Form S-1/A Athena Bitcoin Global


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Table of Contents

 

As filed with the Securities and Exchange
Commission on May 16, 2022

 

Registration No. 333-262629

 

UNITED STATES

SECURITIES
AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Amendment No. 2 to

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

Athena Bitcoin
Global

(Exact name of registrant as specified in its
charter)

 

Nevada 6099 87-0493596
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)

 

1332 N Halsted St Suite 403

Chicago, IL 60642

(312) 690-4466

(Address, including zip code, and telephone
number, including area code, of registrant’s principal executive offices)

 

Eric Gravengaard

Chief Executive Officer

1332 N Halsted St Suite 403

Chicago, IL 60642

(312) 690-4466

(Name, address, including zip code, and telephone
number, including area code, of agent for service)

 

Copies
of all communications to:

 

Iwona Alami, Esq.  

Matthew
Ogurick

Law Office of Iwona J. Alami   K&L
Gates, LLP
620 Newport Center Dr.  

599
Lexington Avenue

Suite 1100  

New
York, NY 10022

Newport Beach, CA 92660  

(212)
536-3901

(949) 200-4626  

 

Approximate
date of commencement of the proposed sale to the public:
As soon as practicable after this registration statement becomes effective.

 

If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act, check the following box:

 

If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering.

 

If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering.

 

If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering.

 

Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
  Emerging growth company ☒

 

If
an emerging growth company, indicate by checkmark if the registrant has not elected to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

 

The Registrant hereby amends this Registration
Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities
Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.

 

 

The
information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement
filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell nor does it seek an
offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

Subject
to completion, dated May 16, 2022

 

 

459,783,937 Shares of Common
Stock

 

 

 

This prospectus relates to the resale or other
disposition of up to 459,783,937 shares of Athena Bitcoin Global common stock, par value $0.001 per share (the “common stock”
or “shares”), which may be offered for sale from time to time by the selling shareholders named in this prospectus (each
a “Selling Shareholder” and, collectively, the “Selling Shareholders”). The shares of our common stock covered
by this prospectus include: (i) 409,933,937 shares of common stock that were issued by us to the Selling Shareholders in the share
exchange transaction or were purchased by the Selling Shareholders in private transactions, and (ii) up to 49,850,000 shares of
common stock issued or issuable upon exercise of our outstanding 6% Convertible Debentures Due 2023 (the “Convertible Debentures”)
which were issued in connection with a private placement financing in 2021. We are registering the resale of the shares of common stock
underlying the Convertible Debentures as required by the Securities Purchase Agreement that we entered into with the Selling Shareholders
as of June 22, 2021, which provided said Selling Shareholders with certain registration rights with respect to the common stock issuable
upon conversion of the Convertible Debentures (the “Purchase Agreement”). We are not selling any shares of common stock under
this prospectus and will not receive any proceeds from the sale of any shares of common stock by the Selling Shareholders. The Selling
Shareholders will bear all commissions and discounts, if any, attributable to the sale or other disposition of the shares of common stock.
We will bear all costs, expenses and fees in connection with the registration of the shares of common stock.

 

Our common stock is quoted on the OTC Pink Market
(“OTC Pink”) operated by the OTC Markets Group, Inc. under the symbol “ABIT”. On May 12, 2022, the last reported
sale of our common stock was $0.2875. There is a limited public trading market for our common stock. You are urged to obtain current
market quotations for the common stock.

 

Our registration of the shares of common stock
covered by this prospectus does not mean that the Selling Shareholders will offer or sell any of the shares. The Selling Shareholders
may offer and sell or otherwise dispose of the shares of common stock described in this prospectus from time to time through public or
private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices at
varying prices. See “Plan of Distribution” which begins on page 88 of this prospectus for more information.

 

This offering will terminate on the earlier
of (i) the date when all of the shares have been sold pursuant to this prospectus or Rule 144 under the Securities Act of 1933, as amended
(the “Securities Act”), (ii) or the date that all of the securities may be sold pursuant to Rule 144 without volume or manner-of-sale
restrictions, (iii) or we decide at any time to terminate the registration of the shares at our sole discretion.

 

We have made no written communications as
defined under Rule 405 of the Securities Act to prospective investors or investors.

 

You should rely only on the information contained
in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The
information contained in this prospectus is accurate only as of the date of this prospectus.

 

 

 

 

Investing in our shares involves a high
degree of risk. You should carefully consider the Risk Factors beginning on page 11 of this prospectus before you make an
investment in our securities.

 

We are an “emerging growth company”
as that term is used in the Jumpstart Our Business Startups Act (the “Jobs Act”) and defined under the federal securities
laws and, as such, may elect to comply with certain reduced public company reporting requirements in future reports after the completion
of this offering. See “Prospectus Summary—Implications of Being an Emerging Growth Company.”

 

We may amend or supplement this prospectus
from time to time by filing amendments or supplements as required. You should carefully consider the risks and uncertainties
described under the heading “Risk Factors” beginning on page 11 of this prospectus before you make
an investment decision.

 

Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus.
Any representation to the contrary is a criminal offense.

 

 

This Prospectus is dated
[●], 2022.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TABLE
OF CONTENTS

 

 

 

You should rely only on information contained
in this prospectus. We have not authorized anyone to provide you with information other than that contained in this prospectus or in any
free writing prospectus we may authorize to be delivered or made available to you. We take no responsibility for and cannot provide any
assurance as to the reliability of any other information others may give you. The Selling Shareholders are not offering to sell or seeking
offers to buy shares of common stock in jurisdictions where offers and sales are not permitted. The information in this prospectus or
any free writing prospectus is accurate only as of its date, regardless of its time of delivery or of any sale of shares of our common
stock. Our business, financial condition, results of operations, and prospects may have changed since that date. We are responsible
for updating this prospectus to ensure that all material information is included and will update this prospectus to the extent required
by law.

 

For investors outside of the United States: Neither
we nor any of the Selling Shareholders have done anything that would permit this offering or possession or distribution of this prospectus
in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who
come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of common
stock by the Selling Shareholders and the distribution of this prospectus outside of the United States.

 

 

 

 

ABOUT THIS PROSPECTUS

 

This prospectus is a part
of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the “SEC”) using a “shelf”
registration or continuous offering process. Under this shelf process, the Selling Shareholders may, from time to time, sell the shares
of common stock covered by this prospectus in the manner described in the section titled “Plan of Distribution.” Additionally,
we may provide a prospectus supplement to add information to, or update or change information contained in, this prospectus (except for
the section titled “Plan of Distribution,” which additions, updates, or changes that are material shall only be made pursuant
to a post-effective amendment). You may obtain this information without charge by following the instructions under the section titled
“Additional Information” appearing elsewhere in this prospectus. You should read this prospectus and any prospectus supplement
before deciding to invest in our shares.

 

INDUSTRY AND MARKET
DATA

 

Market data and certain
industry data and forecasts used throughout this prospectus were obtained from internal Company surveys, market research, consultant
surveys, publicly available information, reports of governmental agencies and industry publications and surveys. Industry surveys, publications,
consultant surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be
reliable, but the accuracy and completeness of such information is not guaranteed. We have not independently verified any of the data
from third party sources, nor have we ascertained the underlying economic assumptions relied upon therein. Similarly, internal surveys,
industry forecasts and market research, which we believe to be reliable based on our management’s knowledge of the industry, have
not been independently verified. Forecasts are particularly likely to be inaccurate, especially over long periods of time. Statements
as to our market position are based on the most currently available data. While we are not aware of any misstatements regarding the industry
data presented in this prospectus, our estimates involve risks and uncertainties and are subject to change based on various factors,
including those discussed under the heading “Risk Factors” in this prospectus.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Glossary
of Bitcoin and Crypto Terms

 

  · Address: An alphanumeric reference to where crypto assets
can be sent or stored.

 

  · Ankr: An Ethereum token that powers a decentralized public blockchain infrastructure that aims to make it easy and
affordable for anyone to participate in blockchain ecosystems.

 

  · Bitcoin: The first system of global, decentralized, scarce,
digital money as initially introduced in a white paper titled Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto.
Bitcoin, while having several of the primary attributes of money, is not considered a currency or money in the jurisdictions that
the Company operates, with the exception of El Salvador where it is legal tender.

 

  · Bitcoin ATM: A kiosk that can be used by a Customer to buy
or sell Bitcoin or other crypto assets in exchange for Cash.

 

  · Bitcoin Cash (BCH):
A fork of Bitcoin that seeks to add more transaction capacity to the network in order to be useful for everyday transactions. BCH is
based on the original Bitcoin blockchain with some distinct differences. A major one is an increased maximum block size of 32MB, compared
to just 1MB on Bitcoin. Increased block size allows BCH to process transactions faster than Bitcoin, with lower fees and an increased
per-second transaction capacity.
     
  · Bitcoin SV: A fork of Bitcoin Cash (BCH), also known as Bitcoin Satoshi’s Vision, that attempts to restore the original
Bitcoin protocol to align with Bitcoin inventor Satoshi Nakamoto’s original vision for the blockchain network.

 

  · Block: A grouping of Transactions validated by Miners and disseminated by the Network to servers that maintain the records
in a Blockchain. Blocks are added to an existing Blockchain as transactions occur on the network. Miners are rewarded for “mining”
a new block.

 

  · Blockchain: A cryptographically secure digital ledger that
maintains a record of all transactions that occur on the network and follows a consensus protocol for confirming new blocks to be
added to the blockchain.

 

  ·

Cash: The physical specie or
banknotes of a sovereign country including the US Dollar and other countries that issue fiat currency in paper formats.

     
  ·

Chivo:
Official Bitcoin platform of El Salvador that supports the use of Bitcoin as legal tender in the country. The platform facilitates
the exchange of Bitcoin and US dollar between users and their counterparties. The Chivo brand, which is the exclusive property
of the government of El Salvador, is used across multiple products and services including a mobile wallet (Chivo wallet), integrated
ATMs (Chivo ATMs) and point-of-sale (“POS”) terminals.

     
  · Cold storage: The storage of private keys in any fashion that is disconnected from the
internet. Common cold storage examples include offline computers, USB drives, or paper records.

 

 

 

 

 

  ·

Confirmation: A Bitcoin or
similar transaction is considered confirmed when it is included in a new Block in the Blockchain. Each time another block is
appended to the chain, the Transaction is confirmed again.

     
  · Crypto: A broad term for any cryptography-based market, system, application, or decentralized
network.
     
  · Cryptocurrency: Bitcoin and alternative coins, or ‘altcoins’. This category
of crypto asset is designed to work as a medium of exchange, store of value, or to power applications and excludes security tokens.

 

  · Customer: A retail user of our Bitcoin ATMs or client of
one of our other services.

 

  · Customer Buying: When a Customer acquires Bitcoin or crypto asset in exchange for Cash or a Wire Transfer. In these transactions, the Company is selling Bitcoin or crypto asset and acquiring
Fiat Currency.

 

  · Customer Selling: When a Customer acquires Fiat Currency,
either Cash or Wire Transfer, in exchange for Bitcoin or crypto asset. In these transactions, the Company is acquiring Bitcoin or
crypto asset in exchange for Fiat Currency.

 

  ·

Crypto Asset or Digital Asset:
Bitcoin and alternative digital forms of money, or ‘altcoins’, launched after the success of Bitcoin. This category
of crypto asset is designed to work as a medium of exchange or store of value. This term is inclusive of Ethereum, Litecoin,
and Bitcoin Cash, but not securities. In the Company’s marketing documents and website, this would be referred to as “cryptocurrency,”
however in this document we refer to this category of digital token as a “crypto asset.”

     
  · Ethereum: A decentralized global computing platform that supports smart contract transactions
and peer-to-peer applications, or “Ether,” the native crypto assets on the Ethereum network.

 

  · Fiat Currency: The currency issued by a sovereign government
or bloc including the US Dollar, Argentine Peso, or Euro.

 

  · Fork: A fundamental change to the software underlying a blockchain which results in two different blockchains, the
original, and the new version. In some instances, the fork results in the creation of a new token.

  

  · Hot Wallet: A wallet that
is connected to the internet, enabling it to broadcast transactions.

 

  · Miner: Individuals or entities who operate a computer or
group of computers that add new transactions to blocks, and verify blocks created by other miners. Miners collect transaction fees
and are rewarded with new tokens for their services.

 

  · Mining: The process by which new blocks are created, and
thus new transactions are added to the blockchain.

 

  · Monero:
A cryptocurrency focused on privacy, which allows users to send and receive transactions without making this
data available to anyone examining its blockchain.

 

 

 

 

 

  · Network: The collection of all Miners and Nodes that use
computing power to maintain the ledger and add new blocks to the blockchain. Most networks are decentralized, reducing the risk of
a single point of failure.

 

  · Node: A server that maintains a record of the Blockchain
and can communicate with other Nodes on the Network to propagate new Transactions. Nodes can also maintain Wallets and safeguard
Private Keys.

 

  · Protocol: A type of algorithm or software that governs how
a blockchain operates.

 

  ·

Public key or private
key
: Each public address has a corresponding public key and private key that are cryptographically generated. A private key allows
the recipient to access any funds belonging to the address, similar to a bank account password. A public key helps validate transactions
that are broadcasted to and from the address. Addresses are shortened versions of public keys, which are derived from private keys.

 

  · Ripple (XRP): Ripple is the cryptocurrency used by the Ripple payment network. Built for enterprise use, XRP aims to be a fast,
cost-efficient cryptocurrency for cross-border payments.

 

  · Siacoin:
Native cryptocurrency for the Sia blockchain platform, which serves as a way for customers to pay hosts for renting
storage space. The Sia project is meant to create a distributed, decentralized network for cloud data storage, similar to Dropbox or Google
Drive.

 

  · Stable Coin: A Token issued for the purpose of maintaining
a constant value relative to a fiat currency. Examples include USDC, Tether, or GUSD. Many of these operate as un-regulated money
market fund equivalents. These have become a popular method to transfer funds between exchanges without taking price risk.

 

  · Tether: A blockchain-based cryptocurrency whose tokens in circulation are backed by
an equivalent amount of U.S. dollars, making it a stablecoin with a price pegged to USD $1.00.

 

  · Token: A unit of a crypto asset or other instrument secured
by and recorded on a Blockchain. Tokens could include the primary units of a Blockchain as in Ethereum or Bitcoin, or be a separate
construct whose ownership is recorded using such a Blockchain as in an ERC-20 Token, whose ownership might convey any number of properties.

 

  · Transaction: The transfer of Bitcoin or a crypto asset from
one Address to one or more Addresses. The Transaction is validated by Nodes and Miners according to the Protocol and specifically
must be signed using the private key of the sending Address to be included in a Block, whereby it becomes Confirmed.
     
  ·

Tron:
Tron is a blockchain-based decentralized digital platform with its own cryptocurrency, called Tronix
or TRX. It is a platform built specifically for peer-to-peer file sharing with the goal of competing
with centralized media tech giants such as YouTube.

 

  · Wallet: A place to store public and private keys for crypto
assets. Wallets are typically software, hardware, or paper-based.

 

  · Wire Transfer: A permanent inter-bank transfer on a national
or international settlement system including the Fedwire system in the United States or the SWIFT international system but excluding
non-permanent systems like ACH.

 

 

 

 

 

 

 

Prospectus
Summary

 

This summary
highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you
should consider before investing in our common stock. You should carefully read the entire Prospectus, including “Risk
Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Financial Statements, before making an investment
decision. Unless the context suggests otherwise, all references to “Athena”, “we”, “us”,
“our”, or “the Company” refer to Athena Bitcoin Global, a Nevada corporation and all of its subsidiaries,
and all references to “Athena Bitcoin” refer solely to Athena Bitcoin, Inc., a Delaware corporation and a wholly-owned
subsidiary of the Company. As used below, Bitcoin with an uppercase “B” is used to describe the system as a whole that
is involved in maintaining the ledger of bitcoin ownership and facilitating the transfer of bitcoin among parties. When referring to
the digital asset within the Bitcoin network, bitcoin is written with a lower case “b” (except, of course, at the
beginning of sentences or paragraph sections, as below). The name “Athena Bitcoin” and the Athena Bitcoin logo service
mark appearing in this prospectus are the property of Athena Bitcoin, Inc., a wholly-owned subsidiary of the Company. Solely for
convenience, the trademarks, servicemarks and trade names in this prospectus are referred to without the ® and
symbols, but such references should not be construed as any indicator that the owner of such trademarks, servicemarks and trade
names will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend the use or display of
other companies’ trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other
companies.

 

Introduction

 

We are an early entrant in the crypto asset
market and one of the first U.S. publicly traded companies using crypto assets and blockchain technologies in our business operations
which include a global network of Athena Bitcoin ATMs.

 

Our management has determined that it is in our
best interests to become a reporting company under the Securities and Exchange Act of 1934 as amended (“Exchange Act”), and
endeavor to establish a public trading market for our common stock on the OTCQB or other trading systems. Currently our trading volume
is limited and we are subject to the Alternative Reporting Standard of OTC Pink Market. Our management believes that establishing a public
market on OTCQB or another exchange: (i) will increase our profile as a leading company in the international operation of Bitcoin ATMs,
giving us greater identity and recognition, and (ii) will make it easier for us to attract additional equity capital, which we need to
expand our business. There is no assurance that we will accomplish any of the foregoing goals and prospective investors are cautioned
to carefully read the risk factors set forth herein prior to making an investment decision.

 

 

Athena
Bitcoin connects the world’s
cash to the world of cryptocurrency.

 

 

 

 

Overview

 

Athena Bitcoin Global owns and operates a global
network of Athena Bitcoin ATMs, which we refer to as our ATMs, that allow our customers to buy or sell Bitcoin and other major crypto
assets in exchange for their local fiat currency, such as dollars or pesos. We are focused on making Bitcoin and other major crypto assets
more easily accessible, functional and usable for ordinary people and small businesses. Bitcoin, blockchains, smart contracts and crypto
assets are poised to transform the international financial order, however for billions of people, this new financial system is out of
reach. They still rely on cash, either because they do not have a bank account or choose not to use one. For them, a connection between
digital finance and paper currency is necessary.

 

Bitcoin is a system for decentralized digital
value exchange that is designed to enable units of bitcoin to be transferred across borders without the need for currency conversion.
Bitcoin is not legal tender, except recently in the country of El Salvador. The supply of bitcoin is not determined by a central government,
but rather by an open-source software program that limits both the total amount of bitcoin that will be produced and the rate at which
it is released into the network. The responsibility for maintaining the official ledger of who owns what bitcoin and for validating new
bitcoin transactions is not entrusted to any single central entity. Instead, it is distributed among the network’s participants.
As such, crypto assets are transferred entirely online, with no physical coins or bills. Instead of being held at a bank, crypto assets
are held in one’s digital wallet, which is an online vault for holding public and private keys for crypto assets.  Instead
of being transferred through banks, clearing houses and payment processors, crypto assets are transferred directly to the recipient online
and transactions are recorded on a blockchain or public ledger. The value of each crypto asset is determined by trading among buyers and
sellers all over the world. At the end of 2020, the overall market capitalization of crypto assets reached $782 billion, representing
a compounded average growth rate (CAGR) of over 150% since 2012. The supply of Bitcoin is greater than the M1 money supplies of the Swiss
Franc and the Russian Ruble. One challenge for Bitcoin and other crypto assets is that they typically cannot be used to pay for things
like groceries, utility bills, or a house. When someone wants to spend their bitcoin, they will generally need to first convert it to
their local currency. Crypto asset owners can use crypto exchanges like Coinbase and acquire U.S. dollars by selling their crypto asset(s).
On Coinbase or other crypto asset exchanges, users can oftentimes sell their bitcoin or other crypto assets for up to 50,000 U.S. dollars
a day which can be wired or otherwise sent directly to a bank account and typically usable after one or two business days. Crypto exchanges
are well suited for larger, planned transactions but can be inconvenient or entirely unsuitable for smaller or more immediate transactional
needs. They also do not offer the level of convenience that bank customers are accustomed to. Most people in the U.S. use bank ATMs rather
than bank tellers to get spending cash due to the added convenience.

 

ATM Market

 

According to a University of Florida study, there
were over 470,135 traditional ATMs operating in the United States in 2018. For Bitcoin owners, our ATMs play a similar role by providing
cash conveniently and quickly. Someone that owns Bitcoin, Ethereum, Litecoin or BCH can visit our ATMs and get up to $2,000 in cash in
a single transaction. While our ATMs dispense cash for Bitcoin owners like a typical ATM cash machine does for a bank customer, our ATMs
function is more akin to currency exchange booths at international airports. Our ATMs are performing real-time exchange between major
crypto assets and local fiat currency including dollars and pesos. Instead of exchanging across countries, we exchange between the legacy
financial system and a new emerging digital financial system. The majority of our customers use our services to purchase Bitcoin with
dollars. Although some of our ATMs in the United States support dispensing dollars in exchange for Bitcoin, only a small percentage of
customers use this service. However, in Central and South America, there is a more even distribution between purchases and sales. Athena
Bitcoin ATMs enable anyone to quickly buy or sell Bitcoin, Ethereum, Litecoin or BCH in exchange for local paper money. While our ATMs
differ substantially in function from bank ATMs, they provide a similar level of convenience. In addition, our ATMs benefit from the public’s
vast experience using bank ATMs, which greatly contributes to making our ATMs a very user-friendly method for anyone to buy or sell Bitcoin.

 

Company Summary

 

The Company is focused on developing, owning
and operating a global network of Athena Bitcoin ATMs, which are free standing kiosks that permit customers to buy or sell crypto assets
(including Bitcoin, Ethereum, Litecoin and BCH) in exchange for cash (banknotes) issued by sovereign governments and often
referred to as fiat currencies. The Company places its machines in convenience stores, shopping centers, and other easily accessible
locations. Our network presently includes Athena Bitcoin ATMs in 10 states and 3 countries in Central and South America. We seek to expand
our network in the U.S. and globally, and to further develop Athena Bitcoin as a trusted and preferred brand for parties seeking
to exchange currency for Bitcoin and other major crypto assets.

 

 

 

 

Customers can purchase as little as $1 of Bitcoin,
but normally choose between $100 and $1,000 using Athena Bitcoin ATMs. The typical ATM that the Company operates is about 5-feet tall
and features a large touchscreen for customer interaction. The customer typically needs to have a wallet app on his smart phone to buy
or sell crypto assets on our ATM. In the process of the transaction, the customer will follow the steps prompted on the screen. When a
customer is buying crypto assets, the machine will prompt the customer to insert cash since our ATMs do not accept debit or credit cards.
When the customer is done, a receipt will print showing exactly how much crypto assets have been bought and the address they were sent
to.

 

The Company’s ATMs do not contain any crypto
assets or keys to crypto assets. The Company sells Bitcoin, Ethereum, Litecoin, LTC and BCH from cloud-based wallets in each country,
enabling real-time supply of crypto assets to its customers. For the fiscal years ending December 31, 2021 and December 31, 2020, the
Company’s breakdown of volume of ATM transactions per crypto asset is as follows:

 

Crypto Asset

For the Twelve Months Ended

December 31, 2021

For the Twelve Months Ended

December 31, 2020

Bitcoin
87,816 100,113
Ethereum
1,936 913
Litecoin 5,513 7,511
Bitcoin
Cash (BCH)
865 1,044
Total
96,130 109,581

 

The Company buys most of its crypto assets through
automated purchases on crypto exchanges, based on algorithms the Company has developed for balancing its holdings with anticipated demand.
In addition to this automated buying program, the Company is active in the over-the-counter dealer market and has bilateral relationships
with several large crypto asset trading desks. We replenish our supply of Bitcoin, Ethereum, Litecoin and BCH daily as needed, and hold
them in our wallet to sell to users of our ATMs. On average, we sell our holdings of Bitcoin within 3 to 5 days of buying it, and within
7 to 10 days of buying our Ethereum, Litecoin, and BCH holdings. We strive to keep this period short to reduce the effect of changes in
crypto assets/U.S. dollar exchange rates on our business and to maximize our working capital. We do not invest or have long term holdings
of Bitcoin, Ethereum, Litecoin or BCH.

 

We charge a fee per crypto asset available through
Athena Bitcoin ATM, equal to the prevailing price at U.S.- based exchanges plus a mark up that typically ranges between 5% and 20%. The
prices shown to customers on our Bitcoin ATM are inclusive of this price spread and are calculated by multiplying the prevailing price
level of crypto asset by one plus the mark up. The mark up varies from one crypto asset to another and by location. It is determined
by a proprietary method that is maintained as a trade secret. Our revenues associated with our ATM transactions are recognized at the
time when the crypto asset is delivered to the customer. By increasing our geographic service area, including our recent expansion of
operations in El Salvador, we aim to make Athena into a global financial services company that can connect the world’s cash to
the world of crypto assets.

 

Corporate History and Other Information

 

The Company was incorporated in the state of
Nevada in 1991 under the name “GamePlan, Inc.” for the sole purpose of merging with Sunbeam Solar, Inc., a Utah corporation,
which merger occurred as of December 31, 1991 with GamePlan, Inc. as a sole surviving entity. The Company was involved in various businesses,
including, gaming and other consulting services, prior to becoming a company seeking acquisitions (a “shell company” as defined
in Rule 405 of the Securities Act). The Company was a reporting issuer under the Securities and Exchange Act of 1934 (the “Exchange
Act”) from 1999 until 2015 when it filed Form 15 pursuant to Rule 12g-4(a)(1) with the Commission and ceased to be a reporting
company.

 

On January 14, 2020 the Company entered into a
Share Exchange Agreement (the “Agreement”), by and among the Company, Athena Bitcoin, Inc., a Delaware corporation (“Athena
Bitcoin”) incorporated in 2015, and certain shareholders of Athena Bitcoin. The Agreement provides for the reorganization of Athena
Bitcoin, with and into the Company, resulting in Athena Bitcoin becoming a wholly-owned subsidiary of the Company. The agreement is for
the exchange of 100% shares of the outstanding common stock of Athena, for 3,593,644,680 shares of GamePlan, Inc. common stock (an exchange
rate of 1,244.69 shares of common stock of GamePlan, Inc. for each share of Athena Bitcoin common stock). The closing of the transaction
occurred as of January 30, 2020. Subsequently, in May, 2020, the Company filed its amended and restated articles of incorporation authorizing
a total of 4,409,605,000 shares of common stock.

 

 

 

 

 

The Company approved the name change from “GamePlan,
Inc.” to “Athena Bitcoin Global” on March 10, 2021 by the unanimous consent of its Board of Directors and a majority
consent of its shareholders. The Company filed an amendment to its Articles of Incorporation with the Secretary of State of the state
of Nevada on April 6, 2021, with the effective date of April 15, 2021. The Company’s name change and trading symbol change to “ABIT”
was declared effective by FINRA on OTC Pink Market as of June 9, 2021.

 

The Company, Athena Bitcoin Global, is a Nevada
corporation which owns 100% of our operating subsidiary, Athena Bitcoin, Inc., a Delaware corporation. Our domestic business operations
are conducted by Athena Bitcoin, Inc. We have operating subsidiaries in the specific countries where we operate, as more fully described
in the following:

 

 

 

(1) Athena Bitcoin Inc. owns 99% of
Athena Holdings El Salvador SA de CV and Eric Gravengaard holds 1% on behalf of the Company.

 

(2) Athena Bitcoin Inc. beneficially
owns and controls Athena Holdings SAS which is nominally owned by Eric Gravengaard 95% and Matias Goldenhörn 5%.

 

(3) Athena Bitcoin Inc. beneficially
owns and controls Athena Holding Company SRL which is nominally owned by Eric Gravengaard 45%, Gilbert Valentine 45%, and Matias Goldenhörn
10%.

 

(4) Athena Bitcoin Inc. owns 2,999
Shares of Athena Bitcoin SRL de CV and Eric Gravengaard owns 1 Share on behalf of the Company.

 

(5) Athena Bitcoin Inc. is the only
member of Athena Holdings of PR, LLC.

 

(6) Athena Bitcoin Inc. owns
100% Athena Business Holdings Panama S.A.

 

Our corporate office is located at 1332 N Halsted
St., Suite 403, Chicago, IL 60642, and our telephone number is 312-690-4466. Our website is www.athenabitcoin.com. The information
on, or that can be accessed through, our website is not part of this prospectus and is not incorporated by reference herein.

 

Industry Summary

 

The Company is an active participant in the operation
of Bitcoin ATMs in the U.S. and Latin America. More broadly we operate in the market of retail sales of bitcoin facilitating small purchases
of Bitcoin, Ethereum, Litecoin, and BCH. There are many ways that retail consumers, individuals purchasing small amounts from one dollar
to a few thousand dollars’ worth, can purchase or dispose of crypto assets.

 

 

 

 

 

The Birth of Bitcoin ATMs

 

In the earliest days of Bitcoin, most transactions
were done in person – often facilitated by websites. These sites matched prospective buyers with sellers and facilitated communications
and wallet coordination, allowing them to meet in public places like coffee shops and street corners, and exchange bitcoin for envelopes
of cash. The first Bitcoin ATMs began appearing in 2014. These ATMs were an instant hit with retail customers who were accustomed to
in-person transactions because they offered instantaneous access to bitcoin in a familiar and safe method.

 

According to Reuters in a March, 2021 article
titled “Bitcoin ATMs are coming to a gas station near you”, the industry has grown from a handful of machines operated by hobbyists
to more than 15,000 kiosks worldwide primarily operated by increasingly larger organizations. There are many operators of Bitcoin ATM
networks, from crypto businesses to major corporate and conventional kiosk companies including Coinstar.

 

Some Bitcoin ATMs offer one-way exchange,
allowing customers to only buy crypto assets. Others offer two-way exchange, so customers can buy crypto assets for cash, or sell some
of their crypto assets and receive cash. Athena Bitcoin ATMs, serve clients with the following types of crypto assets: Bitcoin, Ethereum,
Litecoin, and BCH in either one-way or two-way exchanges, depending on the functionality of each ATM machine.

 

Bitcoin Exchanges

 

Parties that want to use their bank accounts to
buy Bitcoin can do so without an ATM. These transactions are the domain of exchanges and specialty apps including services from Coinbase,
Gemini, Kraken, and Square. These services generally accept U.S. dollar transfers from bank accounts and do not accept physical currency.
These services may or may not, depending on several factors including method of deposit, allow the purchaser of a crypto asset on their
platforms to immediately transfer the crypto asset into their own wallet. These services cater to larger purchasers and investors in crypto
assets. Users of exchanges may use ATMs as a convenient method to get spending cash, similar to how bank account and credit card holders
use bank ATMs.

 

The growth of businesses and services that accept
Bitcoin and make it more functional is contributing to increasing Bitcoin usage. In October of 2020, PayPal and Venmo announced they will
accept Bitcoin, thus enabling PayPal and Venmo customers to use their Bitcoin to make online purchases and online payments. In 2020 and
2021, with little promotion and advertising, we have experienced a significant increase in transaction volumes and average transaction
sizes (see “
Management’s Discussion and Analysis of Financial Condition and Results of Operations”).
We believe this trend is due in part to an increase in companies and online service providers that are helping to make Bitcoin more widely
and easily usable. We believe that the use of Bitcoin ATMs will continue to rise as the Bitcoin and crypto industry and its many interconnected
service providers expand.

 

Business Strategies

 

We seek to grow and distinguish Athena Bitcoin
services based on our method of location selection, our global expansion, operational efficiencies, and our authenticity as a crypto
industry forerunner with respect to Bitcoin ATMs.

 

We are an efficient operator.

 

We are focused on placing our ATMs in optimal
locations that maximize both current income and future potential. Our ATMs are in urban, suburban, and rural locations. Our site selection
criteria and metrics are a closely guarded proprietary aspect of our business. In placing our ATMs, we employ a data driven strategy based
on factors we have learned over the years. In addition to data metrics, our placement strategy includes analysis of immediate trends,
as we are in a dynamic business where usage is widening dramatically and often in unpredicted ways. Each location is chosen to complement
the rest of the fleet and offer customers of diverse backgrounds access to convenient crypto assets transactions.

 

We are constantly improving our operational efficiency.
Our ATMs serve as remote tellers that connect to our centralized cloud-based crypto trading operation. We have proprietary systems and
methods of managing our currency exchange operation. Our founders have a deep understanding of high-frequency trading and were some of
the first to electronically trade Bitcoin on multiple exchanges simultaneously. The objective of our purchasing algorithms is to frequently
re-balance our crypto holdings to meet the dynamic demand of our many customers. Over-buying of any crypto asset can result in inefficiency
and currency risk, while under-buying may temporarily prevent us from selling crypto assets at our ATMs. We strive to improve the efficiency
of our currency exchange operations to maximize our profits, manage risk and facilitate growth.

 

 

 

 

 

 

We are a global business.

 

We placed our first ATM outside the U.S. in Mexico
in 2017. According to the CIA World Factbook, the median age in the United States is 38. In South America it is 31, and Africa has a median
age of only 18. As the digital generation accumulate their wealth, they are far more likely to embrace crypto assets than their predecessors.
Bitcoin is poised to quickly become a part of the lives of a huge percentage of the developing world’s population. This “global
south” offers a large green field expansion opportunity for us because it combines high usage of physical currency with low median
age and reduced access to quality banking.

 

On June 8, 2021, El Salvador became the first
and remains the only country to officially adopt the cryptocurrency as legal tender when its congress passed the Bitcoin Law proposed
by President Nayib Bukele. On September 7, 2021, the Bitcoin Law was implemented and Bitcoin became legal tender in El Salvador, alongside
the U.S. dollar, the country’s other official currency. Under the new law, Salvadorans can pay taxes in Bitcoin and businesses are
obliged to accept Bitcoin as payment for goods and services, in addition to the U.S. dollar. Given that more than 70% of the adult population
of El Salvador does not have access to the traditional banking system, the government of El Salvador believes that Bitcoin will greatly
help the unbanked get access to electronic payments.

 

The Company began working with the government
of El Salvador in late June 2021 to support the implementation of its Bitcoin Law. In August 2021, we entered into certain agreements
for services to be rendered by the Company to the Department of Treasury (Ministerio De Hacienda) of El Salvador, pursuant to which we
have installed and are operating 200 Chivo Bitcoin ATMs in El Salvador, 10 Chivo Bitcoin ATMs at El Salvador consulates in the U.S.,
45 Chivo Bitcoin ATMs in other U.S. locations, and importing and delivering 950 Chivo point-of-sale (“POS”) terminals for
local businesses in El Salvador to transact with Bitcoin. As of December 31, 2021, all Chivo Bitcoin ATMs are installed and operational
and all 950 point-of-sale terminals have been delivered and subsequently distributed to end-users as per above. The Company is responsible
for maintaining the existing software infrastructure supporting the operation of the ATMs, the hardware maintenance of the ATM, cash
logistics and customer support. Currently, there are no on-going obligations with respect to the POS terminals. For the fiscal year
ended December 31, 2021 the Company presented to the government of El Salvador/Ministerio de Hacienda invoices amounting to $300,000
for the installation of white label machines, $1,000,000 for the monthly maintenance of the 200 white label machines in El Salvador,
$360,000 for the sale of POS terminals, $584,000 for the monthly software maintenance, $385,000 for the monthly maintenance of the 55
white label machines in the USA and $37,800 for the service fee for the 55 white label machine transactions. The total amount of $2,666,800
exclusive of VAT was recorded as part of Revenues in the Consolidated Statement of Operations and Comprehensive Income. As of December
31, 2021, $1,418,800 of these amounts remained outstanding and was recorded as part of Accounts receivable on the Consolidated Balance
Sheets. The Company does not anticipate any further sales of POS terminals to the government of El Salvador.

 

In addition to the ATM and POS portions of
the agreements for services, we were also contracted to develop and maintain a Bitcoin platform (Chivo Ecosystem) to support the Chivo
digital wallet. The Company was obligated to provide the software for the Chivo digital wallet, comprising both the software that
runs on mobile smartphones, which we refer to as the App, and the software that runs on servers, which together comprise the Chivo Digital
Wallet. The Chivo Digital Wallet has the following functions: (i) storing and displaying USD and Bitcoin balances; (ii) sending and receiving
USD and Bitcoin between users of the Chivo digital wallet and (iii) sending and receiving Bitcoin using on-chain and Lightning Network
transaction.

 

The delivery of the software was initially completed
on September 7, 2021 . In response to news reports of user problems and government requests for changes the Company hired additional
technology resources and delivered subsequent improvements continuously throughout the quarter ending December 31, 2021. The usage of
the software we provided and the operation of the Chivo digital wallet was conducted by Chivo S.A. de C.V., a government-controlled entity.
Through the year ended December 31, 2021, the Company booked $3,500,000 as advances for revenue contract and $757,000 as capitalized
software development within other non-current assets for the costs related to the Chivo Ecosystem in the consolidated balance sheets.
In addition, $700,000 in taxes were recorded as part of income tax expense in the consolidated statement of operations and comprehensive
income.

 

The government of El Salvador discontinued
use of the Company’s software on or about December 15, 2021, but has not terminated its contract with the Company as the Company
assists the government’s secondary provider. At the time the contract for the software was negotiated, the Company was aware that
the government of El Salvador was considering multiple providers and our contract included the option for the government to change providers.
Our non-disclosure agreement with the government of El Salvador prohibits us from discussing the operation of the Chivo digital wallet.
The government of El Salvador did not provide us with the reasons behind their decision. Parts of the contract related to data retention
security, analysis and reporting remain in effect as of the time of this prospectus as do the services related to the operation of the
Chivo branded ATMs and the POS terminals, but the government of El Salvador is not using the Company’s software to enable the Chivo
digital wallet. The expected revenues and associated costs of satisfying those data obligations will be determined based on ongoing negotiations
and requests of the government.

 

 

 

 

 

 

There are no expected future costs for
the POS sections of the agreements as the Company does not expect to sell additional POS terminals to the government of El Salvador
as of the date of this prospectus.

 

On April 20, 2022, David Gerard, an author
of several books and an eponymous website, reported that there was a theft of several million dollars from the Chivo digital wallet on
or around April 1, 2022. This event, if true, was after the migration of user data from the Company’s software to the new software
provider for the Chivo digital wallet and the Company has no direct knowledge of or responsibility for the alleged events.

 

None of the funds received under the agreements
are refundable upon contract termination.

 

The government of El Salvador owns the software
(which we refer to as the “IP Software”) and the Company has a perpetual, royalty-free license under its Master Services Agreement
to market the IP Software elsewhere.

 

Subsequent to executing the Master Services Agreement,
the Company implemented branding of its “Athena Ruru” suite of services, with such brand comprising of the three services
the Company offers: Bitcoin ATMs, POS terminals and merchant services, and the wallet solution, based on the App. To date, the Company
has not completed the sale of a license to its bitcoin platform, marketed under the Athena Ruru brand, to any other person, including
without limitation any government entity or bank.

 

The initial term of the Master Services Agreement
(the “MSA”) is three-years beginning on August 20, 2021. The Company’s El Salvador Contracts have the following ongoing
terms for their obligations:

  

Specific Nature of Services Term Status Revenue YE 2021 Paid to YE 2021 Accounts Receivable as YE 2021
Contract
51/2021 (Installation and Maintenance of Chivo ATMs)
July 30, 2021 – July 30, 2024 – Ongoing $ 1,685,000 $ $800,000 $ 885,000
Contract 56/2021 (Development of Chivo Wallet, alternative version of SA1) August 9, 2021 – December 31, 2021 Concluded     3,500,000*  
Service Addendum 1 (Phase 1: Service Fees for Chivo Ecosystem) August 15, 2021 – December 31, 2021 Concluded   584,000   88,000   496,000
Service Addendum 1 (Phase 2: Service Fees USA Based Activities) September 7, 2021- December 31, 2022 Ongoing   37,900     37,900
Service Addendum 2 (Importation, setup, and distribution of POS terminals) August 20 – September 7, 2021 Concluded   360,000   360,000  

 

*Recognized as Advances for revenue contracts
in the Consolidated Balance Sheets

 

See also Business – Operations in El Salvador- Material Contracts on page 61.

 

Our strategy is to become a global financial
services company that can connect the world’s cash to the world of digital assets including Bitcoin, Ethereum, Litecoin, and BCH.
We have spent years learning how to expand our business across borders. We have assembled the people, processes, and technologies
to enable us to continue to grow our global footprint we believe is unmatched by our competition.

 

 

 

 

 

 

 

Competitive Strengths

 

When comparing Bitcoin ATMs to other methods of
transacting, the primary advantage of an ATM is its ability to complete a transaction from payment to delivery of crypto assets quickly.
In the context of a purchase transaction, our ATM only accept physical currency, which is an immediate and permanent form of payment,
and which facilitates the immediate delivery of crypto assets, also an immediate and permanent form of transaction. Apps and services
that rely on ACH or other bank mechanisms for the delivery of fiat currency in a transaction often cannot deliver the crypto asset quickly
because the funding mechanism is neither immediate nor permanent.

 

Risk Factors Associated with Our Business

 

Investing in our shares of common stock involves
significant risks. You should carefully consider the risks described in “Risk Factors” before deciding to invest in our shares.
If we are unable to successfully address these risks and challenges, our business, financial condition, results of operations, or prospects
could be materially adversely affected. In any of such cases, the trading price of our common stock would likely decline, and you may
lose all or part of your investment. Below is a summary of some of the risks we face.

 

  · Our shares are subject to liquidity risks.
     
  · Our business is in a relatively new consumer product segment, which is difficult to forecast.
     
  · Our operating results may fluctuate due to the highly volatile nature of crypto.
     
  · A majority of our net revenue is derived from transactions in Bitcoin. If demand for crypto assets
declines, our business, operating results, and financial condition could be adversely affected.
     
  · The future development and growth of crypto is subject to a variety of factors that are difficult
to predict and evaluate. If crypto does not grow as we expect, our business, operating results, and financial condition could be
adversely affected.
     
  · Cyberattacks and security breaches of our platform, or those impacting our customers or third
parties, could adversely impact our brand and reputation and our business, operating results, and financial condition.

 

  · We are subject to an extensive and highly-evolving regulatory landscape and any adverse changes
to, or our failure to comply with, any laws and regulations could adversely affect our brand, reputation, business, operating results,
and financial condition.
     
  · As we continue to expand and localize our international activities, our obligations to comply
with the laws, rules, regulations, and policies of a variety of jurisdictions will increase and we may be subject to investigations
and enforcement actions by regulators and governmental authorities.
     
  · We currently rely on third-party service providers for certain aspects of our operations, and
any interruptions in services provided by these third parties may impair our ability to support our customers.
     
  · Loss of a critical banking relationship could adversely impact our business, operating results, and
financial condition.
     
  · Any significant disruption in our products and services, in our information technology systems,
or in any of the blockchain networks we support, could result in a loss of customers or funds and adversely impact our brand and
reputation and business, operating results, and financial condition.
     
  · The loss or destruction of private keys required to access any crypto assets held for our business
transactions with our customers may be irreversible. If we are unable to access our private keys or if we experience a hack or other
data loss relating to our ability to access any crypto assets, it could cause adversely impact our business operations, operating
results, regulatory scrutiny, reputational harm, and other losses.
     
  · None of our stockholders are party to any contractual lock-up agreement or other contractual restrictions
on transfer. Following the registration of our shares, the sales or distribution of substantial amounts of our common stock, or the
perception that such sales or distributions might occur, could cause the market price of our common stock to decline.

 

 

 

 

 

Impact from COVID-19

 

The significant global outbreak of COVID-19
has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide and has affected
our business in several ways. First, we have been unable to ship our ATMs freely between countries. Second, it has restricted the movement
of our employees and their ability to both collaborate in-person, and to do some field-service and installation work.

