Bullish (BLSH) Q1 2026 Earnings Report, Transcript and Summary

Thank you for standing by. At this time, I would like to welcome everyone to the Bullish Global First Quarter 2026 Earnings Call and Q&A. [Operator Instructions] I would now like to turn the call over to Michael Fedele, Vice President of Finance. You may begin.

Good morning, and welcome to our first quarter earnings call. I'm Michael Fedele, Vice President of Finance, and I'm joined on today's call by our Chief Executive Officer, Tom Farley; Chief Financial Officer, David Bonanno; and Director of Corporate Development, Liam Foley. This call will contain forward-looking statements, including those relating to our expected performance and business opportunities, our proposed acquisition of Equiniti Group, the anticipated benefits and strategic rationale of the transaction, expected timing and closing conditions and business opportunities following the transaction. These statements are not assurances of future performance and are subject to risks and uncertainties that could cause actual results to differ materially. Such risks include, among others, the possibility that the Equiniti transaction may not be completed, failure to obtain required regulatory approvals and the possibility that anticipated benefits may not be realized and risks related to the integration of Equiniti's business. For more details on these and other risks, please refer to today's earnings press release and our SEC filings, including our 20-F dated March 9, 2026. We undertake no obligation to update or revise any forward-looking statements. This call will also include a discussion of non-IFRS financial measures. A reconciliation to the most directly comparable IFRS metrics can be found in our earnings press release and presentation, which also contain additional information regarding non-IFRS financial measures and key performance indicators. I'll now turn the call over to Tom.

