing markets and expand our business into other geographic markets
66Our TBN efforts may not be successful
67A non-profit or charitable partner could act in a way that damages our brand
68If we do not adequately manage our inventory levels, our operating results could be adversely affected
69We or our third-party producers may not be able to replicate the flavor profiles of our products
70There is a long lead time for the production of our products due to the aging process for spirits
71We have a minority ownership interest in another brand, the value of which may never be realized or monetized, or which could be significantly reduced or written down
72Some of our future earnings from any sale of FBLLC have been pledged as inducements to secure past financings, which could reduce or eliminate our receipt of gains from the future sale of FBLLC for the benefit of our company or our investors
73Our interest in FBLLC or any future brand or entity in which we invest could be subject to dilution if there is a capital call in which we do not participate
74An interruption of our operations or a catastrophic event at the facilities of any of our third-party producers or any significant supplier could negatively affect our business42% rewritten
75The formulas, recipes and proportions used in the production of our products may differ materially from those we have assumed for purposes of our business plan
76We may be disparaged publicly or in the press for not being authentically “craft.”
77We are subject to seasonality related to sales of our products40% rewritten
78If our inventory is lost due to theft, fire or other damage or becomes obsolete, our results of operations would be negatively impacted
79Weather conditions may have a material adverse effect on our sales or on the price of raw materials used to produce spirits
80Climate change, or legal, regulatory or market measures to address climate change, may negatively affect our spirits business, operations or financial performance, and water scarcity or poor quality could negatively impact our production costs and capacity20% rewritten
81The equipment our third party producers use to make our products may not perform as planned or designedNew
82We operate in highly-competitive industries, and competitive pressures could have a material adverse effect on our business
83Our failure to manage growth effectively or prepare for product scalability could have an adverse effect on our employee efficiency, product quality, working capital levels and results of operations
84We may not be successful in introducing new products and services
85Our success in the future may depend on our ability to establish and maintain strategic alliances, and any failure on our part to establish and maintain such relationships would adversely affect our market penetration and revenue growth
86From time to time, we may become subject to litigation specifically directed at the alcoholic beverage industry, as well as litigation arising in the ordinary course of business
87We may not be able to maintain our production, co-branded or co-packed spirits products or win any such agreements in the future
88We have affiliations with products associated with more established brands and celebrities
89We may be subject to vandalism or theft of our products or equipment
90We are testing the use of Artificial Intelligence (AI) in our marketing, branding and other efforts, which could create several risks for our operations
91The AI tools we may come to rely upon may create third-party liability for our company52% rewritten
92personalities who may be viewed as controversial attempt to align themselves with our company or our brands that causes a backlash among consumersNew
93Our failure to adequately maintain and protect the personal information of our customers or our employees in compliance with evolving legal requirements could have a material adverse effect on our business
94Contamination of our products and/or counterfeit or confusingly similar products could harm the image and integrity of, or decrease customer support for, our brands and decrease our sales82% rewritten

Risks Related to Our Intellectual Property

95It is difficult and costly to protect our proprietary rights
96We may face intellectual property infringement claims that could be time-consuming and costly to defend, and could result in our loss of significant rights and the assessment of treble damages
97We may be subject to claims by third parties asserting that our employees or we have misappropriated our intellectual property, or claiming ownership of what we regard as our own intellectual property

Risks Related to Regulation

98We are subject to extensive government regulation and are required to obtain and renew various permits and licenses; changes in or violations of laws or regulations or failure to obtain or renew permits and licenses could materially adversely affect our business and profitability42% rewritten
99Our industry may be subject to further demands to increase warnings on labels, specifically as it relates to cancer
100We are subject to regulatory overview by the Federal Alcohol and Tobacco Tax and Trade Bureau and state liquor control agencies
101Our regulatory licenses may be suspended or revoked, or we may fail to secure or retain required permits or licenses61% rewritten
102We are subject to various insurance and bonding requirements
103We are subject to certain record-keeping requirements to which we may not properly adhere
104We operate in a highly-regulated industry subject to state and federal regulation, and it is possible that state or federal legislative or regulatory bodies could change or amend laws that impact us
105The failure of Congress to pass federal spending bills could impact our ability to secure federal permits that are critical to our business and our growth plans
106We may become subject to audits by government agencies that find the mis-collection or mis-payment of taxes or fees
107Our products could be subject to a voluntary or involuntary recall
108Our agreements with partners may be perceived as de facto franchise relationships
109Direct to consumer shipping could become more regulated or be curtailed or terminated through government regulation or enforcement

Risks Related to Ownership of Our Common Stock

110The market price of our common stock may be highly volatile, and you could lose all or part of your investment63% rewritten
111Investors could experience a reduction in share price for our common stock they own, or dilution resulting from the exercise of warrants into common stock or the conversion of preferred stock into common stock, or the vesting and settlement of equity grants to employees, directors and consultantsNew
112We may be subject to securities litigation, which is expensive and could divert our management’s attention
113Our failure to meet the continued listing requirements of the Nasdaq could result in de-listing of our common stock84% rewritten
114If our shares become subject to the penny stock rules, it would become more difficult to trade our shares
115We could use shares of our common stock to acquire a position in, or all of, another company or brand, which could result in dilution for stockholders of record at that time
116We are an “emerging growth company” and the reduced disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors
117We incur significant costs from operating as a public company, and our management expects to devote substantial time to public company compliance programs
118Our management team has limited experience managing a public company
119Because we have elected to use the extended transition period for complying with new or revised accounting standards for an emerging growth company our financial statements may not be comparable to companies that comply with public company effective dates
120If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our common stock price and trading volume could decline
121Anti-takeover provisions in our charter documents and under Delaware law could make the acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management and limit the market price of our common stock20% rewritten
122Our Third Amended and Restated Certificate of Incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for certain litigation that may be initiated by our stockholders
123We do not anticipate paying any cash dividends on our common stock in the foreseeable future and, as such, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future40% rewritten

Other Ip Strategy Holdings 10-Ks

FY2024 10-K risk factors
94 risks
Company faces severe recurring operating losses, going concern doubts, and tight liquidity needing immediate capital in 2025.
Filed Apr 28, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.