Greetings, and welcome to Hyperion DeFi's Q3 '25 Earnings Call. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Jason Assad. Thank you, Jason. You may begin.

Good afternoon, and welcome to Hyperion DeFi's 2025 Third Quarter Earnings Call. Joining me today are Interim CEO, Hyunsu Jung; and CFO, David Knox. Before we get started, please note that our remarks today may include forward-looking statements. These statements are subject to risks and uncertainties, and actual results may differ materially. During this call, we may use words like anticipate, could, enable, estimate, intend, expect, believe, potential, will, should, project and similar expressions, which indicate forward-looking statements. For a more comprehensive discussion of these and other risks, please refer to our filings with the SEC available on sec.gov and in the Investor Relations section of our website at hyperiondefi.com. We'll also reference certain non-GAAP financial measures today. Please refer to our earnings release and earnings supplement on our website for a full reconciliation of these non-GAAP measures to the most comparable GAAP measures. We will start this morning's call with prepared remarks from Hyunsu and David, followed by Q&A. [Operator Instructions] I'll now turn the call over to our Interim CEO, Hyunsu Jung.

Thank you, operator, and good afternoon, everyone. Welcome to Hyperion DeFi's Third Quarter 2025 Earnings Call. Our first full quarterly earnings call since completing our strategic transformation from a biotech company to the first U.S. publicly listed digital asset treasury company focused on the Hyperliquid ecosystem. Now before I dive into our Q3 achievements, I want to acknowledge that this has been an extraordinary year for Hyperion DeFi. We successfully executed what I believe is one of the most significant corporate transformations in recent public market history, pivoting from Eyenovia's ophthalmic technology focus to establishing ourselves as a premier institutional gateway to DeFi innovation. Today, Hyperion DeFi stands as the first U.S. public company building a strategic HYPE token treasury. We're not simply holding digital assets. We're actively participating in the sustainable growth and governance of what we believe will become the backbone of next-generation financial services, the Hyperliquid blockchain. Our thesis is straightforward. Traditional finance is undergoing its most significant transformation since the advent of electronic trading. Hyperliquid represents the convergence of institutional-grade performance with decentralized innovation, offering up to 100,000 transactions per second with sub-second finality, all fully on chain. As institutions increasingly recognize the utility of blockchain adoption, we believe Hyperliquid's infrastructure advantages position it to capture significant market share in not only the extensive derivatives market, but also as part of its larger role as a sustainable layer 1 blockchain ecosystem. Let me briefly outline why our conviction on Hyperliquid is so strong and why we decided to establish a digital asset treasury focused on HYPE, its native token. All information is as of October 31, 2025, and based on external resources. Hyperliquid is the #1 revenue-generating blockchain and #11 cryptocurrency by market cap, both figures excluding stablecoins. Hyperliquid generates annualized revenue of approximately $1.3 billion…

Thank you, Hyunsu, and good afternoon, everyone. I'm pleased to join Hyperion DeFi as Chief Financial Officer and participate in my first earnings call with the company. My appointment became effective on September 29, so I've been able to observe our Q3 results from both an external and internal perspective. Having spent my career scaling financial services businesses at institutions like PayPal, SoFi and Cantor Fitzgerald, I believe Hyperion DeFi represents a unique opportunity to participate in the institutional adoption of blockchain technology. The company's strategic positioning and asset base are expected to provide multiple pathways for value creation that simply do not exist in traditional financial services. This was a very positive quarter for us. Let me hit the highlights. We achieved income from operations of $4.4 million and GAAP net income of $6.6 million, both of which are record highs for the company. This results in net income per common share on a basic and diluted basis of $0.26 and $0.05, respectively. We started the quarter with $45.5 million invested in HYPE tokens. We purchased another $20.0 million worth of HYPE, and we recognized GAAP accretion of $7.1 million this quarter. Separate from our treasury gains, our revenues from digital assets businesses, which we just launched in the quarter and are only beginning to scale exceeded $300,000. We also achieved $8.0 million of adjusted EBITDA, which removes some large nonrecurring tailwinds to the quarter, such as debt extinguishment, plus reverses some GAAP nuances on our liquid staking tokens, which otherwise would have resulted in additional mark-to-market gains in the quarter. I'm going to go through in detail our newly established key operating and financial results table, which is included on the first page of our earnings release and the third page of our earnings supplement, both of which…

Thank you very much, David. [Operator Instructions] Here's our first question. How did the crypto liquidation event on October 10 impact your business?

Yes. While October 10 was a very unfortunate event that created substantial economic losses for many market participants, it really demonstrated the resilience of on-chain smart contract platforms. So Hyperliquid's centralized exchange suffered 0 downtime or outages and the applications on HyperEVM, including lending and borrowing, worked perfectly without incurring any bad debt, which was not the case for other exchanges. More specific to Hyperion DeFi, none of our business operations were affected given that we have not taken on any leverage positions with our HYPE assets. As we mentioned before, our focus is on deploying natively staked HYPE to secondary yield-generating mechanisms such as HIP3. And we also saw more importantly, that even after this flush out of risk, trading volumes and associated fees quickly returned to Hyperliquid, which demonstrates market that there is demand for participants to continue to position their strategies on decentralized exchanges.

Thank you. What do you think of recent regulatory developments and their impact on DeFi and your business?

Yes, great question. So we are currently in an extremely dynamic regulatory environment that is broadly favorable due to the current administration. And we would expect to continue to see clarity around how crypto and DeFi will interact with existing financial infrastructure. The passing of the GENIUS Act, for example, encourages continued innovation in stablecoins under a more clear regulatory framework, which serves as a tailwind for the development of Hyperliquid native stablecoins like USDH. David, it would be great, too, if you want to add your thoughts here.

Absolutely, and thanks, Hyunsu. We place ourselves on the cutting edge of financial innovation. And because of that, we believe that we have a duty and an obligation to operate responsibly. This means choosing to operate in ways where we believe we can navigate various regulatory outcomes, and we welcome any additional clarity with regards to cryptocurrency, digital assets and DeFi regulation.

Thank you, David. This investor asks, are you considering an additional capital raise?

Great question. So after raising $50 million for our PIPE back in June, we moved very quickly to purchase HYPE and establish the foundations of our business, which, again, as a reminder, is our Validator and the development of the proprietary HAUS platforms and other additional initiatives to engage with and support Hyperliquid. Now these efforts support the growth of the ecosystem, and our focus is not simply buying and holding the assets, but to build and scale real businesses on chain. So we've established that foundation and the focus would be to continue to accumulate HYPE and refining what we've built. I'll hand it off to David here just with regard to capital markets activity.

Sure. Thanks, Hyunsu. We believe that HYPE is the most compelling digital asset and that over time, we are going to purchase more. As we think through how we might contemplate an additional raise and additional fundraisings, we're going to consider important financial factors like liquidity, like market conditions and like how we think we can deploy our HYPE tokens most effectively throughout our various business strategies. As mentioned previously, we did raise $21.8 million via our ATM in the third quarter, with which we bought back another $20.0 million of HYPE tokens and use cash for other purposes. And we have continued raising funds via our ATM in the fourth quarter.

Thank you, David. This one is on Aster and Lighter. They're asking, do you see it as a credible threat to Hyperliquid?

So there have been on-chain perpetuals markets before, like GMX and dYdX, and we expect that others may continue to come in the future. In our opinion, none of them are like Hyperliquid. So holistically, it is true that when a new entrant like Aster or Lighter join a market that is seeing a lot of attention, users may be interested in trying the shiny new thing. Competition is healthy because it encourages everyone to refine their product and be better, and it also helps the pie grow bigger, in this case, on-chain derivatives. But beyond this, Hyperliquid has done so many things differently. It's entirely self-funded with no VC capital. It's distributed over 30% of its token supply to early users. It remains credibly neutral. It's even refunded user funds when network issues have emerged. And more importantly, its rate of innovation is unmatched. It seems that those that are coming into the perpetual debt space now are playing a little bit of catch-up, whereas with Hyperliquid, with products like HIP3, which enable the permissionless launch of non-crypto assets and also aligned quota assets, it creates new demand things for HYPE and expands the universe of participants to Hyperliquid, and that's where we, at Hyperion see the opportunity.

