BTCS Inc. (BTCS) Experiences Q1 Income of $563K, EPS of ($0.47)

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    BTCS Inc. (Nasdaq: BTCS) in the present day introduced its outcomes for the primary quarter ended March 31, 2022.

    Q1 2022 Highlights

    • Increasing blockchain infrastructure operations drove Q1 income up 29% over This autumn 2021 and up 776% over Q1 2021 to $0.6 million
    • 76% gross margins for the three months ended March 31, 2022 in comparison with 79% and 72% for Q1 2021 and This autumn 2021 respectively
    • $5.8 million GAAP internet loss, primarily triggered by non-cash fees in comparison with $11.6 million GAAP internet loss for Q1 2021
    • Stockholders’ fairness elevated 44% to $17.4 million at March 31, 2022, up $5.3 million from December 31, 2021
    • Truthful market worth of digital property elevated to roughly $41.3 million as of March 31, 2022, up 13% in comparison with December 31, 2021, and up 105% versus March 31, 2021
    • Money and truthful market worth of digital property $43.6 million or $3.45 per share as of March 31, 2022
    • Declared a particular one-time $0.05 per share dividend payable in Bitcoin at election of shareholders, changing into the primary U.S. public firm to situation such a dividend
    • Strengthened management group with the addition of Chief Expertise Officer

    Blockchain Infrastructure Replace

    BTCS continued to develop its blockchain infrastructure operations within the first quarter of 2022, asserting the addition of Algorand, Kusama, Solana, Polkadot, and Terra. Subsequent to the quarter finish, the Firm introduced the addition of Polygon and Kava to its infrastructure operations. A major driver of income development, the Firm’s blockchain infrastructure operations are a excessive revenue margin element of its enterprise mannequin, and margins are anticipated to enhance as operations scale. Analysis and improvement associated to the technical work wanted to run further validator nodes on new blockchains stays ongoing.

    Administration Commentary

    “We continued to develop our blockchain infrastructure phase in Q1 and anticipate ongoing development within the quarters forward as we add new blockchains to our increasing operations,” acknowledged Charles Allen, Chief Government Officer of BTCS. “As a high-margin element of our enterprise, our blockchain infrastructure operations have been a key driver behind the 76% gross margins achieved in Q1. The truth that we have been in a position to develop high-margin revenues regardless of the backdrop of utmost volatility within the crypto markets is a robust testomony to the energy of our technique, and I imagine we’re in an amazing place to construct on this success as we proceed to capitalize on alternatives to create new worth for shareholders.”

    “Our potential to successfully execute our technique throughout Q1 was integral to our potential to perform yet one more first for a U.S. public firm– the declaration and fee of a ‘Bividend’, a dividend that was paid in Bitcoin to shareholders of document who elected as such,” added Allen. “Innovation is the cornerstone of the blockchain trade and a foundational element of our success.”

    “Whereas enlargement of our blockchain infrastructure operations is the important thing focus throughout Q1 and the approaching quarters, our group is advancing the event of our Digital Asset Platform towards full business launch throughout the quarter,” added Michal Handerhan, COO of BTCS. “With the February appointment of our new Chief Expertise Officer, Manish Paranjape, who has been concerned within the improvement of our Digital Asset Platform since early 2021, we imagine ongoing improvement will additional speed up, enabling us to finish the present Beta part and enter the market within the second half of this 12 months.”

    “As crypto market individuals, we’re nicely conscious of its present turmoil. Market cycles are inevitable, nevertheless, the best way they take form is all the time completely different. The general cycles repeat with pullbacks each ten years or so, and smaller slumps in markets seem way more often – Nasdaq retraced throughout the Dot Com Period and once more throughout the Nice Recession in 2007-2008. Crypto cycles have tended to be extra frequent and get better extra shortly than inventory market cycles. Regardless of the current turmoil our money and crypto positions stay robust, and we imagine we’re nicely positioned to not solely climate the storm however thrive sooner or later” added Allen.

