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Operator: Greetings, and welcome to Hyperion DeFi’s Q3 ’25 Earnings Call. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Jason Assad. Thank you, Jason. You may begin.

Jason Assad: Good afternoon, and welcome to Hyperion DeFi’s 2025 Third Quarter Earnings Call. Joining me today are Interim CEO, Hyunsu Jung; and CFO, David Knox. Before we get started, please note that our remarks today may include forward-looking statements. These statements are subject to risks and uncertainties, and actual results may differ materially. During this call, we may use words like anticipate, could, enable, estimate, intend, expect, believe, potential, will, should, project and similar expressions, which indicate forward-looking statements. For a more comprehensive discussion of these and other risks, please refer to our filings with the SEC available on sec.gov and in the Investor Relations section of our website at hyperiondefi.com.

We’ll also reference certain non-GAAP financial measures today. Please refer to our earnings release and earnings supplement on our website for a full reconciliation of these non-GAAP measures to the most comparable GAAP measures. We will start this morning’s call with prepared remarks from Hyunsu and David, followed by Q&A. [Operator Instructions] I’ll now turn the call over to our Interim CEO, Hyunsu Jung.

Hyunsu Jung: Thank you, operator, and good afternoon, everyone. Welcome to Hyperion DeFi’s Third Quarter 2025 Earnings Call. Our first full quarterly earnings call since completing our strategic transformation from a biotech company to the first U.S. publicly listed digital asset treasury company focused on the Hyperliquid ecosystem. Now before I dive into our Q3 achievements, I want to acknowledge that this has been an extraordinary year for Hyperion DeFi. We successfully executed what I believe is one of the most significant corporate transformations in recent public market history, pivoting from Eyenovia’s ophthalmic technology focus to establishing ourselves as a premier institutional gateway to DeFi innovation. Today, Hyperion DeFi stands as the first U.S. public company building a strategic HYPE token treasury.

We’re not simply holding digital assets. We’re actively participating in the sustainable growth and governance of what we believe will become the backbone of next-generation financial services, the Hyperliquid blockchain. Our thesis is straightforward. Traditional finance is undergoing its most significant transformation since the advent of electronic trading. Hyperliquid represents the convergence of institutional-grade performance with decentralized innovation, offering up to 100,000 transactions per second with sub-second finality, all fully on chain. As institutions increasingly recognize the utility of blockchain adoption, we believe Hyperliquid’s infrastructure advantages position it to capture significant market share in not only the extensive derivatives market, but also as part of its larger role as a sustainable layer 1 blockchain ecosystem.

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Let me briefly outline why our conviction on Hyperliquid is so strong and why we decided to establish a digital asset treasury focused on HYPE, its native token. All information is as of October 31, 2025, and based on external resources. Hyperliquid is the #1 revenue-generating blockchain and #11 cryptocurrency by market cap, both figures excluding stablecoins. Hyperliquid generates annualized revenue of approximately $1.3 billion based on an October 2025 observed run rate of $3.5 million per day. Additionally, platforms built on Hyperliquid earn approximately $2 million in fees per day, bringing the total fees to approximately $5 million per day across the blockchain and platforms. Approximately 99% of Hyperliquid revenues are used by the Hyperliquid assistance fund, which has cumulatively purchased and owned 34.25 million HYPE tokens with a market value of approximately $1.45 billion.

There have been over 800,000 cumulative Hyperliquid marketplace users since inception. Hyperliquid’s token maximum supply is $1 billion, of which circulating supply is approximately $337 million and corresponds to a market capitalization of approximately $14.3 billion. Daily trading volume on Hyperliquid exceeds $12 billion, cumulative Hyperliquid fees have exceeded $700 million since inception and cumulative cryptocurrency perpetuals trading volume on Hyperliquid has exceeded $3 trillion since inception. With that in mind, what sets Hyperion DeFi apart from other digital asset treasury companies is our comprehensive ecosystem engagement strategy. While companies like MicroStrategy pioneered the corporate Bitcoin treasury model and others have followed with various token strategies, our approach with Hyperliquid goes far beyond simple accumulation.

The market opportunity we’re addressing continues to expand rapidly. Upcoming network upgrades, such as the recently announced HIP3 are expected to create new opportunities for users ranging from retail to institutions to participate in the ecosystem. For example, the requirement for 500,000 HYPE stake to launch new perpetual futures market has generated and is expected to continue to generate natural demand for large long-term token positions, which is exactly what we’ve worked to build through our strategic accumulation. Our competitive positioning is unique. As the first and largest public company focused on HYPE, we believe we have advantages in capital access, regulatory compliance and institutional credibility that will be difficult for competitors to replicate.

