Records first operating revenue from locking service and Super Validator operations

Completes sale of legacy biotechnology subsidiary Gravitas

NEW YORK, Aug. 14, 2026 /PRNewswire/ -- Canton Strategic Holdings, Inc. (Nasdaq: CNTN) ("Canton Strategic" or the "Company"), the first publicly traded company to leverage Canton Coin ("CC") to support the Canton Network's ability to digitize traditional financial markets, today released financial and operating results for the second quarter ended June 30, 2026.

"We are pleased to see our disciplined strategy and operational focus pay off with meaningful operating revenue recognized in the second quarter," said Mark Wendland, Chairman and Chief Executive Officer of Canton Strategic Holdings. "Since launching our strategy in November 2025, we have taken a diversified approach to value accretion, seeking opportunities to capitalize on commercial ventures that align with our long-term conviction in the Canton Network's ability to transform financial markets."

During the quarter, the Company recorded its first operating revenue, reflecting the initial contribution from its Super Validator operations and its locking-as-a-service ("LaaS") offering on the Canton Network, establishing the Company's base of revenue generating business operations. Notably, its LaaS offering drove revenue of approximately $1.3 million (see "Other Revenue" in financial tables below). This offering, launched in April 2026, supports Super Validators and Featured Applications who are required under Canton Improvement Proposals ("CIP") 0105 and CIP-0116 to maintain locked CC balances. Through this service, the Company locks its own CC on a customer's behalf while retaining legal and beneficial ownership, and is compensated through a stated interest rate, a share of the customer's network rewards, or an equity grant earned over the contract term, depending on the arrangement.

Separately, the Company's Validator and Super Validator operations drove $191,226 in revenue during this quarter, representing CC rewards earned for providing validation and liveness services to the network.

"Our Super Validator and locking-as-a-service operations reflect the active role we intend to play as the network scales, supporting the builders and validators driving institutional adoption of blockchain infrastructure," continued Wendland. "Our growing operating business, alongside our Canton Coin treasury, gives shareholders a differentiated way to gain exposure to the network's adoption, rather than passive exposure to a single token."

Quarterly Highlights (as of June 30, 2026)

• Secured approval for an expanded Super Validator weight of 15 under CIP-0102 and CIP-0114.  Active minting at 0.5 weight began in May 2026, with the remaining 14.5 weight scheduled to unlock in tranches through the first quarter of 2028 as the Company meets specific deliverables and receives approval from the Canton Foundation's Accountability Committee. Importantly, a higher weight indicates a proportionally larger claim on the CC minted to Super Validators.

• Launched its first commercial offering, locking-as-a-service ("LaaS"), to Canton Network Super Validators and Featured Applications. This model compensates the Company via a daily interest rate on locked CC, a share of network rewards, or an equity grant earned over a one-year term.

• Recognized revenue through diversified income streams, including $1,304,633 largely from its LaaS program, as well as $191,226 from its Network validation activities, for the three months ended June 30, 2026, the Company's first quarter generating revenue under its digital asset treasury strategy.

• Streamlined its operations through the sale of Gravitas Life Sciences, Inc. ("Gravitas"), the Company's legacy clinical-stage biotechnology subsidiary, on July 17, 2026, in exchange for an unsecured promissory note in the original principal amount of $3,500,000 bearing 15% payment-in-kind interest, plus contingent development milestone payments.

• Strengthened its governance through the election of Sean Galvin, Pamela L. Carter, and Rishi Nangalia as directors at the Company's 2026 annual meeting on July 13, 2026. Mr. Galvin, Ms. Carter, and Mr. Nangalia collectively bring deep experience across financial markets, public company oversight, and technology to the Company's Board.

• Created optionality for opportunistic share repurchases through Board approval of a $50 million share repurchase program on June 11, 2026; no shares were repurchased under the program during the period.

• Canton Coin holdings of 3,714,204,876 units with a fair value of $523,353,752, up from $501,760,369 as of December 31, 2025

• Cost basis of CC holdings of $584,064,579 as of June 30, 2026, compared to $523,770,731 as of December 31, 2025

• Cash and cash equivalents of $37,241,568 as of June 30, 2026, up from $12,007,148 as of December 31, 2025.

Financial Highlights (Three Months Ended June 30, 2026)

• Total revenue of $1,495,859 for the three months ended June 30, 2026, compared to $0 for the same period in 2025.
  
  
• Adjusted EBITDA of ($820,449) for the three months ended June 30, 2026 compared to ($1,126,984) for the same period in 2025.
  
  
• Adjusted Operating Expenses of $2,628,156, compared to $1,122,991 in the same period in 2025.
  
  
• Adjusted Operating Expenses Coverage Ratio of 56.9%, compared to 0.0% in the same period in 2025, reflecting the first recognized revenue in the current period.
  
  
• Net loss of $19,254,826, or $(0.08) per basic and diluted share from continuing operations, for the three months ended June 30, 2026.
  
  
• Unrealized loss on digital asset holdings of $23,735,950 for the three months ended June 30, 2026, reflecting a decline in the reference price of CC relative to the Company's weighted-average cost basis; the Company held no digital assets prior to November 2025.
  
  
• Total assets of $564,570,386 and total stockholders' equity of $454,902,612 as of June 30, 2026, compared to total assets of $519,146,435 and total stockholders' equity of $397,925,880 at December 31, 2025.