Thanks, Michael. Good morning, everyone. Thanks for joining. I'm Tom Farley, Chairman and CEO of Bullish. I'm going to lead today with the most significant strategic milestone in our history, our agreement to acquire Equiniti, a leading global transfer agent before turning to our first quarter results. For those of you who have followed our calls closely, first of all, thank you. You'll remember that I spoke at length during our Q3 call about tokenization and how we would grow our already successful stablecoin tokenization business. I'm sure some of you was thinking those -- during that call, what is this guy talking about? Tokenization is only part of their existing business and he's spending quite a bit of time on it. Well, for those of you who know Dave and me, one of our favorite expressions is promises made, promises kept. On these earnings calls, we will give you an idea of where we are headed as a public company, and then we will go there. On May 5, we announced a definitive agreement to acquire Equiniti for $4.2 billion, creating a tokenization powerhouse with an end-to-end stack spanning origination, issuance, trading, liquidity and visibility, purpose-built for the blockchain era. I want to walk you through the strategic logic because this transaction is transformative, not just for Bullish, but for the broader evolution of capital markets. Capital markets move in infrastructure eras. We went from the paper era with physical certificates and manual ledgers to the electronic era, which delivered dematerialization, electronic settlement and ultimately T+1. We are now entering the blockchain era, which offers something fundamentally different, unconstrained programmable ownership through tokenized assets. Tokenization is the process of turning traditional financial assets into blockchain-based assets. It turns static assets into active infrastructure, assets that are always on, that settle instantly and that carry dynamic functionality embedded in the instrument itself. We've already seen this migration play out with digital commodities and with stablecoins, which now exceed $300 billion in market capitalization and many trillions in annual payments volume. The next wave is tokenized securities. The global securities market is a $270 trillion market cap opportunity. We are in the first inning. But the drivers of the deal thesis include 3 structural elements working in concert. First, an end-to-end tokenization services stack from token design and smart contract deployment through regulatory compliance, distribution, liquidity and research. Second, a unified transfer agent ledger, one source of truth that bridges certificated and tokenized shares, enabling real-time settlement without displacing existing market infrastructure like the DTCC, EuroClear, Clearstream, so on and so forth. And third, a broad base of blue-chip issuer relationships, public company client relationships, the ability to go directly to issuers and say, hey, we can do this for you seamlessly with no listing change, no vendor switch and day 1 compatibility, including the ability to embed smart contract logic in share issuances. We at Bullish have already been building the first element for many years, the technology and the market infrastructure, in fact, since our founding. We operate the exchange, the liquidity engine, the indices, the data, the research and the distribution platform. What we did not have and what no one in crypto or globally had were the second and third elements. A regulated transfer agent with direct relationships to thousands and thousands of public company issuers and a unified ledger that bridges TradFi and blockchain. Equiniti and more specifically, Equiniti plus Bullish offers exactly that. Equiniti is the transfer agent of record for nearly 3,000 public company issuers, including over 50% of the FTSE 100 and over 30% of the S&P 500. They serve 15,000 total corporate clients. They have 20 million KYC shareholder customers on their platform who are just a wallet address away from accessing the benefits of tokenization. They process over $0.5 trillion in payments, primarily dividend payments annually. Average transfer agent client tenure exceeds 15 years and average transfer agent client retention is approximately 99%. Equiniti operates in a duopolistic market characterized by high barriers to entry and deep institutional trust. Now let me share something that has reinforced our conviction even since the announcement 9 days ago. The volume and quality of inbound interest has been extraordinary. We have received scores of inbound inquiries from issuers interested in tokenization, financial services firms interested in liquidity services on already tokenized assets, technology partners interested in building on our combined platform and even regulators seeking us to tokenize in their jurisdiction. The breadth of interest spans our exchange, our liquidity services business and, of course, the tokenization opportunity specifically. This is exactly the kind of market validation we hoped for, we anticipated even. But frankly, the pace has exceeded our expectations. We are clearly building something with strong end market demand today. Why is it that our acquisition announcement has been so compelling to the leaders of our industry and the leaders of our potential customers. It is for one primary reason. Industry participants realize the obvious. Only the issuer, the public company itself, can allow for tokenization of public company equity that results in the token being the actual share of stock in that particular company. If anyone else attempts to "tokenize," they are creating something other than the actual stock. This goes for electronic brokers, crypto platforms, traditional brokers, settlement providers and clearing providers. The transfer agent defines the legal ownership in partnership with the issuer. The token is the share. Without a transfer agent, tokenization is synthetic, off register, it lacks legal standing and ultimately will be unacceptable to institutional capital. The resulting token in those circumstances is actually a derivatives transaction or a warehouse receipt or a more colloquial language, an IOU, all of which have complexity and counterparty risk. In tokenization performed by the transfer agent, however, tokens represent true legal title. This is the bridge between TradFi plumbing and next-generation digital asset rails, and this is what unlocks institutional adoption at scale. On the transaction itself, we are acquiring 100% of Equiniti for $4.2 billion. The consideration consists of approximately $2.35 billion in newly issued Bullish ordinary shares and the assumption of $1.85 billion of existing Equiniti debt. Siris, the current owner will receive 2 Board seats and retains a call option to acquire certain noncore Equiniti business lines that are excluded from all of our financial outlooks. We are targeting a close in January 2027, subject to customary regulatory approvals. I'd also like to take a moment to thank Frank Baker and the Siris team for sharing our conviction and excitement as we execute on our vision to become the global leader in tokenization. The combined company will be formidable. We will be the global tokenization leader, providing the base layer of tokenization services with the value-added services that ensure tokenization succeed. Dave will take you through more of the financial details of the combined company in just a few minutes. Before I shift it to Dave and before I shift to our Q1 results, let me say this. When Dave and I came to Bullish, we said we wanted to build the ICE of crypto, a diversified institutionally trusted infrastructure platform that would define how digital assets are traded, serviced and understood. With this Equiniti acquisition, we are building the bridge between traditional capital markets and the blockchain era. We are not trying to displace existing infrastructure. We are upgrading it, and we are doing so with the regulatory standing, now the issuer relationships and the technology to drive this transformation. This is a 20-year opportunity, and we're just getting started. Now let me turn to a qualitative review of Q1. Dave will take you through the financial results in just a moment. On the exchange side, our business continues to gain traction. We traded $11.6 billion in options market volume during Q1 and have built our open interest share to 14% of the global Bitcoin options market, making Bullish the clear #2 exchange globally for Bitcoin options. In April, we hit a single-day volume high of $858 million, and we signed several new clients, including, for example, Ripple Prime, QCP and others. We're building a world-class derivatives franchise and continue to be excited by our progress. We also recently filed last week to officially receive our futures and options exchange and clearinghouse licenses, known as DCM and DCO licenses, which will help us expand our derivatives products to the United States. We continue to make progress towards attaining licenses to facilitate trading of securities on both sides of the pond and remain on track to receive European U.S. licenses prior to the end of 2026. Our liquidity services pipeline remains robust. In Q1, we signed Metso, and Valmet and others, and we have carried that momentum into Q2. CoinDesk continues to extend its leadership position. Total page views were up 30% and monthly unique visitors surged roughly 60% higher quarter-over-quarter. CoinDesk progress is continuing into the second quarter. Our visits were up 82% year-over-year in April. CoinDesk Indices now serves as the benchmark for Morgan Stanley's BTC ETP, MSBT, sorry, 3 acronyms and soon to be launched E and Solana ETPs slated to launch in the coming months. MSBT commenced trading on April 8 and swiftly amassed over $220 million in AUM, one of the more successful ETF launches in history. This is particularly exciting given Morgan Stanley's $7 trillion wealth management platform, servicing over 17,000 financial advisers and wealth professionals. On the event side, Consensus Hong Kong and Consensus Miami were each home runs, drawing a combined 26,000-plus attendees from more than 100 countries. Net ticket sales for Miami were 120% greater than sales for Toronto, and I can truly assess that Miami was a buzz with talk of our Equiniti acquisition and with enthusiasm around tokenization in general. I don't want to be the one to call the end of a bear market, but Miami certainly did not feel like a bear market. With that, I'll turn the call over to my partner, Dave, to walk you through our Q1 financial results in detail and provide additional context on the combined financial outlook.

Thank you, Tom, and good morning, everyone. This morning, we published our first quarter 2026 financial results alongside the 6-K filed with the SEC as well as our earnings press release and investor presentation available on our IR website. As a reminder, reconciliations of our non-IFRS metrics are included in today's earnings presentation and 6-K. Before discussing our financial results, I want to highlight that we will be providing a first half 2026 financial update on Equiniti during Bullish's next earnings update in a few months from now. Additionally, before concluding my remarks, I'll spend a little time reviewing the previously disclosed outlook for the combined company that we discussed last week at our Consensus event in Miami. Now turning to 1Q 2026 results, starting on Page 11 of the presentation. Total adjusted revenue for the quarter was $92.8 million, up approximately 49% year-over-year. Compared to 4Q '25, total adjusted revenue, adjusted transaction revenue and subscription services and other revenue all posted slight growth despite significant digital asset price weaknesses, including Bitcoin being down approximately 24% quarter-over-quarter. Our ability to grow all revenue line items quarter-over-quarter despite the significant macro headwinds is a testament to our diversified revenue model and organic growth profile of the business. Adjusted operating expense was $57.7 million in the first quarter, up from $48.1 million in the fourth quarter. That is an approximately $9.5 million increase, which includes roughly $7 million of expenses related to our Consensus Hong Kong event largely contained in the advertising and promotion expense line item. Of the remaining approximately $2.5 million of incremental expense, 50% was attributable to our investment in artificial intelligence tools across our entire business, including the expectation that we would announce the Equiniti transaction. The remainder was split about evenly across additional employee expense and the targeted performance-based awards I discussed when we provided our full year guidance back in February. Adjusted EBITDA for the quarter was -- excuse me, $35.1 million with an approximately 38% margin. This compares to 1Q '25 adjusted EBITDA of $13.2 million at a 21% margin. This year-over-year increase reflects an approximately 72% contribution margin. This despite increased Consensus-related expenses and increased investments that I just discussed. Adjusted net income was $20.3 million for the period or $0.13 per adjusted diluted share on a base of approximately 151.2 million adjusted diluted shares. This compares to adjusted net income of $28.9 million in the fourth quarter of '25 and $2.1 million in Q1 2025. Finance expense was $14.1 million in the first quarter, modestly below Q4's $14.9 million. Regarding our previously provided full year 2026 guidance on Page 22 of the presentation, we are reaffirming all of those ranges for the full year. Additionally, I would like to highlight a little more context on our expectations for adjusted operating expenses as we move through the remainder of the year. First, as noted on Page 22, we expect full year 2026 adjusted operating expense between the midpoint and upper end of the range as we accelerate investment in our tokenization platform. This slightly elevated spend is essentially the pull forward of future platform investment included in our net cost reduction guidance of $25 million to $50 million post closing of the Equiniti transaction in early 2027. Second, I'd just note that we expect the second quarter '26 to be our highest quarterly expense level during the year, driven by spend related to our highly successful Consensus Miami event last week. Hopefully, this additional context helps everyone sharpen their pencil a bit on the cadence of the cost base as we progress through the remainder of 2026. Before turning it back to Tom and beginning the Q&A, I want to provide a quick financial refresh regarding our outlook for Bullish on a combined basis as covered on Page 22. First, we expect the pre-synergy combined 2026 adjusted total revenue outlook of between $1.25 billion and $1.35 billion, adjusted EBITDA less CapEx between $490 million and $530 million and adjusted net income between $270 million and $290 million. Turning to Page 23, covering our medium-term outlook as compared to the combined 2026 financials, we expect approximately 6% to 8% annual revenue growth, $25 million to $50 million in net cost reductions and EBITDA less CapEx growing at approximately $100 million per year. Additionally, we expect to generate approximately $1 billion of free cash flow over the medium-term period and exit 2029 with about a 50% EBITDA less CapEx margin. Please refer to last week's announcement presentation and today's slides for additional detail on this outlook. And with that, I'll turn it back to Tom for closing remarks.

