Back presenting today, already here, Patrick Horsman, who is the Chief Investment Officer of BNB Plus, and Joshua Kruger, Chairman of the Board of BNB Plus. We're going to begin with their brief presentation in just a moment, then we're going to open up the event to your questions. Everyone's lines will remain muted throughout this presentation, but to submit a question, and we'd love to hear from you, please click the Q&A button at the bottom of your Zoom window and type in your question. As we always must do before the presentation, let's do the safe harbor statement. This segment may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements pertaining to future financial and/or operating results, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management, constitute forward-looking statements.
Any statements that are not historical facts should also be considered forward-looking statements. Of course, forward-looking statements can involve risks and uncertainties. Gentlemen, please go ahead.
Thanks for having us. We're excited to be here. I'm Patrick Horsman. I'll start with a quick bio on myself. Josh will do the same, and then we'll jump into the strategies. I've been a hedge fund manager for 24 years. Been involved in crypto asset management since 2018. Josh and I had a prior hedge fund business together that we sold the general partnership of at the end of 2024. Started exploring the DAT market, both as direct investors and then as founders, and we started working on this BNB opportunity in June of 2025. We did a PIPE with a company called Applied DNA Sciences in September of 2025, and have been running the public company since then.
Joshua Kruger. I'm the chair of the board. I got a computer science background, early in Ethereum, kind of mining when I was in college. Started a hedge fund that did some delta neutral trading, back when things were a little different in 2016, and then I've kind of been in the industry since. Did firmware development, and distributed compute, and then again, in 2020 did DeFi funds, which I eventually met Patrick and, you know, the seeds of this strategy here were kind of born in 2020 when DeFi came out.
We've since refined them through running subsequent funds and eventually selling them to a larger fund here in 2024 at the end, and now we've started BNBX with kind of those core strategies run on in-kind assets, in this case, BNB, in an institutional public vehicle.
So I'll start with just a quick overview of the DAT space, and there's kind of two type of DATS. They originally started with Bitcoin. Our view is that Bitcoin doesn't make a lot of sense for a digital asset treasury because it's not a productive asset. You can't generate any yield from it. There's better ways to own Bitcoin, either owning it directly through owning tokens or buying a low-cost ETF, which there's many good options. We think there's a contrast in other ecosystems like BNB, Ethereum, and Solana, where these are productive assets, where high-quality teams, like ours, can generate yield from those, and basically, over time, investors will end up with more tokens than if they bought the token directly through the yield and through the compounding. I'll touch briefly on Binance and BNB and why we chose this ecosystem.
For those not familiar, Binance is the largest company in the crypto space. They have over 300 million users. And that's ex-U.S., so they don't currently have any U.S. customers. But the rest of the globe, 300 million active users. $145 trillion has been traded on Binance since inception in 2017. $34 trillion was traded in 2025. They offer 490 coins available to trade on spot and 584 tokens on futures. One of the most important pieces for us on the yield front is something called Binance Launchpool. This is something that U.S. investors can't access directly because they can't get a Binance account, at least without a lot of offshore structuring and an offshore trading team.
The Launchpool basically is Binance's gift back to its BNB holders, where each time Binance lists a new token on the exchange, they take a listing fee, and rather than putting that listing fee in their pocket, they airdrop that to the holders of BNB through the Launchpool. Last year, they airdropped 782 million in free tokens, and BNBX has that as part of its yield strategy to capture those airdrops, sell them, and turn them back into more BNB. We had done, prior to launching the business, a three-year look-back on the Launchpool airdrops, and it was like a 9%-14% annualized return from selling them and turning them back to BNB. They also have 20 million merchants on Binance Pay.
The big difference of what makes us different from other DATS, even some that are active in Ethereum and Solana, is that we are, we are a group of DeFi hedge fund managers. We've been running active liquidity management strategies on liquid tokens, some of us for our entire careers. We've run large hedge funds that have done this successfully, and we've designed four different yield strategies, that are all non-directional in nature, and that's an important component because we're not trying to add risk to the strategy. You're already taking risk by being long BNB. But these yield strategies are non-directional, so they're additive from a yield standpoint, but not additive from a risk standpoint. We think, the four strategies combined can generate between 9% and 12% annualized.
That will be in-kind in BNB, and over time, as I'd mentioned, investors will end up owning more BNB tokens through BNBX than they would if they just held, the tokens directly. I'll turn it over to Josh, to run through these four different yield strategies.
Yeah. So the, you know, BNB Chain is Binance Smart Chain, started as a kind of a fork of Ethereum, and it since evolved. Can you guys hear me all right?
Yep, yep.
Okay, the audio is now flipping. And so the first and kind of underlying base level yield and base layer of yield is staking, native staking of BNB. That's. That hovers around 2%. That's simply staking to secure the network, and, you know, validate the network and make sure security's there. That's not an extremely high yield, but generally can be stacked with other sources of yield, so it's kind of like the base rate of the ecosystem. And the second core strategy, which is the highest yielding, as Patrick mentioned, is the function of Launchpool, which is distributing tokens to BNB holders.
You know, projects and teams around the ecosystem really want access to that because it just gives them access to the BNB user base, which is 300 million users active and, you know, potentially more that are inactive or periodically active, plus the users that are on the decentralized exchange, and the decentralized ecosystem of Binance Smart Chain. So it is kind of like the single largest user base in crypto that's kind of all coagulated around a single thing. And if you were to take a two-year look back, if you were staked BNB and you had received all those Binance Launchpool airdrops, it annualized and sold them, like, almost immediately, we call it the first hour.
That's about a 9%-14% annualized in the last two years have been realized, and we're projecting it to continue forward. So that strategy is, you know, very lucrative and risk-free for LPs and holders because you're not putting anything at risk outside of just the beta of BNB. You're simply airdropped these tokens, and you're given them. So that's the second core strategy. The third is providing liquidity in somewhat of an automated market maker fashion between two like-kind assets. In this case, it'd be BNB and some staked variant of BNB that also received some of the other benefits earlier. So that is about a 7%-9% annualized rate that's been, you know, verified looking back.
You're not taking any additional exposure because you're in just two BNB assets, and you're earning trading fees when the market swaps between them. That'd be on the Binance Smart Chain. Then the last is collateralizing BNB, and we borrow stablecoins against it and run kind of typical delta-neutral yield strategies, à la what we've done kind of in the past with our crypto hedge funds. That, you know, depending on the borrow rates and the yield opportunities, is somewhat opportunistic, and you, you do that only when you really do have an opportunity to make outsized return that way. But it is possible, and it does present itself frequently enough to be, you know, one of the core strategies and something we're highly competent at.
I guess the last one of the other pieces here is, you know, actually, I'll let Patrick run down the Binance and the BNB on earnings.
Sure. So in addition to direct exposure to the BNB token and these attractive yield strategies that we are targeting at 9%-12%, we also believe this is a tracking stock for Binance. Binance is not public. It's very closely held. Changpeng Zhao, the founder, is really the sole owner at this point. He's the 24th richest person in the world. He has no need for liquidity. I believe he'd have a hard time placing the liquidity if he did take Binance public and other good investments. So we think it's very unlikely that Binance gets to the point where public investors have the opportunity to invest.
We believe that through BNB, this is kind of the tokenization of Binance equity and is the best direct exposure that you can get, and BNBX and BNB+ offer the best way to get that exposure in an easy-to-own Nasdaq equity. I'm gonna walk through a couple of the ways that BNB has claims on Binance's actual earnings. The first is through the tokenomics of BNB. Unlike Bitcoin, Ethereum, Solana, most other coins, which are all inflationary, Bitcoin has a set supply, but most other tokens are inflationary. New tokens are created over time, and the number goes up, share count goes up. BNB started with 202 million tokens, and they've steadily decreased that through a burn mechanism, which means they're permanently deleting from the supply tokens. So they do what's called a quarterly burn.
Over the last 12 months, that's been over $1 billion of tokens each quarter, and those are tokens that are essentially being paid for from the earnings of Binance. So by being a BNB holder, over time, you now have a larger claim on the total network and the BNB supply because the supply keeps shrinking. The second claim on Binance's earnings, we went through a little bit with the Launchpool. Those staking fees are significant, $782 million in fees last year. They didn't take any of those fees for the company. They passed all those through to the holders of BNB. So through these two direct claims on Binance's earnings, the burning of the token and decrease in token supply and the listing fees, we think this is the closest exposure you can get to having exposure to Binance's broader business.
We believe that Binance is likely to enter the U.S. market. We can't predict exactly when, but it's the last very large market that they don't have operations in. They historically did, but the Biden administration kind of ran them out. We think that'll be a big boon for the business as well. This is kind of a way to own exposure in Binance and get ahead of that theme, which will likely be very positive for their business overall. Just in comparison, Binance does 40% of global liquid trading every day on centralized exchanges. Coinbase does 6%. So this is a business that's seven times larger than Coinbase. You can do the math on that and what this company should be worth.
We think it's literally the best business in crypto, and it's the best ecosystem to be associated with. BNB is the fourth largest token in the world after Bitcoin, Ethereum, and Tether. So this is a top five token. The best business in the space, market leader, most users, most volume, and this stock that we have, BNB Plus on BNBX on Nasdaq, offers you a way to get that exposure. When we took the company over and implemented this digital asset treasury strategy, they had an existing DNA business. I'd like to touch briefly on that, because for a lot of DATs, their legacy operations are a real hindrance and an issue. Our team and the existing team, Beth and Clay, our CFO and CEO, we've done a fantastic job working together to rightsize that DNA business.
We've made a major headcount reduction, and we've taken it to where it's had its first couple profitable months since October of this year in the company's history. And we've gotten some of the largest orders in the company's history, and we've done that with a massively reduced cost structure, massively reduced headcount. We're exploring some strategic alternatives for that business. We may raise some more capital. We may spin it out. We haven't made any final decisions, but we've rightsized that business. It's no longer a drain on the operations of the broader company, and just wanted to put that message out there so people, shareholders can understand that, the operating business is in a good place now and is actually either break even or slightly profitable, is our projection.
In summary, we think this is a misunderstood, undervalued opportunity with kind of the recent sell-off in crypto. This is a great entry point for investors to come in and get some exposure to Binance and BNB, and we're one of the few DATS offering you direct BNB and Binance exposure, and would love to open it up to questions.
Thank you very much, Patrick and Josh. Yes, we are now opening this webinar up to your questions. Press the Q&A button and type in your question. As we can only take your written-in questions today, we ask that you not use the Raise Hand button, but we certainly do invite your written-in questions. Sure enough, gentlemen, we've already received some. First one here: "You've emphasized non-directional yield strategies rather than simply betting on price appreciation. How should investors think about the balance between yield generation and long-term BNB exposure?
Sure. So just for clarity, we are always 1X long BNB, so you are getting long BNB exposure. But in addition to that, because BNB is a productive ecosystem and there are opportunities to generate yield, in addition to whatever the token performance is, we can generate that 9%-12% target yield on top of whatever the BNB token performance is. So you're getting both the 1X long exposure, plus whatever the yield strategies are. That yield gets recycled into more BNB, and over time, that yield compounds.
That's part of what kind of makes this vehicle asymmetric for investors, is they're getting the underlying beta appreciation, plus the yield into the future as if it were to be kind of managed in a hedge fund manner.
Thank you, gentlemen. What does success look like as the treasury scales? More assets, higher yield or greater efficiency per unit of capital?
We'd like to hit these metrics that we've laid out, the 9%-12% annualized yield. That will ebb and flow a little bit. A big component of the yield, as we mentioned, is the Launch pool. So we're dependent on kind of new listings on Binance. In a kind of market where there's less new listings, the yield will be a little bit lower. When there's more new listings, the yield could be even higher. So we think hitting that yield target is kind of the best way to measure us. And then we would like to grow the balance sheet more significantly into the hundreds of millions over time of BNB holdings, and continue to compound this for investors.
Gentlemen, how do you decide when to accumulate BNB versus when to prioritize liquidity and flexibility?
The nice thing about all of the DATS is, even when they're invested in tokens, they're essentially sitting on a very liquid asset. So BNB itself trades about $2 billion a day, so there's zero issue if we need liquidity or we need to liquidate some BNB to cover an expense. That's always an option. So we try to stay as fully invested in BNB as possible. When we were deploying the treasury, we tried to do that through some creative acquisition strategies. And we generally don't sit in cash. We try to buy BNB and get the exposure, but I guess if we thought there was a moment where things were undervalued or we viewed an event coming that could push the market down, maybe we would wait a little bit to deploy.
But in general, we're trying to be as fully deployed into BNB as possible, which is our mandate.
Talked about integrating Binance Native and DeFi yield opportunities directly into the treasury framework. What types of opportunities are most attractive today, and how do you manage risk around them?
Sure. So it's the four strategies that Josh ran through. I'll run through them, just high level again. The first is native staking. That's where you stake your BNB to a validator and help secure the network. That's about 2% annualized. The second is the launch pool. You need a Binance account to do that. We've set up an offshore structure for the company in British Virgin Islands, because Binance doesn't accept direct U.S. investment. They will allow a public company like us to be the ultimate beneficial owner, but it has to be through an offshore vehicle. And then we've got an offshore asset management team that trades with Binance, because Binance, again, doesn't allow U.S. investment professionals to trade on Binance. They have to be fully offshore. So over the last quarter, we've implemented that entire structure.
We're in a good position now to execute on the strategy. The launch pool is the second leg of that stool, and we're looking at kind of 8%-14% annualized from the launch pool. The third is liquidity providing on decentralized exchanges in the BNB ecosystem, and that's a funny name called PancakeSwap, but it's actually now one of the biggest decentralized exchanges in the world. Does more volume than Uniswap, and there we can provide liquidity through two different tokens that both give you long BNB exposure, and we think that's kinda 8%-9% annualized yield from swap and staking fees.
And then the final one is opportunistically, when the market makes it available, we can collateralize the BNB, borrow stable coins, and do very low risk, DeFi activities with stable coins, which inherently are non-directional 'cause they're always worth a dollar. Josh, anything to add there?
I think that was, that was well said.
When digital asset markets, as you well know, are cyclical, what elements of your strategy are designed to protect shareholder value during periods of volatility or market stress like we're seeing right now?
So the nice thing about having a productive asset like BNB is even in a down market where token prices decrease, we're still generating yield. So where all the Bitcoin guys are just kinda licking their wounds and really don't have any tools in their tool chest to implement, we're still running the yield strategies, we're still compounding your BNB, and we're not selling BNB when it dips. We're not levered, so we're just holding the same amount of tokens, and over a cycle, the token price, we believe, will come back and hopefully will go up. And we're compounding the number of BNB along the way that we're getting and continuing to generate yield and compound the number of tokens per share for investors.
Yeah, in addition to that, with the exception of native staking, which is actually a return in kind, the other three types are actually return in cash and then repurchase of BNB. And so as the BNB price decreases, presumably, you're buying actually more BNB tokens, which adds to the asymmetry on the upside, when the market kind of returns.
Thank you, gentlemen. Next question: DeFi strategies can vary widely in risk. What guardrails do you have in place to ensure yield generation doesn't introduce hidden balance sheet or counterparty risk?
Sure. As I mentioned, these are all non-directional yield strategies, but I'll turn it over to Josh to run through our risk management framework.
Yeah, I mean, I think largely, of the four strategies, you know, they're very... They're quite simple. There's nothing exotic here that could be done in DeFi and that we have done in the previous hedge fund structures. You know, all these have been chosen because of the simplicity, the tier one status of the underlying smart contracts, and just understanding, you know, they've been running for 4+ years, many audits, you know, backed by Binance directly, et cetera. And they don't introduce any kind of, like, odd exogenous proxy contract risks from teams that are unknown, et cetera. So, it's really in the selection of the strategies that most of the risk is managed here, in that there isn't that much risk being taken.
There's a lot more stuff you can do in DeFi, which introduces risk looping, and I'm sure you guys are, you know, aware of a lot of those things. But broadly, we don't wanna introduce that kind of tail risk into this product, as we see. You know, it's really about holding BNB long-term and really accumulating long-term, and it's, it's more worth it to have more BNB over time than it is to potentially ratchet up the returns, take on some tail risk, and, you know, risk losing BNB over time.
Do you internally benchmark your treasury performance against simply holding BNB or against other yield strategies? And how transparent do you plan to be about that comparison over time?
Internally, we're benchmarked against the price of BNB, I suppose. We're fully transparent. I mean, the, on our website, bnbx.io, there's a dashboard that, describes all of our purchases, the prices, the cap table, and, and everything about the company that an investor and a DAP should know. We're, we're trying to be kind of on the front end of being absolutely transparent on there. In the future, there will be more advanced analytics on the yield itself, and what that means directly for token per share, et cetera. Currently, as Patrick mentioned, we're still setting up some of the, the offshore things in order to get that fully working.
Gentlemen, final question: What is the essential value proposition? Tell us, why should anyone be interested in BNB Plus right now?
So we believe it's the exposure to Binance and the Binance ecosystem. This is one of the best companies in the entire space, seven times larger than Coinbase. You have no direct way, either through public or private markets, to access stock in this company. And essentially, we believe that BNB is the tokenized equity of the Binance ecosystem, and as we ran through earlier, there's several claims on Binance earnings from holding BNB tokens. It's a productive asset, where over time, we can compound, we believe, at a target of 9%-12%. And we think it's a very exciting company that's gonna continue to grow, and we think it's likely that they enter the US market, and that's gonna be significant growth for them.
This is a way to get ahead of which is one of the best companies in the world, in the crypto markets and blockchain space, that hasn't even entered the U.S. market yet. You can own it through an easy-to-own Nasdaq equity, BNBX.
Gentlemen, thank you very much for that enlightening presentation. For more information on BNB Plus, reach us at 1-800-RedChip, or email us at bnbx@redchip.com. Thanks again, Josh and Patrick. We'll see you next time.
Thanks for having us. Bye-bye.
Quite welcome. Thank you. Now, our next presenter will be Andrew Cavaghan of Blue Gold. He'll begin speaking in about four minutes at the top of the hour. In the meantime, what we'll do is we'll show you some videos, some informational videos about RedChip products and services.