Business Update

Super Validator Operations

The Company operates as a Super Validator ("SV") on the Canton Network. SVs earn Canton Coin based on their approved "weight," which functions like a share count: a higher weight means a proportionally larger claim on the CC minted to Super Validators in each network round. Weight unlocks in tranches as the Company meets specific deliverables and receives approval from the Canton Foundation's Accountability Committee. Each unlock triggers ongoing per-round minting plus a one-time catch-up mint of rewards that had accumulated in escrow while that weight awaited approval.

Active minting began on May 9, 2026, when the Company met the first of eight deliverables under CIP-0102. For the period from that date through June 30, 2026, the Company recognized Network validation revenue of $191,226 on its active 0.5 weight, its first revenue from Super Validator operations, which included a one-time catch-up mint of rewards accumulated in escrow since January 21, 2026, when CIP-0102 was approved. As of June 30, 2026, the Company held total approved SV weight of 15 (4 under CIP-0102, 11 under CIP-0114) and an active weight of 0.5. The remaining 14.5 is expected to unlock through the first quarter of 2028 as follows:

If achieved on schedule, active weight would grow thirty-fold, from 0.5 to the full 15, by the first quarter of 2028.

Under CIP-0114, the Company's allocated SV weight is subject to quarterly review and a continuing requirement that the Company maintain CC holdings at or above the applicable CC Quantum established under the program. Assuming that requirement continues to be satisfied, 50% of the applicable allocated weight becomes eligible for release following the first quarterly review, and one-fourth of the remaining 50% becomes eligible for release at each of the next four quarterly reviews.

Locking-as-a-Service

Canton Network rules (CIP-0105 for Super Validators, CIP-0116 for Featured Applications) require those participants to keep a minimum amount of CC locked to maintain their status and reward eligibility. Through its LaaS offering, the Company locks its own CC on a customer's behalf so the customer can satisfy that requirement without sourcing CC itself. The Company retains full ownership of the CC throughout; only a wallet identifier, not custody or title, is shared with the Canton Foundation for compliance verification. LaaS launched on April 23, 2026.

Non -GAAP Measures of Financial Performance

In addition to financial measures presented under generally accepted accounting principles in the United States of America ("GAAP"), the Company evaluates performance using non-GAAP financial measures including adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") and Adjusted Operating Expenses, and Adjusted Operating Expenses Coverage Ratio.

Adjusted EBITDA

The Company defines Adjusted EBITDA as net income (loss), excluding income tax provision (benefit), stock-based compensation expense, unrealized gains or losses on digital asset holdings, and other non-recurring items. Management believes this financial measure provides a performance measurement that reflects our recurring core business operations. Adjusted EBITDA is provided in addition to, and should not be considered a substitute for, GAAP financial measures.

Adjusted EBITDA has limitations as a financial measure, should be considered as supplemental in nature, and is not meant as a substitute for the related financial information prepared in accordance with GAAP.

Adjusted Operating Expenses

Adjusted Operating Expenses is defined as GAAP total operating expenses minus stock-based compensation expense, which the Company believes is not indicative of its ongoing expenses. The amount and timing of the excluded items are unpredictable, are not driven by core results of operations, and render comparisons with prior periods less meaningful.

Adjusted Operating Expenses Coverage Ratio

Adjusted Operating Expenses Coverage Ratio is calculated as Adjusted Operating Expenses divided by total revenues.

The following table reconciles Adjusted EBITDA to net loss, its most directly comparable GAAP measure for the periods indicated. It also reconciles Adjusted Operating Expenses to operating expenses, its most directly comparable GAAP measure for the periods indicated.

About Canton Strategic Holdings, Inc.

Canton Strategic Holdings, Inc. (NASDAQ: CNTN), is the first publicly traded company to leverage Canton Coin and support the Canton Network to advance institutional blockchain adoption and the digitization of financial markets. In addition to its operating business that drives value through activities on the Canton Network, the Company is a strategic investor in the Canton ecosystem. For more information, visit www.cantonstrategic.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains statements about future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, which may constitute "forward-looking statements" within the meaning of the U.S. federal securities laws. Such statements include, but are not limited to, goals and expectations regarding the Company's strategy and potential partnerships, future financial and operating performance, projections or statements of plans and objectives, and other statements accompanied by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words, but the absence of these words does not mean that a statement is not forward-looking.

These forward-looking statements are based on current expectations, estimates, assumptions, and projections, and involve known and unknown risks, uncertainties, and other factors—many of which are beyond the Company's control—that may cause actual results, performance, or achievements to differ materially from those expressed or implied by such statements. Important factors that may affect actual results include, among others, the Company's ability to execute its growth strategy; its ability to raise and deploy capital effectively; ability to raise capital through on the Company's at-the-market offering; developments in technology and the competitive landscape; the market performance of Canton Coin; government regulation of cryptocurrencies; the Company's ability to achieve the deliverables required for future Super Validator weight unlocks; the developing nature of the Canton Network and the evolving legal and regulatory treatment of digital assets; the Company's limited history of generating revenue and other risks; and uncertainties described under "Risk Factors" in the Company's Annual Report on Form 10-K and in other filings with the SEC. These filings are available at www.sec.gov. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Canton is a registered trademark of Digital Asset (Switzerland) GmbH. Digital Asset is not affiliated with, and has not sponsored or endorsed, the operations of Canton Strategic Holdings, Inc.

Contacts
Media:
Gasthalter & Co.
(212) 257-4170
canton@gasthalter.com

Investors:
ir@cantonstrategic.com

X: @CantonStrategic
LinkedIn: https://www.linkedin.com/company/cantonstrategicholdings/
Website: www.cantonstrategic.com

SOURCE Canton Strategic Holdings, Inc.