ITEM 1A. RISK FACTORS 12
ITEM 1B. UNRESOLVED STAFF COMMENTS 47
ITEM 1C. CYBERSECURITY 48
ITEM 2. PROPERTIES 48
ITEM 3. LEGAL PROCEEDINGS 48
ITEM 4. MINE SAFETY DISCLOSURES. 48
ITEM 6. [RESERVED] 50
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 57
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 57
ITEM 9A. CONTROLS AND PROCEDURES 57
ITEM 9B. OTHER INFORMATION 58
Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 58
PART III 59
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 59
ITEM 11. EXECUTIVE COMPENSATION 64
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES 75
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES 76
SIGNATURES 80
i
CAUTIONARY
NOTE ON Forward-Looking Statements
This
Annual Report on Form 10-K (the “Annual Report”) includes a number of forward-looking statements that reflect management’s
current views with respect to future events and financial performance. Forward-looking statements are projections in respect of future
events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,”
“should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “potential” or “continue” or the negative of these terms or other comparable terminology.
Those statements include statements regarding the intent, belief or current expectations of our Company and members of our management
team as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially
from those contemplated by such forward-looking statements. Those risks and uncertainties include, among others:
● our inability to successfully operate as a combined business from the Merger;
● competition in our markets;
● volatility of our stock price;
● the effect of any cybersecurity incident;
● general economic conditions; and
These
statements are only predictions and involve known and unknown risks, uncertainties and other factors. Readers are urged to carefully
review and consider the various disclosures made by us in this Annual Report and in our other reports filed with the Securities and Exchange
Commission. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence
of unanticipated events or changes in future operating results over time except as required by law. We believe that our assumptions are
based upon reasonable data derived from and known about our business and operations. No assurances are made that actual results of operations
or the results of our future activities will not differ materially from our assumptions.
RISK
FACTOR SUMMARY
Our
business is subject to significant risks and uncertainties that make an investment in us speculative and risky. Below we summarize what
we believe are the principal risk factors, but these risks are not the only ones we face, and you should carefully review and consider
the full discussion of our risk factors in the section titled “Risk Factors,” together with the other information in this
Annual Report on Form 10-K. If any of the following risks actually occurs (or if any of those listed elsewhere in this Annual Report
on Form 10-K occur), our business, reputation, financial condition, results of operations, revenue, and future prospects could be seriously
harmed. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important
factors that adversely affect our business.
Risks
Related to our Business
Risks
Related to Our Growth
● New offerings or lines of business may subject us to additional risks.
Risks
Related to Cryptocurrency Mining
Risks
Related to Digital Assets
Risks
Related to Our Common Stock
● We are an early-stage company with limited operating history.
Part
I
Throughout
this Annual Report, “Datacentrex,” the “Company,” “we,” “us,” and “our” refers
to Datacentrex, Inc., individually, or as the context requires, collectively with its subsidiaries.
Item
1. Business
Company
Overview
Datacentrex,
Inc. (formerly, Thumzup Media Corporation), a Nevada corporation (“Datacentrex,” the “Company,” “we,”
“us,” or “our”) is a digital infrastructure and capital deployment company that owns and operates Scrypt compute
assets and evaluates strategic transactions across asset-backed operating businesses. Our current operating platform is centered on owned
and operated Scrypt-based proof-of-work (“PoW”) compute deployed through third-party colocation facilities. We monetize this
compute primarily through hashrate marketplace mechanisms and manage a treasury of digital assets and cash in a manner intended to preserve
capital and support opportunistic, accretive deployment.
Our
Scrypt compute operations utilize specialized application-specific integrated circuit (“ASIC”) hardware to contribute hashrate
to the Litecoin blockchain. Through merged-mining architecture, that same hashrate can simultaneously secure and validate additional
Scrypt-based networks, including Dogecoin and other auxiliary Scrypt chains, without incremental energy consumption. This merged-mining
attribute allows a single deployment of compute and power to produce economic exposure to multiple networks, subject to protocol rules
and monetization mechanics.
On
August 18, 2025, Datacentrex, entered into an Agreement and Plan of Merger with TZUP Merger Sub, Inc., a wholly-owned subsidiary of the
Company, and Dogehash Technologies, Inc. (“Doge”), a Nevada corporation, pursuant to which the Company agreed to acquire
Doge (the “Merger”). As of the consummation of the Merger between Thumzup Media Corporation (“Thumzup”) and Doge,
the Company operates more than 3,100 Scrypt ASIC miners deployed across multiple geographically diversified colocation facilities.
