NOTE 6 – LOANS RECEIVABLE

The Company’s loans receivable consist primarily of loans acquired and financed in connection with its RWA platform activities. Loans receivable are carried at amortized cost, net of any allowance for expected credit losses, and are included in “Loans Receivable” on the Company’s Condensed Consolidated Balance Sheets. The Company evaluates expected credit losses on loans receivable in accordance with ASC 326, considering the underlying collateral, contractual recourse provisions, and the creditworthiness of counterparties. Based on this evaluation, management concluded no allowance was recorded as of the reporting date.

Warehouse Facility Loan Receivables

The Company, through its wholly-owned subsidiary ETHZilla Auto Loans, provides a revolving warehouse credit facility to Anchored Finance, LLC. Advances under the Warehouse Facility are secured by eligible auto loan receivables and related collateral and are subject to borrowing base requirements. The Warehouse Facility has a commitment amount of up to $10.0 million and an initial term of 12 months from the closing date, with automatic renewal for successive six-month periods unless either party provides notice of non-renewal. Advances under the Warehouse Facility carry interest at 12.0% per annum on the outstanding advance balance and the Company receives an unused facility fee of 1.0% per annum based on the daily average amount of the unused portion of the Warehouse Facility.

Warehouse Facility loan receivables are accounted for as loans held for investment and are measured at amortized cost, net of any allowance for expected credit losses.

As of June 30, 2026, an aggregate of $2.7 million in advances had been made under the Warehouse Facility, and the outstanding principal balance of warehouse facility loan receivables supported by the borrowing base was $2.5 million. Such amount is included in “Loans Receivable, current portion” on the Company’s Condensed Consolidated Balance Sheets. The Company recognized interest income of $0.1 million during the three and six months ended June 30, 2026, related to the Warehouse Facility, which is included within “Interest income” on the Condensed Consolidated Statements of Operations and Comprehensive Loss.

As of June 30, 2026, the Company evaluated these warehouse facility loan receivables for expected credit losses in accordance with ASC 326, and the related allowance was immaterial.

Zippy Manufactured Home Loan Receivables

The Company owns manufactured and modular home loan receivables secured by first-lien manufactured home collateral. The loans are serviced by Zippy Loans, LLC pursuant to applicable servicing agreements (the “Community Recourse Loans”).

The loan portfolio currently consists of Community Recourse Loans. Community Recourse Loans relate to manufactured homes located in designated manufactured housing communities and benefit from community recourse or repurchase arrangements under defined conditions for a limited period of time. Non-Recourse Loans, which do not include such provisions and rely solely on recovery from the underlying collateral, may be acquired in future periods pursuant to forward-flow arrangements.

The Community Recourse Loans are accounted for as loans held for investment and are measured at amortized cost, including the effect of any unamortized premiums, net of any allowance for expected credit losses. During the three months ended June 30, 2026, the Company acquired additional loans for a total purchase price of $5.0 million (equal to 104% of the outstanding principal balance at the purchase date). During the six months ended June 30, 2026, the Company acquired loans for an aggregate purchase price of $14.8 million (equal to 104% of the outstanding principal balance at the respective purchase dates), on which it recognized an aggregate loan premium of $0.6 million. Loan premiums are amortized over the life of the loans as a reduction of interest income using the effective interest method. During the three and six months ended June 30, 2026, the Company amortized an immaterial amount of the premium to interest income.

As of June 30, 2026, the outstanding principal balance of the manufactured home loan receivables was $14.7 million and is included within “Loans receivable, net of current portion” on the Condensed Consolidated Balance Sheets. As of June 30, 2026, the Community Recourse Loans had a weighted average interest rate of 9.85% per annum and a weighted average remaining term of 20.2 years.

The Company recognized interest income of $0.4 million during each of the three and six months ended June 30, 2026, related to the loan portfolio, which is included within “Interest Income” on the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Management concluded that an allowance for expected credit losses was not required as of June 30, 2026, as the Company’s exposure to credit losses is mitigated by the underlying collateral and contractual community recourse provisions.

As of June 30, 2026, the Company’s loan balance and scheduled principal repayments were as follows: