Welcome to DeFi Development Corp's Q1 2026 earnings conference call. I'm Dan Kang, Chief Strategy Officer and Head of Investor Relations.

Joining me today are Joseph Onorati, Chief Executive Officer, John Han, our Chief Financial Officer, and Parker White, our Chief Operating Officer and Chief Investment Officer. As a reminder, we will be making forward-looking statements during this call.

Actual results may differ materially due to risks and uncertainties, which are outlined in our filings with the SEC, including our Form 10-K. Our latest shareholder letter was published yesterday, May 13th, after market close and is available on our website.

We will begin today by answering questions submitted by retail investors, followed by questions from the sell side. Joseph, Parker, John, thank you for joining us.

Happy to be here.

Our first question is from retail: "I invested in DeFi Dev Corp because of this mission statement: 'DeFi Development Corporation is a public company whose core strategy is to hold and grow a large reserve of Solana (SOL).' Can you tell me if this is still your core mission?"

Joseph?

Yes. The purpose of the company is to offer investors with leveraged Solana exposure, and we see some other DATs in the space trying to move away from being a DAT.

That's not us, we're leaning into it. If you read our investor letter and walked away thinking that we've taken our eye off the ball, then we haven't communicated well.

The reason we dove into experimentation in the letter is because we wanted shareholders to understand that everything we do from running validators to partnerships we make, on-chain deployment of the treasury, the Treasury Accelerator program, even APEX, is ultimately meant to amplify SOL accumulation. These aren't at odds with stacking more SOL.

If anything, they provide a differentiated avenue for accumulation that no other DAT is pursuing. Our mission's still the same: grow SPS as fast as possible.

At the end of the day, SPS, or SOL-per-share, is still the only number we measure ourselves against, and 108% trailing 12 months of growth is great, but it's just a start, and we think we have plenty of SPS growth ahead of us.

All right, thanks, Joseph. Next question: "At current SOL levels and staking revenue, will DFDV sustain two years of runway?

How concerned should we be of the OpEx and the debt service if SOL drops to say $60 or $40? Will the staking revenue keep the lights on to survive?"

John, you want to take this?

Sure. Happy to.

That's an excellent question and an important question, and it's one that's front and center for the entire DFDV team. All of us have lived through multiple bear and bull cycles, especially in crypto, we treat runway, capital allocation, and sustainability as core priorities.

We are confident that we have the funds to sustain operations for well over two years at current Solana prices and with the staking revenue. We run detailed periodic runway models specifically for these various scenarios, both for our internal purposes as well as for our auditors.

We are laser focused on reducing OpEx wherever possible to drive greater Solana-per-share growth, like Joseph just mentioned, our key KPI there. As we discussed in our shareholder letter, we do make selective, high-conviction bets on opportunities where we believe we can create meaningful value for our shareholders.

Many of those bets obviously do incur one-time costs. These are bets, but obviously they have costs.

Debt service, on the other hand, remains very manageable, and we maintain a very comfortable runway even if Solana prices were to fall 50% from here. That said, even if that did happen, we wouldn't expect such weakness to sustain very long.

We remain very bullish on Solana long-term. Thank you.

Thanks, John. Next question: "DFDV succeeds if Solana succeeds.

What are you doing to incubate, accelerate, and proliferate the expansion and adoption of SOL?" Parker, you want to take that?

Sure. I think this kind of comes down to two primary areas.

The first one is effectively marketing or storytelling, right? We continue to talk to investors and they understand Bitcoin primarily because of Michael Saylor.

We want to be, in our own way, the Michael Saylor for Solana, telling that story, being the evangelist. That's something that we've tried to do.

We've put out a number of pieces, long-form pieces, short-form pieces via our Twitter, our blog, some of the recordings that we host, lots of different avenues there. We continue to do more of that going forward.

The other area is through ecosystem development. We've historically done partnerships with all the major players across the ecosystem.

We plan to continue to support that kind of initiative over time. As new entrants come to market, we'll do additional partnerships to help bring focus and a spotlight to those projects.