Our
results are primarily driven by (i) realized revenue rate per unit of hashrate deployed, (ii) power cost and curtailment exposure at
the facility level, (iii) uptime and operational execution, (iv) availability and replacement cycle dynamics for Scrypt ASIC supply,
and (v) treasury and capital allocation decisions, including decisions regarding holding, converting, or deploying digital assets and
cash.
We
are not a protocol developer. We do not control any blockchain network and do not generate revenues from maintaining or updating any
open-source network protocol. Our results depend on our ability to procure and operate compute infrastructure economically and to monetize
that compute in a manner that produces attractive risk-adjusted returns.
The
Company’s operations are principally operated remotely at various data centers throughout the United States. The Company’s
principal address is 470 W 200 N STE 18, Salt Lake City, UT 84103 and its telephone number is (800) 403-6150. The Company’s website
address is www.datacentrex.com. The information provided on the Company’s website or connected thereto does not constitute part
of, and is not incorporated by reference into, this Annual Report on Form 10-K.
Corporate
Information and History
Our
current business was formed through a series of transactions involving an asset acquisition, a public-company business combination, and
a subsequent name change.
Thumzup
Media Corporation (“Thumzup”) was incorporated in the State of Nevada on October 27, 2020. Thumzup was originally organized
as a technology company focused on social media advertising and content monetization.
In
July 2025, Doge acquired certain digital asset mining assets and related business operations from US Data & Energy, LLC (“USDE”)
pursuant to an asset purchase transaction. These assets included ASIC miners and related equipment that were located at colocation facilities,
warehoused, on order, or in transit for digital asset compute activities.
Thereafter,
Doge was acquired by Thumzup in the Merger. Following completion of the Merger, the combined company changed its name to Datacentrex,
Inc.
The
Company’s operations are principally operated remotely at various data centers throughout the United States. The Company’s
principal address is 470 W 200 N STE 18, Salt Lake City, UT 84103 and its telephone number is (800) 403-6150. The Company’s website
address is www.datacentrex.com. The information provided on the Company’s website or connected thereto does not constitute part
of, and is not incorporated by reference into, this Annual Report.
Unless
the context requires otherwise, references in this section to our “operations,” “fleet,” or “compute platform”
refer to the business and assets as operated by Datacentrex following the Merger.
Recent
Developments
Doge
Acquisition
On
August 18, 2025, Datacentrex entered into an Agreement and Plan of Merger (the “Merger Agreement”) with TZUP Merger Sub,
Inc., a wholly-owned subsidiary of Datacentrex (“Merger Sub”), and Dogehash Technologies, Inc. (“Doge”), a Nevada
corporation, pursuant to which the Company agreed to acquire Doge.
On
December 15, 2025, Merger Sub and Doge filed Articles of Merger with the Nevada Secretary of State pursuant to which, effective as of
December 15, 2025, Merger Sub merged with and into Doge with Doge surviving as a wholly-owned subsidiary of the Company. Pursuant to
the terms of the Merger Agreement, the Company issued an aggregate of 13,835,188 shares of the Company’s common stock, and 16,239.812
shares of Series D Convertible Preferred convertible into an aggregate of 16,239,812 shares of common stock to the shareholders of Doge
in exchange for 100% of the outstanding capital stock of Doge.
Name
Change
On
December 15, 2025, the Company filed a Certificate of Amendment to its Amended and Restated Articles of Incorporation with the Secretary
of State of the State of Nevada to change its name to Datacentrex, Inc. from Thumzup Media Corporation.
Public
Offering
On
March 26, 2026, we entered into a placement agency with Dominari Securities LLC, pursuant to which we sold directly to investors, in
a best efforts offering, an aggregate of (i) 4,510,000 shares of common stock at $2.00 per share and (ii) pre-funded warrants to purchase
up to an aggregate of 5,575,000 shares of common stock at $1.99 per pre-funded warrant. The securities were offered and sold by us pursuant
to our effective registration statement on Form S-3 (File No. 333-286951). The closing of the offering occurred on March 31, 2026 and
the gross proceeds from the offering were approximately $20.2 million, before deducting placement agent fees and expenses and estimated
offering expenses payable by us. We intend to use the net proceeds received from the offering for working capital and general corporate
purposes.
Our
Business Model
We
generate revenues by deploying owned Scrypt ASIC hardware to produce PoW hashrate and monetizing that hashrate through market-based channels.
Our model can be summarized as:
● acquiring and operating owned Scrypt ASIC hardware;
● securing competitive power and physical hosting through colocation agreements;
Our
monetization approach is intended to reduce reliance on any single protocol-native payout stream and improve realized economics by seeking
transparent market pricing for compute and minimizing certain fees and conversion costs that can arise under traditional pool-based mining
models.
