10-K: Cypherpunk Pivots to Privacy Tech, Reports Q4 ZEC Gain

Cypherpunk Technologies Inc. reports a significant net income for 2025 driven by an unrealized gain on its Zcash holdings, following a strategic pivot to privacy technology while scaling back its biotechnology operations.

Summary

• Cypherpunk Technologies Inc. (formerly Leap Therapeutics, Inc.) completed a strategic pivot in October 2025, shifting its primary focus to privacy technology and a digital asset treasury strategy anchored by Zcash (ZEC), while its biotechnology operations continue under a wholly-owned subsidiary, Leap Therapeutics, Inc.
• The company reported a net income of $4.822 million for the year ended December 31, 2025, a substantial improvement from a net loss of $67.555 million in 2024.
• This positive financial result was primarily driven by a $50.404 million unrealized gain on the change in fair value of its ZEC digital asset holdings.
• As of December 31, 2025, Cypherpunk held $147.404 million in digital assets receivable, representing its ZEC treasury holdings.
• Research and development expenses decreased significantly to $25.670 million in 2025 from $57.211 million in 2024, largely due to the completion of clinical trials and a reduction in force impacting approximately 75% of the company's workforce.
• The company received a Nasdaq notification on March 4, 2026, for failing to maintain a minimum closing bid price of $1.00 per share for 30 consecutive business days, with a deadline of August 31, 2026, to regain compliance.
• A material weakness in internal control over financial reporting was identified related to the accounting for complex and unusual transactions, specifically concerning the new digital asset treasury strategy.
• Cypherpunk invested $5 million in Zcash Open Development Lab (ZODL) on March 9, 2026, as part of a larger $25 million financing round, demonstrating commitment to the Zcash ecosystem.
• As of March 11, 2026, the company held 294,743.10 ZEC tokens at an average purchase price of $335.89, representing approximately 1.76% of the total circulating supply, with an objective to accumulate at least 5% over time.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a highly uncertain situation. While the net income is positive, it's largely due to a volatile, unrealized crypto gain, overshadowing significant operational challenges like a Nasdaq delisting notice, internal control weakness, and a major reduction in its traditional biotech R&D.

Positives

• Reported a net income of $4.822 million for 2025, a significant turnaround from a $67.555 million net loss in 2024.
• Recognized a substantial $50.404 million unrealized gain on its Zcash (ZEC) digital asset holdings in 2025.
• Successfully initiated a digital asset treasury strategy, accumulating 290,062.67 ZEC tokens by December 31, 2025, and an additional 4,680.43 ZEC by March 11, 2026.
• Made a strategic $5 million investment in Zcash Open Development Lab (ZODL) to support the Zcash ecosystem and protocol development.
• Sirexatamab (DKN-01) showed promising results in the DeFianCe Phase 2 study for DKK1-high colorectal cancer patients, with improved ORR (44.0% vs. 15.8%), median PFS (9.36 months vs. 5.88 months), and median OS (NYR vs. 9.49 months) compared to the control arm.
• Sirexatamab has received Orphan Drug Designation and Fast Track designation from the FDA for specific cancer indications.

Negatives

• The company has a history of operating losses since inception in 2011, with an accumulated deficit of $462.549 million as of December 31, 2025.
• Cash and cash equivalents decreased significantly to $14.035 million at year-end 2025 from $47.249 million at year-end 2024, with net cash used in operating activities of $43.902 million.
• Received a Nasdaq deficiency letter on March 4, 2026, for failing to meet the minimum $1.00 bid price requirement, risking delisting.
• Identified a material weakness in internal control over financial reporting related to accounting for complex and unusual transactions, specifically digital assets.
• The digital asset treasury strategy exposes the company to extreme volatility in ZEC prices, with significant declines noted in early 2026 that would result in an unrealized loss.
• The significant reduction in research and development expenses ($31.5 million decrease) was primarily due to the completion and wind-down of clinical trials and a 75% workforce reduction, indicating a scaling back of biotech operations.
• EU regulations effective July 1, 2027, will prohibit transactions involving anonymous wallets and privacy-focused digital assets like ZEC, potentially impacting Zcash adoption and value.