Great. Thank you. Robert asked, is mNAV a useful metric to you?

So we believe mNAV was an appropriate metric during the first generation of digital asset treasuries when there wasn't a proper way to measure the value of the company besides the value of the assets in the balance sheet versus its market cap. We see this kind of changing now with new strategies from the, call it, the second generation of digital asset treasuries with strategies like staking, restaking derivatives. None of them, however, are able to do so far what Hyperion has done within the Hyperliquid ecosystem with real revenue-generating businesses built on top of our treasury asset HYPE. So not to reiterate the point too much, but the HYPE Asset Use Service products are ways of not only just earning the native staking yield, but compounding those returns through mechanisms that also support the growth of new products, expanding the user base to Hyperliquid and also onboarding and scaling financial activities. And so we see a world where companies like ours are actually measured by a combination of both the asset value and future cash flows.

Great. Thank you, Hyunsu. This one is regarding how do we -- what measures do we take to secure our tokens?

So self-custody infrastructure using infrastructure provided by Anchorage Digital Bank. There is also ways to utilize the native multi-sig offered on Hyperliquid to build secondary level protections on top of our existing HSM and MPC infrastructure. And it's our job to continue to diligence other service providers, infrastructure providers to ensure that we are always up to date and using the best mechanisms possible to protect the HYPE assets on behalf of the company and our shareholders.

How would we differentiate ourselves from other [ debts ]?

The simple answer is that we do not just buy and hold our treasury assets. It seems that staking to the network and contributing to security should just be baseline. Now Hyperion runs our own top 10 Validator with over 13 million HYPE stake to it, which does become real revenues for Hyperion. But more so than that, we have so many mechanisms to use that stake HYPE and redeploy it into the ecosystem. And these strategies not just compound yield and generate sources of revenue, but they also help create the flywheel effect that brings more users and activity to Hyperliquid. And as we mentioned before, with the Hyperliquid assistance fund, we have a precedent where the more fees and revenues that are generated within the ecosystem, 99% of them are going back to purchase back HYPE. And so we think this is a really powerful mechanism, and it's our role with Hyperion to continue to innovate financial products that enable this to continue.

Thank you. This one is regarding the Kinetiq airdrop. Is that baked into our forecast?

David, do you want to speak to this one?

Absolutely, and thank you for the question. So here is what we know. We have Kinetiq points. We believe we will be eligible for the token generation of airdrop. We do not know what the financial implications will be, nor do we have a reasonable basis to take a view on if it's going to be material or not material. But there's 2 important points that I want to make here. The first is we have not adversely positioned our balance sheet or our operations to try and take advantage of this opportunity. Our joint Validator agreement between us and Kinetiq and Pier Two is a top 10 Validator on the Hyperliquid blockchain with north of 13 million tokens as of the end of October, which is 60% month-over-month growth. In addition, the activities that we do with Kinetiq include our liquid staking HiHYPE token, which provides real utility to us in terms of being able to stake our HYPE, deploy into HyperEVM and use in off-chain situations like when we used HiHYPE as collateral for our Q3 covered call option strategy, which netted some profits in Q3. So this is why in our earnings supplement, we present these various business activities as compounding on top of each other, staking yields plus Validator commissions plus yield enhancement plus DeFi monetization plus ecosystem rewards. Because we really do believe that this all adds up together. And the second point that we want to make here, we don't know when or if there's going to be other opportunities like this, but we've only been doing this less than 6 months, and there's already been 2. The first was when the Hyperliquid Foundation delegated to our Validator 3 million tokens in the third quarter. And the second now with this Kinetiq rewards, for us, this shows that our flywheel effect is really beginning to work. We are building these businesses on the Hyperliquid blockchain, which both promote and monetize Hyperliquid's use. And now the ecosystem is rewarding us back. So this gives us even more conviction in our core thesis that HYPE is the most compelling digital asset, that the Hyperliquid blockchain is ripe for innovation and monetization. And we're very, very pleased to be simultaneously supporting and sharing in the upside of this growing ecosystem.