Scrypt
Proof-of-Work Compute and Merged Mining
Scrypt
is a PoW hashing algorithm used by Litecoin and certain other digital asset networks, including Dogecoin. Scrypt ASIC miners are not
interchangeable with SHA-256 ASIC miners used for Bitcoin. As a result, Scrypt compute is a distinct compute market with different hardware
supply dynamics, competition levels, and revenue drivers.
We
primarily contribute hashrate to the Litecoin blockchain. Litecoin supports merged mining, which allows the same computational work used
to validate Litecoin blocks to simultaneously validate additional Scrypt-based networks. In practical terms, merged mining can allow
a miner to generate rewards attributable to multiple networks from the same energy input, subject to the rules of the applicable protocols
and the payout mechanisms used by the monetization channel.
Merged
mining does not create unlimited or guaranteed incremental economics. Rewards attributable to auxiliary networks may vary based on protocol
parameters, network conditions, and monetization mechanics. The Company remains exposed to market and network dynamics affecting Scrypt
compute generally, including changes in total network hashrate, mining difficulty, protocol reward structures, and transaction fee markets.
Hashrate
Monetization and Marketplace Model
Traditional
PoW miners often monetize compute by connecting directly to a mining pool that aggregates hashrate from many miners and distributes protocol-native
rewards net of pool fees. Under that approach, miners may then convert protocol-native rewards into other assets (including fiat currencies)
to fund operations or pursue a desired treasury exposure, which can introduce conversion costs, liquidity constraints, execution slippage,
and incremental operational complexity.
We
primarily monetize our Scrypt compute through a hashrate marketplace model. In a hashrate marketplace, compute providers offer available
hashrate to third-party buyers seeking computational capacity for PoW validation. Buyers pay a market-determined rate for hashrate, and
the marketplace coordinates matching, settlement, and operational routing. Under this model, we generally receive compensation based
on prevailing market demand for Scrypt hashrate, with settlement typically denominated in Bitcoin.
Management
believes that monetizing hashrate through a marketplace can, depending on market conditions, (i) improve realized pay rates for hashrate
relative to certain pool-based alternatives, (ii) reduce or eliminate certain pool participation fees and payout variance associated
with protocol-native distributions, and (iii) reduce the need for post-mining conversion transactions that may otherwise create incremental
costs. Marketplace monetization also introduces reliance on marketplace operators and exposes the Company to operational and counterparty
risks associated with those platforms.
We
may utilize mining pools opportunistically or for redundancy; however, we view marketplace monetization as a core component of our current
strategy. Our realized revenue under either model remains sensitive to market demand for compute, network-level dynamics, and overall
digital asset market conditions.
Revenue
Recognition and Customers
The
Company generates revenue through the monetization of Scrypt compute via hashrate marketplaces. Under this model, the Company offers
available hashrate to third-party buyers seeking computational capacity for PoW validation. Buyers pay a market-determined rate for hashrate
based on prevailing supply and demand.
Revenue
is recognized when payment for delivered hashrate is received and the corresponding digital assets are transferred to a wallet controlled
by the Company. Amounts earned but not yet settled or received are not recognized as revenue. Settlement under the hashrate marketplace
model is typically denominated in Bitcoin.
The
buyers of the Company’s hashrate are not concentrated and may include a broad range of market participants. Buyers may include
miners, infrastructure operators, trading firms, and arbitrage participants who purchase hashrate and redirect it to alternative pools
or strategies to capture yield, pricing inefficiencies, or other economic opportunities. The Company does not typically enter into long-term
bilateral contracts with hashrate buyers and generally does not have direct visibility into buyers’ downstream use of purchased
hashrate.
Because
hashrate is sold through marketplace mechanisms, the Company does not rely on a limited number of end customers and is not subject to
traditional customer concentration risk; however, the Company remains dependent on the continued operation and liquidity of the marketplaces
through which it monetizes hashrate.
Key
Operating Inputs
Digital
asset market conditions. Our results are influenced by price, volatility, and liquidity in digital asset markets, including the assets
associated with Scrypt networks and the settlement asset we receive through monetization channels. Adverse movements may reduce revenue
and operating margins and impair liquidity.
Network
difficulty and hashrate. PoW networks dynamically adjust mining difficulty based on total network hashrate. Increased network hashrate
typically increases difficulty, which reduces expected rewards per unit of hashrate deployed and can pressure margins if power costs
or monetization rates do not improve. Conversely, declines in network hashrate can reduce difficulty and improve expected economics for
remaining miners.