 

We are responding to the global outbreak of
COVID-19 by taking steps to mitigate the potential risks to us posed by its spread and the impact of the restrictions put in place by
governments to protect the population. Our employees and service providers have transitioned to work-from-home. This subjects us to heightened
operational risks. For example, technologies in our employees’ and service providers’ homes may not be as robust as in our
offices and could cause the networks, information systems, applications, and other tools available to employees and service providers
to be more limited or less reliable than in our offices. Further, the security systems in place at our employees’ and service providers’
homes may be less secure than those used in our offices, and we may be subject to increased cybersecurity risk, which could expose us
to risks of data or financial loss, and could disrupt our business operations. There is no guarantee that the data security and privacy
safeguards we have put in place will be completely effective or that we will not encounter risks associated with employees and service
providers accessing company data and systems remotely.

 

In addition, the continued spread of COVID-19
and the imposition of related public health measures have resulted in, and is expected to continue to result in, increased volatility
and uncertainty in the crypto-economy. We also rely on third party service providers to perform certain functions. Any disruptions to
a service providers’ business operations resulting from business restrictions, quarantines, or restrictions on the ability of personnel
to perform their jobs could have an adverse impact on our service providers’ ability to provide services to us. The continued spread
of COVID-19 and efforts to contain the virus could adversely impact our strategic business plans and growth strategy, reduce demand for
our products and services, reduce the availability and productivity of our employees, service providers, and third-party resources, cause
us to experience an increase in costs due to emergency measures, and otherwise adversely impact our business.

 

Offering Summary

 

We are registering the resale of 459,783,937 shares
of our common stock that include: (i) 409,933,937 shares of common stock that were issued by us to the Selling Shareholders in the share
exchange transaction or were purchased by the Selling Shareholders in private transactions, and (ii) up to 49,850,000 shares of common
stock issued or issuable upon exercise of our outstanding 6% Convertible Debentures Due 2023 (the ”Convertible Debentures”)
which were issued in connection with a private placement financing in 2021.

 

Implications of Being an Emerging Growth
Company and Smaller Reporting Company

 

We are an emerging growth company, as defined
in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”). For as long as we continue to be an emerging growth company,
we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging
growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in this prospectus and our periodic
reports and proxy statements and exemptions from the requirements of holding nonbinding advisory votes on executive compensation and stockholder
approval of any golden parachute payments not previously approved. We could remain an emerging growth company for up to five years after
the effective date of this Registration Statement, although circumstances could cause us to lose that status earlier, including if the
market value of our common stock held by non-affiliates exceeds $700 million as of any December 31 before that time or if we have total
annual gross revenue of $1.07 billion or more during any fiscal year before that time, in which cases we would no longer be an emerging
growth company as of the following December 31 or, if we issue more than $1.07 billion in non-convertible debt during any three-year period
before that time, we would cease to be an emerging growth company immediately. Even after we no longer qualify as an emerging growth company,
we may still qualify as a “smaller reporting company” which would allow us to take advantage of many of the same exemptions
from disclosure requirements, including reduced disclosure obligations regarding executive compensation in our periodic reports and proxy
statements. Additionally, even if we no longer qualify as an emerging growth company, as long as we are neither a “large accelerated
filer” nor an “accelerated filer,” we would not be required to comply with the auditor attestation requirements of Section
404 of the Sarbanes-Oxley Act. We cannot predict if investors will find our securities less attractive because we may rely on these exemptions,
which could result in a less active trading market for our securities and increased volatility in the price of our securities.

 

 

 

 

 

Finally, we are a “smaller reporting
company” (and may continue to qualify as such even after we no longer qualify as an emerging growth company) and accordingly may
provide less public disclosure than larger public companies, including the inclusion of only two years of audited financial statements
and only two years of management’s discussion and analysis of financial condition and results of operations disclosure. As a result,
the information that we provide to our stockholders may be different than you might receive from other public reporting companies in
which you hold equity interests.

 

Summary Consolidated Financial Data

 

The following tables set forth a summary of our
historical consolidated financial data as of and for the periods indicated. The summary consolidated statements of operations data
for the fiscal years ended December 31, 2021 and December 31, 2020, respectively, have been derived from our audited consolidated financial
statements and related notes thereto included elsewhere in this prospectus. Our historical results are not necessarily indicative
of the results to be expected in the future. When you read this summary consolidated financial data, it is important that you read it
together with the historical consolidated financial statements and the related notes thereto included elsewhere in this prospectus, which
qualify this summary consolidated financial data in their entirety, as well as the sections of this prospectus titled “Selected
Consolidated Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
The summary financial data in this section are not intended to replace our audited consolidated financial statements and the related
notes, and are qualified in their entirety by such financial statements and related notes included elsewhere in this prospectus.

 

(in thousands)

Balance
Sheet Summary

  For the twelve months ended
December 31
 
   

2021

Audited

   

2020

Audited

 
Current assets   $ 7,948     $ 2,201  
Other assets     7,053       4,274  
Total assets   $ 15,001     $ 6,475  

 

Current liabilities   $ 11,999     $ 4,312  
Long-term liabilities     10,576       5,435  
Total shareholders’ deficit     (7,574 )     (3,272 )
Total liabilities and shareholders’ deficit   $ 15,001     $ 6,475  

 

(in thousands)

Statement
of Operations Summary

  For the twelve months ended
December 31
 
   

2021

Audited

   

2020

Audited

 
Revenues   $ 81,747     $ 68,937  
Cost of revenues     76,178       62,390  
Gross profit     5,569       6,547  
                 
Operating expenses     6,774       3,497  
Income (loss) from operations     (1,205 )     3,050  
                 
Fair value adjustment on crypto asset borrowing derivatives     515       1,061  
Interest expense     661       990  
Fees on crypto asset borrowing     341       466  
Other (income) expense     39       (55 )
Income (loss) before taxes     (2,761 )     588  
                 
Income tax expense (benefit)     883       428  
Net income (loss)   $ (3,644 )   $ 160  

 

 

 

 

The
Offering

 

Common Stock offered by Selling Shareholders   459,783,937
shares of common stock which include: (i) 409,933,937 shares of common stock that were issued by us to the Selling Shareholders
in the share exchange transaction or were purchased by the Selling Shareholders in private transactions, and (ii) up to 49,850,000
shares of common stock issued or issuable upon exercise of our outstanding 6% Convertible Debentures Due 2023 (the “Convertible
Debentures”) which were issued in connection with a private placement financing in 2021. We are registering the resale of the
shares of common stock underlying the principal amount of the Convertible Debentures, as required by the Securities Purchase Agreement
that we entered into with the Selling Shareholders as of June 22, 2021, which provided said Selling Shareholders with certain registration
rights with respect to the common stock issuable upon conversion of the principal amount of the Convertible Debentures (the “Purchase
Agreement”).
     
Common Stock outstanding before the offering   4,089,409,545 shares of common stock
     
Exchange Symbol   ABIT
     
CUSIP   046839106
     
Terms of the Offering   The Selling Shareholders have not engaged any underwriter regarding the sale of their shares of common stock. The sale price to the public will vary according to prevailing market prices or privately negotiated prices by the Selling Shareholders.
     
Termination of the Offering   The offering will conclude upon the earliest of (i) such time as all the common stock has been sold pursuant to the registration statement or (ii) such time as all the common stock becomes eligible for resale without volume limitations pursuant to Rule 144 under the Securities Act (iii) or we decide at any time to terminate the registration of the shares at our sole discretion.
     
Trading Market   Our common stock is currently quoted on the OTC Pink Market operated by OTC Markets Group, Inc. There is an uneven and limited trading market for our securities. We intend to apply for quotation on the OTCQB once we become a fully reporting company with the SEC.
     
Use of proceeds   We are not selling any shares of the common stock covered by this prospectus. As such, we will not receive any of the offering proceeds from the registration of the shares of common stock covered by this prospectus.
     
Expenses   We will pay all expenses associated with this registration statement.
     
Risk Factors   The shares offered hereby involve a high degree of risk and should
not be purchased by investors who cannot afford the loss of their entire investment. See “Risk Factors” beginning on
page 11.

 

The number of shares of common stock to be outstanding
immediately after this offering is based on 4,089,409,545 shares of common stock outstanding as of March 31, 2022 and excludes:

 

  · 250,000,000 shares of common stock issuable upon
conversion of 8% Convertible Debenture Due 2025 issued to KGPLA Holdings, LLC;

 

  · 15,200,000
shares of common stock issuable upon conversion of the remaining outstanding principal amount of the 6% Convertible Debenture Due
2023 issued to certain accredited investors pursuant to the Company’s private placement of up to $5,000,000. See page 68.

 

 

 

 

 

Risk
Factors

 

Investing in the Shares involves a high
degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information
in this prospectus, before deciding to invest in the Shares. If any of the risks occur, our business, results of operations, financial
condition, and prospects could be harmed. In that event, the trading price of the Shares could decline, and you could lose part or all
your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our
business operations.

 

The Most Material Risks Related to Our
Business and Financial Position

 

Our business is in a new consumer product
segment, which is difficult to forecast.

 

Our industry segment is new and is constantly
evolving. As a result, there is a lack of available information with which to forecast industry trends or patterns. There is no assurance
that sustainable industry trends or preferences will develop that will lead to predictable growth or earnings forecasts for individual
companies or the industry segment. We are also unable to determine what impact future governmental regulation may have on trends and
preferences or patterns within our industry segment. See “
Risk Factors Related to Current and Future Regulations and other Law Enforcement Actions” for a discussion
of the risks associated with governmental regulation.

 

The prices of Bitcoin and other crypto assets
are volatile.

 

We generate substantially all our revenue from
the sale of crypto assets to our customers, either using our Bitcoin ATMs or over the phone. Revenue is based on the prices that we charge
our customers based on prevailing market prices. The price at which we are able to purchase crypto assets prior to selling those same
crypto assets may not be lower than the sale price if the market conditions change between those two points in time. Purchasing Bitcoin
or other crypto assets for prices higher than they can be later sold could result in an impairment of the asset value and our operating
results could be adversely affected. The value of the entirety of our crypto assets held could be lost if the prices of those digital
assets were to significantly decrease, which would adversely affect our operating results. There are no assurances that the crypto assets
we hold will have value from one day to the next and we could suffer a loss if any of the prices of those crypto assets declines or is
permanently depressed.

 

As discussed in our financial statements included
in this prospectus, we account for our crypto assets as indefinite-lived intangible assets, which are subject to impairment losses if
the fair value of our crypto assets decreased below their carrying value. As of December 31, 2021, management’s estimate of the
effect on fair values due to a +/- 20% uniform change in the market prices of all crypto assets, with all other variables held constant,
was +/- $168.4 thousand (December 31, 2020: +/- $268.6 thousand).

 

Additionally, and as discussed in our financial
statements, we act as an agent (vs. principal) in the operation of the Chivo branded Bitcoin ATMs. As part of our contract with the government
of El Salvador, the Company manages the processes of purchasing and selling of Bitcoin that are involved with the operations of the Chivo
branded Bitcoin ATMs and assumes the price risk associated with those transactions. The value of the Bitcoin between the time of a transaction
at such an ATM and the time at which the Company exchanges them to/for USD can be between seconds and hours, during which time the price
of Bitcoin relative to the US dollar can change. As of December 31, 2021, management estimates that if Bitcoin were to change prices by
+/- 20%, with all other variables held constant, the risk of gain/loss on the value of the Bitcoin used by the Chivo branded Bitcoin ATMs
would be +/- $236.1 thousand (prior periods: Not Applicable).

 

Our total revenue is substantially dependent
on the volume of transactions conducted by our customers. If such volume declines, our business, operating results, and financial position
would be adversely affected.

 

We generate substantially all our revenue from
the sale of crypto assets to our customers, either using our Bitcoin ATMs or over the phone. Revenue is based on the prices that we charge
our customers based on prevailing market prices. This revenue may fluctuate based on the price of crypto assets. As such, any declines
in the volume of transactions, the price of crypto assets, or market liquidity for crypto assets generally may result in lower total
revenue to us.

 

 

 

 

 

 

The price of crypto assets and associated demand
for buying, selling, and trading crypto assets have historically been subject to significant volatility. The price and trading volume
of any crypto asset is subject to significant uncertainty and volatility, depending on several factors, including:

 

· market
conditions across all elements of the crypto-economy;

 

· changes
in liquidity, market-making volume, and trading activities;

 

· trading
activities on other crypto platforms worldwide, many of which may be unregulated, and may
include manipulative activities;

 

· investment
and trading activities of highly active retail and institutional users, speculators, miners,
and investors;

 

· the
speed and rate at which crypto assets and specifically Bitcoin can gain adoption as a medium
of exchange, utility, store of value, consumptive asset, security instrument, or other financial
assets worldwide, if at all;

 

· decreased
user and investor confidence in crypto assets and associated exchanges and service providers;

 

· negative
publicity and events relating to Bitcoin, blockchain technology, or the digital currency
economy as a whole;

 

· unpredictable
social media coverage or “trending” of Bitcoin or other crypto assets;

 

· the
ability for crypto assets to meet user and investor demands;

 

· consumer
preferences and perceived utility and value of crypto assets and associated markets;

 

· increased
competition from other payment services or other crypto assets that exhibit better speed,
security, scalability, or other characteristics;

 

· regulatory
or legislative changes and updates affecting the use, storage, ownership, exchange, or any
other aspect of the crypto-economy;

 

· the
characterization of crypto assets under the laws of various jurisdictions around the world;

 

· the
maintenance, troubleshooting, and development of the blockchain networks underlying crypto
assets, including by miners, validators, and developers worldwide;

 

· the
ability for protocol networks to attract and retain miners or validators to secure and confirm
transactions accurately and efficiently;

 

· ongoing
technological viability and security of protocols and their associated crypto assets, smart
contracts, applications, and networks, including vulnerabilities against hacks and scalability;

 

· fees
and speed associated with processing blockchain transactions, including on the underlying
protocol networks and on exchanges and other platforms for trading;

 

· financial
strength of wholesale market participants;

 

· the
availability and cost of funding and capital;

 

· the
liquidity of over-the-counter trading desks, market-makers, exchanges, and other wholesale
dealers of crypto assets;

 

· interruptions
in service from or failures of major crypto asset exchanges and platforms;

 

· availability
of banking and payment services to support crypto-related projects;

 

· level
of interest rates and inflation in both G-10 economies and emerging markets;

 

· monetary
policies of governments, trade restrictions, and fiat currency valuation changes; and

 

· national
and international economic and political conditions.

 

 

 

 

 

 

There is no assurance that any supported crypto
asset will maintain its value or that there will be meaningful levels of interest from customers. If the demand for purchasing or selling
crypto assets declines, our business, operating results, and financial condition would be adversely affected.

 

The future development and growth of
crypto assets and protocols is subject to a variety of factors that are difficult to predict and evaluate. If the future does not develop
and grow as we expect, our business, operating results, and financial condition could be adversely affected.

 

Blockchain technology was only introduced
in 2008 and remains in the early stages of development. In addition, different protocols are designed for different purposes. Bitcoin,
for instance, was designed to serve as a peer-to-peer electronic cash system, while Ethereum was designed to be a smart contract and
decentralized application platform. Many other protocol networks—ranging from cloud computing to tokenized securities networks—have
only recently been established. The further growth and development of any crypto assets and their underlying networks and other cryptographic
and algorithmic protocols governing the creation, transfer, and usage of crypto assets represent a new and evolving paradigm that is
subject to a variety of factors that are difficult to evaluate, including:

 

· Many
protocol networks have limited operating histories, have not been validated in production,
and are still in the process of developing and making significant decisions that will affect
the design, supply, issuance, functionality, and governance of their respective tokens and
underlying blockchain networks, any of which could adversely affect their respective usefulness.

 

· Many
networks are in the process of implementing software upgrades and other changes to their
protocols, which could introduce bugs, security risks, or adversely affect the respective
crypto networks.

 

· Several
large networks, including Bitcoin and Ethereum, are developing new features to address fundamental
speed, scalability, and energy usage issues. If these issues are not successfully addressed,
or are unable to receive widespread adoption, it could adversely affect the underlying crypto
asset.

 

· Security
issues, bugs, and software errors have been identified with many protocols and their underlying
blockchain networks, some of which have been exploited by malicious actors. There are also
inherent security weaknesses in some crypto assets and their networks and protocols, such
as when creators of certain crypto networks use procedures that could allow hackers to counterfeit
tokens. Any weaknesses identified with a protocol, token or blockchain could adversely affect
its price, security, liquidity, and adoption. If a malicious actor or botnet (a volunteer
or hacked collection of computers controlled by networked software coordinating the actions
of the computers) obtains a majority of the compute or staking power on a crypto network,
as has happened in the past, it may be able to manipulate transactions, which could cause
financial losses to holders, damage the network’s reputation and security, and adversely
affect its value.

 

· The
development of new technology for mining, such as improved application-specific integrated
circuits (commonly referred to as ASICs), or changes in industry patterns, such as the consolidation
of mining power in a small number of large mining farms, could reduce the security of blockchain
networks, lead to increased liquid supply of the crypto asset token, and reduce its price
and attractiveness.

 

· If
rewards and transaction fees for miners or validators on any protocol network are not sufficiently
high to attract and retain miners, a network’s security and speed may be adversely
affected, increasing the likelihood of a malicious attack.

 

· The
governance of many decentralized blockchain networks is by voluntary consensus and open competition,
and many developers are not directly compensated for their contributions. As a result, there
may be a lack of consensus or clarity on the governance of any crypto network, a lack of
incentives for developers to maintain or develop the network, and other unforeseen issues,
any of which could result in unexpected or undesirable errors, bugs, or changes, or stymie
such network’s utility and ability to respond to challenges and grow.

 

· Many
crypto networks are in the early stages of developing partnerships and collaborations, all
of which may not succeed and adversely affect the usability and adoption of the respective
crypto asset token.

 

· Various
other technical issues have also been uncovered from time to time that resulted in disabled
functionalities, exposure of certain users’ personal information, theft of users’
assets, and other negative consequences, and which required resolution with the attention
and efforts of their global miner, user, and development communities. If any such risks or
other risks materialize, and if they are not resolved, the development and growth of crypto
assets, blockchain technology, or Bitcoin may be significantly affected and, as a result,
our business, operating results, and financial condition could be adversely affected.

 

 

 

 

 

Loss of a banking relationship could
adversely impact our business, operating results, and financial condition.

 

Athena depends on having regular and normalized
access to a bank checking account for normal business purposes and also for taking deposits of the cash received from the ATM fleet. As
a money services business registered with the Financial Crimes Enforcement Network (“FinCEN”) under the Bank Secrecy Act,
as amended by the USA PATRIOT Act of 2001, and its implementing regulations enforced by FinCEN, our banking
partners view us as a higher risk customer for purposes of their anti-money laundering programs. We may face difficulty establishing or
maintaining banking relationships due to our banking partners’ policies and some prior bank partners have terminated their relationship
with Athena. The loss of these banking partners or the imposition of operational restrictions by these banking partners and the inability
for us to utilize other redundant financial institutions may result in a disruption of business activity as well as regulatory risks.
In addition, financial institutions in the United States and globally may, because of the myriad of regulations or the perceived risks
of crypto assets, decide to not provide accounts, payments other financial services to us. Such events could negatively affect an investment
in the Shares.

 

The Company may be forced to cease operations.

 

It is possible that, due to any number of reasons,
including, but not limited to, an unfavorable fluctuation in the value of cryptographic and fiat currencies, the inability by the Company,
whether in the United States or globally, to obtain clients, the failure of commercial relationships, the failure of development of the
necessary technical environment, the failure of government actors to provide needed regulatory clarity, the failure of technology development
by third parties, or intellectual property ownership challenges, the Company may no longer be viable to operate and the Company may dissolve,
either in whole or part, or take actions that result in a dissolution event. During the past six years there have been several rumors
that regulation specifically aimed at terminating the practice of selling crypto assets via kiosks, such as the Company’s fleet
of Bitcoin ATMs, would be forthcoming. While the regulations hypothesized by these rumors have never been enacted, it remains a risk to
the Company’s principal operations and could be detrimental to an investment in the Shares.

 

Other Risk Factors Related to Our Business
Operations and Financial Position

 

Currently, there is a small use of Bitcoin
in the retail and commercial marketplace in comparison to relatively large use by speculators, thus contributing to price volatility
that could adversely affect an investment in the Shares.

 

Bitcoin and the Bitcoin Network have only
recently become accepted as a means of payment for goods and services by certain major retail and commercial outlets, and the use of
Bitcoin by consumers to pay such retail and commercial outlets remains limited. Conversely, a significant portion of Bitcoin demand is
generated by speculators and investors seeking to profit from the short- or long-term holding of Bitcoin. A lack of expansion by Bitcoin
or other crypto assets into retail and commercial markets, or a contraction of such use, may result in decreased demand for the Company’s
services or increased demand for services the Company is not able to provide, either of which could adversely affect an investment in
the Shares.

 

The Company’s assets could be stolen
and would be difficult to recover due to the nature of cash and crypto assets.

 

It is possible that, due to any number of
reasons, including, but not limited to, a robbery by either a general malcontent or an employee of the Company could adversely
affect the Company’s operations and assets. From time to time, the Company has been the victim of vandalism and targeted
attacks on our ATMs, which have resulted in loss of cash and equipment. The Company has also been the target of cyberattacks and has
suffered security breaches of its websites, email, cellphones, and other systems related to the operations of the business. On March
31, 2021, we suffered a security breach which resulted in a loss of 29 bitcoin (approximately $1.7 million of market value). We have
initiated two independent investigations of the attack with the assistance of law enforcement and outside counsel. See also Management Discussion and Analysis of Financial Condition and Results of Operations on page 31. Historically, stolen Bitcoin, crypto
assets of multiple types, and cash have been difficult to recover by law enforcement or other means due to their fundamental nature
as fungible instruments of value. At this time, we have no information if the stolen crypto assets can be recovered. The
Company’s losses may negatively affect an investment in the Company’s shares.

 

 

 

 

 

 

 

Crypto assets and funds that the Company
holds on Bitcoin exchanges could be lost, stolen, or otherwise impaired.

 

From time to time and for customary reasons
of procuring crypto assets, the Company holds assets including dollar deposits, Bitcoin, Ethereum, Tether, Litecoin, and BCH on crypto
asset exchanges. The Company carefully selects the platforms that it chooses to do business with, however this may not be sufficient
to avoid losses if those exchanges suffer losses or other impairments. In 2018, the Company had assets of less than $10,000 on the Quadriga
Exchange in Canada when Quadriga filed for bankruptcy protection following the death of its Chief Executive Officer and subsequent discovery
of its insolvency. In addition, while not applicable to the Company’s operations, several other well-known and highly regarded
exchanges have suffered similar fates. For example, in February 2014, Mt. Gox, then the largest Bitcoin exchange worldwide, filed for
bankruptcy protection in Japan after an estimated 700,000 bitcoin were stolen from its wallets. In May 2019, Binance, one of the world’s
largest exchanges was hacked, resulting in losses of approximately $40 million. Any such losses by an exchange could have a negative
impact on the financial position of the Company and adversely impact an investment in the Shares.

 

Our lack of insurance protection could
adversely impact our business, operating results, and financial condition.

 

The crypto assets held by us are not insured.
We also do not rely on insurance carriers to insure losses resulting from a breach of our physical security, cyber security, or by employee
or service provider theft since we do not carry crime and specie insurance. We only maintain a general liability insurance which does
not cover crypto assets or breaches described above. Therefore, we may suffer a loss which is not covered by insurance in damages. Such
a loss could cause a substantial business disruption of our operations, adverse reputational impact, inability to compete with our competitors,
regulatory scrutiny, and consequently, it could adversely impact an investment in our shares of common stock.

 

The Company operates in locations outside of
the United States and, as such, is subject additional risks with respect to enforcement of its contractual rights.

 

We currently operate and intend to grow our operations in a number
of jurisdictions outside of the United States. Laws and business practices that favor local competitors or prohibit or limit foreign ownership
of certain businesses, or our failure to adapt our practices, systems, processes, and business models effectively to the traveler and
supplier preferences (as well as the regulatory and tax landscapes) of each country into which we expand, could impede our ability to
enter into, negotiate or enforce contracts in those markets. In addition to the other risks described in this prospectus, our company’s
international operations would be subject to numerous other risks, including, but not limited to, weaker enforcement of our company’s
contractual rights, longer payment cycles, and difficulties in collecting accounts receivable.

 

The countries, we operate in, may or may
not have stable economies, stable banking sectors, or stable governments which may or may not permit us to repatriate profits, maintain
ownership of our business or its assets, or continue operations.

 

From time to time, certain governments have
seized foreign companies, their assets, and or their operations. It is possible for us to face significant losses if such an event occurs,
either specific to us or broadly across the entire country or industry in which we operate. We may, for example no longer be permitted
to purchase additional crypto assets, or operate our machines, or return capital or profits to our parent company in the United States.
This may result in a total and complete loss of our assets within that country as well as further costs to continue to pay our existing
liabilities within that country.

 

The countries we operate in may not have
stable governments or may face significant political, social, or civil unrest.

 

The countries where the Company operates,
or may choose to operate in the future, may face significant periods of political, military, social, or civil unrest. This may result
in the destruction of the Company’s property, the destruction of the Company’s other assets, or other harm to the Company
and its personnel, which may cause losses or for the Company to incur significant liabilities. Nationalization of certain industries
has occurred in some of the countries where Athena currently operates. The loss of access to those nationalized assets may adversely
impact an investment in the Shares.

 

Fluctuations in currency exchange rates
could harm our operating results and financial condition.

 

Revenue generated and expenses incurred from our
international operations are often denominated in the currencies of the local countries. Accordingly, changes in the value of foreign
currencies relative to the U.S. dollar can affect our revenue and operating results reflected in our U.S. dollar-denominated consolidated
financial statements. Our financial results are also subject to changes in exchange rates that impact the settlement of transactions in
non-local currencies. As a result, it could be more difficult to detect underlying trends in our business and operating results. To the
extent that fluctuations in currency exchange rates cause our operating results to differ from the expectations of investors, the market
price of the Shares could be adversely impacted. To date, we have not engaged in currency hedging activities to limit the risk of exchange
fluctuations. Even if we use derivative instruments to hedge exposure to fluctuations in foreign currency exchange rates, the use of such
hedging activities may not offset any or more than a portion of the adverse financial effects of unfavorable movements in foreign exchange
rates over the limited time the hedges are in place and may introduce additional risks if we are unable to structure effective hedges
with such instruments.

 

 

 

 

 

 

Adverse economic conditions may affect
our business.

 

Our performance is subject to general economic
conditions, and their impact on the digital currency markets and our customers. The United States and other international economies have
experienced cyclical downturns from time to time in which economic activity declined resulting in lower consumption rates, restricted
credit, reduced profitability, weaknesses in financial markets, bankruptcies, and overall uncertainty with respect to the economy. The
impact of general economic conditions on the Company is highly uncertain and dependent on a variety of factors, including global adoption
of cryptocurrencies, central bank monetary policies, and other events beyond our control. Geopolitical developments, such as trade wars
and foreign exchange limitations can also increase the severity and levels of unpredictability globally and increase the volatility of
global financial and digital currency markets. To the extent that conditions in the general economic and digital currency markets materially
deteriorate, our ability to attract and retain customers may suffer. 

 

The COVID-19 pandemic could have an adverse
effect on our business, operating results, and financial condition.

 

We are responding to the global outbreak of
COVID-19 by taking steps to mitigate the potential risks to us posed by its spread and the impact of the restrictions put in place by
governments to protect their populations. Our employees and service providers have transitioned to work-from-home. This subjects us to
heightened operational risks. For example, technologies in our employees’ and service providers’ homes may not be as robust
as in our offices and could cause the networks, information systems, applications, and other tools available to employees and service
providers to be more limited or less reliable than in our offices. Further, the security systems in place at our employees’ and
service providers’ homes may be less secure than those used in our offices, and while we have implemented technical and administrative
safeguards to help protect our systems as our employees and service providers work from home, we may be subject to increased cybersecurity
risk, which could expose us to risks of data or financial loss, and could disrupt our business operations. There is no guarantee that
the data security and privacy safeguards we have put in place will be completely effective or that we will not encounter risks associated
with employees and service providers accessing company data and systems remotely. We also face challenges due to the need to operate
with the remote workforce and are addressing those challenges to minimize the impact on our ability to operate.

 

In addition, the continued spread of COVID-19
and the imposition of related public health measures have resulted in, and is expected to continue to result in, increased difficulty
in retail or in-store operations, including our ability to ship, install, and maintain our Bitcoin ATM fleet. Some of the retail locations,
such as shopping malls, where we have placed our Bitcoin ATMs have closed either permanently or temporarily due to the spread of COVID-19
and the subsequent response by governments and businesses. We also rely on third party service providers, including our armored car services,
to perform certain functions. Any disruptions to a service providers’ business operations resulting from business restrictions,
quarantines, or restrictions on the ability of personnel to perform their jobs could have an adverse impact on our service providers’
ability to provide services to us. The continued spread of COVID-19 and efforts to contain the virus could result in the death of our
customers or employees, adversely impact our strategic business plans and growth strategy, reduce demand for or availability of our products
and services, reduce the availability and productivity of our employees, service providers, and third-party resources, cause us to experience
an increase in costs due to emergency measures, and otherwise adversely impact our business.

 

Risk Factors
Related to Our Operations in El Salvador

 

Expansion of business operations in El
Salvador may not produce the positive results as planned.

 

We have established significant operations
in El Salvador to support the country’s efforts to use Bitcoin as legal tender. However, there are many factors that could disrupt
the implementation of Bitcoin Law in El Salvador, and as a result, our operations in El Salvador. Any of such disruptions can have a negative
impact on the financial position of the Company. They could jeopardize our expansion plan and be detrimental to our business.

 

Those risks, as summarized below include:

 

· Exposure
to Bitcoin volatility
. While Bitcoin can be used as a speculative asset to generate
significant gains, it can also generate major losses. Bitcoin pricing has fluctuated rom
more than $63,000 per Bitcoin on November 15, 2021 to less than $32,000 on May 10, 2022.
Holding or transacting in such an unstable asset is a particularly risky for people with
low incomes, who can ill afford to sustain price swings as large as 30% in a single day and
may become victims of a significant collapse. If the savings of a whole nation were cut by
a third in two months, it would be a destabilizing event for the country and its Bitcoin
Law.

 

 

 

 

 

 

· Depletion of banking assets. In today’s El Salvador, banks connect savers and
borrowers. If most Salvadorans start using Bitcoin, their savings will be stored in digital wallets away from potential borrowers who
would otherwise use it to fund projects. Massive adoption of Bitcoin would likely drain banks of savings and raise the cost of
borrowing for companies and individuals, who will face higher interests. If that occurs, the economy of El Salvador and
implementation of the Bitcoin Law can be negatively affected.

 

· Lack
of transparency/money laundering.
Adopting Bitcoin as legal tender is not without certain
challenges or risks since Bitcoin’s practical implementation has yet to be defined
by regulators. Internationally, the cryptocurrency has been used for money laundering
and to facilitate illegal activities. The intergovernmental Financial Action Task Force (“FATF”)
may increase monitoring of El Salvadoran banks, businesses, and other financial institutions.
The FATF is the international “money laundering and terrorist financing watchdog.”
It reviews countries’ anti-money laundering and counter-financing terrorism practices.
If the FATF determines that a country is exposed to financial crime, the flagged country
is placed on either the list of “Jurisdictions under Increased Monitoring,” known
as the “grey list,” or the list of “Jurisdictions subject to a Call for
Action,” known as the “black list.” When a country is placed on the
grey list, it must cooperate with increased FATF monitoring. When a country is placed
on the black list, the FATF urges its 39 member nations and over 200 affiliated nations to
apply enhanced due diligence and impose countermeasures, such as sanctions. From an FATF
regulatory perspective, El Salvador has been in full compliance, however, that may likely
change after the Bitcoin Law has been fully implemented. For example, the FATF mandates that
the parties engaging in virtual-asset transactions provide complete and sufficient know-your-customer
information. It also requires that senders and recipients of virtual assets obtain accurate
knowledge and information about “the transaction, the source of funds, and the relationship
with the counterparty.” The chances of Bitcoin transactions meeting such requirements
are unlikely and El Salvador may be subject to sanctions.

  

· Loss
of central bank reserves.
El Salvador currently carries
a large debt burden (about 65% of GDP) and has a challenging amortization schedule, with $800 million due in January 2023. To navigate
this difficult fiscal environment during the pandemic, El Salvador has reached out to the International Monetary Fund (“IMF”)
for a $1.3 billion financing package. However, the IMF opposes the adoption of Bitcoin as a legal tender. Thus, the funding program could
be put in jeopardy at a time when El Salvador is running out of financial alternatives. Furthermore, the IMF has warned against
adopting cryptocurrencies as legal tender, citing risks to macroeconomic stability, financial integrity, consumer protection and the
environment (creating Bitcoin consumes large amounts of electricity). The World Bank turned down a request to help advise El Salvador
on Bitcoin. Moody’s rating agency has downgraded the country’s debt further from B3 to Caa1, and its outlook remains negative.
Those factors may negatively affect the economy of El Salvador and disrupt the implementation of the Bitcoin Law.

 

· Continued Negative Publicity in the Media with respect to Chivo S.A.
de C.V, the Chivo Ecosystem, of Bitcoin ATMs in general, or of the Company’s services could have a material adverse effect on our
business.
The government of El Salvador, through a government owned company—Chivo S.A. de C.V, operate the Chivo digital wallet. The government purchased software and related services from the Company and used this software from the launch of the Chivo digital wallet in September of 2021 until December of 2021. According to media reports, the Chivo company’s operation of the Chivo digital wallet is not subject to public reporting or auditing by a banking regulator. Therefore, there is no way for an outside observer to know that the assets held by Chivo S.A. de C.V. are sufficient to cover the liabilities (user balances) of the Chivo digital wallet. If there are negative views presented in the news about the assets held by Chivo S.A. de C.V, or of the quality of its service offerings, or its lack of transparency, or fraud or identity theft connected with the usage of the Chivo digital wallet, or any reported problems related to the Chivo digital wallet (either the version written by the Company or any subsequent version not using the Company’s Intellectual Property), then the Company’s reputation could be damaged which may negatively affect an investment in the Shares.

 

· Failure to maintain sufficient cash
in Chivo branded ATMs to mee demand could have a material adverse effect on our reputation.
Chivo S.A. de C.V. also directs the
Company as to how much physical cash should be loaded into the Chivo ATMs in El Salvador for the purpose of ATM users retrieving
U.S. dollar currency in exchange for their Bitcoin or dollars held in the Chivo digital wallet. If for any reason, there is not sufficient
physical cash loaded into a Chivo ATM to meet the total demand for such cash, the ATM will be unable to initiate additional transactions
to dispense cash to a user and the user will see the machine as non-functional. This could create negative impression of the Chivo
Ecosystem, of Bitcoin ATMs in general, of the Company’s services, or the Company’s reputation and negatively affect an
investment in the Shares.

 

· Capital flight. Bitcoin Law could facilitate a capital
flight, especially during a crisis. Many emerging markets control the flow of capital in and out of their countries to avoid a macroeconomic
crisis or to prevent one from worsening. However, Bitcoin can facilitate such a flight: Once dollars are converted to Bitcoin, they
can easily be sent to anyone in the world, without any control or tracking. Such an event would have a negative effect on the economy of El Salvador.

 

· Environmental concerns about Bitcoin mining. The system on which Bitcoin is currently based consumes large amounts of electricity, making
it particularly taxing for the environment. President Bukele believes that the country’s cheap, clean, and renewable geothermal
energy from volcanoes can power Bitcoin mining rigs, thus reducing its carbon footprint. It is not clear at this time if such a solution would solve the
environmental concerns.

 

 

 

 

 

 

Political and economic developments in
El Salvador may adversely affect Bitcoin Law.

 

El Salvador’s Bitcoin Law has been greeted with
skepticism from both Salvadorans and international financial institutions. The population might not fully embrace Bitcoin. Requiring
every business to accept Bitcoin for goods and services without adequate access to technology, may be a difficult obstacle to overcome
and Bitcoin Law can be changed if it remains unpopular under a successor administration. Any of these concerns could disrupt our
operations in El Salvador and have a negative impact on the financial position of the Company. Although several political leaders around
the globe have voiced support for the Bitcoin Law enacted by El Salvador, and cryptocurrencies such as Bitcoin are widely used and accepted
as forms of payment in many countries, only one other government (Central African Republic) has taken official steps to adopt Bitcoin
as legal tender.

 

There is political discontent in El Salvador
with President Bukele’s ouster of Supreme Court judges and the potential for the president to seek a second consecutive term. The
presidential period is five years in El Salvador. Consecutive re-election is not permitted, though previously elected presidents may
run for a second, non-consecutive term. Recently, El Salvador’s top court and its election authority have removed what seemed
to be a constitutional ban on consecutive presidential reelection, setting the stage for President Nayib Bukele to potentially seek
a second term in 2024. If there is a change in El Salvador’s administration after 2024, it may negatively affect Bitcoin Law
and our operations in El Salvador.

 

Our contracts with the El Salvador government
may be negatively impacted

 

We have entered into agreements with El Salvador’s
Treasury department, pursuant to which we have installed and are operating 200 Chivo Bitcoin ATMs in El Salvador, 10 Chivo Bitcoin ATMs
at El Salvador consulates in the U.S., 45 Chivo Bitcoin ATMs in other U.S. locations (as of fiscal year end December 31, 2021), importing
and delivering 950 Chivo POS terminals for local businesses in El Salvador to transact with Bitcoin, and developing and maintaining the
software for the Chivo digital wallet. Each obligation comes with its own set of operational risks in addition to risks set forth herein,
including but not limited to the volatile nature of crypto assets, data breach and crypto hacks, fraud conducted by users of the services
offered by the government of El Salvador, changes in U.S. and foreign laws and regulations, talent acquisition and retention, and general
economic conditions. If we fail to fulfil our contractual obligations, our agreements may be terminated which may negatively impact
our financial standing and reputation. Our current agreements may also be modified or terminated by El Salvador’s Department of
Treasury for any reason including but not limited to regime change, additional competition, and loss of political support. Any such unfavorable
change in our business operations in El Salvador, including the termination of any contracts with the government of El Salvador, would
adversely affect our revenues and profitability, and could negatively affect an investment in our shares of common stock.

 

Risk Factors Related to the Bitcoin Network,
Wallets, Bitcoin, and Crypto Assets

 

Bitcoin, and most other crypto assets based
on public key cryptography, are controllable only by the possessor of both the unique public key and private key relating to the local
or online digital wallet in which the bitcoin are held.

 

While the Bitcoin Network, and similar blockchain
protocol networks, require a public key relating to a digital wallet to be published when used in a spending transaction, private keys
must be safeguarded and kept private in order to prevent a third party from accessing the bitcoin held in such wallet. To the extent a
private key is lost, destroyed, or otherwise compromised and no backup of the private key is accessible, Athena will be unable to access
the Bitcoin, or other digital currency, held in the related digital wallet. Any loss of private keys relating to digital wallets used
to store Athena’s Bitcoin, or other crypto assets, could adversely affect an investment in the Shares.

 

The future and development of the Bitcoin
Protocol and other blockchain technologies are subject to a variety of factors that are difficult to evaluate.

 

The further development and acceptance of
the Bitcoin Network and other cryptographic and algorithmic protocols governing the issuance of transactions in bitcoin and other crypto
asset, which represent a new and rapidly changing industry, are subject to a variety of factors that are difficult to evaluate. Athena
does not participate in the development of the Bitcoin Network and has little to no influence over the software developers who write
the code or the miners who run the Bitcoin Network. The slowing or stopping of the development or acceptance of the Bitcoin Network may
adversely affect an investment in the Shares.

 

 

 

 

 

 

Tether is a token issued by a private company
and may not have any intrinsic value.

 

Tether is a “stablecoin” and the
price of one Tether has historically been about one U.S. dollar. Stablecoins are digital assets designed to have a stable value over time
as compared to typically volatile crypto assets, and are typically marketed as being pegged to a fiat currency, such as the U.S. dollar.
According to the official Tether website, as of May 5, 2021, approximately $25.3 billion worth of U.S. Dollar Tether (“USDT”)
has been issued by a smart contract on the Ethereum network as an ERC-20-compatible token. Some have argued that some stablecoins, particularly
Tether, are improperly issued without sufficient backing, and have also argued that those associated with certain stablecoins may be involved
in laundering money. On February 17, 2021, the New York Attorney General entered an agreement with Tether’s operators, requiring
them to cease any further trading activity with New York persons and pay $18.5 million in penalties for false and misleading statements
made regarding the assets backing Tether. Volatility in stablecoins, operational issues with stablecoins (for example, technical issues
that prevent settlement), concerns about the sufficiency of any reserves that support stablecoins, or regulatory concerns about stablecoin
issuers or intermediaries, such as crypto asset spot markets, that support stablecoins, could impact any individual’s willingness
to purchase Tether from the Company and may adversely affect an investment in the Shares.

 

A temporary or permanent blockchain “fork”
to any supported crypto asset could adversely affect our business.

 

Blockchain protocols, including Bitcoin,
Ethereum, and Litecoin, are open source. Any user can download the software, modify it, and then propose that Bitcoin, Ethereum, Litecoin,
or other blockchain protocols users and miners adopt the modification. When a modification is introduced and a substantial majority of
users and miners consent to the modification, the change is implemented and the Bitcoin, Ethereum, Litecoin, or other blockchain protocol
networks, as applicable, remain uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed
modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known
as a “fork” (i.e., “split”) of the impacted blockchain protocol network and respective blockchain, with one prong
running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two
parallel versions of the Bitcoin, Ethereum, Litecoin, or other blockchain protocol network, as applicable, running simultaneously, but
with each split network’s crypto asset lacking interchangeability.

 

Both Bitcoin and Ethereum protocols have been
subject to “forks” that resulted in the creation of new networks, including Bitcoin Cash ABC, Bitcoin Cash SV, Bitcoin Diamond,
Bitcoin Gold, Ethereum Classic, and others. Some of these forks have caused fragmentation among platforms as to the correct naming convention
for forked crypto assets. Due to the lack of a central registry or rulemaking body, no single entity can dictate the nomenclature of forked
crypto assets, causing disagreements and a lack of uniformity among platforms on the nomenclature of forked crypto assets, and which results
in further confusion to customers as to the nature of assets they hold on platforms. In addition, several of these forks were contentious
and as a result, participants in certain communities may harbor ill will towards other communities. As a result, certain community members
may take actions that adversely impact the use, adoption, and price of Bitcoin, Ethereum, Litecoin, or any of their forked alternatives.

 

Furthermore, hard forks can lead to new security
concerns. For instance, when the Ethereum and Ethereum Classic networks split in July 2016, replay attacks, in which transactions from
one network were rebroadcast on the other network to achieve “double-spending”, plagued platforms that traded Ethereum through
at least October 2016, resulting in significant losses to some crypto asset platforms. Similar replay attacks occurred in connection
with the Bitcoin Cash and Bitcoin Cash SV network split in November 2018. Another result of a hard fork is an inherent decrease in the
level of security due to the splitting of some mining power across networks, making it easier for a malicious actor to exceed 50% of
the mining power of that network, thereby making crypto assets that rely on proof-of-work more susceptible to attack, as has occurred
with Ethereum Classic.