    About BTCS:

    BTCS is an early mover within the blockchain and digital foreign money ecosystem, and the primary “Pure Play” U.S. publicly traded firm targeted on blockchain infrastructure and know-how. By way of its blockchain infrastructure operations, the Firm secures Proof-of-Stake blockchains by actively processing and validating blockchain transactions and is rewarded with native digital tokens. The Firm is creating a proprietary Staking-as-a-Service platform to permit customers to stake and delegate supported cryptocurrencies by a non-custodial platform, which it plans to combine with its Digital Asset Dashboard, now in beta launch. BTCS’ proprietary Digital Asset Platform at present helps six exchanges and over 800 digital property, and the Firm plans to additional broaden its suite of performance-tracking instruments, add further centralized and decentralized exchanges, in addition to wallets, and stake pool monitoring. For extra info go to:

    Ahead-Wanting Statements:Sure statements on this press launch, represent “forward-looking statements” inside the that means of the federal securities legal guidelines together with statements relating to our perception relating to anticipated enchancment in margins, anticipated development in our operations, persevering with to capitalize on alternatives to create shareholder worth, launching our Digital Asset Platform and the acceleration of such launch throughout the second half of 2022, our potential to thrive on this market. Phrases akin to “could,” “may,” “will,” “ought to,” “imagine,” “count on,” “anticipate,” “estimate,” “proceed,” “predict,” “forecast,” “challenge,” “plan,” “intend” or comparable expressions, or statements relating to intent, perception, or present expectations, are forward-looking statements. Whereas the Firm believes these forward-looking statements are affordable, undue reliance shouldn’t be positioned on any such forward-looking statements, that are based mostly on info accessible to us on the date of this launch. These forward-looking statements are based mostly upon present estimates and assumptions and are topic to varied dangers and uncertainties, together with with out limitation, the rewards and prices related to validating transactions on proof-of-stake blockchains, a major lower within the worth within the crypto that we at present personal, loss or theft of the personal withdrawal keys ensuing within the full lack of digital property and reward, surprising points with our Digital Asset Platform, reluctance of customers to simply accept our product, in addition to dangers set forth within the Firm’s filings with the Securities and Change Fee together with its Kind 10-Okay for the 12 months ended December 31, 2021 and the Prospectus Complement dated September 14, 2021. Thus, precise outcomes could possibly be materially completely different. The Firm expressly disclaims any obligation to replace or alter statements whether or not because of new info, future occasions or in any other case, besides as required by legislation.

    Investor Relations:Dave GentryRedChip Firms, Inc.Cellphone: (407) 491-4498[email protected]

    Public Relations: Mercy Chikowore[email protected]

    GAAP Financials

    The tables beneath (previous the part titled “Non-GAAP – Monetary Measure”) are derived from the Firm’s monetary statements included in its Kind 10-Q filed on Could 13, 2022 with the Securities and Change Fee. Please discuss with the Kind 10-Q for full monetary statements and additional info relating to the Firm’s outcomes of operations and monetary situation regarding the fiscal quarter ended March 31, 2022 and 2021. Please additionally discuss with the Firm’s Kind 10-Okay for a dialogue of threat components relevant to the Firm and its enterprise.