We also continue to develop what we expect to be long-term relationships with various participants in this space, ranging from protocols to major market makers and execution counterparties. One of our most significant Q3 achievements was launching our first HYPE Asset Use Service agreement with proprietary trading firm, Credo Payment. This innovative structure allows institutional clients to utilize our stake HYPE position to reduce their transaction costs on Hyperliquid while both parties share the resulting fee savings. This model demonstrates how our treasury position can create unique revenue opportunities that extend far beyond simple token appreciation. We’re essentially monetizing our stake in the network infrastructure while maintaining full ownership of our underlying assets, a business model that we believe has no equivalent in traditional finance.

Our vision extends beyond generating robust revenues on our treasury assets. We’re actively supporting the build-out of institutional infrastructure to bridge traditional finance and decentralized finance. The appointment of David Knox as our Chief Financial Officer exemplifies the strategy. David previously served as both Head of Capital Markets and Head of Finance for Global Credit and Financial Services at PayPal. He brings deep experience in scaling institutional financial product, and we believe his expertise in structured products and capital markets positions us to develop sophisticated financial services built on Hyperliquid’s infrastructure. It may be difficult to recognize now, but Hyperion DeFi is in the early phases of building out a unique strategy that we anticipate will benefit from a flywheel effect that circulates both on and off chain.

We’re not waiting for others to start this flywheel. We’re accelerating it day by day alongside other ecosystem builders, developing institutional-grade products and services that leverage Hyperliquid’s unique blockchain technology while meeting the regulatory and operational standards that traditional institutions require. Our financial strategy is designed to create long-term shareholder value through multiple pathways. First, direct exposure to HYPE token appreciation as we expect the Hyperliquid ecosystem to continue to grow and capture market share in decentralized derivatives. Second, we anticipate recurring revenue from our growing portfolio of DeFi services, including validation, asset use services and future product offerings. Third, the potential for strategic partnerships or acquisition opportunities as we expect traditional financial institutions to seek exposure to DeFi infrastructure.

And fourth, optionality around our legacy assets, including the potential for UFD monetization through strategic partnerships. I want to provide a quick rundown of our 6 business activities in Q3. Number one, staking rewards. This starts with our Kinetiq x Hyperion Validator. The company stakes its HYPE to its Validator and earns HYPE rewards. Number two, Validator commissions. The company operates its Validator under a Joint Validator Operators Agreement together with Kinetiq and Pier Two, earns commissions on rewards delivered to third-party tokens delegated to the Validator. Number three, yield enhancement. The company pursues accretive strategies to enhance yield earned on its tokens. In Q3 ’25, this included the launch of the company’s HiHYPE or Hyperion Institutional HYPE liquid staking token, gains on covered call option strategies included in the realized and unrealized gains on digital assets income statement line items and certain liquid staking activities.

Number four, DeFi monetization. The company supports and monetizes DeFi activity on the Hyperliquid blockchain with practices we believe to be sustainable and scalable. In Q3 ’25, this included the launch of the company’s proprietary HYPE Asset Use or HAUS platform, which allows its clients to unlock unique utility on Hyperliquid while generating fee income for Hyperion DeFi. We expect to be able to generate new revenue streams on top of staking, something that simply isn’t possible with traditional treasury assets. The company announced its first HAUS transaction with Credo in September 2025, which enables Credo to receive the benefit of lower trading fees on the Hyperliquid decentralized exchange with Hyperion DeFi receiving a portion of those savings as income while continuing to earn staking rewards.

The company’s second HAUS transaction was announced with Felix in October 2025, enabling Felix’s launch of new financial markets on the Hyperliquid blockchain with Hyperion DeFi receiving a portion of fees generated from their markets, again, while continuing to earn staking rewards. We have initiated a partnership with native markets to support their qualification of USDH, the Hyperliquid native stablecoin under the network’s Aligned Quota framework. We expect the partnership to go live in the fourth quarter and to hold some USDH on our balance sheet. Number five, ecosystem rewards. Through our active participation in the Hyperliquid DeFi ecosystem, we believe the company positions itself for the receipt of future potential token air drops, protocol incentives and other rewards that may become available periodically.

In Q3 ’25, the company’s Validator received over 3 million tokens delegated from the Hyperliquid Foundation. We also anticipate an ecosystem rewards opportunity near term with Kinetiq. Kinetiq is the largest institutional liquid staking protocol on Hyperliquid with over $1 billion in total value locked. As a reminder, through our co-branded Validator partnership with Kinetiq, Hyperion DeFi directly contributes to network security while generating staking yields on both our HYPE as well as HYPE delegated from other network participants toward our Validator. With them, we have created our own liquid staking token used to participate in offchain strategies and in Hyperion DeFi. We have Kinetiq points, and we anticipate being eligible for their token generation event.