Thank you. Jonathan, one of our legacy shareholders asked, why have we not sold the Optejet?

Thanks for the question. Yes, with regard to the Optejet, we're taking a rational approach to that side of the business. It has commercialization potential. We maintain both patents and IP developed over the years. We are still completing R&D and testing to reach a position of commercial viability. So we've had a number of conversations with people in the industry, and we're taking it one step at a time. David, feel free to add some color here.

Thanks, Hyunsu, and that's right. All of our knowledge and conversations support our thesis that the best financial outcome for the company is to continue towards that next milestone of having an active registration and listing with the FDA. And in the fourth quarter, we've continued to do some testing towards that milestone. But we will continue to have a rational approach and evaluate options available to us.

Thank you. I think we have time for one last question. They're asking, are you going to hire more people?

So Hyperion DeFi's mandate is to continue to accumulate and generate revenue on what we believe to be the most compelling digital asset type, so that our shareholders can benefit from this comprehensive exposure to decentralized finance. Now to accomplish that, we must continue to operate responsibly and minimize cost on the operating side. So currently, we do remain fully supported across key business functions, and we want to remain very lean as we continue to move forward. Now the beauty of blockchain-based businesses is that similar to SaaS or other Web 2 products is that once they are properly designed, they are almost infinitely scalable. Hyperion DeFi has long-term ambitions far beyond simply operating in DeFi actually. Our goal is to become the bridge between institutional finance and on-chain financial primatives. And that's going to take time, and it's going to require a team of really some of the best-in-class people across industries, which obviously we've already started to build. And so a very long-winded way of saying it's definitely in the road map, but we want to focus on our core business first, which is ensuring that we develop a robust revenue-generating business lines within this DeFi space built on Hyperliquid.

Thank you. So this concludes the question-and-answer session. If you have additional questions that we didn't get to, please feel free to send them to ir@hyperiondefi.com. And we, of course, will be happy to get back with you. At this time, I'd like to now turn the call back over to Interim CEO, Hyunsu Jung, for his closing remarks.

All right. Thank you, Jason. As we conclude today's call, I want to emphasize the significance of what we've accomplished and what lies ahead. Q3 2025 was our first full quarter operating as Hyperion DeFi, and we believe the results demonstrate the viability of our strategic transformation. We believe our performance shows that a public company can successfully participate in DeFi ecosystems while maintaining institutional-grade governance and creating shareholder value. We believe our achievements this quarter were expanding our HYPE treasury to launching innovative revenue-generating services to appointing world-class financial leadership position us for accelerated growth in Q4 and beyond. We view the broader macro environment for institutional DeFi adoption as continuing to improve. In our view, regulatory clarity is increasing, institutional infrastructure is maturing and the performance advantages of platforms like Hyperliquid are becoming more recognizable. We believe Hyperion DeFi is positioned at the center of this transformation. Looking ahead, our priorities remain focused on 3 key areas: continuing to build our strategic HYPE position, expanding our portfolio of DeFi services and developing the institutional infrastructure necessary to bring traditional finance onto blockchain platforms. We're so grateful for the support of our shareholders throughout this transformation and excited about the opportunities ahead. Hyperion DeFi is building for the future of institutional finance, and we are just getting started.

Thank you, ladies and gentlemen. And with that, this does conclude today's teleconference. We thank you for your participation, and enjoy the rest of your evening.