    BTCS Inc.Steadiness Sheets

    March 31, December 31,
    2022 2021
    Present property:
    Money $ 2,245,062 $ 1,400,867
    Digital property/currencies 2,617,730 3,117,360
    Staked digital property/currencies 6,601,777 623,754
    Pay as you go expense 315,169 324,551
    Complete present property 11,779,738 5,466,532
    Different property:
    Property and gear, internet 11,544 9,783
    Staked digital property/currencies – long run 8,684,238 8,625,678
    Complete different property 8,695,782 8,635,461
    Complete Property $ 20,475,520 $ 14,101,993
    Liabilities and Stockholders’ Fairness:
    Accounts payable and accrued expense $ 106,144 $ 138,716
    Accrued compensation 3,209 7,334
    Capital shares payable 75,002
    Dividends payable 266,231
    Warrant liabilities 2,493,750 1,852,500
    Complete present liabilities 2,944,336 1,998,550
    Stockholders’ fairness:
    Widespread inventory, 97,500,000 shares licensed at $0.001 par worth, 12,616,010 and 10,528,212 shares issued and excellent at March 31, 2022 and December 31, 2021, respectively 12,617 10,529
    Extra paid in capital 158,848,780 147,682,384
    Accrued deficit (141,330,213 ) (135,589,470 )
    Complete stockholders’ fairness 17,531,184 12,103,443
    Complete Liabilities and Stockholders’ Fairness $ 20,475,520 $ 14,101,993

    BTCS Inc.Statements of Operations(Unaudited)

    For the Three Months Ended
    March 31,
    2022 2021
    Validator income (internet of charges) $ 563,015 $ 72,524
    Complete revenues 563,015 72,524
    Price of revenues
    Validator expense 137,869 14,996
    Gross revenue 425,146 57,528
    Working bills:
    Basic and administrative $ 650,289 $ 553,981
    Analysis and improvement 136,718 82,933
    Compensation and associated bills 1,423,896 7,337,679
    Advertising and marketing 41,793 1,421
    Complete working bills 2,252,696 7,976,014
    Different revenue (bills):
    Curiosity expense (54,247 )
    Amortization on debt low cost (562,096 )
    Change in truthful worth of warrant liabilities (641,250 )
    Distributions to warrant holders (35,625 )
    Impairment loss on digital property/currencies (3,307,428 ) (1,301,764 )
    Realized good points (loss) on digital asset/foreign money transactions 71,110 3,054,418
    Complete different revenue (bills) (3,913,193 ) 1,136,311
    Web loss $ (5,740,743 ) $ (6,782,175 )
    Deemed dividends associated to amortization of helpful conversion characteristic of Sequence C-2 convertible most popular inventory (16,176 )
    Deemed dividends associated to recognition of downround adjustment to conversion quantity for Sequence C-2 convertible most popular inventory (4,822,220 )
    Web loss attributable to widespread stockholders $ (5,740,743 ) $ (11,620,571 )
    Web loss per share attributable to widespread stockholders, primary and diluted $ (0.47 ) $ (2.43 )
    Weighted common variety of widespread shares excellent, primary and diluted 12,245,278 4,777,894

    BTCS Inc.Statements of Money Flows(Unaudited)