We expect additional clarity on this topic in Q4. And number six, Life Sciences. Hyperion DeFi continues to develop its proprietary Optejet User Filled Device. As we enter the fourth quarter, we’re focused on several key strategic initiatives, expanding our HYPE asset use service offerings, deploying assets into additional DeFi products on HyperEVM and continuing to strengthen our position in supporting HIP3-enabled market launches, which we expect will require significant long-term HYPE stakes. We believe the fundamentals supporting our strategy continue to strengthen. Hyperliquid holds a position as a leading decentralized perpetuals exchange with over 60% market share as of October 31. Daily average revenues continue to exceed $3 million, supporting the buyback mechanism that has sequestered over 30 million HYPE tokens.

Our treasury position has grown to over 1.7 million HYPE tokens as of the end of Q3, positioning us to participate in the network’s anticipated continued expansion. We believe this is just the beginning of our transformation in the same way that this is still the beginning for Hyperliquid. We’re building what we believe is the new category of financial services company, one that combines public market accessibility with cutting-edge DeFi innovation. We hope that you all are as excited as I am for what’s to come. With that, I’ll turn the call over to David to walk through our third quarter financial results in detail.

David Knox: Thank you, Hyunsu, and good afternoon, everyone. I’m pleased to join Hyperion DeFi as Chief Financial Officer and participate in my first earnings call with the company. My appointment became effective on September 29, so I’ve been able to observe our Q3 results from both an external and internal perspective. Having spent my career scaling financial services businesses at institutions like PayPal, SoFi and Cantor Fitzgerald, I believe Hyperion DeFi represents a unique opportunity to participate in the institutional adoption of blockchain technology. The company’s strategic positioning and asset base are expected to provide multiple pathways for value creation that simply do not exist in traditional financial services.

This was a very positive quarter for us. Let me hit the highlights. We achieved income from operations of $4.4 million and GAAP net income of $6.6 million, both of which are record highs for the company. This results in net income per common share on a basic and diluted basis of $0.26 and $0.05, respectively. We started the quarter with $45.5 million invested in HYPE tokens. We purchased another $20.0 million worth of HYPE, and we recognized GAAP accretion of $7.1 million this quarter. Separate from our treasury gains, our revenues from digital assets businesses, which we just launched in the quarter and are only beginning to scale exceeded $300,000. We also achieved $8.0 million of adjusted EBITDA, which removes some large nonrecurring tailwinds to the quarter, such as debt extinguishment, plus reverses some GAAP nuances on our liquid staking tokens, which otherwise would have resulted in additional mark-to-market gains in the quarter.

I’m going to go through in detail our newly established key operating and financial results table, which is included on the first page of our earnings release and the third page of our earnings supplement, both of which can be found on our website. These are metrics that we think matter most to our business. Given the very recent initiation of our digital assets treasury strategy, we do not express any of these non-GAAP measures for periods prior to Q3 ’25 as we don’t think those comparisons would be useful for investors or for us as management. At the end of the quarter, about half of our digital asset treasury was in HYPE tokens and the other half was in HiHYPE, that’s HiHYPE, which is our company’s liquid staking token. To keep things simple, in this call, I’m going to refer to our HiHYPE as LST our liquid staking token.

Liquid staking means that we can earn staking yields on our LSTs while also deploying them into certain parts of the Hyperliquid DeFi ecosystem and also into some off-chain strategies. For example, in the third quarter, we used some of our LSTs as collateral when we entered into covered call strategies on the price of HYPE, which netted us some profits in Q3. As mentioned by Hyunsu earlier, LSTs also help us in optimizing our positioning for certain potential ecosystem rewards, including the upcoming Kinetiq airdrop. For the avoidance of doubt, we are also able to deploy our HYPE tokens into certain DFA activities, including our HAUS agreement with Credo announced in September and our HAUS agreement with Felix announced in October. The point is we have chosen to own both HYPE and our LSTs for different business purposes, and it’s important to understand how the accounting treatment is different between the 2 and how we adjust for those differences in our non-GAAP measures.

So when you look at the first row of this table, HYPE digital assets, that is a GAAP measurement of our HYPE tokens in isolation and does not include our LSTs. HYPE tokens are held at fair market value, which was $38.0 million at the end of Q3 on 840,000 tokens and a HYPE price of $45.19. HYPE tokens are remarked each quarter for any mark-to-market changes. In contrast, our LSTs are considered digital intangible assets and are carried at the lower of cost basis and impaired value. To put it simply, we cannot mark up our LSTs. However, sometimes we are required to mark them down from a GAAP perspective. This means that from time to time, our balance sheet carrying value on LSTs could be lower than the market value if we had converted all our LSTs back to HYPE.

