Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2025

(a) Principles of consolidation

In addition to its wholly-owned subsidiaries, GAAP requires that the assets, liabilities and results of operations of a variable interest entity (“VIE”) be consolidated into the financial statements of the enterprise that has a controlling interest in the VIE. The determination as to whether an entity qualifies as a VIE depends on the facts and circumstances surrounding each entity, and therefore certain investment vehicles managed by the Company may qualify as VIEs under the variable interest model, whereas others may qualify as voting interest entities (“VOEs”) under the voting interest model. The Company first evaluates whether it holds a variable interest in an entity. Fees that are customary and commensurate with the level of services provided, and where the Company does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, would not be considered a variable interest. The Company factors in all economic interests including proportionate interests through related parties, to determine if such interests are considered a variable interest.

The determination of whether to consolidate a VIE under US GAAP requires a significant amount of judgment concerning the degree of control over an entity by its holders of variable interests. To make these judgments, we conduct an analysis, on a case-by-case basis, of whether we are the primary beneficiary and are therefore required to consolidate an entity. We continually reconsider whether we should consolidate a VIE. Upon the occurrence of certain events, such as modifications to organizational documents and investment management agreements of our products, we will reconsider our conclusion regarding the status of an entity as a VIE. Our judgment when analyzing the status of an entity and whether we consolidate an entity could have a material impact on individual line items within our consolidated financial statements, as a change in our conclusion would have the effect of grossing up the assets, liabilities, revenues and expenses of the entity being evaluated. In light of certain direct and indirect investments into our products, the likelihood of a reasonable change in our estimation and judgment could result in a change in our conclusions to consolidate or not consolidate any VIEs to which we have exposure.

Use of Estimates

(b) Use of estimates

The preparation of the consolidated condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. These estimates include the evaluation of the recoverability of the Company’s ownership interests and advances, the recoverability of deferred tax assets, certain fair value estimates and commitments and contingencies. Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances.

Liquidity

The Company believes that its cash and cash equivalents will be sufficient to fund operations past one year from the issuance of these condensed consolidated financial statements.

Digital Assets

(d) Digital assets

The Company measures digital assets at fair value with changes recognized in earnings in each reporting period. The Company tracks its cost basis of digital assets in accordance with first-in-first-out method of accounting.

The Company’s digital assets are all Level 1 within the fair value hierarchy, except for certain other assets with a fair value of $2 that are Level 2.

The following tables present additional information about the Company’s digital assets as of September 30, 2025 and December 31, 2024, respectively:


	September 30, 2025						December 31, 2024
	Units Held		Cost Basis		Fair Value		Units Held		Cost Basis		Fair Value
Bitcoin		132	$	1,735	$	15,008		131	$	1,688	$	12,239
Litecoin		1,256		142		134		1,218		138		126
Ethereum		176		53		729		176		53		585
Bitcoin Cash		239		72		134		234		70		101
All others				38		193				39		189
			$	2,040	$	16,198			$	1,988	$	13,240


	Balance at December 31, 2024		Revenue recognized		Proceeds and in-kind transfers			Unrealized gain (loss)		Balance at September 30, 2025
Bitcoin
Units		131		1		-			-		132
Amount	$	12,239	$	47	$	-		$	2,722	$	15,008
Litecoin
Units		1,218		38		-			-		1,256
Amount	$	126	$	4	$	-		$	4	$	134
Ethereum
Units		176		-		-			-		176
Amount	$	585	$	-	$	-		$	144	$	729
Bitcoin Cash
Units		234		5		-			-		239
Amount	$	101	$	2	$	-		$	31	$	134
All others
Amount	$	189	$	31	$	(31	)	$	4	$	193

The following tables present additional information about digital assets held in CIPs as of September 30, 2025 and December 31, 2024, respectively:


	September 30, 2025						December 31, 2024
	Units Held		Cost Basis		Fair Value		Units Held		Cost Basis		Fair Value
Bitcoin		1,922	$	11,242	$	219,240		1,936	$	11,374	$	180,770
Bitcoin Cash		15,120		6,624		8,480		15,120		6,624		6,552
Ethereum		18,923		403		1,314		18,923		403		1,245
Litecoin		45,196		3,569		4,831		45,196		3,569		4,658
Ripple		516,187		240		1,469		516,187		240		1,073
All others				559		352				560		267
			$	22,637	$	235,686			$	22,770	$	194,565


	Balance at December 31, 2024		Proceeds and in-kind transfers			Unrealized gain (loss)		Balance at September 30, 2025
Bitcoin
Units		1,936		(14	)		-		1,922
Amount	$	180,770	$	(132	)	$	38,602	$	219,240
Bitcoin Cash
Units		15,120		-			-		15,120
Amount	$	6,552	$	-		$	1,928	$	8,480
Ethereum
Units		18,923		-			-		18,923
Amount	$	1,245	$	-		$	69	$	1,314
Litecoin
Units		45,196		-			-		45,196
Amount	$	4,658	$	-		$	173	$	4,831
Ripple
Units		516,187		-			-		516,187
Amount	$	1,073	$	-		$	396	$	1,469
All others
Amount	$	267	$	-		$	85	$	352

Discontinued operations

(e) Discontinued operations

As discussed in Note 3, during 2025 the Company disposed of its consumer products brands, which represented its consumer products segment. Disposal groups that meet the discontinued operations criteria by the Financial Accounting Standards Board Accounting Standards Codification (“ASC”) 205-20-45 are classified as discontinued operations and are excluded from continuing operations and segment results for all periods presented.

Investments, at Fair Value

(f) Investments, at fair value

The Company invests in securities which are valued at fair value with unrealized gains and losses included in the condensed consolidated statement of operations. Realized gains and losses are determined on the basis of specific identification.

Other Investments

(g) Other Investments

For investments in entities over which the Company exercises significant influence, but which do not meet the requirements for consolidation and for which the Company has not elected the fair value option, the Company uses the equity method of accounting, whereby the Company records its share of the underlying income or loss of such entities. The Company’s share of the underlying net income or loss of such entities is recorded in equity in earnings of affiliated investments on the condensed consolidated statement of operations. As the underlying entities that the Company manages and invests in are, for U.S. GAAP purposes, primarily investment companies accounted for under ASC Topic 946, Financial Services - Investment Companies, which reflect their investments at fair value, the carrying value of the Company’s equity method investments in such entities approximates fair value.

We account for other investments that are not accounted for under the equity method that do not have a readily determinable

fair value under the fair value measurement alternative. Under the fair value measurement alternative, these investments are based on our original cost, less impairments, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar interests of the same issuer. Under this method, our share of the income or losses of such companies is not included in our Consolidated Statements of Operations, however, the result of observable price changes, if any, are reflected in Other income (loss), net. We include the carrying value of these investments in Investments in proprietary funds on the Condensed Consolidated Balance sheets.

The Company’s other investments consist of the following as of September 30, 2025 and December 31, 2024, respectively:


	September 30, 2025		December 31, 2024
Horizon Kinetics Hard Asset, LLC	$	17,487	$	11,299
Consensus Mining & Seigniorage Corporation		838		737
Other miscellaneous investments		3,451		1,407
	$	21,776	$	13,443

Fair Value Measurements

(h) Fair value measurements:

The Company values certain of its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Accounting guidance emphasizes that fair value is a market-based measurement that should be determined based on the assumptions market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, accounting guidance establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) the reporting entity's own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). Valuation techniques used to measure fair value shall maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows:

Level 1 Unadjusted quoted prices in active markets for identical instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these investments does not entail a significant degree of judgment.

Level 2 Valuations based on quoted prices for similar or identical instruments in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The fair value hierarchy guidance gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs.

Revenue Recognition

(i) Revenue Recognition

The Company recognizes revenue under Financial Accounting Standards Board's (“FASB”) Accounting Standards Update (“ASU”) 2014-09, Revenue From Contracts With Customers (Topic 606). The Company recognizes revenue when the performance obligation is satisfied, which is the point at which control of the promised goods or services are transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services.