 

Future forks may occur at any time. A fork
can lead to a disruption of networks and our information technology systems, cybersecurity attacks, replay attacks, or security weaknesses,
any of which can further lead to temporary or even permanent loss of our assets.

 

 

 

 

 

 

From time to time, we may encounter technical
issues in connection with the integration of supported crypto assets and changes and upgrades to their underlying networks, which could
adversely affect our business.

 

To support any crypto asset or blockchain token,
a variety of front and back-end technical and development work is required to implement our wallet, custody, pricing, transfer, accounting,
and other solutions for our Bitcoin ATM fleet, and to integrate such supported crypto asset with our existing infrastructure. For certain
crypto assets, a significant amount of development work is required and there is no guarantee that we will be able to integrate successfully
with any existing or future crypto asset, token, or stable coin. In addition, such integration may introduce software errors or weaknesses
into our platform, including our existing infrastructure. Even if such integration is initially successful, any number of technical changes,
software upgrades, soft or hard forks, cybersecurity incidents, or other changes to the underlying blockchain network may occur from time
to time, causing incompatibility, technical issues, disruptions, or security weaknesses to our platform. If we are unable to identify,
troubleshoot and resolve any such issues successfully, we may no longer be able to support such crypto assets, our assets may be frozen
or lost, the security of our crypto asset wallets may be compromised, and technical infrastructure may be affected, all of which could
adversely impact our business.

 

If miners or validators of any crypto
asset network, either that we provide to customers or hold for other reasons, demand high transaction fees, our operating results may
be adversely affected.

 

We pay miner fees when transmitting crypto assets
including Bitcoin to customers upon completion of their purchase. In addition, we also pay miner fees when we move crypto assets for various
operational purposes, such as when we transfer Bitcoin between our regional wallets. However, miner fees can be unpredictable. For instance,
in 2017, Bitcoin miner fees increased from approximately $0.35 per transaction in January 2017 to over $50 per transaction in December
2017. Even though Bitcoin’s miner fees have since decreased to $18 per transaction as of March 4, 2021, if the demand for Bitcoin
remains at current levels, we could experience high costs in excess of our historical performance. Although we attempt to adjust our pricing
to pass through these expenses to our customers, we have in the past incurred, and expect to incur from time to time, losses associated
with the payment of miner fees in excess of what we charge our customers, resulting in adverse impacts on our operating results.

 

We are subject to an extensive and rapidly
evolving regulatory environment, and if a particular crypto asset we transact or transacted in is characterized as a “security”,
we may be subject to regulatory scrutiny, investigations, fines, and other penalties, which may adversely affect our business, operating
results, and financial condition.

 

The SEC and its staff have taken the position
that certain crypto assets fall within the definition of a “security” under the U.S. federal securities laws. The legal test
for determining whether any given crypto asset is a security is a highly complex, fact-driven analysis that evolves over time, and the
outcome is difficult to predict. The SEC generally does not provide advance guidance or confirmation on the status of any particular
crypto asset as a security. Furthermore, the SEC’s views in this area have evolved over time and it is difficult to predict the
direction or timing of any continuing evolution. It is also possible that a change in the governing administration or the appointment
of new SEC commissioners could substantially impact the views of the SEC and its staff. Public statements by senior officials at the
SEC indicate that the SEC does not intend to take the position that Bitcoin or Ether are securities (in their current form). Bitcoin
and Ethereum are the only crypto assets as to which senior officials at the SEC have publicly expressed such a view. Moreover, such
statements are not official policy statements by the SEC and reflect only the speakers’ views, which are not binding on the SEC
or any other agency or court and cannot be generalized to any other crypto asset. With respect to all other crypto assets, there is currently
no certainty under the applicable legal test that such assets are not securities, notwithstanding the conclusions we may draw based on
our risk-based assessment regarding the likelihood that a particular crypto asset could be deemed a “security” under applicable
laws. Similarly, though the SEC’s Strategic Hub for Innovation and Financial Technology published a framework for analyzing whether
any given crypto asset is a security in April 2019, this framework is also not a rule, regulation or statement of the SEC and is not
binding on the SEC.

 

We currently offer only Bitcoin, Ethereum, Litecoin,
and BCH for sale at all our ATM machines. We also operate an over-the-counter (“OTC”) desk for private clients and trade
customers of the Company. Since 2019, we have been typically buying and selling Bitcoin through our OTC desk, but we have also facilitated
transactions in Ethereum, Litecoin, and in some cases : Ankr (1 transaction in 2021), Monero (1 transaction in 2019), Bitcoin SV
(1 transaction in each 2019 and 2020), Ripple (1 transaction in 2019), Siacoin (3 transactions in 2019), Tether (5 transactions in
2021, 5 transactions in 2022), and Tron (1 transaction in 2019). As of the date of this prospectus, we do not transact, or make offers
to transact to our customers, in any crypto assets except Bitcoin, Ethereum, Tether, Litecoin, and BCH. We will update this prospectus
if we decide to transact in other crypto assets. Such a change would only happen if there were significant customer demand for a specific
crypto asset and that crypto asset was available to us through multiple trading partners, digital asset exchanges and digital asset brokers.

 

 

 

 

 

 

The classification of a crypto asset as a security
under applicable law has wide-ranging implications for the regulatory obligations that flow from the offer, sale, trading, and clearing
of such assets. For example, a crypto asset that is a security in the United States may generally only be offered or sold in the United
States pursuant to a registration statement filed with the SEC or in an offering that qualifies for an exemption from registration. Persons
that effect transactions in crypto assets that are securities in the United States may be subject to registration with the SEC as a “broker”
or “dealer.” Platforms that bring together purchasers and sellers to trade crypto assets that are securities in the United
States are generally subject to registration as national securities exchanges, or must qualify for an exemption, such as by being operated
by a registered broker-dealer as an alternative trading system, or ATS, in compliance with rules for ATSs. Persons facilitating clearing
and settlement of securities may be subject to registration with the SEC as a clearing agency. If Bitcoin, Ether, Litecoin, and BCH
or any other crypto asset we transacted in the past as listed above, is deemed to be a security under any U.S. federal, state, or foreign
jurisdiction, or in a proceeding in a court of law or otherwise, it may have adverse consequences for such supported crypto asset (if
it is still being used in our transactions) or for our Company if it is determined that certain securities laws were violated and we
may be subject to regulatory scrutiny, investigation and penalties. Moreover, the networks on which such supported crypto assets are
utilized may be required to be regulated as securities intermediaries, and subject to applicable rules, which could effectively render
the network impracticable for its existing purposes. Further, it could draw negative publicity and a decline in the general acceptance
of the crypto asset. Also, it may make it difficult for such supported crypto asset to be traded, cleared, and custodied as compared
to other crypto asset that are not considered to be securities. Additionally, new laws, regulations, or interpretations may result in litigation, regulatory investigations, and enforcement or other actions, including preventing or delaying us from offering
certain products or services, or could impact how we offer such products and services. Foreign jurisdictions may have similar regulations
and licensing, registration, and qualification requirements.

 

Risk Factors Related to Current and Future
Regulations and Other Law Enforcement Actions

 

The regulations that govern our primary
business operations are in flux and could change in unpredictable ways that negatively affect our business operations, demand for our
services, or our financial position.

 

Current regulations acknowledge and allow for
companies to sell Bitcoin and other crypto assets in the United States and other countries where Athena operates. If regulations change
to disallow the sale of Bitcoin or other crypto assets such a change could have a negative impact on revenues and adversely affect an
investment in the Shares. Current regulations require Know Your Customer (“KYC”) information be collected as part of a Customer
Information Program (“CIP”). If regulations change and require significantly more information to be collected from customers,
this change may have a negative impact on customer behavior and could adversely affect an investment in the Shares.

 

Sanctions could cause us to cease operations
in foreign countries or dealings with foreign citizens.

 

Sanctions, such as those promulgated by the U.S.
Department of Treasury, could be brought against countries where the Company operates, or against citizens of certain countries regardless
of where they reside. Ceasing operations in such a country would have a negative impact on revenues and the Company may also incur
extraordinary costs which may adversely impact an investment in the Shares.

 

Heightened scrutiny by regulators could
be detrimental to the operations of the Company or its brand image.

 

Our existing operations and any future operations
or investments may become the subject of heightened scrutiny by regulators, stock exchanges and other authorities in the United States
or globally. As a result, we may be subject to significant direct and indirect interaction with public officials. There can be no assurance
that this heightened scrutiny will not in turn lead to the imposition of certain restrictions on our ability to operate or invest in
the United States or any other jurisdiction, in addition to those described herein. Further any negative connotations directed at the
Company by such public officials could be detrimental to the Company’s brand image and adversely impact an investment in the Shares.

 

 

 

 

 

 

We or our assets may become subject to
federal and state asset forfeiture laws which could negatively impact our business operations or financial position.

 

Violations of any federal laws and regulations
could result in significant fines, penalties, administrative sanctions, convictions, or settlements arising from civil proceedings conducted
by either the federal government or private citizens, or criminal charges, including, but not limited to, seizure of assets, disgorgement
of profits, cessation of business activities or divestiture.

 

As an entity that conducts business in cash
(physical currency), we are potentially subject to federal and state forfeiture laws (criminal and civil) that permit the government
to seize the proceeds of suspected criminal activity. Civil forfeiture laws could provide an alternative for the federal government or
any state (or local police force) that wants to discourage residents from conducting transactions with crypto asset related businesses.
Also, an individual can be required to forfeit property suspected to be the proceeds of a crime even if the individual is not charged
or convicted of a crime. Many law enforcement agencies consider large amounts of cash to be suspicious of criminal activity and have
been known to seize such property when discovered. Any seizure or forfeiture of the Company’s assets, even if only temporary, could
disrupt its normal operations or financial position and negatively affect an investment in the Shares.

 

Regulators and payment processors have
historically taken actions relating to access to banking services, which could materially adversely affect our business.

 

Actions by the U.S. Department of Justice (the
“Justice Department”), the Federal Deposit Insurance Corporation, (“FDIC”), and certain state regulators
beginning in 2013, referred to as “Operation Choke Point,” appear to have been intended to discourage banks and payment processors
from providing access to banking for certain businesses that are considered high-risk. This heightened regulatory scrutiny by
the Justice Department, the FDIC and other regulators has caused various banks and payment processors to cease doing business with Bitcoin
ATM companies or companies who do business with Bitcoin ATM companies, without consideration of the actual risk to the banks or processors,
simply to avoid heightened federal and state regulatory scrutiny. The operation was officially ended in August 2017; however, future discouragement
by the Justice Department, the FDIC, or the Office of the Comptroller of the Currency (“OCC”) could cause the Company, or
its service providers including locations where the Company places its fleet of Bitcoin ATMs, to have restricted access to the U.S. financial
system as provided by banks, payment providers, or other financial intermediaries, and that could have a negative impact on the Company’s
operations, its ability to perform its contractual obligations, or its financial position.

 

If the Company is unable to satisfy data
protection, security, privacy, and other government- and industry-specific requirements, its growth could be harmed.

 

There are several data protections, security,
privacy, and other government and industry-specific requirements, including those that require companies to notify individuals of data
security incidents involving certain types of personal data, enacted across various jurisdictions globally. In addition, our agreements
to deliver software may have requirements for the protection of user data. Security compromises or cyberattacks could harm the Company’s
reputation, erode market confidence in the effectiveness of its security measures and reliability of its endorsements, negatively impact
its ability to attract new clients, or cause clients to stop using the Company’s services.

 

The nature of our business requires the
application of complex financial accounting rules, and there is limited guidance from accounting standard setting bodies. If financial
accounting standards undergo significant changes, our operating results could be adversely affected.

 

The accounting rules and regulations that we must
comply with are complex and subject to interpretation by the Financial Accounting Standards Board (the “FASB”), the SEC, and
various bodies formed to promulgate and interpret appropriate accounting principles. In addition to the United States, the Company operates
in several Latin American countries that may or may not offer similar accounting treatments to some of the Company’s transactions.
This could have a significant effect on the ability of the Company to offer comparable results segmented by country in the future. A change
in these principles or interpretations could have a significant effect on our reported financial results and may even affect the reporting
of transactions completed before the announcement or effectiveness of a change. Recent actions and public comments from the FASB and the
SEC have focused on the integrity of financial reporting and internal controls. In addition, many companies’ accounting policies
are being subject to heightened scrutiny by regulators and the public. Further, there has been limited precedents for the financial accounting
of crypto assets and related valuation and revenue recognition, and no official guidance has been provided by the FASB or the SEC. As
such, there remains significant uncertainty on how companies can account for crypto asset transactions, crypto asset balances, derivatives
and liabilities denominated in crypto asset tokens, and related revenue and expense. Uncertainties in or changes to regulatory or financial
accounting standards could result in the need to change our accounting methods and restate our financial statements and impair our ability
to provide timely and accurate consolidated financial information, which could adversely affect our financial statements, result in a
loss of investor confidence, and more generally impact our business, operating results, and financial position.

 

 

 

 

 

 

Risk Factors Related to Intellectual
Property

 

Our intellectual property rights are
valuable, and any inability to protect them could adversely impact our business, operating results, and financial condition.

 

Our business depends in large part on our
proprietary technology and our brand. We rely on, and expect to continue to rely on, a combination of trademark, trade dress, domain
name, copyright, and trade secret and laws, as well as confidentiality and license agreements with our employees, contractors, consultants,
and third parties with whom we have relationships, to establish and protect our brand and other intellectual property rights. However,
our efforts to protect our intellectual property rights may not be sufficient or effective. Our proprietary technology and trade secrets
could be lost through misappropriation or breach of our confidentiality and license agreements, and any of our intellectual property
rights may be challenged, which could result in them being narrowed in scope or declared invalid or unenforceable. There can be no assurance
that our intellectual property rights will be sufficient to protect against others offering products, services, or technologies that
are substantially like ours and that compete with our business.

 

We may in the future be sued by third
parties for alleged infringement of their proprietary rights.

 

In recent years, there has been considerable
patent, copyright, trademark, domain name, trade secret and other intellectual property development activity in the crypto economy, as
well as litigation, based on allegations of infringement or other violations of intellectual property, including by large financial institutions.
Furthermore, individuals and groups (collectively “patent trolls”) can purchase patents and other intellectual property assets
for the purpose of making claims of infringement to extract settlements from companies like ours. Our use of third-party intellectual
property rights also may be subject to claims of infringement or misappropriation. We cannot guarantee that our internally developed
or acquired technologies and content do not or will not infringe the intellectual property rights of others. From time to time, our competitors
or other third parties may claim that we are infringing upon or misappropriating their intellectual property rights, and we may be found
to be infringing upon such rights. Any claims or litigation could cause us to incur significant expenses and, if successfully asserted
against us, could require that we pay substantial damages or ongoing royalty payments, prevent us from offering our products or services
or using certain technologies, force us to implement expensive workarounds, or impose other unfavorable terms. We expect that the occurrence
of infringement claims is likely to grow as the market grows and matures. Accordingly, our exposure to damages resulting from infringement
claims could increase and this could further exhaust our financial and management resources. Further, during any litigation, we may make
announcements regarding the results of hearings and motions, and other interim developments. If securities analysts and investors regard
these announcements as negative, the market price of our common stock may decline. Even if intellectual property claims do not result
in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources
of our management and require significant expenditures. Any of the foregoing could prevent us from competing effectively and could have
an adverse effect on our business, operating results, and financial condition and negatively affect an investment in the Shares.

 

Risk Factors Related to Our Employees
and Other Service Providers

 

Our management team has limited experience
managing a public company.

 

Our management team has limited experience managing
a publicly traded company, interacting with public company investors, and complying with the increasingly complex laws pertaining to public
companies. Our management team may not successfully or efficiently manage our transition to being a public company subject to significant
regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts, Reddit
commenters, Twitter posters, and investors. These new obligations and constituents will require significant attention from our senior
management and could divert their attention away from the day-to-day management of our business, which could adversely affect our business,
operating results, and financial position.

 

The loss of one or more of our key personnel,
or our failure to attract and retain other highly qualified personnel in the future, could adversely impact our business, operating results,
and financial position.

 

We operate in a new industry that is not widely
understood and requires highly skilled and technical personnel. We believe that our future success is highly dependent on the talents
and contributions of our senior management team, including Eric Gravengaard, our co-founder and Chief Executive Officer, members of our
executive team, and other key employees across operations, customer support, finance, and compliance. Our future success depends on our
ability to attract, develop, motivate, and retain highly qualified and skilled employees. Due to the nascent nature of the Bitcoin ATM
market, the pool of qualified talent is extremely limited, particularly with respect to executive talent, engineering, cross-border operations,
risk management, and financial regulatory expertise. We face intense competition for qualified individuals from numerous software, finance
and other technology companies. To attract and retain key personnel, we incur significant costs, including salaries, benefits and equity
incentives. Even so, these measures may not be enough to attract and retain the personnel we require to operate our business effectively.
The loss of even a few qualified employees, or an inability to attract, retain and motivate additional highly skilled employees required
for the planned expansion of our business could adversely impact our operating results and impair our ability to grow.

 

 

 

 

 

 

We currently rely and are dependent on
one third-party service provider for certain aspects of our operations, and any interruptions in services provided by that third party
may impair our ability to support our customers.

 

We rely on and are dependent on one third party,
Genesis Coin, in connection with many aspects of our business operations, including primarily the supply of our Bitcoin ATMs and the
development of related software systems that provide advanced security protections, which are critical to our operations. Although
we use other suppliers of Bitcoin ATMs, primarily outside the U.S., our main income is generated by the ATMs that we purchase from Genesis
Coin. Because we rely heavily on one third party to provide these services and to facilitate certain of our business activities, we face
increased operational risks. We do not control the operation of that third party. That third party may be subject to financial, legal,
regulatory, and labor issues, cybersecurity incidents, break-ins, computer viruses, denial-of-service attacks, sabotage, acts of vandalism,
privacy breaches, service terminations, disruptions, interruptions, and other misconduct. They may also be vulnerable to damage or interruption
from human error, power loss, telecommunications failures, fires, floods, earthquakes, hurricanes, tornadoes, pandemics (including the
COVID-19 pandemic) and similar events. In addition, we do not have a written contract with that third party and our relationship is based
on oral agreement and previous working relationship. That third party may breach such oral agreement with us, refuse to continue to provide
their services to us, take actions that degrade the functionality of our services, impose additional costs or requirements on us, or
give preferential treatment to competitors. There can be no assurance that such third party that provides services to us will continue
to do so on acceptable terms, or at all. If such a third party does not adequately or appropriately provide its services or perform its
responsibilities to us, we may be unable to procure alternatives in a timely and efficient manner and on acceptable terms, or at all,
and we may be subject to business disruptions, losses or costs to remediate any of the deficiencies, customer dissatisfaction, reputational
damage, legal or regulatory proceedings, or other adverse consequences which could harm our business.

 

In the event of employee or service provider
misconduct or error, our business may be adversely impacted.

 

Employee or service provider misconduct or error
could subject us to legal liability, financial losses, and regulatory sanctions and could seriously harm our reputation and negatively
affect our business. Such misconduct could include engaging in improper or unauthorized transactions or activities, misappropriation
of funds, identity theft, misappropriation of information, failing to supervise other employees or service providers, and improperly
using confidential information. Employee or service provider errors, including mistakes in executing, recording, or processing transactions
for customers, could expose us to the risk of material losses even if the errors are detected. Although we have implemented processes
and procedures and provide trainings to our employees and service providers to reduce the likelihood of misconduct and error, these efforts
may not be successful. Moreover, the risk of employee or service provider error or misconduct may be even greater for novel products
and services. It is not always possible to deter misconduct, and the precautions we take to prevent and detect such activities may not
be effective in all cases. If we were found to have not met our regulatory oversight, compliance and other obligations, we could be subject
to regulatory sanctions, financial penalties, and restrictions on our activities for failure to properly identify, monitor and
respond to potentially problematic activity and seriously damage our reputation. Our employees, contractors, and agents could also commit
errors that subject us to financial claims for negligence, as well as regulatory actions, or result in financial liability. Further,
allegations by regulatory or criminal authorities of improper trading activities could affect our brand and reputation.

 

Our officers, directors, employees, and
large shareholders may encounter potential conflicts of interests with respect to their positions or interests in certain crypto assets,
projects, entities, and other initiatives, which could adversely affect our business and reputation.

 

We frequently engage in a wide variety of transactions
and maintain relationships with a significant number of other firms in the broad economy surrounding Bitcoin, blockchain and crypto assets.
These transactions and relationships could create potential conflicts of interests in management decisions that we make. For instance,
certain of our officers, directors, and employees are active investors in crypto projects themselves, and may make investment decisions
that favor projects that they have personally invested in. Many of our large shareholders also make investments in these crypto projects.

 

Similarly, certain of our directors, officers,
employees, and large shareholders may hold crypto assets or have other beneficial ownership of sponsors of such crypto assets, tokens,
or stable coins that we are considering supporting with our Bitcoin ATM fleet and may be more supportive of such listing notwithstanding
legal, regulatory, and other issues associated with such crypto assets. If we fail to manage these conflicts of interests, our business
may be harmed and the brand, reputation and credibility of our company may be adversely affected.

 

 

 

 

 

Risk Factors Related to Ownership of
Our Common Stock

 

Our founders, officers, single major shareholder,
and directors control, and will continue to control, our Company for the foreseeable future, including the outcome of matters requiring
shareholder approval.

 

Our founders, officers, single major shareholder,
and directors collectively beneficially own approximately 69% of our outstanding shares of common stock. As a result, such individuals
will, for the foreseeable future, have the ability, acting together, to control the election of our directors and the outcome of corporate
actions requiring shareholder approval, such as: (i) a merger or a sale of our company, (ii) a sale of all or substantially all of our
assets, and (iii) amendments to our articles of incorporation and bylaws. This concentration of voting power and control could have a
significant effect in delaying, deferring, or preventing an action that might otherwise be beneficial to our other shareholders and be
disadvantageous to our shareholders with interests different from those entities and individuals. Certain of these individuals also have
significant control over our business, policies and affairs as officers or directors of our Company. In addition, Messrs. Gravengaard
and Komaransky, have ability to control who is elected to our board of directors pursuant to the voting agreement, as amended, they entered
into. See “
Management and Certain Security Holders” for further discussion of the board of directors’
structure and principal shareholders’ agreements. Therefore, you should not invest in reliance on your ability to have any control
over our Company.

 

Our securities may be treated as “Penny
Stocks” that may make them less desirable or accessible by investors or potential investors.

 

Rule 15g-9 under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”) establishes the definition of a “penny stock,” for the purposes relevant
to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share,
subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require: (a) that a broker or dealer
must approve a person’s account for transactions in penny stocks; and (b) the broker or dealer must receive from
the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

 

In order to approve a person’s account
for transactions in penny stocks, the broker or dealer must: (a) obtain financial information and investment experience objectives of
the person and (b) make a reasonable determination that the transactions in penny stocks are suitable for that person and the person
has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

 

The broker or dealer must also deliver, prior
to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight
form: (a) sets forth the basis on which the broker or dealer made the suitability determination; and (b) confirms that the broker or
dealer received a signed, written agreement from the investor prior to the transaction. Generally, brokers may be less willing to execute
transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of
our common stock and cause a decline in the market value of our common stock.

 

Disclosure also has to be made about the risks
of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker or
dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor
in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the
penny stock held in the account and information on the limited market in penny stocks. Management believes that the penny stock rules
could discourage investor interest in and limit the marketability of our Shares.

 

Changes in accounting principles and guidance,
or their interpretation, could result in unfavorable accounting charges or effects, including changes to our previously filed financial
statements, which could cause our stock price to decline.

 

We prepare our consolidated financial statements
in accordance with U.S. generally accepted accounting principles (“GAAP”). These principles are subject to interpretation
by the SEC and various bodies formed to interpret and create appropriate accounting principles and guidance. A change in these principles
or guidance, or in their interpretations, may have a significant effect on our reported results and retroactively affect previously reported
results.

 

 

 

 

 

Our Shares are subject to FINRA sales practice
requirements that may make them less desirable or accessible by investors or potential investors.

 

The U.S. Financial Industry Regulatory Authority
(“FINRA”) has adopted rules that require a broker-dealer to have reasonable grounds for believing that an investment is suitable
for a customer before recommending an investment to a customer. Prior to recommending speculative, low priced securities to non-institutional
customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment
objectives, and other information. Pursuant to the interpretation of these rules, FINRA believes that there is a high probability that
speculative, low priced securities will not be suitable for at least some customers. Thus, the FINRA requirements make it more difficult
for broker-dealers to recommend the Common Shares to customers which may limit an investor’s ability to buy and sell the Common Shares,
have an adverse effect on the market for the Common Shares, and thereby negatively impact the price of the Common Shares.

 

Our Shares may be subject to dilution.

 

We may make future acquisitions or enter financings
or other transactions involving the issuance of securities of the Company which may be dilutive to the other shareholders and any new
equity securities issued could have rights, preferences, and privileges superior to those of holders of Common Shares.

 

We have never paid dividends on our common
stock and have no plans to do so in the future.

 

Holders of shares of our common stock are
entitled to receive such dividends as may be declared by our board of directors. To date, we have paid no cash dividends on our shares
of common stock and we do not expect to pay cash dividends on our common stock in the foreseeable future. We intend to retain future
earnings, if any, to provide funds for operations of our business. Therefore, any return investors in our common stock may have, will
be in the form of appreciation, if any, in the market value of their shares of common stock. See “Dividend Policy.”

 

We will indemnify and hold harmless our
officers and directors to the maximum extent permitted by Nevada law.

 

Our bylaws provide that we will indemnify
and hold harmless our officers and directors against claims arising from our activities, to the maximum extent permitted by Nevada law.
In addition, if we are called upon to perform under our indemnification agreements entered into with each one of our directors, then
the portion of our assets expended for such purpose would reduce the amount otherwise available for our business.

 

We may engage in acquisitions, mergers,
strategic alliances, joint ventures, and divestures that could result in results that are different than expected.

 

In the normal course of business, we engage in
discussions relating to acquisitions, equity investments, mergers, strategic alliances, joint ventures, and divestitures. Such transactions
are accompanied by a number of risks, including the use of significant amounts of cash, potentially dilutive issuances of equity securities,
incurrence of debt on potentially unfavorable terms, accruement of impairment expenses related to goodwill and amortization expenses related
to other intangible assets, the possibility that we overpay for an acquisition relative to the economic benefits that we ultimately derive
from such acquisition, and various potential difficulties involved in integrating acquired businesses into our operations.

 

We might require additional capital to
support business growth, and this capital might not be available.

 

We have funded our operations since inception
primarily through debt and equity financings and revenue generated by our services. We cannot be certain when or if our operations will
generate sufficient cash to fully fund our ongoing operations or the growth of our business. We intend to continue to make investments
in our business to respond to business challenges, including deploying more Bitcoin ATMs both in the United States and globally, enhancing
our operating infrastructure, expanding our international operations to include additional regions and countries, and acquiring complementary
businesses and technologies, all of which may require us to secure additional funds. Additional financing may not be available on terms
favorable to us, if at all. If we incur additional debt, the debt holders would have rights senior to holders of our common stock to
make claims on our assets, and the terms of any debt could restrict our operations, including our ability to pay dividends on our common
stock.

 

The trading prices for our common stock may
be highly volatile, which may reduce our ability to access capital on favorable terms or at all. In addition, a slowdown or other sustained
adverse downturn in the general economic or crypto markets could adversely affect our business and the value of our common stock. Because
our decision to raise capital in the future will depend on numerous considerations, including factors beyond our control, we cannot predict
or estimate the amount, timing, or nature of any future issuances of securities. As a result, our shareholders bear the risk of future
issuances of debt or equity securities reducing the value of our common stock and diluting their interests. Our inability to obtain adequate
financing or financing on terms satisfactory to us, when we require it, could significantly limit our ability to continue supporting
our business growth and responding to business challenges.

 

 

 

 

 

Our Common Shares are subject to liquidity
risks.

 

Our Common Stock is quoted on the OTC Pink Market
Tier of the OTC Markets under the symbol “ABIT”. On May 12, 2022, the last reported sale of our Common Stock was $0.2875
per share. As of the date of this prospectus, our Common Stock is quoted on the OTC Pink, and it is not otherwise regularly quoted
on any other over-the-counter market or exchange. We intend for our shares to trade on the OTCQB, an inter-dealer, over-the-counter market
that provides significantly less liquidity than other national or regional exchanges. However, there is no guarantee that our shares
will be listed on the OTCQB, or any other “over- the- counter” marketplace. Moreover, securities traded on the OTCQB are usually
thinly traded, highly volatile, have fewer market makers and are not followed by analysts. The SEC’s order handling rules, which apply
to NASDAQ-listed securities, do not apply to securities quoted on the OTCQB. Quotes and other important information for stocks listed
on the OTCQB are not listed in newspapers and may be incorrectly listed by prominent financial websites. Therefore, prices for securities
traded solely on the OTCQB may be difficult to obtain and holders of our securities may be unable to resell their securities at or near
their original acquisition price, or at any price.

 

We cannot predict at what prices the
common shares of the Company will trade and there can be no assurance that an active trading market will develop or be sustained. There
is a significant liquidity risk associated with an investment in the Company.

 

The shares of our common stock we may issue
in the future and the options we may issue in the future may have an adverse effect on the market price of our common stock and cause
dilution to investors.

 

We may issue shares of common stock and warrants
to purchase common stock pursuant to private offerings and we may issue options to purchase common stock to our executive officers and
employees pursuant to their employment agreements. The sale, or even the possibility of sale, of shares pursuant to a separate offering
or to executive officers and employees could have an adverse effect on the market price of our common stock or on our ability to obtain
future financing.

 

We do not anticipate paying any cash
dividends on our capital stock in the foreseeable future.

 

We have never declared or paid cash dividends
on our capital stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our
business, and we do not anticipate paying any cash dividends on our capital stock in the foreseeable future. In addition, the terms of
any future debt agreements may preclude us from paying dividends.

 

We will incur increased costs as a result of operating as a
public company, and our management will be required to devote substantial time to compliance with our public company responsibilities
and corporate governance practices.

 

As a public company, we will incur significant
legal, accounting, and other expenses that we did not incur as a private company, which we expect to further increase after we are no
longer an “emerging growth company.” The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act,
and other applicable securities rules and regulations impose various requirements on public companies. Our management and other personnel
devote a substantial amount of time to compliance with these requirements. Moreover, these rules and regulations will increase our legal
and financial compliance costs and will make some activities more time-consuming and costly. We cannot predict or estimate the amount
of additional costs we will incur as a public company or the specific timing of such costs.

 

Being a public company results in additional
expenses, diverts management’s attention and could also adversely affect our ability to attract and retain qualified directors.

 

As a public reporting company, we are subject
to the reporting requirements of the Exchange Act. These requirements generate significant accounting, legal and financial compliance
costs and make some activities more difficult, time consuming or costly and may place significant strain on our personnel and resources.
The Exchange Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over
financial reporting. In order to establish the requisite disclosure controls and procedures and internal control over financial reporting,
significant resources and management oversight are required.

 

 

 

 

 

 

As a result, management’s attention
may be diverted from other business concerns, which could have an adverse and even material effect on our business, financial condition
and results of operations. These rules and regulations may also make it more difficult and expensive for us to obtain director and officer
liability insurance. If we are unable to obtain appropriate director and officer insurance, our ability to recruit and retain qualified
officers and directors, especially those directors who may be deemed independent, could be adversely impacted.

 

We are an emerging growth company and a
smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements
available to “emerging growth companies” or “smaller reporting companies,” this could make our securities less
attractive to investors and may make it more difficult to compare our performance with other public companies.

 

We are an “emerging growth company,”
as defined in the Jumpstart Our Business Startups Act of 2012, or JOBS Act, and, for as long as we continue to be an “emerging
growth company,” we intend to take advantage of certain exemptions from various reporting requirements applicable to other public
companies but not to “emerging growth companies,” including, but not limited to, not being required to comply with the auditor
attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in
our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation
and stockholder approval of any golden parachute payments not previously approved. We could be an “emerging growth company”
for up to five years following the effectiveness of this registration statement, or until the earliest of (i) the last day of the first
fiscal year in which our annual gross revenues exceed $1.07 billion, (ii) the date that we become a “large accelerated filer”
as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates
exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we
have issued more than $1.0 billion in non-convertible debt during the preceding three year period.

 

Because we are not subject to compliance
with rules requiring the adoption of certain corporate governance measures, our stockholders have limited protection against interested
director transactions, conflicts of interest and similar matters.

 

The Sarbanes-Oxley Act of 2002, as well as
rule changes proposed and enacted by the SEC, the New York and American Stock Exchanges and the Nasdaq Stock Market, as a result of Sarbanes-Oxley,
require the implementation of various measures relating to corporate governance. These measures are designed to enhance the integrity
of corporate management and the securities markets and apply to securities that are listed on those exchanges or the Nasdaq Stock Market.
Because we are not presently required to comply with many of the corporate governance provisions and because we chose to avoid incurring
the substantial additional costs associated with such compliance any sooner than legally required, we have not yet adopted these measures.

 

Because none of our directors (currently five
persons) are independent directors, we do not currently have an independent audit or a compensation committee. As a result, directors
have the ability, among other things, to determine each other’s level of compensation. Until we comply with such corporate governance
measures, regardless of whether such compliance is required, the absence of such standards of corporate governance may leave our stockholders
without protections against interested director transactions, conflicts of interest, if any, and similar matters and investors may be
reluctant to provide us with funds necessary to expand our operations.

 

We intend to comply with all corporate governance
measures relating to director independence as and when required. However, we may find it very difficult or be unable to attract and retain
qualified officers, directors and members of board committees required to provide for our effective management as a result of Sarbanes-Oxley
Act of 2002. The enactment of the Sarbanes-Oxley Act of 2002 has resulted in a series of rules and regulations by the SEC that increase
responsibilities and liabilities of directors and executive officers. The perceived increased personal risk associated with these recent
changes may make it costlier or deter qualified individuals from accepting these roles.

 

In addition to the above risks, businesses are often subject
to risks not foreseen or fully appreciated by management. In reviewing this Prospectus, potential investors should keep in mind other
risks that could be important.

 

 

 

SPECIAL
NOTE REGARDING Forward-Looking Statements

 

This prospectus contains “forward-looking
statements.” Forward-looking statements reflect the current view about future events. When used in this prospectus, the words “anticipate,”
“believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or
the negative of these terms and similar expressions, as they relate to us or our management, identify forward-looking statements. Such
statements include, but are not limited to, statements contained in this prospectus relating to our business strategy, our future operating
results and liquidity and capital resources outlook. Forward-looking statements are based on our current expectations and assumptions
regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially
from those contemplated by the forward-looking statements. They are neither statements of historical fact nor guarantees of assurance
of future performance. We caution you therefore against relying on any of these forward-looking statements.

 

Important factors that could cause actual
results to differ materially from those in the forward-looking statements include, without limitation, market acceptance of our products;
our ability to protect our intellectual property rights; the impact of any infringement actions or other litigation brought against us;
competition from other providers and products; our ability to develop and commercialize new and improved products and services and successfully
pursue innovation; our ability to complete capital raising transactions; and other factors (including the risks contained in the section
of this prospectus entitled “Risk Factors”) relating to our industry, our operations and results of operations. Actual results
may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Important factors that could cause
such differences include, but are not limited to:

 

· our
future financial performance, including our expectations regarding our net revenue, operating
expenses, and our ability to achieve and maintain future profitability;
· our
business plan and our ability to effectively manage our growth;
· anticipated
trends, growth rates, and challenges in our business, the crypto economy, and in the markets
in which we operate;
· market
acceptance of our products and services;
· beliefs
and objectives for future operations;
· our
ability to further penetrate our existing customer base and maintain and expand our customer
base;
· our
ability to develop new products and services and grow our business in response to changing
technologies, customer demand, and competitive pressures;
· our
expectations concerning relationships with third parties;
· our
ability to maintain, protect, and enhance our intellectual property;
· our
ability to continue to expand internationally;
· the
effects of increased competition in our markets and our ability to compete effectively;
· future
acquisitions of or investments in complementary companies, products, services, or technologies
and our ability to successfully integrate such companies or assets;
· our
ability to stay in compliance with laws and regulations that currently apply or become applicable
to our business both in the United States and internationally;
· economic
and industry trends, projected growth, or trend analysis;
· trends
in revenue, cost of revenue, and gross margin;
· trends
in operating expenses, including technology and development expenses, sales and marketing
expenses, and general and administrative expenses, and expectations regarding these expenses
as a percentage of revenue;
· increased
expenses associated with being a public company; and
· other
statements regarding our future operations, financial condition, and prospects and business
strategies.

 

In some cases, you can identify forward-looking
statements by terminology such as “may,” “will,” “should,” “expects,” “intends,”
“plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,”
“continue” or the negative of these terms or other comparable terminology. These statements are only predictions. You should
not place undue reliance on forward-looking statements, because they involve known and unknown risks, uncertainties, and other factors,
which are, in some cases, beyond our control and which could materially affect results. Actual events or results may vary significantly
from those implied or projected by the forward-looking statements due to these risk factors. No forward-looking statement is a guarantee
of future performance. You should read this prospectus and the documents that we reference in this prospectus and have filed with the
SEC as exhibits to the registration statement of which this prospectus forms a part with the understanding that our actual future results,
performance, and events and circumstances may be materially different from what we expect.

 

Forward-looking statements are made based
on management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation to update forward-looking
statements if these beliefs, estimates and opinions or other circumstances should change, except as may be required by applicable law.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance, or achievements.

 

 

 

Capitalization

 

The following table details the Company’s
capitalization as of December 31, 2021:

 

· On
an actual basis;
· On
a pro forma basis to give effect to the sale of the shares by employees who have outstanding
loans to exercise options and the pro-rata repayment of those loans; and
· On
a pro forma basis as adjusted basis to give effect to the transaction described in the preceding
bullet point as well as the conversion of the Convertible Debenture.

 

In January 2020, the Company allowed its employees
with vested stock options to exercise such options with the use of a non-recourse loan agreement. The Company’s employees exercised
their respective stock options into a total of 157,635,309 shares of common stock at a weighted average exercise price of $0.0060 per
share. The loan amount at exercise of such options was $945,812. The terms of the non-recourse loan agreement include a maturity date
of 48 months from the date of exercise and an interest rate of 1.69%. As of December 31, 2021, the outstanding balance due from employees
was $977,000. The amount receivable from employees is presented in the balance sheet as a deduction from stockholders’ equity. This
is generally consistent with Rule 5-02.30 of Regulation S-X which states that accounts or notes receivable arising from transactions
involving the registrant’s capital stock should be presented as deductions from stockholders’ equity and not as assets. When the shares
held by employees who have outstanding loans are sold, those loans will be paid in a pro-rata manner as described below.

 

A total of [●] shares of common
stock held by employees (approximately 15% of each employees shares) are being registered in this offering. In the event the employees
sell any or all of these shares before repaying the loan, an amount that bears the same proportion to the total loan including accrued
interest thereon, as the registered number of shares bears to the total holding of the employee against which said loan has been given,
will become due and payable to the Company. If all the registered shares are sold and using the outstanding balance due of $977,000
as of December 31, 2021, the loan will be reduced by $147,000.

 

The pro-forma capitalization would then have
both cash and equity going up by the amount being repaid.

 

The purchasers of the Company’s 8% Convertible
Debentures have an option to convert the outstanding principal and accrued interest amount of their respective Convertible Debentures
into shares of common stock of the Company at the lower of $0.012 per share or 20% discount to the next major financing or change in control.
On conversion the purchasers of these convertible debentures will get shares issue of which will be recorded as increase in share capital
of $260,000 and increase in additional paid in capital of $2,865,000. The pro forma basis as adjusted basis column in the table below
gives effect to the conversion of the Convertible Debenture as well as the return of outstanding employee loans as described above. The
Company expects that the Convertible Debentures will convert at $0.012 per share. If the conversion happens at a price lower than $0.012
per share the pro forma basis as adjusted numbers will change accordingly.

 

The pro forma and pro forma as adjusted information
below is illustrative only, and our cash and cash equivalents and total capitalization following the completion of this offering will
be adjusted based on several factors. You should read the following table together with the “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and related
notes thereto appearing elsewhere in this prospectus.

 

 

 

    As of
December 31, 2021
 
(in thousands)   Actual     Pro forma     Pro forma as adjusted (1)  
Cash and cash equivalents                        
Total cash and cash equivalents (2)   $ 1,174     $ 1,321     $ 1,321  
                         
Long-term liabilities                        
Other long-term debt     2,811       2,811       2,811  
Related party convertible debt (1)     3,000       3,000        
Convertible debt (1)     4,765       4,765        
Related party note payable                  
Total long-term liabilities     10,576       10,576       2,811  
                         
Equity:                        
Common stock, $0.001 par value (3)     4,050       4,050       4,360  
Loans to employees for options exercised (4)     (977 )     (830 )     (830 )
Additional paid in capital (5)     5,246       5,246       12,701  
Accumulated deficit     (15,716 )     (15,716 )     (15,716 )
Accumulated other comprehensive loss     (177 )     (177 )     (177 )
Total equity (deficit)     (7,574 )     (7,427 )     338  
Total capitalization   $ 4,176     $ 4,470     $ 4,470  

 

(1) Pro forma as adjusted includes the full conversion of the Convertible
Debentures into 260,416,667 shares of common stock at the assumed conversion price of $0.012 per share for the 8% Convertible Debentures
and 49,850,000 shares of common stock at the assumed conversion price of $0.10 per share for the 6% Convertible Debentures.
See Convertible Debentures in section Description of Capital Stock, page 69.
(2) Pro forma cash and cash equivalents increased by $147,000 from the
repayment of the loan as part of this offering.
(3) Pro forma as adjusted common stock at $0.001 par value increased by $260,000 assuming the full conversion of the 8% Convertible Debentures at conversion price of $0.012 per share and by $50,000 assuming the full conversion of the 6% Convertible Debentures at conversion price of $0.10 per share.
(4) Pro forma as adjusted loans to employees for options exercised decreased
by $147,000 as a result of loan repayment from this offering.
(5) Pro forma as adjusted additional paid in capital increased by $7,455,000
to account for the principal value of the 8% Convertible Debenture of $3,000,000 less $260,000 in common stock value, which was recorded
under common stock and $4,765,000 to account for the principal value of the 6% Convertible Debenture less $50,000 in common stock
value, which was recorded under common stock (see footnote 3).

 

 

 

Management’s
Discussion and Analysis OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis of financial
condition and results of operations should be read in conjunction with our historical financial statements and the notes to those statements
that appear elsewhere in this prospectus. Certain statements in the discussion contain forward-looking statements based upon current
expectations that involve risks and uncertainties, such as plans, objectives, expectations, and intentions. You should read the sections
titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements” for a discussion of important factors
that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained
in the following discussion and analysis.

 

Overview

 

The Company is focused on developing, owning,
and operating a global network of Athena-branded Bitcoin ATM machines, which are free standing kiosks that permit customers to buy or
sell crypto assets in exchange for cash (banknotes) issued by sovereign governments – often referred to as fiat currencies.

 

We place our machines in convenience stores,
shopping centers, and other easily accessible locations. Our network presently includes Athena Bitcoin ATMs in 10 states and 3 countries
in Central and South America. See table below for our ATMs breakdown, as of December 31, 2021.