And in addition, while we accrue HYPE tokens as staking rewards against our LSTs, the balance sheet and income impact of those rewards are not recognized in period from a GAAP perspective until the LSTs are converted back to HYPE. We estimate that the combination of these two factors, both the unrealized market value accretion on our LSTs plus our unrealized staking rewards on our LSTs would have added $4.9 million to our balance sheet and net income if we had elected to convert all our LSTs back to HYPE at the end of the third quarter. Therefore, in the second row of this table, we show our first non-GAAP measure gross HYPE Holdings of $77.8 million, which is the estimated market value of our combined HYPE and LSTs, inclusive of the $4.9 million LST pro forma REIT conversion.

And this corresponds to 1.7 million tokens shown in the next row and a HYPE price of $45.19 at the end of the quarter. Next, we show the number of tokens delegated to our Validator as of September 30, which was 8.2 million HYPE tokens. This information is publicly available real time on the Hyperliquid blockchain and website interfaces when you look for the Kinetiq x Hyperion Validator. Therefore, we are also showing this figure as of October 31, which was 13.2 million tokens, representing 60% month-over-month growth versus September. While we expect the total number of tokens delegated to our Validator to increase over the long term, there are multiple forces that could impact this number, and we expect the figure to be volatile going forward.

Net asset value, another non-GAAP metric, is meant to cover our estimated liquid digital assets less net debt totaling $74.5 million at the end of the quarter. It is calculated as our HYPE digital assets as adjusted to gross HYPE Holdings plus all current assets minus all current liabilities minus notional outstanding debt. Said another way, in the third quarter, our net asset value was $3.2 million lower than our gross HYPE Holdings as a function of outstanding net debt. Moving on to the next section in the table. We generated $303,000 of revenue in the third quarter completely from the digital asset strategy and none from our life sciences segment. This consisted of staking rewards, Validator commissions and our first HAUS agreement with Credo.

Our revenue this quarter was substantially higher than the less than $2,000 of revenue realized in the third quarter of 2024. In order to provide a more consistent view of our staking activities in period and our non-GAAP measure adjusted revenue, we take GAAP revenue and add in the unrealized staking rewards on our LSTs, which gives us the next figure in this table of $361,000 of adjusted revenue in Q3. Our Q3 GAAP income from operations of $4.4 million, a record high for the company, includes $7.1 million total GAAP accretion in our digital assets treasury, including yield enhancement from our covered calls in Q3. In terms of our operating costs, research and development expenses decreased 89% year-over-year from $3.5 million in Q3 ’24 to $374,000 in Q3 ’25.

And selling, general and administrative expenses declined 30% from $3.7 million in Q3 ’24 to $2.6 million in Q3 ’25. Keep in mind, our company has been through an extraordinary corporate transition over the past year. One year ago, in November 2024, the company provided an update that the Phase III CHAPERONE study on our proprietary drug device combination was not meeting its primary 3-year efficacy endpoint. The company then proceeded to execute significant cuts, which drove the operating cost savings that I just described. Today, we are continuing to pressure test every single expense line item, but we are also continuing to invest in having the right people, systems and processes to ensure that our digital assets treasury and DeFi business lines are both sustainable and scalable.

As we continue scaling and diversifying our DeFi operations, we are implementing comprehensive risk management frameworks appropriate for our expanded activities. This includes enhanced treasury policies, operational controls and regulatory compliance procedures. Our Board composition and governance structure have been strengthened to provide appropriate oversight of our DeFi strategy. We are committed to maintaining the transparency and accountability that public market investors expect while operating at the forefront of financial innovation. Back to R&D. We continue to make progress in our development and testing of our next-generation Optejet User Filled Device, and we continue to be on track to have an active registration and listing with the FDA in the coming months.

We previously announced that we expect operating costs to further decline once we achieve that milestone. We are also continuing to evaluate various strategic alternatives with regard to the future commercialization of the Optejet. The next row in this table is $6.6 million of net income in the third quarter. This was another record high for the company and compares to a net loss of $7.9 million in Q3 2024. In Q3 ’25, other income was boosted by $2.4 million due to reductions in life sciences liabilities, which we do not expect to be recurring. In the third quarter, we had a $795,000 dividend payment to preferred shareholders, resulting in net income attributable to participating securities at $5.8 million. Before we get into per share metrics, let me remind everyone of our capital transition over the last 6 months.