Management fees, which are generally calculated as a percentage of assets under management, are recognized when earned and collection is probable. Certain contracts for management services also provide for performance-based fees (“Incentive Fees”).

Incentive Fee revenue is recorded when earned by the fund managers of those managed funds to the extent that Return Thresholds have been met and it is probable that a significant reversal of revenue will not occur. These customer contracts require the Company to provide investment management services over a period of time, which represents a performance obligation that the Company satisfies over time. Management fees are a form of variable consideration because the fees that the Company is entitled to vary based on fluctuations in the basis for the management fee. The amount recorded as revenue is generally determined at the end of the period because these management fees are payable on a regular basis (typically monthly) and are not subject to claw back once paid. Management and advisory fees, including Incentive Fees, from consolidated proprietary funds are eliminated in consolidation. The Company earned $0.1 million and $0.5 million of Incentive Fees for the three and nine months ended September 30, 2025, respectively, and from proprietary funds that were eliminated as a result of the consolidation of the respective funds.

The following table disaggregates our management services revenue by type:


	Three months ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Mutual fund management fees	$	8,755	$	6,378	$	28,547	$	16,748
ETF management fees		2,925		1,877		8,133		4,817
Separately managed account management fees		5,631		4,739		16,961		14,737
Proprietary fund management fees & other		453		42		1,824		975
Total management and advisory fees	$	17,764	$	13,036	$	55,465	$	37,277

The following table presents balances of management fees receivable by type:


	September 30, 2025		December 31, 2024
Mutual fund management fees	$	2,845	$	3,233
ETF management fees		976		830
Separately managed account management fees		2,357		2,220
Proprietary fund management fees		224		1,866
Other		414		195
	$	6,816	$	8,344

Other Revenue

(j) Other revenue

The Company produces investment research reports for individual and institutional research clients. In addition, the Company retains a third-party marketing firm to market and distribute its research reports. Clients subscribe at a monthly, annual or multi-annual level. Income is accrued monthly based on current subscription base.

Third Party Distribution

(k) Third party distribution

The Company has agreements in place with several third-party distribution firms and individual marketers (“Marketers”). Generally, each party to the agreement may terminate the agreement in a short notice period. Third party distribution expenses are earned by the Marketers based on revenue earned from some of the Company’s investment products generated by the respective Marketers. Accrued third party distribution expenses represent expenses that have been accrued but not paid. In the event that related fees receivable are deemed uncollectible, both related fees receivable and accrued third party distribution expenses will be written off.

Income Taxes

(l) Income taxes

Income taxes reflect the tax effects of transactions reported in the Condensed Consolidated Financial Statements and consist of taxes currently payable plus deferred income taxes related to certain income and expenses recognized in different periods for financial and income tax reporting purposes. Deferred income tax assets and liabilities are recognized for the future income tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases. A valuation allowance is established when it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which related temporary differences become deductible. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Taxes are reported based on tax positions that meet a more-likely-than-not standard and that are measured at the amount that is more-likely-than-not to be realized. Differences between financial and tax reporting which do not meet this threshold are required to be recorded as unrecognized tax benefits or expense. We classify penalty and interest expense related to income tax liabilities as an income tax expense. There are no significant interest and penalties recognized in the Consolidated Statements of Operations or accrued on the Consolidated Balance Sheets.

Recently Issued Accounting Pronouncements

(m) Recently issued accounting pronouncements

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU No. 2023-09 establishes incremental disaggregation of income tax disclosures pertaining to the effective tax rate reconciliation and income taxes paid. This standard is effective for fiscal years beginning after December 15, 2024, and requires

prospective application with the option to apply it retrospectively. We intend to adopt this standard in our Annual Report on Form 10-K for the year ending December 31, 2025. We are currently evaluating the potential impact of adopting this standard on our disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses: Clarifying the Effective Date. ASU 2024-03 requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory; employee compensation; and depreciation, amortization and depletion expenses for each caption on the income statement where such expenses are included. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. We are currently evaluating the potential impact of adopting this standard on our disclosures.