 

Country Number
of Athena Bitcoin ATMs
(as of December 31, 2021)
Type
of Fiat Currency
Total Two-Way
United
States
186 129 U.S.
Dollar
El
Salvador
3 3 U.S.
Dollar
Argentina 12 12 Argentine
peso
Argentina U.S.
Dollar
Colombia 17 17 Colombian
peso

 

We offer Bitcoin, Ethereum, Litecoin, and
Bitcoin Cash (BCH) for sale at all our ATM machines. We also buy these crypto assets at some of our ATM machines (also known as two-way
ATMs). The cash withdrawal limit from our two-way ATMs is $2,000 per transaction. We replenish our ATMs about twice a week or depending
on usage, using bonded security companies.

 

We also operate an over-the-counter (“OTC”)
desk for private clients and trade customers of the Company. Customers typically interact with the Company on the phone for transaction
sizes in dollar terms greater than $10,000 and on some occasions, for crypto assets not included in our ATMs. Since 2019, we have been
typically buying and selling Bitcoin through our OTC desk, but we have also executed transactions in Ethereum, Litecoin, and in some
cases, altcoins such as Bitcoin SV, Ripple, Siacoin, Tether, and Tron. As of the date of this prospectus, we do not transact in any crypto
assets except Bitcoin, Ethereum, Tether, Litecoin, and BCH. We will update this prospectus if we decide to transact in other crypto assets.
Such a change would only happen if there were significant customer demand for a specific crypto asset and that crypto asset was available
to us through multiple trading partners, digital asset exchange and digital asset brokers.

 

Additionally, we operate ATMs and point-of-sale
(“POS”) terminals on behalf of certain customers, typically under their brand, which we refer to as “white label service”.
This white label service is comprised of maintaining ATMs and POS terminals to facilitate the exchange of crypto assets for cash, and
vice-versa, by our customers with their counterparties. We do not control the service in this case as we are not responsible for fulfilling
the exchange contract or establishing pricing at these ATMs and POS terminals. Currently, the government of El Salvador is our only white
label service customer. The Company has begun working with the government of El Salvador in late June 2021 to support the implementation
of its Bitcoin Law. In August 2021, we entered into certain agreements for services to be rendered by the Company to the Department of
Treasury (Ministerio De Hacienda) of El Salvador, pursuant to which we have installed and are operating 200 Chivo Bitcoin ATMs in El
Salvador, 10 Chivo Bitcoin ATMs at El Salvador consulates in the U.S., 45 Chivo Bitcoin ATMs in other U.S. locations, and importing and
delivering 950 Chivo point-of-sale (“POS”) terminals for local businesses in El Salvador to transact with Bitcoin. As
of December 31, 2021, we were operating 200 white label ATMs in El Salvador for the Department of Treasury (Ministerio de Hacienda) of
El Salvador. We were not operating any POS terminals on behalf of any clients as of December 31, 2021. The Government of El Salvador
controls the private keys in digital asset ATM transactions.

 

From time to time, we sell equipment such as POS
terminals as well as software and corresponding intellectual property (“IP”) to customers, which we consider to be ancillary
to our primary business. This activity is sporadic.

 

 

 

 

Revenue Recognition for the Sale of IP
to Government of El Salvador

 

The Company has satisfied its obligations
with the Government of El Salvador, has sent invoices and has received payment for these invoices. We will recognize the revenue for
these transactions upon finalization of license rights related to the XPay acquisition. The transaction has been recorded as Advances
for Revenue Contract pending the closing of the XPay acquisition. In the event the XPay acquisition does not close as expected, we have
agreed to negotiate with the XPay team to effect and finalize the license formalities and will recognize the associated revenue in compliance
with ASC 606 Revenue from Contracts with Customers which provides accounting guidance for the licensing of Intellectual Property (“IP”).

 

Our analysis follows:

 

To properly account for IP licenses under
ASC 606, the Company analyzes each contract to determine:

 

1) whether the transaction represents a sale
or licensing of IP

 

Conclusion: The Company licenses its
IP

 

2) whether the IP is a distinct performance
obligation:

 

Licenses of IP are often transferred with
other goods or services in a contract. Therefore, entities must determine if a license of IP is a distinct (separate) performance obligation
in accordance with ASC 606-10-25-18 through 25-22. This means that the IP must be (1) capable of being distinct and (2) distinct within
the context of the contract.

 

The guidance provides two examples of when
a license is not distinct from the other goods or services in a contract:

 

a. When the license forms a component key
to the functionality of a tangible good (e.g. machinery with integral embedded software).

 

b. When the license is required for a customer
to benefit from a related service (e.g. web hosting arrangements for software).

 

If a license is deemed not to be distinct
during this analysis, the license is combined with the other goods or services and the combined performance obligation.

Conversely, if the license is distinct, then
it is a separate performance obligation. If the license is regarded as a separate performance obligation and the Company will then determine
the nature of the license to assess the timing of revenue recognition.

 

Conclusion: We consider goods or services
to be distinct if the customer receives benefits from the goods or services on their own or with other resources that are readily available
and if our promise to transfer the goods or services to the customer can be separately identified and distinguished from other promises
in the contract (ASC 606-10-25-19).

 

3) The nature of the license—functional
or symbolic

 

ASC 606-10-55-59 notes two categories of licenses:
functional and symbolic.

 

To determine whether the entity’s promise
to provide a right to access its intellectual property or a right to use its intellectual property, the entity should consider the nature
of the intellectual property to which the customer will have rights. Intellectual property is either:

 

a. Functional intellectual property. Intellectual
property that has significant standalone functionality (for example, the ability to process a transaction, perform a function or task,
or be played or aired). Functional intellectual property derives a substantial portion of its utility (that is, its ability to provide
benefit or value) from its significant standalone functionality.

 

b. Symbolic intellectual property. Intellectual
property that is not functional intellectual property (that is, intellectual property that does not have significant standalone functionality).
Because symbolic intellectual property does not have significant standalone functionality, substantially all of the utility of symbolic
intellectual property is derived from its association with the entity’s past or ongoing activities, including its ordinary business
activities.

 

Conclusion: The Company determines
that its IP provides the Customer with the right to access.

 

 

 

 

 

 

4) the timing of recognition based on the
nature of the license

 

The determination of the IP’s nature
as being either a right to use or a right to access affects the timing of revenue recognition. Specifically, revenue from licenses of
IP deemed to provide a right to use IP will be recognized at a point in time when control is transferred in accordance with ASC 606-10-25-30.
On the other hand, revenue from licenses of IP deemed to provide a right to access IP will be recognized over the license period (or
its remaining economic life, if shorter). Such licenses will follow the revenue recognition over time guidance found in ASC 606-10-25-31
through 37.

 

Conclusion: The Company determines
that it will recognize its IP revenue at a point in time, as we determine will be the completion of the XPay transaction.

 

As of December 31, 2021, the Company has received
an advance for sale of IP Software, pursuant to our contract with El Salvador, which, for accounting purposes, at the time of receipt
is recorded as advances from revenue contract until revenue can be recognized when the XPay acquisition has been finalized. ASC 606 states
that revenue should be recognized at the point in time when the specific performance obligations in the contract are performed. The Company’s
acquisition of XPay, which has not closed as of the date of this prospectus, is the final step for the Company to acquire all of the
intellectual property necessary to transfer to the government of El Salvador.

 

As of December 31, 2021, the Company recorded
Advances for revenue contract as follows: On August 26, 2021, the Company presented to the government of El Salvador an invoice for Service
Addendum 1 (the Chivo Ecosystem software) in the amount of $2,000,000 plus 13% Value Added Tax (VAT) of $260,000. Payment on this invoice
was received on August 31, 2021, for the net amount of $1,600,000 after deducting 20% Income tax withheld at source of $400,000 and VAT.
The transaction was recorded in the Company’s books as Advances for revenue contract for $2,000,000, VAT Payable of $260,000 which
was subsequently paid and reduced to zero and prepaid income tax for the 20% retention of $400,000 for which we have provided full allowance.

 

On October 21, 2021, the Company presented
to the government of El Salvador an invoice related to the Chivo Ecosystem for services provided for the period ended September 30, 2021,
in the amount of $1,500,000 plus 13% Value Added Tax (VAT) of $195,000. Payment for this invoice was received on October 26, 2021, for
the net amount of $1,200,000 after deducting 20% Income tax withheld at source of $300,000 and VAT. The transaction was recorded in the
Company’s books as Advances for revenue contract for $1,500,000, VAT Payable of $195,000 which was subsequently paid and reduced
to zero and prepaid income tax for the 20% retention of $300,000 for which we have provided full allowance.

 

Through the year ended December 31, 2021, the
Company booked a total of $3,500,000 as Advances for revenue contract and $757,000 for capitalized software development within other non-current
assets for the costs related to the Chivo Ecosystem in the consolidated balance sheets. In addition, $700,000 in taxes was recorded as
part of income tax expense in the Consolidated Statement of Operations and Comprehensive Income.

 

Revenue Recognition for the Installation
of Chivo Branded Bitcoin ATMs in El Salvador

 

With respect to the installation of the Chivo
Branded Bitcoin ATMs in El Salvador and specifically the installation fee collected from the government of El Salvador, we analyze the
payment of the installation fee using the ASC 606 framework as follows:

 

1. Contract with Customer:

The contract with the government
of El Salvador for the installation and operation of the Chivo Branded Bitcoin ATMs in El Salvador is filed as Exhibit 10.25.

 

2. Separate Performance Obligations in
the Contract:
a) Government of El Salvador must pay
an installation charge, a monthly service fee, and a per-transaction fee (if applicable).
b) Company must install White-Labeled
ATMs at the locations determined by the Service Client.
c) Company must operate the White-Labeled
ATMs including keeping them stocked, online, and ready to function

 

3. Determine Transaction Price:
1) For the installation of White-Labeled ATMs:
The contract specifies a one-time installation fee.
2) For the monthly operation of White-Labeled
ATMs: The contract specifies a monthly operation fee.

 

4. Allocate the Transaction Price to
Performance Obligations:

The
Company has two performance obligation, which is to install ATMs at the various locations and the second item refers to the monthly maintenance
fees the Company has allocated the selling price because it is made up of a series of distinct goods or services and includes variable
consideration.

 

 

 

 

 

 

5. Recognition of Revenue When Company
Satisfies Performance Obligation:

 

The Company as noted above has two
revenue sources related to the Chivo ATMs, an installation fee of $339,000 and an additional fee of $1,412.50 per month for the ongoing
maintenance and servicing of the equipment. Based off the guidance’s criteria, the revenue related to the installation is treated
as being recognized at a point in time due to the fact that the customer (Treasury Department) may terminate the contracts at any time
and for any reason by providing Athena a 30-day written notice, the Company in effect has a 30-day contract. Each individual ATM is distinct
and are separately identifiable. Therefore, the single payment for installation of 200 ATMs in El Salvador national territory ($339,000)
is considered a distinct performance obligation. 

 

The monthly maintenance and service fee is $1,412.50
per ATM. Based on the guidance’s criteria, the customer simultaneously receives and consumes the benefits provided by the Company
and as a result the monthly fee is considered to be recognized over the contracts time. The Company expects costs to fulfill the ATM services
to remain level at $705,000 per quarter.

 

Further analysis and recognition of revenues
for the year ended December 31, 2021:

 

For installation, the Company received a one-time
payment of $300,000 for the installation of 200 ATMs in El Salvador national territory. Although ASC 606-10-25-4 states that “A
contract does not exist if the parties have unilateral enforceable rights to terminate”, in the Basis of Conclusion 50 (“BC
50”) in ASU 2014-09, FASB decided that this applies only if each party to the agreement has the unilateral enforceable right to
terminate the contract without penalty. Those contracts would not affect an entity’s financial position or performance until either
party performs.

 

In accordance with ASC 606-10-25-1 and 2, the
first step in assessing revenue recognition is to identify the contract with the customer. As described below, the Company’s contract
with Department of Treasury of El Salvador is cancelable by them with 30 days’ notice. The Company recognized a one-time fee
upfront since the installation of ATMs was considered a distinct performance obligation and the Company has a 30-day contract not subject
to cancellation, which rolls over into another 30-day contract if Department of Treasury of El Salvador does not cancel, as discussed
below.

 

However, if only the customer (e.g., Department
of Treasury of El Salvador) could terminate the agreement(s) without penalty, the entity is obliged to stand ready to perform at the discretion
of the customer. Hence, there could be an effect on an entity’s financial position and performance if only one party could terminate
a wholly unperformed contract without penalty.

 

As long as the Department of Treasury of El
Salvador does not give notice to terminate the ATM services, Athena has an enforceable obligation to provide services and an enforceable
right to receive payment for those services for the next 30 days until the contractual termination date of the Master Services Agreement
and the Service Addendum.

 

Each individual ATM is distinct and aside from
integration to the Chivo Ecosystem digital platform, it is not dependent on other services. The ATMs are delivered to the customer at
different points in time and are separately identifiable. Therefore, the single payment for installation of 200 ATMs of $300,000 in El
Salvador’s national territory is considered a distinct performance obligation.

 

For the year ended December 31, 2021 revenue on
ATM installation and related services was $300,000 and direct costs related to the installation were $334,000 as presented in our Consolidated
Statement of Operations and Comprehensive Income.

 

Revenue Recognition for the Sale of Digital
Assets

 

Through our Athena ATM machines, we buy and
sell various Digital Assets as described above at an offer price that changes according to the prevailing price. We control all aspects
of the transaction done at our Athena ATMs and we record those transaction on a gross basis as we act as a principal in such sales. Through
our White-Labeled ATMs, which we operate on behalf of service clients, we facilitate the buying and selling of various Digital Assets
at prices that change according to the prevailing price, but that are set by the service clients. We do not control all aspects of the
transaction done at White-Labeled ATMs and record those transactions on a net basis as we act as an agent. The PWC ASC 606 Guide aids
us in characterizing these transactions as either principal or agent based on the party having pricing discretion. As we do not control
pricing, own the Digital Asset being sold, or control all aspects of the transaction for White-Label ATM services, we have determined
that we are an agent.

   

 

 

 

 

Although these steps are done sequentially,
they are completed from start to finish in a matter of minutes or hours and are treated as point in time transactions with a single performance
obligation by the Company. Further the Digital Assets the Company sells are fungible and would have the same value to any other customer
and client. During the performance of these Transactional Steps, the Company does not create an asset with an alternative use or an asset
that is unique to the customer. Finally, these transactions, where the Company acts as a principal in the sale of a Digital Asset, do
not create an Accounts Receivable or a prepayment. All transactions are settled same day. The specific transactional steps and activities
with respect to such sales of Digital Assets (i.e., indefinite-lived intangible assets) are as follows:

 

Types of Digital Asset Sales Transactional
Steps and Activities
Sale
of Digital Assets via ATMs
606 Evaluation

1. Contract with Customer:

Simple cash-for-crypto purchase contract
with ATM customer governed by ATM Terms of Service filed as Exhibit 10.34 to the registration statement which this prospectus is a part.

 

2. Separate Performance Obligations in
the Contract:

Customer must insert into the
ATM authentic sovereign currency as payment for the Digital Asset.

Company must deliver Digital
Asset to the address specified by the Customer immediately after the Customer finishes her insertion of cash.

 

3. Determine Transaction Price:

 

The price that the Company will sell a
Digital Asset is displayed on the screen of the Bitcoin ATM. That price is set by the Company by taking the then prevalent price
of the Digital Asset and applying a markup.

 

4. Allocate the Transaction Price to Performance
Obligations:

 

100% of the Transaction Price is recognized
at the Company’s single Performance Obligation. There are no refunds. All sales are final. There are no ongoing performance
obligations.

 

5. Recognition of Revenue When Company
Satisfies Performance Obligation:

 

Revenue, gross transaction amount, is
recognized when the Company has completed its single Performance Obligation.

Step 1.

Digital Assets, indefinite-lived intangible
assets, are owned and controlled by the Company using digital asset wallets and similar technology operated by the Company, for the
purpose of selling to customers. They have been previously acquired by purchasing such Digital Assets on digital asset exchanges
or from OTC dealers.

 

The customer initiates a transaction by
inserting paper currency into the ATM after complying with KYC/AML and customer identification procedures and pressing the “Buy
BTC” button.

 

The price that the Company will sell a
Digital Asset is displayed on the screen of the Bitcoin ATM. That price is set by the Company by taking the then prevalent price
of the Digital Asset and applying a markup.

 

During this Step, the Digital Assets are
owned and controlled by the Company.

  Step 2.

Once the funds have been inserted into
the ATM and verified for authenticity and the customer has pressed the “Done” button on the ATM, a blockchain transaction
is created that will transfer the ownership and control of the Digital Asset to the blockchain address that the customer has previously
given to the Company via the ATM. The blockchain transaction is then broadcast to the Network, transferring the ownership and control.
The Company does not custody Digital Assets on behalf of customers. This process typically takes seconds and at no time ever takes
more than 20-minutes and would only depend on the batching of several transactions into a single broadcast of a blockchain transaction.

 

The purpose of a Blockchain is to establish
the ownership and control of Digital Assets and represent a ledger of the changes in control and ownership of Digital Assets. The
transfer of ownership and control over Digital Assets is done using the protocol of the Blockchain Network and happens at the precise
moment in time when a blockchain transaction transferring that ownership and control is broadcast on the peer-to-peer network between
nodes. Our Bitcoin ATMs sell Bitcoin that is transferred using on-chain transactions which are broadcast on the Bitcoin Network,
clearly establishing a time before the transaction is broadcast as the time when the Company owned and controlled the Bitcoin and
a time after which when the customer owned and controlled the Bitcoin.

 

Upon completion of this Step, and specifically
at the time the blockchain transaction is broadcast the ownership and control of the Digital Asset is held by the customer using
the ATM.

 

 

 

 

 

 

     
  Custody The
Company is not a custodian of Digital Assets or fiat monies for ATM customers. The digital wallet used and selected by the ATM customer,
according only to her own preferences, is the custodian of the Digital Assets once the ownership and control is transferred in Step
2. There are many digital wallets that can be used to secure a Digital Asset like Bitcoin, the Company’s ATMs work with all
that accept on-chain Bitcoin transactions according to the protocol of the Bitcoin Network.
  Third Party Reliance The
Company relies only on its own holdings of Digital Assets that it controls to fulfill the contract with the customer. The Company
does not contract or engage any other third party to deliver the Digital Asset to the customer.
  Not a Broker The
Company does not actively acquire Digital Assets from other third parties or take control of the Digital Assets from third parties
during the transaction steps described above. If the Company did not have sufficient Digital Assets to complete Step 2, then the
ATM would not allow the initiation of a transaction.
  Use of Proceeds At
a subsequent time, between hours and days, the Company will use some or all of the funds received from the customer to purchase additional
Digital Assets from OTC dealers or on digital asset exchanges or from ATM customers or from OTC customers.
  Accounting

We consider a counterparty in Digital
Asset sales to be our customer. When we sell a Digital Asset that was accounted for as an indefinite-lived intangible asset, we account
for the sale under ASC 606 and present the sale as revenue when control of the digital assets sold has transferred.

 

The Company would record the journal entries
in its books and records for this transaction as a debit to Cash for the amount received and credit to ATM Revenue. Cost of revenue
is recorded as a debit to Cost of revenue for the carrying amount of the digital assets sold and credit to Crypto assets held.

Sale of
Digital Assets via Phone
606 Evaluation

1. Contract with Customer:

 

Simple cash-for-crypto purchase contract
with OTC client governed by OTC Terms of Service filed as Exhibit 10.35 to the registration statement which this prospectus is
a part.

 

2. Separate Performance Obligations in
the Contract:

Client must wire to the Company
authentic sovereign currency payment in the form of same-day available funds for the purchase of the Digital Asset.

Company must deliver Digital
Asset to the address specified by the Customer immediately after the wire is properly received by the Company.

 

3. Determine Transaction Price:

 

The price that the Company will sell a
Digital Asset is communicated electronically to the client via email. That price is set by the Company by taking the then prevalent
price of the Digital Asset and applying a markup.

 

4. Allocate the Transaction Price to Performance
Obligations:

 

100% of the Transaction Price is recognized
at the Company’s single Performance Obligation. There are no refunds. All sales are final. There are no ongoing performance
obligations.

 

5. Recognition of Revenue When Company
Satisfies Performance Obligation:

 

Revenue, gross transaction amount, is
recognized when the Company has completed its single Performance Obligation.

  Step 1.

Digital Assets, indefinite-lived intangible
assets, are owned and controlled by the Company using digital asset wallets and similar technology operated by the Company, for the
purpose of selling to customers. They have been acquired by purchasing such Digital Assets on digital asset exchanges or from OTC
dealers.

 

During this Step, the Digital Assets are
owned and controlled by the Company.

 

The client initiates a purchase of Digital
Assets, after discussing a transaction with our client services staff, by transferring funds from her bank accounts to those of the
Company.

 

 

 

 

 

     
  Step 2.

Once the sovereign funds have been received
into the bank accounts of the Company our client services team completes the transaction with the client. This Step is completed
the same day as the funds are received and typically within 30 to 60 minutes of receiving a notification from the Company’s
bank.

 

First, they validate the funds represent
a good and proper wire of same-day available funds from an account owned by the client. Second the price at which the client will
purchase the Digital Asset is determined by observing the then prevalent Digital Asset price and applying the appropriate markup.
Finally, a blockchain transaction is created that will transfer the ownership and control of the Digital Asset to the blockchain
address that the customer has previously given to the Company. The blockchain transaction is then broadcast to the Network, transferring
the ownership and control.

 

If it is determined that the funds received
do not originate from an account owned by the client, they are returned to sender. The Company does not custody fiat funds on behalf
of any third parties. The Company does not allow purchases of Digital Assets by agents of third parties. The Company only deals with
other principals who have control of their own fiat funds and take direct ownership and control of Digital Assets.

 

Our only Performance Obligation, with
respect to this transaction, is to deliver the Digital Asset into the ownership and control of the customer. The Company does not
custody fiat funds or Digital Assets on behalf of clients.

 

Upon completion of this Step, and specifically
at the time the blockchain transaction is broadcast, the ownership and control of the Digital Asset is held by the client.

  Custody The Company
is not a custodian of Digital Assets or fiat funds for OTC customers.
  Third Party Reliance The Company
relies only on its own holdings of Digital Assets that it controls to fulfill the contract with the customer. The Company does not
contract or engage any other third party to deliver the Digital Asset to the customer.
  Not a Broker

The Company may or may not acquire Digital
Assets from other third parties or take control of the Digital Assets from third parties during the transaction steps described above.
The time between Steps 1 and 2 can last hours and many transactions, of varying types, can be in the process of completion simultaneously.
These activities are incidental to this transaction and not a part of the flow of procedural steps.

 

If the Company did not have the Digital
Assets or have the expectation of immediately purchasing, from readily available sources, and taking control over such Digital Assets,
then the Company would not initiate the transaction in Step 1. The Company has multiple sources for purchasing Digital Assets and
does not contract or engage such a source to specifically fulfill the performance obligation of this contract.

 

The Company is not a broker, we trade
as a principal in these transactions.

  Use of Proceeds At
a subsequent time, between hours and days, the Company will use some or all of the funds received from the customer to purchase additional
Digital Assets from OTC dealers or on digital asset exchanges or from ATM customers or from OTC customers.

 

 

 

 

 

     
  Accounting

In some circumstances and depending on
the Company’s arrangement with the counterparty, the order of Step 1 and Step 2 could be reversed. This would not impact the
accounting treatment for this transaction.

 

We consider a counterparty in digital
asset sales to be our customer. When we sell a digital asset that was accounted for as an indefinite-lived intangible asset, we account
for the sale under ASC 606 and present the sale as revenue when control of the digital assets sold has transferred.

 

The Company would record the journal entries
in its books and records for this transaction as a debit to Cash for the amount received and credit to ATM Revenue. Cost of revenue
is recorded as a debit to Cost of revenue for the carrying amount of the digital assets sold and credit to Crypto assets held.

Sale of Crypto Asset via White Labeled ATMs

 

How we deliver the services as agent.

 

606 Evaluation

1. Contract with Customer:

 

The Company has contracted with a service client to provide White-Labeled
ATMs. For the government of El Salvador, the terms of this service activity are filed as Exhibits 10.24, 10.25, 10.26, and 10.27 to the
registration statement which this prospectus is a part. As part of that contract, the Company must facilitate the sale of Bitcoin to a
user of the White-Labeled ATM in exchange for cash.

 

2. Separate Performance Obligations in
the Contract:

 

a)      
Service Client must pay an installation charge, a monthly service fee, and a per-transaction fee (if applicable).

b)      
Service Client must make available to the Company a balance of Digital Assets to be sold at the White-Labeled ATMs and facilitate
the transfer of those Digital Assets to the ATM User.

c)      
ATM User must insert into the ATM authentic sovereign currency as payment for the Digital Asset.

d)      
Company must install White-Labeled ATMs at the locations determined by the Service Client.

e)      
Company must operate the White-Labeled ATMs including keeping them stocked, online, and ready to function

f)       
Company must deliver a Digital Asset to the address specified by the ATM user immediately after the funds are inserted.

 

3. Determine Transaction Price:

 

For the sale of Digital Assets at an ATM:
The price that the Service Client will sell a Digital Asset displayed on the screen of a White-Label ATM. That price is computed
by the Company by taking the then prevalent price of the Digital Asset and applying a markup (if applicable). If the contract allows
the Company to collect a per-transaction fee, then that fee would be the price at which the Company would deliver the service of
providing each transaction.

 

a)      
For the installation of White-Labeled ATMs: The contract specifies a one-time installation fee.

b)      
For the monthly operation of White-Labeled ATMs: The contract specifies a monthly operation fee.

 

4. Allocate the Transaction Price to Performance
Obligations:

 

The Company has relied upon the guidance
of ASC 606-10-32-32, which states that “a contractually stated price or a list price for a good or service may be (but shall
not be presumed to be) the standalone selling price of that good or service.” Hence, the Company will rely upon the stated
amounts in the Contract to allocate the transaction price to the various performance obligations. 

 

5. Recognition of Revenue When Company
Satisfies Performance Obligation:

 

The Company as noted above has two revenue
sources related to the Athena ATMs, in which the Company charges a fee per cryptocurrency equal to the prevailing price at U.S. crypto-based
exchanges plus a markup that typically varies between 5% and 20%.  

 

Based off the guidance’s criteria,
the customer simultaneously receives and consumes the benefits provided by the Company and as a result the fees are considered to
be recognized over time. 

 

Since the fee per cryptocurrency plus
the markup is a result of individual ATM transactions, the Company has determined that the customer obtains control of the entity’s
output as it performs and, thus, the performance obligation is satisfied over time. The Company has concluded that it will recognize
revenue over time. 

 

 

 

 

 

 

     
  Step 1.

Digital Assets, indefinite-lived intangible
assets, are owned and controlled by the services client, using digital asset wallets and similar technology operated by or on behalf
of the services client, for the purpose of selling to users of the services client’s branded Bitcoin ATMs. They have been previously
acquired, for the services client, by purchasing such Digital Assets from other users of the services client branded Bitcoin ATMs
or other legal method for purchasing such Digital Assets in the local country.

 

The price that the ATM user will pay for
a Digital Asset is displayed on the screen of the Bitcoin ATM. That price is computed by ATM software by taking the then prevalent
price of the Digital Asset and applying a markup or no markup as determined by, and only by, the service client. There are many indexes
and price sources for Digital Assets. The service client selects the source for prices of Digital Assets.

 

a)      
During this Step, the Digital Assets are owned and controlled by the services client.

 

b)      
The Digital Assets are not owned and controlled by the Company. The Company does not control the private keys of the services
client.

 

The user of a White-Labeled ATM inserts
paper currency into a service client branded ATM after complying with the service client’s KYC/AML and customer information
procedures.

  Step 2.

Once the funds have been inserted by the
user into the service client branded ATM, and verified for authenticity by the Company, and the user has pressed the “Done”
button on the service client branded ATM, a transaction is created that will transfer the ownership of the Digital Asset to the user.
This could happen by broadcasting a transaction on a Blockchain network, or it could happen within the service client’s digital
wallet system in the case of operating a white-label ATM for a custodial wallet solution that does not broadcast every transaction
or transfer onto a blockchain network.

 

Upon completion of this Step and for all
future Steps for this sale, the ownership of the Digital Asset is held by the user of the White-Labeled ATM. The control of the Digital
Asset might be held by the same user if she used her own self-custodial wallet or by the service client if she used their branded
custodial wallet. In all cases, the Company is not the custodian, controller, or owner of the Digital Asset.

  Custody The
Company is not a custodian of Digital Assets for either users of the service client branded Bitcoin ATM or the service client or
for any third party. The service client, or another service provider to the client, but not the Company, was the custodian of the
Digital Asset prior to the sale of the Digital Asset to the end user.
  Third Party Reliance

The Company relies on its own software,
services, and procedures in addition to the software and services provided by these additional third parties:

·        
The service client is engaged to deliver the Digital Asset in this transaction in Step 2. In the case of the contract with
the government of El Salvador, this would be the services offered by Chivo S.A. de C.V.

  Not a Broker During
the transactional steps and activities described above, the Company does not actively acquire Digital Assets on behalf of the services
client from any third party. If the services client does not have sufficient Digital Assets under their ownership and in their control
to complete Step 2, then the Company and specifically the White-Labeled ATM would not initiate the sale transaction in Step 1.
  Use of Proceeds

The proceeds of the sale of Digital Assets
at a White-Label ATM are the property of the services client. As part of the operating agreement, the Company is responsible for
the collection of these funds from the ATMs.

 

Further, the Company has the obligation
to purchase Digital Assets, from time to time, at its discretion to replenish the Digital Asset used in this transaction and other
transactions. The Company assumes some limited amount of price risk between the price set by the services client in Step 1, and the
price at which the Company is able to purchase replacement amounts of Digital Assets. See Risk Factors in this prospectus for further
discussion of the magnitude of this risk.

  Accounting

The Performance Obligation for the Company
is to provide White-Labeled ATMs having the branding of the service client and to facilitate the use of those ATMs by the service
client’s users. The Company, which has acted as an agent for this transaction, records revenue on a service fee basis; recording
a combination, as applicable, of per-transaction fees and/or monthly service charges.

 

The Company would record the journal entries
in its books and records related to this transaction as a debit to Accounts receivable for the amount of fees and monthly charges
due for that period and credit to Revenue on service on contracts.

 

 

 

When we purchase crypto assets from a retail customer,
we pay less than the prevailing price (referred to as markdown) and when we sell to retail customers, we sell more than the prevailing
price (referred to as markup). There are many sources of prices for Digital Assets. The Company chooses sources that represent the
broad market consensus for the prices of Digital Assets. Both markup and markdown rates are determined based on a variety of commercial
factors such as current price, price trend, category of host location, among others, and are calculated using a proprietary method.

 

We apply different markups for crypto asset
sales through our Athena ATM machines as compared to sales at our OTC desk (markup for the ATMs is greater than at the OTC desk). These
transactions are done as principal by the Company and this revenue is recognized on a gross basis.

 

We do not invest or have long term holdings of
Bitcoin, Ethereum, Litecoin, or BCH. On average, we sell our holdings of Bitcoin within 3 to 5 days of buying it and within 7 to 10 days
of buying our Ethereum, Litecoin, and BCH holdings. We strive to keep this period short to reduce the effect of changes in crypto asset/U.S.
dollar exchange rates on our business and to minimize our working capital. There are risk involved in holding these amounts of Digital
Assets. In the past, we have held a higher level of Bitcoin as an economic hedge against liabilities for Bitcoin borrowed. As of December
31, 2021, management’s estimate of the effect on fair values of the Digital Assets held as indefinite-lived intangible assets due
to a +/- 20% uniform change in the market prices of all crypto assets, with all other variables held constant, was +/- $168.4 thousand
(December 31, 2020: +/- $268.6 thousand).

 

Our OTC desk sells Bitcoin and other digital
assets, which we account for as indefinite-lived intangible assets. We present digital assets sales revenue and corresponding digital
assets sales cost on a gross basis, consistent with the revenue standard. We act as a principal (vs. agent) in these transactions which
requires gross treatment for revenue and for corresponding costs. If we were considered an agent, this would allow the revenue to be
recorded net of corresponding digital asset sales cost. As a principal, we have control over the digital asset before it is transferred
to the customer. All OTC trades are settled the same trading day, we do not allow OTC clients to keep funds on-account with the Company.
We do not provide custodial services and/or wallets for our OTC customers or third parties or otherwise hold any indefinite-lived intangible
assets for these customers.

 

For our white label services in El Salvador,
which include Chivo branded ATMs, we currently collect, and anticipate collecting from future white label service customers, a recurring
monthly service and maintenance fee for ATMs and a one-time setup fee at the beginning of a contract. We provide the equipment and associated
software functionality for our clients to complete ATM transactions with their customers. We do not have control of the Digital Assets
nor do we control all aspects of the operation of each service. The Company recognizes the operating fee it receives for these services
(and not the gross value of customer transactions) as revenue.

 

For the period ended December 31, 2021, the
Revenues from the Sale of Digital Assets at Athena ATMs was $63,097,000 (December 31, 2020: $55,268,000). The Revenues from OTC Sales
of Digital Assets was $15,874,000 (December 31, 2020: $13,579,000).

 

In our ancillary equipment business, we are paid
on the sale of equipment such as POS terminals. In the case of software sales and corresponding IP, we collect a one-time fee and recurring
monthly maintenance fees. This revenue is recognized on a gross basis.

 

BitQuick

 

BitQuick earns revenue from service fees calculated
as a percentage of the purchase value for facilitating a peer-to-peer exchange transaction between sellers and buyers that utilize this
channel. We do not control the Bitcoin used in these transactions and only facilitate the connection and communication between buyers
and sellers. We act as an agent (vs. principal) in these transactions which requires net treatment for revenue and for corresponding
costs. This revenue is recognized on a net basis and not the gross value of user transactions.

 

Our analysis of these transactions under the
ASC 606 framework is as follows:

 

1. Contract with Customer:

 

The Company has contracted with a
Bitcoin Seller to deliver to a Bitcoin Buyer an amount of Bitcoin. The Terms of Service that govern this contract were available on the
BitQuick website when the service was in operation.

 

 

 

 

 

 

2. Separate Performance Obligations in the Contract:
a) Bitcoin Buyer must make a deposit of cash into the bank account of the Bitcoin Seller.
b) Bitcoin Seller must acknowledge the payment made by Bitcoin Buyer to their bank account and give their
affirmative consent to the Company to deliver the Digital Asset, which is owned and controlled by them in a multi-signature wallet that
they have control over.
c) Company must provide a website that connects buyers with sellers and a communication tool for buyer
and seller to interact. The Company also operated a non-custodial multi-signature wallet to allow the escrow of Bitcoin from the control
and ownership of the Seller to the control and ownership of the Buyer.

 

3. Determine Transaction Price:

Transaction Fees: The Company collected
a fee as a percentage of the gross sale amount paid by the Buyer directly to the Seller. The fee was collected in Bitcoin.

 

4. Allocate the Transaction Price to Performance Obligations:

This contract contains a single performance
obligation. The transaction price is the service fee and is entirely allocated to the performance obligation.

 

5. Recognition of Revenue When Company Satisfies Performance Obligation:

The Company recognized the service
fee revenue, at a point in time, when the performance obligation is satisfied. The performance obligation is satisfied when the customer
obtains control over the Bitcoin purchased

 

Future Accounting Treatment

 

If we were to reconstitute the BitQuick service,
our accounting treatment of assets used in the marketplace might be different than previously presented. On March 31, 2022, the SEC’s
staff in the Division of Corporation Finance and the Office of the Chief Accountant released a Staff Accounting Bulletin (SAB) numbered
121 relating to the accounting for obligations to safeguard crypto assets when an entity holds such crypto assets for platform users.
When determining the accounting treatment for a digital asset that is held for a customer, user, or third-party, the Company will first
determine if the digital assets are owned by or are being safeguarded by the Company, or its agent. If those actions included the securing
of cryptographic key information and/or protecting those crypto assets from loss, then we would determine those assets were being safeguarded.
If the determination was made that Company is responsible for safeguarding the digital assets, then the Company will recognize the digital
asset as its asset and recognize a corresponding liability to return the digital asset to the customer or depositor in its financial statements
according to the guidance of SAB 121.

 

The Company does not, as of the date of this
prospectus, safeguard any digital assets on behalf of users.

 

 

 

 

 

 

 

 

 

Purchase of Digital Assets

 

The Company purchases Digital Assets using
the following processes. In most cases, except as noted, the Company acts as principal (vs. agent) in these transactions and records the
purchase price of a Digital Asset as a Cost of revenue using the gross amount of the transaction. If we were an agent, we would record
only the net expenses as the cost of providing those services. These thumbnail sketches of the transactional steps demonstrate how we
establish ownership and control of the Digital Asset in exchange for our fiat funds. Although these steps are done sequentially, they
are completed from start to finish in a matter of minutes or hours; we treat them as concurrent. The transactions are point in time transactions
with a single performance obligation by the Company. In other words, these are simple concurrent exchanges of the Company’s sovereign
funds for the customer’s digital asset. We engage in the following transactional steps and activities with respect to our purchases
of Digital Assets (i.e., our indefinite-lived intangible assets):

 

Types of Digital Asset Purchases Transactional Steps and Activities

Purchase of Digital Assets via ATMs

 

How we purchase Digital Assets as a principal

 

Terms of Service for this activity are filed as Exhibit 10.34 to the registration statement which this prospectus
is a part.

Step 1.

During this Step, the Customer is the owner
and has control of the Digital Asset.

 

The customer initiates a transaction at an
ATM by completing a KYC/AML and customer information process and selecting the appropriate button to sell a Digital Asset to the Company.

 

The price that the Company will purchase a
Digital Asset is displayed on the screen of the Bitcoin ATM. That price is set by the Company by taking the then prevalent price of the
Digital Asset and applying a markdown.

 

The customer sends the Digital Assets by
using his or her wallet to broadcast a transaction on the Blockchain Network .

 

The Company does not custody Digital Assets
or fiat currency on behalf of customers.

Step 2.

Once the Company , and its software systems,
sees the transaction in the Blockchain and has verified its authenticity, funds, in the form of paper monies, are disbursed from the ATM,
thereby completing the transfer of ownership and control of the paper monies, to the customer.

 

Our only performance obligation is to disburse
paper monies from the ATM after receiving and verifying the Digital Asset. This typically occurs within seconds of the customer pressing
the appropriate buttons on their digital wallet and depends on the number of bills that need to be dispensed.

 

We consider ourselves the owner of the Digital
Asset once the last paper money bill is disbursed from the ATM and the Company has fulfilled its performance obligation. The Company does
not custody Digital Assets or fiat currency on behalf of customers, and in cases where the bill dispenser does not function properly the
Company can: issue refunds in the form of the Digital Assets; or direct the customer to a different ATM to retrieve the proper amount
of fiat currency. This does not materially affect our cost of Digital Assets.

 

The Company’s ATMs only purchase Digital
Assets for fiat currencies in the form of paper monies. The Company’s ATMs do not exchange one Digital Asset for another. The Company’s
ATMs do not purchase Digital Assets in exchange for any forms of fiat currency other than paper monies. The Company’s ATMs do not
purchase Digital Assets for bank deposits or other forms of electronic money transmission.

Custody The Company does not custody Digital Assets or fiat money on behalf of ATM users.
  Third Party Reliance The Company relies on its own fiat currency in the ATM to purchase the Digital Assets. The Company does not contract or engage any other third party to: take custody of the Digital Asset; transfer the Digital Asset into the custody or ownership of the Company; or deliver the physical currency into the possession of the customer.

 

 

 

 

 

 

     
  Not a Broker The Company does not actively dispose of the Digital Assets to other third parties or transfer control of the Digital Assets to third parties during the transaction steps described above. If the Company did not have sufficient physical currency to complete Step 2, then the ATM would not allow the initiation of a transaction.
  Use of Digital Assets At a subsequent time, the Digital Assets, indefinite-lived intangible assets, are then owned and controlled by the Company, subject to impairment, and will be used in subsequent activities such as future sales of Digital Assets to ATM or OTC clients. Digital Assets, which are indefinite-lived intangible assets, are not held as “inventory”.
  Accounting

Digital Assets are indefinite-lived intangible
assets. An indefinite-lived intangible asset is initially carried at the value determined in accordance with ASC 350-30-30-1, ASC 805-50-30-2,
and is not subject to amortization.

 

Digital Assets purchased through this method
are subject to the Company’s impairment policy for impairment of indefinite-lived intangible assets.

 

The Company records the cost of the Digital
Assets acquired as the price paid to the customer, in the form of paper monies dispensed by the ATM. These costs are recorded using the
gross amount, as the Company acted as a principal in the transaction.

 

The performance obligation for this transaction
is to disburse fiat currency. Once the last bill falls out of the ATM, the Company would record the journal entries in its books and records
for this transaction as a debit to purchases for the amount of cash disbursed from the ATMs and credit to Cash.

Purchase of Digital Assets via OTC

 

How we purchase Digital Assets as a principal

 

Terms of Service for this activity are filed as Exhibit 10.35 to the registration statement which this prospectus
is a part.

Step 1.

During this Step, the client is the owner and
has control of the Digital Asset.

 

The client initiates a transaction by contacting
a member of our services team indicating a desire to sell a Digital Asset. This is subsequent to any KYC/AML and customer onboarding processes
have been completed.

 

The customer transfers ownership and control of
Digital Assets by using his or her wallet to broadcast a transaction on the Blockchain Network that transfers ownership to the
Company.

 

The Company does not custody Digital Assets
or fiat currency on behalf of customers.

Step 2.

Once the Company , either through monitoring
software or by work of the client services team, sees the transaction in the Blockchain and verifies the authenticity and
amount of the Digital Asset, the client services team completes the transaction with the client. This Step is completed the same day as
the Digital Assets are received and typically within 60 to 90 minutes of the transaction being broadcast on the Blockchain Network.

 

First, the customer service team validates
the funds represent a good and proper transaction of Digital Assets. Second the price at which the client will sell the Digital
Asset is determined by observing the then prevalent Digital Asset price and applying the appropriate markdown. Finally, a wire is sent
from the Company’s bank account to the client’s bank.

 

The Company does not custody fiat funds on
behalf of any third parties. The Company does not allow sales of Digital Assets by agents of third parties. The Company only deals with
other principals who have control of their own fiat funds and direct ownership and control of Digital Assets.

 

Our only Performance Obligation, with respect
to this transaction, is to deliver the sovereign funds into the bank account of the client.

 

Upon completion of this Step, and specifically
at the time the wire instructions are sent to the Company’s bank, and for all future Steps for this purchase, the ownership and
control of the Digital Asset is held by the Company .

Custody The Company does not custody fiat funds or Digital Assets on behalf of clients.

 

 

 

 

 

  Third Party Reliance The Company relies on its own fiat funds to purchase Digital Assets in this transaction and does not rely on, contract with, or engage any third party to complete this transaction. The Company does not contract or engage any other third party to: take custody of the Digital Asset; or transfer the Digital Asset into the custody or ownership of the Company.
  Not a Broker

The Company may or may not dispose of the Digital
Assets to other third parties or transfer control of the Digital Assets to third parties during the transaction steps described above.
The time between Steps 1 and 2 can be 60 to 90 minutes and many transactions, of varying types, can be in the process of completion simultaneously.

 

If the Company did not have the fiat monies
necessary to complete the purchase, then the Company would not initiate the transaction in Step 1.

  Use of Digital Assets At a subsequent time, the Digital Assets, indefinite – li v e d intangible assets, are then owned and controlled by the Company , subject to impairment, and will be used in subsequent activities such as future sales of Digital Assets to ATM or OTC clients. Digital Assets, which are indefinite-lived intangible assets, are not held as “inventory”.
  Accounting

Digital Assets are indefinite-lived intangible
assets. An indefinite-lived intangible asset is initially carried at the value determined in accordance with ASC 350-30-30-1, ASC 805-50-30-2,
and is not subject to amortization.