In June 2025, we received a $50 million PIPE investment involving the issuance of preferred shares and warrants, and we used the net proceeds primarily to establish our HYPE digital assets treasury. There are important conversion restrictions and other investor considerations related to the PIPE investment, which are more fully described in our SEC filings. However, if warrant holders choose to exercise their warrants for shares of common stock of the company, we would anticipate using a substantial portion of the related net proceeds to buy more HYPE tokens and generate more revenue and income. With all that being said, based on 6.0 million basic weighted average common shares outstanding and 29.0 million diluted weighted average common shares outstanding, net income per common share in the third quarter on a basic and diluted basis was $0.26 and $0.05, respectively.

For the last row on this table, we are showing the non-GAAP measure adjusted EBITDA of $8.0 million in the third quarter. There are some important reconciliations from net income, so let’s go point by point. Stock-based compensation is removed from our adjusted EBITDA. In Q3, stock-based compensation was negative $1.3 million, meaning it was a tailwind to Q3 net income. This was unusual. It happened primarily because of the timing of certain stock-based awards in connection with recent changes in the company’s leadership. Next, we removed $223,000 interest expense in the quarter. Then we removed the $2.4 million of nonrecurring Q3 gains from reductions in life sciences liabilities. These were extinguishments or reductions in liabilities which we held on our balance sheet as of Q2.

We also back out a few other nonrecurring items totaling $56,000 of GAAP gains, including gains on sales of life sciences equipment. Finally, we add the same $4.9 million LST pro forma reconversion that I mentioned earlier. From an operational perspective, we aim to optimize our HYPE versus LST holdings for long-term shareholder value and not for near-term income recognition implications. Within income from operations, total accretion on our digital assets was $7.1 million in Q3. But if we had converted all our LSTs back, we believe this figure would have instead been $12.0 million. Over time, we expect this line item on LST reconversion within adjusted EBITDA to cumulatively net to 0. If, for example, all LSTs are reconverted in Q4 ’25, we would anticipate a positive $4.9 million tailwind to Q4 net income and would expect an offsetting negative $4.9 million in our Q4 adjusted EBITDA on this line item.

That closes out my discussion on the key operating and financial results table. I am now going to briefly touch on cash flows, liquidity and guidance. Net cash used in operating activities decreased from $24.0 million for the 9 months ended September 30, 2024, to $10.7 million for the 9 months ended September 30, 2025. And in the past 3 months, net cash used in operating activities was less than $3 million. Owing to our successful corporate and financial transition over the past year in management’s view, the company now has a very solid liquidity profile. At the end of the quarter, we had $8.2 million of cash and cash equivalents. Our outstanding loan owed to Avenue Capital is carried on the balance sheet at $7.7 million, which is net of $599,000 of unamortized debt discount, meaning the notional balance owed is $8.3 million.

This loan is in an interest-only period at 8% fixed rate per annum until principal payments begin in 2027. And in addition, only half of the interest is payable in cash and the other half is payable in kind, increasing the balance of the loan, meaning the cash interest expense on this loan effectively at 4% per annum is expected to be less than $90,000 in the fourth quarter of 2025. On the preferred shares, we have a quarterly fixed dividend of $795,000. And while we recently elected to pay this in cash, we also have the option to pay in common shares instead. Our operations and cash flows are more fully described in our filings, but summing up a few items I just mentioned. About $3 million operating cash outflows, plus about $90,000 cash interest plus $795,000 in dividends, which don’t need to be paid in cash, equates to approximately $3 million to $4 million combined at Q3 run rate versus $8.2 million of cash and cash equivalents at the end of the quarter.

And in Q3, we raised $21.8 million net of expenses via our at-the-market equity offering program or ATM, which we believe demonstrates our ongoing ability to raise funds needed. Quickly highlighting investing and financing cash flows. Net cash used in investing activities increased from $161,000 for the 9 months ended September 30, 2024, to $65.6 million for the 9 months ended September 30, 2025, primarily to purchase HYPE Tokens. In June, we purchased $45.5 million worth of HYPE funded by our PIPE investments. In the third quarter, we raised $21.8 million net proceeds from our ATM and purchased an additional $20.0 million worth of HYPE. Since the end of the third quarter, we have continued raising funds via our ATM, and we have kept buying more HYPE tokens, including during mid-October following the broad market sell-off.

We plan to continue to operate with a balanced approach regarding our fundraising and our HYPE purchases, and we’ll continue to weigh all relevant financial and liquidity factors, including our opportunities to deploy any HYPE that we purchase. Looking ahead to Q4 2025, we expect continued growth in our DeFi-related revenues. Our pipeline of potential HYPE asset use service clients is robust with several institutional clients expressing interest in similar arrangements to our Credo and Felix partnerships. Staking and Validator revenues are expected to continue to increase as the Hyperliquid network expands and our staked and delegated positions grow. Our Kinetiq x Hyperion Validator currently sits among the top 10 Validators by stake with 13.2 million HYPE delegated as of October 31.