Power
costs and curtailment. Electricity is a primary input cost. Power rates, capacity charges, curtailment obligations, transmission
constraints, and other ancillary costs can materially affect profitability. We may be required to curtail load or may voluntarily curtail
load when economically advantageous or contractually required.
Uptime
and operational execution. Because revenue depends on continuous operation of compute assets, uptime is a critical driver of realized
results. Equipment failures, facility outages, maintenance, networking issues, and configuration errors can reduce uptime and revenue.
Hardware
supply and replacement cycles. Scrypt ASIC supply is subject to vendor production schedules, logistics, and market availability.
As competition evolves, miners may need to deploy newer hardware, replace components, or optimize existing fleets to remain competitive.
Counterparty
performance. Our business depends on the performance of hosting providers, marketplace operators, custodians, and trading venues.
Counterparty failures, cybersecurity incidents, or operational disruptions could materially affect results.
Cost
Structure and Operating Leverage
The
Company’s cost structure consists primarily of power costs, hosting-related expenses, and depreciation of capitalized mining equipment.
Power
Costs
Electricity
is the primary operating cost of the Company’s compute operations. Power consumption is variable based on the number of machines
operating at any given time. However, under the Company’s existing colocation arrangements, the price of electricity is fixed pursuant
to contractual agreements, and uptime and power delivery obligations are contractually defined.
If
a hosting or colocation provider fails to deliver power in accordance with the terms of the applicable agreement, the Company may be
entitled to monetary penalties or, in certain circumstances, to terminate the agreement without recourse to the host. As a result, while
power usage fluctuates with operational decisions, power pricing and availability are substantially governed by contract.
Hosting
and Operating Costs
Hosting-related
costs include facility services, power delivery infrastructure, networking, and site-level operations provided by colocation partners.
These costs may include both fixed and variable components depending on contractual terms and facility configuration.
Capitalized
Hardware
Mining
equipment is capitalized and depreciated over its estimated useful life. Hardware costs are not expensed as incurred, and operating margins
are therefore sensitive to both depreciation expense and the economic productivity of deployed equipment.
Operating
Leverage and Scale
Operating
scale does not inherently improve margins under a pure hosting model. Meaningful margin expansion is primarily achievable through upstream
integration into power ownership or power-adjacent infrastructure. If the Company were to acquire or control power generation, interconnection,
or other upstream assets, margins could expand significantly due to reduced energy costs and improved control over the cost structure.
There can be no assurance that such opportunities will be pursued or achieved.
Mining
Equipment and Hosting Arrangements
Mining
Equipment
Datacentrex
owns a fleet of specialized Scrypt ASIC miners used to generate PoW hashrate. Since inception of the operating platform, the Company
has invested in excess of $29 million in mining equipment and related infrastructure.
As
of the consummation of the Merger, the Company operated more than 3,100 Scrypt ASIC miners, which are deployed across multiple colocation
facilities. The Company may hold certain equipment in inventory, in transit, or in staging for deployment, and may acquire additional
miners or components depending on expansion plans, equipment availability, and capital allocation priorities.
The
economic performance of the Company’s mining equipment depends on a number of factors, including hardware reliability, uptime,
network difficulty, power costs, and monetization rates. Over time, competitive dynamics may require replacement, refurbishment, or redeployment
of equipment to maintain attractive operating economics.
Equipment
Lifespan and Replacement Cycles
Scrypt
ASIC miners have finite useful lives and are subject to technological obsolescence over time. However, the lifecycle dynamics of Scrypt
mining equipment differ from those of SHA-256 mining equipment used in Bitcoin mining.
The
Scrypt ASIC market is served by a limited number of manufacturers, and innovation cycles have historically occurred at a slower pace
relative to Bitcoin mining hardware. As a result, Scrypt miners may retain economic usefulness for longer periods, and new hardware generations
may not render prior generations obsolete as rapidly as in other PoW markets.
Management
believes these dynamics can support longer economic lifespans and residual value for Scrypt mining equipment relative to certain other
mining categories. Nonetheless, future technological developments, changes in network economics, or shifts in competitive dynamics could
reduce the useful life or value of existing equipment.
Hosting
and Colocation Arrangements
Datacentrex
deploys its mining equipment primarily through third-party colocation and hosting arrangements. Under these arrangements, hosting providers
supply physical space, electrical infrastructure, power delivery, and certain site services necessary to operate energy-intensive compute
workloads. The Company retains ownership of its mining equipment and remains responsible for configuration, monitoring, maintenance coordination,
and operational management, subject to the terms of applicable hosting agreements.