 

Digital Assets purchased through this method
are subject to the Company’s impairment policy for impairment of indefinite-lived intangible assets which is in accordance with
ASC 820.

 

The Company records the cost of the Digital
Assets acquired as the price paid to the customer, in the form of paper monies dispensed by the ATM. These costs are recorded using the
gross amount, as the Company acted as a principal in the transaction.

 

The performance obligation for this transaction
is to wire fiat currency. Once the instructions for sending the wire have been successfully transmitted to the Company’s bank, the
Company would record the journal entries in its books and records for this transaction as a debit to Purchases for the amount of the outgoing
wire and credit to Cash.

Purchase of Digital Assets via Exchange

 

How we purchase Digital Assets as a principal

 

Terms of Service for this activity differ by exchange and
are available at the websites of various Digital Asset Exchanges.

Step 1.

During this step the Digital Assets are owned
by other users of a Digital Asset Exchange but the identities of those users are not known by name to the Company.

 

The Company wires sovereign funds to a Digital
Asset Exchange, which are then credited to our account.

 

The Digital Asset Exchange is the custodian
of the Company’s sovereign funds. The Digital Asset Exchange is the custodian for any Digital Assets for which they list markets.

  Step 2.

The Company, using its proprietary methods,
enters orders into the exchange to purchase Digital Assets. When those orders are filled, the Company records the purchase price as the
total cost of the transaction including any exchange fees.

 

During this Step the Company takes ownership,
but not all forms of control over the Digital Assets. The Digital Assets remain in the custody of the Digital Asset Exchange, although
the Company has the right to transfer, to access via withdrawal, and all risks and rewards from the fluctuations in the market price of
the Digital Asset. The Digital Asset Exchange could hypothecate the asset, loan it to another party, or pledge the Company’s Digital
Asset, but must also stand ready to allow the Company to withdraw the Digital Asset. We cite the AICPA Guide in making the determination
that we do not have all of the factors of control at this Step. However, we have legal ownership as soon as the buy order is filled on
the Digital Asset Exchange and would record the transaction as finalized on our books and records for cost purposes.

  Step 3. The Company initiates the transfer from the Exchange to its wallet which is owned and controlled by the Company and can be used in subsequent activities such as future sales of Digital Assets to ATM or OTC clients.

 

 

 

 

 

 

  Custody

The Company does not custody fiat funds or
Digital Assets on behalf of clients.

 

The Company relies on the Digital Asset Exchange
to custody its fiat funds and its digital assets that are involved in this transaction.

  Third Party Reliance The Company relies on its own funds to purchase digital assets. The Company does not rely on, or contract with, or engage any other third-party when purchasing digital assets from an exchange.
  Not a Broker The Company does not actively dispose of the Digital Assets to other third parties or transfer control of the Digital Assets to third parties during the transaction steps described above. If the Company did not have sufficient sovereign funds to complete Step 1, then the Company would not be able to initiate such a wire transfer.
  Use of Digital Assets At a subsequent time, the Digital Assets, indefinite-lived intangible assets, are then owned and controlled by the Company, subject to impairment, and will be used in subsequent activities such as future sales of Digital Assets to ATM or OTC clients. Digital Assets, which are indefinite-lived intangible assets, are not held as “inventory”.
  Accounting

Digital Assets held by the Company, and purchased
in this manner, are subject to impairment.

 

The Company records the cost of the Digital
Assets acquired as the price paid on the Digital Asset Exchange including any fees or commissions. These costs are recorded using the
gross amount, as the Company acted as a principal in the transaction.

 

The performance obligation for this transaction
is to wire fiat currency. Once the instructions for sending the wire have been successfully transmitted to the Company’s bank, the
Company would record the transaction as a debit to Purchases for the amount sent to the Digital Asset Exchange and a credit to Cash. Any
funds sent to the exchange that were not fully transacted into digital currencies are recorded as Prepaid assets at the end of the each
month.

Purchase of Digital Assets via OTC Dealer

 

How we purchase Digital Assets as a principal

 

A contract, for illustrative purposes only, with one such OTC
Dealer for this activity is filed as Exhibit 10.31

Step 1.

The Company enters into an agreement with an
OTC Dealer to purchase a Digital Asset, indefinite-lived intangible asset. This is often done by phone or electronic communications.

 

During this Step, the Company does control
the Digital Asset, but has established a contract to purchase a Digital Asset if it fulfills its obligation, which is to wire funds.

Step 2.

The Company sends sovereign funds, in the form
of bank wires, to the OTC Dealer.

 

During this Step, the Company performs its
obligation under the contract with the OTC Dealer to wire funds.

 

The Company does not custody fiat funds on
behalf of any third parties. The Company does not purchase Digital Assets on behalf of third parties. The Company does not deal with agents
who might intermediate transactions between the Company and an OTC Dealer. The Company only uses its own assets to purchase Digital Assets.

  Step 3.

Once the OTC Dealer is satisfied with the funds
that the Company has wired from its own bank accounts and never from any third party, and never using a different Digital Asset, then
the transaction moves into the delivery phase.

 

The OTC Dealer initiates the transfer of the
Digital Asset from its wallet to a wallet owned and controlled by the Company. Subsequently, the Digital Asset can be used in activities
such as future sales of Digital Assets to ATM or OTC clients.

 

The Company records the purchase price of the
Digital Asset as cost of acquiring the Digital Asset. OTC Dealers quote prices including any and all fees.

 

 

 

 

 

 

  Custody The Company does not rely on any third-party custodian, other than its bank, for custody of its fiat funds related to this transaction. The Company does not rely on any third-party custodian of its Digital Assets related to this transaction.
  Third Party Reliance The Company does not engage any third-party service to perform any of the actions related to the purchase of digital assets from an OTC dealer. The Company only engages directly with the OTC dealer and is not intermediated in the transaction.
  Not a Broker The Company does not actively dispose of the Digital Assets to other third parties or transfer control of the Digital Assets to third parties during the transaction steps described above. The time between Steps 1 and 2 can be 60 to 90 minutes. If the Company did not have the fiat monies necessary to complete the purchase, then the Company would not initiate the transaction in Step 1.
  Use of Digital Assets At a subsequent time, the Digital Assets, indefinite-lived intangible assets, are then owned and controlled by the Company, subject to impairment, and will be used in subsequent activities such as future sales of Digital Assets to ATM or OTC clients. Digital Assets, which are indefinite-lived intangible assets, are not held as “inventory”.
  Accounting

The accounting procedures for the purchase
of a Digital Asset via an OTC dealer are the same as for any other purchase of a Digital Asset. Digital Assets are indefinite-lived intangible
assets. An indefinite-lived intangible asset is initially carried at the value determined in accordance with ASC 350-30-30-1, ASC 805-50-30-2,
and is not subject to amortization.

 

Digital Assets purchased through this method
are subject to the Company’s impairment policy for impairment of indefinite-lived intangible assets which is in accordance with
ASC 820.

 

Our performance obligation for this transaction is to wire fiat currency and record
a debit to Cash and credit to Purchase. We consider the transaction finalized when the OTC Dealer’s obligation to transmit Digital
Assets is fulfilled. The entire process takes between 60 and 90 minutes and is accounted for as occurring concurrently. The Company has
never had a failure to deliver that has resulted in additional expenses or liabilities.

 

We record this transaction as a single point
in time transaction.

  

Impact of COVID-19

 

The significant global outbreak of COVID-19
has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide and has affected
our business in several ways. First, we have been unable to ship our ATMs freely between countries. Second, it has restricted the movement
of our employees and their ability to both collaborate in-person, and to do some field-service and installation work. In addition, the
continued spread of COVID-19 and the imposition of related public health measures have resulted in, and is expected to continue to result
in, increased volatility and uncertainty in the crypto-economy. We also rely on third party service providers to perform certain functions.
Any disruptions to a service providers’ business operations resulting from business restrictions, quarantines, or restrictions
on the ability of personnel to perform their jobs could have an adverse impact on our service providers’ ability to provide services
to us.

 

We are responding to the global outbreak of
COVID-19 by taking steps to mitigate the potential risks to us posed by its spread and the impact of the restrictions put in place by
governments to protect the population. Our employees and service providers have transitioned to work-from-home.

 

 

 

 

 

 

 

Trends and Uncertainties

 

Our business is subject
to the following trends and uncertainties:

 

· Adoption
of crypto assets as a medium of exchange by merchants and their trading partners could decrease
and reduce the demand for crypto asset transactions at the Company’s Bitcoin ATMs.
     
· Adoption
of crypto assets as a store of value by investors could decrease and reduce the demand for
crypto asset transactions at the Company’s Bitcoin ATMs.
     
  · The total
number of Bitcoin ATMs could reach a saturation in the markets where the Company operates. And the demand, as measured on a per
Bitcoin ATM basis, would decrease.

 

Components of Results of Operations

 

Revenue

 

Since 2019, the Company has derived approximately
95% of its revenue from the sale of Bitcoin through its network of ATM machines and its over-the-counter desk. As the Company expands
its operations, the Company expects additional revenue from its white label and ancillary business lines. For the period ended
December 31, 2021, white label business operations in El Salvador that started during the year, generated almost 2.5% of total revenue
while ancillary business activities contributed less than 0.7% of total revenue.

 

Cost of Revenue

 

Cost of revenues consists primarily of expenses
related to the acquisition of crypto assets. In accordance with ASC 805-50-30-2, the crypto asset is recorded at cost of acquisition,
i.e., it is inclusive of any surcharge or markdown. The Company assigns the costs of crypto assets sold in its revenue transactions
on a first-in, first-out basis. The crypto asset acquired is included with other crypto assets owned by the Company and the asset
on hand at end of each period is subjected to the same impairment accounting policy.

 

Digital assets classified as indefinite-lived
intangible assets are initially measured at cost and are impaired when the quoted price of the digital asset is less than the price associated
with the carrying value of that digital asset. Impairment expense is reflected in impairment of crypto assets held in the consolidated
statement of operations.

 

Additionally, cost of revenues includes the cost
of installing the ATMs (including shipping and handling expenses), the costs of operating the ATMs from which crypto assets are sold
(including the associated rent expense, related incentives, ATM cash losses, software licensing fees for the ATMs, depreciation, general
liability insurance, and utilities), fees paid to service the ATM machines and transport cash to the banks, and outsourced customer support
staff for white label and ancillary services.

 

Operating Expenses

 

The Company’s expenses consist of salaries and benefits, general and administrative expenses, sales and marketing expenses, and other operating expenses. The Company sees
opportunities for growth as the economies of the countries it operates in recover from the COVID-19 pandemic and additional machines
are deployed. As such, we expect our operating expenses to increase in future periods. As our ATM count and sales volume increase, we
expect to see increases in direct salaries and benefits. As we invest in new opportunities, we expect to see increases in sales and marketing,
and general and administrative expenses, including public company operating costs.

 

 

 

 

 

 

Salaries and Benefits

 

Cost of salaries and benefits
includes all employee-related expenses. Employee-related costs recorded in salaries and benefits consist of salaries, taxes, benefits
and equity-based compensation.

 

Sales and Marketing

 

Sales and marketing expenses consist primarily
of costs of general marketing and promotional activities, advertising fees used to drive subscriber acquisition, commissions, the production
costs to create our advertisements. The Company doesn’t have employees who solely manage our marketing and brand, and there
are no expenses related to salaries and benefits of such employees and other allocated overhead costs.

 

General and Administrative

 

General and administrative expenses consist
primarily of non-personnel costs, such as legal, accounting, and other professional fees, not expensed under salaries and benefits. In
addition, general and administrative expenses include rent and travel costs, and all other supporting corporate expenses not allocated
to other departments.

 

Interest Expense

 

Interest expense, net consists
of interest expense, and includes amortization of debt discount and issuance costs.

 

Fees on Crypto Asset
Borrowings

 

Fees on crypto asset borrowings is the fair
value of fees payable, typically in the crypto asset borrowed, on the outstanding borrowings of crypto assets calculated as percentage
of principal outstanding and current price of the crypto asset in which it is payable.

 

Provision for (Benefit
from) Income Taxes

 

The Company was taxed as a partnership for U.S.
federal and state income tax purposes for tax years prior to 2020. There is no provision for income taxes for those years. The Company
accrues liabilities for uncertain tax positions that are not more likely than not to be sustained upon examination as of December 31,
2021 and 2020. Interest and penalties related to uncertain tax positions are recorded in accrued liabilities in the accompanying consolidated
balance sheets. The Company had no unrecognized tax benefits at December 31, 2021 and 2020, that, if recognized, would affect its annual
effective tax rate.

  

 

 

 

 

 

 

Results of Operations

 

Comparison of the Years Ended December 31, 2021 and 2020

 

The table below sets forth, for the periods presented, certain
historical financial information.

 

    Year Ended December 31  
    2021     2020     $ Change     % Change  
    (in thousands, except number of shares)  
                         
Revenues   $ 81,747     $ 68,937     $ 12,810       19%  
Cost of revenues     76,178       62,390       13,788       22%  
Gross profit     5,569       6,547       (978 )     (15% )
                                 
Operating expenses:                                
Technology and development     143       86       57       66%  
General and administrative     4,153       3,070       1,083       35%  
Sales and marketing     647       286       361       126%  
Theft of bitcoin     1,600             1,600       n.m.  
Other operating expenses     231       55       176       320%  
Total operating expenses     6,774       3,497       3,277       94%  
                                 
Income (loss) from operations     (1,205 )     3,050       (4,255 )     (140% )
                                 
Fair value adjustment on crypto asset borrowing derivatives     515       1,061       (546 )     (51% )
Interest expense     661       990       (329 )     (33% )
Fees on borrowings     341       466       (125 )     (27% )
Other (income) expense     39       (55 )     94       171%  
Income (loss) before income taxes     (2,761 )     588       (3,349 )     (570% )
Income tax expense     883       428       455       106%  
Net income (loss)   $ (3,644 )   $ 160     $ (3,804 )     n.m.  
                                 
Comprehensive income (loss)                                
Net income (loss)   $ (3,644 )   $ 160     $ (3,804 )     n.m.  
Foreign currency translation adjustment     (60 )     20       (80 )     (400% )
Comprehensive income (loss)   $ (3,704 )   $ 180     $ (3,884 )     n.m.  

 

 

 

 

 

 

 

Revenue

 

    Year Ended December 31  
    2021     2020     $ Change     % Change  
    (in thousands)        
                         
Athena ATM   $ 63,097     $ 55,268     $ 7,829       14%  
Over-the-counter     15,874       13,579       2,295       17%  
White label     2,083             2,083       n.m.  
Ancillary     584             584       n.m.  
BitQuick, and other     109       90       19       21%  
    $ 81,747     $ 68,937     $ 12,810       19%  

 

    2021     2020     $ Change     % Change  
    (in thousands)        
Revenue                                
    United States   $ 78,624     $ 68,134     $ 10,490       15%  
    El Salvador     2,538             2,538       n.m.  
    International     585       803       (218 )     (27% )
    $ 81,747     $ 68,937     $ 12,810       19%  

 

Athena ATM revenue increased $7,829,000 or
14%. Average transaction size for all crypto assets increased from $523 to $656, or 25% while number of transactions decreased from 105,500
to 96,132, or 9%. Number of ATMs increased from 132 to 298, or 126%. The table below shows Bitcoin sales in Athena ATM. 

 

Bitcoin Sales (ATM)  

Twelve
Months Ended

December
31

 
    2021     2020     % Change  
Quantity sold     1,154       4,234       (73% )
Average selling price   $ 52,902     $ 12,767       314%  
Average mark up     14.50%       15.70%       -120 bps  
% Athena ATM revenue (1)     97%       98%          

___________________

Note: n.m. defined as not meaningful.

(1) Ethereum, Litecoin, and BCH accounted for
the remaining revenue.

 

Over-the-counter revenue increased $2,295,000
or 17%. Average transaction size for all crypto assets increased from $32,381 to $78,817 or 135% while number of transactions decreased
from 419 to 209, or 50%. The table below shows Bitcoin sales in Over-the-counter.

 

Bitcoin Sales (AIS/OTC)  

Twelve
Months Ended

December
31

 
    2021     2020     % Change  
Quantity sold     303       1,306       (77% )
Average selling price   $ 47,806     $ 10,228       367%  
Average mark up     3.98%       4.60%       -62bps
% Over-the-counter revenue (1)     91%       98%          

____________________

Note: n.m. defined as not meaningful.

(1) Ethereum and Litecoin accounted for the
remaining revenue in 2021 and in 2020. BitQuick and other revenue increased $19,000 or 22% due to changing customer preferences.

 

 

 

 

 

 

 

Cost of Revenues and Gross Profit

 

Cost of revenues is comprised primarily of
the expenses related to the acquisition of crypto assets sold and the costs of operating the ATMs from which the crypto assets are sold.
For the year ended December 31, 2021 and 2020, the expenses related to the acquisition of crypto assets sold were $69,740,000 and $59,540,000,
respectively. Impairment of crypto assets held for the year ended December 31, 2021 and 2020 were $44,000 and $35,000 respectively. The
increase in expenses related to acquisition of crypto assets sold was primarily a result of the increased sales of crypto assets. For
the year ended December 31, 2021 and 2020, the costs of operating the ATMs were $5,385,000 and $2,850,000, respectively. Vendors are
paid in both sovereign and crypto currency. The payment of these expenses is timed closely with the recognition of the expense. The appropriate
gain or loss on these transactions are recognized as part of Other (income) expenses in the Consolidated Statement of Operations and
Comprehensive Income. The increase in operating the ATMs was primarily driven by the 126% increase in ATMs installed.

 

Gross profit decreased $979,000 or 15%, due
to slower Athena ATM revenue growth in the U.S. vs. the direct expenses to operate the existing and newly installed machines.

 

Operating Expenses

 

Total operating expenses increased $3,277,000
or 94%, primarily due to theft of bitcoin of $1,600,000 and general and administrative expenses of $1,083,000 detailed in the table below.

  

    Year Ended December 31        
(in thousands)   2021     2020     $ Change     % Change  
General and administrative expenses   $ 1,398     $ 435       963       221%  
Salaries and benefits     2,350       2,429       (79 )     (3% )
Travel     309       39       270       692%  
Rent     96       167       (71 )     (43% )
    $ 4,153     $ 3,070     $ 1,083       35%  

 

General and administrative expenses increased
$1,083,000 or 35%, to business expansion and infrastructure investment.

 

    Year Ended December 31  
(in thousands)   2021     2020     $ Change     % Change  
Advertising   $ 258     $ 151     $ 107       71%  
Salaries and benefits     365       132       233       177%  
Other selling and marketing     24       3       21       700%  
    $ 647     $ 286     $ 361       126%  

 

Sales and marketing expenses increased of
$361,000 or 126%, due to branding and building the formal marketing and sale infrastructure.

  

Fair Value Adjustment on Crypto Asset Borrowing
Derivatives

 

    Year Ended December 31  
(in thousands)   2021     2020     $ Change     % Change  
Fair value adjustment on crypto asset borrowing derivatives   $ 515     $ 1,061     $ (546 )     (51% )

 

Fair value adjustment on crypto asset borrowing
derivatives decreased $546,000 or 51%, due to the full payment of the outstanding amount of Bitcoin borrowed (host contract) in 2021.
See Note 10 to our Audited Consolidated Financial Statements for the year ended December 31, 2021 and 2020.

 

 

 

 

 

 

 

Interest and Fees on Crypto Asset Borrowings

 

    Year Ended December 31        
(in thousands)   2021     2020     $ Change     % Change  
Interest expense   $ 661     $ 990     $ (329 )     (33% )
Fees on crypto asset borrowings     119       337       (218 )     (65% )
Fees for virtual vault services     222       129       93       72%  

 

Interest expense decreased $329,000 or 33%,
of which $224,000 was due to an accounting standard update (ASU 2020-06) and the remainder to a reduction in long-term debt.

 

Fees on crypto asset borrowings decreased
$218,000 or 65%. The net decrease is primarily due to a 30 bitcoin decrease in the principal balance outstanding (30 bitcoin as of December
31, 2020 and 0 bitcoin as of December 31, 2021). In addition to the $218,000 reduction due to the decreased principal balance there was
a decrease in the fair value adjustment on crypto asset borrowings of $546,000 from December 31, 2020 to December 31, 2021.

 

Income Tax Expense (Benefit)

 

Income tax expense increased $455,000, primarily
due to income tax expense of $700,000 paid to the government of El Salvador and statutory federal tax benefit on net loss of $245,000.

 

Net Loss Attributable to Common Stockholders

 

We realized a net loss attributable to common
stockholders of $3,644,000, or (0.00090) cents per share, for the year ended December 31, 2021, compared to a net income attributable to
common stockholders of $160,000, or 0.00004 per share, during the year ended December 31, 2020, representing a decrease in net income
attributable to common stockholders of $3,804,000.

 

Financial Condition

 

The table below sets forth certain financial information
for the periods presented.

 

    December 31     December 31     Y-o-Y(1)     Y-o-Y(1)  
(in thousands)   2021     2020     $ Change     % Change  
Current assets   $ 7,948     $ 2,201     $ 5,747       261%  
Property and equipment, net     2,903       788       2,115       268%  
Others     4,150       3,486       664       19%  
Total   $ 15,001     $ 6,475     $ 8,526       132%  
                                 
Current liabilities   $ 11,999     $ 4,312     $ 7,687       178%  
Long-term liabilities     10,576       5,435       5,141       95%  
Shareholders’ deficit     (7,574 )     (3,272 )     (4,302 )     (131%  
  Total   $ 15,001     $ 6,475     $ 8,526       132%  

_______________________

(1) Percentage change from December 31, 2020
to December 31, 2021.

 

 

 

 

 

 

As of December 31, 2021, we had total assets
of $15,001,000 compared to total assets of $6,475,000 as of December 31, 2020. This increase was primarily due to an increase in accounts
receivable of $1,531,000, restricted cash held for customers of $3,671,000, which is offset by a liability to customers of $3,671,000,
and other advances of $845,000. The increase in accounts receivable was primarily due to revenue from our contracts with the Department
of Treasury (Ministerio de Hacienda) of El Salvador. The Company has collected $1,577,000 of the amount due as of May 12, 2022, of the
accounts receivable at December 31, 2021. There was an increase of $2,220,000 due to investments in property and equipment, primarily
ATM machines in El Salvador and U.S. We had no balance for accounts receivable and restricted cash held for customers as of December
31, 2020.

 

Our crypto assets held was $842,000 as of
December 31, 2021, as compared to $1,343,000 as of December 31, 2020. This decrease was due to lower levels of crypto assets
held and not restocking to match the bitcoin borrowings after the theft of 29 bitcoin in March 2021. Crypto asset borrowings from a
related party decreased from $881,000, fair value of 30 bitcoin, as of December 31, 2020, to $0, fair value of 0 bitcoin, as of
December 31, 2021, as we to repaid all borrowed bitcoin. We do not intend to borrow additional crypto assets in the foreseeable
future and intend to raise equity funds or debt capital to finance working capital and investment as needed. No assurances can be
made that we will be successful in such efforts.

 

Our leased assets increased from $2,067,000
as of December 31, 2020, to $2,318,000 as of December 31, 2021, primarily due to the increase in locations leased for ATMs. There was
also an equivalent decrease in the Company’s lease liabilities (current and long-term). The current portion of the Company’s
long-term debt increased from $1,354,000 as of December 31, 2020 to $1,959,000 as of December 31, 2021, due to of $1,955,000 becoming
due within one year offset by a decrease of $1,350,000 debt repaid during the period using cash flows from operations.

 

The Company increased its capital resources
in 2021 over the twelve months ended December 31, 2020. Our cash on hand increased by $2,760,000 compared to the balance on December
31, 2020, primarily due to increase in restricted cash held for customers of $3,671,000 offset by decreases in cash and cash equivalents
of $911,000.

 

Liquidity and Capital Resources

 

As of December 31, 2021, we had current assets
of $7,948,000 and current liabilities of $11,999,000, including the current portion of the long-term note held by Consolidated Trading
of $1,490,000 and advances for revenue contracts of $3,500,000, resulting in a deficit working capital of $4,051,000. The revenue contract
above refers to the sale of IP Software to the government of El Salvador which, for accounting purposes, is being termed Advances for
revenue contract until such time as the XPay acquisition has been finalized.

 

Our working capital needs are influenced by
our level of business operations and generally increase with higher levels of revenue. We strive to minimize the amount of working
capital deployed to enhance liquidity. During the year, we raised $4,985,000 in 6% Convertible Debentures in addition to a net increase
$141,000 in additional debt. The additional financing provided sufficient working capital for current needs. The Company continues its
efforts to supplement financial resources through raising equity and debt capital as well as generating cash inflow from operations.
No assurances can be made that we will be successful in our equity and/or debt fund raising efforts.

 

We measure our liquidity internally for management
purposes on an operational basis which we define as cash and accounts receivable less accounts payable and accrued expenses, other short-term
liabilities, income tax payable and liabilities for cash held for customer (also in cash as restricted, net $0 effect) and excluding
any short-term financing. As of December 31, 2021, operational working capital was $1,461,000 and as of December 31, 2020, was $1,171,000.
Management believes this measurement of liquidity is a more accurate reflection of liquidity to facilitate operations and how we manage
our daily obligations.

 

Our ATM business has two significant components
of working capital – holdings of crypto assets and cash holdings in the machines and in transit, i.e., once it has been removed
from the machines and it is the process of being counted and credited to our account with the appropriate banking institution. We must
buy our holdings in cash and don’t get credit from our counterparties. On average, we hold 3 to 5 days of anticipated sales of
Bitcoin and 7 to 10 days of anticipated sales of Ethereum, Litecoin, and BCH holdings. We strive to keep this period short to reduce
the effect of changes in crypto asset/U.S. dollar exchange rates on our business and to minimize our working capital. Our cash logistics
contractors restock or remove cash from our machines periodically, the frequency of this service determined by a host of operational
considerations like historical trend of sales, current levels of cash in the machines, route considerations, public holidays, and incremental
cost of each removal etc. We employ a data driven strategy based on factors we have developed over the years to reduce the amount
of cash deployed and to keep it as low as possible. It currently takes from 3 to 7 days from the time the cash is picked up from
the machines to be credited to our account. An increase in this period or amount impacts our ability to restock our holdings of crypto
assets in a timely manner to avoid a situation where there are insufficient amounts of crypto assets to fulfill customer orders.

 

For the fiscal year ending December 31, 2021,
the average cash balance was $4,092 per machine in the United States.

 

 

 

 

 

The employees of the Company regularly, at intervals
of 3-hours or less, monitor the balance of Digital Assets owned and controlled by the Company. When employees of the Company, using their
professional discretion, believe that there are insufficient amounts of Digital Assets owned and controlled by the Company, they initiate
the purchase of additional Digital Assets. There have been periods of time, each less than 24-hours, where there have not been sufficient
amounts of Digital Assets owned and controlled by the Company to execute future customer transactions. During those times, no customer
transactions are permitted. The employees of the Company use the working capital of the Company to purchase more Digital Assets, during
times when banking transactions are permitted, and once those Digital Assets are delivered to the Company and owned and controlled by
the Company, customer transactions are again permitted.

 

Our OTC desk (phone sales) has a lower level of
capital required since we only function on days other market participants and banks are operating and our trades are cash settled every
day. The Company does not separately hold crypto assets earmarked for ATM sales as opposed to phone sales and the Company holds approximately
3 or 4 days’ worth of crypto assets needed for transactions at its ATMs. We strive to minimize the amount of working capital deployed
for better financial results.

 

On July 12, 2021, the Company signed a loan restructuring
agreement for the remaining of outstanding Bitcoin balance as of that date. Under the agreement Mr. Komaransky, the Company’s
largest shareholder, agreed to extend the maturity for the entire amount of the loan to May 31, 2022, and certain other modified
terms which included the conversion of the borrowings into a U.S. dollar loan when the published exchange rate of Bitcoin for U.S. dollars
is equal to or exceeds a ratio of 1 bitcoin: U.S. $75,000 at the first time and on the first date after June 30, 2021. The Company, under
the agreement, created a first priority security interest and lien on all its property excluding property that has been given as collateral
to Consolidated Trading Futures, LLC (“CTF”) until the repayment of the outstanding debt to CTF. Further, the Company agreed
to pay accelerated weekly payments of $35,000 in bitcoin. As of December 31, 2021, there is no remaining balance under the loan restructuring
agreement. We continue to make efforts to obtain additional resources to meet the financial needs of our business.

 

In the 2022 fiscal year, the Company has one materially
significant debt due, the note held by CTF (the “Consolidated Note”). As of December 31, 2021, the principal balance of the
Consolidated Note was $1,490,000. The Company makes monthly interest payments on the Consolidated Note, but as of the date of this prospectus,
has not paid down the principal. To retire this debt in 2022, the Company expects to use cash inflow from operations and other working
capital.

 

The Company has no material commitments for capital
expenditures.

 

Loan Agreement with the Company’s Director
and Shareholder

 

On August 22, 2018, the Company entered into
a crypto asset borrowing agreement with Mr. Komaransky, the Company’s principal shareholder and a former director. Under this
agreement, the Company borrowed 30 bitcoin initially due and payable on August 22, 2019. The borrowing fee on the loan as defined in
the agreement, is 13.5% of the outstanding principal amount. On July 12, 2021, the Company and Mr. Komaransky entered into a borrowing
restructuring agreement for the remaining outstanding Bitcoin balance as of that date. Under the terms of the agreement, the maturity
of the borrowings was extended to May 31, 2022 and the Company agreed to make weekly repayments of $35,000 in Bitcoin. On a weekly basis,
the Company intends to utilize cash flows from operations and other financings to obtain the Bitcoin necessary for the weekly repayments.
As discussed in further detail in Notes 1 and 5 to our consolidated financial statements for the year ended December 31, 2020 and 2019,
the crypto assets borrowings are accounted for as hybrid instruments, with a liability host contract that contains an embedded derivative
based on the changes in the fair value of the underlying crypto asset. The host contract is not accounted for as a debt instrument because
it is not a financial liability and is carried at the fair value of the assets acquired on the date acquired. The embedded derivative
is accounted for at fair value (based on the underlying Bitcoin value), with changes in fair value recognized in other non-operating
expenses in the consolidated statements of operations and comprehensive income. The host contract and embedded derivative are presented
together in Related party crypto asset borrowings in the consolidated balance sheets.

 

The Company intends to utilize cash from operations
to repay its related party crypto asset borrowing obligation (not directly related to the theft of Bitcoin). On July 12, 2021, the Company
entered into a borrowing restructuring agreement for the remaining outstanding bitcoin balance as of that date. Under the terms of the
agreement, the maturity of the borrowings was extended to May 31, 2022 and the Company agreed to make weekly repayments of $35,000 in
Bitcoin.

 

 

 

 

 

 

Cash Flow

 

The following summarizes our cash flow for
the year ended December 31, 2021 and 2020:

 

    Year Ended December 31  
    2021     2020     $ Change     % Change  
    (in thousands)  
Net cash used in operating activities   $ (4,145 )   $ (6,057 )   $ 1,912       32%  
Net cash provided by investing activities     1,779       5,461       (3,682 )     (67% )
Net cash provided by financing activities     5,126       2,345       2,781       119%  
Net increase in cash and cash equivalents     2,760       1,749       1,011       58%  
Cash and cash equivalents, beginning of period     2,085       336       1,749       521%  
Cash and cash equivalents, end of period   $ 4,845     $ 2,085     $ 2,760       132%  

 

Cash flow from operating activities

 

Operating activities used $4,145,000 in cash
for the twelve months ended December 31, 2021, compared to a use of $6,057,000 for the twelve months ended December 31, 2020 representing
a decrease in cash used of $1,912,000. The changes in sources of cash from operating activities for the twelve months ended December
31, 2021, comprised primarily of an increase from advances for revenue contracts $3,500,000; increase from restricted cash held for customers
of $3,671,000, decrease of $379,000 in non-cash charges and increase in accounts payable and other liability of $340,000. This was offset
by the increase of $909,000 in crypto asset payments for expenses, theft of bitcoin $1,600,000, gain on sale of crypto assets $194, increase
in value of accounts receivable by $1,531,000, increase in advances of $730,000, increase in prepaid expenses and other assets of $1,208,000,
and an increase in net loss of $3,804,000 and all other at $650,000. Operating activities used less cash in the twelve months ended December
31, 2021, compared to the twelve months ended December 31, 2020.

 

Cash flow from investing activities 

 

Our investing activities provided
$1,779,000 in cash for the year ended December 31, 2021 which included a cash inflow of $78,972,000 from sale of crypto assets
offset by $74,973,000 of cash outflow on purchase of crypto assets, and $2,220,000 towards purchase of property and equipment to
expand our fleet of ATMs including $1,194,000 as investment in our fleet of white label ATMs and other assets in El Salvador. For
the year ended December 31, 2020, investing activities provided $5,461,000 which included a cash inflow of $68,818,000 from sale
of crypto assets offset by $62,498,000 of cash outflow on purchase of crypto assets, and $859,000 towards purchase of property and
equipment to expand our fleet of ATMs.

 

Cash flow from financing activities 

 

For the year ended December 31, 2021, net
cash provided by financing activities was $5,126,000, primarily due to the issuance of issuance of 8% convertible debt for $4,985,000
and $141,000 proceeds from additional net debt. For the year ended December 31, 2020, net cash provided by financing activities was $2,345,000,
primarily due to the issuance of convertible debt for $3,125,000 and repayment of debt for $731,000.

 

Capital Expenditure Commitments and Off-Balance
Sheet Arrangements

 

The Company has no material commitments for capital
expenditures. The Company is not a party to any off-balance sheet transactions except for the safeguarding of certain assets for the
government of El Salvador. Under our agreements with the government of El Salvador, the Chivo branded ATMs are provided with operating
capital including USD and Bitcoin, over which the Company has responsibilities to safeguard, manage the loading and unloading of the
ATMs, and maintain a balance between USD and Bitcoin by entering trades within the Chivo systems. We have no guarantees or obligations
other than those which arise out of normal business operations.

 

 

 

 

 

 

Critical Accounting Policies and Estimates

 

Our financial statements and accompanying notes
have been prepared in accordance with GAAP. The preparation of these financial statements requires management to make estimates, judgments,
and assumptions that affect reported amounts of assets, liabilities, revenues, and expenses. We continually evaluate the accounting policies
and estimates used to prepare the financial statements. The estimates are based on historical experience and assumptions believed to be
reasonable under current facts and circumstances. Actual amounts and results could differ from these estimates made by management. Certain
accounting policies that require significant management estimates and are deemed critical to our results of operations or financial position.
Our critical accounting estimates are more fully discussed in Note 2 to our unaudited financial statements contained herein.

 

Revenue Recognition

 

The Company derives its revenues primarily from
two sources: (i) point of sale transactions of crypto assets at ATMs and (ii) customized investor trading services for the sale or purchase
of crypto assets. From the third quarter of 2021, it also has revenue from (i) white label operations in El Salvador and (ii) some ancillary
activities. The Company adopted ASC 606, Revenue Recognition, effective January 1, 2019, using the modified retrospective method.
Under ASC 606, Revenue Recognition, the Company recognizes revenue at the point of sale of these products or services to our customers,
in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company
determines revenue recognition through the following steps:

 

  · Identification of the contract, or contracts, with a customer

 

  · Identification of the performance obligations in the contract

 

  · Determination of the transaction price

 

  · Allocation of the transaction price to the performance obligations in the contract

 

  · Recognition of revenue when, or as, we satisfy a performance obligation.

 

The Company recognizes revenue when performance
obligations identified under the terms of contracts with its customers are satisfied. The Company’s revenue associated with ATM
and investor services are recognized at a point in time when the crypto asset is delivered to the customer. We recognize operating
fee revenues from the white label services per our agreement with the government of El Salvador on a monthly basis, at the end of the
month, when the services for the machines have been completed. The payment terms for on the agreement with the government of El Salvador
is net 60.

 

The Company controls the service as it is primarily
responsible for fulfilling the service and has discretion in establishing pricing with its customers. Adoption of the new revenue standard
resulted in no changes to the Company’s accounting policies for revenue recognition.

 

Crypto Asset Borrowings

 

The Company borrows crypto assets. Such crypto
assets borrowed by the Company are reported in crypto assets held on the Company’s consolidated balance sheets.

 

The borrowings are accounted for as hybrid instruments,
with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset.
The host contract is not accounted for as a debt instrument because it is not a financial liability, is carried at the fair value of the
assets acquired and reported in crypto asset borrowings in the consolidated balance sheets. The embedded derivative is accounted for at
fair value, with changes in fair value recognized in other non-operating expenses in the consolidated statements of operations. We
evaluate all of our loan contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to
be separately accounted for under ASC 815, Derivatives and Hedging. The embedded derivatives are included in crypto asset borrowings
in the consolidated balance sheets.

 

 

 

 

 

 

Stock-based Compensation

 

The Company accounts for stock-based compensation
according to the provisions of ASC 718, Stock Compensation, which requires the measurement and recognition of compensation expense for
all stock-based awards made to employees and directors, including employee stock options and non-vested stock awards, based on the fair
values on the dates they are granted. The Company records the fair value of awards expected to vest as compensation expense on a straight-line
basis over the requisite service periods of the awards, which is generally the vesting period.

 

The Company uses the Black-Scholes option pricing
model for determining the estimated fair value for stock-based awards. The Black-Scholes option pricing model requires the use of highly
subjective and complex assumptions, which determine the fair value of stock-based awards, including the options expected term, expected
volatility of the underlying stock, risk-free rate, and expected dividends. The expected volatility is based on the average historical
volatility of certain comparable publicly traded companies within the Company’s industry. The expected term assumptions are based
on the simplified method, due to insufficient historical exercise data and the limited period of time that the Company’s equity
securities have been available for issuance. The risk-free interest rates are based on the U.S. Treasury yield in effect at the time of
grant. The Company does not expect to pay dividends on common stock in the foreseeable future; therefore, it estimated the dividend yield
to be 0%.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The
Business

 

Overview

 

The Company is focused on developing, owning,
and operating a global network of Athena-branded Bitcoin ATM machines, which are free standing kiosks that permit customers to buy or
sell crypto assets in exchange for cash (banknotes) issued by sovereign governments – often referred to as fiat currencies.

 

We place our machines in convenience stores,
shopping centers, and other easily accessible locations. Our network presently includes Athena Bitcoin ATMs in 10 states and 3 countries
in Central and South America. See table below for our ATMs breakdown, as of December 31, 2021.

 

Country Number of Athena Bitcoin ATMs
(as of December 31 , 2021)
Type of Fiat Currency
Total Two-Way
United States 186 129 U.S. Dollar
El Salvador 3 3 U.S. Dollar
Argentina 12 12 Argentine peso
Argentina U.S. Dollar
Colombia 17 17 Colombian peso

 

We offer Bitcoin, Ethereum, Litecoin, and Bitcoin
Cash (BCH) for sale at all our ATM machines. We also buy these crypto assets at some of our ATM machines (also known as two-way ATMs).
The cash withdrawal limit from our two-way ATMs is $2,000 per transaction. We replenish our ATMs about twice a week or depending on usage,
using bonded security companies.

 

We also operate an over-the-counter (“OTC”)
desk for private clients and trade customers of the Company. Customers typically interact with the Company on the phone for transaction
sizes in dollar terms greater than $10,000 and on some occasions, for crypto assets not included in our ATMs. Since 2019, we have been
typically buying and selling Bitcoin through our OTC desk, but we have also executed transactions in Ethereum, Litecoin, and in some cases,
altcoins such as Bitcoin SV, Ripple, Siacoin, Tether, and Tron. As of the date of this prospectus, we do not transact in any crypto assets
except Bitcoin, Ethereum, Tether, Litecoin, and BCH. We will update this prospectus if we decide to transact in other crypto assets. Such
a change would only happen if there were significant customer demand for a specific crypto asset and that crypto asset was available to
us through multiple trading partners, digital asset exchanges and digital asset brokers.

 

Additionally, we operate ATMs and point-of-sale
(“POS”) terminals on behalf of certain customers, typically under their brand, which we refer to as “white label service”.
This white label service is comprised of maintaining ATMs and POS terminals to facilitate the exchange of crypto assets for cash, and
vice-versa, by our customers with their counterparties. We do not control the service in this case as we are not responsible for fulfilling
the exchange contract or establishing pricing at these ATMs and POS terminals. Currently, the government of El Salvador is our only white
label service customer. The Company has begun working with the government of El Salvador in late June 2021 to support the implementation
of its Bitcoin Law. In August 2021, we entered into certain agreements for services to be rendered by the Company to the Department of
Treasury (Ministerio De Hacienda) of El Salvador, pursuant to which we have installed and are operating 200 Chivo Bitcoin ATMs in El
Salvador, 10 Chivo Bitcoin ATMs at El Salvador consulates in the U.S., 45 Chivo Bitcoin ATMs in other U.S. locations, and importing and
delivering 950 Chivo point-of-sale (“POS”) terminals for local businesses in El Salvador to transact with Bitcoin. As
of December 31, 2021, we were operating 200 white label ATMs in El Salvador for the Department of Treasury (Ministerio de Hacienda) of
El Salvador. We were not operating any POS terminals on behalf of any clients as of December 31, 2021.

 

By increasing our geographic service area, including
our expansion of operations to El Salvador, we aim to make Athena Bitcoin into a global financial services company that can connect the
world’s cash to the world of crypto assets.

 

 

 

 

  

Background and Corporate History

 

The Company was incorporated in the state of Nevada
in 1991 under the name “GamePlan, Inc.” for the sole purpose of merging with Sunbeam Solar, Inc., a Utah corporation, which
merger occurred as of December 31, 1991 with GamePlan, Inc. as a sole surviving entity. The Company was involved in various businesses,
including, gaming and other consulting services, prior to becoming a company seeking acquisitions (a “shell company” as defined
in Rule 405 of the Securities Act). The Company was a reporting issuer under the Securities and Exchange Act of 1934 (the “Exchange
Act”) from 1999 until 2015 when it filed Form 15 pursuant to Rule 12g-4(a)(1) with the Commission.

 

On March 28, 2014, the Company entered into an
Agreement and Plan of Merger (the “Plan”) with VPartments; VPartments Acquisition Corp., a Georgia corporation that was formed
as a wholly-owned subsidiary of the Company (the “Merger Subsidiary”); and Mark D. Anderson, Sr., who was the beneficial owner
of approximately 60.1 percent of the issued and outstanding shares of common stock of VPartments. Under the terms of the Plan, the parties
agreed that at the closing, the Merger Subsidiary would merge with and into VPartments, with each 7.52034545757 then-outstanding shares
of VPartments common stock to be converted into the right to receive one share of the Company’s common stock. The Company issued
a total of 150,525,000 “restricted” shares of its common stock to the stockholders of VPartments Inc., causing such stockholders
to become the collective owners of approximately 90.8 percent of the Company’s issued and outstanding shares of common stock. In
connection with the change of control pursuant to the Plan, the Company’s then current officers and directors resigned, and the
new officers and directors were appointed. The Company (GamePlan, Inc.) had no operations and was seeking acquisitions from April, 2014
until January 30, 2020. The Company (GamePlan, Inc.) did not enter into any debt obligations during that period.

 

In July, 2018, Magellan Capital Partners, Inc.,
a Wyoming corporation, became a majority shareholder of the Company after purchase of 90,421,378 shares of common stock (approximately
55%) in a private transaction with a majority shareholder, Mark D. Anderson. Following the acquisition of control, Dempsey Mork, a beneficial
owner of Magellan Capital Partners, Inc., was appointed a sole officer and director of the Company, and subsequently elected as its sole
director in November, 2018 shareholders’ meeting. On December 6, 2018, Mr. Mork entered into an agreement with Robert Berry, a former
officer and director, to cancel all debts due to Mr. Berry from the Company in consideration for the issuance of the total of 90,421,000
shares of common stock of the Company to Mr. Berry and another shareholder.

 

On January 14, 2020, the Company entered
into a Share Exchange Agreement (the “Agreement”), by and among the Company, Athena Bitcoin, Inc., a Delaware corporation
(“Athena Bitcoin”) incorporated in 2015, and certain shareholders of Athena Bitcoin. The Agreement provides for the reorganization
of Athena Bitcoin, with and into the Company, resulting in Athena Bitcoin becoming a wholly-owned subsidiary of the Company (the “Share
Exchange”). GamePlan, Inc, had a total of 486,171,020 shares outstanding prior to the Share Exchange. The Agreement is for the
exchange of 100% shares of the outstanding common stock of Athena Bitcoin, for 3,593,644,680 shares of GamePlan, Inc. common stock (an
exchange rate of 1,244.69 shares of common stock of GamePlan, Inc. for each share of Athena Bitcoin common stock). The exchange rate
was determined by the Board of Directors of Athena Bitcoin based on the arbitrary valuation of Athena Bitcoin by its Board of Directors
and negotiations with the principals of GamePlan, Inc. No independent valuation was obtained. The authorized capital stock of Athena
Bitcoin immediately preceding the closing of the Share Exchange consisted of (i) 3,000,000 shares of the Athena Bitcoin’s common
stock, par value $0.001 per share, authorized, of which: 2,887,175 shares were issued and outstanding immediately prior to the Share
Exchange, which included the following conversion events in connection with the Share Exchange: (i) 1,328,381 shares resulting from the
conversion of certain Simple Agreements for Future Tokens (“SAFT”) issued by Athena Bitcoin in 2018 pursuant to the SAFT
provisions providing for the conversion into Athena Bitcoin equity under certain conditions (see
SAFT Investments,
page 56) were exchanged for 1,653,425,404 shares of the Company’s common stock at a conversion price of $4.09; (ii) 93,106 shares
resulting from the exercise of certain outstanding warrants at an average exercise price of $2.00 per share, issued by Athena Bitcoin
were exchanged for 115,888,490 shares of the Company’s common stock (see also Description of Capital Stock – Warrants to Purchase Common Shares, page 69 and Note 16 to the Company’s audited financial statements for the fiscal years
ended December 31, 2019 and 2020); (iii) 126,646 shares resulting from the exercise of stock options issued by Athena Bitcoin were exchanged
for 157,635,309 shares of the Company’s common stock (see Note 10 to the Company’s audited financial statements for the fiscal
years ended December 31, 2019 and 2020); and (iv) 336,692 shares resulting from the conversion of the Swingbridge Conversion and Release
Agreement were exchanged for 419,078,082 shares of the Company’s common stock (see Swingbridge Crypto LLC Loans, page 54 and Note 6 to the Company’s audited financial statements for the fiscal years ended December 31, 2019 and 2020).
The closing of the Share Exchange transaction occurred as of January 30, 2020. Following the closing date of the transaction, there were
4,079,815,704 shares of the Company’s common stock outstanding. The Company had 5,000,000,000 shares of common stock authorized
as of the closing date of the Share Exchange transaction. Subsequently, in May, 2020, following the Company’s Convertible Debenture
financing (see Recent Financings below), the Company filed its amended and restated articles of incorporation authorizing a total of
4,409,605,000 shares of common stock.

 

 

 

 

 

 

The Company approved the name change from “GamePlan,
Inc.” to “Athena Bitcoin Global” on March 10, 2021 by the unanimous consent of its Board of Directors and a majority consent
of its shareholders. The Company filed an amendment to its Articles of Incorporation with the Secretary of State of the state of Nevada
on April 6, 2021, with the effective date of April 15, 2021. The Company’s name change, and trading symbol change to “ABIT”
on OTC Pink Market were declared effective by FINRA on June 9, 2021. The Company’s Board of Directors and its shareholders approved
a 10-for-1 reverse stock split as of October 15, 2021.

 

The Company, Athena Bitcoin Global, is a Nevada
corporation which owns our 100% of our operating subsidiary, Athena Bitcoin, Inc., a Delaware corporation. Our domestic business operations
are conducted by Athena Bitcoin, Inc. We also have operating subsidiaries in the specific countries where we operate, or in the case of
Mexico, where we previously operated until 2019. Our wholly-owned subsidiaries located outside of the United States are: Athena Bitcoin
S. de R.L. de C.V., incorporated in Mexico; Athena Holdings Colombia SAS, incorporated in Colombia; Athena Holding Company S.R.L, incorporated
in Argentina; Athena Holdings of PR LLC, incorporated in Puerto Rico; and Athena Holdings El Salvador, S.A. de C.V., incorporated in El
Salvador.

 

Our corporate office is located at 1332 N Halsted
St., Suite 403, Chicago, IL 60642, and our telephone number is 312-690-4466. Our website is www.athenabitcoin.com. The information
on, or that can be accessed through, our website is not part of this prospectus and is not incorporated by reference herein.

 

Recent Financings of Athena Bitcoin Global

  

On June 22, 2021, the Company commenced its private
offering of up to $5,000,000 of 6% Convertible Debentures to accredited investors only. The maturity date on the 6% Convertible Debentures
is two years after the date of issuance. The investor has an option to convert the principal amount of the Debenture into shares of common
stock of the Company at a conversion price equal to the lesser of (i) $0.10 or (ii) 25% less than the twenty trading day (20-trading
day) volume weighted average price (“VWAP”) of the common stock based on the closing prices per share reported by the OTC
Pink Market operated by the OTC Markets Group, Inc., for said twenty-day trading period, commencing ten-trading days prior to the date
of election to convert the Debenture and ending ten-trading days after such election is made and the notice of conversion has been submitted
to the Company. The investor is required to convert the Debenture if the Company’s common stock is admitted or listed for trading
on a national stock exchange or if certain corporate transactions occur, such as merger, sale or change of control of the Company. The
accrued interest on the 6% Convertible Debentures is paid quarterly and is not subject to conversion to common stock. The holders of
the Debentures are provided with the registration rights to register the shares of common stock the Debentures are convertible into,
in a registration statement to be filed by the Company on Form S-1 with the Commission. The Company sold a total of $4,985,000 of the
6% Convertible Debentures to 77 accredited investors. The proceeds of the private placement are to be used for working capital and operations
of the Company. The Company closed its private placement as of September 30, 2021. As of March 31, 2021, $1,520,000 of the 6% Convertible
Debentures were outstanding, the remainder having converted to common stock at a price of $0.10 per share.

 

On January 31, 2020 immediately following the closing of the
Share Exchange transaction, the Company closed a private placement of its 8% Convertible Debentures in the total amount of
$3,125,000 (the “Convertible Debentures”). The closing of the private placement was subject to the closing of the Share
Exchange transaction by the Company. There were two purchasers of the Convertible Debentures: KGPLA, LLC, an entity in which a
director of the Company and the Company’s beneficial owner of 41% has ownership interest ($3,000,000 principal amount of
Convertible Debenture) and Swingbridge Crypto III, LLC ($125,000 principal amount of Convertible Debenture), an affiliate and former
noteholder of the Company – see Note 7 to the Financial Statements. The Convertible Debentures have a maturity date of January
31, 2025 and bear interest at 8% per annum. The purchasers have an option to convert the outstanding principal and accrued interest
amount of their respective Convertible Debentures into shares of common stock of the Company at the lower of $0.012 per share or 20%
discount to the next major financing or change in control. In connection with the Convertible Debentures private placement, the
purchasers acquired certain registration and voting rights. – see also Description of Capital Stock.

 

 

 

 

 

 

Debt Obligations of Athena Bitcoin, Inc. and
the Company

 

Notes

 

In 2017, Athena Bitcoin, Inc. entered into several
subordinated note agreements with shareholders of its common stock. The notes had a principal amount of $117,000 with maturity dates
in 2021 and 2022. The notes have 12% interest per annum. As of December 31, 2021, and December 31, 2020, the outstanding principal
was $117,000 and $90,000 respectively.

 

On May 30, 2017, the Company entered into a senior
note agreement with Consolidated Trading Futures, LLC. The note provided for a principal amount of $1,490,000 of the loan secured against
the Company’s cash in machines and held by service providers with a maturity date of May 31, 2022. Interest as defined in the note
is 15% per annum. As of both December 31, 2021, and December 31, 2020, the outstanding principal was $1,490,000.

 

On August 1, 2018, Athena Bitcoin, Inc. entered
into a promissory note with LoanMe, Inc. The promissory note provided for a principal amount of $100,000, with a final maturity date
of August 1, 2028, with equal monthly installment payments of $2,205. The promissory note has 24% interest per annum. As of December
31, 2021, and December 31, 2020, the outstanding principal was $87,800 and $92,400, respectively.

 

Swingbridge Crypto LLC Loans

 

On October 22, 2018, Athena Bitcoin, Inc. entered
into a loan agreement and a promissory note with Swingbridge Crypto I, LLC. The promissory note provided for an aggregate of $500,000
in principal with a maturity date of May 30, 2019. Interest as defined in the promissory note was simple interest equal to 8% per annum.
As of December 31, 2019, the outstanding principal was $500,000. The principal amount and accrued interest on the note were converted
into 153,817 shares of common stock of Athena Bitcoin, Inc. at a price of $4.09 per share. The conversion price was determined by the
negotiation of the parties with an implied valuation of Athena Bitcoin, Inc. of not less than $5 million, pursuant to the terms of the
loan agreement. Such shares of Athena Bitcoin, Inc. were then exchanged in the Share Exchange transaction (see above).

 

On May 21, 2019, the Company entered into a loan
agreement and a promissory note with Swingbridge Crypto II, LLC. The promissory note provided for an aggregate of $300,000 in principal
with a maturity date of August 21, 2019. Interest as defined in the promissory note was simple interest equal to 30% per annum. As of
December 31, 2019, the outstanding principal was $300,000. The principal amount and accrued interest on the note were converted into 40,389
shares of common stock of Athena Bitcoin, Inc. at a price of $9.24 per share. The conversion price was determined by the negotiation of
the parties with an implied valuation of Athena Bitcoin, Inc. of not less than $5 million, pursuant to the terms of the loan agreement.
Such shares of Athena Bitcoin, Inc. were then exchanged in the Share Exchange transaction (see above).

 

On July 26, 2019, the Company entered into a loan
agreement and a promissory note with Swingbridge Crypto III, LLC. The promissory note provided for an aggregate of $1,000,000 in principal
with a maturity date of July 26, 2020. Interest as defined in the promissory note was simple interest equal to 40% per annum. As of December
31, 2019, the outstanding principal was $1,000,000. The principal amount and accrued interest on the note were converted into 142,486
shares of common stock of Athena Bitcoin, Inc. at a price of $8.32 per share. The conversion price was determined by the negotiation of
the parties with an implied valuation of Athena Bitcoin, Inc. of not less than $5 million, pursuant to the terms of the loan agreement.
Such shares of Athena Bitcoin, Inc. were then exchanged in the Share Exchange transaction (see above).

 

 

 

 

 

 

In connection with the Share Exchange transaction
of the Company on January 30, 2020, and pursuant to the Swingbridge Conversion and Release Agreement, the 336,692 shares of common stock
resulting from the conversion of the above Swingbridge notes were exchanged for 419,078,082 shares of the Company’s common stock.

 

DV Chain LLC Loan

 

On November 21, 2019, Athena Bitcoin, Inc. entered
into a promissory note with DV Chain, LLC. The promissory note provided for a principal amount of $1,950,719 with a maturity date of May
1, 2021. Interest as defined in the promissory note was 15% per annum. On August 16, 2020, the Company entered into an agreement with
DV Chain, LLC, whereby the Company repurchased 30,422,825 common shares held by DV Chain, LLC at a price of $0.00388 and agreed to make
accelerated payments of $25,000 per week on the promissory note until the maturity date of May 1, 2021. As of December 31, 2020, and December
31, 2019, the outstanding principal was $1,350,000 and $1,950,719, respectively. As of March 31, 2021, the outstanding principal was $585,000.
The Company repaid the remaining principal balance and interest due on this loan on May 31, 2021.

 

SBA Loan

 

On April 15, 2020, the Company entered into a
forgivable loan agreement (SBA Loan) with Citizens National Bank of Greater St. Louis under the Coronavirus Aid Relief, and Economic Security
Act (CARES Act) administered by the U.S. Small Business Administration. The Company received total proceeds of $156,919 from the SBA Loan.
In accordance with the requirements of the CARES Act, the Company used the proceeds from the SBA Loan primarily for payroll costs and
retained the employment of full-time employees as required by the terms of the SBA Loan. The SBA Loan was scheduled to mature on April
15, 2022 and has a 1.00% interest rate. In accordance with the CARES Act and the Paycheck Protection Program Flexibility Act, the Company
applied for Loan Forgiveness for the full outstanding principal balance of the SBA Loan, which was approved in 2020. Accordingly, during
the year ended December 31, 2020, the Company recorded $156,919 in other income for the forgiveness of the SBA Loan. See also Note 6 to
our Financial Statements.

 

Loan from Banco Hipotecario

 

In September 2021, the Company’s El
Salvador subsidiary, Athena Holdings El Salvador, S.A. DE C.V. (“Athena El Salvador”) entered into a loan agreement with
Banco Hipotecario for the loan amount of $1,500,000. The loan has an interest rate of 7.5% and is secured by Athena El Salvador’s
assets in El Salvador. The maturity date is 36 months after the disbursement of the funds. The monthly payments on the loan in the equal
amounts of $49,108, begin two (2) months after the disbursement of the funds. The current balance as of December 31, 2021, is $1,500,000.
The Company intends to utilize loan proceeds to expand its fleet of Bitcoin ATMs and for other general corporate purposes. See also Note
8 (“Debt”) to the audited financial statements for the twelve months ended December 31, 2021.

 

Borrowing Agreements with the Company’s
Former-Director and Shareholder

 

On August 22, 2018, Athena Bitcoin, Inc. entered
into a loan agreement with Mike Komaransky, the Company’s principal shareholder (“Bitcoin Agreement”).
Under this Bitcoin Agreement, the Company borrowed 30 bitcoin initially due on August 22, 2019. The borrowing fee, as defined in the agreement,
is 13.5% of the outstanding principal. On July 12, 2021, Athena Bitcoin and the Company entered into Loan Restructuring and Related Amendments
Agreement (the “Restructuring Agreement”) with Mr. Komaransky and Eric Gravengaard, the Company’s CEO, director and
principal shareholder, with respect to the Bitcoin Agreement and certain other agreements. As of the date of the Restructuring Agreement,
the Company had still a balance due of approximately 21.6 bitcoin. Pursuant to the terms of the Restructuring Agreement, the Company entered
into First Amendment of the Loan Agreement which amended the terms of the Bitcoin Agreement. The new amended terms included the extension
of the maturity date to May 31, 2022, mandatory weekly payments of $35,000 in Bitcoin and a grant of first priority security interest
in all property described in that certain Security Agreement entered into at the same time. In addition, the First Amendment to the Loan
Agreement provided for conversion of the note into U.S. dollars any time after June 30, 2021, if the market price of one bitcoin equals
to or exceeds $75,000.

 

See also Description of Capital Stock, page 69.

 

In November 2018, the Company entered into another
agreement with Mr. Komaransky. This agreement provides for up to four additional borrowings at 50 bitcoin increments with an initial term
of 90 days for each loan. Fees for these borrowings is the greater of 10% of the outstanding principal or 0.4% of total ATM sales. The
Company borrowed 50 bitcoin under this agreement in November 2018 and an additional 50 bitcoin in March 2019. The Company repaid these
Bitcoin borrowings in the year ended December 31, 2020.

 

 

 

 

SAFT Investments

 

In 2018, Athena Bitcoin issued a series of instruments
called “Simple Agreements for Future Tokens” (“SAFTs”) in exchange for investments in cash or crypto assets. The
SAFTs entitle holders to receipt of tokens representing equity in the Athena Bitcoin. under certain pre-defined circumstances. These include
a qualified financing event in which the Company raises $15 million or more in a single transaction, a “corporate transaction”
(which definition includes a sale of all or substantially all of the Company’s assets), or a dissolution. Athena Bitcoin may also
elect to issue equity in lieu of tokens in settlement of the SAFTs. In January 2020, Athena Bitcoin issued 1,653,425,404 shares of common
stock for the full outstanding SAFT balance of $5,434,819 since the Share Exchange transaction between GamePlan and Athena qualified as
a corporate transaction, based upon the conversion price of $4.09 per share implied by the valuation of the Company as of the date of
SAFT determined in good faith by the Board of Directors of Athena Bitcoin and the capitalization of Athena Bitcoin immediately prior to
the “corporate transaction” (see also “
Background and Corporate History” above).

 

Buying and Selling Crypto

 

We are a provider of Bitcoin, Ethereum, Litecoin,
and BCH through automated kiosk machines, which we refer to as our ATMs, in the United States and Latin America, integrating one-stop
convenience with expert-level customer service. We were one of the first companies to introduce Bitcoin ATMs into the United States,
Colombia, Argentina, and El Salvador. We are committed to serving retail purchasers of digital assets with the highest level of customer
care through a broad product selection, trained customer service staff, multi-lingual support, and convenient locations. We seek to address
the consumer who prefers to transact in cash for digital assets such as Bitcoin, bypassing the traditional means of access to the financial
system. Our varied selection of crypto assets includes Bitcoin, Ethereum, Litecoin and BCH. As of December 31, 2021, we operated 186
Athena Bitcoin ATMs in the United States and 32 in Argentina, Colombia, and El Salvador.

 

Our Athena Investor Services (“AIS”)
group allows us to assist digital asset buyers and sellers who wish to use their bank accounts. This service caters to investors who are
making larger purchases of Bitcoin in exchange for wire transfers from their bank accounts. These customers are often looking for the
same crypto assets that we sell at our Athena Bitcoin ATMs but sometimes challenge us with finding a less well-known coin. In such
cases where we do not have such a crypto asset in our possession, we first acquire the crypto asset and then subsequently make the sale
to the customer. We earn their business through education, service, and quality execution of their transaction. The Company has changed
the name of its over-the-counter service to Athena Crypto Exchange (“ACE”).

 

The retail digital asset space is crowded with
large digital players including Coinbase, Square, Gemini, and PayPal. The Company focuses on the cash buyer, who needs bitcoin in the
here and now. To serve our customers, we follow AML and KYC guidelines appropriate for BSA compliance. The Company’s operating unit, Athena
Bitcoin, Inc., is FinCEN registered and undergoes an annual Compliance and Financial audit to maintain good standing. We also comply with
state regulations and reporting in each state where it is required.

 

Our objective is to become one of the world’s
leading retailers of Bitcoin through cash exchange kiosks. Key elements of our strategy include:

 

  · International expansion in Latin America where we have a foothold;
     
  · Machine count growth;
     
  · Tailoring site selection to our target market.

 

 

 

Wide User Base

 

We serve a wide user base including people buying
Bitcoin for the first time; small businesses buying Bitcoin to make global payments; Bitcoin owners needing weekend spending cash; and
people that have no bank or savings accounts. While many people are interested in Bitcoin for potential investment profits, Athena believes
the great promise of Bitcoin is something wholly different – the democratization of money. A key aspect of the rationale behind Bitcoin
is that the traditional system of money and banking, with its many layers, costs and inefficiencies, results in the disenfranchisement
of enormous numbers. This includes the world’s people of modest means, as well as the world’s small businesses.

 

There are over 30 million small businesses in
the United States, according to the Small Business Administration, while there are several times that amount worldwide. Today, the Internet
has enabled global communications with real-time translation of languages and business connections, that were next to impossible thirty
years ago. For those small businesses to transact with each other, they no longer need to speak a common language; however, they do need
a common currency. They need money native to the Internet. Bitcoin is the first widespread form of Internet native money. There are 1.7
billion people in the world without bank accounts, according to a 2017 report from the World Bank. This condition includes large segments
of people in wealthy countries including the United States. There are 7.1 million U.S. families with no bank account according to a 2019
FDIC report. In 2017, the FDIC did a study on a segment of the U.S. population referred to as “underbanked,” which they define
as households that have a bank account but opt to use check cashing services, payday loans, and other non-bank services. The FDIC estimated
the underbanked population in the U.S. to include 48.9 million adults and 15.4 million children. The survey reported that more than half
of the underbanked households said they did not have enough cash to keep in a bank account. Another 30% said they did not trust the system
and 9% said the banks were in inconvenient locations.

 

Crypto assets are often used as stores of value
by underbanked and unbanked people all over the world. Countless banked, unbanked, and underbanked people with relatives in other countries
use Bitcoin and other crypto assets for sending funds to loved ones. Crypto assets also enable citizens in countries with high inflation
and depreciating fiat currencies to keep their money in alternate forms such as stable coins or other digital tokens; thus, protecting
vulnerable populations from significant loss in the value of their money. Athena Bitcoin ATMs are widely used by small businesses to make
global payments.

 

For big companies that perform million-dollar transactions, the wire
fees and currency conversion costs are a modest percentage of the total transaction. For small transactions (i.e., $1,000), these fees
are significant. A small business seeking to pay $2,000 for this month’s order of birdfeeders from a small Asian factory will incur
high fees when using the traditional money and banking system. One of our first customers in Ohio taught us this lesson when he explained
why he needed Bitcoin quickly to secure a discount with a supplier around the other side of the world.

 

 

 

 

 

Products and Services

 

Sales of Bitcoin and Crypto Assets at
Bitcoin ATM

 

 

The primary business activity of the Company
is the purchase and sale of Bitcoin, Ethereum, Litecoin, and BCH through our Bitcoin ATMs —which are free standing kiosks
that allow customers to exchange their physical currency for crypto assets. Customers can buy crypto assets or sell crypto assets using
Athena Bitcoin ATMs – either spending or receiving physical currency (cash). We do not charge transaction fees but rather make a spread
on the price of the crypto asset. The typical Bitcoin ATM that the Company uses is about 5-feet tall and features a large touchscreen
for customer interaction. The ATMs are capable of both buying and selling multitude of crypto assets, but most transactions of the Company
are for Bitcoin.

 

Customers can purchase as little as $1 of Bitcoin,
but typically choose between $100 and $1,000. The Company charges a fee per bitcoin equal to the prevailing price at U.S. crypto-based
exchanges plus a mark up that typically varies between 5% and 20%. The Company recognizes revenue when performance obligations identified
under the terms of service with its customers are satisfied. The Company’s revenue associated with ATM transactions are recognized
at a point in time when the digital asset is delivered to the customer. The Company controls the service as it is primarily responsible
for fulfilling the service and has discretion in establishing pricing with its customers.

 

Our Bitcoin ATMs do not contain any crypto assets
or keys to crypto assets. We sell crypto assets from cloud-based wallets in each country, enabling real-time supply of crypto assets to
our customers. We buy the majority of our crypto assets through automated purchases on crypto exchanges, based on algorithms we have developed
for balancing our holdings with anticipated demand. We do not seek to hold excess quantity of any crypto asset.

 

 

 

 

Our hot wallets are maintained by the staff
of the Company. Access is limited to as few persons as is necessary to maintain their proper functionality. At this time, the Company
does not maintain any balance of crypto asset in cold storage. The crypto assets the Company holds are available for immediate sale.
We do not have any insurance policies that cover the crypto assets held in our wallets.

 

A perfect match between supply and demand can
never be achieved as demand is generally predictable but not exact, and there are often demand spikes due to Bitcoin price movements.
For example, if a big winter storm hits a large territory on a given weekend, less people than normal will visit our Bitcoin ATM locations
and we may end up with excess holdings. If we ever fail to fully anticipate a spike in demand or if our buying turned out to be short
for any reason, our users may not be able to purchase crypto assets from our Bitcoin ATMs. This is something we strive to minimize; thus,
we try to err on the side of having a slight excess of crypto holdings.

 

ATM Operations

 

Suppliers of our ATMs

 

As of December 31, 2021, 176 of our Athena
Bitcoin ATMs and their software systems, which include advanced security protections, are sold to us by Genesis Coin, Inc. (“Genesis
Coin”), a major supplier of Bitcoin ATMs. We supplement these protections with our own added risk management methods. The Genesis
Coin machines have a good track record for stability. We have worked with the company for many years and were among its first customers,
and we continue to be impressed with the Genesis Coin hardware and software. To this date, our ATMs have only accepted a negligible number
of counterfeit bills. For our white label service in El Salvador, we are operating and managing a mix of ATMs supplied by Genesis Coin
as well as General Bytes s.r.o., and Bitaccess Inc., two other suppliers of Bitcoin ATMs.  

 

Agreement with Genesis Coin, Inc.

 

We currently do not have a written contract for
purchase and sale of ATMs with Genesis Coin. We have been operating based on our working relationship and the terms of the original purchase
and sale contract with Genesis Coin, which we entered into on October 1, 2015. Although said contract was terminated when the equipment
described therein was delivered and paid for, we continue to honor bilaterally, the terms of said contract in our ongoing business relationship.
While the purchase price and delivery of each order of ATM machines is subject to negotiation and prevailing market conditions, we follow
the terms agreed to in the 2015 contract, which include the agreement that: the software license we receive is limited and non-exclusive
and/or sublicense; we pay to Genesis Coin or nominee a software license fee of one percent (1%) of the value of all transactions processed
by us (such fees are assessed in Bitcoin, deducted automatically and transferred automatically to Genesis Coin or nominee); the term of
license granted by Genesis Coin commences at delivery of equipment and continues as long as we retain legal right and title to operate
the ATMs purchased from Genesis Coin; and Genesis Coin provides us with the one year limited parts warranty for the ATM kiosks we purchase.

 

Rental Agreements for our ATMs

 

We pay rent to the establishments where we place
our ATMs. Our rental agreements are for one year, three years, five years, or less than one year with auto renewal and we are typically
free to move our ATMs from sites that are not performing to our objectives, at minor cost. In addition to rent, we also pay for internet
connection costs and cash logistics (handling) costs.

 

Technical Support for our ATMs

 

Our ATMs can experience down-time due to internet
connection failures as well as technical problems. For technical problems like a frozen screen, our tech support team can typically reboot
the machine remotely. In other cases, we may have to contact a local technician to repair the machine. In some rare cases, we may have
to fly one of our team members to the location to fix the problem.

 

 

 

Global Cash Logistics

 

A significant operational aspect of our business
involves collecting physical fiat currencies from our Bitcoin ATM fleet and getting them safely deposited into our bank account. The collection
and deposit of the physical currencies received in our ATMs is a multi-step process. We do not directly handle the currency operations.
This function is contracted to bonded security companies that have armored vehicles and cash storage vaults in many locations.

 

For logistic efficiency, it is impractical to
retrieve cash from one machine and go directly to a bank branch. Rather the cash from all our machines in a city is collected by contracted
armored vehicle companies on a periodic basis, and brought to their regional centers where it is counted, inventoried, and grouped with
cash coming from our ATMs in other cities.

 

We actively oversee this process in conjunction
with our cash logistics contractors to adjust for factors like three-day weekends and unanticipated surges. While we can manage the crypto
side of our business with real-time tracking, the current time period from retrieving cash from our ATMs to having the funds available
in our bank account is about eight (8) days. In our early years, the time period was close to twenty-one (21) days. This time period directly
impacts our working capital and our ability to buy more crypto assets; thus, we strive to keep it as short as possible.

 

Just as shortages of crypto assets can temporarily
prevent us from selling crypto assets to our customers, our ATMs running out of cash or becoming fully loaded with cash (and unable to
take more bills) can impede our users from completing certain transactions until our cash logistics contractors fix the issue at their
next visit to our ATMs. Our business has variable demand, and it is unavoidable that some machines will at times run out of cash or become
fully loaded with cash (and unable to take more bills) for a time period.

 

Sales of Bitcoin and Crypto Assets by Telephone

 

For transactions larger than is practicable at
our Athena Bitcoin ATMs, we offer select clients the ability to transact with us via telephone. This service is offered under the name
Athena Investor Services (“AIS”). Through this service, clients can buy and sell a wide variety of crypto assets through a
direct transaction and will complete their purchases by wiring funds directly from their bank accounts. In like manner we may buy a private
party’s crypto assets. The Company is in the process of changing the name of its over-the-counter service to Athena Crypto Exchange
(“ACE”).

 

Purchases or sales of crypto assets of $10,000
or more are made by agreement and closed with the parties exchanging a bank wire for crypto assets on the same day. This business currently
constitutes about 20% percent of our overall sales by revenue, with an average transaction size of $76,000 in the twelve months’
period ended December 31, 2021 As the transaction sizes are larger for this business area, our mark ups are smaller than transactions
using our ATMs. As of the date of this prospectus, we do not transact in any crypto assets except Bitcoin, Ethereum, Tether, Litecoin,
and BCH. We will update this prospectus if we decide to transact in other crypto assets. Such a change would only happen if there were
significant customer demand for a specific crypto asset and that crypto asset was available to us through multiple trading partners,
digital asset exchanges, and digital asset brokers.

 

Peer-to-Peer Exchange Services via BitQuick.co

 

In 2016, Athena Bitcoin purchased the assets
of BitQuick Technologies including the peer-to-peer exchange at BitQuick.co. The services offered by BitQuick include the ability of
sellers of Bitcoin, and only Bitcoin, to list for sale their Bitcoin and receive cash deposits into their bank accounts. BitQuick
will verify that the deposit has been made and upon satisfaction of the terms of the sale, release the Bitcoin, which are held in escrow
by the Company using a non-custodial multi-signature wallet during the processing of the transaction, to the buyer. BitQuick takes
a percentage of the purchase as its fee for facilitating the transaction. On most transactions, this fee is 2% except when we split this
fee with other website operators who have directed internet traffic to BitQuick. Through our “affiliate program” we pay website
operators a portion of our fees when links from their websites result in transactions. The overall BitQuick business has faced significant
headwinds in recent years as banks have restricted the ability of non-account holders to deposit cash into accounts they do not control.
This has led to a decline in the ability of BitQuick buyers to deposit cash into BitQuick sellers’ accounts. As these policies
are determined solely by each bank and not publicly discussed, we cannot say why these restrictions have been enacted nor if they will
ever be lifted. As of the date of this prospectus, we have no plans to support additional crypto assets besides Bitcoin. For the fiscal
year ended December 31, 2021 total revenue from BitQuick was $40,000 while revenue from BitQuick was $90,000 for the fiscal year ended
December 31, 2020. The Company has closed this business down.

 

 

 

Expansion of Business Operations in El Salvador

 

Overview

 

On June 8, 2021, the Bitcoin Law, proposed by
President of El Salvador, Nayib Bukele, was passed by the Legislative Assembly of El Salvador giving Bitcoin the status of legal tender
within El Salvador. Under this law, effective as of September 7, 2021, Salvadorans can pay taxes in Bitcoin and businesses will be obliged
to accept Bitcoin as payment for goods and services. The U.S. dollar will continue to circulate alongside Bitcoin as the national
currency and legally recognized tender. When Salvadorans convert their Bitcoin to dollars within the Chivo digital wallet, they do not
receive dollars in the digital wallet in the same sense as having a dollar balance with a chartered bank. Instead, they become holders
of dollar obligations as represented by a dollar balance within the Chivo digital wallet, which are only a claim to real dollars. At
that point, Salvadorans hold an asset backed by Chivo S.A. de C. V., which according to news reports is not a chartered bank, and the
full faith and credit of Mr. Bukele’s government. According to news reports, the government spent up to $120 million to supply
$30 worth of Bitcoin into each Chivo wallet, the country’s new official Bitcoin wallet application. That funding would cover the
cost of providing 4 million citizens with Bitcoin in a country of 6.5 million. The government created a $150 million fund to support
Bitcoin to U.S. dollar conversions and began implementation of Chivo ATMs to give citizens access to paper-currency in exchange for their
Bitcoin and U.S. dollar balances held in their Chivo digital wallets..

 

El Salvador ranks third to last among its regional
peers in terms of banking access. Since approximately 70% of the adult population of El Salvador does not have access to the traditional
banking system, Bitcoin/digital wallets can serve as a savings instrument, promote financial inclusion and democratize access to electronic
payments. Currently, there are already 161 mobile subscriptions per 100 inhabitants in El Salvador, and it is likely easier to provide
financial services linked to cellphones than trying to open new bank accounts. Bitcoin legalization could lower the cost of paying and
receiving money. According to President Bukele, Bitcoin, which is easy to send across borders, will greatly reduce remittance fees. In
El Salvador, remittances accounted for more than 20% GDP in 2020. On a global basis, according to the World Bank’s Remittance Prices
Worldwide (March 2021), sending remittances costs an average of 6.38% of the amount sent, but can reach more than 10% for small transactions.
The high cost of remittances means that El Salvador loses more than 1% of GDP on remittances fees. The Chivo digital wallet also allows
Salvadorans in the U.S. to send money home without incurring remittance fees. Since the implementation of the Bitcoin Law, many Bitcoin
enthusiasts around the world have shown interest in moving to the country, where their Bitcoin trading profits would be tax-exempt and
where tax rates are relatively low. El Salvador is offering permanent residency to anyone who invests at least three Bitcoins (about $160,000)
in the country. Legalization of Bitcoin could attract investment of both crypto asset investors and miners, and could generate additional
tourism.

 

Business Operations

 

Since June 2021, when the Bitcoin Law was enacted,
the Company has focused its resources and expanded its operations in El Salvador. The Company’s operating subsidiary in El Salvador
is Athena Holdings El Salvador, S.A. de C.V.; however, our agreements with the government of El Salvador discussed below, have also been
entered with Athena Bitcoin Global, a Nevada corporation and Athena Bitcoin, Inc., a Delaware corporation, our wholly-owned operating
subsidiary. We began discussions with the government of El Salvador in late June 2021, and successfully executed agreements with the
Department of Treasury (Ministerio de Hacienda) in August, 2021. Under those agreements, the Company is responsible for several major
projects, which include the operation of 200 Chivo Bitcoin ATMs in El Salvador,10 Chivo Bitcoin ATMs at El Salvador consulates in the
U.S. (in the states of California, Florida, Georgia, Illinois, and Texas), 45 Chivo Bitcoin ATMs in other U.S. locations, and the
delivery to the government of El Salvador 950 Chivo point-of-sale (“POS”) terminals for local businesses in El Salvador to
process transactions with Bitcoin. Additionally, we develop and maintain a Bitcoin platform (“Chivo Ecosystem”) designed
to support the Chivo digital wallet.

 

For operating 200 Bitcoin ATMs the Company
was paid a one-time non-refundable installation fee and will recognize recurring monthly service fees for maintaining the machines. The
Department of Treasury of El Salvador paid us the agreed price per contract for each POS terminal delivered in 2021. We are also charging
a monthly fee to maintain Chivo Bitcoin ATMs in the U.S. for each consulate and a transaction fee on all Bitcoin purchases made on those
ATMs . The agreement terms vary by project from one year to three years with monthly or annual renewal terms. Currently, we do not
face any direct competition for the services we provide since we are operating under contract with El Salvador’s Treasury department.
The Treasury department owns all intellectual property developed for the Chivo Ecosystem and has granted Athena a royalty-free, fully
paid up, perpetual worldwide right and license to use for any purpose.

 

 

 

 

Contracts with the Government
of El Salvador

 

In the third quarter of 2021, the Company signed
several contracts with the Department of Treasury (Ministerio de Hacienda) of El Salvador (“El Salvador Contracts”) which
include installing and operating 200 Chivo Bitcoin ATMs in El Salvador, 10 Chivo Bitcoin ATMs at El Salvador consulates in the U.S., 45
Chivo Bitcoin ATMs in other U.S. locations, and sales of 950 point-of-sale (POS) terminals for local businesses in El Salvador to process
transactions with Bitcoin. Additionally, the Company will sell intellectual property in software, and develop and maintain a Bitcoin platform
designed to support a branded digital wallet, as specified in El Salvador Contracts. See also [Note * ].

 

Letter of Intent with Vakano Industries

 

The Company entered into a non-binding Letter
of Intent with Arley Lozano, a principal beneficial owner of Vakano Industries and XPay, both Colombian entities (collectively, “XPay”),
for the purchase and sale of certain assets of XPay, primarily intellectual property assets, including the XPay Wallet (the precursor
to the Chivo Wallet) and XPay POS software, to the Company. In September, 2021, Lozano and the Company entered into a letter of intent
to acquire assets of XPay which include certain technologies, ATMs, point-of-sale terminals in El Salvador, X-Pay POS system and
other assets. The total purchase price is comprised of $3 million in cash and the issuance of 270 million of the Company’s shares
of common stock (valued at $27 million at a $0.10 per share valuation). The shares are subject to vesting over a three-year period based
on the consulting services related to the management of Colombian operations to be provided by Mr. Lozano and additional five-year non-competition
and non-solicitation clause. The shares shall vest on one year cliffs and then linearly thereafter. The definitive agreement for the
purchase and sale of XPay assets has not been executed yet, however, the Company paid an initial deposit of $780,000 to XPay as a partial
payment towards the purchase price of $3,000,000 for XPay assets. The initial payment was accepted and agreed to by XPay on September
9, 2021 in a written confirmation which included a specific list of assets to be acquired by the Company. See also, Note 13 to the unaudited
financial statements of the Company for the nine months’ period ended September 30, 2021. The Company expects the acquisition
to be finalized in the fourth quarter of 2022.

 

Loan from Banco Hipotecario

 

In September 2021, the Company’s El Salvador
subsidiary, Athena Holdings El Salvador, S.A. DE C.V. (“Athena El Salvador”) entered into a loan agreement with Banco Hipotecario
for the loan amount of $1,500,000. The loan has an interest rate of 7.5% and is secured by Athena El Salvador’s assets in El Salvador.
The maturity date is 36 months after the disbursement of the funds. The monthly payments on the loan in the equal amounts of $49,108,
begin two (2) months after the disbursement of the funds. The current balance as of December 31, 2021 is $1,500,000. The Company
intends to utilize loan proceeds to expand its fleet of Bitcoin ATMs and for other general corporate purposes. See also Note 8 (“Debt”)
to the unaudited financial statements for the twelve months ended December 31, 2021.

 

Athena Ruru

 

In November 2021, the Company began marketing
its services under a service branded “Athena Ruru”. Athena Ruru includes three services the Company offers: Bitcoin ATMs,
point of sale (POS) terminals and merchant services, and the wallet solution. The Company believes that by defining those services as
a complete product, it could facilitate the combined use of digital currency and electronic banking to power economies in need of access
and inclusion to enable them to grow their GDP, such as the economy of El Salvador. As a payment system, it provides a mobile wallet which
allows users to access both crypto assets and fiat balances, exchange between those assets, send and receive money, pay for goods and
services, and deposit and withdraw funds to local bank accounts and international crypto asset platforms. The target market for the combined
product offering includes other government entities, regional banks, and other trusted institutions that want to provide their constituencies
with access to a wallet integrated into an ATM and merchant network.

 

Environmental Impact

 

El Salvador’s Bitcoin plan has put a spotlight
on the environmental impact of cryptocurrency with the World Bank flagging such potential adverse effects among its concerns. Mining digital
currency requires large amounts of energy, and the Bitcoin industry’s global CO2 emissions have risen to 60 million tons, equal to the
exhaust from about 9 million cars, according to Bank of America’s report in March 2021. President Bukele sought to counter sustainability
concerns by engaging state-owned geothermal electric company, LaGeo SA de CV to offer Bitcoin mining facilities using renewable energy
from the country’s volcanoes.

 

 

 

Marketing

 

Our marketing consists of:

 

  · Trade shows,
  · Digital advertising on search engines, map sites, and industry-specific platforms,
  · Social media, and
  · SMS messaging.

 

Athena also maintains country-specific websites
that include information about how to access our service offerings as well as country-specific disclosures. Total advertising costs
amounted to $258,000 in 2021, and $151,000 in 2020.

 

Technology Research and Intellectual Property
Development

 

Athena licenses most of its technology from third
party vendors including the software that runs on our ATM kiosks. Our intellectual property (“IP”) includes proprietary algorithms
that we have developed. Some effort is devoted to automating a majority of our crypto purchases in a manner that helps us match supply
with anticipated demand. In addition, we have invested in building automated systems for customer onboarding including the collection
of required KYC documentation as well as government transaction reporting.

 

In 2020, technology costs were $702,000, and
for twelve months ended December 31, 2021, technology costs were $2,071,000. Athena has not filed for protection of our algorithms
and maintains them as private and proprietary business information. The IP we use for the security of our ATMs and transaction integrity
is mostly provided by vendors, although we have added additional layers and extra private security measures that are unique to the Company.

 

Athena Bitcoin has registered both its name and
distinctive owl logo with the United States Patent and Trademark Office. As of December 31, 2021, the registration is live with serial
number 90606452.

 

Competition

 

There are many different companies that enable
people and businesses to buy or sell Bitcoin and other crypto assets, including other operators of Bitcoin ATM networks, online services
and exchanges such as Coinbase and Gemini, and payment services such as Square and PayPal.

 

Our direct competition in the U.S. includes Coinstar,
a major corporation that today runs one of the largest kiosk networks in the U.S., as well as a variety of Bitcoin ATM network operators.
Coinstar is an existing operator of kiosks at major grocery chains that are used to exchange coinage for a variety of payment instruments
such as gift cards and in-store vouchers. In recent years, they have added the ability to use physical coins and cash bills to buy Bitcoin
on many of their kiosks, in partnership with Coinme. The other Bitcoin ATM network operators use machines similar to the Company’s
fleet of Bitcoin ATMs.

 

The financial performance of any Bitcoin ATM network
is influenced by several factors. We believe that site selection and branding have the biggest effect on per-ATM transaction volumes.
We are not aware of the operating performance of our competitors as they are private companies and do not provide any public financial
disclosures. From our years of experience in this industry, we believe the Company’s Bitcoin ATMs perform at or above industry averages.

 

While there are many other Bitcoin ATM operators,
we believe the industry is nascent and that worldwide tens of thousands of attractive locations remain untouched. While we recognize that
there is a terminal limit to the number of Bitcoin ATMs that the U.S. market can support, we believe that that limit has not yet been
reached and is expanding as Bitcoin and other crypto assets gain more widespread use. In South America, the Bitcoin ATM network is still
being developed and far from maturation.

 

 

 

 

Below is a partial list of US Bitcoin ATM networks
that operate in the regions where the Company also operates:

 

Company Name Units Website
Coinstar/Coinme 5607 https://www.coinstar.com/bitcoin
LocalCoin 399 https://localcoinatm.com/
Bitcoin Depot 332 https://bitcoindepot.com
Digital Mint 269 https://www.digitalmint.io/
Cryptospace 8 https://www.cryptospace.com

 

Outside of the US market, which is the largest,
the next highest concentration of Bitcoin ATMs is located in Eastern Europe. Below is a partial list of Bitcoin ATM networks outside the
US.

