Eightco Holdings (ORBS) Risk Analysis

We intend to purchase or otherwise acquire more WLD for the furtherance of our digital asset treasury operations. Digital assets, such as WLD, generally are highly volatile assets, including as a result of shifts in market sentiment, speculative trading, macroeconomic trends, technology-related disruptions and regulatory announcements. Our operating results and share price may significantly fluctuate, including due to the highly volatile nature of the price of such digital assets and erratic market movements. In addition, digital assets do not pay interest or other returns, unless utilized in financial applications, and so the ability to generate a return on investment from the net proceeds of any capital raising activities will depend on whether there is appreciation in the value of digital assets following our purchases, which is highly speculative. Future fluctuations in digital asset trading prices may result in our converting digital assets into cash with a value substantially below what we paid for such digital assets. There is no guarantee that digital assets such as WLD will continue to represent any measure of value. Any decreases in the value of WLD could have a material adverse effect on our financial condition and results of operations. See also "-Ownership of WLD is believed to be highly concentrated."

Tools for Humanity, a for-profit company, was created to develop and operate the core hardware and software behind the WLD protocol. It established the World Foundation as a separate non-profit entity to steward the protocol. The World Foundation relies on Tools for Humanity for engineering, product and operational execution and it may provide WLD as consideration for these services. According to Worldcoin's blog, the total supply of WLD when launched was 10 billion. Before launch, 75% of the total WLD were allocated to the World Foundation (the "WF WLD"), and 25% of the total of WLD were allocated to Tools for Humanity, those individuals linked to the owners of Tools for Humanity, and other early founders of Tools for Humanity (the "TFH WLD"). As of April 2026, about 3.2 billion or 32% of the total supply was in circulation. The timing and conditions under which the tokens are released into circulation are important to understand the governance of the WLD ecosystem and the potential impact on the value of WLD. While the World Foundation and Tools for Humanity are legally separate entities and have separate allocations, the decision-making authority governing when and how tokens are released may rest with a small group of individuals. The allocations and governance of TFH WLD and WF WLD are governed by arrangements that are not transparent to the public, and there is no autonomous on-chain code, third party reporting, audit or other objective processes that tie the statements made to the public to those actions of World Foundation or Tools for Humanity. With respect to WF WLD, it is unclear what the WF WLD release schedule is, but it is purportedly determined based upon the number of WLD users in the public. According to Worldcoin's blog, the decision as to when to release the WF WLD currently rests with the World Foundation's Board of Directors. The composition of the Board of Directors is disclosed as Chris Waclawek, Phillip Sippl, Weinberger Ventures GmbH and a Cayman Islands based professional director. It is not disclosed as to how they are compensated, and it is possible they are compensated in WLD. It is also possible that the Board of Directors and the World Foundation employees overlap with or are connected to Tools for Humanity. Because there is no transparency as to how the decisions related to the user-reward programs, airdrops and the release of WF WLD, there is a risk that they may act in their self-interest, including the risk of inequitable distribution, concentration of token ownership, self-dealing and acting on inside information. These risks are also applicable to the release schedule for Tools of Humanity. The release schedule for TFH WLD is a disclosed 5-year lock-up period (released daily, in a linear fashion). The unlocking of TFH WLD commenced in July of 2023 and will end in July of 2028. However, the original lock-up period was amended by Tools for Humanity from a 3-year period to a 5-year period in 2024 and there is no assurance that this schedule will not be amended again. The release schedule may be amended at any time at the discretion of insiders and without notice to the public. Tools for Humanity's and the World Foundation's executives, employees and investors are likely significant beneficiaries of WLD allocations. Releases of WLD could be made in ways that conflict with the interest of public token holders, including through accelerated releases during favorable market conditions or based upon internal funding needs. In addition, there could be a misalignment between insiders seeking liquidity and community members seeking network stability. These factors may disrupt market dynamics, depress or increase WLD prices, and create actual or perceptions of insider advantage that deter broader participation and have an adverse impact on WLD. Public materials indicate that the intent is for governance of WLD to be transferred to the WLD user community. However, there is no process as to how or when this will happen. As a result, the disclosed objective to create a decentralized autonomous organization for WLD may take significant time or may never be met. Given the conflicts of interest, the lack of transparency, and the risks of self-dealing, the value of WLD may decline significantly, even to zero. If the value of WLD were to decline, any negative decline could materially and adversely impact the Company's operations and financial condition and could result, in extreme circumstances, in the Company's insolvency.

Although our common stock is listed on Nasdaq under the trading symbol "ORBS," an active trading market may never develop or be sustained. A public trading market having the desirable characteristics of depth, liquidity and orderliness depends upon the existence of willing buyers and sellers at any given time, such existence being dependent upon the individual decisions of buyers and sellers over which neither we nor any market maker has control. The failure of an active and liquid trading market to develop and continue would likely have a material adverse effect on the value of our common stock. The trading price of our securities could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control, including our general business condition, the release of financial reports, and general economic conditions and forecasts. Broad market and industry factors may materially harm the market price of our securities irrespective of our operating performance. A decline in the market price of our securities could adversely affect our ability to issue additional securities and obtain additional financing. The trading market for our securities will also depend in part on research and reports that securities or industry analysts publish about us. If analysts downgrade our stock, publish unfavorable research, or cease coverage, our stock price and trading volume could decline. For continued listing on Nasdaq, we are required to comply with continued listing requirements, including the minimum market capitalization standard, the corporate governance requirements and the minimum closing bid price requirement, among other requirements. If we fail to satisfy these requirements, our common stock may be delisted. If we are unable to remain listed on Nasdaq, our securities could be quoted on the OTC Markets, and we could face significant adverse consequences, including limited availability of market quotations, a determination that our common stock is a "penny stock" requiring brokers to adhere to more stringent rules, limited news and analyst coverage, and a decreased ability to issue additional securities or obtain additional financing.

Our Certificate of Formation authorizes us to issue one or more series of preferred stock with voting, liquidation, dividend and other rights superior to the rights of our common stock, without stockholder approval. The potential issuance of preferred stock may delay or prevent a change in control of us, discouraging bids for our common stock at a premium to the market price. Our Certificate of Formation, Bylaws and Texas law also contain provisions intended to deter coercive takeover practices, including rules regarding stockholder proposals, the right of the board to issue preferred stock without stockholder approval, the ability of directors to fill board vacancies, a classified board of directors, and a provision that directors on a classified board may be removed only for cause. While intended to protect stockholders from coercive or unfair takeover tactics by requiring potential acquirers to negotiate with the board of directors, these provisions could delay or prevent acquisitions that stockholders may consider beneficial and may prevent or discourage attempts to remove and replace incumbent directors. Your percentage ownership in our company may also be diluted in the future because of equity issuances for warrant exercises, acquisitions, strategic investments, capital market transactions, or otherwise, including equity compensation awards that we grant to our directors, officers and employees. These awards would have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock. In addition, our board of directors may create and issue preferred stock having powers, preferences and rights that may dilute the voting power or reduce the value of our common stock. These anti-takeover and dilutive provisions may also limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could affect the price that some investors are willing to pay for our common stock.