DeFi Technologies (NASDAQ:DEFT) reported third-quarter revenue of $18.3 million and net income of $22.3 million as digital asset prices recovered and investors continued to add money to its Valour exchange-traded products.
Chief Executive Officer Johan Wattenström said trading gains and investment revaluations contributed materially to the results. He added that the company’s priority is to build more consistent earnings from fees and services.
Valour’s assets under management rose to $643.7 million at the end of September from $397.2 million at the end of June, an increase of more than 62%. The business recorded $26.1 million in positive net inflows during the quarter, bringing inflows for the first nine months of 2026 to $48.9 million.
Revenue and monetization improve
Third-quarter revenue increased from $7.8 million in the second quarter, bringing the nine-month total to approximately $37 million. Operating income was $7 million in the latest quarter.
Chief Financial Officer Paul Bozoki said the quarter-over-quarter revenue increase was driven primarily by $12.3 million in mark-to-market gains on cryptocurrency assets, less exchange-traded product liabilities. The company also recorded $7.7 million in mark-to-market gains on its venture portfolio, including its AMINA and Strategy preferred share investments. Those gains were recorded below the operating income line and contributed to net income rather than revenue.
Valour’s total assets-under-management monetization rate rose to 4.6% from 3.3% in the second quarter. Bozoki said the improvement brought the business back to profitability at a core operating level. He had previously estimated break-even at a 4.25% monetization rate on approximately $550 million in assets under management.
The effective yield from staking, lending and preferred share dividends rose to 3.6% from 2.4%. Bozoki attributed the increase in part to a full quarter of dividends from Strategy preferred shares. The effective management fee yield was approximately 1%, unchanged from the prior quarter.
Stillman Digital generated approximately $2.2 million in third-quarter trading commissions and $7.6 million in the first nine months, up about 22% year over year. Bozoki said quarterly traded volumes fell from previous quarters, although trading spreads held steady.
Institutional products move toward launch
DeFi is expanding beyond its listed products into strategies for professional and institutional investors. Its Smart Crypto Fund launched in September with approximately $10 million of the company’s own capital. President Andrew Forson said the fund had not yet attracted third-party capital and was building the operating and trading record prospective investors had requested.
Wattenström said the fund is managed by Neuronomics, a Swiss-regulated fund manager in which DeFi owns approximately 49.5%. Bozoki said the fund’s latest net asset value he had seen, from the prior week, was up approximately 1.8% since its September 21 launch. Wattenström cautioned that investors may want to see six to 12 months of live performance for the new strategy.
Forson said approval had been granted for the planned DVIO AMC, an institutional product intended to invest in 50 Valour exchange-traded products. It was awaiting final documentation for launch. He also outlined plans for a $250 million venture fund, while cautioning that preliminary investor interest should not be confused with committed capital or revenue.
Wattenström said the company had appealed a Swedish regulator’s denial of approval for its UCITS initiative and was pursuing an alternative EU jurisdiction. He expressed hope for approval by year-end or in the first quarter, subject to regulatory approval.
Balance sheet and share-price compliance
DeFi ended the quarter with $47.8 million in cash and cash equivalents, $5.6 million in USDT and USDC, and $48.2 million in digital asset treasury holdings. Its other reported holdings included $20 million in Strategy preferred shares, $25.5 million in venture investments and its $10 million Smart Crypto Fund investment.
Asked about liquidity, Bozoki said the venture holdings were less liquid because they involved private companies. He also said DeFi must maintain its Smart Crypto seed investment during a support period.
Wattenström acknowledged the decline in the company’s share price and said its recent market capitalization of approximately $130 million was below the $165.8 million in shareholder equity reported at September 30. He said management believed the valuation understated the business’s potential.
Asked about Nasdaq’s $1 share-price threshold, Wattenström said the company would conduct a reverse stock split before the early-March deadline if necessary to avoid delisting. He did not rule out a split for other reasons even if the share price recovered.
Costs and custody timeline
Bozoki said the company remained on track for 2026 cash operating costs of $36 million to $39 million, a reduction from the prior year. He noted that legal costs associated with a class action lawsuit were a burden. Vice President of Marketing and Communications Curtis Schlaufman said the company hoped to resolve the matter in early 2027.
Valour’s custody platform is now targeted for launch in the first half of 2027, after management had previously indicated the latter part of 2026. Wattenström said resources had temporarily been redirected to other infrastructure projects. The company plans to begin beta testing in the coming weeks and initially use the platform for Valour’s own operations.
About DeFi Technologies (NASDAQ:DEFT)
DeFi Technologies is a Canadian financial technology company focused on providing traditional investors with access to digital assets and decentralized finance. Its business includes exchange-traded products, institutional digital-asset services, research and trading activities. Through its subsidiary Valour, the company issues digital-asset exchange-traded products that give investors exposure to cryptocurrencies through traditional securities markets. Valour’s products are available on exchanges in multiple international markets, including Europe.