Thanks, Dave. We've delivered a strong Q1. We've announced a deal that fundamentally reshapes our company, and we're excited to keep executing and proving out our thesis. The positive market response from our current and potential clients from the industry over the last week or so certainly helps. With that, I'll ask the operator to open the line for questions. Thank you, everyone.

[Operator Instructions] And your first question comes from Owen Lau with Clear Street.

Could you please talk about the time line of getting your DCO and DCM license? Does Bullish have any plan to get into traditional equities, commodities and metal derivatives trading, which Tom, you have a lot of experience on.

Thanks, Owen. Good to hear from you again. Having been in that world now for most of my career, I can tell you there's a lot of tea leaf reading in estimating a regulator's response time. The good news is we are already, as you know, Owen, regulated by the most stringent regulators in the world, including the SEC, but also BaFin in Germany, the SSE in Hong Kong, the New Yorkers here with the BitLicense, so on and so forth. So that gives us a good bit of credibility. I also think that the regulators tend to look favorably on our management team given that we've kind of been there, done that with running really important regulated businesses with good hygiene, good compliance and regulatory hygiene. With all that said, to give you a more specific answer, the DCM and DCO licenses really range in terms of the timing. But we have seen with this CFTC a lot more alacrity, and we're seeing full approvals come for DCOs in under a year. I'll put it like that, Owen. I don't want to be too aggressive with what I tell you. And you can look up and see -- you can kind of do the research and see what I'm describing. But so far, we've -- everything has gone well and our conversations with CFTC have gone well. I've spent time with the Chairman and the heads of the various divisions, and it feels great. It feels good in terms of the start here. To answer your question directly, this DCM and DCO positions us in a couple of different ways, Owen. In general, we believe that this whole tokenization thing is going to take off as you know. And having the U.S. licenses, the appropriate U.S. licenses, and it's not just the DCM and DCO, but we will also be filing our broker-dealer license, I believe, this month here in May, which typically has a shorter window for approval than the DCM and DCO. Those collectively will give us the ability to trade on a secondary basis, these tokens as they come to market. So it really helps us with the kind of full stack pitch to firms as they're contemplating tokenization. And not only can we list them for trading, but we can also help them with their liquidity and help them with their visibility through CoinDesk and Consensus. So it kind of perfects the offering. But also just more tactically, if you think about the -- what I'll call the old Bullish stand-alone business, this enables us to take an options market, which we have not been able to bring to the U.S. because we don't have that DCM and DCO and has gone from 0 to 14% market share, as you heard in the prepared remarks, in just 6 months, and it opens up the single largest market in the world for us for options for data futures and perpetual futures just on our core kind of crypto derivatives franchise. So those are the 2 strategic reasons why we pushed ahead and done this. We have a great team that's worked on these applications and got them in, and I'm confident that we have a full package, and we'll be able to move through this process as expeditiously as possible.

Your next question comes from the line of Pete Christiansen with Citi.

Great event last week. And again, congrats on the Equiniti deal. Simple question here. The industry often, and we're hearing it from a number of sources here that demand for tokenized securities is large, but -- when we talk about the issuer side of the equation, I feel like their voice isn't as hurt as much. From your perspective, what do you believe becomes compelling enough for existing public company CFOs to actually change their shareholder infrastructure that some main question is already functions pretty reasonably today. Just helpful if you could give us your view of the other side of the equation here.