 

Company Name Units Website
24nonStop 6971 http://24nonstop.com.ua/
iBox 5071 https://www.ibox.ua/ru/map/
Bitcoin Romania and Zebrapay 1685 https://selfpay.ro/
Sweepay and Swiss Railways 1357 https://sweepay.ch/
CashTerminal 612 http://www.cashterminal.eu/en
Bitcoin Romania 74 https://bitcoinromania.ro
LoCoins 27 https://locoins.io/
Bitnovo 10 https://www.bitnovo.com

 

In the United States, we have a small percentage
of the total market, operating approximately 1% of ATMs according to one industry reporting service (https://coinatmradar.com). In Latin
America, we control a larger percentage of the total market, operating 21% of ATMs overall, and 89% in the countries where the Company
operates.

 

Apps like Robinhood, PayPal, and Cash App offer
customers a way to purchase crypto assets using their smartphones and funds from their bank accounts. These apps offer competitive pricing
relative to our ATMs; however, they do not accept physical currency and typically require users to connect their bank accounts.

 

Full-service exchanges like Coinbase Pro, Gemini,
and Kraken allow traders to make investments in a wide variety of crypto assets. These exchanges cater to active traders and the most
highly price sensitive consumers. The Company often uses such services for purchasing its crypto assets. Users from this segment of the
overall market rarely overlaps with the Bitcoin ATM industry.

 

Competitive Advantages

 

We believe we enjoy several competitive advantages.
We believe our foremost advantage is our many years of business experience combined with our insight into optimizing many interrelated
factors and aspects of the crypto business. This winning combination ultimately drive our bottom-line profits.

 

No two Bitcoin ATM networks are the same, they
will each have different results and a different bottom line. No two locations perform the same. Any company with sufficient capital
on hand can copy our ATM offerings and exchange rates, and place them in 10,000 locations before we can. They might also lose money.

 

Site selection is a very substantial factor in
overall performance. Many people think major shopping centers like Walmart would be an optimal location but in the U.S., we have found
otherwise. Our site selection methodology is a trade secret of our business. Our methodology is not easily uncovered as we have ATMs located
in rural, urban, and suburban areas. We have learned and refined our site selection methodology over the years, and we believe our expertise
in this area constitutes a material competitive advantage.

 

 

 

 

We believe our operational efficiencies provide
us with another competitive advantage. It took six years of significant efforts and achievements to grow the Company from start-up losses
all the way to steady profitability and to develop several proprietary approaches to manage our operations efficiently with respect to
all aspect of crypto transactions, risk management, and efficient cash handling spanning five countries. Operational efficiency is in
the same category of importance as site selection.

 

Unlike many competitors that focus on quickly
installing dozens or hundreds of ATMs, we prioritized getting to profitability on a global scale with a small base of ATMs. We focused
on developing and putting in place scalable systems and methods for managing a diverse global operation. When comparing Bitcoin ATMs to
other methods of transacting, the primary advantage of an ATM is its ability to complete a transaction from accepting payment to delivering
crypto assets quickly. The ATM will only accept physical currency, which is an immediate and permanent form of payment. This subsequently
facilitates the immediate delivery of crypto assets; also, an immediate and permanent form of transaction. Apps and services that rely
on ACH or other bank mechanisms for the fiat leg of a transaction often cannot deliver the crypto assets quickly because of the funding
mechanism is neither immediate nor permanent.

 

We also believe our branding gives us a competitive
advantage with many store owners. Large companies often have access to capital, but they have no heritage in the crypto space. Companies
that want to start a Bitcoin ATM network tomorrow can copy our offerings and hire top branding specialist, but what they can’t do
is create a brand that has roots to the early years of Bitcoin and Bitcoin ATMs. The bright orange on our Athena Bitcoin ATMs is the same
color as the orange in the original Bitcoin logo, helping our brand stand out and represent the spirit and essence of Bitcoin and the
entire crypto industry in any stores where our ATMs are placed.

 

While the end result of a transaction on one Bitcoin
ATM versus another may be similar, we believe that many store owners and customers looking for a Bitcoin ATM will often prefer an Athena
Bitcoin ATM versus, for example, a multipurpose Coinstar machine that can handle your loose change and also sell you Bitcoin. That is
our opinion from anecdotal feedback we have received over the years. We believe our branding and brand authenticity has been a contributing
factor to getting good performing sites, and that it will continue to be a big contributor to our future growth.

 

Competitive Disadvantages

 

Our competitive disadvantages are that we do not
yet have the operational and financial resources that some of our competitors have, which results in having fewer resources to deploy
new ATMs, develop fewer new markets, and invest in technology that could extend our service offerings, as compared to some of our competitors.
We intend to raise capital several times in the coming years to vastly expand our network, but we do not favor growth at all costs and
will continue to focus on bottom line performance and maintain our standards of careful site selection. This could result in slower sales
growth than would otherwise be possible.

 

Need for Government Approval of Principal Products and Services

 

Compliance with laws and regulations is a vital
part of our business. In the United States, there are several important federal laws and regulations aimed at preventing money-laundering
and terrorist financing that require specific record-keeping, filings, and other compliance procedures. In addition, there are laws and
regulations in state jurisdictions that also require permits, reporting, and other compliance and customer service procedures. Finally,
we are often contacted by federal, state, and local law enforcement agencies and subpoenaed for information on the activities of some
customers.

 

Federal Regulation

 

In the United States, the Department of the Treasury
through the Financial Crimes Enforcement Network (“FinCEN”) has primary authority over dealers in crypto assets. This was
established in 2013 when FinCEN released interpretive guidance to “clarify the applicability of the regulations implementing the
Bank Secrecy Act (“BSA”) to person creating, obtaining, distributing, exchanging, accepting, or transmitting virtual currencies”
(FIN-2013-G001). Since that time, all businesses that deal in crypto assets in the manner of the Company must register as a Money Service
Business (“MSB”) with FinCEN and comply with the requirements of the BSA, the Patriot Act, and other amendments and administrative
guidance issued by FinCEN and the Department of the Treasury.

 

 

 

 

We are subject to various anti-money laundering
and counter-terrorist financing laws, including the BSA in the United States, and similar laws and regulations abroad. In the United States,
as a money services business registered with FinCEN, the BSA requires us to among other things, develop, implement, and maintain a risk-based
anti-money laundering program, provide an anti-money laundering-related training program, report suspicious activities and transactions
to FinCEN, comply with certain reporting and recordkeeping requirements, and collect and maintain information about our customers. In
addition, the BSA requires us to comply with certain customer due diligence requirements as part of our anti-money laundering obligations,
including developing risk-based policies, procedures, and internal controls reasonably designed to verify a customer’s identity.
Many states and other countries impose similar and, in some cases, more stringent requirements related to anti-money laundering and counter-terrorist
financing. We have implemented a compliance program designed to prevent our platform from being used to facilitate money laundering, terrorist
financing, and other illicit activity in countries, or with persons or entities, included on designated lists promulgated by Office of
Foreign Assets Control (“OFAC”) and equivalent foreign authorities. Our compliance program includes policies, procedures,
reporting protocols, and internal controls, and is designed to address legal and regulatory requirements as well as to assist us in managing
risks associated with money laundering and terrorist financing. Anti-money laundering regulations are constantly evolving and vary from
jurisdiction-to-jurisdiction. We continuously monitor our compliance with anti-money laundering and counter-terrorist financing regulations
and industry standards and implement policies, procedures, and controls in light of the most current legal requirements.

 

Athena Bitcoin is registered with FinCEN and
has registration number 31000158527394. In addition, Athena Bitcoin has appointed Sam Nazarro as its Chief Compliance Officer, written
and distributed a BSA Compliance Policy, and engages an outside review firm to perform an annual review of its Compliance Policy.

 

State Regulation

 

Depending on the state where the Company places
a Bitcoin ATM, there are local laws and regulations with which the Company must comply to operate legally. These laws usually require
the Company to register with a state agency, provide a surety bond, and make regular reports about its activities in the state and its
financial health.

 

In some jurisdictions, the Company may be required
to obtain operating permits from the city or county. These typically involve the payment of registration fees.

 

Subpoenas and Other Law Enforcement Interactions

 

From time to time, the Company is subpoenaed for
its records and asked to testify in legal proceedings. These requests come from all branches of local, state, and federal law enforcement
agencies and are usually requests for information about our clients, their transactions, and other information that we have collected.
Our compliance team is charged with responding in a timely and accurate manner to these requests once the validity and legality of the
request has been determined.

 

Consumer Protection

 

The Federal Trade Commission (“FTC”),
the Consumer Financial Protection Bureau (“CFPB”), and other U.S. federal, state, and local and foreign regulatory agencies
regulate financial products, including money transfer services related to remittance or peer-to-peer transfers. These agencies, as well
as certain other governmental bodies, in particular state attorneys general, have broad consumer protection mandates and discretion in
enforcing consumer protection laws, including matters related to unfair or deceptive, and, in the case of the CFPB, abusive, acts or practices
(“UDAAPs”), and they promulgate, interpret, and enforce rules and regulations that affect our business. For example, all persons
offering or providing financial services or products to consumers in the United States, directly or indirectly, can be subject to enforcement
actions related to the prohibition of UDAAPs. The CFPB has enforcement authority to prevent an entity that offers or provides consumer
financial services or products or a service provider in the United States from committing or engaging in UDAAPs, including the ability
to engage in joint investigations with other agencies, issue subpoenas and civil investigative demands, conduct hearings and adjudication
proceedings, commence a civil action, grant relief (e.g., limit activities or functions; rescission of contracts), and refer matters for
criminal proceedings.

 

 

 

 

International Regulations

 

Outside of the United States, the countries where
the Company operates are members of an array of regional Anti-Money-Laundering (“AML”) treaty organizations. Specifically,
Argentina and Colombia are signatories to the Financial Action Task Force of Latin America (“GAFILAT”). Argentina is also
a member of Financial Action Task Force (“FATF”). El Salvador is a member of Caribbean Financial Action Task Force (“CFATF”).
The United States is a member of both FATF and Asia/Pacific Group on Money Laundering (“APG”). These relationships, both overlapping
and non-overlapping, result in legal interpretations, regulation, and enforcement that is heterogeneous. In each of these jurisdictions,
membership in one or more AML treaty organizations can influence the specific documentation, record keeping, and financial limits placed
on MSB, or dealers in crypto assets.

 

Employees

 

We strive to foster a productive and engaging
work environment. Our talent strategy is aligned with our business vision and platform strategy. We hire smart people with a passion for
crypto assets and the possibilities to empower our customers to achieve their financial and transactional goals.

 

As of December 31, 2021, we employed 12 people
in the United States, and through subsidiaries had 19 direct employees in foreign subsidiaries. We also engage temporary employees
and consultants. As of December 31, 2021, we had 16 direct employees and have engaged 2 independent contractors to support our El
Salvador operations . They are primarily responsible for customer support of the Bitcoin ATMs, the Chivo wallet and the Chivo POS
terminals. We continue to search for additional personnel as we grow our operations in El Salvador.

 

Properties

 

We lease approximately 4,000 square feet of space
across two office locations in Chicago and the surrounding suburbs pursuant to two leases that each expire in 2022. The monthly lease
payments are approximately $4,500. The Company has short-term storage, office, and warehousing contracts in Illinois and Florida for approximately
1,750 square feet. We maintain international offices or co-working facilities in Colombia and Argentina. In El Salvador, we lease approximately
4,000 square feet of office space in San Salvador under the lease which expires in September 2022. The monthly lease payments are approximately
$7,000. We believe we will be able to obtain additional space on commercially reasonable terms.

 

Legal Proceedings

 

 

On December 28, 2021, ROI Developers, Inc.,
doing business as Accruvia (“Accruvia”), filed a lawsuit against Athena Bitcoin, Inc., doing business as Athena Bitcoin Global
in the 96th Judicial District in Tarrant County, Texas. The case was removed from Tarrant County Court and is currently pending in the
U.S. District Court for the Northern District of Texas. Accruvia is a provider of software development and support services. The complaint
alleges failure to make payment for services performed for the Company and breach of contract. The plaintiff seeks monetary damages of
$250,000 or less, for compensation allegedly owed, reasonable attorneys’ fees and other relief as the court deems just and proper.
The Company believes that the lawsuit is without a merit and intends to vigorously defend the case.

 

On February 7, 2022, the Company filed a lawsuit
against Accruvia and Shaun Overton (“Overton”), Accruvia’s principal officer and shareholder, among others, in the Illinois
state court. The complaint alleges a breach of fiduciary duty, breach of contract, and intentional and tortious interference with the
Company’s business relationship with the government of El Salvador. On September 22, 2021, Accruvia and the Company signed a term
sheet agreement for the proposed acquisition of Accruvia’s assets (the “Term Sheet”). The terms of the acquisition were
subject to due diligence and closing on or about October 22, 2021. Overton also signed a confidentiality and non-disclosure agreement
(“NDA”) with the Company’s El Salvador subsidiary and began purporting to work for the Company and representing himself
as its Chief Technology Officer in El Salvador. The Term Sheet provided for an employment agreement with Overton upon the closing of the
acquisition, however, the transaction did not close and no definitive agreement was entered into. The Company’s complaint alleges
that Overton’s intent was to sabotage and harm the Company’s business relationship with El Salvador’s government and
to secure contract for Accruvia to provide its software and development services. The complaint further alleges that Overton violated
the NDA and confidentiality clause in the Term Sheet, and caused losses by attempting to implement inappropriate hiring practices. The
Company also seeks preliminary and permanent injunctive relief preventing Accruvia and Overton from disclosure of the Company’s
confidential information. The Company is seeking damages of up to $3 million.

 

 

 

 

MARKET FOR COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS

 

Market Information

 

Our common stock is quoted on the OTC Pink Market
operated by OTC Markets Group, Inc. under the symbol “ABIT”. Our common stock last traded at $0.92 on March 10, 2022.
The volume of shares of common stock traded was insignificant and therefore, does not represent a reliable indication of the fair
market value of these shares. The following table sets forth the high and low closing-bid quotations for our common stock as reported
on the OTC Pink Market for the periods indicated. These quotations reflect inter-dealer prices, without retail mark up, mark down or
commission and may not necessarily represent actual transactions. The OTC Markets Quotation System is a quotation service that display
real-time quotes, last-sale prices and volume information in over-the-counter equity securities. The market is limited for our stock
and any prices quoted may not be a reliable indication of the value of our shares of common stock. 

 

For the year ended December 31, 2020    High     Low  
First Quarter   $ 0.1000     $ 0.0290  
Second Quarter   $ 0.0810     $ 0.0350  
Third Quarter   $ 0.0450     $ 0.0405  
Fourth Quarter   $ 0.0505     $ 0.0150  

 

For the year ended December 31, 2021   High     Low  
First Quarter   $ 0.5500     $ 0.0466  
Second Quarter   $ 1.8400     $ 0.1200  
Third Quarter   $ 32.8500     $ 1.5000  
Fourth Quarter   $ 9.0000     $ 3.1900  

 

For the year ending December 31, 2022   High     Low  
First Quarter   $ 4.4000     $ 0.7500  

 

Holders of Record

 

As of March 10, 2022
and just prior this filing, we had 4,089,409,545 shares of our common stock issued and outstanding held by 152 shareholders of record.
The actual number of holders of our common stock is greater than this number of record holders, and includes stockholders who are beneficial
owners, but whose shares are held in street name by brokers or held by other nominees.

 

Dividends

 

We have not paid, nor declared any cash dividends
since our inception and do not intend to declare or pay any such dividends in the foreseeable future as we intend to retain any earnings
for use in our business. Any future determination to pay dividends will be at the discretion of our board of directors, subject to limitations
imposed by state law.

 

Securities Authorized for Issuance Under Equity Compensation
Plans

 

As of December 31, 2021, we did not have any equity compensation
plans. The Company’s 2021 Equity Compensation Plan was approved and adopted by the Board and the Company’s majority shareholders,
effective October 15, 2021. There are no securities authorized to be issued under the 2021 Equity Compensation Plan as of the date of
this prospectus, and no securities have been issued so far.

 

 

 

Description
of Capital Stock

 

The following description of our capital stock
is based upon our Amended and Restated Articles of Incorporation (the “Amended Articles”), our bylaws and applicable provisions
of law, in each case as currently in effect. This discussion does not purport to be complete and is qualified in its entirety by reference
to our Amended and Restated Articles of Incorporation, and our bylaws, copies of which are filed with the SEC as exhibits to the registration
statement of which this prospectus is a part.

 

Authorized Capital Stock

 

We are authorized to issue 4,409,605,000 shares
of common stock, par value $0.001 per share, and no shares of preferred stock. As of the date of this prospectus, there were 4,089,409,545
shares of common stock issued and outstanding. The outstanding shares of stock have been duly authorized and are fully paid and non-assessable.

 

Common Stock

 

The holders of common stock are entitled to
one vote per share on all matters submitted to a vote of shareholders, including the election of directors. There is no cumulative voting
in the election of directors. The holders of common stock are entitled to any dividends that may be declared by the board of directors
out of funds legally available for payment. Holders of common stock have no preemptive rights and have no right to convert their common
stock into any other securities.

 

Pursuant to the Company’s Amended Articles,
1,521,141,192 shares of the authorized shares of common stock has been designated as a separate series referred to as “Lead Investor
Common Stock”. 868,960,471 shares of the authorized shares of common stock has been designated as a separate series referred to
as “Key Holder Common Stock”. The remaining 2,609,898,337 shares of the authorized shares of our common stock are not designated
as a separate series and are not considered Lead Investor Common Stock or Key Holder Common Stock. The Lead Investor Common Stock holders
of record (and only for so long as such holders hold any Lead Investor Common Stock, exclusively and as a separate class), is entitled
to elect three (3) directors of the Company; and with respect of the Key Holder Common Stock, as long as such holders hold any Key Holder
Common Stock, and at all times while the issued and outstanding shares of Key Holder Common Stock represents ten percent (10.00%) or
more of the Corporation’s total issued and outstanding shares (subject to appropriate adjustment for any stock splits, stock dividends,
combinations, recapitalizations and the like) and all the original record holders of the Key Holder Common Stock are then providing services
to the Corporation as officers, employees or consultants, such holders, exclusively and as a separate class, is then entitled to elect
two (2) directors of the Corporation and no other holder of any undesignated shares of Common Stock has the right to elect any directors
of the Corporation.

 

The holders of our common stock are entitled to one vote per share
on all matters submitted to a vote of stockholders, and our Amended Articles do not provide for cumulative voting in the election of
directors. The holders of our common stock receive ratably any dividends declared by our Board out of funds legally available therefor.
In the event of our liquidation, dissolution, or winding-up, the holders of our common stock will be entitled to share ratably in all
assets remaining after payment of or provision for any liabilities.

 

Preferred Stock

 

We have not authorized any preferred stock
in our Amended Articles.

 

Warrants to Purchase Common Shares

 

The Company does not have any authorized warrants
to purchase its common stock.

 

The only outstanding warrants are in the Company’s
wholly-owned subsidiary, Athena Bitcoin. In 2017, Athena Bitcoin issued warrants to purchase 202,350 shares of Athena Bitcoin’s
common stock for $14,005 for a right to purchase common shares in Athena Bitcoin, priced at $2.00 to $3.00 per share, at an average exercise
price of $2.49 per share. There was no activity related to these warrants in 2019 and the warrants to purchase 202,350 shares of Athena
common stock remained outstanding on December 31, 2019 and were classified as equity. In January 2020, warrants to purchase 102,350 shares
of Athena Bitcoin common stock at an average exercise price of $2.00 per share were exercised, some of them in a cashless manner, against
a lesser number of shares. As a result of the exercise of these warrants, the net issuance of Athena Bitcoin common stock was 93,106 shares
(exchanged into 115,888,490 shares of the Company’s common stock on January 31, 2020). The unexercised warrants to purchase 100,000
shares of Athena Bitcoin common stock, at an exercise price of $3 per share, remain outstanding as of December 31, 2020. The warrant will
expire on May 30, 2025.

 

 

 

 

Anti-takeover Effects of Nevada Law

 

We may currently be subject to the provisions
of the Nevada Revised Statutes regarding the acquisition of controlling interest (the “Controlling Interest Law”). A corporation
is subject to the Controlling Interest Law if it has more than 200 stockholders of record, at least 100 of whom are residents of Nevada,
and if the corporation does business in Nevada, directly or through an affiliated corporation. The Controlling Interest Law may have
the effect of discouraging corporate takeovers. As of December 31, 2021, we had [●] stockholders of record who are residents
of Nevada.

 

The Controlling Interest Law focuses on the
acquisition of a “controlling interest,” which means the ownership of outstanding voting shares that would be sufficient,
but for the operation of law, to enable the acquiring person to exercise the following proportions of the voting power of the corporation
in the election of directors: (1) one-fifth or more but less than one-third; (2) one-third or more but less than a majority; or (3) a
majority or more. The ability to exercise this voting power may be direct or indirect, as well as individual or in association with others.

 

The effect of the Controlling Interest Law
is that an acquiring person, and those acting in association with such person, will obtain only such voting rights in the controlling
interest as are conferred by a resolution of (1) a majority of the stockholders of the corporation and, if applicable (2) a majority
of each class or series of outstanding shares of which the acquisition would adversely affect or alter a preference or relative or other
right, approved at a special or annual stockholders’ meeting. The Controlling Interest Law contemplates that voting rights will
be considered only once by the other stockholders. Thus, there is no authority to take away voting rights from the control shares of
an acquiring person once those rights have been approved in accordance with the Controlling Interest Law. However, if the stockholders
do not grant voting rights to the shares acquired by an acquiring person, those shares do not become permanent non-voting shares. The
acquiring person is free to sell the shares to others, and so long as the subsequent buyer or buyers of those shares themselves do not
acquire a controlling interest, those shares would not be governed by the Controlling Interest Law.

 

If control shares are accorded full voting
rights and the acquiring person has acquired control shares with a majority or more of the voting power, a stockholder of record, other
than the acquiring person, who did not vote in favor of approval of voting rights, is entitled to dissent to the acquisition and demand
fair value for such stockholder’s shares pursuant to applicable provisions of Chapter 92 of the Nevada Revised Statutes governing
rights and procedures for dissenting stockholders.

 

In addition to the Controlling Interest Law,
Nevada has a business combination law, which prohibits certain business combinations between Nevada publicly traded corporations and
any “interested stockholder” for two years after the interested stockholder first becomes an interested stockholder, unless
the board of directors of the corporation approved the combination before the person became an interested stockholder or the corporation’s
board of directors approves the transaction and at least 60% of the corporation’s disinterested stockholders approve the combination
at an annual or special meeting thereof. For purposes of Nevada law, an interested stockholder is any person who is: (a) the beneficial
owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of the corporation, or (b) an affiliate
or associate of the corporation and at any time within the previous two years was the beneficial owner, directly or indirectly, of 10%
or more of the voting power of the then-outstanding shares of the corporation. The definition of “combination” contained
in the statute is sufficiently broad to cover virtually any kind of transaction that would allow a potential acquirer to use the corporation’s
assets to finance the acquisition or otherwise to benefit its own interests rather than the interests of the corporation and its other
stockholders.

 

The effect of Nevada’s business combination
law is to potentially discourage parties interested in taking control of the Company from doing so if they cannot obtain the approval
of our Board or stockholders.

 

In addition, under Nevada law directors may
be removed only by the vote of stockholders representing not less than two-thirds of the voting power of the issued and outstanding stock
entitled to vote, which could also have an anti-takeover effect.

 

Dividends

 

We have not paid any cash dividends on our
common stock to date and do not intend to pay cash dividends. The payment of cash dividends in the future will be dependent upon our
revenues and earnings, if any, capital requirements and general financial condition. The payment of any cash dividends will be within
the discretion of our board of directors at such time. In addition, our board of directors is not currently contemplating and does not
anticipate declaring any stock dividends in the foreseeable future.

 

 

 

 

Convertible Debentures

 

6% Convertible Debentures

 

On June 22, 2021, the Company commenced its private
offering of up to $5,000,000 of 6% Convertible Debentures to accredited investors only. The maturity date on the 6% Convertible Debentures
is two years after the date of issuance. The investor has an option to convert the principal amount of the Debenture into shares of common
stock of the Company at a conversion price equal to the lesser of (i) $0.10 or (ii) 25% less than the twenty trading day (20-trading
day) volume weighted average price (“VWAP”) of the common stock based on the closing prices per share reported on the OTC
Pink Market operated by the OTC Markets Group, Inc., for said twenty-day trading period, commencing ten-trading days prior to the date
of election to convert the Debenture and ending ten-trading days after such election is made and the notice of conversion has been submitted
to the Company. The accrued interest is not convertible and is payable quarterly. The investor is required to convert the Debenture if
the Company’s common stock is admitted for trading on a national stock exchange or if certain corporate transactions occur, such
as merger, sale or change of control of the Company. The holders of the Debentures are provided with the registration rights to register
the shares of common stock the Debentures are convertible into, in a registration statement to be filed by the Company on Form S-1 with
the SEC. The Company sold a total of $4,985,000 of the 6% Convertible Debentures to 77 accredited investors. The Company closed its private
placement in September, 2021. As of March 31, 2022, the Company issued 34,650,000 shares of its common stock upon conversion of $3,465,000
principal amount of the 6% Convertible Debentures.

 

8% Convertible Debentures

 

On January 31, 2020, we issued 8% Convertible
Debentures in the total principal amount of $3,125,000 to two (2) accredited investors pursuant to that certain securities purchase agreement
as of the same date, which has been amended in connection with the Company’s Loan Restructuring and Related Amendments Agreement
entered into as of July 12, 2021 (the “Restructuring Agreement”). The holders of the Convertible Debentures have the right
to convert their principal amount and any unpaid accrued interest into 260,416,667 shares of common stock based on the conversion price
equal to dividing the total amount of principal and accrued interest, if any, of the Debenture by the lesser of $0.012 per share or at
a 20% discount to a next equity financing, subject to certain limitations requiring the consent of the lead investor. The holders of
the Convertible Debentures are also subject to the mandatory conversion (except for the lead investor whose consent is required) at the
next equity financing. Next equity financing has been defined in the securities purchase agreement between the respective holders and
the Company as the next sale (or series of related sales) by the Company of additional equity securities under an exemption from registration
available under the rules promulgated under the Securities Act, from which the Company receives gross proceeds of not less than US$3,000,000.00
(excluding, the aggregate principal amount of the Convertible Debentures) The maturity date for the Convertible Debentures is January
31, 2025. The Convertible Debentures are unsecured obligations of the Company. The holders of Convertible Debenture have certain registration
rights as described below (the “Registration Rights”). The holder of 8% Convertible Debenture in the principal amount
of $125,000, Swingbridge Crypto III LLC, converted the principal amount and accrued interest of its 8% Convertible Debenture into 10,416,666
shares of common stock in February, 2022 at the conversion price of $0.012 per share.

 

Registration Rights

 

We are party to an Investors’ Rights Agreement
dated as of January 31, 2020 which was entered into in connection with the Company’s issuance of Convertible Debentures with lead
investor and certain key holders as defined in the Investors Rights Agreement, which grants them certain registration rights with respect
to our common stock. The registration of shares of our common stock pursuant to the exercise of registration rights described below would
enable holders to sell these shares without restriction under the Securities Act when the registration statement is declared effective.
We will pay all expenses related to any demand, piggyback, or Form S-3 registration described below, with the exception of underwriting
discounts and commissions.

  

Demand Registration Rights

 

At any time beginning 180 days after the effective
date of the registration statement of which this prospectus forms a part or five (5) years after the date of the Investors’ Rights
Agreement, the holders of 30% or more of at least 30% of the registrable securities then outstanding (or a lesser percent if the anticipated
aggregate offering price, net of underwriting discounts and commissions would exceed $15 million) may make a written request that we register
all or a portion of their shares, subject to certain specified exceptions. The holders of shares having registration rights are entitled
to written notice from the Company. We will prepare and file a registration statement as requested, unless, in the good faith judgment
of our Board, such registration would be seriously detrimental to the Company and its stockholders and filing should be deferred. We may
defer only once in any 12-month period, and such deferral shall not exceed 120 days after receipt of the request. In addition, we are
not obligated to effect more than two of these registrations within any 12-month period or if the holders’ proposed registered securities
may be immediately registered on Form S-3.

 

 

 

 

Piggyback Registration Rights

 

Subject to certain specified exceptions, if
we propose to register any of our securities under the Securities Act either for our own account or for the account of other stockholders,
the holders of shares having registration rights are entitled to written notice and certain “piggyback” registration rights
allowing them to include their shares in our registration statement. These registration rights are subject to specified conditions and
limitations, including the right of the underwriters, in their sole discretion, to limit the number of shares included in any such offering
under certain circumstances, but not below 30% of the total amount of securities included in such offering, unless (i) such offering
is the initial public offering or (ii) all other securities, other than our securities, are entirely excluded from the offering.

 

Form S-3 Registration Rights

 

At any time after we are qualified to file a
registration statement on Form S-3, and subject to limitations and conditions, the holders of 35% or more of the registrable securities
then outstanding are entitled to written notice of such registration and may make a written request that we prepare and file a registration
statement on Form S-3 under the Securities Act covering their shares, so long as the aggregate price to the public, net of the underwriters’
discounts and commissions, is at least $5,000,000. We will prepare and file the Form S-3 registration as requested, unless, in the good
faith judgment of our board of directors, such registration would be seriously detrimental to the Company and its stockholders
and filing should be deferred. We may defer only once in any 12-month period, and such deferral shall not exceed 90 days after receipt
of the request. In addition, we are not obligated to prepare or file any of these registration statements (i) within 180 days after
the effective date of a registration statement pursuant to demand or piggyback registration rights or (ii) if two of these registrations
have been completed within any 12-month period.

 

In accordance with the Investors’ Rights
Agreement, the Company delivered the required notice of a proposed filing in a timely manner, of the Company’s registration statement
on Form S-1 to the holders with the registration rights. The holders elected not to include in the registration statement any of the
common stock issuable upon the conversion of their respective Convertible Debentures.

 

Voting Agreements

 

The two largest individual shareholders have
entered into to a Voting Agreement as of January 31, 2020, in connection with the offering of the Convertible Debentures, pursuant to
which the lead investor (currently our largest shareholder, Mr. Komaransky) has a right to nominate three (3) directors
and the key holder (currently our CEO, director and second largest shareholder, Eric Gravengaard) has a right to nominate two (2) directors.
The Voting Agreement has been amended in connection with the Restructuring Agreement to provide that upon the Company’s repayment
in full of the amounts due and outstanding to the lead investor under the Convertible Debentures and that certain Loan Agreement for
30 bitcoin, entered into on August 22, 2018, and subsequently amended as of July 12, 2021, the lead investor will cause one of the three
designated persons on the Board of Directors to resign, and maintain the right to only designate two (2) directors instead of three (3),
and the resigning person shall be replaced by the mutually selected nominee by the lead investor and the key holder. The size of the
Board of Directors has been determined to be five (5) seats and can only be increased with the consent of the lead investor. The Voting
Agreement does not prohibit other shareholders from voting or grant any special voting rights to any shareholder. The parties to the
Voting Agreement further agree to vote to increase the authorized number of shares of common stock of the Company, if needed, to ensure
that there is a sufficient amount of shares available for conversion of the Convertible Debentures.

 

Right of First Refusal and Co-Sale Agreement

 

In connection with the offering of the Convertible
Debentures, Eric Gravengaard, the Company’s officer, director and principal shareholder (the “Key Holder”), and investors
in the Convertible Debentures (the “Investors”), entered with the Company into a Right of First Refusal and Co-Sale Agreement
dated as of January 31, 2020 (the “RFR Agreement”), pursuant to which the Key Holder granted to the Company the right of
first refusal to purchase all or any portion of common stock that the Key Holder proposes to transfer, at the same price and terms as
offered to the proposed transferee. The right of first refusal is subject to certain notice requirements and applicable purchase terms.
The Key Holder also agreed to grant to the Investors, secondary refusal right to purchase all or any portion of the common stock proposed
to be transferred by the Key Holder that has not been purchased by the Company pursuant to the right of first refusal. The grant of the
secondary refusal right is subject to certain notice requirements and additional purchase terms as set forth in the RFR Agreement.

 

 

 

 

Shares Eligible for Future Sale – Rule
144

 

Under Rule 144, as currently in effect, once
we have been subject to the public company reporting requirements of the Exchange Act for at least 90 days, and we are current in our
Exchange Act reporting at the time of sale, a person (or persons whose shares are required to be aggregated) who is not deemed to have
been one of our “affiliates” for purposes of Rule 144 at any time during the 90 days preceding a sale and who has beneficially
owned restricted securities within the meaning of Rule 144 for at least six months, including the holding period of any prior owner other
than one of our “affiliates,” is entitled to sell those shares in the public market without complying with the manner of
sale, volume limitations, or notice provisions of Rule 144, but subject to compliance with the public information requirements of Rule
144. If such a person has beneficially owned the shares proposed to be sold for at least one year, including the holding period of any
prior owner other than one of our “affiliates,” then such person is entitled to sell such shares in the public market without
complying with any of the requirements of Rule 144.

 

In general, under Rule 144, as currently in
effect, once we have been subject to the public company reporting requirements of the Exchange Act for at least 90 days, our “affiliates,”
as defined in Rule 144, who have beneficially owned the shares proposed to be sold for at least six months, are entitled to sell in the
public market, within any three-month period, a number of those shares that does not exceed the greater of:

 

· 1%
of the number of shares of our common stock then outstanding, which will equal shares immediately
after the completion of this offering; or
     
· the
average weekly trading volume of our common stock on during the four calendar weeks preceding
the filing of a notice on Form 144 with respect to such sale.

 

Such sales under Rule 144 by our “affiliates”
or persons selling shares on behalf of our “affiliates” are also subject to certain manner of sale provisions, notice requirements,
and requirements related to the availability of current public information about us.

 

Restrictions on the Reliance of Rule 144 by Shell Companies
or Former Shell Companies

 

Rule 144(i) “Unavailability to Securities of Issuers with No or
Nominal Operations and No or Nominal Non-Cash Assets” provides that Rule 144 is not available for the resale of securities initially
issued by an issuer that is a “shell company” as that term is defined in section 405 of the Securities Act. The Company has
previously been identified as a shell company until January 30, 2020 (see “
Corporate History and Other Information” on page
3). Rule 144 is not available for resale of securities issued by any shell companies (other than business combination related shell
companies) or any issuer that has been at any time previously a shell company. Rule 144(i) provides an important exception to this prohibition,
however, if the following conditions are met: 

 

  · The issuer of the securities that was formerly a shell company has ceased to be a shell company;
  · The issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
  · The issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and
  · At least one year has elapsed from the time that the issuer filed current comprehensive disclosure with the SEC reflecting its status as an entity that is not a shell company.

 

Transfer Agent

 

The transfer agent and registrar of our common
stock is Action Stock Transfer Corporation, located at 2469 E. Fort Union Blvd., Suite 214 Salt Lake City, UT 84121.

 

 

 

 

 

 

 

 

Management
and Certain Security Holders

 

Directors and Executive Officers

 

The following table sets forth certain information
regarding our directors and executive officers as of the date of this prospectus.

 

Name Age Position(s) DATES HELD
Executive Officers      
Eric Gravengaard 47

Chief Executive Officer, Director,

Interim Chief Financial Officer

January, 2020 – present

May 2022 – present (ICFO)

Edward Weinhaus 49 President, Director January, 2020 – present
Parikshat Suri 54 Chief Financial Officer February 2021 – May 2022
Non-Employee Directors      
Michael Pruyn(2) 38 Director May, 2022 – present
Michael Komaransky (1) 43 Director March 2020 – May 2022
Huaxing Lu 34 Director March, 2020 – present
Esteban Suarez 42 Director March, 2020 – present

 

(1) Mr. Komaransky resigned as the Company’s director effective on May 6, 2022 and his resignation
was accepted by the Company’s Board of Directors. Mr. Komaransky’s decision to resign from the Board of Directors was not
a result of a disagreement with management regarding the Company’s operations, policies, practices or otherwise.
(2) Mr. Komaransky nominated Michael J. Pruyn to the Board of Directors, and Mr. Pruyn was appointed as
a member of the Board of Directors effective on May 6, 2022.

 

The following is a biographical summary of
the experience of our directors and executive officers. Each director of the Company serves for a term of one year or until the successor
is elected at the Company’s annual shareholders’ meeting and is qualified, subject to removal by the Company’s shareholders
and subject to the provisions of our Amended and Restated Articles of Incorporation and that certain Voting Agreement as described below. Each executive officer serves at the discretion of the board of directors and holds office until the officer’s successor is duly
elected and qualified, or until the officer’s earlier resignation or removal.

 

Eric Gravengaard has served as our CEO
and director since January 30, 2020 and as our Chief Financial Officer since January 31, 2020 until February 3, 2020 and again since
May 2022 until the present time. Mr. Gravengaard is a co-founder of Athena Bitcoin, Inc. and has served as its Chief Executive Officer
since its inception in September, 2015. Mr. Gravengaard also holds a position of CIO of Red Leaf Advisors LLC, a Bitcoin investment company,
since January 2016 in which he has a controlling interest (see Note 16 to the Financial Statements). Mr. Gravengaard was formerly a trader
at Zen Trading FX, a non-bank liquidity provider trading G-10 and select EM currencies on multiple FX platforms. Previously, he was a
Portfolio Manager at Rock Capital Markets, a Director at Chicago Trading Company, and Director of Quantitative Strategies at Spot Trading,
all in Chicago. Mr. Gravengaard earned an M.B.A. from the University of Chicago Graduate School of Business, and an S.B. in Mechanical
Engineering from the Massachusetts Institute of Technology. We believe that Mr. Gravengaard’s background in the industry and leadership
experience as a co-founder and CEO of Athena Bitcoin qualify him to serve on the Board.

 

Edward “Coach” Weinhaus, Esq. has
served as our President and director since January 30, 2020. Mr. Weinhaus is a co-founder of Athena Bitcoin and served as a director since
September, 2015. Mr. Weinhaus is also a manager of consultancy RelbanE, and a consultant to the Company since 2015. Mr. Weinhaus is an
attorney, academic, and faculty lecturer at UCLA Anderson School of Management where he currently teaches Entrepreneurial Strategy and
the Law and other Entrepreneurship courses. He has been a lecturer at UCLA since 2016. From November 2018 until June 2019, Mr. Weinhaus
served as an Assistant Professor (Adj.) at University of Chicago Booth School of Business where he taught Booth’s first course in
cryptocurrency and blockchain (and previously had earned his M.B.A.). Mr. Weinhaus is the Managing Attorney of law firm LegalSolved and
is a partner at the appellate law firm Ste. Monique Appellors. He previously taught at Washington University’s Olin Business School
and Pepperdine University’s Graziadio Business School. Mr. Weinhaus currently conducts his doctoral research in Cryptocurrency and
Liberty at Washington University School of Law in St. Louis working towards his JSD degree. Mr. Weinhaus holds JD and LLM degrees from
Washington University School of Law in St. Louis, a B.Sc. from London School of Economics and an M.Sc. in Digital Currency. We believe
Mr. Weinhaus is qualified to serve on our board because of his experience as the co-founder of the Athena Bitcoin and knowledge of Bitcoin
and the blockchain industry.

 

 

 

 

 

Michael “Mike” Pruyn has been
the Company’s director since May, 2022. Michael Pruyn joined BMO Capital Markets in 2016 and is a Vice President in the ABS Banking
group. Prior to joining BMO, Michael spent nearly eight years in the derivatives trading industry, focusing primarily on listed ETF and
Equity Index Options. He has a B.A. in Economics from Northwestern University and an M.B.A. from the University of Texas at Austin, McCombs
School of Business. He is a holder of FINRA series 7, 63, and 79 licenses. We believe that Mr. Pruyn is qualified to serve as a director
on our Board because of his experience in the financial services industry.

 

Huaxing “Jason” Lu has
been a director of the Company since March, 2020. Mr. Lu has been a managing director at Komodo Bay Capital since May, 2020. Prior to
joining Komodo Bay Capital, he was a trader at 4170 Trading from February, 2018 until May, 2020, where he started and ran the cryptocurrency
focused subsidiary, Grapefruit Trading. From March, 2017 until February, 2018, Mr. Lu worked in numerous other trading roles at Old Mission
Capital, and prior to 2017, at MSR Investments (2011-2017). Mr. Lu graduated from the University of Illinois Urbana-Champaign in 2008
with a dual degree in Electrical Engineering and Economics. Mr. Lu’s significant experience building and overseeing successful
cryptocurrency businesses was instrumental in his selection as a member of the Board.

 

Esteban “Steve” Suarez has
been a director of the Company since March. 2020. Mr. Suarez has been the CEO of BlackStage Productions, an innovative event planning
firm since April, 2019 and the CEO of Ultimate Gamer, E-Sports medium, since January, 2017. From January, 2010 until January, 2019, Mr.
Suarez founded and led a large event company, which held an annual fitness festival called Wodapalooza. From 2016 to 2018, he was the
President of Loud and Live, an entertainment company. Mr. Suarez created the Spanish language political website www.epolitico.com
that was later sold to a private equity firm in 2003. Mr. Suarez has an MBA from Florida International University. We believe that Mr.
Suarez is qualified to serve as a member of our Board because of the perspective and experience he brings from his successful entrepreneurial
endeavors.

 

Family Relationships

 

There are no family relationships among any
of our executive officers or directors.

 

Arrangements between Principal Shareholders,
Officers and Directors

 

Our Amended and Restated Articles of Incorporation
(the “Amended Articles”) provide that our principal shareholder, Mike Komaransky, who was a lead investor through
his entity KGPLA Holdings, LLC, a Delaware corporation (the “Lead Investor”) in the Company’s private placement of
convertible debentures in January, 2020, is entitled to elect three (3) out of five (5) directors of the Company (the “Lead Investor
Directors”) and our CEO, Director and principal shareholder, Eric Gravengaard (the “Key Holder”) is entitled to elect
two (2) of five (5) directors of the Company for so long as such Key Holder(s) maintain(s) a certain amount of such shares pursuant to
the Voting Agreement entered as of January 31, 2020 by and between the Company, Lead Investor and Key Holder (the “Voting Agreement”).
The Voting Agreement has been subsequently amended in July, 2021, to provide for certain conditions which would cause the Lead Investor
to relinquish his right to appoint one (1) of the three (3) nominee directors to the Board of the Company. See
Description of Capital Stock, Voting Agreements on page 72. The Lead Investor and the Key Holder hold their respective rights with respect
to the election of the directors to the Board of the Company, as long as they maintain the required amount of their respective holdings
of common stock of the Company, as set forth in the Amended Articles.

 

Directors Pruyn, Lu and Suarez were appointed
by Mr. Komaransky as the Lead Investor, and directors Gravengaard and Weinhaus were appointed by Mr. Gravengaard who is the Key Holder
(pursuant to the provisions of the Amended Articles). Except as set forth herein, to our knowledge, there is no arrangement or understanding
between any of our officers or directors and any other person pursuant to which the officer was selected to serve as an officer.

 

Board Structure

 

Our business and affairs are managed under
the direction of our Board, which currently consists of five members. Each of our current directors will continue to serve until the
election and qualification of his or her successor, or his or her earlier death, resignation or removal. In accordance with our Amended
Articles and Voting Agreement, our directors are elected by Lead Investor and Key Holder having a required number of shares of our common
stock as set forth in the Amended Articles. Board will stand for election at each annual meeting of stockholders. Each director will
hold office for a one-year term and until the election and qualification of his or her successor. The authorized number of directors
is determined from time to time solely by resolution of the Board. Our subject to the provisions of the Amended Articles and Voting Agreement.

