Core Viewpoint - Empery Digital Inc. has received nomination notices from ATG Capital Management and Tice P. Brown for director positions at the upcoming 2026 Annual Meeting of Stockholders, with the company emphasizing its commitment to shareholder value and its ongoing share repurchase strategy [1][2]. Group 1: Nomination Notices - Empery Digital confirmed receipt of two nomination notices from ATG Capital and Tice P. Brown for director nominations at the 2026 Annual Meeting [1]. - The date for the Annual Meeting has not yet been announced, and shareholders are not required to take any action at this time [1]. Group 2: Company Strategy and Performance - Empery Digital has undergone a transformation to operate a low-cost, capital-efficient, and transparent bitcoin treasury, with a focus on increasing Bitcoin per share [1]. - The company has implemented the largest share repurchase program in the digital asset treasury sector, resulting in a 40% reduction in the NAV gap and a nearly 3% increase in Bitcoin per share since January 29, 2026 [1]. - Since the last Bitcoin purchase on August 27, 2025, there has been a 39% increase in Bitcoin per share [1]. Group 3: Engagement with Shareholders - Empery Digital has attempted to engage constructively with ATG Capital and Mr. Brown but has faced refusal from ATG and personal attacks from Mr. Brown [1]. - The company believes that ATG Capital's attempts to take control are not in the best interests of all shareholders, as they have not engaged with any company director or executive [1]. Group 4: Management and Board Structure - Empery Digital's management team has deep capital markets and asset management expertise, and the Board is independent and experienced in digital assets and regulatory environments [1]. - The management compensation is structured to align with shareholder interests, and the Board has committed to not adjusting option strike prices or issuing additional options [1].

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $577.9 million, up 13.3% year over year but down 46.2% sequentially [36] - Gross crypto services revenue for the quarter was $568.1 million, up 14.3% year over year and down 46.7% sequentially [36] - Net loss for the quarter was $30.2 million, improving 15.1% year over year from a loss of $35.5 million [38] Business Line Data and Key Metrics Changes - Crypto trading volumes for Q2 experienced a decline, with total notional volume at $733 million, comprised of $565 million from crypto trading and $168 million from loyalty redemptions [34] - Total active transacting accounts were 689,000, segmented into 265,000 loyalty redemption accounts and 424,000 crypto trading accounts [33] - Net loyalty revenues were $9.8 million, down 23.3% year over year but up 6.8% sequentially [36] Market Data and Key Metrics Changes - The crypto market faced headwinds from March through June due to regulatory uncertainty and macroeconomic pressures [32] - Since the end of Q2, Bitcoin trading volume improved by 50% month over month following new all-time highs in July [33] - The regulatory environment is becoming more supportive, with the current administration showing bullishness towards digital assets [32] Company Strategy and Development Direction - The company is strategically realigning into a pure play crypto infrastructure company, divesting non-core businesses to focus on crypto [6][9] - A partnership with Distributed Technologies Research (DTR) aims to enhance stablecoin payment infrastructure [6][10] - The company plans to roll out a comprehensive set of technology upgrades to enhance user experience and expand trading capabilities [15][19] Management's Comments on Operating Environment and Future Outlook - Management believes the company is well-positioned to capitalize on the digitalization of real-world assets and the growing trend of institutional adoption of digital assets [6][31] - The CEO transition is expected to further strengthen the company's focus on crypto infrastructure and growth [12][31] - Management expressed optimism about the future, citing a favorable policy backdrop and the potential for significant market growth [33] Other Important Information - The company completed the sale of its trust business to Intercontinental Exchange (ICE) and is in the process of divesting its loyalty business [9][10] - A successful $75 million capital raise was completed, significantly recapitalizing the balance sheet [11][40] - The company is focusing on expanding its Bitcoin treasury strategy, starting with Japan [26][27] Q&A Session Summary Question: What are the expectations for the stablecoin payments market? - Management highlighted the partnership with DTR as a key driver for entering the stablecoin payments market, aiming to deliver programmable solutions for cross-border value transfers [6][10] Question: How is the company addressing the decline in trading volumes? - Management noted that the decline was aligned with broader market trends but expressed optimism about recent improvements in trading volumes and onboarding new institutional clients [32][33] Question: What are the key priorities moving forward? - Key priorities include finalizing the sale of the loyalty business, rolling out technology upgrades, and expanding the Bitcoin treasury strategy [28][29]

Financial Performance - Total revenues were $577.9 million, a 13.3% year-over-year increase, but down 46.2% quarter-over-quarter due to market conditions[45, 58] - Crypto services revenue was $568.1 million[45, 69] - Loyalty services revenue was $9.8 million, down 23.3% year-over-year but up 6.8% quarter-over-quarter[46, 69] - Total operating expenses were $596.4 million, up 12.1% year-over-year and down 45.5% quarter-over-quarter[54, 58] - Adjusted EBITDA loss was $12.6 million, improved 29.9% year-over-year[62, 63] Key Metrics - Crypto trading volume increased 14% year-over-year and 69% since Q2 2023[36] - Quarterly notional crypto traded volume reached $565 million in Q2 2025[39, 42] - Assets under custody were $1,355 million[44] Strategic Initiatives - Bakkt is realigning as a pure-play crypto infrastructure company, including the divestiture of non-core assets like the Custody business[10] - The company is focusing on three pillars: Brokerage-in-a-box, Stablecoin Payments, and Bitcoin treasury strategy[11, 12] - Bakkt initiated a Bitcoin treasury strategy with a 30% ownership stake in MarushoHotta Co (MHT), rebranding it to bitcoin.jp[26, 27, 30]