The
Company currently operates under three colocation arrangements that provide access to electric power sourced from the Electric Reliability
Council of Texas (ERCOT) grid, the Midcontinent Independent System Operator (MISO) grid, and the Georgia Power grid, respectively. These
arrangements allow Datacentrex to diversify geographic exposure, grid risk, and operational dependencies while supporting deployment
of its existing fleet. Hosting arrangements expose the Company to counterparty risk, including the risk that a hosting provider fails
to perform its obligations, experiences operational disruptions, or becomes financially distressed. Hosting agreements may also include
provisions related to curtailment, maintenance windows, capacity constraints, or other operational limitations that can affect uptime
and revenue.
Management
believes that deploying equipment across multiple facilities and grid regions reduces reliance on any single site or power market. However,
diversification does not eliminate the risk of correlated events, including regional grid disruptions, extreme weather events, regulatory
actions, or market-wide curtailment programs. The Company’s ability to expand operations depends on the availability of additional
hosting capacity, power, and interconnection on acceptable terms, as well as access to capital and equipment supply.
Treasury,
Liquidity, and Custody
We
manage digital assets and cash as part of a dynamic treasury and capital allocation strategy intended to preserve capital, maintain liquidity,
and enhance long-term value creation.
Under
our hashrate marketplace monetization model, settlement is typically received in Bitcoin. Management has historically evaluated retaining
Bitcoin-denominated proceeds as a treasury asset rather than immediately converting to fiat currency and expects that future treasury
concentration may favor Bitcoin over time. From time to time, we may allocate a portion of Dogecoin exposure to pilot-stage, protocol-native
yield opportunities within the Dogecoin ecosystem, including limited participation in Layer-2 networks. These activities remain exploratory
and are not governed by a formal treasury policy adopted by our board of directors. We may modify, expand, suspend, or discontinue such
pilot activities based on performance and risk assessment.
We
utilize institutional custodians and trading platforms for custody and execution, including Anchorage Digital and Coinbase Prime, and
are subject to risks associated with third-party custodians and trading venues, including cybersecurity risk, operational risk, legal
and regulatory risk, and counterparty risk.
Infrastructure
and Power Strategy
Power
and physical infrastructure are foundational to our operating platform. Our current compute operations are deployed primarily through
third-party colocation sites that provide access to power and the environment required to run energy-intensive compute.
Management
evaluates opportunities to expand and, where attractive, vertically integrate upstream through acquisitions or developments involving
powered land, interconnection capacity, electrical infrastructure, or operating data-center assets. Such opportunities may improve cost
control and strategic flexibility but can require significant capital, permitting and regulatory execution, and operational integration.
We
do not intend to limit our long-term opportunity set to cryptocurrency-related compute. Management believes our experience operating
energy-intensive compute positions the Company to evaluate other compute-enabled or infrastructure-backed opportunities.
Competitive
Strengths and Strategic Position
Management
believes Datacentrex is competitively positioned within the Scrypt compute market and broader digital infrastructure landscape due to
a combination of operational execution, capital availability, and strategic relationships.
Management
believes the Scrypt ASIC hardware market is currently highly concentrated, with a limited number of manufacturers capable of producing
Scrypt mining equipment at scale. As a result, access to next-generation hardware may be constrained and may serve as a significant barrier
to entry for new or under-capitalized participants. Furthermore, Datacentrex has developed long-standing commercial relationships with
leading manufacturers and suppliers of Scrypt ASIC hardware. These relationships have historically enabled the Company to access new
generations of equipment earlier than many market participants, secure meaningful allocation during periods of constrained supply, and
deploy hardware at scale with greater predictability. Management believes this sourcing capability represents a strategic moat, as early
access to next-generation equipment can materially affect operating economics, competitiveness, and capital efficiency in PoW compute
markets.
Notwithstanding
the foregoing, access to hardware alone is insufficient without the capital, infrastructure, and operational readiness to deploy it effectively.
Datacentrex maintains the balance-sheet capacity, hosting relationships, and internal operational systems necessary to deploy new equipment
rapidly once sourced. The Company’s ability to fund equipment purchases, coordinate logistics, and integrate new hardware into
existing operations reduces deployment friction and shortens the time between capital commitment and revenue generation.
In
addition to the foregoing, Datacentrex operates a scaled fleet of Scrypt ASIC miners across multiple geographically diversified facilities.
Management believes that operating at scale improves negotiating leverage with vendors and hosting providers, supports operational learning
curves, and enables the Company to absorb variability in network conditions, power markets, and equipment performance more effectively
than smaller operators.