On top of our option strategies, we are also exploring additional yield generation opportunities through HyperEVM DeFi protocols, though these remain in early stages. This is now the first time in the company’s history that we are initiating financial guidance. As we consider our metrics that matter, while we have a strong point of view that HYPE is the most compelling digital asset and that buying HYPE may produce outsized returns to investors over time, we don’t consider it useful to provide near-term price predictions. Instead, given the growth we are anticipating across all our business lines, we are pleased to give guidance focused on our operations. We anticipate Q4 ’25 adjusted revenues between $475,000 and $515,000, representing a 31% to 43% quarter-over-quarter increase versus Q3.

We expect our adjusted revenue growth rate to continue to accelerate into 2026. We are already off to a great start in Q4 with 2 new DeFi monetization partnerships already announced, plus 60% month-over-month growth on tokens delegated to our Validator from September to October. The other guidance we are providing is that we anticipate our operating cash flow to turn positive in 2026, meaning we aim to achieve a run rate where we don’t need to raise funds, draw down on our cash or sell HYPE tokens in order to fund ongoing company operations. We are highly convicted on the opportunity ahead of us. And while 2025 has already been a remarkable year of firsts for the company, we believe that achieving operating cash flow positivity in 2026 will be one of the most important inflection points for our company.

We are already engaging in 5 unique digital assets business strategies less than 6 months after establishing our digital assets treasury, and we expect all of them to achieve scale in 2026. As a reminder, these are staking yields, validated commissions, yield enhancement, DeFi monetization and ecosystem rewards. We believe our flywheel effect to compound our HYPE Holdings is simply unparalleled. With that, I’ll turn it back over to Jason, and we look forward to answering your questions.

Jason Assad: Thank you very much, David. [Operator Instructions] Here’s our first question. How did the crypto liquidation event on October 10 impact your business?

Hyunsu Jung: Yes. While October 10 was a very unfortunate event that created substantial economic losses for many market participants, it really demonstrated the resilience of on-chain smart contract platforms. So Hyperliquid’s centralized exchange suffered 0 downtime or outages and the applications on HyperEVM, including lending and borrowing, worked perfectly without incurring any bad debt, which was not the case for other exchanges. More specific to Hyperion DeFi, none of our business operations were affected given that we have not taken on any leverage positions with our HYPE assets. As we mentioned before, our focus is on deploying natively staked HYPE to secondary yield-generating mechanisms such as HIP3. And we also saw more importantly, that even after this flush out of risk, trading volumes and associated fees quickly returned to Hyperliquid, which demonstrates market that there is demand for participants to continue to position their strategies on decentralized exchanges.

Jason Assad: Thank you. What do you think of recent regulatory developments and their impact on DeFi and your business?

Hyunsu Jung: Yes, great question. So we are currently in an extremely dynamic regulatory environment that is broadly favorable due to the current administration. And we would expect to continue to see clarity around how crypto and DeFi will interact with existing financial infrastructure. The passing of the GENIUS Act, for example, encourages continued innovation in stablecoins under a more clear regulatory framework, which serves as a tailwind for the development of Hyperliquid native stablecoins like USDH. David, it would be great, too, if you want to add your thoughts here.

David Knox: Absolutely, and thanks, Hyunsu. We place ourselves on the cutting edge of financial innovation. And because of that, we believe that we have a duty and an obligation to operate responsibly. This means choosing to operate in ways where we believe we can navigate various regulatory outcomes, and we welcome any additional clarity with regards to cryptocurrency, digital assets and DeFi regulation.

Jason Assad: Thank you, David. This investor asks, are you considering an additional capital raise?

Hyunsu Jung: Great question. So after raising $50 million for our PIPE back in June, we moved very quickly to purchase HYPE and establish the foundations of our business, which, again, as a reminder, is our Validator and the development of the proprietary HAUS platforms and other additional initiatives to engage with and support Hyperliquid. Now these efforts support the growth of the ecosystem, and our focus is not simply buying and holding the assets, but to build and scale real businesses on chain. So we’ve established that foundation and the focus would be to continue to accumulate HYPE and refining what we’ve built. I’ll hand it off to David here just with regard to capital markets activity.