We may use risk-managed portions of our balance sheet to help grow liquidity on some of these platforms, and ultimately, create an environment that others want to participate in because a regulated public entity is involved on-chain. It's ultimately the marketing and the capital deployment, and we plan to continue doing both to help support the ecosystem growth.

All right, thanks, Parker. Next question: "In addition to the recent rise of Solana's price, what other activities and/or investments have been made in the Solana ecosystem more broadly, and what positive news can you tell us about them which are actually adding value to the company?"

Parker, you want to take that?

Sure. On our side, we recently announced a partnership with Jupiter Lend.

That was a month or two ago. We are working on some additional partnerships.

We announced a partnership with Allied Architects in Japan as part of our kind of Treasury Accelerator program. We continue to make progress on DFDV UK.

These are a few of the initiatives that we're working on to, both directly and indirectly, help grow value for the Solana ecosystem and accrue some of that value back to DFDV. Additionally and more broadly speaking, there've been a number of positive developments on the Solana front.

You saw the recent announcement about Google and the payments API there, and so we're continuing to see more and more activity on the Solana side, both with RWAs and tokenized assets and other large institutions getting involved in the ecosystem. I think we're going to talk more about that in a little bit, but I think that's also germane here to what we're...

All right, thanks, Parker. Next question: "Is APEX related to DFDV or SOL?

As I understand it's only tied to Bitcoin. Do you expect the release of the governance token to be a catalyst for both DFDV and SOL?"

Joseph, you want to take this one?

Sure. We won't comment on the release of a governance token for APEX, but as outlined in the shareholder letter, we think APEX meaningfully improves the cost of capital for preferred equity fundraise for DFDV.

All right, thanks, Joseph. Let's turn to some sell-side questions.

This question is: "At Needham, DK, you discussed experimentation as a core part of DFDV's playbook. How should we think about the budget for experimentation going forward?

Is there a hard cap as a percent of treasury or balance sheet, or is it more opportunistic? When an experiment doesn't work, like DONT, at what point do you decide to cut it versus give it more time?"

I'll take this, guys. It's a good question.

I'll start with I guess the budget or call it capital allocation framework. There's definitely a waterfall of priorities, and any investment we make has to clear the bar of basically the ROI on buying SOL right here, right now, especially since we think SOL is eventually going to 10k, and it's why we've made what we outlined in our letter, the asymmetric bets that we have.

In each scenario, we model the upside, the downside, and in each of the scenarios that we outlined in the letter, the downside was fairly de minimis, but we believe the opportunities were magnitudes greater than the upfront cost or cash or SOL investment. Zerostacks is actually a great example.

Had that SOL sat there on our balance sheet, we would have earned the staking rewards and, of course, generated a return equal to the SOL price action over the last, call it eight months or so, but because of the way we structured the deal, we got a return well above our investment, got the staking rewards back as well, the economic cost to DFDV was effectively zero. I think there are numerous examples of this kind of playbook really paying dividends to us.

APEX is another fantastic example of us bringing a $400 million project to life in terms of TVL in just a matter of weeks with, again, a fraction of the balance sheet committed up front. These are a few examples.

Again, we're going to try to be as transparent as possible with shareholders with respect to both our wins and our losses on experimentation, but again, all of it is geared towards driving SOL-per-share growth in some capacity. All right, next question: "Can you give us a sense, one year later, of BONK's actual SOL-per-share contribution?

What kind of SOL-per-share growth would have occurred had you not announced this partnership?" I'll take this one again, guys.

Difficult to quantify. Shareholders can see how our equity reacted post-announcement.

I really think the attention and volume that that partnership drove was most key. Got us on the radar for crypto-native investors, showcased our knowledge of not just crypto, but its culture as well, and it literally tripled our average daily volume in the ensuing weeks, right?

It's difficult to pinpoint an exact SOL-per-share number, let's call it pro forma for that, but I think investors can do some back-of-the-envelope math on the impact just looking at what happened to DFDV equity in the ensuing days and weeks following that announcement. All right, next question: "The letter mentions you intend to keep experimenting and that some bets won't work.

How are you thinking about the threshold for disclosure? Will we hear about every miss the size of DONT, or only the ones above a certain materiality threshold?"