Datacentrex’s
compute platform, capital structure, and operational expertise provide strategic flexibility. Management believes the Company is positioned
not only to scale Scrypt compute operations but also to evaluate acquisitions, joint ventures, or infrastructure investments that may
further enhance access to power, equipment, or operating capabilities.
Competition
We
compete across multiple markets, including specialized digital compute, digital asset mining, data-center infrastructure, and transaction-driven
capital deployment.
Scrypt
compute operators. The Scrypt compute sector is less institutionally saturated than Bitcoin mining and is characterized by a limited
number of scaled operators. There are few publicly traded companies operating Scrypt compute as a primary line of business. Furthermore,
from time to time, other entities have and may announce strategic transactions intended to establish Scrypt-focused platforms.
Broader
cryptocurrency miners and potential entrants. We compete indirectly with large-scale cryptocurrency miners and infrastructure operators
that could allocate capital, management attention, or facility capacity into Scrypt compute or adjacent digital infrastructure. Even
where their existing hardware is not interchangeable with Scrypt ASICs, larger miners may have advantages in access to capital, power
procurement, facility development, operating scale, and vendor relationships. Examples of companies that may compete with us for capital,
power, hosting capacity, hardware supply, and acquisition opportunities include (among others): Argo Blockchain; Bit Digital; Bitfarms;
CleanSpark; Cipher Mining; Core Scientific; Hive; Hut 8; Iris Energy; Marathon Digital; Northern Data; Riot Platforms; Digi Power X;
and TeraWulf.
Digital
asset treasury and yield-oriented companies. Certain companies focus on digital asset treasury strategies or ecosystem-based yield
generation, including strategies focused on Dogecoin. These companies generally do not operate energy-intensive compute fleets at scale.
While we do not consider these companies direct competitors with respect to our compute operations, they may compete indirectly for investor
capital or thematic exposure.
Data-center
infrastructure owners and operators. As we evaluate opportunities to acquire or develop infrastructure assets upstream, we compete
with traditional data-center developers, owners, and operators. Competition in this segment is driven by access to power and interconnection,
speed of deployment, permitting and regulatory execution, engineering capabilities, and cost of capital.
Capital
markets and acquisition competition. To the extent we pursue mergers, acquisitions, or strategic investments, we compete with private
equity funds, infrastructure funds, energy developers, and strategic acquirers for attractive assets.
Strategy
and Growth
Datacentrex
is not positioned solely as a cryptocurrency mining company. Management views Scrypt compute as an initial operating platform that can
generate cash flow and operational capabilities that may be leveraged across a broader strategic mandate.
We
intend to maintain flexibility to pursue mergers, acquisitions, asset purchases, joint ventures, and strategic investments across digital
infrastructure, compute-enabled services, energy-adjacent infrastructure, and other asset-backed operating businesses. We may evaluate
opportunities both within and outside the digital asset ecosystem. Management may adjust strategic focus over time in response to market
conditions, regulatory developments, capital availability, and risk-adjusted return opportunities.
Strategic
Scope and Capital Allocation Boundaries
The
Company’s strategy is designed to preserve flexibility while maintaining discipline in capital allocation. Although Datacentrex
currently operates a Scrypt-based compute platform, management does not view the Company as permanently constrained to any single protocol,
asset class, or operating model. Strategic decisions, including material expansions, acquisitions, divestitures, or entry into new lines
of business, are subject to oversight by the Company’s board of directors. While management evaluates a broad range of potential
opportunities, the Company does not intend to deploy capital indiscriminately or to pursue speculative investments unrelated to asset-backed
operating businesses. Notwithstanding the foregoing, there can be no assurance that identified opportunities will be consummated or that
any strategic initiative will be successful.
Government
Regulation
Cryptocurrency
Our
business is subject to evolving laws, regulations, and regulatory scrutiny related to digital assets, data-center and energy infrastructure,
environmental and power usage considerations, and public company disclosure and compliance obligations. Regulatory actions, new legislation,
changes in enforcement priorities, and the interpretation of existing laws may impact our ability to operate, custody, trade, hold, or
deploy digital assets and may affect counterparties we rely upon.
Based
on recent guidance from the SEC, we do not believe that our Scrypt-based PoW activities are subject to registration under the Securities
Act or that the primary crypto assets that we earn through our activities or otherwise acquire are “securities” within the
meaning of the Securities Act. The tests for determining whether a particular digital asset is a “security” and whether a
particular transaction involving digital assets requires registration under the Securities Act, however, are fact-intensive, complex,
and may be difficult to apply. If it is determined in the future that one or more digital assets in which we transact or that we hold
in our treasury is a security, or that the types of transactions we conduct or may conduct in the future require registration with the
SEC, it could have a material adverse effect on our business and operations.
