BTCS Inc.

Ethereum Infrastructure Services Verification Node Operation: As an important verification node operator in the Ethereum network, BTC S participates in the consensus mechanism by staking ETH, maintaining network security and earning block rewards. As of Q2 2025, its verification nodes handle 2.7% of the transaction volume on the Ethereum network and have established a direct order flow partnership with MetaMask. Block Building Service (Builder+): The self-developed block building algorithm optimizes transaction packaging efficiency, with a market share reaching 2.7% by Q2 2025, primarily serving high-frequency trading institutions and DeFi protocols. Staking service platform: provides users with a staking channel for ETH, charging a management fee of 0.5% - 1%. By Q2 2025, the total amount of ETH staked reached 14,842 coins, of which 4,160 coins were staked through the Rocket Pool protocol, and 6,300 coins were staked through independent nodes. On-chain data and technological innovation AI-driven data analysis platform ChainQ: Integrating multi-chain data such as Ethereum and BNB Chain, providing transaction tracing, risk assessment, and tax optimization services for DeFi projects, with the number of paid enterprise clients increasing to 127 by Q2 2025. Layer 2 ecological layout: Collaborating with Arbitrum and Optimism to develop cross-chain data bridging tools, planning to connect 10 mainstream Layer 2 networks by the end of 2025. Cryptocurrency Asset Reserve Strategy Systematic increase in holdings of ETH: Through hybrid financing methods such as convertible bonds and DeFi lending, as of July 11, 2025, a total of 29,122 ETH has been accumulated, accounting for over 90% of the company's total assets. Staking yield reinvestment: Use the yield generated from staking ETH (annualized 3-5%) to purchase more ETH, creating a positive cycle of "staking - appreciation - re-staking."

Infrastructure service revenue (accounting for 45%) Node operation and staking management fees: In Q2 2025, revenue reached $760,500, a year-on-year increase of 189%, mainly from customized staking solutions for enterprise clients. Block construction service fee: Based on a transaction fee sharing model, revenue in Q2 2025 is $483,200, with an increase in market share driving a quarter-on-quarter revenue growth of 42%. Cryptocurrency asset appreciation income (accounting for 35%) ETH price fluctuation gains: In Q2 2025, due to the ETH price rising from $2,800 to $3,000, the fair value change gain reached $1.72 million, but in Q1, there was a net loss of $17.26 million due to a price drop. Staking rewards reinvestment: In Q2 2025, approximately 350 ETH rewards were obtained through staking. Data services and financing revenue (accounting for 20%) ChainQ platform subscription revenue: Q2 2025 revenue of $345,200, with clients including stablecoin issuers such as Circle and Paxos. DeFi lending spread: Borrow USDC at an annual interest rate of 2.78% through the Aave protocol to purchase ETH, then stake ETH to earn an annual yield of 3-5%, netting a profit spread of approximately $120,000 by Q2 2025.

Risk Diversification and Yield Enhancement Infrastructure revenue ( 45% ) provides stable cash flow, reducing the impact of ETH price fluctuations on profits. In Q2 2025, despite the severe volatility in ETH prices, service revenue grew 189% year-on-year, demonstrating business resilience. The staking yield reinvestment strategy allows the ETH holdings to grow by more than 30% quarter-on-quarter, creating a dual return of "time compounding + price compounding." Building a Technical Moat The verification nodes and block construction technology create barriers, and by Q2 2025, it will surpass competitors like Prysmatic Labs in the Ethereum block construction market share, rising to the top ten in the industry. The AI analysis capabilities of the ChainQ platform help clients optimize their trading strategies, with a customer retention rate of 92% in Q2 2025, significantly higher than the industry average. Strategic Reserve Value Holding 29,122 ETH (accounting for 0.015% of the circulating supply) makes it an important stakeholder in the Ethereum ecosystem, allowing for priority participation in protocol upgrade voting and ecological collaborations. If the price of ETH breaks through $10,000 in 2027, the value of BTC S holdings will reach $290 million, with the market value expected to grow 5-8 times.

Direct impact Ethereum ( ETH ): Demand side: The continuous purchasing behavior of BTC S increases market demand, with a cumulative increase of 14,522 ETH in Q2 2025, accounting for 7.3% of the net issuance of Ethereum on-chain during the same period. Supply side: 14,842 ETH staked (accounting for 51% of the holdings) is locked in the consensus mechanism, reducing the circulating supply and indirectly supporting the coin price. Platform tokens (potentially to be issued in the future): If BTC S launches a governance token, it may be exchanged through staking ETH, further binding users to ecological interests. Indirect influence Stablecoins (USDC/USDT): As the main medium for DeFi lending, in Q2 2025, $15.5 million USDC was borrowed through the Aave protocol, increasing its market circulation. Other Layer 2 tokens (ARB/OP): BTC S plans to integrate with Arbitrum and Optimism, potentially earning returns through staking Layer 2 tokens, which may indirectly affect its supply and demand relationship.