Yes. Pete, I love this question. It really gets to the heart of the matter. And I guess if I can do a little couch time here with this broad audience, when I've had my doubts, it's been exactly around this issue, which is what's going to be the catalyst from this to really take off and to see that $270 trillion global securities market dip. And I will tell you, Pete, that even in the last week, it's just all the potential fears or insecurities we have around that have been blown to smithereens. We've heard from Dow companies that they want to get on the path of tokenizing their stock and they want to do it pronto. We were -- I was tabulating last night the number of inbounds that we've gotten from issuers, but also partners who work with issuers and literally lost count. It's in the dozens and dozens, just in the last week. And so that alone gives us great comfort, and that's probably what you can hear in our tone. To get down to kind of brass tax, for the issuers, the benefits are both their own benefits, but also the benefits for the investors and a happy investor makes for a happy issuer does it ultimately reduce the cost of capital. And so from the issuer's perspective, they realize very quickly that tokenization gives them a lot more visibility into who owns their shares. But even if it's there's privacy and obfuscation around who owns the shares, how often are they trading? How long are people holding their shares? Are these buy-and-hold shareholders? It gives them the ability to reward buy and hold shareholders. You can imagine structures where dividends, rewards, buy and hold behavior. And so if you go talk, Pete, to the IROs and the CFOs of public companies, which I've done most of my career, frankly, the #1 thing they will tell you is they're in the dark that the nested infrastructure that's built up in this country over 200 years means that they get very, very little information. We live it as a public company. It's almost comical how little information we get about our own shareholders. So the tokenization, the promise of more information is very, very compelling. On the investor side, it's going to give the investors much more opportunity to trade, for example, 24/7. So imagine you're a large investor in Asia interested in trading U.S. securities. It will give investors more options in terms of lending and borrowing their shares and pledging their shares as collateral. And so if you're making investors happy, you're also making the issuers happy. But the thing I just set you at ease with is what's really set me at ease as well because like the thing Dave and I have said publicly, but I'll repeat it again, the only question here is how quick will the adoption curve be. And we made a conservative assumption when we put out figures last week, quite conservative, as you can see yourself, Pete. And in the last week, what we realized is, oh, boy, there's the opportunity this thing is going to take off real fast. And it's because of that groundswell of support that we've gotten on the transaction and interest in tokenizing shares.

And Pete, I'll just add a little bit from my seat as the CFO. I do think the person purchasing transfer agent services and tokenization services in the future will be the CFO. Q4, the transfer agent service was largely a tax for no value add. It was required by law, but you didn't see it. You never really sure what functionality it provided you and it was handled by your legal team and probably someone down the wrong in the legal team. 24/7 price discovery, access to new buyer bases and any modicum of incremental visibility into my shareholder base is worth substantially more than the product I pay for today at Equiniti. I feel deeply convicted about that, and I look forward greatly to discussing this with all the CFO issuers of the world, frankly. And I do think that this product is going to have instant traction from what we've seen. We need the Equiniti venues to catch up. We are pursuing, as Thomas mentioned, 2 different licenses to enable Bullish to trade securities in our single global order book and unified account structure around the world. We expect both of those licenses to be obtained during the course of 2026. We also expect third-party trading venues, both here and possibly abroad as well to begin during this year. And so we think the liquidity problem and the 24/7 price discovery promise will be fulfilled in the not-too-distant future, followed by incremental visibility into your shareholder base and then additional services and benefits that Tom just mentioned, which turn your stock into an asset it's never been before. And we're quite excited about the future. The inbounds we've gotten are beyond crypto-native companies. As Tom mentioned, we've spoken and gotten inbounds from industrial-type companies. So it's exciting. We look forward to getting back to work and building the future of tokenized equities.

Yes. I want to give you one last example, Pete. I know I'm going kind of full nerd on the market plumbing here. But going back to -- well, going back to my days at the New York Stock Exchange spending time with issuers, but frankly, going back to Monday when I was at the SEC, one issue that CFOs and Investor Relations is so-called naked short selling. I know to many of us on the call, we -- analogies, how big of a problem is that? This is -- it is detested in the issuer community. And tokenizing shares instantly causes that issue to go away for those tokens. So it's just another example of where the transparency will really benefit the issuers.

Our next question comes from the line of Ken Worthington with JPMorgan.

I wanted to dig a bit into more of the SS&O line this quarter. It was flat despite the Consensus Hong Kong event this quarter. Can you give us the puts and takes in SS&O this quarter that kept revenue flat relative to 4Q levels?