Our
operations may also be affected by utility regulation, interconnection and grid constraints, demand response and curtailment programs,
environmental regulation, and permitting requirements applicable to energy-intensive operations.
Intellectual
Property
Datacentrex
does not rely on patents or licensed proprietary protocols to conduct its operations. However, the Company has developed and maintains
proprietary internal software systems that are integral to the operation, monitoring, and management of its compute infrastructure and
related assets.
These
internal systems are designed to support real-time and near-real-time monitoring of site-level and fleet-level operations, including,
among other things:
● monitoring miner status and uptime across facilities;
● identifying non-functioning or underperforming miners;
● managing pool and marketplace connectivity and routing;
● tracking hashrate output and revenue throughput;
● monitoring power usage and site-level electrical performance; and
● maintaining inventory tracking for deployed, staged, and inactive equipment.
Management
believes these internally developed systems improve operational responsiveness, reduce downtime, support efficient troubleshooting, and
enhance visibility into fleet performance and asset utilization. While such software does not eliminate operational risk, it is intended
to support disciplined execution at scale.
In
addition, the Company relies on a combination of internally developed tools and third-party software and services for monitoring, fleet
management, cybersecurity, data aggregation, and operational administration. Datacentrex takes steps intended to protect its internally
developed software and data through access controls and security practices, although it does not hold registered intellectual property
rights in such systems.
Employees
As
of April 13, 2026, we had two full-time employees, as well as nine investor relations, accounting, legal and operations independent
contractors. We are not a party to any collective bargaining agreements. We believe that we maintain good relations with our employees.
Available
Information
Our
website address is www.datacentrex.com. The contents of, or information accessible through, our website are not part of this Annual Report,
and our website address is included in this document as an inactive textual reference only. We make our filings with the U.S. Securities
and Exchange Commission (“SEC” or “Commission”), including our Annual Reports on Form 10-K, Quarterly Reports
on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports, available free of charge on our website as soon as reasonably
practicable after we file such reports with, or furnish such reports to, the SEC. The public may read and copy the materials we file
with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on
the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an Internet site that
contains reports, proxy and information statements and other information. The address of the SEC’s website is www.sec.gov. The
information contained in the SEC’s website is not intended to be a part of this Annual Report.
Item
1a. risk factors
An
investment in our common stock involves a high degree of risk. You should carefully consider the following risk factors and the other
information in this Annual Report before investing in our common stock. Our business and results of operations could be seriously harmed
by any of the following risks. The risks set out below are not the only risks we face. Additional risks and uncertainties not currently
known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or
operating results. If any of the following events occur, our business, financial condition and results of operations could be materially
adversely affected. In such case, the value and trading price of our common stock could decline, and you may lose all or part of your
investment.
Risks
Related to our Business
We
are an early-stage company with limited operating history.
We
are an early-stage company currently and have a limited operating history. We have not maintained consistent profitability from period
to period, and no assurances can be made that we will achieve consistent profitability in the near future, if ever. Accordingly, you
should consider our business prospects in light of the costs, uncertainties, delays, and difficulties frequently encountered by companies
in the early stages of development. Potential investors should carefully consider the risks and uncertainties that a company with a limited
operating history will face. In particular, potential investors should consider that we may be unable to:
● adjust to changing conditions or keep pace with increased demand;
● attract and retain an experienced management team; or
● raise sufficient funds to effectuate our business plan.
We
have a short operating history in the cryptocurrency mining space, and our new business is subject to a number of significant risks and
uncertainties which affect its future viability.
As
of December 31, 2025, Doge had invested approximately $29 million towards the development of its new cryptocurrency mining business.
Doge entered into agreements and arrangements for equipment and services but has only recently commenced cryptocurrency mining operations.
Among the risks and uncertainties applicable to the Company and its operations are:
For
all of these reasons, our cryptocurrency mining business may not be successful and you may lose all of your investment.
Failure
of critical systems related to our offerings and/or infrastructure could have a material adverse effect on our business, financial condition,
and results of operations.
The
critical systems related to our offerings and infrastructure are subject to failure. Failure of any of our or our colocation hosts’
critical systems, including a breakdown in critical plant, equipment or services, routers, switches or other equipment, power supplies,
or network connectivity, whether or not within our control, could result in service interruptions to us and/or damage to equipment, which
could significantly disrupt business operations, harm our reputation, and reduce our revenue. The destruction or severe impairment of
any of the facilities where our equipment is hosted could result in significant downtime.
