USBC, Inc. (NYSE American: USBC), formerly known as Know Labs, Inc., reported significant financial developments in its Transition Report for the three-month period ending December 31, 2025. The company recorded a net loss of $27.5 million, a substantial increase from a net loss of $4.7 million during the same period in the previous year. This increase is primarily attributed to a $27.2 million change in the fair value of digital assets, reflecting heightened volatility in the digital asset markets, alongside a $11.9 million rise in non-cash stock-based compensation expenses. The company did not generate any operating revenue during the Transition Period, consistent with the prior year.
USBC's operating expenses surged to $17.1 million, up from $2.8 million in the previous year, driven largely by increased selling, general, and administrative expenses, which rose by $14.9 million. This increase was largely due to professional fees and public company costs associated with the company's strategic transition, as well as salary and benefits expenses. Research and development expenses decreased to $254,000 from $802,000, reflecting a strategic pivot away from its legacy non-invasive diagnostics and sensor technology initiatives towards the development of its tokenized deposit platform.
Strategically, USBC has made significant moves, including a $125 million acquisition by Goldeneye 1995 LLC, which resulted in the issuance of approximately 357.8 million shares of common stock in exchange for Bitcoin and cash. The company has also formalized a partnership with Uphold HQ Inc. and Vast Bank, which will serve as the initial issuing bank for its USBC tokenized deposit offering. This partnership aims to leverage blockchain technology to create a tokenized representation of U.S. dollar deposits, enhancing financial inclusion and innovation.
As of December 31, 2025, USBC had cash and cash equivalents of $4.1 million and working capital of $3.1 million. The company anticipates requiring additional liquidity sources to fund ongoing operations and the development of its tokenized deposit program. To support this, USBC entered into a Master Loan Agreement with Payward Interactive, Inc., allowing for borrowings of up to $25 million, secured by Bitcoin collateral. The company expects to continue incurring operating losses in the near term but believes its capital structure and potential revenue opportunities will provide the necessary flexibility to pursue its strategic initiatives.
About KNOW LABS, INC.
Know Labs, Inc. develops non-invasive diagnostic technology using radio and microwave dielectric spectroscopy to identify and measure molecules and analytes in the human body. Its core focus is on blood glucose monitoring, with plans to expand into other health and wellness applications. The company leverages proprietary sensors, AI-driven algorithms, and extensive patent portfolio to create wearable devices and platform solutions for medical and consumer markets.
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