Risks

• ZEC is a highly volatile digital asset, and fluctuations in its price may adversely influence financial results and the market price of listed securities.
• Limited experience in investing in and managing digital assets, relying on a single third-party custodian (Gemini), which concentrates custody risk and exposes the company to potential loss in case of custodian insolvency or security breaches.
• Potential for inadvertent engagement in transactions with prohibited persons under U.S. or foreign sanctions laws due to the pseudonymous nature of blockchain transactions, leading to reputational harm, fines, or penalties.
• The cryptography used on the Zcash network could fail or be used to facilitate illicit activities, increasing the risk of criminal/civil lawsuits and potential delisting from exchanges for privacy-focused digital assets.
• Blockchain networks are susceptible to disruptions, forks, 51% attacks, hacks, and other adverse events, which could materially and adversely impact the company.
• Emerging technologies like artificial intelligence and quantum computing may compromise the Zcash Network's cryptographic security, leading to theft or fraud.
• Significant legal, commercial, tax, technical, and regulatory uncertainty surrounding ZEC and other digital assets, including the possibility of ZEC being classified as a security or the company as a commodity pool, leading to additional regulatory burdens.
• ZEC does not pay interest or dividends, making return on investment solely dependent on price appreciation, which is highly uncertain.
• Digital asset holdings are less liquid than cash and cash equivalents and may not serve as a reliable source of liquidity during market instability.
• The concentration of ZEC holdings enhances risks, as significant declines would have a more pronounced impact on financial condition.
• Inability to raise additional capital on acceptable terms could compromise the digital asset treasury strategy and biotech development.
• The therapeutic safety and efficacy of sirexatamab is unproven, and successful development and commercialization of any product candidates are highly speculative and uncertain.
• Substantial competition from much larger pharmaceutical and biotechnology companies in the oncology space.
• Reliance on third parties (CROs, CMOs) for preclinical studies, clinical trials, and manufacturing introduces risks of delays, non-compliance, and supply chain issues.
• Failure to maintain compliance with Nasdaq's continued listing requirements could result in delisting of common stock, adversely affecting market liquidity and financing ability.
• Material weakness in internal control over financial reporting could adversely affect the ability to produce timely and accurate financial statements.

Future Outlook

The company expects to continue incurring significant expenses and operating losses for the foreseeable future as it expands its privacy technology and digital asset treasury strategy, and continues development of its product candidates (sirexatamab and FL-501). It anticipates needing to raise additional capital through equity offerings, debt financings, or collaborations to fund operations and potential commercialization, as it does not expect to generate revenue from therapeutic drug product sales in the short term. The company aims to accumulate at least 5% of the total circulating Zcash supply over time, subject to market conditions and capital availability. It also plans to implement remediation efforts for the identified material weakness in internal controls and take steps to regain Nasdaq listing compliance, potentially including a reverse stock split.

Management Comments

• We were renamed to Cypherpunk to reflect the strategic focus on acquiring ZEC, participating in the development of Zcash, and the values of privacy and liberty.
• Our mission is to advance technologies that guarantee privacy for all humans on the internet. Our vision is a future where technology defends self-sovereignty and secures human freedom.
• We believe that privacy is a precondition for the meaningful exercise of individual freedoms, including freedom of speech, thought, and association.
• To our knowledge, there is no publicly traded company whose core mission is the advancement of privacy technology. We intend to fill that gap.
• Our strategy is to combine disciplined capital allocation with active investment in privacy infrastructure, positioning the Company to benefit from what we believe is a structural increase in global demand for privacy-preserving technologies.
• Our investment thesis for ZEC rests on two premises: Zcash's sound monetary principles and privacy-preserving capabilities, and the belief that the market has not yet priced in the growing structural demand for financial privacy.
• Our stated objective is to accumulate holdings representing at least 5% of the total circulating supply over time.
• We believe that Zodl represents critical privacy infrastructure and will support the adoption of Zcash and demand for ZEC.
• We believe that our cash and cash equivalents as of December 31, 2025 will be sufficient to fund our operating expenses and capital expenditure requirements for at least 12 months from the filing of this Annual Report on Form 10-K.

Industry Context

StockSavvy.ai notes that Cypherpunk Technologies Inc.'s strategic pivot positions it uniquely as a publicly traded entity primarily focused on privacy-enhancing technologies within the digital asset space, differentiating itself from traditional crypto treasury companies. This move aligns with a growing, albeit nascent, demand for digital privacy infrastructure amidst expanding digital surveillance. In the biotechnology sector, the company's continued, albeit scaled-back, development of DKN-01 and FL-501 places it in the highly competitive oncology and cachexia markets, where numerous large pharmaceutical and biotech firms are actively developing similar therapies. The investment in ZODL reflects a broader industry trend of companies actively participating in the development of the blockchain ecosystems they invest in, rather than merely holding assets. The regulatory challenges highlighted for privacy-focused digital assets, such as ZEC, are a significant industry-wide concern, particularly with impending EU regulations.