Yes, Ken, I appreciate the question. As we discussed in February when we gave the full year guidance, we said in terms of the puts and takes on SS&O, the headwinds would include macro forces outside of our control, namely digital asset prices. As I mentioned, Bitcoin was down 24% quarter-over-quarter. Every other digital asset was down far worse than that. Additionally, interest rates, which do affect some of our stablecoin-based revenues were also down 10%. And finally, I mentioned the selective discontinuation of legacy liquidity service offerings that originated from approximately the 2023 time period that are no longer priorities for our business going forward. We took all of those headwinds instantly in the first quarter. We got on with business with regard to focusing our resources around liquidity services we plan to continue providing into the future, did not renew most of the contracts or nearly all of the contracts that we intended to exit for the year. We absorbed the price immediately, and we absorbed the rate impact immediately. Despite all those headwinds, we were able to have Consensus Hong Kong, which is the smaller of the 2 events, helped more than offset that, and we were able to eke out a slightly positive sequential growth quarter, which all things considered in the current environment, we're pretty proud of. We can always do better. But we did absorb all the negative headwinds I discussed for the full year immediately in the first quarter.

Your next question comes from the line of Joseph Vafi with Canaccord Genuity. Your next question comes from the line of Chris Brendler with Rosenblatt Securities.

I'd like to ask on the U.S. expansion, sort of that wasn't that long ago that you were able to start soliciting U.S. clients. And it sounds like this tokenization initiative is very U.S. focused. So can you give us an update on your progress in building your U.S. client base and how this acquisition actually might accelerate that growth?

Yes. Kind of taking it in reverse order. The -- I just want to highlight that Equiniti is actually the market leader in the U.K. and has a presence in many countries. So if our message seems too U.S.-centric and may just be because it's coming from Americans who happen to be sitting in New York City. But this is truly a global opportunity that extends beyond the U.S. and includes both equities and debt securities. The U.S. initiative is going very well. As you -- as we've told you about on prior calls, the customers continue to ramp up. But perhaps the most exciting part of it is that now we're seeing a U.S. funnel or pipeline that includes some of the largest financial institutions in the world. Now the downside of that is it extends the sales cycle because these are firms that go through extensive diligence, reverse diligence compliance, regulatory, and we can stand up to the scrutiny, but it takes time. But our U.S. launch that we started just post the IPO back in the early fall is moving a pace just as we expected it would and perhaps slightly exceeding expectations.

Okay. Great. And then I had a follow-up. Can you just give us, I guess, a little bit of insight into the level of competition between Computershare and Equiniti. I feel like it's like a happy duopoly, but is there an opportunity as you add these services and potentially differentiate the platform as you take over, is there an opportunity for Equiniti to gain share in your mind?

Yes, great question. There's a little bit of back to the future for me, having spent many years leading the New York Stock Exchange. It's not an entirely dissimilar market structure. So I can speak somewhat authoritatively on it, even though we haven't closed on the transaction and still have several months here to get the deal completed. There is absolutely an opportunity to grow market share. In fact, we've received inbound from multiple customers from other transfer agents in just the last week who have acknowledged that having one unified transfer agent ledger. In other words, we don't have a crypto transfer agent working together with a traditional certificated share transfer agent, which introduces great complexity to the issuer. We have one traditional ledger has already been -- has been appealing message for us. I will say the retention rates for both Equiniti and competitors are fairly high in this industry. And so the battleground is often on new listings, IPOs and then slowly growing the share from the installed base, slowly. So this isn't something that's going to flip overnight from 50% market share globally to 75%. But clearly, we will have a better mousetrap, and we are going to accelerate our build efforts, our investment efforts. You saw a little bit of that, as Dave highlighted in the first quarter. And if I can editorialize for a second here, I know it's going to sound like an elliptical answer. I wanted to give everybody a sense of the context here. It became clear to us and frankly, to many in the industry about a year ago that the unlock here for tokenization is the transfer agent. And the reason is the transfer agent works hand-in-hand with the issuer and only the issuer, only the issuer. If you remember one thing from this earnings call, please remember this, only the issuer can allow for a token to be the share of stock in the company. No one else can do that. And so when that really dawned on us as it dawned on others, Dave and I decided to zig when others were zagging, and we said, we need in one fell swoop to have a unified transfer agent ledger and thousands and thousands of issuers. And so this Equiniti deal has been in the works since the week of Labor Day 2025. And in fact, we've been moving towards an announcement in earnest here most of 2026. And so we have been investing in our capability to acquire these assets, integrate this business, do it in a thoughtful way and preparing for this day for many months. This isn't something that was flash or came out last week. And so you're seeing those investments, and we will be prepared.

Your next question comes from the line of Joseph Vafi with Canaccord Genuity.

Do you think you could frame -- it's early days, but the revenue opportunity coming from an issuer that is obviously on Equiniti today that would add a tokenization option on their equity and how that may look just from an issuer perspective and then a broader ecosystem revenue opportunity play?

Yes. Joseph, can you just reask the first part of the question? Are you just saying like how far is the day when somebody can have tokenized stock available? Is that right?

Well, not really. Well, more like if an issuer decides to provide a sleeve of their stock in a tokenized form, what does that mean for Equiniti Bullish from a revenue perspective, maybe providing that service? And then from there, what does it mean kind of in a broader ecosystem opportunity for the company, providing that stock service, both in traditional electronic and then tokenized form.

Yes, yes. No, excellent. Great question. I get it. It's kind of, hey, we're trying to build a financial model for something that's never been done before. Give us a little more context and contour around it. I'll just -- I'll let Dave offer a few words. I'll just highlight a couple of things. One, this is not pie in the sky or on the come. This has actually been done by a great public company called Bullish. So last week and part of why this announcement really resonated, the Bullish Board on Monday night voted to tokenize the shares of Bullish. And in fact, we went ahead and minted, I think it was 151 million of shares on the Solana blockchain. And so we didn't so-call it kind of tokenize, as you called it, a sleeve or a portion or a single class of shares. We just tokenized all of our shares, which is to say we just added a characteristic to shareholdings, which is they can be in tokenized form. So you don't have to ask -- if you're a Bullish shareholder, you don't have to ask, hey, can you please go through some cumbersome process to tokenize your shares. They're all tokenized. And if you want to withdraw them, you can withdraw them. And it's on the Bullish Investor Relations website. What Dave highlighted earlier that I'll highlight again, the thing that will grow very, very rapidly in 2026 is the ability to then do some very interesting thing with those tokens. That's the beauty of blockchain technology. And for those of you who haven't gone down the rabbit hole, the programmability and the composability are what create endless opportunities for what you can do with those tokenized shares. I haven't even mentioned on this call the rise of AI agents and the intersection of tokenized shares with AI agents. But it's hard for any of us to comprehend exactly how powerful that combination will be. Just think back 2 years ago for the very first time you logged into ChatGPT versus what you can accomplish now with Claude Cowork. So when you think about, hey, what will be the precise financial model here I'll just start by saying it's very difficult for us to enumerate all of the opportunities for us to grow our financial model in really exciting ways. At a base level, can we charge for tokenization services to the issuers? Of course. Can we make incremental money from trading tokenized securities on our platforms where we're approved on both sides of the Atlantic? Obviously. Will we be able to add liquidity services to help these tokenizations be successful, much like we offer liquidity services for stablecoins, which are simply the tokenized U.S. dollar so that they can be successful? Of course. And this creates exponentially more opportunities to do so than the 40 or 50 stablecoin issuers that are in existence today. We're talking about global security issuers in the dozens of thousands all around the world. So those are the obvious ones that we can point to. But the less obvious ones are how are we embedding fee infrastructures and revenue models into ongoing trading of the tokenization or that intersection of AI agents or the intersection with DeFi platforms over time. There are some that we just -- it's kind of mind blowing, and we haven't yet put into our own financial models. And so I'm not going to try to convince you to do it in yours.

Yes. And Joe, I'd just highlight again, right, we stick by the guide for the medium-term outlook period of approximately 6% to 8%. But as Tom mentioned, a lot of these things are unfolding in real time. The existing transfer agent service, as I mentioned previously, is essentially a tax without any value add. It's a fairly low cost to a public company issuer. We believe that there's substantial value that will be provided via tokenization, and we can substantially increase the cost of the service without actually having it be terribly expensive at all for the issuer and still being very good value for money. When it comes to the larger parts of our business away from just the specific TA revenue stream from the issuer for tokenizing their shares, Tom mentioned a lot of different angles that could flourish. I would just say that we see new opportunities with blockchain networks, stablecoin issuers, tokenized treasury issuers and even retail distribution partners similar to what we pursued on the spot trading side to enhance the revenue growth over time. We're working through all of those, frankly, in real time. And when we get back to the desk, that's what we're going to spend all of our time doing. And we look forward to keeping everyone updated as we move through the year on our progress.