Joseph, you want to take that?

Sure. I think the materiality threshold is just a legal question, we check with our lawyers if something's material.

If it's material, we disclose it. If it's not and we think it's accretive to the business, then we'll disclose it.

We put DONT down as an example miss because it was very public, but it wasn't very expensive to launch the token, actually. From a pure dollar-cost perspective, it was just the legal costs, and then outside the dollar cost, it was the team's time to get it out there.

The upside potential, when we modeled it, was significant. Even if the company never intended to sell any DONT, the potential benefit to the business was in our view massive in comparison to the cost, and that goes to the point on asymmetric bets that DK's mentioned a couple of times now.

Also, I guess reflecting a little more on threshold for disclosure and what counts as a win or a loss and whether to disclose it or not, maybe this answer is not very direct, but quantifying some of these misses might not be straightforward. For example, in the BONK validator partnership, if it hadn't moved the stock price, would it have been a miss?

I doubt it. Setting up the validator was relatively low-cost, we probably actually generated revenue on the partnership, not much, but some.

Even if the stock price didn't move, I don't know if that one would be a failure. Maybe overmusing there.

Cool. Thanks, Joseph.

Next question: "Thanks for the framing around Treasury Accelerator. Can you walk through some of the key milestones you're looking for on Allied Architects and DFDV UK, and when we might see the SOL-per-share contribution?

Is this a next six months or next three-to-four years kind of thing?" Parker, you want to take that?

It's a good question. I think it's a little bit of both.

On an unrealized basis, you may see an impact in the next six months, but the intention for us is not to wrap up these deals in six months, sell all the stock, get out, right? The intention is for these to be long-term partnerships and growth opportunities for us.

We think that every major capital market in the world should have exposure to enhanced Solana, as DFDV provides in the US. That also may take some slightly different flavors in each market, but ultimately we're here for the long term with these partners.

I think you may start to see some benefit in the short term, but I think it will be tough to evaluate the full success on any month-denominated basis. It'll likely be many, many years, who knows, maybe a decade before we fully understand the totality of the impact here.

We're playing for the long term.

Thanks. I'd like to add to that.

The way I think about these deals for the Treasury Accelerator is in a bear market or a flat market, we're not going to see a lot of or significant SOL-per-share growth at the DFDV side for these relationships. In a bull market, when there's demand for SOL, SOL's ripping, because of these partnerships, we're able to offer additional leveraged exposure to Solana.

To maybe tighten it up, I think these deals have potential for outsized upside with limited or no downside.

Awesome. Thanks, guys.

Expanding on that a little bit further, doing some back and forth, the way I think about all of our experimentation is accumulating call options. I think in this case we now have a call option on Solana DATs in Japan, for example, or Solana DATs in the UK.

If we can acquire these call options for fairly minimal cost, of course call options aren't great in sideways markets, or down markets, but in up markets, they have levered upside payoff. That's essentially how we look at the accelerator program and also kind of most of our bets in general.

Awesome. Thanks, guys.

One more on Treasury Accelerator, specifically as relates to Allied Architects: "You mentioned Allied Architects has limited operating commitments. How should we think about what limited means in practice?

Is there a potential asset management agreement coming, and would that change the economics of the deal materially?" Parker, you want to take that?

Sure. Today there's no operating agreement in place.

We don't have operating commitments that would create ongoing costs. I can't discuss any future asset management agreements that may be implemented.

However, of course, if we were to sign on for additional costs, that would come with commensurate additional revenue and upside there. I'll leave it at that.

Thanks, Parker. All right, next question: "Would you consider running your ATM or selling SOL to repurchase any convertible debt?

Is this philosophy around convertible debt repurchase similar to the MSTR playbook, or are there different ways you're thinking about convert retirement? Are converts completely off the table as a future funding source?"

Parker?

Sure. Ultimately we want to maintain our flexibility.

This is a very dynamic space. MicroStrategy has not been around for that long, and they've changed the playbook several times already.

Just recently Saylor starting to discuss potentially selling some Bitcoin. I don't want to paint ourselves into a corner by saying we will never do something or we will always do something.

We evaluate these opportunities as they come along and look at the economics. Maybe an example: if the convert was trading at 5 pennies -- this is hyperbole -- if the convert was trading at 5 pennies and we could retire all of our debt for $6 million, yeah, maybe we'd sell a little bit of SOL if it was trading at $100 a coin to retire all of our debt.

Again, hyperbole, but we kind of look at all the opportunities as they present themselves and as the market creates opportunities. If we feel that something is mispriced, we may take advantage of that.

We do really prefer not to sell SOL to buy back debt. There may be some situations where it would make sense on a SOL-per-share growth perspective because these are convertible notes, when there's a buyback, it also does retire that future conversion.

This is not the base case, this is more of an exception. I'll kind of close out with that and just really highlight that optionality that we want to maintain because this is such a changing environment and all of these things, our common stock, SOL, convertible debt, everything else has a market price and those are always in flux.

Saying we will or won't do something today is tough to predict for the future.

Awesome. Thanks, Parker.

Next question: "Your leverage ratios are high given the pull back in SOL price. As you simplify the capital stack and lean into different issuances like preferred equity, what's the target leverage profile we should model, and how does that change in a downside SOL scenario?"

Parker, you want to take that?

Sure. Our long-term leverage target, we do want to target somewhere around 30%.

Now of course that's going to move around quite a bit as the price of SOL moves, and we really don't want to effectively be forced rebalancers to that 30% target, because that would require us to lever up in bull markets and delever in bear markets, which is the exact opposite of what you want to do for long-term SPS growth. Again, we kind of have this long-term target, and this should roughly be maintained in I would call it the midpoint if you will of market environments.

In the overly bullish environments, you would expect our leverage ratio to decline, and in the overly bearish markets, you would expect our leverage ratio to increase. Now that may be slightly due to our own actions, but largely it's going to be due to the market.

If the value of the balance sheet gets cut in half because SOL has a 50% pull back, well, the leverage ratio doubles without us doing anything directly there to contribute to that. We do want to target a prudent level of leverage, maintain some cash reserves to cover coupon payments or dividend payments on preferreds, that kind of thing.

There may be opportunities to slightly add some leverage in a bear market and slightly delever in a bull market, but generally speaking, we want to maintain that rough 30% target and allow the market to kind of change our leverage ratio for us.

Awesome. All right, next question comes from George over at Craig-Hallum: "Could you give us your updated thoughts on the key use cases for SOL, particularly any recent wins that embolden your conviction in the asset?"

Parker, you want to take this?

Sure. There's a lot of things here.

Interestingly enough, with the team launching a project on Ethereum, it's actually crystallized our bullishness on Solana from both a technology perspective and candidly a liquidity perspective. If you look across the Ethereum ecosystem outside of Ethereum Layer 1 or the base layer, SOL is a clear second place on liquidity.

None of the L2s on the Ethereum side really come close. There's some activity on say Hyperliquid, but Solana has a dominant number two position on the liquidity front.

On a technology front, Solana is a very clear winner. It's much easier to launch projects, to manage projects, it's just a better UX on Solana all around.

A few key themes that we're watching on the Solana front that are really exciting: first one is stablecoin growth. We're seeing pretty meaningful growth on that front and not just in TVL numbers and transaction volume numbers, which on the transaction volume side outpace all other chains.

The types of entities getting involved are pretty spectacular. We saw quite a while back Western Union, but there's a number of other large entities that are issuing stablecoins sometimes first and foremost and even only on Solana.

I think you're going to see that continue to happen. People in DeFi like to look at the total stables TVL of $300 or so billion and say, "Wow, that's so big," but in the grand scheme of global credit markets or global money markets, it's tiny.

I think as global stables TVL grows to let's call it $3 trillion, $5 trillion, $10 trillion, the $300 billion that we're at today is a drop in the bucket, and I think Solana is best positioned to capture the lion's share of that big, let's say $10 trillion TAM for money on-chain. Now a key reason for that is agentic AI and the x402 standard.

What we're seeing is the number of machine-generated payments and payments using x402 on Solana outpacing all other chains. That's just because it's just easier to send money on Solana, it's cheaper to send money on Solana.