Comparison to Industry Standards

• Cypherpunk's focus on Zcash (ZEC) for privacy-preserving transactions distinguishes it from general digital asset treasury companies like Strategy Inc., which primarily focus on Bitcoin.
• The company views Zcash as 'private digital money' compared to Bitcoin as a 'store of value,' highlighting a specific niche within the broader cryptocurrency market.
• The DeFianCe Phase 2 study results for sirexatamab in DKK1-high colorectal cancer patients (ORR 44.0%, median PFS 9.36 months) appear favorable when compared to a historical clinical trial of bevacizumab in combination with chemotherapy, which yielded an ORR of approximately 5% and PFS of 5.7 months in second-line patients.
• The company acknowledges competition in anti-DKK1 monoclonal antibodies from major players such as Novartis, Merck, Amgen, Pfizer, Junshi Biosciences, and Twist Biosciences.
• For FL-501, the company notes competition in GDF-15 targeting antibodies from Pfizer, CatalYm, and NGM Biosciences, stating FL-501 was engineered for higher target affinity and longer plasma half-life.
• The company's digital asset custody with Gemini, an affiliate of its largest stockholder Winklevoss Capital, is a related-party arrangement, which is not uncommon in the crypto space but introduces specific counterparty risks compared to diversified custody solutions.
• The Nasdaq listing deficiency highlights a common challenge for smaller, volatile companies, contrasting with the stability typically seen in larger, established industry players.

Management Changes

Corporate Governance

Legal Proceedings

• Not currently a party to any material legal proceedings as of the date of this report.

Related Party Transactions

• Gemini Space Sciences LLC, the third-party custodian for the company's ZEC digital assets, is an affiliate of Winklevoss Capital, which is a Lead Investor in the company.
• Winklevoss Capital beneficially owns 19.9% of the company's outstanding common stock, excluding certain shares issuable upon exercise of warrants.
• The company invested $5 million in Zcash Open Development Lab (ZODL) on March 9, 2026, as part of a financing round that also included investments from Winklevoss Capital and other notable entities.

Stakeholder Impact

• Shareholders face potential dilution from ongoing and future equity financings (private placements, ATM sales) and the exercise of warrants.
• Shareholders are exposed to significant volatility in the company's stock price, which is expected to be highly correlated with the volatile price of ZEC.
• Shareholders face the risk of delisting from Nasdaq due to the minimum bid price deficiency, which could negatively impact liquidity and investment appeal.
• Employees experienced a significant reduction in force (approximately 75% of the workforce) in 2025 as the company wound down certain R&D activities, impacting job security and morale.
• The company's reliance on a single custodian (Gemini) for its substantial ZEC holdings exposes it to counterparty risk, potentially impacting creditors and the overall financial stability if Gemini faces insolvency or operational issues.
• The strategic shift to privacy technology and digital assets may attract new investors interested in this sector, while potentially alienating traditional biotech investors.

Next Steps

• Continue to acquire additional ZEC with the objective of accumulating at least 5% of the total circulating supply.
• Support the Zcash ecosystem and protocol development through investments like the $5 million in ZODL.
• Pursue the development of sirexatamab and FL-501 through the Leap Therapeutics subsidiary.
• Seek additional funding through equity offerings, debt financings, or collaboration agreements to support ongoing operations and strategic initiatives.
• Implement remediation plans to address the material weakness in internal control over financial reporting, including enhanced oversight and specialized training for finance staff.
• Monitor the common stock's closing bid price and take definitive steps, potentially including a reverse stock split, to regain compliance with Nasdaq's listing requirements by August 31, 2026.
• Apply for patent term extensions for sirexatamab and other products upon FDA approval, where applicable.

Key Dates

Recommendation

The company's strategic pivot to privacy technology and digital assets, while generating a significant unrealized gain in 2025, introduces substantial new risks, particularly given the extreme volatility of ZEC and regulatory uncertainties. The simultaneous scaling back of biotech operations, coupled with a Nasdaq delisting notice and an identified material weakness in internal controls, creates a highly speculative investment profile. While the long-term vision for privacy technology is compelling, the immediate operational and market challenges warrant a cautious 'hold' stance. Investors should monitor the company's ability to regain Nasdaq compliance, remediate internal control issues, and demonstrate sustainable value creation from its digital asset strategy, especially given the noted ZEC price declines post-year-end.

Keywords

Cypherpunk Technologies, Zcash, ZEC, Privacy Technology, Digital Assets, Cryptocurrency, Biotechnology, Oncology, Sirexatamab, DKN-01, Colorectal Cancer, SEC Filing, 10-K, Financial Report, Nasdaq, Corporate Governance, Risk Management, Winklevoss Capital, Gemini, ZODL