David Knox: Sure. Thanks, Hyunsu. We believe that HYPE is the most compelling digital asset and that over time, we are going to purchase more. As we think through how we might contemplate an additional raise and additional fundraisings, we’re going to consider important financial factors like liquidity, like market conditions and like how we think we can deploy our HYPE tokens most effectively throughout our various business strategies. As mentioned previously, we did raise $21.8 million via our ATM in the third quarter, with which we bought back another $20.0 million of HYPE tokens and use cash for other purposes. And we have continued raising funds via our ATM in the fourth quarter.

Jason Assad: Thank you, David. This one is on Aster and Lighter. They’re asking, do you see it as a credible threat to Hyperliquid?

Hyunsu Jung: So there have been on-chain perpetuals markets before, like GMX and dYdX, and we expect that others may continue to come in the future. In our opinion, none of them are like Hyperliquid. So holistically, it is true that when a new entrant like Aster or Lighter join a market that is seeing a lot of attention, users may be interested in trying the shiny new thing. Competition is healthy because it encourages everyone to refine their product and be better, and it also helps the pie grow bigger, in this case, on-chain derivatives. But beyond this, Hyperliquid has done so many things differently. It’s entirely self-funded with no VC capital. It’s distributed over 30% of its token supply to early users. It remains credibly neutral.

It’s even refunded user funds when network issues have emerged. And more importantly, its rate of innovation is unmatched. It seems that those that are coming into the perpetual debt space now are playing a little bit of catch-up, whereas with Hyperliquid, with products like HIP3, which enable the permissionless launch of non-crypto assets and also aligned quota assets, it creates new demand things for HYPE and expands the universe of participants to Hyperliquid, and that’s where we, at Hyperion see the opportunity.

Jason Assad: Great. Thank you. Robert asked, is mNAV a useful metric to you?

Hyunsu Jung: So we believe mNAV was an appropriate metric during the first generation of digital asset treasuries when there wasn’t a proper way to measure the value of the company besides the value of the assets in the balance sheet versus its market cap. We see this kind of changing now with new strategies from the, call it, the second generation of digital asset treasuries with strategies like staking, restaking derivatives. None of them, however, are able to do so far what Hyperion has done within the Hyperliquid ecosystem with real revenue-generating businesses built on top of our treasury asset HYPE. So not to reiterate the point too much, but the HYPE Asset Use Service products are ways of not only just earning the native staking yield, but compounding those returns through mechanisms that also support the growth of new products, expanding the user base to Hyperliquid and also onboarding and scaling financial activities.

And so we see a world where companies like ours are actually measured by a combination of both the asset value and future cash flows.

Jason Assad: Great. Thank you, Hyunsu. This one is regarding how do we — what measures do we take to secure our tokens?

Hyunsu Jung: So self-custody infrastructure using infrastructure provided by Anchorage Digital Bank. There is also ways to utilize the native multi-sig offered on Hyperliquid to build secondary level protections on top of our existing HSM and MPC infrastructure. And it’s our job to continue to diligence other service providers, infrastructure providers to ensure that we are always up to date and using the best mechanisms possible to protect the HYPE assets on behalf of the company and our shareholders.

Jason Assad: How would we differentiate ourselves from other [ debts ]?

Hyunsu Jung: The simple answer is that we do not just buy and hold our treasury assets. It seems that staking to the network and contributing to security should just be baseline. Now Hyperion runs our own top 10 Validator with over 13 million HYPE stake to it, which does become real revenues for Hyperion. But more so than that, we have so many mechanisms to use that stake HYPE and redeploy it into the ecosystem. And these strategies not just compound yield and generate sources of revenue, but they also help create the flywheel effect that brings more users and activity to Hyperliquid. And as we mentioned before, with the Hyperliquid assistance fund, we have a precedent where the more fees and revenues that are generated within the ecosystem, 99% of them are going back to purchase back HYPE. And so we think this is a really powerful mechanism, and it’s our role with Hyperion to continue to innovate financial products that enable this to continue.

Jason Assad: Thank you. This one is regarding the Kinetiq airdrop. Is that baked into our forecast?

Hyunsu Jung: David, do you want to speak to this one?

David Knox: Absolutely, and thank you for the question. So here is what we know. We have Kinetiq points. We believe we will be eligible for the token generation of airdrop. We do not know what the financial implications will be, nor do we have a reasonable basis to take a view on if it’s going to be material or not material. But there’s 2 important points that I want to make here. The first is we have not adversely positioned our balance sheet or our operations to try and take advantage of this opportunity. Our joint Validator agreement between us and Kinetiq and Pier Two is a top 10 Validator on the Hyperliquid blockchain with north of 13 million tokens as of the end of October, which is 60% month-over-month growth. In addition, the activities that we do with Kinetiq include our liquid staking HiHYPE token, which provides real utility to us in terms of being able to stake our HYPE, deploy into HyperEVM and use in off-chain situations like when we used HiHYPE as collateral for our Q3 covered call option strategy, which netted some profits in Q3.