 

 

 

 

Our Board has designated Eric Gravengaard,
our Chief Executive Officer, to serve as Chairman of the Board. Combining the roles of Chief Executive Officer and Chairman allows one
person to drive strategy and agenda setting at the board level while maintaining responsibility for executing on that strategy as Chief
Executive Officer. Although our Amended Articles and bylaws do not require that we combine the Chief Executive Officer and Chairman positions,
our Board believes that having the positions be combined is the appropriate leadership structure for us at this time. Our Board recognizes
that, depending on the circumstances, other leadership models, such as separating the roles of Chief Executive Officer and Chairman,
might be appropriate. Accordingly, our board of directors may periodically review its leadership structure. Our Board believes its administration
of its risk oversight function has not affected its leadership structure.

 

We face a number of risks, including those described
under the section titled “Risk Factors” included elsewhere in this prospectus. Our board of directors
believes that risk management is an important part of establishing, updating, and executing on the Company’s business strategy.
Our Board, as a whole and at the committee level, has oversight responsibility relating to risks that could affect the corporate strategy,
business objectives, compliance, operations and the financial condition and performance of the Company. Our Board focuses its
oversight on the most significant risks facing the Company and on its processes to identify, prioritize, assess, manage, and mitigate
those risks. While our Board has an oversight role, management is principally tasked with direct responsibility for management and assessment
of risks and the implementation of processes and controls to mitigate their effects on the Company. We do not have any independent directors
at this time.

 

Committees of the Board of Directors.

 

Due to the Company’s size, the Company has
not formally designated a nominating committee, an audit committee, a compensation committee or committees performing similar functions.
The Board currently acts as our audit committee.

 

Code of Conduct and Ethics

 

Our Board has adopted a Code of Ethics that
applies to all of our employees, including our Chief Executive Officer and Chief Financial Officer. The Code of Ethics provides written
standards that we believe are reasonably designed to deter wrongdoing and promote honest and ethical conduct, including the ethical handling
of actual or apparent conflicts of interest between personal and professional relationships, full, fair, accurate, timely and understandable
disclosure and compliance with laws, rules and regulations, including insider trading, corporate opportunities and whistleblowing or
the prompt reporting of illegal or unethical behavior. We will provide a copy, without charge, to anyone that requests a copy of our
Code of Ethics in writing by contacting us at our address provided in this prospectus.

 

Involvement in Certain Legal Proceedings

 

None of our directors and executive officers
has been involved in any of the following events during the past ten years:

 

  (a) any petition under the
federal bankruptcy laws or any state insolvency laws filed by or against, or an appointment of a receiver, fiscal agent or similar
officer by a court for the business or property of such person, or any partnership in which such person was a general partner at
or within two years before the time of such filing, or any corporation or business association of which such person was an executive
officer at or within two years before the time of such filing;
     
  (b) any conviction in a
criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offences);
     
  (c) being subject to any
order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently
or temporarily enjoining such person from, or otherwise limiting, the following activities: (i) acting as a futures commission merchant,
introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person
regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser,
underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings
and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
engaging in any type of business practice; or (iii) engaging in any activity in connection with the purchase or sale of any security
or commodity or in connection with any violation of federal or state securities laws or federal commodities laws;

 

 

 

 

  (d) being the subject of
any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending
or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (c)(i) above,
or to be associated with persons engaged in any such activity;
     
  (e) being found by a court
of competent jurisdiction (in a civil action), the Securities and Exchange Commission to have violated a federal or state securities
or commodities law, and the judgment in such civil action or finding by the Securities and Exchange Commission has not been reversed,
suspended, or vacated;
     
  (f) being found by a court
of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities
law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed,
suspended or vacated;
     
  (g) being the subject of,
or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended
or vacated, relating to an alleged violation of: (i) any federal or state securities or commodities law or regulation; or (ii) any
law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent
injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease- and-desist order, or removal
or prohibition order; or (iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity;
or
     
  (h) being the subject of,
or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined
in Section 3(a)(26) of the Securities Exchange Act of 1934), any registered entity (as defined in Section 1(a)(29) of the Commodity
Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or
persons associated with a member.

 

Director Compensation

 

Our directors did not and do not receive any
compensation for their services as our directors. We will reimburse directors for their reasonable out-of-pocket expenses, including
travel, food, and lodging, incurred in attending meetings of our Board and/or its committees. We do not expect to compensate our employee
directors for their service on our board of directors in the future.

 

Indemnification Agreements

 

We have entered into indemnification agreements
with each of our directors. The indemnification agreements have been effective since the beginning of the term of each respective director
and require us to indemnify these individuals to the fullest extent permitted by Nevada law.

 

Conflicts of Interest and Policy Regarding
Transactions with Related Persons

 

We do not have a formal, written policy for
the review, approval or ratification of transactions between us and any director or executive officer, nominee for director, 5% stockholder
or member of the immediate family of any such person that are required to be disclosed under Item 404(a) of Regulation S-K. However,
our policy is that any activities, investments or associations of a director or officer that create, or would appear to create, a conflict
between the personal interests of such person and our interests must be reviewed by our Board of Directors and determined in accordance
with the applicable provisions of Nevada law, and specifically pursuant to Section 78.140 of Nevada Revised Statutes, which provides
restrictions on transactions involving interested directors or officers, including requirement of full disclosure of such interest to
the Board of Directors, abstention from voting on the matter involving conflict of interest and the determination of the fairness of
the transaction.

 

Equity Compensation Plans

 

In 2016, our wholly-owned subsidiary, Athena Bitcoin,
established the 2016 Equity Incentive Plan (the “2016 Plan”). The 2016 Plan authorized the granting of up to 207,422,610 shares
of common stock to officers, employees, and Board members of the Company. The exercise price of the options was determined by the Board
provided it was not to be less than 100% of the fair market value on the date of grant. As of December 31, 2019, no shares remained
available for future issuance under the 2016 Equity Incentive Plan. The 2016 Plan has been terminated in January, 2020 by Athena Bitcoin.
A total of 126,646 shares resulting from the exercise of the outstanding stock options issued by the Athena Bitcoin were exchanged for
157,635,309 shares of the Company’s common stock.

 

 

 

 

In October, 2021, the Company’s Board of
Directors and its majority shareholders approved the Company’s 2021 Equity Compensation Plan in the amount of 100 million shares
of the Company’s common stock. No securities of the Company have been authorized for issuance nor issued under the 2021 Equity Compensation
Plan as of the date of this prospectus.

 

Shareholder Communications

 

Shareholders who wish to communicate with the
Board may address their written correspondence to either the Board of Directors, or an individual director and mail it to the offices
of the Company at the address on the front page of this prospectus.

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Executive
Compensation

 

The following table sets forth information
regarding each element of compensation that we pay or award to our named executive officers for the fiscal years of 2019, 2020, and 2021.
No other executive officers or directors received annual compensation in excess of $100,000 during the last two fiscal years.

 

Summary
Compensation Table

Name and Principal Position   Year     Salary     Bonus     Stock     Option     Non-Equity     Nonqualified     All Other     Total  
($)                                                      
Eric
Gravengaard
(1)
    2021       250,000       50,000                                     300,000  
Chief Executive Officer     2020       250,000                                           250,000  
      2019       166,029                   46,820                         212,849  
Edward
Weinhaus
(2)
    2021       28,646                                     115,051       143,697  
President     2020                                           169,806       169,806  
      2019                           46,820                   159,044       205,864  
Parikshat
Suri
(3)
    2021       229,167       50,000                               60,460       339,627  
Chief Financial Officer     2020                                                  

 

(1) includes an option granted prior to the Share Exchange
in common stock of Athena Bitcoin pursuant to the 2016 Plan. Such option was subsequently exercised into 4,856 shares of Athena Bitcoin’s
common stock at an exercise price of $16.09 per share, and exchanged in the Share Exchange transaction into 6,044,226 shares of the
Company’s common stock. 
   
(2) includes an option granted prior to the Share Exchange in common
stock of Athena Bitcoin pursuant to the 2016 Plan. Such option was subsequently exercised into 4,856 shares of Athena Bitcoin’s
common stock at an exercise price of $16.09 per share, and exchanged in the Share Exchange transaction into 6,044,226 shares of the
Company’s common stock.  See also Certain Relationships and Related Party Transactions for additional disclosure regarding
payment to Advisory FX LLC for Mr. Weinhaus’ services as the President of the Company.
   
(3) excludes $291,119 in accounting and financial consulting fees paid
during the period from March, 2020 to February, 2021 (prior to Mr. Suri’s appointment as the Company’s CFO), to Radiant
Consulting, LLC, an entity beneficially owned and controlled by Mr. Suri. The compensation for Mr. Suri’s consulting services
is not included in this Summary Compensation Table because it was received prior to his appointment as the Company’s CFO.

 

 

 

 

Outstanding Equity Awards at 2021 Fiscal-Year
End

 

The following table sets forth information regarding outstanding
equity awards at the end of 2010 for each of our NEOs.

 

    Option
Awards
Stock
Awards
 
Name   Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
    Number
of
Securities
Underlying
Unexercised
Options

(#)
Unexercisable
      Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options

(#)
      Option
Exercise
Price

($)
      Option
Expiration
Date
    Number
of
Shares
or Units
of Stock
That
Have
Not
Vested
(#)
    Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested

($)
      Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested

(#)
      Equity
Incentive
Plan
Awards:

Market
or Payout
Value Of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested

($)
 
                 0     0       0       0       0     0     0       0       0  

 

Employment Contracts, Termination of
Employment

 

We do not have employment contracts with our
officers, however, we have signed Offer Letter with our Chief Financial Officer which provides for an annual salary of $250,000, health
and transit benefits, vacation time and participation in the Company’s equity compensation plan. In an event of termination without
cause, Mr. Suri would be entitled to receive compensation equal to six-months of his base salary. See Exhibit 10.12. We have also terminated
our oral agreement with Advisory FX LLC in October 2021, and Mr. Weinhaus is compensated directly for his services as the Company’s
President.

 

Compensation of Directors

 

Our directors did not and do not receive any
compensation for their services as our directors. We will reimburse directors for their reasonable out-of-pocket expenses, including
travel, food, and lodging, incurred in attending meetings of our Board and/or its committees. We do not expect to compensate our employee
directors for their service on our board of directors in the future.

 

Outstanding Equity Awards at Fiscal Year-End
December 31, 2021

 

Not applicable. At the end of 2020, there
were no equity awards outstanding, and the Company has not adopted such a plan.

 

Prior to the Share Exchange transaction, as defined
elsewhere in this prospectus, the Company’s subsidiary had 2016 Stock Option Plan which was terminated in January, 2020. See Note
11 to the Financial Statements.

 

 

 

 

 

 

 

 

 

 

Principal
Shareholders

 

The following table sets forth certain information
regarding the beneficial ownership of our capital stock outstanding as of May 12, 2022 by:

 

  · each person, or group of affiliated persons, known by us to beneficially
own more than 5% of our shares of common stock;
  · each of our directors;
  · each of our named executive officers; and
  · all of our directors and named executive officers as a group.

 

The percentage ownership information is based
on 4,089,409,545 shares of common stock outstanding as of March 10, 2022. Information with respect to beneficial ownership has
been furnished by each director, officer or beneficial owner of more than 5% of our common stock. We have determined beneficial ownership
in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole
or shared voting power or investment power with respect to those securities. In addition, the rules attribute beneficial ownership of
securities as of a particular date to persons who hold options or warrants to purchase shares of common stock and that are exercisable
within 60 days of such date. These shares are deemed to be outstanding and beneficially owned by the person holding those options or
warrants for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose
of computing the percentage ownership of any other person. Unless otherwise indicated, the persons or entities identified in this table
have sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to applicable community
property laws.

 

Except as otherwise noted below, the address for
each person or entity listed in the table is c/o Athena Bitcoin Global, 1332 N Halsted St., Suite 403, Chicago, IL 60642.

 

Name of Beneficial Owner   Number of
shares
beneficially
owned
(1)
    Percentage of
shares
beneficially
owned
 
Directors and Named Executive Officers                
ERIC GRAVENGAARD (2)     1,151,484,077       28.16%  
EDWARD WEINHAUS (3)     27,618,811       *  
PARIKSHAT SURI (Resigned May 4, 2022)            
Non-Employee Directors              
MICHAEL PRUYN            
HUAXING LU            
ESTEBAN SUAREZ            
5% Stockholders              
MICHAEL KOMARANSKY (4)     1,771,141,192       40.82%  
Entities Affiliated with SWINGBRIDGE (5)     429,494,749       10.50%  
All Named Executive Officers and Directors as a Group (6 persons)     1,179,102,888       27.17%  

 

*Less than one percent

___________________

(1) Based on 4,089,409,545 shares of our common stock outstanding
as of March 10, 2022. To calculate a stockholder’s percentage of beneficial ownership, we include in the numerator and
denominator the common stock outstanding and all shares of our common stock issuable to that person in the event of the conversion
of outstanding Convertible Debentures owned by that person which are convertible within 60 days of the date of this prospectus.
Convertible Debentures held by other stockholder(s) are disregarded in this calculation. Therefore, the denominator used in calculating
beneficial ownership among our stockholders may differ. Unless we have indicated otherwise, each person named in the table has sole
voting power and sole investment power for the shares listed opposite such person’s name.
(2) Consists of: (i) 863,960,473 shares of common stock held of record by Eric Gravengaard, as Trustee of the Eric L. Gravengaard Trust of 2011 and (ii) 287,523,604 shares of common stock held of record by Eric Gravengaard.
(3) Consists of: (i) 8,948,426 shares of common stock held of record by Edward Weinhaus; and (ii) 18,670,385 shares of common stock held of record by Liberty Digital Holdings, LLC, an entity beneficially owned and controlled by Mr. Weinhaus.
(4) Consists of: (i) 1,521,141,192 shares of common stock held of record
by Athena Equity LLC, an entity beneficially owned and controlled by Mr. Komaransky; and (ii) includes 250,000,000 shares of common
stock issuable upon the conversion of Convertible Debentures in the principal amount of $3,000,000 held of record by KGPLA, LLC,
an entity beneficially owned and controlled by Mr. Komaransky. The assumed conversion price is $0.012 per share. See Description
of Securities
, page 69.
(5) Consists of: (i) 191,454,966 shares of common stock held of record
by Swingbridge Crypto I LLC; (ii) 50,271,880 shares of common stock held of record by Swingbridge Crypto II LLC; (iii) and 187,767,904
shares of common stock held of record by Swingbridge Crypto III LLC. Tom Kerestes is the manager and beneficial owner of Swingbridge
Crypto I LLC, Swingbridge Crypto II LLC and Swingbridge Crypto III LLC.

 

 

 

 

Certain
Relationships and Related Party Transactions

 

Except as set forth
below, there were no transactions during our fiscal years ended December 31, 2021 and 2020 to which we were a party, including transactions
in which the amount involved in the transaction exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for
the last two completed fiscal years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of
more than 5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or
indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are
described elsewhere in this registration statement. We are not otherwise a party to a current related party transaction, and no transaction
is currently proposed, in which the amount of the transaction exceeds the lesser of $120,000 or 1% of the average of our total assets
at year-end for the last two completed fiscal years and in which a related person had or will have a direct or indirect material
interest.

 

On January 31, 2020, the Company entered
into a convertible debenture agreement with KGPLA Holdings LLC, an entity in which Mike Komaransky, the Company’s former
director and principal shareholder, has ownership interest. The convertible debenture provided for a principal amount of $3,000,000,
with a maturity date of January 31, 2025. Interest as defined by the agreement is 8% per annum. KGPLA Holdings, LLC has the option
to convert the outstanding principal and accrued interest balance into common stock of the Company at the lower of $0.012 per share
or 20% discount to the next major financing or change in control. As of December 31, 2020, the outstanding principal was $3,000,000.
See also “
Description of Capital Stock” on page 69.

 

On January 31, 2020,
the Company entered into a security purchase agreement for Convertible Debenture with Swingbridge Crypto III, LLC., a shareholder of
the Company. The convertible debenture provided for a principal amount of $125,000, with a maturity date of January 31, 2025. Interest
as defined by the agreement is 8% per annum. Swingbridge Crypto III LLC. has the option to convert the outstanding principal and accrued
interest balance into common stock of the Company at the lower of $0.012 per share or 20% discount to the next major financing or change
in control. As of December 31, 2020, the outstanding principal was $125,000. As of February 28, 2022, the principal amount and accrued
interest was converted to 10,416,666 shares of the Company’s common stock.

 

The Company continues to carry a payables
balance to Red Leaf Advisors, an entity in which Eric Gravengaard, our CEO has controlling interest in, for previous purchases of crypto
assets. The outstanding balance due to Red Leaf Advisors as of December 31, 2020 and 2019 was $406,905 and $531,905, respectively, and
is recorded in accounts payable, related party in the consolidated balance sheets. See Note 18 on page F-25 and Note 17 on page F-49.

 

On August 22, 2018, the Company entered into a
loan agreement with Mike Komaransky, the Company’s former director and principal shareholder (“Bitcoin Agreement”).
Under this Bitcoin Agreement, the Company borrowed 30 bitcoin initially due on August 22, 2019. The borrowing fee as defined in the agreement,
is 13.5% of the outstanding principal. On July 12, 2021, Athena Bitcoin and the Company entered into Loan Restructuring and Related Amendments
Agreement (the “Restructuring Agreement”) with Mr. Komaransky and Eric Gravengaard, the Company’s CEO, director and
principal shareholder, with respect to the Bitcoin Agreement and certain other agreements. As of the date of the Restructuring Agreement,
the Company had still a balance due of approximately 21.6 bitcoin. Pursuant to the terms of the Restructuring Agreement, the Company entered
into First Amendment of the Loan Agreement which amended the terms of the Bitcoin Agreement. The new amended terms included the extension
of the maturity date to May 31, 2022, mandatory weekly payments of $35,000 in Bitcoin and a grant of first priority security interest
in all property described in that certain security agreement entered into at the same time. In addition, the First Amendment to the Loan
Agreement provided for conversion of the note into U.S. dollars any time after June 30, 2021, if the market price of one bitcoin equals
to or exceeds $75,000.

 

In November 2018, the Company entered into
another agreement with the same former director and principalshareholder, Mike Komaransky. The agreement provides for up to four additional
borrowings at 50 bitcoin increments with an initial term of 90 days for each loan. Fees for these borrowings is the greater of 10% of
the outstanding principal or 0.4% of total ATM sales. The Company borrowed 50 bitcoins under this agreement in November 2018 and an additional
50 bitcoin in March 2019. The Company repaid these Bitcoin borrowings in the year ended December 31, 2021.

 

   

December
31, 2021

    December
31, 2020
 
Bitcoin borrowed outstanding     0       30  

 

The carrying value of the outstanding host
contracts as of December 31, 2021 and 2020 was $0 and $193,000 respectively, and the fair value of the embedded derivative liabilities
as of December 31, 2021 and 2020 was $0 and $688,000 respectively. During the years ended December 31, 2021 and 2020, the Company paid
$119,000 and $337,000 of borrowing fees in crypto assets, respectively. See also Note 6 on Page F-18 and Note 5 on Page F-43.

 

 

 

 

Company’s Transactions with Mr.
Weinhaus

 

In March 2016, the Company previously engaged
Mr. Weinhaus’ services as the President of the Company through an oral agreement with AdvisoryFX LLC. Mr. Weinhaus has no beneficial
ownership interest in AdvisoryFX LLC, nor is he an officer or director of said company. AdvisoryFX LLC engaged Control NEW MLSS LLC.,
in which Mr. Weinhaus is a beneficial owner (99% ownership). AdvisoryFX LLC received a total of $132,873.33 in the fiscal year ended December
31, 2019 and a total of $148,745.81 in the fiscal year ended December 31, 2020, and a total of $115,050.89 for the period of January 1,
2021 through October 15, 2021. The Company terminated its oral agreement with AdvisoryFX LLC as of October 15, 2021. Mr. Weinhaus is currently
compensated directly from the Company for his services as the President of the Company.

 

Mr.
Weinhaus, has a beneficial interest in the return on the investment in the amount of $150,000 in the Company’s 6% Convertible Debentures
made by JJE Management LLC, who is a general partner of TOI Fund L.P (the “Fund”). Mr. Weinhaus became a minority member
of JJE Management LLC in March, 2021 when he provided legal services to said entity. Mr. Weinhaus is not an officer or managing member
of JJE Management LLC and had no decision-making authority regarding the Fund’s investment in the Company’s 6% Convertible
Debentures. Should the Convertible Debenture earn only interest, then Mr. Weinhaus will earn 4% of such accrued interest. Should the
Convertible Debenture convert to common stock and earn a higher return, Mr. Weinhaus could earn a maximum of 8% of the profits of the
Fund’s investment in the Convertible Debenture.

 

Investors’ Rights Agreement

 

In January, 2020, we entered into investors’
rights agreement (the “Investors’ Rights Agreement”) with certain holders of our 8% Convertible Debentures, including
KGPLA Holdings, LLC and Swingbridge Crypto III LLC, each holder of the registration rights under the Agreement is a holder of more than
5% of our capital stock. Mr. Komaransky, a beneficial owner of KGPLA Holdings LLC, is also a former member of our board of directors
(resigned in May, 2022). These stockholders are entitled to rights with respect to the registration of their shares issuable upon the
conversion of Convertible Debentures following the effectiveness of the registration statement of which this prospectus forms a part.
For a description of these registration rights, see the section titled “Description of Capital Stock—Registration
Rights
.”

 

Indemnification Agreements

 

We have entered into indemnification agreements
with each of our current directors. The indemnification agreements, our Amended Articles, and our restated bylaws, require us to indemnify
our directors to the fullest extent not prohibited by Nevada law. Subject to certain limitations, our restated bylaws also require us
to advance expenses incurred by our directors and officers. See also “Description of Capital Stock
on page 69.

 

Right of First Refusal and Co-Sale Agreement

 

In January, 2020, we entered into a Right of
First Refusal and Co-Sale Agreement with Eric Gravengaard, the Company’s officer, director and principal shareholder and investors
in the Convertible Debentures (the “Investors”) pursuant to which Mr. Gravengaard granted to the Company the right of first
refusal to purchase all or any portion of common stock that he proposes to transfer, at the same price and terms as offered to the proposed
transferee. Mr. Gravengaard also agreed to grant to the Investors, secondary refusal right to purchase all or any portion of the common
stock proposed to be transferred by him that has not been purchased by the Company pursuant to the right of first refusal. See also “Description of Capital Stock” on page 69.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Use
of Proceeds

 

We will not receive any proceeds from the
sale of Common Stock by the selling security holders. All net proceeds from the sale of our Common Stock will go to the selling security
holders as described below in the sections entitled “Selling Shareholders” and “Plan
of Distribution.” We have agreed to bear the expenses relating to the registration of the Common Stock for the selling security
holders.

 

DIVIDEND
POLICY

 

We have never declared or paid any cash dividends
on our capital stock. We intend to retain future earnings, if any, to finance the operation and expansion of our business and do not
anticipate paying any cash dividends in the foreseeable future. Any future determination related to our dividend policy will be made
at the discretion of our board of directors after considering our financial condition, results of operations, capital requirements, business
prospects and other factors our board of directors deems relevant.

 

Determination
of Offering Price

 

The prices at which the shares of common stock
covered by this prospectus may be sold will be determined by the prevailing public market price for shares of common stock, by negotiations
between the selling security holders and buyers of our common stock in private transactions or as otherwise described in the “Plan
of Distribution.”

 

The offering price of the shares of our common
stock does not necessarily bear any relationship to market value, our book value, assets, past operating results, financial condition,
or any other established criteria of value.

 

Our common stock is currently quoted on OTC
Pink Market. We will be filing with OTC Markets Group, Inc. to obtain quotation on the OTCQB. There is no assurance that our common stock
will trade at any certain market price, as prices for the common stock in any public market, which may develop, will be determined in
the marketplace, and may be influence by many factors, including the depth and liquidity of that market.

 

Dilution

 

Not applicable. The Shares registered under
this registration statement are not being offered for purchase from the Company. The shares are being registered on behalf of the Selling
Shareholders.

 

 

 

 

 

 

 

Selling
ShareHolders

 

The Selling Shareholders named in this prospectus
are offering 459,783,937 shares of common stock including: (i) 409,933,937 shares of common stock that were issued by us
to the Selling Shareholders in the Share Exchange transaction or were purchased by the Selling Shareholders in private transactions,
and (ii) up to 49,850,000 shares of common stock issued or issuable upon exercise of the principal amount of our outstanding 6%
Convertible Debentures Due 2023 (the ”Convertible Debentures”) which were issued in connection with a private placement financing
in 2021 (the “Private Placement”). We are registering the resale of the shares of common stock underlying the Convertible
Debentures as required by the Purchase Agreement, as defined in this prospectus, that we entered into with the Selling Shareholders as
of June 22, 2021, which provided said Selling Shareholders with certain registration rights with respect to the common stock issuable
upon conversion of the Convertible Debentures. We will not receive any proceeds from the sale of shares being sold by Selling Shareholders.

 

The Selling Shareholders of 409,933,937 shares
of common stock include our affiliates and certain other stockholders with “restricted securities” (as defined in Rule 144
under the Securities Act) and their pledgees, donees, transferees, assignees, or other successors-in-interest who, because of their status
as affiliates pursuant to Rule 144 or because they acquired their shares of common stock an affiliate or from us as of January 30, 2020
pursuant to the Share Exchange Agreement, as defined in this prospectus, would be unable to sell their securities pursuant to Rule 144
until we have been subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act for an indefinite period since
such shares were issued by the Company when it was a “shell company” as defined in the Securities Act, and certain shareholders
of the Company who received their shares of common stock in the Company prior to the Share Exchange with Athena Bitcoin, including their
pledgees, donees, transferees, assignees, or other successors-in-interest (also, see Sales of Unregistered Securities).

 

The shares being offered hereby are being registered to permit public secondary trading,
and the Selling Shareholders may offer all or part of the shares for resale from time to time, however, they are under no obligation
to sell all or any portion of such shares nor are the Selling Shareholders obligated to sell any shares immediately upon effectiveness
of this prospectus. The Selling Shareholders and their pledgees, donees, transferees, assignees, or other successors-in-interest may
elect to sell their shares common stock covered by this prospectus, as and to the extent they may determine. As such, we will have no
input if and when any Selling Shareholders may elect to sell their shares of common stock or the prices at which any such sales may occur.
We cannot provide an estimate of the number of our securities that the Selling Stockholders will hold in the future. See the section
titled “
Plan of Distribution.”

 

The amount of shares of common stock of each Selling Shareholder registered
pursuant to this prospectus has been arbitrarily determined by the Company, and is not subject to any pre-existing agreement(s). The
Selling Shareholders have furnished all information with respect to share ownership.

 

 

 

 

 

 

 

 

 

 

The Selling Shareholders have not, nor have
they within the past three years had, any position, office, or other material relationship with us, other than as disclosed in this prospectus.
See the sections titled “Management” and “Certain Relationships and Related Party Transactions” for further information regarding the Selling Shareholders.

 

                Beneficial Ownership of Common Stock After the Offering  
Name of Selling Shareholder   Number of Shares of Common Stock Prior to the Offering     Common Stock Saleable Pursuant to This Prospectus     Number of Shares     Percent of Class  
Executive Officers                                
ERIC GRAVENGAARD     1,151,484,077       14,279,100       1,137,204,977       27.81%  
EDWARD WEINHAUS     27,618,811       3,151,300       24,467,511       *  
5% Stockholders                                
MICHAEL KOMARANSKY     1,521,141,192       76,057,000       1,445,084,192       35.34%  
Entities Affiliated with SWINGBRIDGE     429,494,749       21,474,737       408,020,012       9.98%  
Other Selling Stockholders                                
JONATHAN MORK     177,751,020       134,557,600       43,193,420       1.06%  
MAGELLAN CAPITAL PARTNERS INC     152,200,353       130,725,200       21,475,153       *  
JEREMY MORK     16,021,050       13,760,500       2,260,550       *  
LINDSAY GARRISON     85,883,774       4,294,000       81,589,774       2.00%  
TODD KLEIN     30,422,821       1,521,100       28,901,721       *  
LAUREN DELUCA     15,211,410       770,500       14,440,910       *  
RYAN SULLIVAN     15,211,410       770,500       14,440,910       *  
SHC VENTURES LLC     15,211,410       770,500       14,440,910       *  
RICHARD DOERMER     14,547,890       737,300       13,810,590       *  
DAN SCHWARTZ     13,338,897       676,800       12,662,097       *  
BEN ROSS     5,335,558       266,700       5,068,858       *  
NICOLE LOITERSTEIN     5,335,558       266,700       5,068,858       *  
KIRKLAND & ELLIS LLP     3,650,745       182,500       3,468,245       *  
Current and Former Employees & Contractors                                
ATHENA BLOCKCHAIN, INC.     12,944,801       1,941,700       11,003,101       *  
GILBERT VALENTINE     169,098,926       1,690,900       167,408,026       4.09%  
ERIC MATSON     5,103,239       765,400       4,337,839       *  
MATIAS GOLDENHÖRN     4,356,423       653,400       3,703,023       *  
BRIAN SCHWARTZ     12,446,924       124,400       12,322,524       *  
DANTE GALEZZI     622,346       93,300       529,046       *  
CHAD DAVIS     622,346       93,300       529,046       *  
MICHAEL LEON     622,346       93,300       529,046       *  
PATRICK PATTON     248,938       37,300       211,638       *  
JOHN BERGQUIST     186,704       28,000       158,704       *  
ADAM SAITER     2,074,902       20,700       2,054,202       *  
BILL ULIVIERI     124,469       18,600       105,869       *  
JENNY BALLIET     124,469       18,600       105,869       *  
HERNAN ALVIDE     124,469       18,600       105,869       *  
KATRYN DICKOVER     124,469       18,600       105,869       *  
VANESSA FLORES     124,469       18,600       105,869       *  
MARTIN MELIENDREZ     124,469       18,600       105,869       *  
MARTIN WESOLOWSKI     124,469       18,600       105,869       *  
SUB TOTAL             409,933,937                  

 

 

 

 

Purchasers of the 6% Convertible Debenture                                
Shares to be issued to 6% Convertible Debenture Holders     15,550,000       15,550,000              
QUANTUM PARTNERS, LP     4,313,805       4,313,805              
RYAN MYERS     4,100,000       4,100,000              
TODD KLEIN     2,500,000       2,500,000              
MERCER STREET GLOBAL OPPORTUNITY FUND, LLC     3,500,000       3,500,000              
LAWRENCE SPIELDENNER     2,500,000       2,500,000              
FP AUSTRALIA LLC     1,000,000       1,000,000              
JONATHAN LAMENSDORF     1,000,000       1,000,000              
PAUL KUSAK     1,000,000       1,000,000              
TOI FUND LP     1,000,000       1,000,000              
JOHN CRICK     750,000       750,000              
STEVEN HELLER     750,000       750,000              
CRAIG HERKIMER     500,000       500,000              
JAMES GRANAT     500,000       500,000              
JEFFREY EVERSON     500,000       500,000              
JOHN CAUFFIEL     500,000       500,000              
JOHN SUPERSON     500,000       500,000              
JONATHAN CARSON     500,000       500,000              
MICHAEL O’GRADY     500,000       500,000              
RODOLFO FLORES     500,000       500,000              
2S HOLDINGS LLC     375,000       375,000              
JAMES LYDIARD MEAD     350,000       350,000              
PALINDROME MASTER FUND LP     336,195       336,195              
CAUFFIEL INVESTMENTS, LLC     300,000       300,000              
CORT BARRETT     300,000       300,000              
APRIL A GIVEN     250,000       250,000              
BRANDON S. REIF     250,000       250,000              
BRYAN BLOOM     250,000       250,000              
CHARLES WILDES     250,000       250,000              
DAVID PERL     250,000       250,000              
EDWARD CRIMMINS     250,000       250,000              
ET FAMILY CORP     250,000       250,000              
JARED MACKOUL     250,000       250,000              
JEFFREY GOOCH     250,000       250,000              
JEROME KLINT     250,000       250,000              
JOHN WILLIAM WHITAKER, JR. TRUST     250,000       250,000              
LIMPHAM, LLC     250,000       250,000              
MATHEW THACKER     250,000       250,000              
MBL MANAGEMENT LLC     250,000       250,000              
NICKY GATHRITE     250,000       250,000              
TARA S MAJEED     250,000       250,000              
ANTHONY TEMESVARY     200,000       200,000              
JASON BURSTEIN     200,000       200,000              
JOHN-MARC BERTHOUD     200,000       200,000              
JONATHAN BURSTEIN     200,000       200,000              
ZACH BROYER     200,000       200,000              
QUANT TWO LLC     150,000       150,000              

 

 

 

 

 

 

 

DANIEL KING     125,000       125,000              
CHRIS FAHY     100,000       100,000              
DANIEL TUREK     100,000       100,000              
DANIEL WINOGRAD     100,000       100,000              
IAN SAMUEL     100,000       100,000              
IVANKOVICH FAMILY TRUST     100,000       100,000              
JORDAN POSELL     100,000       100,000              
KYLE CETRULO     100,000       100,000              
MIKE LEON     100,000       100,000              
STEVEN PETERSON     100,000       100,000              
WILLIAM STEWART JONES     50,000       50,000              
SUB TOTAL             49,850,000                  

 

* Represents less than 1%

 

(1) Based on 4,089,409,545 shares of common stock outstanding
as of March 10, 2022. This registration statement covers a maximum of 459,783,937 shares. Assumes that each shareholder
will sell all the shares registered in this prospectus.
(2) This is on a non-diluted basis and reflects only the percentage
of the issued and outstanding shares.
(3) This reflects two transfers of shares from Mr. Gravengaard not yet
reflected in the list of shareholders in exhibit __ which are subject to a Right of First Refusal by the Company.
(4) Consists of: (i) 8,948,426 shares of common stock held of record by Edward Weinhaus; and (ii)
18,670,385 shares of common stock held of record by Liberty Digital Holdings, LLC, an entity beneficially owned and controlled by
Mr. Weinhaus.
(5) Consists of: (i) 152,199,975 shares of common stock held of record
by Jonathan Mork; and (ii) 25,551,045 shares of common stock held of record by Millennium Group Inc.
(6) Mr. Weinhaus, the Company’s President and director, has a beneficial interest in the return
on the investment in the Company’s 6% Convertible Debentures made by JJE Management LLC, which is a general partner of TOI Fund
L.P. (the “Fund”). Mr. Weinhaus became a minority member of JJE Management LLC in March, 2021 when he provided legal
services to said entity. Mr. Weinhaus is not an officer or managing member of JJE Management LLC and had no decision-making authority
regarding JJE Management LLC’s investment in the Company’s 6% Convertible Debentures. Should the Convertible Debenture
earn only interest, then Mr. Weinhaus will earn 4% of such accrued interest. Should the Convertible Debenture convert to common stock
and earn a higher return, Mr. Weinhaus could earn a maximum of 8% of the profits of the Fund’s investment in the Convertible
Debenture.
(7) Consists of: (i) 1,000,000 shares of common stock held of record by Ryan Myers; (ii) 2,600,000 shares of common stock held of record by RKVP LLC, an entity beneficially owned and controlled by Mr. Myers; and (iii) 500,000 shares of common stock held of record by Ryan Myers and Kelsey Myers.

 

To our knowledge, none of the Selling Shareholders is a registered
broker-dealer or an affiliate of a broker-dealer.

 

 

 

 

 

Plan
of Distribution

 

 

This prospectus relates to the resale of an aggregate
of 459,783,937 shares of our common stock, par value $0.001 per share.

 

The Selling Shareholders may, from time to time,
sell any or all of the shares of our common stock covered by this prospectus from time to time at prevailing market prices at
the time of sale, at varying prices or at negotiated prices. A selling shareholder may use any one or more of the following methods when
selling securities:

 

  · ordinary brokerage transactions on OTC Pink, in the over the counter market, or on any other national
securities exchange on which our shares are listed and traded, and transactions in which the broker-dealer solicits purchasers;
     
  · block trades in which the broker-dealer will attempt to sell the shares as agent but may position
and resell a portion of the block as principal to facilitate the transaction;
     
  · purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
     
  · an exchange distribution in accordance with the rules of the applicable exchange;
     
  · privately negotiated transactions;
     
  · in transactions through broker-dealers that agree with the selling stockholder to sell a specified
number of such securities at a stipulated price per security;
     
  · through the writing or settlement of options or other hedging transactions, whether through an
options exchange or otherwise;
     
  · a combination of any such methods of sale; or
     
  · any other method permitted pursuant to applicable law.

 

The Selling Shareholders may also sell securities
under Rule 144 under the Securities Act of 1933, if available, rather than under this prospectus.

 

Broker-dealers engaged by the Selling Shareholders
may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling Shareholders
(or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts to be negotiated, but, except
as may be set forth in a supplement to this prospectus, in the case of an agency transaction, not in excess of a customary brokerage
commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a mark up or mark down in compliance with
FINRA IM-2440.

 

In connection with the sale of the securities
or interests therein, the Selling Shareholders may enter into hedging transactions with broker-dealers or other financial institutions,
which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling Shareholders
may also sell securities short and deliver these securities to close out such short positions, or loan or pledge the securities to broker-dealers
that in turn may sell these securities. The Selling Shareholders may also enter into option or other transactions with broker-dealers
or other financial institutions or create one or more derivative securities that require the delivery to such broker-dealer or other
financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may
resell pursuant to this prospectus (however, in such case, we must file a prospectus supplement or an amendment to this registration
statement under applicable provisions of the Securities Act amending it to include such successors in interest as Selling Shareholders
under this prospectus).

 

 

 

 

The Selling Shareholders might not sell any,
or all, of the shares of our common stock offered pursuant to this prospectus. In addition, we cannot assure you that the Selling Shareholders
will not transfer the shares of our common stock by other means not described in this prospectus.

 

The Selling Shareholders and any brokers,
dealers, agents or underwriters that participate with the Selling Shareholders in the distribution of our common stock pursuant to this
prospectus may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. In
this case, any commissions received by these broker-dealers, agents or underwriters and any profit on the resale of our common stock
purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. In addition, any profits realized
by the Selling Shareholders may be deemed to be underwriting commissions. If the Selling Shareholders and any brokers, dealers, agents
or underwriters that participate with the Selling Shareholders in the distribution of our common stock pursuant to this prospectus are
deemed to be an underwriter, the Selling Shareholders and such other participants in the distribution may be subject to certain statutory
liabilities and would be subject to the prospectus delivery requirements of the Securities Act in connection with sales of shares of
our common stock.

 

The resale securities will be sold only through
registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale
securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption
from the registration or qualification requirement is available and is complied with.

 

Under applicable rules and regulations under
the Securities Exchange Act of 1934, any person engaged in the distribution of the resale securities may not simultaneously engage in
market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to
the commencement of the distribution. In addition, the selling stockholder will be subject to applicable provisions of the Securities
Exchange Act of 1934 and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales
of securities of the common stock by the Selling Shareholders or any other person. We will make copies of this prospectus available to
the Selling Shareholders and will inform them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time
of the sale (including by compliance with Rule 172 under the Securities Act).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Legal
Matters

 

Unless otherwise indicated, Law Office of
Iwona J. Alami, Newport Beach, California, will pass upon the validity of the shares of our common stock to be sold in this offering.

 

EXPERTS

 

The consolidated financial statements of Athena
Bitcoin Global (issued under its previous name GamePlan, Inc.) and subsidiaries as of December 31, 2021 and for the year ended December
31, 2020, included in this prospectus and elsewhere in the registration statement have been audited by BF Borgers CPA PC, an independent
registered public accounting firm, as stated in their report. Such financial statements have been so included in reliance upon the report
of such firm given upon their authority as experts in accounting and auditing.

 

DISCLOSURE
OF COMMISSION’S POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

 

Our directors and officers are indemnified
as provided by Nevada law, our Amended and Restated Articles of Incorporation, and our bylaws. We have agreed to indemnify each of our
directors and certain officers against certain liabilities, including liabilities under the Securities Act. Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the
provisions described above, or otherwise, we have been advised that in the opinion of the SEC, such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such
liabilities (other than our payment of expenses incurred or paid by our director, officer or controlling person in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being
registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act
and will be governed by the final adjudication of such issue.

 

WHERE YOU CAN FIND MORE
INFORMATION

  

We have filed with the SEC a Registration
Statement on Form S-1 under the Securities Act, and the rules and regulations promulgated thereunder, with respect to the common stock
offered hereby. This Prospectus, which constitutes a part of the Registration Statement, does not contain all of the information set
forth in the Registration Statement and the exhibits thereto. While we have summarized the material terms of all agreements and exhibits
included in the scope of this Registration Statement, for further information regarding the terms and conditions of any exhibit, reference
is made to such exhibits. Upon effectiveness of this Prospectus, we will be subject to the reporting and other requirements of Section
15(d) of the Securities Exchange Act of 1934 and will file periodic reports with the Securities and Exchange Commission, including a
Form 10-K for the year ended December 31, 2021 and periodic reports on Form 10-Q during that period. We will make available to our shareholders
annual reports containing financial statements audited by our independent auditors and our quarterly reports containing unaudited financial
statements for each of the first three quarters of each year; however, we will not send the annual report to our shareholders unless
requested by an individual shareholder.

 

For further information with respect to us
and the common stock, reference is hereby made to the Registration Statement and the exhibits thereto, which may be inspected and copied
at the principal office of the SEC, 100 F Street NE, Washington, D.C. 20549, and copies of all or any part thereof may be obtained at
prescribed rates from the Commission’s Public Reference Section at such addresses. Also, the SEC maintains a website at http://www.sec.gov
that contains reports, proxy and information statements and other information regarding registrants that file electronically with the
SEC. To request such materials, please contact Eric Gravengaard, our Chief Executive Officer.

 

 

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED FINANCIAL STATEMENTS

Athena Bitcoin Global

For the twelve months ended December 31, 2021
and 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Report of Independent Registered Public Accounting
Firm

 

To the shareholders and the board of directors
of Athena Bitcoin Global

 

Opinion on the Financial Statements

 

We have audited the accompanying consolidated
balance sheets of Athena Bitcoin Global (the “Company”) as of December 31, 2021 and 2020, the related statements of operations,
stockholders’ equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the “financial
statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company
as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States.

 

Substantial Doubt about the Company’s
Ability to Continue as a Going Concern

 

The accompanying financial statements have been
prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s
significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding
of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 

/s/ BF Borgers CPA PC

BF Borgers CPA PC

 

We have served as the Company’s auditor since
2020

Lakewood, CO

March 31, 2022

 

 

 

Athena Bitcoin Global

Consolidated Balance Sheets

 

    December 31,     December 31,  
    2021     2020  
    (in thousands)  
Assets            
Current assets:                
Cash and cash equivalents   $ 1,174     $ 2,085  
Restricted cash held for customers     3,671        
Accounts receivable     1,531        
Other advances     845        
Prepaid expenses and other current assets     727       116  
Total current assets     7,948       2,201  
                 
Crypto assets held     842       1,343  
Property and equipment, net     2,903       788  
Leased assets     2,318       2,067  
Other noncurrent assets     990       76  
Total assets   $ 15,001     $ 6,475  
                 
Liabilities and Shareholders’ deficit                
Current liabilities:                
Accounts payable and accrued expenses   $ 1,044     $ 433  
Accounts payable, related party     407       407  
Liability for cash held for customers     3,671        
Advances for revenue contract     3,500        
Leased liabilities     624       487  
Income tax payable     14       324  
Deferred tax liabilities           104  
Related party crypto asset borrowings           881  
Long-term debt, current portion     1,959       1,354