Machines can pay, I like to say token for tokens on the agentic AI side. Agents can pay for LLM tokens with crypto tokens, with stablecoins, and you can send pennies and it still makes economic sense to send those small amounts.

They settle instantly and there's no permission required for an AI to have a wallet to send assets around. Another really big unlock that we're excited about is the Alpenglow upgrade.

The key change here is going to be finality times, bringing finality down to about 100 to 150 milliseconds. Just last week I believe it was, there were some tests that show that it's actually working.

Gearing up for the mainnet release hopefully here in Q3, and I think that'll be a real stepwise improvement because what that does is it moves Solana out of the realm of competing with other Web3 platforms and saying, "Well, Solana is the best blockchain." It's like, "Yeah, but blockchains are all kind of slow."

Actually what it does is it brings Solana on par with Web2 platforms. Now you might say, "Well, I could run my application using say an RDS instance on AWS, or I could run my application using the Solana blockchain," and they actually have about the same speed.

In fact, the Solana blockchain in some cases may be faster. All of the Web2 applications that we're used to -- snappy apps, immediate page transitions and button clicks just working -- that all is coming to Solana.

It's already great, but there's that kind of last little improvement that I think surprisingly actually is a stepwise function. This also opens up a whole host of additional applications on-chain.

The one that everyone likes to talk about is of course on-chain perpetual swaps, something like a Hyperliquid, but on Solana, because now Solana will start to compete with the centralized exchanges in terms of speed for a central limit order book. There's a whole host of these new applications that are unlocked with Alpenglow, and I think Alpenglow happens say in Q3, you'll start to see some of these applications be developed or migrated or upgraded, say in Q4 and then into 2027.

I think 2027 is going to be a real catalyst time for Solana from a technology perspective. Price may or may not kind of frontrun that, but on the technology side, we're very, very excited for the next let's call it two years.

The last thing I'd say that's very exciting is the RWA growth. We're seeing xStocks and some of the other equity issuance platforms really start to have legs, and you're seeing people trading metals on-chain, you're seeing people trade commodities on-chain.

There's just a bunch of exciting things that are happening there that I think we're just in the very, very early innings. I think people like Larry Fink at BlackRock say this, that ultimately all assets are going to be tokenized.

When we're sitting here saying, "Well, there's a couple hundred billion of tokenized RWAs if you include stablecoins, and there's maybe less than a billion of non-stablecoin RWAs out there, true RWAs, like tokenized stocks." This is just a tiny, tiny, tiny rounding error to zero relative to global assets.

I think you're going to see massive growth in assets being issued on-chain, and Solana is candidly the best place for it and is already winning that race. I think you're going to kind of continue to see that happen.

I'll add as we highlighted in the letter, 94% of all tokenized equity spot volume has settled on Solana, which is a pretty staggering figure. Parker, I'll note you missed a good chance to say if stablecoins are the ChatGPT of crypto, then Solana is Nvidia.

I saw a funny article the other day that actually showed Claude had a price target for Solana of $350 by the end of this year. I don't know if that's too bearish, but won't comment any further than that.

Is this the secret Mythos model giving us some price targets early?

All right, guys. We are at our last question.

This one is for Joseph: "Could you please address the increased focus on privacy networks like Canton and Zcash? Do you feel Solana loses any mandates given its transparency?"

Thanks. I'm pretty bullish on privacy personally, yes, I think non-privacy-focused blockchains are disadvantaged.

I think that's probably in the extreme long-term. On a long enough time frame, or even maybe a medium time frame for Solana, I expect there to be privacy layers or tools built on top of the chain.

Solana has got a great community of developers, problem solvers, and if the market demands privacy on Solana, then Solana is going to find a way to deliver it at scale. While I'm bullish on privacy, I'm not worried about this from a Solana perspective in the short term, certainly.

All right. That brings us to the end of our Q&A.

Thank you, Joseph, John, and Parker for your thoughtful responses as always. We thank all the listeners for tuning in to our earnings call.

Please do not hesitate to reach out to us if you have any additional questions. With that, in service of SOL-per-share growth, we will see you all next quarter.

See y'all.

Thank you.