So this is why in our earnings supplement, we present these various business activities as compounding on top of each other, staking yields plus Validator commissions plus yield enhancement plus DeFi monetization plus ecosystem rewards. Because we really do believe that this all adds up together. And the second point that we want to make here, we don’t know when or if there’s going to be other opportunities like this, but we’ve only been doing this less than 6 months, and there’s already been 2. The first was when the Hyperliquid Foundation delegated to our Validator 3 million tokens in the third quarter. And the second now with this Kinetiq rewards, for us, this shows that our flywheel effect is really beginning to work. We are building these businesses on the Hyperliquid blockchain, which both promote and monetize Hyperliquid’s use.

And now the ecosystem is rewarding us back. So this gives us even more conviction in our core thesis that HYPE is the most compelling digital asset, that the Hyperliquid blockchain is ripe for innovation and monetization. And we’re very, very pleased to be simultaneously supporting and sharing in the upside of this growing ecosystem.

Jason Assad: Thank you. Jonathan, one of our legacy shareholders asked, why have we not sold the Optejet?

Hyunsu Jung: Thanks for the question. Yes, with regard to the Optejet, we’re taking a rational approach to that side of the business. It has commercialization potential. We maintain both patents and IP developed over the years. We are still completing R&D and testing to reach a position of commercial viability. So we’ve had a number of conversations with people in the industry, and we’re taking it one step at a time. David, feel free to add some color here.

David Knox: Thanks, Hyunsu, and that’s right. All of our knowledge and conversations support our thesis that the best financial outcome for the company is to continue towards that next milestone of having an active registration and listing with the FDA. And in the fourth quarter, we’ve continued to do some testing towards that milestone. But we will continue to have a rational approach and evaluate options available to us.

Jason Assad: Thank you. I think we have time for one last question. They’re asking, are you going to hire more people?

Hyunsu Jung: So Hyperion DeFi’s mandate is to continue to accumulate and generate revenue on what we believe to be the most compelling digital asset type, so that our shareholders can benefit from this comprehensive exposure to decentralized finance. Now to accomplish that, we must continue to operate responsibly and minimize cost on the operating side. So currently, we do remain fully supported across key business functions, and we want to remain very lean as we continue to move forward. Now the beauty of blockchain-based businesses is that similar to SaaS or other Web 2 products is that once they are properly designed, they are almost infinitely scalable. Hyperion DeFi has long-term ambitions far beyond simply operating in DeFi actually.

Our goal is to become the bridge between institutional finance and on-chain financial primatives. And that’s going to take time, and it’s going to require a team of really some of the best-in-class people across industries, which obviously we’ve already started to build. And so a very long-winded way of saying it’s definitely in the road map, but we want to focus on our core business first, which is ensuring that we develop a robust revenue-generating business lines within this DeFi space built on Hyperliquid.

Jason Assad: Thank you. So this concludes the question-and-answer session. If you have additional questions that we didn’t get to, please feel free to send them to ir@hyperiondefi.com. And we, of course, will be happy to get back with you. At this time, I’d like to now turn the call back over to Interim CEO, Hyunsu Jung, for his closing remarks.

Hyunsu Jung: All right. Thank you, Jason. As we conclude today’s call, I want to emphasize the significance of what we’ve accomplished and what lies ahead. Q3 2025 was our first full quarter operating as Hyperion DeFi, and we believe the results demonstrate the viability of our strategic transformation. We believe our performance shows that a public company can successfully participate in DeFi ecosystems while maintaining institutional-grade governance and creating shareholder value. We believe our achievements this quarter were expanding our HYPE treasury to launching innovative revenue-generating services to appointing world-class financial leadership position us for accelerated growth in Q4 and beyond. We view the broader macro environment for institutional DeFi adoption as continuing to improve.

In our view, regulatory clarity is increasing, institutional infrastructure is maturing and the performance advantages of platforms like Hyperliquid are becoming more recognizable. We believe Hyperion DeFi is positioned at the center of this transformation. Looking ahead, our priorities remain focused on 3 key areas: continuing to build our strategic HYPE position, expanding our portfolio of DeFi services and developing the institutional infrastructure necessary to bring traditional finance onto blockchain platforms. We’re so grateful for the support of our shareholders throughout this transformation and excited about the opportunities ahead. Hyperion DeFi is building for the future of institutional finance, and we are just getting started.

Operator: Thank you, ladies and gentlemen. And with that, this does conclude today’s teleconference. We thank you for your participation, and enjoy the rest of your evening.

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