    For the Three Months Ended
    March 31,
    2022 2021
    Web Money flows used from working actions:
    Web loss $ (5,740,743 ) $ (6,782,175 )
    Changes to reconcile internet loss to internet money utilized in working actions:
    Depreciation expense 797 212
    Amortization on debt low cost 562,096
    Inventory-based compensation 1,289,274 7,539,560
    Inventory-based compensation in reference to issuance of Sequence C-2 convertible most popular inventory 179,277
    Validator income (563,015 ) (72,524 )
    Blockchain community charges (non-cash) 1,321
    Change in truthful worth of warrant liabilities 641,250
    Buy of non-productive digital property/currencies (5,761,549 )
    Sale of non-productive digital property/currencies 4,274,491
    Realized achieve on digital property/currencies transactions (71,110 ) (3,054,418 )
    Impairment loss on digital property/currencies 3,307,428 1,301,764
    Adjustments in working property and liabilities:
    Pay as you go bills and different present property 9,382 (421,384 )
    Accounts payable and accrued bills (36,329 ) 42,267
    Accrued compensation (4,125 ) (348,875 )
    Capital shares payable 75,002
    Dividends payable – distributions to warrant holders 35,625
    Web money utilized in working actions (1,055,243 ) (2,541,258 )
    Web money utilized in investing actions:
    Buy of productive digital property/currencies for validating (8,521,726 ) (7,994,887 )
    Sale of productive digital property/currencies 310,149
    Buy of property and gear (2,558 )
    Web money utilized in investing actions (8,214,135 ) (7,994,887 )
    Web money supplied by financing actions:
    Dividend distributions (400,194 )
    Proceeds from train of warrants 400,000
    Proceeds from issuance of Sequence C-2 convertible most popular inventory 1,100,000
    Web proceeds from issuance of convertible notes 1,000,000
    Web proceeds from issuance of widespread inventory and warrants for money 8,865,000
    Web proceeds from issuance of widespread inventory 2,014,259
    Web proceeds from issuance widespread inventory/ At-the-market providing 10,513,767
    Fee to convertible notes precept
    Web money supplied by financing actions 10,113,573 13,379,259
    Web enhance in money 844,195 2,843,114
    Money, starting of interval 1,400,867 524,135
    Money, finish of interval $ 2,245,062 $ 3,367,249
    Supplemental disclosure of non-cash financing and investing actions:
    Deemed dividends associated to amortization of helpful conversion characteristic of Sequence C-2 convertible most popular inventory $ $ 16,176
    Deemed dividends associated to recognition of downround adjustment to conversion quantity for Sequence C-2 convertible most popular inventory $ $ 4,822,220
    Conversion of Sequence C-1 Most popular Inventory $ $ 196
    Helpful conversion characteristic of Sequence C-2 convertible most popular inventory $ $ 129,412
    Helpful conversion options related to convertible notes payable $ $ 1,000,000
    Dividends payable $ 230,606 $

    Non-GAAP – Monetary Measure

    Along with our outcomes decided in accordance with GAAP, we imagine Adjusted EBITDA, a non-GAAP measure, is beneficial in evaluating our working efficiency. We imagine that Adjusted EBITDA could also be useful to buyers as a result of it offers consistency and comparability with previous monetary efficiency and the financial realities of our enterprise. Nevertheless, Adjusted EBITDA is introduced for supplemental informational functions solely, has limitations as an analytical instrument, and shouldn’t be thought of in isolation or as an alternative to monetary info introduced in accordance with GAAP. Amongst different non-cash and non-recurring objects, Adjusted EBITDA excludes stock-based compensation expense (together with stock-based compensation issued to service suppliers), which has lately been, and can proceed to be for the foreseeable future, a major recurring expense for our enterprise and an necessary a part of our compensation technique. As well as, different corporations, together with corporations in our trade, could calculate equally titled non-GAAP measures in another way or could use different measures to judge their efficiency, all of which might cut back the usefulness of our non-GAAP monetary measures as instruments for comparability. A reconciliation is supplied beneath for every non-GAAP monetary measure to probably the most instantly comparable monetary measure acknowledged in accordance with GAAP. Traders are inspired to evaluate the associated GAAP monetary measures and the reconciliation of those non-GAAP monetary measures to their most instantly comparable GAAP monetary measures, and to not depend on any single monetary measure to judge our enterprise.

    We calculate Adjusted EBITDA as internet revenue (loss), adjusted to exclude, depreciation and amortization, curiosity expense, change in truthful worth of warrant liabilities, and stock-based compensation expense (together with stock-based compensation issued to service suppliers). Adjusted EBITDA introduced doesn’t embody changes for impairment of intangible digital property. Observe: In earlier disclosures of Adjusted EBTIDA impairment of intangible property had been included as an adjustment added again.

    The desk beneath presents our Adjusted EBITDA reconciled to our internet loss, the closest GAAP measure, for the interval indicated:

    Three Months Ended March 31,
    2022 2021
    Web revenue (loss) $ (5,740,743 ) $ (6,782,175 )
    Adjusted to exclude the next:
    Depreciation and amortization 797 562,096
    Curiosity expense 54,247
    Change in truthful worth of warrant liabilities 641,250
    Inventory-based compensation 1,364,276 7,281,477
    Adjusted EBITDA (3,734,420 ) 1,115,645

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    Supply: BTCS Inc.

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