Our
or our colocation hosts’ infrastructure and offerings are subject to temporary or permanent interruption by factors that include
but are not limited to:
● power loss or plant downtimes;
● equipment failure;
● human error and accidents;
● theft, sabotage, and vandalism, including security breaches of infrastructure;
● network connectivity downtime and fiber cuts;
● service interruptions resulting from server relocation;
● security breaches of infrastructure;
● improper or inadequate building maintenance;
● physical, electronic, and cybersecurity breaches;
● animal incursions;
● extreme temperatures;
● water damage;
● public health crises, such as pandemics and epidemics; and
● military conflict, terrorism or other geopolitical events.
The
occurrence of any of these events may have a material adverse effect on our business, financial condition, and results of operations.
Moreover, service interruptions and equipment failures may expose us to potential legal liability.
Our
operations are concentrated across a limited number of third-party colocation facilities, and an outage, service degradation, or operational
disruption at any one facility could materially reduce our hashrate and revenue. Because our mining equipment is deployed in third-party
environments, our ability to prevent, detect, and remediate certain events may be constrained by the policies, procedures, staffing,
maintenance practices, security posture, and incident-response timelines of our colocation hosts and their upstream providers. In addition,
relocating or redeploying mining equipment at scale can be time-consuming and costly due to logistical constraints, limited near-term
capacity in comparable facilities, permitting or interconnection lead times applicable to hosts, shipping delays, and the need to reconfigure
infrastructure, all of which could extend downtime and increase costs. Any prolonged interruption, reduced availability, or inability
to promptly transition to an alternative hosting solution could have a material adverse effect on our business, financial condition,
and results of operations.
Our
business may be heavily impacted by geopolitical, social, economic, and other events and circumstances in the United States, or elsewhere.
Our
business may be heavily impacted by geopolitical, social, economic, and other events and circumstances in the United States, and elsewhere.
These include natural disasters, health pandemics (like the COVID-19 pandemic), geopolitical tensions sanctions or other restrictive
actions, interest rate fluctuations, inflationary issues and associated changes in monetary policy or potential economic recession, commodity
prices, legislative and regulatory changes, foreign currency fluctuations, international tariffs, fluctuations in capital markets, and
broad trends in industry and finance. For example, equipment necessary for our operations and our offerings is manufactured in large
part outside of the United States. There is currently significant uncertainty about the future relationship between the United States
and other countries, including Canada, Mexico, China, the European Union, and others, with respect to trade policies, treaties, tariffs,
and taxes. These events and circumstances are largely outside of our influence and control and, while the impact of such events or circumstances
is not presently known, any of them could adversely affect our business, financial condition, and results of operations.
We
face significant competition and may not be able to compete effectively against our current and future competitors.
The
industries in which we operate are highly competitive and continuously evolving. We expect competition to further intensify as existing
and new competitors introduce new offerings or enhance existing offerings and as the industries that we operate in continue to grow.
As we continue to expand in our existing markets and enter new markets, we compete against an increasing number of companies operating
both within North America and abroad, that may be more established or have greater financial and other resources and/or expertise.
Driven
by the proliferation of energy-intensive applications such as cryptocurrency mining and high-performance computing (“HPC”),
demand for energy capacity continues to outpace supply. For example, HPC workloads require high-density infrastructure with capacity
demands multiples greater than legacy data centers can provide, while cryptocurrency mining remains a competitive market that requires
operational efficiency and low-cost energy at scale. At the same time, supply chain disruptions and regulatory constraints have extended
lead times for critical infrastructure, including graphics processing units (“GPUs”), application-specific integrated circuits
(“ASICs”), generators, and transformers. Grid interconnection bottlenecks have further constrained access to power and digital
infrastructure development. In this evolving landscape, we compete directly with cloud services providers, digital infrastructure developers,
and large-scale cryptocurrency miners. The nature of competition varies across the layers of our platform:
● Compete: We compete primarily for, specialized hardware, and Scrypt rewards.
We
are subject to risks associated with our need for significant electrical power.
Our
operations require significant amounts of electrical power and our business, financial condition, and results of operations may be impacted
by the unavailability of power and price fluctuations in the power market. Market prices for power, capacity, and other ancillary services
applicable to our colocation hosts are unpredictable and tend to fluctuate substantially. Unlike most other commodities, electric power
can only be stored on a very limited basis and generally must be produced concurrently with its use. As a result, power prices are subject
to significant volatility due to supply and demand imbalances, especially in the day-ahead and spot markets. Power availability and prices