BDCI 10-K & 10-Q changes, risk factors and insider trading

References in this report (this “Quarterly Report”) to “we,” “us” or the “Company” refer to BTC Development Corp. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsors” refer collectively to BTC Development Sponsor LLC and BTC Development Advisors LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

We are a blank check company incorporated in the Cayman Islands on April 3, 2023 and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination involving one or more businesses or assets. We intend to effectuate our Business Combination using cash derived from the proceeds of the Initial Public Offering and the sale of the Placement Units held in the Trust Account, our shares, debt or a combination of cash, shares and debt.

We have neither engaged in any operations nor generated any revenues to date. Our only activities from April 3, 2023 (inception) through MarchJune 31,30, 2026 were organizational activities and those necessary to prepare for the Initial Public Offering, described below, and, after the Initial Public Offering, identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination, at the earliest. Subsequent to the Initial Public Offering, we generate non-operating income in the form of interest income on marketable securities held in the Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the three months ended March 31,June 30, 2026, we had net income of $1,701,548,$1,868,465, which consisted of interest earned on marketable securities held in Trust Account of $2,242,309, $2,277,072, partially offset by formation, general and administrative costs of $540,761.$408,607.

For the threesix months ended March 31,June 2025,30, 2026, we had a net lossincome $35,626,of $3,570,013, which consisted of interest earned on marketable securities held in Trust Account of $4,519,381, partially offset by formation, general and administrative costs.costs of $949,368.

For the threesix months ended March 31,June 30, 2026, net cash used in operating activities was $537,350.$861,079. Net income of $1,701,548$3,570,013 was offset by interest earned on marketable securities of $2,242,309.$4,519,381. Changes in operating assets and liabilities used $3,411$88,289 of cash from operating activities.

For the threesix months ended March 31,June 30, 2025, net cash used in operating activities was $0. Net loss of $35,626$39,294 was offset by payment of accrued expenses through advances from related party of $27,680.$27,680 and payment of operation costs through advances from related party of $39,294. Changes in operating assets and liabilities providedused $7,946$27,680 of cash from operating activities.

At MarchJune 31,30, 2026, we had marketable securities held in the Trust Account of $257,254,864$259,531,936 (including approximately $2,242,309$4,519,381 of interest income). We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account, which interest shall be net of permitted withdrawals and excluding deferred underwriting commissions, to complete our Business Combination. We may withdraw interest from the Trust Account for permitted withdrawals. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete a Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

At MarchJune 31,30, 2026, we had cash of $1,448,349$1,124,620 held outside of the Trust Account. We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a Business Combination.

In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, our sponsors or an affiliate of our sponsors or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we may repay such loaned amounts out of the proceeds of the Trust Account released to us. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment. Up to $2,500,000 of such Working Capital Loans may be convertible into units at the option of the lender upon consummation of the Business Combination at a price of $10.00 per unit. The units would be identical to the Placement Units. As of MarchJune 31,30, 2026 and December 31, 2025, there were no amounts outstanding under the Working Capital Loans.

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of MarchJune 31,30, 2026. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

The preparation of unaudited condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the unaudited condensed financial statements, and income and expenses during the periods reported. Making estimates requires management to exercise significant judgement. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited condensed financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could materially differ from those estimates. As of MarchJune 31,30, 2026, we used a third part valuation expert to estimate the fair value of the Public Warrants, and did not identify any other accounting estimates.

We accounted for the Public and Placement Warrants issued in connection with the Initial Public Offering and the Private Placement in accordance with the guidance contained in FASB ASC Topic 815, “Derivatives and Hedging”, whereby under that provision, the warrants that do not meet the criteria for equity treatment must be recorded as liability. Accordingly, we evaluated and classified the warrant instruments under equity treatment at their assigned value. Such guidance provides that the warrants described above will not be precluded from equity classification. Equity-classified contracts are initially measured at fair value (or allocated value). Subsequent changes in fair value are not recognized as long as the contracts continue to be classified as equity in accordance with ASC 480 and ASC 815.