[Operator Instructions] And your next question comes from the line of Ed Engel with Compass Point.

Just trying to expand on that last question. Do you have any information on revenue per institutional customer for your existing SS&O business or potentially range of that, that we could potentially kind of use as a guidepost as a long-term target for cross-selling some of the issuer Equiniti?

Thanks for the question. We haven't provided any specific disclosure on the exact number and average price cost of the liquidity services offering. I would note that there's a bit of a range, including larger scale industrial relationships such as our Solana collaboration, back to our regular way on-exchange liquidity services, which would be kind of a fraction of the revenue we generate from some of the more larger industrial partnerships with stablecoin issuers for our treasury, Solana network partners and others. We do see a large opportunity for liquidity services to be applied to the 3,000 public company issuers that Equiniti has and the additional ones that we intend to win over time. We're too early to begin sizing that opportunity. But as we mentioned and what we want to convey generally is we see the surface area for incremental revenue growth to be extremely large. And we plan on working through that over the course of the back half of this year. We look forward to updating everyone, and we have a clear line of sight into where we think the plan will land and more context and visibility that we can provide, we will do so.

Yes. And I would just...

Yes. Go ahead, go ahead. Sorry.

Yes. I mean we're a customer of Equiniti. And so we know what we pay, and we know what our liquidity services customers pay. And you're talking about like just 2 different -- we're just playing 2 different games. So our liquidity services deals often are 7 figures, whereas we're in the relatively low 5 figures for what we're currently paying for just kind of straight transfer agent. And so that's one of the beauties of this transaction is the ability to provide much, much higher value services such as our liquidity services to really ensure and enable that as these companies make this leap to the tokenized world and they take advantage of these real benefits, we're going to be able to provide this much higher value service to them, which they love. As you know, as we've talked about, our liquidity services customers are our happiest customers because the service is really quite valuable. So they will benefit from it. We will benefit from it in terms of a financial model.

That's great color. And then on the OpEx pull forward for some of the tokenization investments, how do you think about building versus buying here, especially just given how many startups in the space? Or is it too early to really M&A here? Or it sounds like you guys are focused on doing this internally?

Yes. It's kind of the way we look at everything. I'm sitting in a room here with Liam and Mike. We've probably looked at 250 companies. The problem we have, the darn problem we have, we are very disciplined buyers. and we have a great team of native blockchain, PhD engineers, par excellence, second to none in the world. So we can just do it ourselves. And so we never say, oh, we're going to go buy in this area, and we'll just put the product road map on hold. That's just not how we roll. We'd much rather build it ourselves and create an organic solution. But at the same time, we talk to everybody. And if somebody wants to believe in the vision and buy into the vision and be reasonable about the value of their own business, we're open to have the conversation. It's no different here. The nice thing is we've already been building essentially a transfer agent. We got the -- as we told you back in Q3, we got our own regulatory license. We weren't waiting for an Equiniti to come along. We already had the smart contract engineers and in fact, have had them from our founding. We are already building smart contracts. We're already bridging layer 1 to layer 2s. We are already doing tokenization services to stablecoins, as we've talked about many, many times with you in the past. And so we don't have to go buy anything. We're already a leader and in the lead transaction, but we're open to it, and we will continue to have those conversations.

Yes. And I'd just reiterate, as we go through time here, pursue our goals and our strategic ambitions, we will never be put in a position where we have to buy. That is what I reiterate time and time again around here. We will build and then you're not forced to buy and you're in a better position to buy when you want to. So we'll continue to pursue our ambitions through that lens. We will build. And if we want to buy, we'll be in a strong position to do it because we won't be beholden to any seller in an event that we have to buy. That will never happen to Bullish.

Sorry about that, Stephan. (sic) [ Ed ]. I appreciate you asking those great questions. I just want to once again say thank you to all of you. We'll be back next quarter sharing a lot more information, as Dave described, not just on Bullish but also on the pro forma company, including the strategic assets that we acquired last week, really give you a sense of where all that's headed both in 2026 actual results, but also kind of into the future. Thank you so much for being here. This is going to be super exciting. It's the most fired up I've ever been in my career. This opportunity to take the global securities market and put it on to a new programmable, customizable technology platform with tons and tons of benefits for issuers and investors is going to be a blast. Go Bullish.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.